8-K

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):  May 1, 2018

Franklin Street Properties Corp.

(Exact name of registrant as specified in its charter)

Maryland	001-32470	04-3578653
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

401 Edgewater Place, Suite 200, Wakefield, Massachusetts	01880
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code:  (781) 557-1300

(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))

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 May 1, 2018, Franklin Street Properties Corp. (the “Registrant”) announced its financial results for the three months ended March 31, 2018.  The full text of the press release issued in connection with the announcement is furnished as Exhibit 99.1 to this Current Report on Form 8-K.  The press release references certain supplemental operating and financial data that is now available on the Registrant’s website.  A copy of the supplemental operating and financial data is attached hereto as Exhibit 99.2 and is incorporated by reference herein. 

The information in this Form 8-K (including Exhibits 99.1 and 99.2) shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing.

Item 9.01.  Financial Statements and Exhibits.

(d) Exhibits

See Exhibit Index attached hereto.

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EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release issued by Franklin Street Properties Corp. on May 1, 2018.
99.2	Supplemental Operating and Financial Data for the First Quarter of 2018.

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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.

	FRANKLIN STREET PROPERTIES CORP.
Date:  May 1, 2018	By:	/s/ George J. Carter
		George J. Carter
		Chief Executive Officer

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EX-99.1

Exhibit 99.1

PRESS RELEASE Franklin Street Properties Corp.

401 Edgewater Place  Suite 200  Wakefield, Massachusetts  01880  (781) 557-1300 www.fspreit.com

Contact: Georgia Touma   (877) 686-9496 For Immediate Release

Franklin Street Properties Corp. Announces

First Quarter 2018 Results

Wakefield, MA—May 1, 2018—Franklin Street Properties Corp. (the “Company”, “FSP”, “we” or “our”) (NYSE American:  FSP), a real estate investment trust (REIT), announced its results for the first quarter ended March 31, 2018.         

George J. Carter, Chairman and Chief Executive Officer, commented as follows:

“For the first quarter of 2018, FSP’s Funds from Operations or FFO totaled approximately $26.4 million or $0.25 per share.  Adjusted Funds From Operations or AFFO for the same period totaled approximately $16.9 million or $0.16 per share.  Dividends declared for the first quarter of 2018 were $9.7 million or $0.09 per share.  Potential leasing activity is strong within our property portfolio, continuing the trends we saw in the third and fourth quarters of 2017.  We anticipate higher leased percentages in the portfolio as 2018 continues.  The energy influenced markets of Houston and Denver continue to improve with the upward trend of oil prices and are showing more potential leasing activity than the last several years.  A number of our larger tenants are approaching us with early lease renewal requests and we would expect to see many of these transactions completed this year and next.” 

Highlights

· FFO was $26.4 million or $0.25 per basic and diluted share for the first quarter ended March 31, 2018.  We had Net Income of $1.4 million or $0.01 per basic and diluted share for the first quarter ended March 31, 2018.        

· Adjusted Funds From Operations (AFFO) was $0.16 per basic and diluted share for the first quarter ended March 31, 2018.        

Leasing Update

· Our directly owned real estate portfolio of 34 properties totaling approximately 9.8 million square feet was approximately 88.5% leased as of March 31, 2018, which was a 1.2% decrease compared to December 31, 2017.            

· During the quarter ended March 31, 2018, we leased approximately 109,000 square feet, of which approximately 25,000 square feet was with new tenants.  

· Second quarter 2018 leasing activity to date includes approximately 500,000 square feet of potential leases out for execution, more than 100,000 square feet of which would be new leases and expansions.            

· Weighted average annualized GAAP rent per square foot was approximately $29.05 as of March 31, 2018, compared to $28.87 as of December 31, 2017, $27.92 as of December 31, 2016, $26.93 as of December 31, 2015, and $26.04 as of December 31, 2014.  We believe that the increase is attributable to the enhanced quality of our real estate portfolio and value creation derived from our recent acquisitions, dispositions and leasing.

· Our project at 801 Marquette Avenue provides a contemporary, forward-looking experience in a vintage warehouse style office with modern systems and market leading amenities in the heart of the Minneapolis CBD. The redevelopment of 801 Marquette, which is approximately 127,268 square feet, was completed in 2017.  Subsequent to quarter end, we signed a lease with a tenant for approximately 18,000 square feet on the first floor with anticipated occupancy in December 2018 and we also signed a lease with an operator for a full service café located in our Atrium with anticipated operations commencing this summer.  Our project continues to see great activity and our team has led approximately 50 prospect tours representing in excess of 1.7 million square feet across

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all industries.  We expect 801 Marquette to be substantially leased by year end and stabilized in the third quarter of 2019. 

Acquisition and Disposition Update

· We do not anticipate making new acquisitions at this time but continue to monitor all prospective investment opportunities in our core markets.    

· We do not expect any significant disposition activity within our directly-owned portfolio as we begin the second quarter of 2018.

· We anticipate some potential disposition activity within our managed portfolio during 2018.      

Dividend Update

On April 6, 2018, the Company announced that its Board of Directors declared a regular quarterly cash dividend for the three months ended March 31, 2018 of $0.09 per share of common stock that will be paid on May 10, 2018 to stockholders of record on April 20, 2018.      

Non-GAAP Financial Information

A reconciliation of Net income (loss) to FFO, AFFO and Sequential Same Store NOI and our definitions of FFO, AFFO and Sequential Same Store NOI can be found on Supplementary Schedules H and I.    

Real Estate Update

Supplementary schedules provide property information for the Company’s owned real estate portfolio and for two non-consolidated REITs in which the Company holds preferred stock interests as of March 31, 2018.  The Company will also be filing an updated supplemental information package that will provide stockholders and the financial community with additional operating and financial data.  The Company will file this supplemental information package with the SEC and make it available on its website at www.fspreit.com.  

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FFO Guidance

We are reaffirming our full year FFO guidance for 2018, which is estimated to be in the range of approximately $0.96 to $1.00 per basic and diluted share, and for the second quarter of 2018, are initiating guidance, which is estimated to be in the range of approximately $0.22 to $0.24 per basic and diluted share.  We are reaffirming full year 2018 net income guidance in the range of $0.02 to $0.06 per basic and diluted share, and for the second quarter of 2018,  are initiating net income (loss) guidance in the range of $(0.02) to $0.00 per basic and diluted share.  This guidance (a) excludes the impact of future acquisitions, developments, dispositions, debt financings or repayments or other capital market transactions; (b) reflects estimates from our ongoing portfolio of properties, other real estate investments and general and administrative expenses; and (c) reflects our current expectations of economic conditions.  We will update guidance quarterly in our earnings releases.  There can be no assurance that the Company’s actual results will not differ materially from the estimates set forth above. 

A reconciliation of the guidance for net income (loss) per share to the guidance for FFO per share is provided as follows:  

		Q2 2018 Range				Full Year 2018 Range
	Low		High		Low		High
Net income (loss) per share	$	(0.02)	$	0.00	$	0.02	$	0.06
GAAP loss from non-consolidated REITs		0.00		0.00		0.00		0.00
FFO from non-consolidated REITs		0.01		0.01		0.04		0.04
Depreciation & Amortization		0.23		0.23		0.90		0.90
Funds From Operations per share	$	0.22	$	0.24	$	0.96	$	1.00

Today’s news release, along with other news about Franklin Street Properties Corp., is available on the Internet at www.fspreit.com.  We routinely post information that may be important to investors in the Investor Relations section of our website.  We encourage investors to consult that section of our website regularly for important information about us and, if they are interested in automatically receiving news and information as soon as it is posted, to sign up for E-mail Alerts. 

