0000860546false00008605462024-10-282024-10-28

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549
____________________________________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): October 28, 2024
____________________________________________

COPT DEFENSE PROPERTIES
(Exact name of registrant as specified in its charter)
Maryland 1-1402323-2947217
(State or other jurisdiction (Commission File(IRS Employer
of incorporation) Number)Identification No.)

6711 Columbia Gateway Drive, Suite 300, Columbia, MD
21046
(Address of principal executive offices)(Zip Code)
        
Registrant’s telephone number, including area code:  (443) 285-5400

____________________________________________

Not applicable
(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
 Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Shares of beneficial interest, $0.01 par valueCDPNew York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging Growth Company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐




Item 2.02.             Results of Operations and Financial Condition
 
On October 28, 2024, COPT Defense Properties (the “Company”) issued a press release relating to its financial results for the period ended September 30, 2024 and, in connection with this release, is making available certain supplemental information pertaining to its properties and operations.  The earnings release and supplemental information are included as Exhibit 99.1 to this report and are incorporated herein by reference.
 
The information included herein, including the exhibits, shall not be deemed “filed” for any purpose, including the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or subject to liabilities of that Section.  The information included herein, including the exhibits, shall also not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act regardless of any general incorporation language in such filing.

Item 9.01.             Financial Statements and Exhibits

(d)     Exhibits.

Exhibit Number Exhibit Title
 
104Cover Page Interactive Data File (embedded within the Inline XBRL document).



SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 COPT DEFENSE PROPERTIES
/s/ Anthony Mifsud
 Anthony Mifsud
 Executive Vice President and Chief Financial Officer
Date:October 28, 2024



Exhibit 99.1

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COPT Defense Properties
Supplemental Information + Earnings Release - Unaudited
For the Period Ended 9/30/24
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Please refer to the section entitled “Definitions” for definitions of non-GAAP measures
and other terms we use herein that may not be customary or commonly known.

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COPT Defense Properties
Summary Description
THE COMPANY
COPT Defense Properties (the “Company” or “COPT Defense”), an S&P MidCap 400 Company, is a self-managed real estate investment trust (“REIT”) focused on owning, operating and developing properties in locations proximate to, or sometimes containing, key U.S. Government (“USG”) defense installations and missions (which we refer to herein as our Defense/IT Portfolio). Our tenants include the USG and their defense contractors, who are primarily engaged in priority national security activities, and who generally require mission-critical and high security property enhancements. The ticker symbol under which our common shares are publicly traded on the New York Stock Exchange is “CDP”. As of September 30, 2024, our Defense/IT Portfolio of 194 properties, including 24 owned through unconsolidated joint ventures, encompassed 22.2 million square feet and was 96.5% leased.


MANAGEMENTStephen E. Budorick, President + CEOINVESTOR RELATIONSVenkat Kommineni, VP
Britt A. Snider, EVP + COO
443.285.5587 | venkat.kommineni@copt.com
Anthony Mifsud, EVP + CFO
Michelle Layne, Manager
443.285.5452 | michelle.layne@copt.com


CORPORATE CREDIT RATING
Fitch: BBB- Stable | Moody’s: Baa3 Stable | S&P: BBB- Stable


DISCLOSURE STATEMENT
This supplemental package contains forward-looking statements within the meaning of the Federal securities laws. Forward-looking statements can be identified by the use of words such as “may,” “will,” “should,” “could,” “believe,” “anticipate,” “expect,” “estimate,” “plan” or other comparable terminology.  Forward-looking statements are inherently subject to risks and uncertainties, many of which we cannot predict with accuracy and some of which we might not even anticipate.  Although we believe that the expectations, estimates and projections reflected in such forward-looking statements are based on reasonable assumptions at the time made, we can give no assurance that these expectations, estimates and projections will be achieved.  Future events and actual results may differ materially from those discussed in the forward-looking statements and we undertake no obligation to update or supplement any forward-looking statements.  The areas of risk that may affect these expectations, estimates and projections include, but are not limited to, those risks described in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2023.
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3Q 2024 Supplemental Information Package
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COPT Defense Properties
Equity Research Coverage
Firm Senior AnalystPhone Email
BTIGTom Catherwood212.738.6410tcatherwood@btig.com
Citigroup Global Markets Michael Griffin 212.816.5871 michael.a.griffin@citi.com
Evercore ISISteve Sakwa212.446.9462steve.sakwa@evercoreisi.com
Green Street  Dylan Burzinski 949.640.8780 dburzinski@greenstreet.com
Jefferies & Co. Peter Abramowitz 212.336.7241  pabramowitz@jefferies.com
JP Morgan Tony Paolone 212.622.6682 anthony.paolone@jpmorgan.com
Truist Securities Michael Lewis 212.319.5659 michael.r.lewis@truist.com
Wedbush SecuritiesRichard Anderson212.938.9949richard.anderson@wedbush.com
Wells Fargo SecuritiesBlaine Heck410.662.2556blaine.heck@wellsfargo.com
 
With the exception of Green Street, the above-listed firms are those whose analysts publish research material on the Company and whose estimates of our FFO per share can be tracked through FactSet. Any opinions, estimates or forecasts the above analysts make regarding COPT Defense’s future performance are their own and do not represent the views, estimates or forecasts of COPT Defense’s management.
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3Q 2024 Supplemental Information Package
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COPT Defense Properties
Selected Financial Summary Data
(in thousands, except per share data)
 PageThree Months EndedNine Months Ended
SUMMARY OF RESULTS Refer.9/30/246/30/243/31/2412/31/239/30/239/30/249/30/23
Net income (loss)7$37,397 $36,407 $33,671 $34,820 $(221,207)$107,475 $(109,167)
NOI from real estate operations13$105,526 $105,410 $101,657 $98,656 $96,494 $312,593 $285,421 
Same Property NOI17$98,651 $98,672 $95,403 $94,854 $95,039 $292,726 $281,985 
Same Property cash NOI18$97,104 $97,614 $91,619 $89,493 $88,793 $286,337 $263,173 
Adjusted EBITDA11$99,236 $98,592 $95,841 $93,934 $90,260 $293,669 $266,747 
FFO per NAREIT8$76,460 $75,346 $72,799 $72,360 $70,016 $224,605 $208,865 
Diluted AFFO avail. to common share and unit holders10$52,592 $61,435 $59,269 $54,280 $64,122 $173,803 $148,741 
Dividend per common shareN/A$0.295 $0.295 $0.295 $0.285 $0.285 $0.885 $0.855 
Per share - diluted:      
EPS9$0.32 $0.31 $0.29 $0.30 $(1.94)$0.92 $(0.96)
FFO - Nareit9$0.65 $0.64 $0.62 $0.62 $0.60 $1.92 $1.79 
FFO - as adjusted for comparability9$0.65 $0.64 $0.62 $0.62 $0.60 $1.92 $1.79 
Numerators for diluted per share amounts:
Diluted EPS7$35,981 $35,022 $32,480 $33,552 $(217,179)$103,489 $(108,214)
Diluted FFO available to common share and unit holders8$74,905 $74,280 $71,892 $70,913 $68,512 $221,584 $204,486 
Diluted FFO available to common share and unit holders, as adjusted for comparability8$74,974 $74,360 $71,969 $71,100 $68,593 $221,810 $204,813 

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3Q 2024 Supplemental Information Package
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COPT Defense Properties
Selected Financial Summary Data (continued)
(in thousands, except ratios)
 PageAs of or for Three Months Ended
As of and for Nine Months Ended
PAYOUT RATIOS AND CAPITALIZATIONRefer.9/30/246/30/243/31/2412/31/239/30/239/30/249/30/23
GAAP
Payout ratio:
Net incomeN/A90.7%93.1%100.7%93.7%N/A94.6%N/A
Capitalization and debt ratios:
Total assets6$4,234,302 $4,219,338 $4,232,895 $4,246,966 $4,239,257 
Total equity6$1,532,595 $1,530,506 $1,526,046 $1,523,755 $1,525,873 
Debt per balance sheet6$2,390,839 $2,389,925 $2,416,873 $2,416,287 $2,415,783 
Debt to assets3256.5%56.6%57.1%56.9%57.0%N/AN/A
Net income to interest expense ratio321.8x1.8x1.6x1.7xN/A1.7xN/A
Debt to net income ratio3216.0x16.4x17.9x17.3xN/AN/AN/A
Non-GAAP
Payout ratios:      
Diluted FFON/A44.9%45.3%46.8%45.7%47.3%45.6%47.6%
Diluted FFO - as adjusted for comparabilityN/A44.9%45.3%46.7%45.6%47.3%45.5%47.5%
Diluted AFFON/A64.0%54.8%56.8%59.7%50.6%58.1%65.4%
Capitalization and debt ratios:     
Total Market Capitalization29$5,897,659 $5,289,664 $5,218,681 $5,377,815 $5,172,058 
Total Equity Market Capitalization29$3,482,187 $2,873,744 $2,774,450 $2,932,815 $2,726,295 
Net debt37$2,432,567 $2,367,180 $2,372,747 $2,328,941 $2,293,005 
Net debt to adjusted book3240.8%40.5%40.9%40.6%40.5%N/AN/A
Adjusted EBITDA fixed charge coverage ratio324.8x4.7x4.5x4.4x4.6x4.7x4.9x
Net debt to in-place adj. EBITDA ratio326.1x6.0x6.1x6.1x6.2xN/AN/A
Net debt adjusted for fully-leased investment properties to in-place adj. EBITDA ratio325.9x5.9x6.0x6.0x5.9xN/AN/A

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3Q 2024 Supplemental Information Package
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COPT Defense Properties
Selected Portfolio Data (1)
 9/30/246/30/243/31/2412/31/239/30/23
# of Properties
Total Portfolio202201201198196
Consolidated Portfolio178177177174172
Defense/IT Portfolio194193193190188
Same Property189189189189189
% Occupied
Total Portfolio93.1 %93.6 %93.6 %94.2 %94.1 %
Consolidated Portfolio91.6 %92.2 %92.2 %92.9 %92.7 %
Defense/IT Portfolio95.0 %95.5 %95.6 %96.2 %95.9 %
Same Property93.6 %93.5 %93.5 %93.8 %93.8 %
% Leased
Total Portfolio94.8 %94.9 %94.9 %95.3 %95.1 %
Consolidated Portfolio93.6 %93.8 %93.8 %94.3 %94.0 %
Defense/IT Portfolio96.5 %96.7 %96.8 %97.2 %97.0 %
Same Property95.1 %95.0 %95.0 %95.1 %94.9 %
Square Feet (in thousands)
Total Portfolio24,31624,13524,13723,85923,479
Consolidated Portfolio20,02119,83919,84119,56319,184
Defense/IT Portfolio22,17421,99321,99321,71921,339
Same Property22,22422,22422,22422,22422,224
(1)Except for the Consolidated Portfolio, includes properties owned through unconsolidated real estate joint ventures (see page 34).

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3Q 2024 Supplemental Information Package
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COPT Defense Properties
Consolidated Balance Sheets
(in thousands)
 9/30/246/30/243/31/2412/31/239/30/23
Assets     
Properties, net:     
Operating properties, net$3,289,959 $3,257,822 $3,272,452 $3,246,806 $3,148,434 
Development and redevelopment in progress, including land (1)108,077 106,709 76,931 82,972 141,854 
Land held (1)206,652 171,062 168,495 173,900 177,909 
Total properties, net3,604,688 3,535,593 3,517,878 3,503,678 3,468,197 
Property - operating right-of-use assets 40,523 40,899 40,368 41,296 40,487 
Cash and cash equivalents34,478 100,443 123,144 167,820 204,238 
Investment in unconsolidated real estate joint ventures39,720 40,148 40,597 41,052 41,495 
Accounts receivable, net42,240 46,963 50,088 48,946 40,211 
Deferred rent receivable 159,182 156,123 153,788 149,237 142,041 
Lease incentives, net63,034 63,744 61,150 61,331 60,506 
Deferred leasing costs, net 71,815 72,156 70,902 70,057 68,033 
Investing receivables, net83,536 84,087 82,523 81,512 87,535 
Prepaid expenses and other assets, net95,086 79,182 92,457 82,037 86,514 
Total assets$4,234,302 $4,219,338 $4,232,895 $4,246,966 $4,239,257 
Liabilities and equity     
Liabilities:     
Debt $2,390,839 $2,389,925 $2,416,873 $2,416,287 $2,415,783 
Accounts payable and accrued expenses134,112 122,202 111,981 133,315 135,605 
Rents received in advance and security deposits33,213 33,485 37,557 35,409 32,063 
Dividends and distributions payable33,915 33,908 33,906 32,644 32,645 
Deferred revenue associated with operating leases37,660 37,199 34,019 29,049 24,590 
Property - operating lease liabilities33,615 33,818 33,141 33,931 32,940 
Other liabilities15,917 15,530 16,406 18,996 17,936 
Total liabilities2,679,271 2,666,067 2,683,883 2,699,631 2,691,562 
Redeemable noncontrolling interests22,436 22,765 22,966 23,580 21,822 
Equity:   
COPT Defense’s shareholders’ equity:   
Common shares1,127 1,127 1,126 1,126 1,125 
Additional paid-in capital2,493,340 2,489,931 2,487,468 2,489,989 2,489,717 
Cumulative distributions in excess of net income(1,005,260)(1,008,087)(1,009,964)(1,009,318)(1,010,885)
Accumulated other comprehensive income 58 3,614 3,849 2,115 6,094 
Total COPT Defense’s shareholders’ equity1,489,265 1,486,585 1,482,479 1,483,912 1,486,051 
Noncontrolling interests in subsidiaries:     
Common units in the Operating Partnership28,918 29,470 29,214 25,502 25,337 
Other consolidated entities14,412 14,451 14,353 14,341 14,485 
Total noncontrolling interests in subsidiaries43,330 43,921 43,567 39,843 39,822 
Total equity1,532,595 1,530,506 1,526,046 1,523,755 1,525,873 
Total liabilities, redeemable noncontrolling interests and equity$4,234,302 $4,219,338 $4,232,895 $4,246,966 $4,239,257 
(1)Refer to pages 26 and 28 for detail.


