Carr Properties ( CP ) is a leading owner, operator and developer of office properties in the Greater Washington DC metro area

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1 Carr Properties

2 1 Company Overview Carr Properties ( CP ) is a leading owner, operator and developer of office properties in the Greater Washington DC metro area Prior to this transaction with Alony-Hetz, we have been actively developing and acquiring value-add office properties with significant capital from our parent, the Special Situation Property Fund ( SSPF ), a fund managed by JP Morgan Asset Management Carr Properties is a self-managed, fully integrated platform with acquisitions, asset management, property management and development After this transaction with Alony-Hetz, CP will own 20 office properties in the Washington DC metro area worth $1.1 billion (CP interest of ~$720 million) CP will also own 4 development assets with 654,000 square feet of gross leasable area 1700 New York Avenue is 79% pre-leased and will be delivered by the end of 2013 Estimated total cost of the three other projects is $260 million (CP interest of $215 million) SSPF and Alony Hetz will have equal ownership and control An entity controlled by the Carr and Clark families ( Carr / Clark ) will own approximately 10% We believe a compelling opportunity exists to acquire high-quality, stable office properties that offer attractive risk-adjusted returns CP will be well-capitalized for the opportunity

3 2 Carr Properties History CP and its predecessor entities have a history of generating attractive returns for its investors and stakeholders: From 1998 to 2005, predecessor entities to CP acquired over $500 million of properties Investors received an average IRR of 26% on invested capital In 2005, the predecessor entity to CP took a private portfolio totaling $360 million in assets public as Columbia Equity Trust (NYSE: COE), raising $207 million of common equity In 2007, COE entered into a merger at a price of $19.50 per share with SSPF in a go private transaction, generating in excess of a 20% IRR for its IPO shareholders From the date of the merger closing in 2007, CP has: Acquired approximately $600 million of income producing property totaling 1.7 million square feet; Developed 901 K Street and 1701 Duke Street (trophy quality) with a combined capitalization of approximately $190 million; Started the development of four additional assets totaling approximately $400 million

4 3 Strategy and Vision Vision: Become the premier locally based owner/operator of office properties in the Washington DC metro area The business plan will be to scale CPC to approximately $1.5 of assets by 2016 through targeted acquisitions and investments in development projects: Take CPC public through an IPO (targeted from third year after closing) Continue to grow CPC privately Targeted Investments Operating Strategy Focus on class A/B+, high quality, stabilized, core/core+, urban office projects in the greater Washington DC metro area More than 85% leased with limited near-term lease rollover Priced at or below replacement cost Located within easy access of amenity and transportation base Typically multi-tenant layouts Preferred equity investments will also be considered on a case-by-case basis Pursue off-market acquisitions outside the normal auction process Operate like a public company Intensive asset and property management through vertically integrated platform Total interest in development and value-add assets targeted at 15% of total asset value Target overall leverage ratio shall not exceed 60% Intent is to bring leverage below 45% in conjunction with an IPO Return objective is to provide investors a minimum 6% overall leveraged yield on equity during the investment holding period

5 Square Footage (in thousands) 4 Portfolio Metrics Summary Portfolio by Risk Profile (CP Share) Occupancy: 86.3% Total Gross Leasable Area: 3.5 million SF Core / Core-Plus Value Add Development Gross Leasable Area (CP Share): 3.0 million SF $750 M 91% $37 M 5% $36 M 4% Planned Development GLA: 500,000 SF Total Portfolio Value (CP Share): $823 million Lease Expiration Schedule Portfolio by Geography (CP Share) 1,400 1,200 40% DC MD VA 1, $281 M 34% $194 M 24% $348 M 42% % 15% 9% 6% 4% 12% 672 KSF 22% 730 KSF 24% 1,597 KSF 53%

6 5 Projected Portfolio NOI Growth (CP Share) Virginia $24 M 55% 2013 NOI $44 M Washington DC $10 M 23% Virginia $36 M 34% 2016 NOI $107 M Washington DC $43 M 41% Maryland $10 M 22% Maryland $27 M 25% 2016 NOI Build-Up $44 M $33 M $14 M $16 M $107 M 2013 NOI Acquisitions Development Lease-Up Note: Assumes future acquisitions will be distributed as follows: 60% in DC, 20% in VA, and 20% in MD

7 6 Properties Washington, DC Core / Core-Plus th Street (100%) Vermont Ave. (100%) K Street (82%) rd Street (10%) Eye Street (10%) 6. Georgetown Plaza (40%) Development Assets New York Avenue (100%)

8 7 Properties Maryland & Virginia Arlington Chevy Chase 24 Silver Spring Dulles Toll Road 10 CBD Fairfax Alexandria Core / Core-Plus Development Assets Value-Add Assets Duke Street Alexandria, VA (100%) 9. Arlington Plaza Arlington, VA (100%) 14. Atrium Alexandria, VA (37%) 15. Centerpointe I & II Fairfax, VA (50%) East West Highway Bethesda, MD (100%) Wilson Boulevard Arlington, VA (50%) 10. Barlow Building Chevy Chase, MD (100%) 16. King Street Alexandria, VA (50%) Wilson Boulevard Arlington, VA (84%) 11. Gatewood Plaza Fairfax, VA (100%) 12. Loudoun Gateway Dulles, VA (100%) 13. Victory Point Chantilly, VA (100%) 17. Independence Center I Chantilly, VA (100%) 18. Independence Center II Chantilly, VA (100%) 19. Park Plaza II Land Rockville, MD (100%) 23. Park Plaza I Rockville, MD (100%) 24. Woodmont Place Rockville, MD (100%)