Earnings Call

A conference call is scheduled for May 2, 2018 at 10:00 a.m. (ET) to discuss the first quarter results. To access the call, please dial 1-800-464-8240. Internationally, the call may be accessed by dialing 1-412-902-6521. To access the call from Canada, please dial 1-866-605-3852. To listen via live audio webcast, please visit the Webcasts & Presentations section in the Investor Relations section of the Company's website (www.fspreit.com) at least ten minutes prior to the start of the call and follow the posted directions. The webcast will also be available via replay from the above location starting one hour after the call is finished.     

About Franklin Street Properties Corp.

Franklin Street Properties Corp., based in Wakefield, Massachusetts, is focused on investing in institutional-quality office properties in the U.S.  FSP’s strategy is to invest in select urban infill and central business district (CBD) properties, with primary emphasis on our five core markets of Atlanta, Dallas, Denver, Houston, and Minneapolis.  FSP seeks value-oriented investments with an eye towards long-term growth and appreciation, as well as current income.  FSP is a Maryland corporation that operates in a manner intended to qualify as a real estate investment trust (REIT) for federal income tax purposes.  To learn more about FSP please visit our website at www.fspreit.com.

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Forward-Looking Statements

Statements made in this press release that state FSP’s or management’s intentions, beliefs, expectations, or predictions for the future may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  This press release may also contain forward-looking statements, such as our ability to lease space in the future,  expectations for FFO and net income (loss) in future periods, expectations for growth,  leasing and acquisition and disposition activities in future periods, prospects for long-term sustainable growth and the timing of leasing at our 801 Marquette Avenue property, that are based on current judgments and current knowledge of management and are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those indicated in such forward-looking statements.  Accordingly, readers are cautioned not to place undue reliance on forward-looking statements.  Investors are cautioned that our forward-looking statements involve risks and uncertainty, including without limitation, economic conditions in the United States, disruptions in the debt markets, economic conditions in the markets in which we own properties, risks of a lessening of demand for the types of real estate owned by us, changes in government regulations and regulatory uncertainty, uncertainty about governmental fiscal policy, geopolitical events and expenditures that cannot be anticipated such as utility rate and usage increases, delays in construction schedules, unanticipated repairs, additional staffing, insurance increases and real estate tax valuation reassessments.  See the “Risk Factors” set forth in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2017, as the same may be updated from time to time in subsequent filings with the United States Securities and Exchange Commission.  Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, acquisitions, dispositions, performance or achievements.  We will not update any of the forward-looking statements after the date of this press release to conform them to actual results or to changes in our expectations that occur after such date, other than as required by law. 

Franklin Street Properties Corp.

Earnings Release

Supplementary Information

Table of Contents

Franklin Street Properties Corp. Financial Results	A-C
Real Estate Portfolio Summary Information	D
Portfolio and Other Supplementary Information	E
Percentage of Leased Space	F
Largest 20 Tenants – FSP Owned Portfolio	G
Reconciliation and Definitions of Funds From Operations (FFO) and Adjusted
Funds From Operations (AFFO)	H
Reconciliation and Definition of Sequential Same Store results to Property Net
Operating Income (NOI) and Net Income (Loss)	I

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Franklin Street Properties Corp. Financial Results

Supplementary Schedule A

Condensed Consolidated Income (Loss) Statements

(Unaudited)

	For the
	Three Months Ended
	March 31,
(in thousands, except per share amounts)	2018		2017
Revenue:
Rental	$	65,628	$	67,376
Related party revenue:
Management fees and interest income from loans		1,256		1,370
Other		9		10
Total revenue		66,893		68,756
Expenses:
Real estate operating expenses		17,151		17,308
Real estate taxes and insurance		11,177		12,403
Depreciation and amortization		24,035		25,332
General and administrative		3,432		3,443
Interest		9,486		7,579
Total expenses		65,281		66,065
Income before equity in losses of non-consolidated REITs, other, gain on sale of properties and properties held for sale, less applicable income tax and taxes		1,612		2,691
Equity in losses of non-consolidated REITs		(105)		(397)
Other		—		22
Gain on sale of properties and properties held for sale, less applicable income tax		—		2,289
Income before taxes on income		1,507		4,605
Taxes on income		82		125
Net income	$	1,425	$	4,480
Weighted average number of shares outstanding,  basic and diluted		107,231		107,231
Net income per share, basic and diluted	$	0.01	$	0.04

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Franklin Street Properties Corp. Financial Results

Supplementary Schedule B

Condensed Consolidated Balance Sheets

(Unaudited)

	March 31,		December 31,
(in thousands, except share and par value amounts)	2018		2017
Assets:
Real estate assets:
Land	$	191,578	$	191,578
Buildings and improvements		1,821,035		1,811,631
Fixtures and equipment		5,909		5,614
		2,018,522		2,008,823
Less accumulated depreciation		390,581		376,131
Real estate assets, net		1,627,941		1,632,692
Acquired real estate leases, less accumulated amortization of $114,044 and $109,771, respectively		78,729		86,520
Investment in non-consolidated REITs		69,703		70,164
Cash, cash equivalents and restricted cash		14,355		9,819
Tenant rent receivables, less allowance for doubtful accounts of $325 and $250, respectively		3,411		3,123
Straight-line rent receivable, less allowance for doubtful accounts of $50 and $50, respectively		53,430		53,194
Prepaid expenses and other assets		8,355		8,387
Related party mortgage loan receivables		71,455		71,720
Other assets: derivative asset		18,740		13,925
Office computers and furniture, net of accumulated depreciation of $1,448 and $1,420, respectively		261		289
Deferred leasing commissions, net of accumulated amortization of $23,255 and $22,276, respectively		39,815		40,679
Total assets	$	1,986,195	$	1,990,512
Liabilities and Stockholders’ Equity:
Liabilities:
Bank note payable	$	98,000	$	78,000
Term loans payable, less unamortized financing costs of $4,741 and $5,099, respectively		765,259		764,901
Series A&B Senior Notes, less unamortized financing costs of $1,273 and $1,308, respectively		198,727		198,692
Accounts payable and accrued expenses		53,327		61,039
Accrued compensation		1,112		3,641
Tenant security deposits		5,588		5,383
Other liabilities: derivative liabilities		—		1,759
Acquired unfavorable real estate leases, less accumulated amortization of $8,063 and $7,638, respectively		5,264		5,805
Total liabilities		1,127,277		1,119,220
Commitments and contingencies
Stockholders’ Equity:
Preferred stock, $.0001 par value, 20,000,000 shares authorized, none issued or outstanding		-		-
Common stock, $.0001 par value, 180,000,000 shares authorized, 107,231,155 and 107,231,155 shares issued and outstanding, respectively		11		11
Additional paid-in capital		1,356,457		1,356,457
Accumulated other comprehensive loss		18,740		12,166
Accumulated distributions in excess of accumulated earnings		(516,290)		(497,342)
Total stockholders’ equity		858,918		871,292
Total liabilities and stockholders’ equity	$	1,986,195	$	1,990,512

