Article Excerpt:
TWST: Would you briefly describe First Potomac Realty Trust?Mr. Bass: First Potomac is a REIT that focuses on owning and operating industrial and light industrial properties, sometimes called flex properties, in the greater Washington, DC, region ' from Baltimore, Maryland, to Northern Virginia, with a heavy concentration in the Washington, DC, area. First Potomac was formed originally in 1997 as a spinoff of a long-standing Washington real estate company, Donatelli & Klein. We took the company public in October 2003. We saw that the public market would afford us the best way to grow our business and that has, in fact, come to fruition. In the last two and a half years, we have bought a little over $600 million in assets in about 25 separate transactions and we are now a $1 billion company. Since our IPO, we've done three follow-on offerings as well as some debt financings on the secured side. We have been able to take advantage of what has traditionally been a very fragmented ownership market for this type of property in this region. Our Founders, Doug Donatelli and Nick Smith, realized when they spun out from Donatelli & Klein that it was essentially an overlooked property sector within the greater DC region. The largest owner of industrial and flex properties in this market owned about 2% of the market. So we have been able to fairly quickly become a dominant owner of this type of property in this marketplace.
TWST: What are your priorities for the next 12 months?
Mr. Bass: We want to continue to execute on our business plan. We bought
about $240 million of property in 2004 and we bought $215 million of
property in 2005. Our guidance for 2006 is to acquire another $175 to
$275 million worth of assets. So far in 2006, we have bought about $55
million worth of property, and we expect to continue to grow the
business through acquisitions. As we have been acquiring properties, we
have also been acquiring some outparcels that will allow us to begin
doing some development on a fairly small-scale basis, generally built-
to-suit, but there will also be a little bit of property development. If
you think about this property type, it's often going to be a multi-
tenanted asset, so you're not going to be able to have the entire
property leased before you commence construction. So we will begin some
minimal development and continue doing acquisitions. We've grown the
company significantly to accommodate all of this growth. When we went
public, we had about 20 employees and we now have a little over 90
employees, many of whom are on the property management and property
accounting and leasing side. So we have been able to grow our
infrastructure ahead of our curve so that we can make sure that we can
accommodate all of this potential future growth.
Tickers included in this excerpt: FPO
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