9 8 Select Properties 901 K Street Barlow Building 219,421 SF trophy asset located in the heart of the new downtown, Mount Vernon Square area of the East End Land for development acquired in offmarket transaction 91% leased to a roster of quality tenants, including Microsoft, Baker Donelson and US Steel Developed by Carr Properties in ,326 SF class A asset located two blocks from the Friendship Heights Metro station in Chevy Chase, MD Best medical office building in the DC metro area 97% leased predominantly to medical tenants Built in 1966; renovated

10 9 Select Development Properties 1700 New York Avenue 4500 East West Highway 122,000 SF trophy asset Under construction; delivery scheduled for 4Q 2013 Located two blocks from the White House and adjacent to the Corcoran Gallery of Art 79% preleased LEED Gold certified with spectacular views of the National Mall 220,400 SF trophy asset Under construction; delivery scheduled for 2Q 2014 Located just 700 feet from the entrance to the Bethesda Metro station in Bethesda, MD First office building built in the strong Bethesda market in the past 12 years Targeting LEED Platinum Certification

11 10 Long-Term Balance Sheet Strategy CP plans to pursue a balance sheet strategy similar to that of a public REIT, albeit with slightly higher overall leverage until IPO Overall leverage for CP shall not exceed 60% Loan-to-value for secured debt on individual properties is targeted to be no more than 65% CP will aim to maximize the unsecured portion of its debt and utilize as much corporate debt as possible for maximum flexibility CP intends to fix the interest rate on both entity-level and property-level debt on a long-term basis through fixed-rate borrowings or through interest rate hedging techniques Opportunity to lock in historically low rates In conjunction with any potential IPO, CP will de-lever to a loan-to-value range consistent with high-quality public REITs CP s high barrier office REIT peers have an average leverage ratio of 39% (including preferred) CP will work toward achieving an investment grade rating

12 11 Pro Forma Debt Overview $70 Pro Forma Debt Maturity Schedule ($MM) $60 38% $50 30% $40 $30 $20 14% 9% $10 $0 4% 5% 0% ($ in thousands) New Unsecured Credit Facility Mortgage Debt Total Debt Total Leverage $41,725 $153,188 $194,913 23% % Secured Debt % Fixed Rate Debt 79% 67% Weighted Average Interest Rate 4.6%

13 12 Ownership Structure Management Team 49.9% 0.2% 49.9% Carr Properties Corp. [REIT] 90% 10% Carr Properties Partnership 18 Core / Core-Plus 2 Value-Add Assets Fully Integrated Operating, Property Management and Development Company 4 Development Projects

14 13 Investment Partners JP Morgan Chase is the largest bank in the United States by assets (~$2.3 trillion) JP Morgan Asset Management has $35.7 billion in global real estate and infrastructure assets under management and 39 years of investment experience The Special Situation Property Fund invests in value-add real estate opportunities in a variety of sectors across the United States on behalf of public and private pension funds In 2005, acquired Columbia Equity Trust, the predecessor entity to Carr Properties Oliver T. Carr, Jr. and The Oliver Carr Company In 1962, Oliver T. Carr, Jr. founded the Oliver Carr Company as a full service commercial office development company based in Washington D.C. The company developed over 15 million square feet of trophy quality buildings through its history In 1993, the Oliver Carr Company portfolio was taken public through an IPO and CarrAmerica was formed Oliver T. Carr, Jr. led CarrAmerica as its Chairman of the Board until 2003 Clark and its predecessor entities have been performing construction work in Washington D.C. since 1906 A. James Clark has been with the company for over 60 years, building it from a small local contractor into one of the largest private companies in the United States Over $4 billion in revenue and approximately 3,800 employees James Clark served on the board of CarrAmerica and owned more than 5% of the company

15 14 Investment Highlights Strong platform with an exciting growth opportunity Proven Partners & Management Carr family has been a player in Washington DC office real estate for over 50 years JP Morgan Asset Management has over 40 years of investment experience and over $35 billion in global real estate assets Clark Construction has been in DC for almost 100 years and is one of the largest private companies in the United States Vertically Integrated Platform CP s platform includes acquisitions, asset management, property management and development Ability to differentiate assets and drive value High Quality Portfolio & Development Pipeline Numerous stabilized Class A properties Four trophy-quality developments scheduled to be delivered between 2013 and 2017 Pristine Balance Sheet, Loaded for Growth At closing, CP will have extremely low leverage (~27%) and large capacity for acquisitions Focused Strategy in a Market with Attractive Fundamentals CP is a local sharpshooter focused solely on DC with longstanding relationships with local market owners, developers, tenants, property managers and brokers The Washington DC market is a resilient, high-barrier office market with better risk-adjusted returns over the last 20 years than any other market in the United State

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