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Franklin Street Properties Corp. Financial Results

Supplementary Schedule C

Condensed Consolidated Statements of Cash Flows

(Unaudited)

	For the
	Three Months Ended
	March 31,
(in thousands)	2018		2017
Cash flows from operating activities:
Net income	$	1,425	$	4,480
Adjustments to reconcile net income or loss to net cash provided by operating activities:
Depreciation and amortization expense		24,748		25,937
Amortization of above and below market leases		(85)		(168)
Equity in losses of non-consolidated REITs		105		397
Hedge ineffectiveness		—		(22)
(Gain) on sale of properties and properties held for sale, less applicable income tax		—		(2,289)
Increase in allowance for doubtful accounts		75		—
Changes in operating assets and liabilities:
Tenant rent receivables		(363)		(672)
Straight-line rents		40		(1,082)
Lease acquisition costs		(276)		(292)
Prepaid expenses and other assets		(274)		1
Accounts payable, accrued expenses and other items		(6,911)		(10,219)
Accrued compensation		(2,529)		(2,525)
Tenant security deposits		205		86
Payment of deferred leasing commissions		(1,082)		(1,606)
Net cash provided by operating activities		15,078		12,026
Cash flows from investing activities:
Property improvements, fixtures and equipment		(10,774)		(11,615)
Distributions in excess of earnings from non-consolidated REITs		355		346
Repayment of related party mortgage loan receivable		265		265
Proceeds received on sales of real estate assets		—		6,160
Net cash used in investing activities		(10,154)		(4,844)
Cash flows from financing activities:
Distributions to stockholders		(20,374)		(20,374)
Borrowings under bank note payable		30,000		30,000
Repayments of bank note payable		(10,000)		(15,000)
Deferred financing costs		(14)		—
Net cash used in financing activities		(388)		(5,374)
Net increase in cash, cash equivalents and restricted cash		4,536		1,808
Cash, cash equivalents and restricted cash, beginning of year		9,819		9,366
Cash, cash equivalents and restricted cash, end of period	$	14,355	$	11,174

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Franklin Street Properties Corp. Earnings Release

Supplementary Schedule D

Real Estate Portfolio Summary Information

(Unaudited & Approximated)

Commercial portfolio lease expirations (1)
	Total	% of
Year	Square Feet	Portfolio
2018	984,501	10.1%
2019	1,225,298	12.6%
2020	843,681	8.6%
2021	687,821	7.0%
2022	1,195,787	12.2%
Thereafter (2)	4,823,569	49.5%
	9,760,657	100.0%

(1) Percentages are determined based upon total square footage.   

(2) Includes 1,118,651 square feet of current vacancies.

(dollars & square feet in 000's)	As of March 31 ,2018
	# of			% of	Square	% of
State	Properties	Investment		Portfolio	Feet	Portfolio
Colorado	6	$	537,825	33.5%	2,609	26.7%
Texas	9		349,548	21.8%	2,417	24.8%
Georgia	5		322,499	20.1%	1,967	20.2%
Minnesota (a)	2		94,642	5.9%	620	6.3%
Virginia	4		85,764	5.3%	685	7.0%
North Carolina	2		51,741	3.2%	322	3.3%
Missouri	2		48,712	3.0%	351	3.6%
Illinois	2		46,948	2.9%	372	3.8%
Florida	1		38,577	2.4%	213	2.2%
Indiana	1		30,673	1.9%	205	2.1%
Total	34	$	1,606,929	100.0%	9,761	100.0%

(a) Excludes approximately $21,012, which is our investment in a property that was redeveloped and is classified as non-operating.       

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Franklin Street Properties Corp. Earnings Release

Supplementary Schedule E

Portfolio and Other Supplementary Information

(Unaudited & Approximated)

Recurring Capital Expenditures

Owned Portfolio

(in thousands)	For the Three Months Ended
	31-Mar-18
Tenant improvements	$	6,777
Deferred leasing costs		1,021
Non-investment capex		1,858
	$	9,656

	For the Three Months Ended								Year Ended
	31-Mar-17		30-Jun-17		30-Sep-17		31-Dec-17		31-Dec-17
Tenant improvements	$	6,474	$	5,363	$	4,474	$	4,166	$	20,477
Deferred leasing costs		1,579		1,963		4,482		5,869		13,893
Non-investment capex		1,670		1,685		1,860		3,836		9,051
	$	9,723	$	9,011	$	10,816	$	13,871	$	43,421

Square foot & leased percentages	March 31,	December 31,
	2018	2017
Owned portfolio of commercial real estate
Number of properties (a)	34	34
Square feet	9,760,657	9,761,984
Leased percentage	88.5%	89.7%
Investments in non-consolidated REITs
Number of properties	2	2
Square feet	1,396,493	1,396,071
Leased percentage	74.4%	75.3%
Single Asset REITs (SARs) managed
Number of properties	4	4
Square feet	810,278	810,278
Leased percentage	96.1%	93.0%
Total owned, investments & managed properties
Number of properties	40	40
Square feet	11,967,428	11,968,333
Leased percentage	87.4%	88.2%

(a) Excludes one property that was redeveloped and is classified as non-operating. 

The following table shows property information for our investments in non-consolidated REITs:

			Square	% Leased	% Interest
Single Asset REIT name	City	State	Feet	31-Mar-18	Held
FSP 303 East Wacker Drive Corp.	Chicago	IL	861,422	74.7%	43.7%
FSP Grand Boulevard Corp.	Kansas City	MO	535,071	74.1%	27.0%
			1,396,493	74.4%

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Franklin Street Properties Corp. Earnings Release

Supplementary Schedule F

Percentage of Leased Space

(Unaudited & Estimated)