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3Q 2024 Supplemental Information Package
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COPT Defense Properties
Consolidated Statements of Operations
(in thousands)
 Three Months EndedNine Months Ended
 9/30/246/30/243/31/2412/31/239/30/239/30/249/30/23
Revenues     
Lease revenue$170,549 $165,619 $165,433 $160,337 $155,268 $501,601 $459,510 
Other property revenue2,014 1,466 1,230 1,225 1,339 4,710 3,731 
Construction contract and other service revenues16,662 20,258 26,603 18,167 11,949 63,523 42,012 
Total revenues189,225 187,343 193,266 179,729 168,556 569,834 505,253 
Operating expenses     
Property operating expenses68,881 63,410 66,746 64,577 61,788 199,037 182,808 
Depreciation and amortization associated with real estate operations38,307 38,161 38,351 36,735 37,620 114,819 112,215 
Construction contract and other service expenses16,127 19,612 26,007 17,167 11,493 61,746 40,249 
Impairment losses— — — — 252,797 — 252,797 
General and administrative expenses8,157 8,591 8,378 8,240 7,582 25,126 22,865 
Leasing expenses2,341 2,462 2,187 2,308 2,280 6,990 6,624 
Business development expenses and land carry costs918 979 1,182 797 714 3,079 1,935 
Total operating expenses134,731 133,215 142,851 129,824 374,274 410,797 619,493 
Interest expense(20,376)(20,617)(20,767)(20,383)(17,798)(61,760)(50,759)
Interest and other income, net3,324 2,884 4,122 5,659 2,529 10,330 6,928 
Gain on sales of real estate— — — — — — 49,392 
Income (loss) before equity in income (loss) of unconsolidated entities and income taxes37,442 36,395 33,770 35,181 (220,987)107,607 (108,679)
Equity in income (loss) of unconsolidated entities85 26 69 (240)(68)180 (21)
Income tax expense(130)(14)(168)(121)(152)(312)(467)
Net income (loss)37,397 36,407 33,671 34,820 (221,207)107,475 (109,167)
Net (income) loss attributable to noncontrolling interests:     
Common units in the Operating Partnership(711)(694)(608)(576)3,691 (2,013)1,882 
Other consolidated entities(601)(599)(454)(592)1,329 (1,654)164 
Net income (loss) attributable to common shareholders$36,085 $35,114 $32,609 $33,652 $(216,187)$103,808 $(107,121)
Amount allocable to share-based compensation awards(104)(92)(129)(100)(992)(319)(1,093)
Numerator for diluted EPS$35,981 $35,022 $32,480 $33,552 $(217,179)$103,489 $(108,214)
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3Q 2024 Supplemental Information Package
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COPT Defense Properties
Funds from Operations
(in thousands)
 Three Months EndedNine Months Ended
 9/30/246/30/243/31/2412/31/239/30/239/30/249/30/23
Net income (loss)$37,397 $36,407 $33,671 $34,820 $(221,207)$107,475 $(109,167)
Real estate-related depreciation and amortization38,307 38,161 38,351 36,735 37,620 114,819 112,215 
Impairment losses on real estate— — — — 252,797 — 252,797 
Gain on sales of real estate— — — — — — (49,392)
Depreciation and amortization on unconsolidated real estate JVs (1)756 778 777 805 806 2,311 2,412 
FFO - per Nareit (2)76,460 75,346 72,799 72,360 70,016 224,605 208,865 
FFO allocable to other noncontrolling interests (3)(985)(984)(836)(972)(1,059)(2,805)(3,006)
Basic FFO allocable to share-based compensation awards(617)(599)(587)(513)(481)(1,803)(1,427)
Basic FFO available to common share and common unit holders (2)74,858 73,763 71,376 70,875 68,476 219,997 204,432 
Redeemable noncontrolling interests— 471 469 — — 1,446 (58)
Diluted FFO adjustments allocable to share-based compensation awards47 46 47 38 36 141 112 
Diluted FFO available to common share and common unit holders - per Nareit (2)74,905 74,280 71,892 70,913 68,512 221,584 204,486 
Executive transition costs69 81 77 188 82 227 330 
Diluted FFO comparability adjustments allocable to share-based compensation awards— (1)— (1)(1)(1)(3)
Diluted FFO available to common share and common unit holders, as adjusted for comparability (2)$74,974 $74,360 $71,969 $71,100 $68,593 $221,810 $204,813 

(1)See page 34 for additional disclosure regarding our unconsolidated real estate JVs.
(2)Refer to the section entitled “Definitions” for a definition of this measure.
(3)Pertains to noncontrolling interests in consolidated real estate JVs reported on page 33.

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3Q 2024 Supplemental Information Package
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COPT Defense Properties
Diluted Share + Unit Computations
(in thousands, except per share data)

 Three Months EndedNine Months Ended
 9/30/246/30/243/31/2412/31/239/30/239/30/249/30/23
EPS Denominator:     
Weighted average common shares - basic112,314 112,293 112,231 112,199 112,196 112,279 112,170 
Dilutive effect of share-based compensation awards696 492 509 432 — 566 — 
Weighted average common shares - diluted113,010 112,785 112,740 112,631 112,196 112,845 112,170 
Diluted EPS$0.32 $0.31 $0.29 $0.30 $(1.94)$0.92 $(0.96)
Weighted Average Shares for period ended:       
Common shares112,314 112,293 112,231 112,199 112,196 112,279 112,170 
Dilutive effect of share-based compensation awards696 492 509 432 429 566 422 
Common units1,696 1,703 1,625 1,514 1,520 1,675 1,508 
Redeemable noncontrolling interests— 926 947 — — 873 51 
Denominator for diluted FFO per share and as adjusted for comparability114,706 115,414 115,312 114,145 114,145 115,393 114,151 
Weighted average common units(1,696)(1,703)(1,625)(1,514)(1,520)(1,675)(1,508)
Redeemable noncontrolling interests— (926)(947)— — (873)(51)
Dilutive effect of additional share-based compensation awards— — — — (429)— (422)
Denominator for diluted EPS113,010 112,785 112,740 112,631 112,196 112,845 112,170 
Diluted FFO per share - Nareit (1)$0.65 $0.64 $0.62 $0.62 $0.60 $1.92 $1.79 
Diluted FFO per share - as adjusted for comparability (1)$0.65 $0.64 $0.62 $0.62 $0.60 $1.92 $1.79 
(1)Refer to the section entitled “Definitions” for a definition of this measure.
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3Q 2024 Supplemental Information Package
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COPT Defense Properties
Adjusted Funds from Operations
(in thousands)
 Three Months EndedNine Months Ended
 9/30/246/30/243/31/2412/31/239/30/239/30/249/30/23
Diluted FFO available to common share and common unit holders, as adjusted for comparability (1)$74,974 $74,360 $71,969 $71,100 $68,593 $221,810 $204,813 
Straight line rent adjustments and lease incentive amortization613 3,788 3,473 313 12,882 7,874 6,205 
Amortization of intangibles and other assets included in NOI211 211 122 26 26 544 24 
Share-based compensation, net of amounts capitalized2,617 2,564 2,645 2,318 2,280 7,826 6,226 
Amortization of deferred financing costs671 681 685 681 639 2,037 1,899 
Amortization of net debt discounts, net of amounts capitalized1,032 1,023 1,014 1,004 750 3,069 1,990 
Replacement capital expenditures (1)(27,824)(21,250)(20,776)(21,498)(21,122)(69,850)(71,996)
Other298 58 137 336 74 493 (420)
Diluted AFFO available to common share and common unit holders (“diluted AFFO”) (1)$52,592 $61,435 $59,269 $54,280 $64,122 $173,803 $148,741 
Replacement capital expenditures (1)     
Tenant improvements and incentives$18,772 $15,045 $12,776 $7,850 $14,457 $46,593 $67,062 
Building improvements6,694 5,705 4,953 14,762 6,307 17,352 11,214 
Leasing costs3,013 3,110 3,590 2,440 1,902 9,713 7,194 
Net additions to (exclusions from) tenant improvements and incentives728 (1,040)316 (189)(813)(11,981)
Excluded building improvements and leasing costs(1,383)(1,570)(859)(3,365)(731)(3,812)(1,493)
Replacement capital expenditures$27,824 $21,250 $20,776 $21,498 $21,122 $69,850 $71,996 
(1)Refer to the section entitled “Definitions” for a definition of this measure.
10
3Q 2024 Supplemental Information Package
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COPT Defense Properties
EBITDAre + Adjusted EBITDA
(in thousands)
 Three Months EndedNine Months Ended
 9/30/246/30/243/31/2412/31/239/30/239/30/249/30/23
Net income (loss)$37,397 $36,407 $33,671 $34,820 $(221,207)$107,475 $(109,167)
Interest expense20,376 20,617 20,767 20,383 17,798 61,760 50,759 
Income tax expense130 14 168 121 152 312 467 
Real estate-related depreciation and amortization38,307 38,161 38,351 36,735 37,620 114,819 112,215 
Other depreciation and amortization614 564 608 619 615 1,786 1,826 
Impairment losses on real estate— — — — 252,797 — 252,797 
Gain on sales of real estate — — — — — — (49,392)
Adjustments from unconsolidated real estate JVs1,759 1,709 1,671 1,911 1,743 5,139 5,006 
EBITDAre (1)98,583 97,472 95,236 94,589 89,518 291,291 264,511 
Credit loss expense (recoveries)38 436 22 (1,288)372 496 677 
Business development expenses557 603 630 445 313 1,790 948 
Executive transition costs69 81 430 188 82 580 636 
Net gain on other investments(11)— (477)— (25)(488)(25)
Adjusted EBITDA (1)99,236 98,592 95,841 93,934 90,260 $293,669 $266,747 
Pro forma NOI adjustment for property changes within period— — 813 1,341 1,647 
Change in collectability of deferred rental revenue— 27 — (198)— 
In-place adjusted EBITDA (1)$99,236 $98,619 $96,654 $95,077 $91,907 
(1)Refer to the section entitled “Definitions” for a definition of this measure.

11
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Properties by Segment - 9/30/24
(square feet in thousands)
# of
Properties
Operational
Square Feet
% Occupied% Leased
Defense/IT Portfolio:
Fort Meade/Baltimore Washington (“BW”) Corridor:    
National Business Park34 4,292 98.9%99.4%
Howard County36 3,063 91.0%92.3%
Other23 1,725 92.0%95.4%
Total Fort Meade/BW Corridor93 9,080 94.9%96.2%
Northern Virginia (“NoVA”) Defense/IT 16 2,500 90.5%92.9%
Lackland AFB (San Antonio, Texas)1,143 93.0%100.0%
Navy Support22 1,273 83.3%89.3%
Redstone Arsenal (Huntsville, Alabama)24 2,475 94.7%95.6%
Data Center Shells:
Consolidated Properties1,408 100.0%100.0%
Unconsolidated JV Properties (1)24 4,295 100.0%100.0%
Total Defense/IT Portfolio194 22,174 95.0%96.5%
Other 2,142 73.4%76.2%
Total Portfolio202 24,316 93.1%94.8%
Consolidated Portfolio178 20,021 91.6%93.6%
(1)See page 34 for additional disclosure regarding our unconsolidated real estate JVs.

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(2)Refer to the section entitled “Definitions” for a definition of this measure.
12
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Consolidated Real Estate Revenues + NOI by Segment
(in thousands)
 Three Months EndedNine Months Ended
 9/30/246/30/243/31/2412/31/239/30/239/30/249/30/23
Consolidated real estate revenues     
Defense/IT Portfolio:
Fort Meade/BW Corridor$80,056 $77,715 $78,068 $74,758 $73,350 $235,839 $215,303 
NoVA Defense/IT 22,083 20,601 21,426 20,410 20,333 64,110 60,003 
Lackland Air Force Base16,879 16,447 16,411 17,861 16,193 49,737 49,393 
Navy Support8,068 8,240 8,226 8,405 8,190 24,534 24,233 
Redstone Arsenal18,332 17,017 16,808 14,971 13,768 52,157 40,160 
Data Center Shells-Consolidated9,029 9,600 8,457 7,654 6,811 27,086 19,790 
Total Defense/IT Portfolio154,447 149,620 149,396 144,059 138,645 453,463 408,882 
Other 18,116 17,465 17,267 17,503 17,962 52,848 54,359 
Consolidated real estate revenues (1)$172,563 $167,085 $166,663 $161,562 $156,607 $506,311 $463,241 
NOI from real estate operations (2)     
Defense/IT Portfolio:
Fort Meade/BW Corridor$52,127 $53,078 $50,178 $48,894 $48,134 $155,383 $141,379 
NoVA Defense/IT 12,831 11,671 12,164 11,972 12,433 36,666 36,848 
Lackland Air Force Base7,719 7,650 7,723 7,708 7,626 23,092 22,930 
Navy Support3,984 4,607 4,600 4,783 4,257 13,191 13,241 
Redstone Arsenal11,869 11,296 11,016 10,157 8,820 34,181 25,826 
Data Center Shells:
Consolidated properties7,475 7,509 7,514 6,966 6,133 22,498 17,775 
COPT Defense’s share of unconsolidated real estate JVs1,844 1,735 1,740 1,671 1,675 5,319 4,988 
Total Defense/IT Portfolio97,849 97,546 94,935 92,151 89,078 290,330 262,987 
Other 7,677 7,864 6,722 6,505 7,416 22,263 22,434 
NOI from real estate operations (1)$105,526 $105,410 $101,657 $98,656 $96,494 $312,593 $285,421 
(1)Refer to the section entitled “Supplementary Reconciliations of Non-GAAP Measures” for reconciliation.
(2)Refer to the section entitled “Definitions” for a definition of this measure.
13
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Cash NOI by Segment
(in thousands)
 Three Months EndedNine Months Ended
 9/30/246/30/243/31/2412/31/239/30/239/30/249/30/23
Cash NOI from real estate operations (1)     
Defense/IT Portfolio:
Fort Meade/BW Corridor$49,998 $51,017 $47,117 $46,173 $45,513 $148,132 $134,902 
NoVA Defense/IT13,223 12,452 12,933 12,881 12,765 38,608 36,830 
Lackland Air Force Base8,218 8,124 8,186 8,114 7,913 24,528 23,747 
Navy Support4,000 4,656 4,503 5,008 4,621 13,159 14,555 
Redstone Arsenal9,730 9,034 6,308 4,869 4,861 25,072 13,556 
Data Center Shells:
Consolidated properties6,739 6,748 6,688 5,868 4,904 20,175 15,201 
COPT Defense’s share of unconsolidated real estate JVs1,565 1,481 1,477 1,400 1,396 4,523 4,132 
Total Defense/IT Portfolio93,473 93,512 87,212 84,313 81,973 274,197 242,923 
Other 7,656 7,869 6,723 6,536 7,400 22,248 22,333 
Cash NOI from real estate operations (2)$101,129 $101,381 $93,935 $90,849 $89,373 $296,445 $265,256 
(1)Refer to the section entitled “Definitions” for a definition of this measure.
(2)Refer to the section entitled “Supplementary Reconciliations of Non-GAAP Measures” for reconciliation.
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14
3Q 2024 Supplemental Information Package
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COPT Defense Properties
NOI from Real Estate Operations + Occupancy by Property Grouping - 9/30/24
(dollars and square feet in thousands)
 As of Period EndNOI from Real Estate Operations (3)
# of
Properties
Operational Square Feet% Occupied (1)% Leased (1)Annualized
Rental Revenue (2)
% of Total
Annualized
Rental Revenue (2)
Property GroupingThree Months EndedNine Months Ended
Defense/IT Portfolio:
Same Property: (2)
Consolidated properties160 16,535 94.8%96.5%$569,703 84.4 %$89,733 $266,937 
Unconsolidated real estate JV 21 3,547 100.0%100.0%6,414 0.9 %1,405 4,001 
Total Same Property in Defense/IT Portfolio181 20,082 95.8%97.1%576,117 85.3 %91,138 270,938 
Properties Placed in Service (4)1,062 90.9%91.3%26,979 4.0 %5,860 17,216 
Other unconsolidated JV properties (5)748 100.0%100.0%1,414 0.2 %399 1,283 
Acquired properties (6)282 39.8%68.3%4,074 0.6 %452 893 
Total Defense/IT Portfolio194 22,174 95.0%96.5%608,584 90.1 %97,849 290,330 
Other2,142 73.4%76.2%66,816 9.9 %7,677 22,263 
Total Portfolio 202 24,316 93.1%94.8%$675,400 100.0 %$105,526 $312,593 
Consolidated Portfolio178 20,021 91.6%93.6%$667,572 98.8 %$103,682 $307,274 
(1)Percentages calculated based on operational square feet.
(2)Refer to the section entitled “Definitions” for a definition of this measure.
(3)Refer to the section entitled “Supplementary Reconciliations of Non-GAAP Measures” for reconciliation.
(4)Newly developed or redeveloped properties placed in service that were not fully operational by 1/1/23.
(5)Includes three data center shell properties in which we sold ownership interests and retained 10% interests through unconsolidated real estate JVs in 2023.
(6)Includes office properties acquired in 2024 (see page 25).