					Fourth		First
				% Leased (1)	Quarter	% Leased (1)	Quarter
				as of	Average %	as of	Average %
	Property Name	Location	Square Feet	31-Dec-17	Leased (2)	31-Mar-18	Leased (2)
1	FOREST PARK	Charlotte, NC	62,212	100.0%	100.0%	100.0%	100.0%
2	MEADOW POINT	Chantilly, VA	138,537	100.0%	100.0%	100.0%	100.0%
3	TIMBERLAKE	Chesterfield, MO	234,496	100.0%	100.0%	100.0%	100.0%
4	TIMBERLAKE EAST	Chesterfield, MO	117,036	100.0%	100.0%	100.0%	100.0%
5	NORTHWEST POINT	Elk Grove Village, IL	177,095	100.0%	100.0%	100.0%	100.0%
6	PARK TEN	Houston, TX	157,460	68.6%	69.8%	75.8%	73.4%
7	PARK TEN PHASE II	Houston, TX	156,746	1.4%	1.4%	1.4%	1.4%
8	GREENWOOD PLAZA	Englewood, CO	196,236	100.0%	100.0%	100.0%	100.0%
9	ADDISON	Addison, TX	288,794	100.0%	100.0%	100.0%	100.0%
10	COLLINS CROSSING	Richardson, TX	300,887	100.0%	100.0%	100.0%	100.0%
11	INNSBROOK	Glen Allen, VA	298,456	100.0%	100.0%	100.0%	100.0%
12	RIVER CROSSING	Indianapolis, IN	205,059	96.2%	97.0%	96.1%	96.1%
13	LIBERTY PLAZA	Addison, TX	218,934	91.2%	91.2%	84.5%	88.6%
14	380 INTERLOCKEN	Broomfield, CO	240,358	86.2%	86.2%	86.2%	86.2%
15	390 INTERLOCKEN	Broomfield, CO	241,512	98.9%	98.9%	97.8%	97.8%
16	BLUE LAGOON	Miami, FL	212,619	100.0%	100.0%	100.0%	100.0%
17	ELDRIDGE GREEN	Houston, TX	248,399	100.0%	100.0%	100.0%	100.0%
18	ONE OVERTON PARK	Atlanta, GA	387,267	61.1%	61.9%	61.1%	61.1%
19	LOUDOUN TECH	Dulles, VA	136,658	95.7%	95.7%	95.7%	95.7%
20	4807 STONECROFT	Chantilly, VA	111,469	100.0%	100.0%	100.0%	100.0%
21	121 SOUTH EIGHTH ST	Minneapolis, MN	293,422	81.8%	81.9%	77.7%	78.9%
22	EMPEROR BOULEVARD	Durham, NC	259,531	100.0%	100.0%	100.0%	100.0%
23	LEGACY TENNYSON CTR	Plano, TX	202,600	86.4%	79.1%	86.4%	86.4%
24	ONE LEGACY	Plano, TX	214,110	100.0%	100.0%	100.0%	100.0%
25	909 DAVIS	Evanston, IL	195,098	91.5%	82.6%	92.3%	92.0%
26	ONE RAVINIA DRIVE	Atlanta, GA	386,602	92.4%	90.8%	92.4%	92.4%
27	TWO RAVINIA	Atlanta, GA	411,047	75.3%	75.9%	76.0%	75.8%
28	WESTCHASE I & II	Houston, TX	629,025	87.7%	87.7%	86.0%	86.5%
29	1999 BROADWAY	Denver, CO	676,379	80.2%	81.5%	80.6%	80.3%
30	999 PEACHTREE	Atlanta, GA	621,946	95.1%	94.5%	88.6%	90.7%
31	1001 17th STREET	Denver, CO	655,413	96.8%	93.1%	96.8%	96.8%
32	PLAZA SEVEN	Minneapolis, MN	326,483	96.8%	96.8%	85.9%	93.2%
33	PERSHING PLAZA	Atlanta, GA	160,145	97.4%	97.4%	97.4%	97.4%
34	600 17th STREET	Denver, CO	598,626	87.1%	88.4%	84.6%	85.3%
	TOTAL WEIGHTED AVERAGE		9,760,657	89.7%	89.3%	88.5%	89.0%

(1) % Leased as of month's end includes all leases that expire on the last day of the quarter.

(2) Average quarterly percentage is the average of the end of the month leased percentage for each of the 3 months during the quarter.   

-11-

Franklin Street Properties Corp. Earnings Release

Supplementary Schedule G

Largest 20 Tenants – FSP Owned Portfolio

(Unaudited & Estimated)

The following table includes the largest 20 tenants in FSP’s owned portfolio based on total square feet:

As of March 31, 2018

			% of
	Tenant	Sq Ft	Portfolio
1	Quintiles IMS Healthcare Incorporated	259,531	2.7%
2	US Government	250,520	2.6%
3	CITGO Petroleum Corporation	248,399	2.5%
4	Newfield Exploration Company	234,495	2.4%
5	Centene Management Company, LLC	216,879	2.2%
6	Burger King Corporation	212,619	2.2%
7	Eversheds Sutherland (US) LLP	179,868	1.8%
8	EOG Resources, Inc.	160,937	1.6%
9	T-Mobile South, LLC dba T-Mobile	151,792	1.6%
10	Citicorp Credit Services, Inc.	146,260	1.5%
11	Petrobras America, Inc.	144,813	1.5%
12	Jones Day	140,342	1.4%
13	Argo Data Resource Corporation	140,246	1.4%
14	Vail Corp d/b/a Vail Resorts	132,229	1.4%
15	SunTrust Bank	127,500	1.3%
16	Federal National Mortgage Association	123,144	1.3%
17	Kaiser Foundation Health Plan	120,979	1.2%
18	Giesecke & Devrient America	112,110	1.1%
19	Northrup Grumman Systems Corp.	111,469	1.1%
20	ADS Alliance Data Systems, Inc.	107,698	1.1%
	Total	3,321,830	34.0%

-12-

Franklin Street Properties Corp. Earnings Release

Supplementary Schedule H

Reconciliation and Definitions of Funds From Operations (“FFO”) and

Adjusted Funds From Operations (“AFFO”)

A reconciliation of Net income (loss) to FFO and AFFO is shown below and a definition of FFO and AFFO is provided on Supplementary Schedule I.  Management believes FFO and AFFO are used broadly throughout the real estate investment trust (REIT) industry as measurements of performance.   The Company has included the National Association of Real Estate Investment Trusts (NAREIT) FFO definition as of May 17, 2016 in the table and notes that other REITs may not define FFO in accordance with the current NAREIT definition or may interpret the current NAREIT definition differently.  The Company’s computation of FFO and AFFO may not be comparable to FFO or AFFO reported by other REITs or real estate companies that define FFO or AFFO differently. 

Reconciliation of Net Income (Loss) to FFO and AFFO:	Three Months Ended
	March 31,
(In thousands, except per share amounts)	2018		2017
Net income	$	1,425	$	4,480
(Gain) on sale of properties and properties held for sale, less applicable income tax		—		(2,289)
GAAP loss from non-consolidated REITs		105		397
FFO from non-consolidated REITs		884		791
Depreciation & amortization		23,950		25,163
NAREIT FFO		26,364		28,542
Hedge ineffectiveness		—		(22)
Acquisition costs of new properties		—		8
Funds From Operations (FFO)	$	26,364	$	28,528
Funds From Operations (FFO)	$	26,364	$	28,528
Reverse FFO from non-consolidated REITs		(884)		(791)
Distributions from non-consolidated REITs		355		346
Amortization of deferred financing costs		711		606
Straight-line rent		40		(1,082)
Tenant improvements		(6,777)		(6,474)
Leasing commissions		(1,021)		(1,579)
Non-investment capex		(1,858)		(1,670)
Adjusted Funds From Operations (AFFO)	$	16,930	$	17,884
Per Share Data
EPS	$	0.01	$	0.04
FFO	$	0.25	$	0.27
AFFO	$	0.16	$	0.17
Weighted average shares (basic and diluted)		107,231		107,231

-13-

Funds From Operations (“FFO”)

The Company evaluates performance based on Funds From Operations, which we refer to as FFO, as management believes that FFO represents the most accurate measure of activity and is the basis for distributions paid to equity holders.  The Company defines FFO as net income or loss (computed in accordance with GAAP), excluding gains (or losses) from sales of property, hedge ineffectiveness and acquisition costs of newly acquired properties that are not capitalized, plus depreciation and amortization, including amortization of acquired above and below market lease intangibles and impairment charges on properties or investments in non-consolidated REITs, and after adjustments to exclude equity in income or losses from, and, to include the proportionate share of FFO from, non-consolidated REITs. 

FFO should not be considered as an alternative to net income or loss (determined in accordance with GAAP), nor as an indicator of the Company’s financial performance, nor as an alternative to cash flows from operating activities (determined in accordance with GAAP), nor as a measure of the Company’s liquidity, nor is it necessarily indicative of sufficient cash flow to fund all of the Company’s needs. 

Other real estate companies and NAREIT may define this term in a different manner.  We have included the NAREIT FFO as of May 17, 2016 in the table and note that other REITs may not define FFO in accordance with the current NAREIT definition or may interpret the current NAREIT definition differently than we do. 

We believe that in order to facilitate a clear understanding of the results of the Company, FFO should be examined in connection with net income or loss and cash flows from operating, investing and financing activities in the consolidated financial statements.

Adjusted Funds From Operations (“AFFO”)

The Company also evaluates performance based on Adjusted Funds From Operations, which we refer to as AFFO.  The Company defines AFFO as (1) FFO, (2) excluding our proportionate share of FFO and including distributions received, from non-consolidated REITs, (3) excluding the effect of straight-line rent, (4) plus deferred financing costs and (5) less recurring capital expenditures that are generally for maintenance of properties, which we call non-investment capex or are second generation capital expenditures.  Second generation costs include re-tenanting space after a tenant vacates, which include tenant improvements and leasing commissions. 

We exclude development/redevelopment activities, capital expenditures planned at acquisition and costs to reposition a property. We also exclude first generation leasing costs, which are generally to fill vacant space in properties we acquire or were planned for at acquisition. 

AFFO should not be considered as an alternative to net income or loss (determined in accordance with GAAP), nor as an indicator of the Company’s financial performance, nor as an alternative to cash flows from operating activities (determined in accordance with GAAP), nor as a measure of the Company’s liquidity, nor is it necessarily indicative of sufficient cash flow to fund all of the Company’s needs.  Other real estate companies may define this term in a different manner.  We believe that in order to facilitate a clear understanding of the results of the Company, AFFO should be examined in connection with net income or loss and cash flows from operating, investing and financing activities in the consolidated financial statements. 

-14-

Franklin Street Properties Corp. Earnings Release

Supplementary Schedule I

Reconciliation and Definition of Sequential Same Store results to property Net Operating Income (NOI) and Net Income (Loss) 

Net Operating Income (“NOI”)

The Company provides property performance based on Net Operating Income, which we refer to as NOI.  Management believes that investors are interested in this information.  NOI is a non-GAAP financial measure that the Company defines as net income or loss (the most directly comparable GAAP financial measure) plus general and administrative expenses, depreciation and amortization, including amortization of acquired above and below market lease intangibles and impairment charges, interest expense, less equity in earnings of nonconsolidated REITs, interest income, management fee income, hedge ineffectiveness, gains or losses on the sale of assets and excludes non-property specific income and expenses. The information presented includes footnotes and the data is shown by region with properties owned in the periods presented, which we call Sequential Same Store.  The comparative Sequential Same Store results include properties held for the periods presented and exclude properties that are non-operating, being developed or redeveloped, dispositions and significant nonrecurring income such as bankruptcy settlements and lease termination fees.  NOI, as defined by the Company, may not be comparable to NOI reported by other REITs that define NOI differently. NOI should not be considered an alternative to net income or loss as an indication of our performance or to cash flows as a measure of the Company’s liquidity or its ability to make distributions.  The calculations of NOI and Sequential Same Store are shown in the following table:

	Rentable
	Square Feet	Three Months Ended		Three Months Ended		Inc		%
(in thousands)	or RSF	31-Mar-18		31-Dec-17		(Dec)		Change
Region
East	1,007	$	3,991	$	3,917	$	74	1.9	%
MidWest	1,549		6,257		4,940		1,317	26.7	%
South	4,597		15,431		16,168		(737)	(4.6)	%
West	2,608		10,958		11,352		(394)	(3.5)	%
Same Store	9,761		36,637		36,377		260	0.7	%
Acquisitions	—		—		—		—	—	%
NOI* from the continuing portfolio	9,761		36,637		36,377		260	0.7	%
Dispositions, Non-Operating, Development or Redevelopment	-		79		(77)		156	0.4	%
NOI*	9,761	$	36,716	$	36,300	$	416	1.1	%
Sequential Same Store		$	36,637	$	36,377	$	260	0.7	%
Less Nonrecurring
Items in NOI* (a)			761		914		(153)	0.5	%
Comparative
Sequential Same Store		$	35,876	$	35,463	$	413	1.2	%

-15-

	Three Months Ended		Three Months Ended
Reconciliation to Net income	31-Mar-18		31-Dec-17
Net income (loss)	$	1,425	$	(4,932)
Add (deduct):
Loss on sale of properties and property held for sale, less applicable income taxes		—		21
Hedge ineffectiveness		—		2,096
Management fee income		(746)		(756)
Depreciation and amortization		24,035		25,659
Amortization of above/below market leases		(85)		(90)
General and administrative		3,432		3,665
Interest expense		9,486		8,657
Interest income		(1,120)		(1,133)
Equity in losses of non-consolidated REITs		105		2,885
Non-property specific items, net		184		228
NOI*	$	36,716	$	36,300

(a) Nonrecurring Items in NOI include proceeds from bankruptcies, lease termination fees or other significant nonrecurring income or expenses, which may affect comparability.

*Excludes NOI from investments in and interest income from secured loans to non-consolidated REITs.

EX-99.2

Exhibit 99.2 

Franklin Street Properties

Supplemental Operating
and Financial Data

First Quarter 2018

Franklin Street Properties Corp. 401 Edgewater Place ● Wakefield, MA 01880 (781) 557-1300 ● www.fspreit.com

Table of Contents

	Page		Page
Company Information	3	Tenant Analysis and Leasing Activity
		Tenants by Industry	18
Key Financial Data		20 Largest Tenants with Annualized Rent and Remaining Term	19
Financial Highlights	4	Leasing Activity	20
Income Statements	5	Lease Expirations by Square Feet	21
Balance Sheets	6	Lease Expirations with Annualized Rent per Square Foot	22
Cash Flow Statements	7	Capital Expenditures	23
Property Net Operating Income (NOI)	8
		Transaction Activity	24
Reconciliation
FFO & AFFO	9	Loan Portfolio of Secured Real Estate	25
EBITDA	10
Property NOI	11	Net Asset Value Components	26
Debt Summary	12	Appendix: Definitions of Non-GAAP Measures
		FFO	27
Capital Analysis	13	EBITDA and NOI	28
		AFFO	29
Owned and Managed Portfolio Overview	14-17

All financial information contained in this supplemental information package is unaudited.  In addition, certain statements contained in this supplemental information package may be deemed to be forward-looking statements within the meaning of the federal securities laws.  Although FSP believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved.  Factors that could cause actual results to differ materially from FSP’s current expectations include general economic conditions, uncertainties relating to fiscal policy, changes in government regulations, regulatory uncertainty, geopolitical events, local real estate conditions, the performance of properties that FSP has acquired or may acquire, the timely lease-up of properties and other risks, which are detailed from time to time in FSP’s reports filed with the Securities and Exchange Commission.  FSP assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