15
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Same Property (1) Average Occupancy Rates by Segment 
(square feet in thousands)
 # of PropertiesOperational Square FeetThree Months EndedNine Months Ended
 9/30/246/30/243/31/2412/31/239/30/239/30/249/30/23
Defense/IT Portfolio:
Fort Meade/BW Corridor91 8,692 96.0 %96.1 %96.2 %96.2 %95.8 %96.1 %94.5 %
NoVA Defense/IT16 2,500 90.7 %88.5 %87.9 %88.5 %89.8 %89.0 %90.1 %
Lackland Air Force Base1,062 100.0 %100.0 %100.0 %100.0 %100.0 %100.0 %100.0 %
Navy Support21 1,244 83.7 %85.6 %85.6 %87.8 %87.2 %85.0 %87.9 %
Redstone Arsenal20 2,049 97.6 %96.8 %97.7 %97.4 %93.5 %97.4 %91.3 %
Data Center Shells:
Consolidated properties988 100.0 %100.0 %100.0 %100.0 %100.0 %100.0 %100.0 %
Unconsolidated JV properties21 3,547 100.0 %100.0 %100.0 %100.0 %100.0 %100.0 %100.0 %
Total Defense/IT Portfolio181 20,082 95.8 %95.6 %95.7 %95.9 %95.5 %95.7 %94.8 %
Other 2,142 73.1 %72.9 %72.0 %73.9 %75.2 %72.7 %76.3 %
Total Same Property189 22,224 93.6 %93.4 %93.4 %93.8 %93.5 %93.5 %93.0 %

Same Property (1) Period End Occupancy Rates by Segment 
(square feet in thousands)
# of PropertiesOperational Square Feet
 9/30/246/30/243/31/2412/31/239/30/23
Defense/IT Portfolio:
Fort Meade/BW Corridor91 8,692 95.7 %96.0 %96.1 %96.3 %96.1 %
NoVA Defense/IT16 2,500 90.5 %89.2 %88.2 %88.9 %89.5 %
Lackland Air Force Base1,062 100.0 %100.0 %100.0 %100.0 %100.0 %
Navy Support21 1,244 83.9 %85.2 %86.4 %88.0 %87.4 %
Redstone Arsenal20 2,049 97.8 %96.8 %97.5 %97.7 %95.7 %
Data Center Shells:
Consolidated properties988 100.0 %100.0 %100.0 %100.0 %100.0 %
Unconsolidated JV properties21 3,547 100.0 %100.0 %100.0 %100.0 %100.0 %
Total Defense/IT Portfolio181 20,082 95.8 %95.7 %95.8 %96.0 %95.8 %
Other 2,142 73.4 %73.4 %72.5 %73.2 %75.4 %
Total Same Property189 22,224 93.6 %93.5 %93.5 %93.8 %93.8 %
(1)Includes properties stably owned and 100% operational since at least 1/1/23.

16
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Same Property Real Estate Revenues + NOI by Segment
(in thousands)
 Three Months EndedNine Months Ended
 9/30/246/30/243/31/2412/31/239/30/239/30/249/30/23
Same Property real estate revenues     
Defense/IT Portfolio:
Fort Meade/BW Corridor$77,279 $74,921 $76,082 $74,008 $73,350 $228,282 $215,296 
NoVA Defense/IT22,084 20,600 21,426 20,411 20,333 64,110 60,002 
Lackland Air Force Base16,879 16,447 16,411 17,860 16,193 49,737 49,394 
Navy Support7,913 8,085 8,073 8,251 8,035 24,071 23,770 
Redstone Arsenal15,214 14,317 14,311 13,861 13,520 43,842 39,632 
Data Center Shells-Consolidated6,543 6,658 6,427 6,186 6,205 19,628 18,783 
Total Defense/IT Portfolio145,912 141,028 142,730 140,577 137,636 429,670 406,877 
Other 16,069 15,446 15,262 15,500 15,953 46,777 48,707 
Same Property real estate revenues$161,981 $156,474 $157,992 $156,077 $153,589 $476,447 $455,584 
Same Property NOI from real estate operations (“NOI”)     
Defense/IT Portfolio:
Fort Meade/BW Corridor$50,090 $50,953 $48,330 $48,239 $48,134 $149,373 $141,379 
NoVA Defense/IT12,832 11,670 12,164 11,972 12,433 36,666 36,848 
Lackland Air Force Base7,724 7,650 7,723 7,708 7,625 23,097 22,930 
Navy Support3,903 4,536 4,522 4,702 4,177 12,961 12,980 
Redstone Arsenal9,661 9,281 9,321 9,148 8,665 28,263 25,481 
Data Center Shells:
Consolidated properties5,523 5,527 5,527 5,538 5,539 16,577 16,836 
COPT Defense’s share of unconsolidated real estate JVs1,405 1,295 1,301 1,233 1,236 4,001 3,713 
Total Defense/IT Portfolio91,138 90,912 88,888 88,540 87,809 270,938 260,167 
Other 7,513 7,760 6,515 6,314 7,230 21,788 21,818 
Same Property NOI (1)$98,651 $98,672 $95,403 $94,854 $95,039 $292,726 $281,985 
(1)Refer to the section entitled “Supplementary Reconciliations of Non-GAAP Measures” for reconciliation.



17
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Same Property Cash NOI by Segment
(dollars in thousands)
 Three Months EndedNine Months Ended
 9/30/246/30/243/31/2412/31/239/30/239/30/249/30/23
Same Property cash NOI from real estate operations (“cash NOI”)     
Defense/IT Portfolio:
Fort Meade/BW Corridor$49,676 $50,605 $47,052 $46,267 $45,513 $147,333 $134,902 
NoVA Defense/IT13,223 12,452 12,933 12,882 12,764 38,608 36,829 
Lackland Air Force Base8,223 8,124 8,186 8,114 7,913 24,533 23,747 
Navy Support3,922 4,589 4,429 4,932 4,545 12,940 14,310 
Redstone Arsenal8,353 7,962 6,412 4,966 4,953 22,727 13,739 
Data Center Shells:
Consolidated properties5,029 5,013 4,984 4,960 4,865 15,026 14,884 
COPT Defense’s share of unconsolidated real estate JVs1,268 1,185 1,183 1,108 1,106 3,636 3,293 
Total Defense/IT Portfolio89,694 89,930 85,179 83,229 81,659 264,803 241,704 
Other 7,410 7,684 6,440 6,264 7,134 21,534 21,469 
Same Property cash NOI (1)$97,104 $97,614 $91,619 $89,493 $88,793 $286,337 $263,173 
Percentage change in total Same Property cash NOI (1)(2)9.4%8.8%
Percentage change in Defense/IT Portfolio Same Property cash NOI (2)9.8%9.6%

(1)Refer to the section entitled “Supplementary Reconciliations of Non-GAAP Measures” for reconciliation.
(2)Represents the change between the current period and the same period in the prior year.

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18
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Leasing (1)(2)
Three Months Ended 9/30/24
(square feet in thousands)
Defense/IT Portfolio
 Ft Meade/BW CorridorNoVA Defense/ITLackland Air Force BaseNavy SupportRedstone ArsenalData Center ShellsTotal Defense/IT PortfolioOther Total
Renewed Space     
Leased Square Feet435 16 — 84 40 43 618 626 
Expiring Square Feet449 34 — 116 48 43 690 25 715 
Vacating Square Feet15 17 — 32 — 72 16 88 
Retention Rate (% based upon square feet)96.7 %47.9 %— %72.3 %83.8 %100.0 %89.6 %33.7 %87.6 %
Statistics for Completed Leasing:
Per Annum Average Committed Cost per Square Foot $1.70 $2.78 $— $2.80 $8.45 $0.56 $2.24 $2.96 $2.25 
Weighted Average Lease Term in Years4.1 4.7 — 3.4 4.1 5.0 4.1 6.1 4.1 
Straight-line Rent Per Square Foot
Renewal Straight-line Rent$37.03 $34.06 $— $24.47 $27.57 $34.64 $34.46 $45.47 $34.61 
Expiring Straight-line Rent$32.78 $32.68 $— $21.57 $24.94 $13.15 $29.37 $41.12 $29.53 
Change in Straight-line Rent13.0 %4.2 %— %13.5 %10.5 %163.4 %17.3 %10.6 %17.2 %
Cash Rent Per Square Foot
Renewal Cash Rent$36.12 $36.42 $— $24.37 $26.83 $33.01 $33.70 $45.85 $33.87 
Expiring Cash Rent$36.05 $37.90 $— $24.00 $26.63 $14.36 $32.34 $47.76 $32.54 
Change in Cash Rent0.2 %(3.9 %)— %1.5 %0.8 %129.9 %4.2 %(4.0 %)4.1 %
Compound Annual Growth Rate2.2 %2.4 %— %3.8 %1.0 %11.7 %3.0 %2.2 %3.0 %
Average Escalations Per Year2.6 %2.5 %— %2.5 %2.4 %3.0 %2.6 %2.8 %2.6 %
New Leases
Investment Space (3)
Leased Square Feet— — 80 — — — 80 — 80 
Statistics for Completed Leasing:
Per Annum Average Committed Cost per Square Foot$— $— $4.21 $— $— $— $4.21 $— $4.21 
Weighted Average Lease Term in Years— — 9.5 — — — 9.5 — 9.5 
Straight-line Rent Per Square Foot$— $— $47.80 $— $— $— $47.80 $— $47.80 
Cash Rent Per Square Foot$— $— $44.32 $— $— $— $44.32 $— $44.32 
Vacant Space
Leased Square Feet23 16 — 59 20 — 119 123 
Statistics for Completed Leasing:
Per Annum Average Committed Cost per Square Foot $6.18 $12.42 $— $36.29 $6.47 $— $22.14 $12.34 $21.83 
Weighted Average Lease Term in Years12.1 9.2 — 5.2 4.9 — 7.0 8.7 7.1 
Straight-line Rent Per Square Foot$32.71 $33.16 $— $60.29 $28.08 $— $45.79 $44.27 $45.74 
Cash Rent Per Square Foot$31.93 $32.85 $— $59.79 $26.96 $— $45.16 $42.75 $45.08 
Total Square Feet Leased458 32 80 143 60 43 817 12 829 
Average Escalations Per Year2.4 %2.6 %3.0 %2.0 %2.5 %3.0 %2.5 %2.8 %2.5 %
Average Escalations Excl. Data Center Shells2.3 %
(1)Activity excludes owner occupied space, leases with less than a one-year term and expirations associated with space removed from service. Weighted average lease term is based on the term defined in the lease assuming no exercise of early termination rights. Committed costs for leasing are reported above in the period of lease execution. Actual capital expenditures for leasing are reported on page 10 in the period such costs are incurred.
(2)Refer to the section entitled “Definitions” for definitions of certain terms on this schedule.
(3)Includes leasing associated with development properties and operating property acquisitions (see definition on page 42).
19
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Leasing (1)(2)
Nine Months Ended 9/30/24
(square feet in thousands)
Defense/IT Portfolio
 Ft Meade/BW CorridorNoVA Defense/ITLackland Air Force BaseNavy SupportRedstone ArsenalData Center ShellsTotal Defense/IT PortfolioOtherTotal
Renewed Space     
Leased Square Feet1,141 404 — 260 132 43 1,981 78 2,058 
Expiring Square Feet1,280 434 — 366 158 43 2,281 161 2,442 
Vacating Square Feet139 30 — 105 25 — 300 84 383 
Retention Rate (% based upon square feet)89.1 %93.0 %— %71.2 %83.9 %100.0 %86.9 %48.1 %84.3 %
Statistics for Completed Leasing:
Per Annum Average Committed Cost per Square Foot$2.61 $3.52 $— $1.86 $3.45 $0.56 $2.71 $4.04 $2.76 
Weighted Average Lease Term in Years4.0 4.1 — 3.1 2.7 5.0 3.9 7.7 4.0 
Straight-line Rent Per Square Foot
Renewal Straight-line Rent$39.36 $40.29 $— $25.92 $26.54 $34.64 $36.82 $34.32 $36.73 
Expiring Straight-line Rent$35.37 $40.22 $— $23.49 $24.83 $13.15 $33.61 $33.50 $33.61 
Change in Straight-line Rent11.3 %0.2 %— %10.3 %6.9 %163.4 %9.6 %2.5 %9.3 %
Cash Rent Per Square Foot
Renewal Cash Rent$38.50 $41.06 $— $26.07 $26.11 $33.01 $36.44 $34.34 $36.36 
Expiring Cash Rent$38.16 $41.93 $— $26.00 $25.85 $14.36 $35.99 $38.16 $36.07 
Change in Cash Rent0.9 %(2.1 %)— %0.3 %1.0 %129.9 %1.3 %(10.0 %)0.8 %
Compound Annual Growth Rate2.6 %2.3 %— %0.6 %1.5 %11.7 %2.4 %2.0 %2.4 %
Average Escalations Per Year2.6 %1.8 %— %2.5 %2.5 %3.0 %2.4 %1.8 %2.4 %
New Leases
Investment Space (3)
Leased Square Feet— — 80 — 10 — 90 — 90 
Statistics for Completed Leasing:
Per Annum Average Committed Cost per Square Foot$— $— $4.21 $— $3.14 $— $4.09 $— $4.09 
Weighted Average Lease Term in Years— — 9.5 — 5.3 — 9.0 — 9.0 
Straight-line Rent Per Square Foot$— $— $47.80 $— $23.81 $— $45.13 $— $45.13 
Cash Rent Per Square Foot$— $— $44.32 $— $23.50 $— $42.00 $— $42.00 
Vacant Space
Leased Square Feet148 62 — 86 22 — 319 68 387 
Statistics for Completed Leasing:
Per Annum Average Committed Cost per Square Foot$7.39 $11.31 $— $27.62 $7.61 $— $13.66 $7.94 $12.66 
Weighted Average Lease Term in Years8.6 7.5 — 5.2 5.1 — 7.2 10.5 7.8 
Straight-line Rent Per Square Foot$32.65 $33.24 $— $50.11 $28.76 $— $37.24 $42.98 $38.25 
Cash Rent Per Square Foot$31.37 $33.43 $— $49.76 $27.63 $— $36.51 $40.34 $37.18 
Total Square Feet Leased1,289 466 80 346 164 43 2,390 146 2,535 
Average Escalations Per Year2.5 %2.0 %3.0 %2.3 %2.6 %3.0 %2.4 %2.2 %2.4 %
Average Escalations Excl. Data Center Shells2.4 %
(1)Activity excludes owner occupied space, leases with less than a one-year term and expirations associated with space removed from service. Weighted average lease term is based on the term defined in the lease assuming no exercise of early termination rights. Committed costs for leasing are reported above in the period of lease execution. Actual capital expenditures for leasing are reported on page 10 in the period such costs are incurred.
(2)Refer to the section entitled “Definitions” for definitions of certain terms on this schedule.
(3)Includes leasing associated with development properties and operating property acquisitions (see definition on page 42).
20
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Lease Expiration Analysis as of 9/30/24 (1)
(dollars and square feet in thousands, except per square foot amounts)
Segment of Lease and Year of Expiration (2)Square Footage of Leases ExpiringAnnualized Rental
Revenue of Expiring Leases (3)
% of Defense/IT
Annualized 
Rental
Revenue
Expiring (3)
Annualized Rental
Revenue of
Expiring Leases per Occupied Sq. Foot (3)
Defense/IT Portfolio
Ft Meade/BW Corridor (a)441 $19,575 3.2 %$44.39 
NoVA Defense/IT10 351 0.1 %33.78 
Navy Support58 1,052 0.2 %18.02 
Redstone Arsenal10 259 — %26.46 
2024519 21,238 3.5 %40.87 
Ft Meade/BW Corridor1,609 62,406 10.3 %38.73 
NoVA Defense/IT88 3,072 0.5 %35.05 
Lackland Air Force Base703 45,916 7.5 %65.34 
Navy Support199 4,980 0.8 %25.05 
Redstone Arsenal265 6,371 1.0 %24.07 
20252,864 122,745 20.2 %42.84 
Ft Meade/BW Corridor974 39,187 6.4 %40.20 
NoVA Defense/IT68 2,321 0.4 %34.28 
Lackland Air Force Base250 12,793 2.1 %51.17 
Navy Support199 6,946 1.1 %34.99 
Redstone Arsenal105 3,067 0.5 %29.14 
Data Center Shells-Unconsolidated JV Properties446 850 0.1 %19.07 
20262,042 65,164 10.7 %39.72 
Ft Meade/BW Corridor935 36,008 5.9 %38.52 
NoVA Defense/IT190 6,487 1.1 %34.09 
Navy Support258 9,298 1.5 %35.97 
Redstone Arsenal171 4,681 0.8 %27.33 
Data Center Shells-Unconsolidated JV Properties364 523 0.1 %14.37 
20271,918 56,997 9.4 %35.82 
Ft Meade/BW Corridor1,672 60,320 9.9 %36.03 
NoVA Defense/IT383 15,832 2.6 %41.36 
Navy Support113 2,674 0.4 %23.60 
Data Center Shells-Unconsolidated JV Properties515 889 0.1 %17.25 
20282,683 79,715 13.1 %35.87 
Thereafter
Consolidated Properties8,059 257,159 42.3 %31.23 
Unconsolidated JV Properties2,970 5,566 0.9 %18.74 
Total Defense/IT Portfolio21,055 $608,584 100.0 %$35.08 
(a)Subsequent to quarter end, we executed standstill agreements with the USG extending the expiration of 115,000 square feet within the Ft Meade/BW Corridor into 2025.
21
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Lease Expiration Analysis as of 9/30/24 (1) (continued)
(dollars and square feet in thousands, except per square foot amounts)
Segment of Lease and Year of Expiration (2)Square Footage of Leases ExpiringAnnualized Rental
Revenue of Expiring Leases (3)
% of Total
Annualized 
Rental
Revenue
Expiring (3)
Annualized Rental
Revenue of
Expiring Leases per Occupied Sq. Foot (3)
Total Defense/IT Portfolio21,055 $608,584 90.1 %$35.08 
Other
         202414 445 0.1 %32.47 
         2025156 10,381 1.5 %28.30 
         2026167 6,152 0.9 %36.75 
         2027116 4,295 0.6 %36.75 
         2028247 9,215 1.4 %37.13 
Thereafter871 36,328 5.4 %41.46 
Total Other1,571 66,816 9.9 %38.54 
Total Portfolio22,626 $675,400 100.0 %$35.37 
Consolidated Portfolio18,331 $667,572 
Unconsolidated JV Properties4,295 $7,828 
Note: As of 9/30/24, the weighted average lease term was 5.2 years for the total portfolio, 5.1 years for the Defense/IT portfolio and 5.0 years for the consolidated portfolio.