801 Marquette

March 31, 2018| Page 2

Company Information

Overview		Snapshot (as of March 31, 2018)
Franklin Street Properties Corp. (“FSP”, “we”, “our” or the “Company”) (NYSE American: FSP) is investing in institutional-quality office properties in the U.S.  FSP’s strategy is to invest in select urban infill and central business district (CBD) properties, with primary emphasis on our five core markets of Atlanta, Dallas, Denver, Houston, and Minneapolis.  FSP seeks value-oriented investments with an eye towards long-term growth and appreciation, as well as current income.  FSP is a Maryland corporation that operates in a manner intended to qualify as a real estate investment trust (REIT) for federal income tax purposes. FSP’s real estate operations include property acquisitions and dispositions, short-term financing, leasing, development and asset management.		Corporate Headquarters	Wakefield, MA
		Fiscal Year-End	31-Dec
		Total Properties	34
		Total Square Feet	9.8 Million
		Trading Symbol	FSP
		Exchange	NYSE American
		Common Shares Outstanding	107,231,155
		Quarterly Dividend	$0.09
Our Business		Dividend Yield	4.3%
As of March 31, 2018, the Company owned and operated a portfolio of real estate consisting of 34 properties, one property that has been redeveloped and is classified as non-operating and six managed Sponsored REITs, and held four promissory notes secured by mortgages on real estate owned by Sponsored REITs. From time-to-time, the Company may acquire, develop or redevelop real estate, make additional secured loans or acquire one of its Sponsored REITs. The Company may also pursue, on a selective basis, the sale of its properties in order to take advantage of the value creation and demand for its properties, or for geographic or property specific reasons.		Total Market Capitalization	$2.0 Billion*
		Insider Holdings	4.0%
Management Team
George J. Carter	Jeffrey B. Carter
Chief Executive Officer and	President and Chief Investment
Chairman of the Board	Officer
John G. Demeritt	Scott H. Carter
Executive Vice President, Chief	Executive Vice President, General
Financial Officer and Treasurer	Counsel and Secretary
John F. Donahue	Eriel Anchondo
Executive Vice President	Executive Vice President and Chief Operating Officer	Greenwood Plaza, Englewood, CO
Inquiries
Inquiries should be directed to:  Georgia Touma
877.686.9496 or InvestorRelations@fspreit.com * Total Market Capitalization is the closing share price multiplied by the number of shares outstanding plus total debt      outstanding.

March 31, 2018| Page 3

Summary of Financial Highlights

(in thousands except per share amounts, SF & number of properties)
	31-Mar-18		31-Dec-17		30-Sep-17		30-Jun-17		31-Mar-17
Income Items:
Rental revenue	$	65,628	$	65,555	$	67,339	$	66,995	$	67,376
Total revenue		66,893		66,835		68,626		68,371		68,756
Adjusted EBITDA*		34,943		34,033		35,354		35,525		35,036
Equity in losses of non-consolidated REITs		(105)		(2,885)		(121)		(201)		(397)
Net income (loss)		1,425		(4,932)		1,903		(17,395)		4,480
FFO*		26,364		26,347		27,991		28,571		28,528
AFFO*		16,930		13,044		17,110		18,919		17,884
Per Share Data:
EPS	$	0.01	$	(0.05)	$	0.02	$	(0.16)	$	0.04
FFO*	$	0.25	$	0.25	$	0.26	$	0.27	$	0.27
AFFO*	$	0.16	$	0.12	$	0.16	$	0.18	$	0.17
Weighted Average Shares (diluted)		107,231		107,231		107,231		107,231		107,231
Closing share price	$	8.41	$	10.74	$	10.62	$	11.08	$	12.14
Dividend declared	$	0.09	$	0.19	$	0.19	$	0.19	$	0.19
AFFO Payout Ratio:		57%		156%		119%		108%		114%
Balance Sheet Items:
Real estate, net	$	1,627,941	$	1,632,692	$	1,635,706	$	1,640,551	$	1,686,154
Other assets, net		358,254		357,820		395,979		402,016		392,132
Total assets, net		1,986,195		1,990,512		2,031,685		2,042,567		2,078,286
Total liabilities, net		1,127,277		1,119,220		1,142,299		1,134,723		1,130,263
Shareholders' equity		858,918		871,292		889,386		907,844		948,023
Market Capitalization and Debt:
Total Market Capitalization (a)	$	1,969,814	$	2,199,663	$	2,208,795	$	2,253,121	$	2,366,786
Total debt outstanding (excluding unamortized financing costs)		1,068,000		1,048,000		1,070,000		1,065,000		1,065,000
Debt to Total Market Capitalization		54.2%		47.6%		48.4%		47.3%		45.0%
Net Debt to Adjusted EBITDA*		7.5		7.6		7.5		7.4		7.5
Owned Portfolio Leasing Statistics (b):
Owned portfolio assets		34		34		35		35		35
Portfolio total SF		9,760,657		9,761,984		10,085,889		10,084,710		10,118,112
Portfolio % leased		88.5%		89.7%		88.7%		88.1%		89.6%

(a) Total Market Capitalization is the closing share price multiplied by the number of shares outstanding plus total debt outstanding on that date.

(b) For periods in 2018 and 2017, excludes one property that was redeveloped and is classified as non-operating, which is located in Minneapolis, Minnesota.

*See pages 9 & 10 for reconciliations of Net income or loss to FFO, AFFO and Adjusted EBITDA, respectively, and the Appendix for Definitions of these Non-GAAP Measures beginning on page 27.

March 31, 2018| Page 4

Condensed Consolidated Income Statements ($ in thousands, except per share amounts)

											For the
	Three Months Ended		For the Three Months Ended								Year Ended
	31-Mar-18		31-Mar-17		30-Jun-17		30-Sep-17		31-Dec-17		31-Dec-17
Revenue:
Rental	$	65,628	$	67,376	$	66,995	$	67,339	$	65,555	$	267,265
Related party revenue:
Management fees and interest income from loans		1,256		1,370		1,366		1,278		1,271		5,285
Other		9		10		10		9		9		38
Total revenue		66,893		68,756		68,371		68,626		66,835		272,588
Expenses:
Real estate operating expenses		17,151		17,308		17,286		17,898		18,720		71,212
Real estate taxes and insurance		11,177		12,403		11,595		11,882		9,961		45,841
Depreciation and amortization		24,035		25,332		25,279		24,988		25,659		101,258
General and administrative		3,432		3,443		3,077		3,286		3,665		13,471
Interest		9,486		7,579		7,893		8,258		8,657		32,387
Total expenses		65,281		66,065		65,130		66,312		66,662		264,169
Income before equity in losses of non-consolidated REITs, other, gain (loss) on sale of properties and properties held for sale, less applicable income tax and taxes		1,612		2,691		3,241		2,314		173		8,419
Equity in losses of non-consolidated REITs		(105)		(397)		(201)		(121)		(2,885)		(3,604)
Other		—		22		129		67		(2,096)		(1,878)
Gain (loss) on sale of properties and provision for loss on properties held for sale, less applicable income tax		—		2,289		(20,492)		(257)		(21)		(18,481)
Income (loss) before taxes on income		1,507		4,605		(17,323)		2,003		(4,829)		(15,544)
Income tax expense		82		125		72		100		103		400
Net income (loss)	$	1,425	$	4,480	$	(17,395)	$	1,903	$	(4,932)	$	(15,944)
Weighted average number of shares outstanding, basic and diluted		107,231		107,231		107,231		107,231		107,231		107,231
Net income (loss) per share, basic and diluted	$	0.01	$	0.04	$	(0.16)	$	0.02	$	(0.05)	$	(0.15)

March 31, 2018| Page 5

	$ in thousands, except per share amounts)
	Condensed Consolidated Balance Sheets (in thousands)

	March 31,		March 31,		June 30,		September 30,		December 31,
	2018		2017		2017		2017		2017
Assets:
Real estate assets:
Land	$	191,578	$	196,178	$	191,578	$	191,578	$	191,578
Buildings and improvements		1,821,035		1,836,073		1,792,784		1,800,831		1,811,631
Fixtures and equipment		5,909		4,600		4,841		5,017		5,614
		2,018,522		2,036,851		1,989,203		1,997,426		2,008,823
Less accumulated depreciation		390,581		350,697		348,652		361,720		376,131
Real estate assets, net		1,627,941		1,686,154		1,640,551		1,635,706		1,632,692
Acquired real estate leases, net		78,729		115,471		105,811		96,282		86,520
Investment in non-consolidated REITs		69,703		74,423		73,876		73,405		70,164
Asset held for sale		—		—		31,868		31,615		—
Cash, cash equivalents and restricted cash		14,355		11,174		11,623		12,710		9,819
Tenant rent receivables, net		3,411		3,785		4,706		3,990		3,123
Straight-line rent receivable, net		53,430		52,304		51,590		52,272		53,194
Prepaid expenses and other assets		8,355		4,946		5,124		6,282		8,387
Related party mortgage loan receivable		71,455		81,515		72,250		71,985		71,720
Other assets: derivative asset		18,740		13,603		11,333		10,771		13,925
Office computers and furniture, net of accumulated depreciation		261		275		287		319		289
Deferred leasing commissions, net		39,815		34,636		33,548		36,348		40,679
Total assets	$	1,986,195	$	2,078,286	$	2,042,567	$	2,031,685	$	1,990,512
Liabilities and Stockholders’ Equity:
Liabilities:
Bank note payable	$	98,000	$	295,000	$	295,000	$	300,000	$	78,000
Term loan payable, net of unamortized financing costs		765,259		765,539		765,861		766,183		764,901
Series A & Series B Senior Notes		198,727		—		—		—		198,692
Accounts payable and accrued expenses		53,327		50,529		55,241		57,593		61,039
Accrued compensation		1,112		1,259		1,929		3,000		3,641
Tenant security deposits		5,588		5,441		5,367		5,431		5,383
Other liabilities: derivative liabilities		—		4,351		4,364		3,721		1,759
Acquired unfavorable real estate leases, net		5,264		8,144		6,961		6,371		5,805
Total liabilities		1,127,277		1,130,263		1,134,723		1,142,299		1,119,220
Commitments and contingencies
Stockholders’ Equity:
Preferred stock		-		-		-		-		-
Common stock		11		11		11		11		11
Additional paid-in capital		1,356,457		1,356,457		1,356,457		1,356,457		1,356,457
Accumulated other comprehensive income (loss)		18,740		7,351		4,940		4,954		12,166
Accumulated distributions in excess of accumulated earnings		(516,290)		(415,796)		(453,564)		(472,036)		(497,342)
Total stockholders’ equity		858,918		948,023		907,844		889,386		871,292
Total liabilities and stockholders’ equity	$	1,986,195	$	2,078,286	$	2,042,567	$	2,031,685	$	1,990,512

March 31, 2018| Page 6

Condensed Consolidated Statements of Cash Flows (in thousands)

		Three Months ended March 31,			Twelve Months Ended December 31,
		2018		2017	2017		2016
Cash flows from operating activities:
Net income (loss)	$	1,425	$	4,480	$	(15,944)	$	8,378
Adjustments to reconcile net income or loss to net cash provided by operating activities:
Depreciation and amortization expense		24,748		25,937		103,743		95,243
Amortization of above and below market leases		(85)		(168)		(1,031)		(496)
Hedge ineffectiveness		—		(22)		1,878		(1,878)
(Gain) loss on sale of properties and properties held for sale, less applicable income tax		—		(2,289)		18,481		2,938
Equity in earnings (losses) from non-consolidated REITs		105		397		3,604		831
Increase (decrease) in allowance for doubtful accounts		75		—		150		(30)
Changes in operating assets and liabilities:
Tenant rent receivables		(363)		(672)		(160)		(185)
Straight-line rents		40		(1,082)		(1,767)		(1,977)
Lease acquisition costs		(276)		(292)		(2,052)		(1,095)
Prepaid expenses and other assets		(274)		1		(403)		(721)
Accounts payable and accrued expenses		(6,911)		(10,219)		3,870		5,751
Accrued compensation		(2,529)		(2,525)		(143)		58
Tenant security deposits		205		86		28		526
Payment of deferred leasing commissions		(1,082)		(1,606)		(14,309)		(12,965)
Net cash provided by operating activities		15,078		12,026		95,945		94,378
Cash flows from investing activities:
Property acquisitions		—		—		—		(221,119)
Acquired real estate leases		—		—		—		(51,509)
Property improvements, fixtures and equipment		(10,774)		(11,615)		(54,306)		(37,490)
Distributions in excess of earnings from non-consolidated REITs		355		346		1,396		1,023
Investment in related party mortgage loan receivable		—		—		—		(3,000)
Repayment of related party mortgage loan receivable		265		265		10,060		39,861
Proceeds received on sales of real estate assets		—		6,160		37,756		27,262
Net cash used in investing activities		(10,154)		(4,844)		(5,094)		(244,972)
Cash flows from financing activities:
Distributions to stockholders		(20,374)		(20,374)		(81,496)		(77,481)
Proceeds (costs) from equity offering, net		—		—		—		82,902
Borrowings under bank note payable		30,000		30,000		75,000		175,000
Repayments of bank note payable		(10,000)		(15,000)		(277,000)		(185,000)
Borrowing from Series A & Series B Senior Notes		—		—		200,000		—
Borrowing of term loan payable		—		—		—		150,000
Deferred Financing Costs		(14)		—		(6,902)		(3,647)
Net cash provided by (used in) financing activities		(388)		(5,374)		(90,398)		141,774
Net increase (decrease) in cash, cash equivalents and restricted cash		4,536		1,808		453		(8,820)
Cash, cash equivalents and restricted cash, beginning of period		9,819		9,366		9,366		18,186
Cash, cash equivalents and restricted cash, end of period	$	14,355	$	11,174	$	9,819	$	9,366

March 31, 2018| Page 7

Property Net Operating Income (NOI)* with Same Store Comparison (in thousands)