(1)This expiration analysis reflects consolidated and unconsolidated properties and includes the effect of early renewals completed on existing leases but excludes the effect of new tenant leases on square feet yet to commence as of 9/30/24. With regard to properties owned through unconsolidated real estate joint ventures, the amounts reported above reflect 100% of the properties’ square footage but only reflect the portion of Annualized Rental Revenue that was allocable to COPT Defense’s ownership interest.
(2)The year of lease expiration is based on the lease term determined in accordance with GAAP.
(3)Refer to the section entitled “Definitions” for a definition of annualized rental revenue.
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22
3Q 2024 Supplemental Information Package
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COPT Defense Properties
2025 Defense/IT Portfolio Quarterly Lease Expiration Analysis as of 9/30/24 (1)
(dollars and square feet in thousands, except per square foot amounts)
Segment of Lease and Quarter of Expiration (2)Square Footage of Leases ExpiringAnnualized Rental
Revenue of Expiring Leases (3)
% of Defense/IT
Annualized
Rental
Revenue Expiring (3)
Annualized Rental Revenue of Expiring Leases per Occupied Sq. Foot (3)
Defense IT Portfolio
Ft Meade/BW Corridor674 $28,632 4.7 %$42.45 
NoVA Defense/IT295 — %34.01 
Navy Support58 810 0.1 %13.90 
Redstone Arsenal173 — %27.90 
Q1 2025747 29,910 4.8 %40.01 
Ft Meade/BW Corridor347 11,331 1.9 %32.63 
NoVA Defense/IT23 710 0.1 %30.28 
Navy Support66 2,289 0.4 %34.43 
Redstone Arsenal41 1,090 0.2 %26.64 
Q2 2025477 15,420 2.6 %32.26 
Ft Meade/BW Corridor257 10,586 1.7 %41.10 
NoVA Defense/IT28 1,027 0.2 %37.19 
Lackland Air Force Base161 7,686 1.3 %47.87 
Navy Support23 597 0.1 %25.99 
Redstone Arsenal185 4,197 0.7 %22.73 
Q3 2025654 24,093 4.0 %36.87 
Ft Meade/BW Corridor332 11,856 1.9 %35.69
NoVA Defense/IT28 1,040 0.2 %37.26 
Lackland Air Force Base542 38,230 6.3 %70.52 
Navy Support51 1,285 0.2 %25.13 
Redstone Arsenal33 911 0.1 %27.65 
Q4 2025986 53,322 8.7 %54.06 
2,864 $122,745 20.2 %$42.84 
(1)This expiration analysis reflects consolidated and unconsolidated properties and includes the effect of early renewals completed on existing leases but excludes the effect of new tenant leases on square feet yet to commence as of 9/30/24.
(2)The period of lease expiration is based on the lease term determined in accordance with GAAP.
(3)Refer to the section entitled “Definitions” for a definition of annualized rental revenue.

23
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Top 20 Tenants as of 9/30/24 (1)
(dollars and square feet in thousands)
TenantTotal
Annualized
Rental Revenue (2)
%
of Total
Annualized 
Rental Revenue (2)
Occupied Square FeetWeighted Average Remaining Lease Term (3)
United States Government(4)$244,675 36.2 %5,533 3.5 
Fortune 100 Company61,261 9.1 %6,182 7.7 
General Dynamics Corporation33,282 4.9 %703 3.1 
Northrop Grumman Corporation15,112 2.2 %519 6.5 
The Boeing Company14,958 2.2 %443 2.4 
CACI International Inc 14,043 2.1 %350 3.9 
Peraton Corp. 13,602 2.0 %346 5.0 
Booz Allen Hamilton, Inc. 12,224 1.8 %297 1.8 
Fortune 100 Company 12,003 1.8 %183 10.0 
Morrison & Foerster, LLP 9,631 1.4 %102 12.5 
CareFirst, Inc.9,067 1.3 %264 9.9 
KBR, Inc. 7,791 1.2 %309 8.6 
Amentum Holdings, LLC 7,206 1.1 %202 4.3 
Yulista Holding, LLC 7,193 1.1 %368 5.2 
AT&T Corporation 6,906 1.0 %321 5.0 
Mantech International Corp. 6,716 1.0 %208 2.7 
The University System of Maryland 6,302 0.9 %176 5.3 
Wells Fargo & Company 5,855 0.9 %134 4.3 
Lockheed Martin Corporation 5,789 0.9 %194 5.9 
Miles & Stockbridge, P.C. 5,440 0.8 %130 4.2 
Subtotal Top 20 Tenants 499,056 73.9 %16,964 5.5 
All remaining tenants 176,344 26.1 %5,662 4.3 
Total / Weighted Average $675,400 100.0 %22,626 5.2 

(1)For properties owned through unconsolidated real estate JVs, includes COPT Defense’s share of those properties’ ARR of $7.8 million (see page 34 for additional information).
(2)Refer to the section entitled “Definitions” for a definition of annualized rental revenue.
(3)Weighted average remaining lease term is based on the lease term determined in accordance with GAAP. The weighting of the lease term was computed based on occupied square feet (excluding leases not associated with square feet, such as ground leases).
(4)Substantially all of our government leases are subject to early termination provisions which are customary in government leases. As of 9/30/24, $5.7 million of our ARR was through the General Services Administration (GSA), representing 2.3% of our ARR from the United States Government and 0.8% of our total ARR.






24
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Operating Property Acquisitions
(square feet in thousands)
% Leased
PropertyProperty Segment/Sub-SegmentLocation# of PropertiesOperational Square FeetTransaction
Date
As of Transaction Date
As of 9/30/24
Transaction Value
(in millions)
Quarter Ended 3/31/24
6841 Benjamin Franklin DriveFort Meade/BW CorridorColumbia, Maryland1202 3/15/2455.6%55.6%$15 
Quarter Ended 9/30/24
3900 Rogers RoadLackland Air Force BaseSan Antonio, Texas180 9/26/24—%100.0%17 
Year to date acquisitions through 9/30/24
2282 $32 


25
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Summary of Development Projects as of 9/30/24 (1)
(dollars and square feet in thousands) 
Total Rentable Square Feet
% Leased as of 9/30/24
as of 9/30/24 (2)
Actual or Anticipated Shell Completion DateAnticipated Operational Date (3)
Anticipated Total CostCost to DateCost to Date Placed in Service
Property and Segment/Sub-SegmentLocation
Defense/IT Portfolio:
Fort Meade/BW Corridor:
400 National Business ParkwayAnnapolis Junction, Maryland138 0%$65,100 $33,469 $— 1Q 251Q 26
Redstone Arsenal:
9700 Advanced Gateway Huntsville, Alabama50 20%11,038 3,654 — 1Q 251Q 26
Data Center Shells:
Southpoint Phase 2 Bldg ANorthern Virginia225 100%82,500 53,389 — 4Q 244Q 24
MP 3Northern Virginia225 100%111,800 11,222 — 3Q 253Q 25
Southpoint Phase 2 Bldg BNorthern Virginia193 100%65,000 6,343 — 4Q 254Q 25
Data Center Shells Subtotal / Average643 100%259,300 70,954 — 
Total Defense/IT Portfolio Under Development831 79%$335,438 $108,077 $   
(1)Includes properties under, or contractually committed for, development as of 9/30/24.
(2)Cost includes land, development, leasing costs and allocated portion of structured parking and other shared infrastructure, if applicable.
(3)Anticipated operational date is the earlier of the estimated date when leases have commenced on 100% of a property’s space or one year from the cessation of major construction activities.





26
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Development Placed in Service as of 9/30/24
(square feet in thousands)
 
Square Feet Placed in Service
Total Space Placed in Service % Leased as of 9/30/24
Total Property
Property Segment/Sub-Segment
% Leased as of 9/30/24
Rentable Square Feet2024
Property and Location1st Quarter2nd Quarter3rd Quarter
Total 2024
5300 Redstone Gateway
Huntsville, Alabama
Redstone Arsenal100%46 46 — — 46 100%
8100 Rideout Road
Huntsville, Alabama
Redstone Arsenal42%128 27 — 101 128 42%
Total Development Placed in Service57%174 73  101 174 57%
% Leased as of 9/30/24
100%N/A26%57%

27
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Summary of Land Owned/Controlled as of 9/30/24 (1)
(dollars and square feet in thousands)
LocationAcres Estimated Developable Square FeetCarrying Amount
Defense/IT Portfolio land owned/controlled for future development:   
Fort Meade/BW Corridor:
National Business Park1441,483
Howard County19290
Other1261,338
Total Fort Meade/BW Corridor289 3,111
NoVA Defense/IT29 1,171
Navy Support3864
Redstone Arsenal (2)2953,350
Data Center Shells (3)3653,300
Total Defense/IT Portfolio land owned/controlled for future development1,01610,996$196,999 
Other land owned/controlled53 1,5389,653 
Land held, net1,06912,534$206,652 

(1)This land inventory schedule includes properties under ground lease to us and excludes all properties listed as development as detailed on page 26. The costs associated with the land included on this summary are reported on our consolidated balance sheet in the line entitled “land held.”
(2)This land is controlled under a long-term master lease agreement to LW Redstone Company, LLC, a consolidated JV (see page 33). As this land is developed in the future, the JV will execute site-specific leases under the master lease agreement. Lease payments will commence under the site-specific leases as cash rents under tenant leases commence at the respective properties.
(3)Represents land acquired in September 2024.
28
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Capitalization Overview
(dollars, shares and units in thousands)
Wtd. Avg. Maturity (Years) (1)Stated RateEffective Rate
(2)(3)
Amount Outstanding at 9/30/24
Debt
Secured debt1.35.24 %3.18 %$70,161 
Unsecured debt5.13.25 %3.34 %2,345,311 
Total Consolidated Debt5.03.31 %3.33 %$2,415,472 
Fixed-rate debt (3)5.22.96 %3.33 %$2,415,472 
Variable-rate debt (3)2.96.56 %N/A— 
Total Consolidated Debt$2,415,472 
Common Equity
Common Shares112,693 
Common Units (4)2,117 
Total Common Shares and Units114,810 
Closing Common Share Price on 9/30/24
$30.33 
Equity Market Capitalization (5)$3,482,187 
Total Market Capitalization (5)$5,897,659 
(1)Calculated assuming exercise of extension options on our Revolving Credit Facility and term loan.
(2)Excludes the effect of deferred financing cost amortization.
(3)Includes the effect of interest rate swaps with notional amounts totaling $232.7 million that hedge the risk of changes in interest rates on variable-rate debt. We had swaps in place for all of our variable-rate debt balances as of 9/30/24.
(4)Includes certain unvested share-based compensation awards in the form of profit interest units.
(5)Refer to the section entitled “Definitions” for a definition of this measure.











Investment Grade Ratings & OutlookLatest Report
FitchBBB-Stable11/22/23
Moody’sBaa3Stable1/22/24
S&PBBB-Stable5/9/24
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29
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Summary of Outstanding Debt as of 9/30/24
(dollars in thousands)
Unsecured DebtStated RateAmount OutstandingMaturity DateSecured DebtStated RateAmount OutstandingBalloon Payment Due Upon MaturityMaturity Date
Revolving Credit FacilitySOFR+
0.10%+1.05%
$75,000 Oct-26(1)(2)LW Redstone:
4000 & 4100 Market Street and 8800 Redstone Gateway (2)(3) SOFR
+0.10%+1.55%
$22,250 $22,100 Mar-25(5)
Senior Unsecured Notes
2.25% due 20262.25%400,000 Mar-26M Square:
5.25% due 20285.25%345,000 Sep-28(4)5825 & 5850 University Research Court (3) 3.82%37,451 $35,603 Jun-26
2.00% due 20292.00%400,000 Jan-29
2.75% due 20312.75%600,000 Apr-315801 University Research Court (2)(3)SOFR
+0.10%+1.45%
10,460 $10,020 Aug-26
2.90% due 20332.90%400,000 Dec-33
Subtotal - Senior Unsecured Notes2.95%$2,145,000 Total Secured Debt5.24%$70,161 
Unsecured Bank Term Loans
2026 MaturitySOFR+
0.10%+1.30%
$125,000 Jan-26(2)(6)
Other Unsecured Debt0.00%311 May-26
Total Unsecured Debt3.25%$2,345,311 
Debt Summary
Total Unsecured Debt3.25%$2,345,311 
Total Secured Debt5.24%70,161 
Consolidated Debt3.31%$2,415,472 
Debt per balance sheet$2,390,839 
Net discounts and deferred financing costs24,633 
Consolidated Debt2,415,472 
COPT Defense’s share of unconsolidated JV gross debt (7)53,148 
Gross debt$2,468,620 
(1)The Company’s $600.0 million Revolving Credit Facility matures in October 2026 and may be extended by two six-month periods at our option.
(2)Pre-payable anytime without penalty.
(3)These properties are owned through consolidated joint ventures.
(4)These notes are due in 2028 unless earlier exchanged, redeemed or repurchased only in the event of certain circumstances and during certain periods defined under the terms of the notes. Upon exchange of the notes, the principal amount of notes exchanged is payable in cash, with the remainder of the exchange obligation, if any, payable in cash, common shares or a combination thereof at our election.
(5)The loan maturity may be extended for two one-year periods, provided certain conditions are met.
(6)The Company’s term loan matures in January 2026 and may be extended by two 12-month periods at our option.
(7)See page 34 for additional disclosure regarding our unconsolidated real estate joint ventures.

30
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Summary of Outstanding Debt as of 9/30/24 (continued)

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(1)Revolving Credit Facility maturity of $75.0 million is included above in 2027 assuming our exercise of two six-month extension options.
(2)Term loan balance of $125.0 million is included in 2028 assuming our exercise of two 12-month extension options. Also includes $345.0 million principal amount of exchangeable senior notes due in 2028 unless earlier exchanged, redeemed or repurchased only in the event of certain circumstances and during certain periods defined under the terms of the notes.
(3)Includes the effect of interest rate swaps with notional amounts totaling $232.7 million that hedge the risk of changes in interest rates on variable-rate debt.
31
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Debt Analysis
(dollars and square feet in thousands)
As of and for Three Months Ended
9/30/24
As of and for Three Months Ended
9/30/24
Senior Note Covenants (1)RequiredLine of Credit & Term Loan Covenants (1)(2)Required
Total Debt / Total Assets< 60%41.6%Total Debt / Total Assets< 60%37.2%
Secured Debt / Total Assets< 40%1.2%Secured Debt / Total Assets< 40%1.5%
Debt Service Coverage> 1.5x4.7xAdjusted EBITDA / Fixed Charges> 1.5x4.8x
Unencumbered Assets / Unsecured Debt> 150%240.7%Unsecured Debt / Unencumbered Assets< 60%37.2%
Unencumbered Adjusted NOI / Unsecured Interest Expense> 1.75x4.9x
Debt RatiosPage Refer.Unencumbered Portfolio Analysis
GAAP# of unencumbered properties177 
Debt per balance sheet6$2,390,839 % of total portfolio88 %
Total assets6$4,234,302 Unencumbered square feet in-service20,667 
Debt to assets56.5 %% of total portfolio85 %
Net income7$37,397 NOI from unencumbered real estate operations$102,253 
Debt to net income ratio (2)16.0 x% of total NOI from real estate operations97 %
Interest expense7$20,376 Adjusted EBITDA from unencumbered real estate operations$95,963 
Net income to interest expense ratio (2)1.8 x% of total adjusted EBITDA from real estate operations97 %
Unencumbered adjusted book$5,766,845 
Non-GAAP% of total adjusted book97 %
Net debt37$2,432,567 
Adjusted book37$5,967,380 
Net debt to adjusted book40.8 %
Net debt adj. for fully-leased investment properties37$2,344,579 
In-place adjusted EBITDA11$99,236 
Net debt to in-place adjusted EBITDA ratio 6.1 x
Net debt adj. for fully-leased investment properties to in-place adj. EBITDA ratio5.9 x
Denominator for debt service coverage36$19,942 
Denominator for fixed charge coverage36$20,654 
Adjusted EBITDA11$99,236 
Adjusted EBITDA debt service coverage ratio5.0 x
Adjusted EBITDA fixed charge coverage ratio4.8 x
(1)The covenants are calculated as defined in the applicable agreements, and the calculations differ between those agreements.
(2)Refer to the section entitled “Definitions” for a definition of this measure.
32
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Consolidated Real Estate Joint Ventures as of 9/30/24
(dollars and square feet in thousands)

NOI from Real Estate Operations (1)Venture Level Debt Outstanding (3)COPT Defense Nominal
Ownership %
Operating PropertiesOperational
Square Feet
% Occupied% LeasedThree Months EndedNine Months EndedTotal Assets (2)
Suburban Maryland:      
M Square Associates, LLC (4 properties)
414 88.8%95.5%$1,812 $5,227 $91,351 $47,911 50%
Huntsville, Alabama:
LW Redstone Company, LLC (23 properties)
2,338 95.9%96.2%11,413 32,980 621,035 22,250 85%(4)
Washington, D.C.:
Stevens Place (1 property)
188 61.9%92.2%1,319 4,068 130,342 — 95%
Total / Average2,940 92.8%95.8%$14,544 $42,275 $842,728 $70,161 
 
        
Non-Operating PropertiesEstimated Developable Square FeetTotal Assets (2)Venture Level Debt OutstandingCOPT Defense Nominal Ownership %
Suburban Maryland:    
M Square Research Park348 $5,922 $— 50%
Huntsville, Alabama:    
Redstone Gateway (5)3,400 119,683 — 85%(3)
Total3,748 $125,605 $  
 
(1)Represents NOI from real estate operations of the JV operating properties before allocation to JV partners.
(2)Total assets includes the assets of the consolidated JV plus any outside investment basis.
(3)Excludes debt from us to the JV, which is eliminated in the presentation of our consolidated financial statements.
(4)Our partner receives an annual priority return of 13.5% on its $9.0 million in contributed equity, plus certain fees for leasing and development, and we expect to receive all other distributions from the JV.
(5)Total assets include $83.2 million in notes receivable due from the City of Huntsville (including accrued interest and excluding allowance for credit losses) in connection with infrastructure costs funded by the JV.
33
3Q 2024 Supplemental Information Package
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COPT Defense Properties
Unconsolidated Real Estate Joint Ventures as of 9/30/24 (1)
(dollars and square feet in thousands) 
Joint venture information
COPT Defense ownership %
10 %
COPT Defense’s investment
$36,350 (2)
# of Properties24 
Square Feet4,295 
% Occupied100 %
COPT Defense’s share of ARR$7,828 
Balance sheet informationTotalCOPT Defense’s Share (4)
Operating properties, net$943,209 $94,321 
Total assets$1,041,128 $104,113 
Debt (3)$530,015 $53,002 
Total liabilities$611,178 $61,118 
Three Months EndedNine Months Ended
Operating information TotalCOPT Defense’s Share (4)TotalCOPT Defense’s Share (4)
Revenue$21,819 $2,182 $63,594 $6,360 
Operating expenses(3,377)(338)(10,406)(1,041)
NOI from real estate operations and EBITDAre (5)18,442 1,844 53,188 5,319 
Interest expense(10,038)(1,003)(28,284)(2,828)
Depreciation and amortization(8,022)(756)(24,497)(2,311)
Net income$382 $85 $407 $180 
NOI from real estate operations (per above) (5)$18,442 $1,844 $53,188 $5,319 
Straight line rent adjustments(892)(89)(2,081)(208)
Amortization of acquired above- and below-market rents(1,899)(190)(5,876)(588)
Cash NOI from real estate operations (5)$15,651 $1,565 $45,231 $4,523 
(1)Includes equity method investments in five JVs that own and operate data center shell properties.
(2)Includes $39.7 million reported in “Investment in unconsolidated real estate joint ventures” and $3.4 million for investments with deficit balances reported in “other liabilities” on our consolidated balance sheet.
(3)Maturities on JV debt range from 2027 (assuming exercise of three one-year extension options) to 2030.
(4)Represents the portion allocable to our ownership interest.
(5)Refer to the section entitled “Definitions” for definitions of these measures.



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3Q 2024 Supplemental Information Package
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COPT Defense Properties
Supplementary Reconciliations of Non-GAAP Measures
(in thousands)
 Three Months EndedNine Months Ended
 9/30/246/30/243/31/2412/31/239/30/239/30/249/30/23
Net income (loss)$37,397 $36,407 $33,671 $34,820 $(221,207)$107,475 $(109,167)
Construction contract and other service revenues(16,662)(20,258)(26,603)(18,167)(11,949)(63,523)(42,012)
Depreciation and other amortization associated with real estate operations38,307 38,161 38,351 36,735 37,620 114,819 112,215 
Construction contract and other service expenses16,127 19,612 26,007 17,167 11,493 61,746 40,249 
Impairment losses— — — — 252,797 — 252,797 
General and administrative expenses8,157 8,591 8,378 8,240 7,582 25,126 22,865 
Leasing expenses2,341 2,462 2,187 2,308 2,280 6,990 6,624 
Business development expenses and land carry costs918 979 1,182 797 714 3,079 1,935 
Interest expense20,376 20,617 20,767 20,383 17,798 61,760 50,759 
Interest and other income, net(3,324)(2,884)(4,122)(5,659)(2,529)(10,330)(6,928)
Gain on sales of real estate — — — — — — (49,392)
Equity in (income) loss of unconsolidated entities(85)(26)(69)240 68 (180)21 
Unconsolidated real estate JVs NOI allocable to COPT Defense included in equity in income (loss) of unconsolidated entities (1)1,844 1,735 1,740 1,671 1,675 5,319 4,988 
Income tax expense130 14 168 121 152 312 467 
NOI from real estate operations105,526 105,410 101,657 98,656 96,494 312,593 285,421 
Straight line rent adjustments and lease incentive amortization1,017 4,213 3,632 703 13,262 8,862 6,528 
Amortization of acquired above- and below-market rents64 64 (24)(121)(120)104 (415)
Amortization of intangibles and other assets to property operating expenses147 146 147 146 147 440 440 
Lease termination fees, net(931)(880)(775)(716)(748)(2,586)(3,028)
Tenant funded landlord assets and lease incentives(4,415)(7,318)(10,439)(7,548)(19,383)(22,172)(22,834)
Cash NOI adjustments in unconsolidated real estate JVs(279)(254)(263)(271)(279)(796)(856)
Cash NOI from real estate operations$101,129 $101,381 $93,935 $90,849 $89,373 $296,445 $265,256 
NOI from real estate operations (from above)$105,526 $105,410 $101,657 $98,656 $96,494 $312,593 $285,421 
Non-Same Property NOI from real estate operations(6,875)(6,738)(6,254)(3,802)(1,455)(19,867)(3,436)
Same Property NOI from real estate operations98,651 98,672 95,403 94,854 95,039 292,726 281,985 
Straight line rent adjustments and lease incentive amortization1,531 2,501 5,367 3,142 10,154 9,399 3,888 
Amortization of acquired above- and below-market rents(69)(69)(69)(121)(120)(207)(415)
Lease termination fees, net(931)(881)(775)(717)(748)(2,587)(3,028)
Tenant funded landlord assets and lease incentives(1,942)(2,498)(8,190)(7,541)(15,402)(12,630)(18,837)
Cash NOI adjustments in unconsolidated real estate JVs(136)(111)(117)(124)(130)(364)(420)
Same Property Cash NOI from real estate operations$97,104 $97,614 $91,619 $89,493 $88,793 $286,337 $263,173 
(1)See page 34 for additional disclosure regarding our unconsolidated real estate JVs.
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3Q 2024 Supplemental Information Package
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COPT Defense Properties
Supplementary Reconciliations of Non-GAAP Measures (continued)
(in thousands)
 Three Months EndedNine Months Ended
 9/30/246/30/243/31/2412/31/239/30/239/30/249/30/23
Real estate revenues
Lease revenue
Fixed contractual payments$129,357 $127,363 $126,198 $123,677 $120,408 $382,918 $354,908 
Variable lease payments (1)41,192 38,256 39,235 36,660 34,860 118,683 104,602 
Lease revenue170,549 165,619 165,433 160,337 155,268 501,601 459,510 
Other property revenue2,014 1,466 1,230 1,225 1,339 4,710 3,731 
Real estate revenues$172,563 $167,085 $166,663 $161,562 $156,607 $506,311 $463,241 
Provision for credit losses (recoveries) on billed lease revenue$25 $(24)$(109)$498 $13 $(108)$86 
Total revenues $189,225 $187,343 $193,266 $179,729 $168,556 $569,834 $505,253 
Construction contract and other service revenues(16,662)(20,258)(26,603)(18,167)(11,949)(63,523)(42,012)
Real estate revenues$172,563 $167,085 $166,663 $161,562 $156,607 $506,311 $463,241 
Total interest expense$20,376 $20,617 $20,767 $20,383 $17,798 $61,760 $50,759 
Less: Amortization of deferred financing costs(671)(681)(685)(681)(639)(2,037)(1,899)
Less: Amortization of net debt discounts, net of amounts capitalized(1,032)(1,023)(1,014)(1,004)(750)(3,069)(1,990)
COPT Defense’s share of interest expense of unconsolidated real estate JVs, excluding amortization of deferred financing costs and net debt premium and gain or loss on interest rate derivatives821 808 804 819 805 2,433 2,369 
Denominator for interest coverage19,494 19,721 19,872 19,517 17,214 59,087 49,239 
Scheduled principal amortization448 662 769 763 753 1,879 2,289 
Denominator for debt service coverage19,942 20,383 20,641 20,280 17,967 60,966 51,528 
Capitalized interest712 643 589 1,028 1,487 1,944 3,451 
Denominator for fixed charge coverage$20,654 $21,026 $21,230 $21,308 $19,454 $62,910 $54,979 
Dividends on unrestricted common and deferred shares$33,165 $33,153 $33,143 $31,998 $31,996 $99,461 $95,980 
Distributions on unrestricted common units491 505 500 430 432 1,496 1,295 
Dividends and distributions on restricted shares and units247 238 267 209 200 752 619 
Total dividends and distributions for GAAP payout ratio33,903 33,896 33,910 32,637 32,628 101,709 97,894 
Dividends and distributions on antidilutive shares and units(249)(241)(266)(212)(202)(756)(623)
Dividends and distributions for non-GAAP payout ratios$33,654 $33,655 $33,644 $32,425 $32,426 $100,953 $97,271 
(1)Represents primarily lease revenue associated with property operating expense reimbursements from tenants.
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COPT Defense Properties
Supplementary Reconciliations of Non-GAAP Measures (continued)
(in thousands)
9/30/246/30/243/31/2412/31/239/30/23
Total assets$4,234,302 $4,219,338 $4,232,895 $4,246,966 $4,239,257 
Accumulated depreciation1,502,730 1,468,595 1,434,621 1,400,162 1,367,473 
Accumulated amortization of intangibles on property acquisitions and deferred leasing costs227,281 226,739 225,443 228,484 228,334 
COPT Defense’s share of liabilities of unconsolidated real estate JVs61,118 60,922 60,904 60,583 60,762 
COPT Defense’s share of accumulated depreciation and amortization of unconsolidated real estate JVs12,014 11,199 10,364 9,528 8,664 
Less: Property - operating lease liabilities(33,615)(33,818)(33,141)(33,931)(32,940)
Less: Property - finance lease liabilities(397)(403)(409)(415)(420)
Less: Cash and cash equivalents(34,478)(100,443)(123,144)(167,820)(204,238)
Less: COPT Defense’s share of cash of unconsolidated real estate JVs(1,575)(1,278)(1,159)(852)(1,031)
Adjusted book$5,967,380 $5,850,851 $5,806,374 $5,742,705 $5,665,861 
Gross debt (page 30)
$2,468,620 $2,468,901 $2,497,050 $2,497,613 $2,498,274 
Less: Cash and cash equivalents(34,478)(100,443)(123,144)(167,820)(204,238)
Less: COPT Defense’s share of cash of unconsolidated real estate JVs(1,575)(1,278)(1,159)(852)(1,031)
Net debt2,432,567 2,367,180 2,372,747 2,328,941 2,293,005 
Costs incurred on fully-leased development properties(70,954)(56,646)(43,034)(53,914)(124,038)
Costs incurred on fully-leased operating property acquisitions(17,034)— — — — 
Net debt adjusted for fully-leased investment properties$2,344,579 $2,310,534 $2,329,713 $2,275,027 $2,168,967 

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3Q 2024 Supplemental Information Package
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COPT Defense Properties
Definitions
Non-GAAP Measures

We believe that the measures defined below that are not determined in accordance with generally accepted accounting principles (“GAAP”) are helpful to investors in measuring our performance and comparing it to that of other real estate investment trusts (“REITs”).  Since these measures exclude certain items includable in their respective most comparable GAAP measures, reliance on the measures has limitations; management compensates for these limitations by using the measures simply as supplemental measures that are weighed in balance with other GAAP and non-GAAP measures.  These measures should not be used as an alternative to the respective most comparable GAAP measures when evaluating our financial performance or to cash flow from operating, investing and financing activities when evaluating our liquidity or ability to make cash distributions or pay debt service.
 
Adjusted book
Defined as total assets presented on our consolidated balance sheet, net of lease liabilities associated with property right-of-use assets, and excluding the effect of cash and cash equivalents, accumulated depreciation on real estate properties, accumulated amortization of intangible assets on real estate acquisitions, accumulated amortization of deferred leasing costs and unconsolidated real estate joint ventures (“JVs”) cash and cash equivalents, liabilities and accumulated depreciation and amortization (of intangibles on property acquisitions and deferred leasing costs) allocable to our ownership interest in the JVs. We use adjusted book for purposes of calculating our net debt to adjusted book, which we believe is a useful supplemental measure for investors to use in further understanding the relationship of our outstanding debt to our assets available to service such debt. We believe that total assets is the most directly comparable GAAP measure to this non-GAAP measure.

Adjusted earnings before interest, income taxes, depreciation and amortization (“Adjusted EBITDA”)
Adjusted EBITDA is net income or loss adjusted for the effects of interest expense, depreciation and amortization, gain on sales and impairment losses of real estate and investments in unconsolidated real estate JVs, gain or loss on early extinguishment of debt, loss on interest rate derivatives, net gain or loss on other investments, credit loss expense or recoveries, operating property acquisition costs, income taxes, business development expenses, demolition costs on redevelopment and nonrecurring improvements, executive transition costs and certain other expenses that we believe are not relevant to an investor’s evaluation of our ability to repay debt.  Adjusted EBITDA also includes adjustments to net income or loss for the effects of the items noted above pertaining to unconsolidated real estate JVs that were allocable to our ownership interest in the JVs. While EBITDA (earnings before interest, taxes, depreciation and amortization) is a universally-defined supplemental measure, Adjusted EBITDA incorporates additional adjustments for gains and losses from investing and financing activities and certain other items that we believe represent costs that are not closely correlated to (or associated with) our operating performance and are not relevant to an
investor’s evaluation of our ability to repay debt. We believe that adjusted EBITDA is a useful supplemental measure for assessing our un-levered performance and ability to repay outstanding debt from operations.  We believe that net income or loss is the most directly comparable GAAP measure to this non-GAAP measure.
 
Adjusted EBITDA debt service coverage ratio 
This measure divides Adjusted EBITDA by the sum of interest expense (excluding amortization of deferred financing costs and amortization of debt discounts and premiums, net of amounts capitalized, and gains or losses on interest rate derivatives) and scheduled principal amortization on mortgage loans.

Amortization of acquisition intangibles included in NOI
Represents the amortization of intangible asset and liability categories that is included in net operating income, including amortization of above- or below-market leases and above- or below-market cost arrangements.

Basic FFO available to common share and common unit holders (“Basic FFO”) 
This measure is FFO adjusted to subtract (1) preferred share dividends, (2) income or loss attributable to noncontrolling interests through ownership of preferred units in COPT Defense Properties, L.P. (the “Operating Partnership”) or interests in other consolidated entities not owned by us, (3) depreciation and amortization allocable to noncontrolling interests in other consolidated entities, (4) Basic FFO allocable to share-based compensation awards and (5) issuance costs associated with redeemed preferred shares.  With these adjustments, Basic FFO represents FFO available to common shareholders and holders of common units in the Operating Partnership (“common units”).  Common units are substantially similar to our common shares of beneficial interest (“common shares”) and are exchangeable into common shares, subject to certain conditions.  We believe that Basic FFO is useful to investors due to the close correlation of common units to common shares.  We believe that net income or loss is the most directly comparable GAAP measure to this non-GAAP measure.

Cash net operating income (“Cash NOI”) 
Defined as NOI from real estate operations adjusted to eliminate the effects of: straight-line rental adjustments, amortization of tenant incentives, amortization of intangibles and other assets included in FFO and NOI, lease termination fees from tenants to terminate their lease obligations prior to the end of the agreed upon lease terms and rental revenue recognized under GAAP resulting from landlord assets and lease incentives funded by tenants.  Cash NOI also includes adjustments to NOI from real estate operations for the effects of the items noted above pertaining to unconsolidated real estate JVs that were allocable to our ownership interest in the JVs. Under GAAP, rental revenue is recognized evenly over the term of tenant leases (through straight-line rental adjustments and amortization of tenant incentives), which, given the long term nature of our leases, does not align with the economics of when tenant payments are due to us under the arrangements.  Also under GAAP, when a property is acquired, we allocate the
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COPT Defense Properties
Definitions
acquisition to certain intangible components, which are then amortized into NOI over their estimated lives, even though the resulting revenue adjustments are not reflective of our lease economics.  In addition, revenue from lease termination fees and tenant-funded landlord improvements, absent an adjustment from us, would result in large one-time lump sum amounts in Cash NOI that we do not believe are reflective of a property’s long-term value.  We believe that Cash NOI is a useful supplemental measure of operating performance for a REIT’s operating real estate because it makes adjustments to NOI for the above stated items to be more reflective of the economics of when tenant payments are due to us under our leases and the value of our properties.  As is the case with NOI, the measure is useful in our opinion in evaluating and comparing the performance of reportable segments, Same Property groupings and individual properties.  We believe that net income or loss is the most directly comparable GAAP measure to this non-GAAP measure.

COPT Defense’s share of NOI from unconsolidated real estate JVs
Represents the net of revenues and property operating expenses of real estate operations owned through unconsolidated JVs that are allocable to COPT Defense’s ownership interest. This measure is included in the computation of NOI, our segment performance measure, as discussed below.

Diluted adjusted funds from operations available to common share and common unit holders (“Diluted AFFO”) 
Defined as Diluted FFO, as adjusted for comparability, adjusted for the following: (1) the elimination of the effect of (a) noncash rental revenues and property operating expenses (comprised of straight-line rental adjustments, which includes the amortization of recurring tenant incentives, and amortization of acquisition intangibles included in FFO and NOI, both of which are described under “Cash NOI” above), (b) share-based compensation, net of amounts capitalized, (c) amortization of deferred financing costs, (d) amortization of debt discounts and premiums and (e) amortization of settlements of debt hedges; and (2) replacement capital expenditures (defined below).  Diluted AFFO also includes adjustments to Diluted FFO, as adjusted for comparability for the effects of the items noted above pertaining to unconsolidated real estate JVs that were allocable to our ownership interest in the JVs. We believe that Diluted AFFO is a useful supplemental measure of operating performance for a REIT because it incorporates adjustments for: certain revenue and expenses that are not associated with cash to or from us during the period; and certain capital expenditures for operating properties incurred during the period that do require cash outlays.  We believe that net income or loss is the most directly comparable GAAP measure to this non-GAAP measure.

Diluted FFO available to common share and common unit holders (“Diluted FFO”) 
Diluted FFO is Basic FFO adjusted to add back any changes in Basic FFO that would result from the assumed conversion of securities that are convertible or exchangeable into common shares.  The computation of Diluted FFO assumes the conversion of common units but does not assume the conversion of other securities that are
convertible into common shares if the conversion of those securities would increase Diluted FFO per share in a given period.  We believe that Diluted FFO (which includes discontinued operations, if any) is useful to investors because it is the numerator used to compute Diluted FFO per share, discussed below.  We believe that net income or loss is the most directly comparable GAAP measure to this non-GAAP measure.

Diluted FFO available to common share and common unit holders, as adjusted for comparability (“Diluted FFO, as adjusted for comparability”)
Defined as Diluted FFO or FFO adjusted to exclude: operating property acquisition costs (for acquisitions classified as business combinations); gain or loss on early extinguishment of debt; FFO associated with properties that secured non-recourse debt on which we defaulted and, subsequently, extinguished via conveyance of such properties (including property NOI, interest expense and gains on debt extinguishment); loss on interest rate derivatives; executive transition costs associated with named executive officers; and, for periods prior to 10/1/22, demolition costs on redevelopment and nonrecurring improvements and executive transition costs associated with other senior management team members.  Diluted FFO, as adjusted for comparability also includes adjustments to Diluted FFO for the effects of the items noted above pertaining to unconsolidated real estate JVs that were allocable to our ownership interest in the JVs. We believe this to be a useful supplemental measure alongside Diluted FFO as it excludes gains and losses from certain investing and financing activities and certain other items that we believe are not closely correlated to (or associated with) our operating performance. We believe that net income or loss is the most directly comparable GAAP measure to this non-GAAP measure.

Diluted FFO per share
Diluted FFO per share is (1) Diluted FFO divided by (2) the sum of the (a) weighted average common shares outstanding during a period, (b) weighted average common units outstanding during a period and (c) weighted average number of potential additional common shares that would have been outstanding during a period if other securities that are convertible or exchangeable into common shares were converted or exchanged.  The computation of Diluted FFO per share assumes the conversion of common units but does not assume the conversion of other securities that are convertible into common shares if the conversion of those securities would increase Diluted FFO per share in a given period.  We believe that Diluted FFO per share is useful to investors because it provides investors with a further context for evaluating our FFO results in the same manner that investors use earnings per share (“EPS”) in evaluating net income or loss available to common shareholders.  We believe that diluted EPS is the most directly comparable GAAP measure to this non-GAAP measure.

Diluted FFO per share, as adjusted for comparability 
Defined as (1) Diluted FFO available to common share and common unit holders, as adjusted for comparability divided by (2) the sum of the (a) weighted average common shares outstanding during a period, (b) weighted average common units outstanding during a period and (c) weighted average number of potential additional common shares
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COPT Defense Properties
Definitions
that would have been outstanding during a period if other securities that are convertible or exchangeable into common shares were converted or exchanged.  The computation of this measure assumes the conversion of common units but does not assume the conversion of other securities that are convertible into common shares if the conversion of those securities would increase the per share measure in a given period.  We believe this to be a useful supplemental measure alongside Diluted FFO per share as it excludes gains and losses from investing and financing activities and certain other items that we believe are not closely correlated to (or associated with) our operating performance. We believe that diluted EPS is the most directly comparable GAAP measure to this non-GAAP measure.
 
Earnings before interest, income taxes, depreciation and amortization for real estate (“EBITDAre”)
Defined as net income or loss adjusted for the effects of interest expense, depreciation and amortization, gains on sales and impairment losses of real estate and investments in unconsolidated real estate JVs, and income taxes. EBITDAre also includes adjustments to net income or loss for the effects of the items noted above pertaining to unconsolidated real estate JVs that were allocable to our ownership interest in the JVs. While EBITDA (earnings before interest, taxes, depreciation and amortization) is a universally-defined supplemental measure, EBITDAre incorporates additional adjustments for gains and losses from investing activities related to our investments in operating properties. We believe that EBITDAre is a useful supplemental measure for assessing our un-levered performance. We believe that net income or loss is the most directly comparable GAAP measure to this non-GAAP measure.

Funds from operations (“FFO” or “FFO per Nareit”)
Defined as net income or loss computed using GAAP, excluding gains on sales and impairment losses of real estate and investments in unconsolidated real estate JVs (net of associated income tax) and real estate-related depreciation and amortization. FFO also includes adjustments to net income or loss for the effects of the items noted above pertaining to unconsolidated real estate JVs that were allocable to our ownership interest in the JVs. We believe that we use the National Association of Real Estate Investment Trust’s (“Nareit”) definition of FFO, although others may interpret the definition differently and, accordingly, our presentation of FFO may differ from those of other REITs.  We believe that FFO is useful to management and investors as a supplemental measure of operating performance because, by excluding gains on sales and impairment losses of real estate (net of associated income tax) and real estate-related depreciation and amortization, FFO can help one compare our operating performance between periods.  We believe that net income or loss is the most directly comparable GAAP measure to this non-GAAP measure.

Gross debt
Defined as debt reported on our consolidated balance sheet adjusted to exclude net discounts and premiums and deferred financing costs, as further adjusted to include outstanding debt of unconsolidated real estate JVs that were allocable to our ownership
interest in the JVs. We believe that this measure is useful to investors as it represents our total outstanding debt, including our share of unconsolidated joint venture debt. We believe that debt reported on our consolidated balance sheet is the most directly comparable GAAP measure to this non-GAAP measure.

In-place adjusted EBITDA
Defined as Adjusted EBITDA, as further adjusted for: (1) certain events occurring in a three month period to reflect Adjusted EBITDA as if the events occurred at the beginning of such period, including: (a) properties acquired, placed in service or expanded upon subsequent to the commencement of a period made in order to reflect a full period of ownership/operations; (b) properties removed from service or in which we disposed of interests; (c) significant mid-period occupancy changes associated with properties recently placed in service as if such occupancy changes occurred at the beginning of such period; and (2) adjustments to deferred rental revenue associated with changes in our assessment of collectability. The measure also includes adjustments for the effects of the items noted above pertaining to unconsolidated real estate JVs that were allocable to our ownership interest in the JVs. We believe that the pro forma adjustments described above are consistent with the requirements for preparation of amounts presented on a pro forma basis in accordance with Article 11 of Regulation S-X. We believe that in-place adjusted EBITDA is a useful supplemental measure of performance for assessing our un-levered performance and ability to repay outstanding debt from operations, as further adjusted for changes in operating properties subsequent to the commencement of a quarter and for the other items noted above that we believe are not closely correlated with our operating performance and are not relevant to an investor’s evaluation of our ability to repay debt.  We believe that net income or loss is the most directly comparable GAAP measure to this non-GAAP measure.

Net debt
Defined as Gross debt (total outstanding debt reported per our balance sheet as adjusted to exclude net discounts and premiums and deferred financing costs), as adjusted to subtract cash and cash equivalents as of the end of the period. The measure also includes adjustments to Gross debt for the effects of the items noted above pertaining to unconsolidated real estate JVs that were allocable to our ownership interest in the JVs. We use net debt for purposes of calculating our net debt to adjusted book, which we believe is a useful supplemental measure for investors to use in further understanding the relationship of our outstanding debt to our assets available to service such debt. We believe that debt reported on our consolidated balance sheet is the most directly comparable GAAP measure to this non-GAAP measure.

Net debt adjusted for fully-leased investment properties
Defined as Net debt less costs incurred on properties under development and on operating property acquisitions that were 100% leased. We believe that this supplemental measure is useful in providing investors the impact to our debt of these fully leased properties that are not yet contributing to our adjusted EBITDA. We believe
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COPT Defense Properties
Definitions
that debt reported on our consolidated balance sheet is the most directly comparable GAAP measure to this non-GAAP measure.

Net debt to Adjusted book
Defined as Net debt divided by Adjusted book (defined above).

Net debt to in-place adjusted EBITDA ratio and Net debt adjusted for fully-leased investment properties to in-place adjusted EBITDA ratio
Defined as Net debt or Net debt adjusted for fully-leased investment properties divided by in-place adjusted EBITDA (defined above) for the three month period that is annualized by multiplying by four.

Net operating income from real estate operations (“NOI”)
NOI, which is our segment performance measure, includes: consolidated real estate revenues; consolidated property operating expenses; and the net of revenues and property operating expenses of real estate operations owned through unconsolidated real estate JVs that are allocable to COPT Defense’s ownership interest in the JVs. We believe that NOI is an important supplemental measure of operating performance for a REIT’s operating real estate because it provides a measure of the core real estate operations that is unaffected by depreciation, amortization, financing and general, administrative and leasing expenses; we believe this measure is particularly useful in evaluating the performance of reportable segments, Same Property groupings and individual properties.  We believe that net income or loss is the most directly comparable GAAP measure to this non-GAAP measure.

NOI fixed charge coverage ratio and Adjusted EBITDA fixed charge coverage ratio 
These measures divide either NOI from real estate operations or Adjusted EBITDA by the sum of (1) interest expense (excluding amortization of deferred financing costs and amortization of debt discounts and premiums, net of amounts capitalized, and gains or losses on interest rate derivatives), (2) scheduled principal amortization on mortgage loans, (3) capitalized interest, (4) dividends on preferred shares and (5) distributions on preferred units in the Operating Partnership not owned by us.
 
NOI interest coverage ratio and Adjusted EBITDA interest coverage ratio 
These measures divide either NOI from real estate operations or Adjusted EBITDA by interest expense (excluding amortization of deferred financing costs and amortization of debt discounts and premiums, net of amounts capitalized, gains on losses on interest rate derivatives and interest expense on debt in default to be extinguished via conveyance of properties).


Payout ratios based on: Diluted FFO; Diluted FFO, as adjusted for comparability; and Diluted AFFO
These payout ratios are defined as (1) the sum of dividends on common and deferred shares and distributions to holders of interests in the Operating Partnership to the extent they are dilutive in the respective FFO per share numerators divided by (2) the respective non-GAAP measures.

Replacement capital expenditures 
Replacement capital expenditures are defined as tenant improvements and incentives, building improvements and leasing costs incurred during the period for operating properties that are not (1) items contemplated prior to the acquisition of a property, (2) improvements associated with the expansion of a building or its improvements, (3) renovations to a building which change the underlying classification of the building (for example, from industrial to office or Class C office to Class B office), (4) capital improvements that represent the addition of something new to the property rather than the replacement of something (for example, the addition of a new heating and air conditioning unit that is not replacing one that was previously there) or (5) replacements of significant components of a building after the building has reached the end of its original useful life. Replacement capital expenditures excludes expenditures of operating properties included in disposition plans during the period that were already sold or are held for future disposition. For cash tenant incentives not due to the tenant for a period exceeding three months past the date on which such incentives were incurred, we recognize such incentives as replacement capital expenditures in the periods such incentives are due to the tenant. Replacement capital expenditures, which is included in the computation of Diluted AFFO, is intended to represent non-transformative capital expenditures of existing properties held for long-term investment. We believe that the excluded expenditures are more closely associated with our investing activities than the performance of our operating portfolio.

Same Property NOI from real estate operations and Same Property cash NOI from real estate operations
Defined as NOI, or Cash NOI, from real estate operations of Same Property groupings.  We believe that these are important supplemental measures of Same Property operating performance for the same reasons discussed above for NOI from real estate operations and Cash NOI from real estate operations.
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3Q 2024 Supplemental Information Package
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COPT Defense Properties
Definitions
Other Definitions
Acquisition Costs — Transaction costs expensed in connection with executed or anticipated acquisitions of operating properties.
Annualized Rental Revenue (“ARR”) — The monthly contractual base rent as of the reporting date (ignoring free rent then in effect and rent associated with tenant funded landlord assets) multiplied by 12, plus the estimated annualized expense reimbursements under existing leases for occupied space. With regard to properties owned through unconsolidated real estate JVs, we include the portion of ARR allocable to COPT Defense’s ownership interest. We consider ARR to be a useful measure for analyzing revenue sources because, since it is point-in-time based, it does not contain increases and decreases in revenue associated with periods in which lease terms were not in effect; historical revenue under GAAP does contain such fluctuations. We find the measure particularly useful for leasing, tenant, segment and industry analysis.
Average Escalations — Leasing statistic used to report average increase in rental rates over lease terms for leases with a term of greater than one-year.
Cash Rent — Includes monthly contractual base rent (ignoring rent abatements and rent associated with tenant funded landlord assets) multiplied by 12, plus estimated annualized expense reimbursements (average for first 12 months of term for new or renewed leases or as of lease expiration for expiring leases). We believe that cash rent is a useful measure for evaluating the rental rates at the time rent payments commence for our leasing activity, including changes in such rates relative to rates that may have been previously in place.
Committed Cost per Square Foot — Includes tenant improvement allowance (excluding tenant funded landlord assets), leasing commissions and estimated turn key costs and excludes lease incentives. We believe this is a useful measure for evaluating our costs associated with obtaining new leases.
Compound Annual Growth Rate — For renewed space, represents the compound annual growth rate between the first year cash rent of the expired lease and the first year cash rent of the renewal lease.
Debt to Net Income Ratio — Represents debt reported on our consolidated balance sheet divided by net income for the three month period that is annualized by multiplying by four. We do not present this ratio for periods with a net loss.
Defense/IT Portfolio — Represents properties in locations proximate to, or sometimes containing, key U.S. Government (“USG”) defense installations and missions.
Development Properties — Properties under, or contractually committed for, development.
Equity Market Capitalization — Defined as the sum of: (1) the product of the closing price of our common shares on the NYSE and the sum of (a) common shares outstanding and (b) common units outstanding; and (2) the liquidation value of preferred shares and preferred units in our operating partnership.
First Generation Space — Newly-developed or redeveloped space that has never been occupied.
Investment Space Leased — Includes vacant space leased within two years of the shell completion date for development properties or acquisition date for operating property acquisitions.
Net Income to Interest Expense Ratio — Represents net income reported on our consolidated statements of operations divided by interest expense. We do not present this ratio for periods with a net loss.
Net Income Payout Ratio — Defined as (1) the sum of dividends on common and deferred shares and distributions to holders of interests in the Operating Partnership divided by (2) net income. We do not present this ratio for periods with a net loss.
Operational Space — The portion of a property in operations (excludes portion under development or redevelopment).
Redevelopment Properties — Properties previously in operations on which activities to substantially renovate such properties were underway or approved.
Same Property — Operating properties stably owned and 100% operational since at least 1/1/23.
Second Generation Space — Space leased that has been previously occupied.
Straight-line Rent — Includes annual minimum base rents, net of abatements and lease incentives and excluding rent associated with tenant funded landlord assets, on a straight-line basis over the term of the lease, and estimated annual expense reimbursements (as of lease commencement for new or renewed leases or as of lease expiration for expiring leases). We believe that straight-line rent is a useful measures for evaluating the rental rates over the related lease terms for our leasing activity, including changes in such rates relative to rates that may have been previously in place.
Total Market Capitalization — Defined as the sum of: (1) consolidated outstanding debt, excluding discounts, premiums and deferred financing costs; (2) the product of the closing price of our common shares on the NYSE and the sum of (a) common shares outstanding and (b) common units outstanding; and (3) the liquidation value of preferred shares and preferred units in our operating partnership.
Total Portfolio — Operating properties, including ones owned through unconsolidated real estate JVs.
Vacancy Leasing Activity Ratio — Square footage associated with prospective tenants for vacant square feet in service divided by total vacant square feet in service.
Vacant Space Leased — Includes leasing of vacated second-generation space and vacant space leased in development properties and operating property acquisitions after two years from such properties’ shell completion or acquisition date.
42
3Q 2024 Supplemental Information Package
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NEWS RELEASE
IR Contacts:
Venkat Kommineni, CFAMichelle Layne
443.285.5587443.285.5452
venkat.kommineni@copt.commichelle.layne@copt.com


COPT Defense Reports Strong Third Quarter 2024 Results
_______________________________________________________________

EPS of $0.32
FFO per Share, as Adjusted for Comparability, of $0.65
1-cent above the Midpoint of Guidance

Increased Midpoint of 2024 FFO per Share Guidance by 1-cent to $2.57
Implies 6.2% FFO per Share Growth for the Year

Defense/IT Portfolio 95.0% Occupied and 96.5% Leased

Same Property Cash NOI Increased 9.4% in 3Q24 and 8.8% Year-to-Date
Raised Midpoint of Same Property Cash NOI Guidance for the Year by 50 Basis Points to 8.5%
_______________________________________________________________

Strong Leasing Volume and Retention YTD
Total Leasing of 829,000 SF in 3Q24 and 2.5 million SF Year-to-Date

123,000 SF in 3Q24 and 387,000 SF Year-to-Date of Vacancy Leasing
Exceeded Annual Target of 400,000 SF, with 4Q24 Progress To-Date

Tenant Retention of 88% in 3Q24 and 84% Year-to-Date
Raised Midpoint of Guidance for the Year by 250 Basis Points to 85%

80,000 SF in 3Q24 and 90,000 SF Year-to-Date of Investment Leasing
_______________________________________________________________

Active on External Growth
Acquired 365-acres in Des Moines, Iowa and 80,000 SF building in San Antonio, Texas
_______________________________________________________________


COLUMBIA, MD (BUSINESS WIRE) October 28, 2024 - COPT Defense Properties (“COPT Defense” or the “Company”) (NYSE: CDP) announced results for the third quarter ended September 30, 2024.



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Management Comments

Stephen E. Budorick, COPT Defense’s President & Chief Executive Officer, commented, “Our Defense/IT investment strategy, which concentrates our portfolio near priority U.S. defense installations, continued to generate strong results during the third quarter. FFO per share exceeded the midpoint of our guidance range and based on this outperformance, and our forecast for the remainder of the year, we increased the midpoint of 2024 FFO per share guidance by $0.01 to $2.57, which implies over 6% year-over-year growth. This marks our third increase for the year and a total of $0.06 of outperformance compared to the midpoint of our initial guidance. Looking forward, we continue to anticipate compound annual FFO per share growth of at least 4% between 2023 and 2026.

We are exceeding our plan in several areas and raised 2024 guidance on a group of key metrics. We increased the midpoint of 2024 guidance for same property cash NOI growth by 50 basis points to 8.5%, and increased tenant retention by 250 basis points to 85%. Based on our updated guidance, same property cash NOI growth would be the highest level in over a decade, and tenant retention would be the highest level in over two decades.

We are especially excited to announce the acquisition of a 365-acre land parcel near Des Moines, Iowa, which is a significant opportunity for us to expand our data center shell program to a new market. Des Moines, the 5th largest hyperscale market in the country, is home to several of the largest hyperscalers, which are drawn to the market given attractive land values, power availability with abundant access to renewable energy and long-haul fiber lines, and tax incentives enacted by supportive state and local governments. We expect this investment to fuel our development pipeline in the medium to long-term, and result in long-term accretion to FFO, AFFO, and NAV per share. As we build out the parcel in phases, we plan to self-fund development of the site on a leverage-neutral basis.

Additionally, we acquired a vacant office property in San Antonio, then subsequently leased the full building to the U.S. Government. With this transaction, our U.S. Government portfolio, which now includes 35 fully leased buildings and on a pro forma basis as of September 30, 2024, accounts for 36.5% of our annualized rental revenue. This acquisition provides additional operational scale given our nearby campus in San Antonio, will be accretive when rent commences in 2Q25, and reinforces our reputation as a trusted partner in supporting mission critical U.S. Government and defense contractor tenant requirements.”

Financial Highlights

3rd Quarter Financial Results:
>Diluted earnings per share (“EPS”) was $0.32 for the quarter ended September 30, 2024, compared to $(1.94) for the quarter ended September 30, 2023.

>Diluted funds from operations per share (“FFOPS”), as calculated in accordance with Nareit’s definition and as adjusted for comparability, was $0.65 for the quarter ended September 30, 2024, compared to $0.60 for the quarter ended September 30, 2023.

Operating Performance Highlights

Operating Portfolio Summary:
>At September 30, 2024, the Company’s 24.3 million square foot Total Portfolio was 93.1% occupied and 94.8% leased, which includes the 22.2 million square foot Defense/IT Portfolio that was 95.0% occupied and 96.5% leased.



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Same Property Performance:
>At September 30, 2024, the Company’s 22.2 million square foot same property portfolio was 93.6% occupied and 95.1% leased.

>The Company’s same property cash NOI increased 9.4% for the three months ended September 30, 2024 compared to the same period in 2023.

Leasing:
>Total Square Feet Leased: For the quarter ended September 30, 2024, the Company leased 829,000 square feet, including 626,000 square feet of renewals, 123,000 square feet of vacancy leasing, and 80,000 square feet of investment leasing. For the nine months ended September 30, 2024, the Company executed 2.5 million square feet of total leasing, including 2.1 million square feet of renewals, 387,000 square feet of vacancy leasing, and 90,000 square feet of investment leasing.

>Tenant Retention Rates: During the quarter ended September 30, 2024, the Company renewed 87.6% of expiring square feet in its Total Portfolio and 89.6% in its Defense/IT Portfolio. During the nine months ended September 30, 2024, the Company renewed 84.3% of expiring square feet in its Total Portfolio and 86.9% in its Defense/IT Portfolio.

>Rent Spreads & Average Escalations on Renewing Leases: For the quarter and nine months ended September 30, 2024, straight-line rents on renewals increased 17.2% and 9.3%, respectively, and cash rents on renewed space increased 4.1% and 0.8%, respectively, while annual escalations on renewing leases averaged 2.6% and 2.4%, respectively.

>Lease Terms: In the quarter ended September 30, 2024, lease terms averaged 4.1 years on renewing leases, 7.1 years on vacancy leasing, and 9.5 years on investment leasing. For the nine months ended September 30, 2024, lease terms averaged 4.0 years on renewing leases, 7.8 years on vacancy leasing, and 9.0 years on investment leasing.

Investment Activity Highlights
>Development Pipeline: The Company’s development pipeline consists of five properties totaling 831,000 square feet that were 79% leased as of September 30, 2024. These projects represent a total estimated investment of $335.4 million, of which $108.1 million has been spent.

>Acquisitions:
During the quarter, the Company acquired:
>A 365-acre land parcel near Des Moines, Iowa for $32 million that we plan to develop into approximately 3.3 million square feet of data center shell space.
>An 80,000 square foot Class A office building at 3900 Rogers Road in San Antonio, Texas for $17 million. The building was vacant upon acquisition, and the Company subsequently executed two leases with the U.S. Government to occupy the entire building.
>Please see the Company’s acquisition press release dated October 28, 2024 and pages 8-22 of the Company’s 3Q24 Results Presentation (refer to the ‘Associated Supplemental Presentation’ section below).

Balance Sheet and Capital Transaction Highlights
>For the quarter ended September 30, 2024, the Company’s adjusted EBITDA fixed charge coverage ratio was 4.8x.



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>At September 30, 2024, the Company’s net debt to in-place adjusted EBITDA ratio was 6.1x and its net debt adjusted for fully-leased investment properties to in-place adjusted EBITDA ratio was 5.9x.

>At September 30, 2024, and including the effect of interest rate swaps, the Company’s weighted average effective interest rate on its consolidated debt portfolio was 3.3% with a weighted average maturity of 5 years, and 100% of the Company’s debt was subject to fixed interest rates.

Associated Supplemental Presentation
Prior to the call, the Company will post a slide presentation to accompany management’s prepared remarks for its third quarter 2024 conference call; the presentation can be viewed and downloaded from the ‘Financial Info – Financial Results’ section of COPT Defense’s Investors website: https://investors.copt.com/financial-information/financial-results

2024 Guidance
Management is revising its full-year guidance for diluted EPS and diluted FFOPS, per Nareit and as adjusted for comparability, from the prior range of $1.22-$1.26, and $2.54-$2.58, respectively, to new ranges of $1.24-$1.26, and $2.56-$2.58, respectively. Management is establishing fourth quarter guidance for diluted EPS and diluted FFOPS per Nareit and as adjusted for comparability at $0.31-$0.33 and $0.64-$0.66, respectively. Reconciliations of projected diluted EPS to projected diluted FFOPS, in accordance with Nareit and as adjusted for comparability are as follows:

Reconciliation of Diluted EPS to FFOPS, per Nareit,
and As Adjusted for Comparability
Quarter Ending December 31, 2024
Year Ending December 31, 2024
LowHighLowHigh
Diluted EPS$0.31 $0.33 $1.24 $1.26 
Real estate-related depreciation and amortization0.33 0.33 1.32 1.32 
Diluted FFOPS, Nareit definition and as adjusted for comparability$0.64 $0.66 $2.56 $2.58 

Conference Call Information
Management will discuss third quarter 2024 results on its conference call tomorrow at 12:00 p.m. Eastern Time, details of which are listed below:

Conference Call Date: Tuesday, October 29, 2024
Time: 12:00 p.m. Eastern Time

Participants must register for the conference call at the link below to receive the dial-in number and personal pin. Registering only takes a few moments and provides direct access to the conference call without waiting for an operator. You may register at any time, including up to and after the call start time:
https://register.vevent.com/register/BI9796486f46f6424aa012b44d48ca9ae6

The conference call will also be available via live webcast in the ‘News & Events – IR Calendar’ section of COPT Defense’s Investors website: https://investors.copt.com/news-events/ir-calendar

Replay Information
A replay of the conference call will be immediately available via webcast only on COPT Defense’s Investors website and will be maintained on the website for approximately 90 days after the conference call.



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Definitions
For definitions of certain terms used in this press release, please refer to the information furnished in the Company’s Supplemental Information Package furnished on a Form 8-K which can be found on its website (www.copt.com). Reconciliations of non-GAAP measures to the most directly comparable GAAP measures are included in the attached tables.

About COPT Defense
COPT Defense, an S&P MidCap 400 Company, is a self-managed REIT focused on owning, operating and developing properties in locations proximate to, or sometimes containing, key U.S. Government (“USG”) defense installations and missions (referred to as its Defense/IT Portfolio). The Company’s tenants include the USG and their defense contractors, who are primarily engaged in priority national security activities, and who generally require mission-critical and high security property enhancements. As of September 30, 2024, the Company’s Defense/IT Portfolio of 194 properties, including 24 owned through unconsolidated joint ventures, encompassed 22.2 million square feet and was 96.5% leased.

Forward-Looking Information
This press release may contain “forward-looking” statements, as defined in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, that are based on the Company’s current expectations, estimates and projections about future events and financial trends affecting the Company. Forward-looking statements can be identified by the use of words such as “may,” “will,” “should,” “could,” “believe,” “anticipate,” “expect,” “estimate,” “plan” or other comparable terminology. Forward-looking statements are inherently subject to risks and uncertainties, many of which the Company cannot predict with accuracy and some of which the Company might not even anticipate. Although the Company believes that the expectations, estimates and projections reflected in such forward-looking statements are based on reasonable assumptions at the time made, the Company can give no assurance that these expectations, estimates and projections will be achieved. Future events and actual results may differ materially from those discussed in the forward-looking statements and the Company undertakes no obligation to update or supplement any forward-looking statements.

The areas of risk that may affect these expectations, estimates and projections include, but are not limited to, those risks described in Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.


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COPT Defense Properties
Summary Financial Data
(unaudited)
(dollars and shares in thousands, except per share data)
 For the Three Months Ended September 30,For the Nine Months Ended September 30,
 2024202320242023
Revenues  
Lease revenue$170,549 $155,268 $501,601 $459,510 
Other property revenue2,014 1,339 4,710 3,731 
Construction contract and other service revenues16,662 11,949 63,523 42,012 
Total revenues189,225 168,556 569,834 505,253 
Operating expenses  
Property operating expenses68,881 61,788 199,037 182,808 
Depreciation and amortization associated with real estate operations38,307 37,620 114,819 112,215 
Construction contract and other service expenses16,127 11,493 61,746 40,249 
Impairment losses— 252,797 — 252,797 
General and administrative expenses8,157 7,582 25,126 22,865 
Leasing expenses2,341 2,280 6,990 6,624 
Business development expenses and land carry costs918 714 3,079 1,935 
Total operating expenses134,731 374,274 410,797 619,493 
Interest expense(20,376)(17,798)(61,760)(50,759)
Interest and other income, net3,324 2,529 10,330 6,928 
Gain on sales of real estate— — — 49,392 
Income (loss) before equity in income (loss) of unconsolidated entities and income taxes37,442 (220,987)107,607 (108,679)
Equity in income (loss) of unconsolidated entities85 (68)180 (21)
Income tax expense(130)(152)(312)(467)
Net income (loss)37,397 (221,207)107,475 (109,167)
Net (income) loss attributable to noncontrolling interests:  
Common units in the Operating Partnership (“OP”)(711)3,691 (2,013)1,882 
Other consolidated entities(601)1,329 (1,654)164 
Net income (loss) attributable to common shareholders$36,085 $(216,187)$103,808 $(107,121)
Earnings per share (“EPS”) computation:  
Numerator for diluted EPS:  
Net income (loss) attributable to common shareholders$36,085 $(216,187)$103,808 $(107,121)
Amount allocable to share-based compensation awards(104)(992)(319)(1,093)
Numerator for diluted EPS$35,981 $(217,179)$103,489 $(108,214)
Denominator:  
Weighted average common shares - basic112,314 112,196 112,279 112,170 
Dilutive effect of share-based compensation awards696 — 566 — 
Weighted average common shares - diluted113,010 112,196 112,845 112,170 
Diluted EPS$0.32 $(1.94)$0.92 $(0.96)
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COPT Defense Properties
Summary Financial Data
(unaudited)
(in thousands, except per share data)
 For the Three Months Ended September 30,For the Nine Months Ended September 30,
 2024202320242023
Net income (loss)$37,397 $(221,207)$107,475 $(109,167)
Real estate-related depreciation and amortization38,307 37,620 114,819 112,215 
Impairment losses on real estate— 252,797 — 252,797 
Gain on sales of real estate — — — (49,392)
Depreciation and amortization on unconsolidated real estate JVs756 806 2,311 2,412 
Funds from operations (“FFO”)76,460 70,016 224,605 208,865 
FFO allocable to other noncontrolling interests(985)(1,059)(2,805)(3,006)
Basic FFO allocable to share-based compensation awards(617)(481)(1,803)(1,427)
Basic FFO available to common share and common unit holders (“Basic FFO”)74,858 68,476 219,997 204,432 
Redeemable noncontrolling interests— — 1,446 (58)
Diluted FFO adjustments allocable to share-based compensation awards47 36 141 112 
Diluted FFO available to common share and common unit holders (“Diluted FFO”)74,905 68,512 221,584 204,486 
Executive transition costs69 82 227 330 
Diluted FFO comparability adjustments allocable to share-based compensation awards— (1)(1)(3)
Diluted FFO available to common share and common unit holders, as adjusted for comparability74,974 68,593 221,810 204,813 
Straight line rent adjustments and lease incentive amortization613 12,882 7,874 6,205 
Amortization of intangibles and other assets included in net operating income (“NOI”)211 26 544 24 
Share-based compensation, net of amounts capitalized2,617 2,280 7,826 6,226 
Amortization of deferred financing costs671 639 2,037 1,899 
Amortization of net debt discounts, net of amounts capitalized1,032 750 3,069 1,990 
Replacement capital expenditures(27,824)(21,122)(69,850)(71,996)
Other298 74 493 (420)
Diluted adjusted funds from operations available to common share and common unit holders (“Diluted AFFO”)$52,592 $64,122 $173,803 $148,741 
Diluted FFO per share$0.65 $0.60 $1.92 $1.79 
Diluted FFO per share, as adjusted for comparability$0.65 $0.60 $1.92 $1.79 
Dividends/distributions per common share/unit$0.295 $0.285 $0.885 $0.855 

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COPT Defense Properties
Summary Financial Data
(unaudited)
(Dollars and shares in thousands, except per share data)
September 30,
2024
December 31,
2023
Balance Sheet Data  
Properties, net of accumulated depreciation$3,604,688 $3,503,678 
Total assets$4,234,302 $4,246,966 
Debt per balance sheet$2,390,839 $2,416,287 
Total liabilities$2,679,271 $2,699,631 
Redeemable noncontrolling interests$22,436 $23,580 
Total equity$1,532,595 $1,523,755 
Debt to assets56.5 %56.9 %
Net debt to adjusted book40.8 %40.6 %
Defense/IT Portfolio Data (as of period end)  
Number of operating properties194 190 
Total operational square feet (in thousands)22,174 21,719 
% Occupied95.0 %96.2 %
% Leased96.5 %97.2 %
For the Three Months Ended September 30,For the Nine Months Ended September 30,
2024202320242023
GAAP    
Payout ratio:
Net income90.7 %N/A94.6 %N/A
Debt ratios:
Net income to interest expense ratio1.8 N/A1.7 N/A
Debt to net income ratio16.0 N/AN/AN/A
Non-GAAP
Payout ratios:
Diluted FFO44.9 %47.3 %45.6 %47.6 %
Diluted FFO, as adjusted for comparability44.9 %47.3 %45.5 %47.5 %
Diluted AFFO64.0 %50.6 %58.1 %65.4 %
Debt ratios:
Adjusted EBITDA fixed charge coverage ratio4.8 4.6 4.7 4.9 
Net debt to in-place adjusted EBITDA ratio6.1 6.2 N/AN/A
Net debt adj. for fully-leased investment properties to in-place adj. EBITDA ratio5.9 5.9 N/AN/A
Reconciliation of denominators for per share measures 
Denominator for diluted EPS113,010 112,196 112,845 112,170 
Weighted average common units1,696 1,520 1,675 1,508 
Dilutive effect of additional share-based compensation awards— 429 — 422 
Redeemable noncontrolling interests— — 873 51 
Denominator for diluted FFO per share and as adjusted for comparability114,706 114,145 115,393 114,151 




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COPT Defense Properties
Summary Financial Data
(unaudited)
(in thousands)
For the Three Months Ended September 30,For the Nine Months Ended September 30,
 2024202320242023
Numerators for Payout Ratios
Dividends on unrestricted common and deferred shares$33,165 $31,996 $99,461 $95,980 
Distributions on unrestricted common units491 432 1,496 1,295 
Dividends and distributions on restricted shares and units247 200 752 619 
Total dividends and distributions for GAAP payout ratio33,903 32,628 101,709 97,894 
Dividends and distributions on antidilutive shares and units(249)(202)(756)(623)
Dividends and distributions for non-GAAP payout ratios$33,654 $32,426 $100,953 $97,271 
Reconciliation of net income (loss) to earnings before interest, income taxes, depreciation and amortization for real estate (“EBITDAre”), adjusted EBITDA and in-place adjusted EBITDA    
Net income (loss)$37,397 $(221,207)$107,475 $(109,167)
Interest expense20,376 17,798 61,760 50,759 
Income tax expense130 152 312 467 
Real estate-related depreciation and amortization38,307 37,620 114,819 112,215 
Other depreciation and amortization614 615 1,786 1,826 
Impairment losses on real estate— 252,797 — 252,797 
Gain on sales of real estate — — — (49,392)
Adjustments from unconsolidated real estate JVs1,759 1,743 5,139 5,006 
EBITDAre98,583 89,518 291,291 264,511 
Credit loss expense38 372 496 677 
Business development expenses557 313 1,790 948 
Executive transition costs69 82 580 636 
Net gain on other investments(11)(25)(488)(25)
Adjusted EBITDA99,236 90,260 $293,669 $266,747 
Pro forma NOI adjustment for property changes within period— 1,647 
In-place adjusted EBITDA$99,236 $91,907 
Reconciliations of tenant improvements and incentives, building improvements and leasing costs for operating properties to replacement capital expenditures
Tenant improvements and incentives$18,772 $14,457 $46,593 $67,062 
Building improvements6,694 6,307 17,352 11,214 
Leasing costs3,013 1,902 9,713 7,194 
Net additions to (exclusions from) tenant improvements and incentives728 (813)(11,981)
Excluded building improvements and leasing costs(1,383)(731)(3,812)(1,493)
Replacement capital expenditures$27,824 $21,122 $69,850 $71,996 
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COPT Defense Properties
Summary Financial Data
(unaudited)
(in thousands)
For the Three Months Ended September 30,For the Nine Months Ended September 30,
 2024202320242023
Reconciliation of interest expense to the denominator for fixed charge coverage-Adjusted EBITDA    
Interest expense$20,376 $17,798 $61,760 $50,759 
Less: Amortization of deferred financing costs(671)(639)(2,037)(1,899)
Less: Amortization of net debt discounts, net of amounts capitalized(1,032)(750)(3,069)(1,990)
COPT Defense’s share of interest expense of unconsolidated real estate JVs, excluding amortization of deferred financing costs and net debt premium and gain or loss on interest rate derivatives821 805 2,433 2,369 
Scheduled principal amortization448 753 1,879 2,289 
Capitalized interest712 1,487 1,944 3,451 
Denominator for fixed charge coverage-Adjusted EBITDA$20,654 $19,454 $62,910 $54,979 
Reconciliation of net income (loss) to NOI from real estate operations, same property NOI from real estate operations and same property cash NOI from real estate operations
Net income (loss)$37,397 $(221,207)$107,475 $(109,167)
Construction contract and other service revenues(16,662)(11,949)(63,523)(42,012)
Depreciation and other amortization associated with real estate operations38,307 37,620 114,819 112,215 
Construction contract and other service expenses16,127 11,493 61,746 40,249 
Impairment losses— 252,797 — 252,797 
General and administrative expenses8,157 7,582 25,126 22,865 
Leasing expenses2,341 2,280 6,990 6,624 
Business development expenses and land carry costs918 714 3,079 1,935 
Interest expense20,376 17,798 61,760 50,759 
Interest and other income, net(3,324)(2,529)(10,330)(6,928)
Gain on sales of real estate— — — (49,392)
Equity in (income) loss of unconsolidated entities(85)68 (180)21 
Unconsolidated real estate JVs NOI allocable to COPT Defense included in equity in income (loss) of unconsolidated entities1,844 1,675 5,319 4,988 
Income tax expense130 152 312 467 
NOI from real estate operations105,526 96,494 312,593 285,421 
Non-Same Property NOI from real estate operations(6,875)(1,455)(19,867)(3,436)
Same Property NOI from real estate operations98,651 95,039 292,726 281,985 
Straight line rent adjustments and lease incentive amortization1,531 10,154 9,399 3,888 
Amortization of acquired above- and below-market rents(69)(120)(207)(415)
Lease termination fees, net(931)(748)(2,587)(3,028)
Tenant funded landlord assets and lease incentives(1,942)(15,402)(12,630)(18,837)
Cash NOI adjustments in unconsolidated real estate JVs(136)(130)(364)(420)
Same Property Cash NOI from real estate operations$97,104 $88,793 $286,337 $263,173 

x



COPT Defense Properties
Summary Financial Data
(unaudited)
(in thousands)
September 30,
2024
December 31,
2023
Reconciliation of total assets to adjusted book  
Total assets$4,234,302 $4,246,966 
Accumulated depreciation1,502,730 1,400,162 
Accumulated amortization of intangibles on property acquisitions and deferred leasing costs227,281 228,484 
COPT Defense’s share of liabilities of unconsolidated real estate JVs61,118 60,583 
COPT Defense’s share of accumulated depreciation and amortization of unconsolidated real estate JVs12,014 9,528 
Less: Property - operating lease liabilities(33,615)(33,931)
Less: Property - finance lease liabilities(397)(415)
Less: Cash and cash equivalents(34,478)(167,820)
Less: COPT Defense’s share of cash of unconsolidated real estate JVs(1,575)(852)
Adjusted book$5,967,380 $5,742,705 

September 30,
2024
December 31,
2023
September 30,
2023
Reconciliation of debt to net debt and net debt adjusted for fully-leased investment properties
Debt per balance sheet$2,390,839 $2,416,287 $2,415,783 
Net discounts and deferred financing costs24,633 28,713 29,980 
COPT Defense’s share of unconsolidated JV gross debt53,148 52,613 52,511 
Gross debt2,468,620 2,497,613 2,498,274 
Less: Cash and cash equivalents(34,478)(167,820)(204,238)
Less: COPT Defense’s share of cash of unconsolidated real estate JVs(1,575)(852)(1,031)
Net debt2,432,567 2,328,941 2,293,005 
Costs incurred on fully-leased development properties(70,954)(53,914)(124,038)
Costs incurred on fully-leased operating property acquisitions(17,034)— — 
Net debt adjusted for fully-leased investment properties$2,344,579 $2,275,027 $2,168,967 
xi


suppbackcoverfinal-kp1.jpg

v3.24.3
Cover Page
Oct. 28, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Oct. 28, 2024
Entity Registrant Name COPT DEFENSE PROPERTIES
Entity Incorporation, State or Country Code MD
Entity File Number 1-14023
Entity Tax Identification Number 23-2947217
Entity Address, Address Line One 6711 Columbia Gateway Drive
Entity Address, Address Line Two Suite 300
Entity Address, City or Town Columbia
Entity Address, State or Province MD
Entity Address, Postal Zip Code 21046
City Area Code 443
Local Phone Number 285-5400
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Shares of beneficial interest, $0.01 par value
Trading Symbol CDP
Security Exchange Name NYSE
Entity Emerging Growth Company false
Entity Central Index Key 0000860546
Amendment Flag false

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