	Rentable
	Square Feet	Three Months Ended		Three Months Ended		Inc		%
(in thousands)	or RSF	31-Mar-18		31-Mar-17		(Dec)		Change
Region
East	1,007	$	3,991	$	3,917	$	74	1.9	%
MidWest	1,549		6,257		4,365		1,892	43.3	%
South	4,597		15,431		17,008		(1,577)	(9.3)	%
West	2,608		10,958		10,958		—	—	%
Same Store	9,761		36,637		36,248		389	1.1	%
Acquisitions	—		—		—		—	—	%
Property NOI* from the continuing portfolio	9,761		36,637		36,248		389	1.1	%
Dispositions, Non-Operating, Development or Redevelopment	-		79		625		(546)	(1.5)	%
Property NOI*	9,761	$	36,716	$	36,873	$	(157)	(0.4)	%
Same Store		$	36,637	$	36,248	$	389	1.1	%
Less Nonrecurring
Items in NOI* (a)			761		65		696	(1.9)	%
Comparative
Same Store		$	35,876	$	36,183	$	(307)	(0.8)	%

(a) Nonrecurring items in NOI include proceeds from bankruptcies, lease termination fees or other significant nonrecurring income or expenses, which may affect comparability. 

*See the Appendix for Definition of Non-GAAP Measures beginning on page 27.

March 31, 2018| Page 8

FFO* & AFFO* Reconciliation (in thousands, except per share amounts)

											Year
	Three Months Ended		Three Months Ended								Ended
	31-Mar-18		31-Mar-17		30-Jun-17		30-Sep-17		31-Dec-17		31-Dec-17
Net income (loss)	$	1,425	$	4,480	$	(17,395)	$	1,903	$	(4,932)	$	(15,944)
(Gain) loss on sale of properties and properties held for sale, less applicable income tax		—		(2,289)		20,492		257		21		18,481
GAAP income from non-consolidated REITs		105		397		201		121		2,885		3,604
FFO from non-consolidated REITs		884		791		800		874		708		3,173
Depreciation & amortization		23,950		25,163		24,592		24,903		25,569		100,227
NAREIT FFO*		26,364		28,542		28,690		28,058		24,251		109,541
Hedge ineffectiveness		—		(22)		(129)		(67)		2,096		1,878
Acquisition costs		—		8		10		—		—		18
Funds From Operations (FFO)*	$	26,364	$	28,528	$	28,571	$	27,991	$	26,347	$	111,437
Adjusted Funds From Operations (AFFO)*
Funds From Operations (FFO)*	$	26,364	$	28,528	$	28,571	$	27,991	$	26,347	$	111,437
Reverse FFO from non-consolidated REITs		(884)		(791)		(800)		(874)		(708)		(3,173)
Distributions from non-consolidated REITs		355		346		345		350		355		1,396
Amortization of deferred financing costs		711		606		606		606		667		2,485
Straight-line rent		40		(1,082)		(792)		(147)		254		(1,767)
Tenant improvements		(6,777)		(6,474)		(5,363)		(4,474)		(4,166)		(20,477)
Leasing commissions		(1,021)		(1,579)		(1,963)		(4,482)		(5,869)		(13,893)
Non-investment capex		(1,858)		(1,670)		(1,685)		(1,860)		(3,836)		(9,051)
Adjusted Funds From Operations (AFFO)*	$	16,930	$	17,884	$	18,919	$	17,110	$	13,044	$	66,957
Per Share Data:
EPS	$	0.01	$	0.04	$	(0.16)	$	0.02	$	(0.05)	$	(0.15)
FFO*		0.25		0.27		0.27		0.26		0.25		1.04
AFFO*		0.16		0.17		0.18		0.16		0.12		0.62
Weighted Average Shares (basic and diluted)		107,231		107,231		107,231		107,231		107,231		107,231

*See the Appendix for Definitions of these Non-GAAP Measures beginning on page 27

March 31, 2018| Page 9

EBITDA* & Adjusted EBITDA* Reconciliation (in thousands, except ratio amounts)

											Year
	Three Months Ended		Three Months Ended								Ended
	31-Mar-18		31-Mar-17		30-Jun-17		30-Sep-17		31-Dec-17		31-Dec-17
Net income (loss)	$	1,425	$	4,480	$	(17,395)	$	1,903	$	(4,932)	$	(15,944)
Interest expense		9,486		7,579		7,893		8,258		8,657		32,387
Depreciation and amortization		23,950		25,163		24,592		24,903		25,569		100,227
Income taxes		82		125		72		100		103		400
EBITDA*		34,943		37,347		15,162		35,164		29,397		117,070
(Gain) loss on sale of properties and provisions for loss on properties held for sale or equity investments, less applicable income tax		—		(2,289)		20,492		257		2,540		21,000
Hedge ineffectiveness		—		(22)		(129)		(67)		2,096		1,878
Adjusted EBITDA*	$	34,943	$	35,036	$	35,525	$	35,354	$	34,033	$	139,948
Interest expense	$	9,486	$	7,579	$	7,893	$	8,258	$	8,657	$	32,387
Scheduled principal payments		—		—		—		—		—		—
Interest and scheduled principal payments	$	9,486	$	7,579	$	7,893	$	8,258	$	8,657	$	32,387
Interest coverage ratio		3.68		4.62		4.50		4.28		3.93		4.32
Debt service coverage ratio		3.68		4.62		4.50		4.28		3.93		4.32
Debt excluding unamortized financing costs	$	1,068,000	$	1,065,000	$	1,065,000	$	1,070,000	$	1,048,000
Cash, cash equivalents and restricted cash		14,355		11,174		11,623		12,710		9,819
Net Debt ( Debt less Cash, cash equivalents and restricted cash)	$	1,053,645	$	1,053,826	$	1,053,377	$	1,057,290	$	1,038,181
Adjusted EBITDA*	$	34,943	$	35,036	$	35,525	$	35,354	$	34,033
Annualized	$	139,772	$	140,144	$	142,100	$	141,416	$	136,132
Net Debt-to-Adjusted EBITDA*		7.5		7.5		7.4		7.5		7.6

*See the Appendix for Definitions of these Non-GAAP Measures beginning on page 27.  Amounts in the EBITDA and Adjusted EBITDA reconciliation do not reflect our proportionate share of interest expense, depreciation, amortization, income taxes, gains or losses on sales and debt from our investments in non-consolidated REITs, which are accounted for under the equity method.

March 31, 2018| Page 10

Reconciliation of Net Income (Loss) to Property NOI* (in thousands)

Reconciliation of Net income to Property NOI*
	Three Months Ended		Three Months Ended
	31-Mar-18		31-Mar-17
Net income (loss)	$	1,425	$	4,480
Add (deduct):
(Gain) loss on sale of properties and properties held for sale, less applicable income taxes		—		(2,289)
Hedge ineffectiveness		—		(22)
Management fee income		(746)		(794)
Depreciation and amortization		24,035		25,332
Amortization of above/below market leases		(85)		(168)
General and administrative		3,432		3,443
Interest expense		9,486		7,579
Interest income		(1,120)		(1,214)
Equity in losses of non-consolidated REITs		105		397
Non-property specific items, net		184		129
Property NOI*	$	36,716	$	36,873

*See the Appendix for Definition of Non-GAAP Measures beginning on page 27.

March 31, 2018| Page 11

Debt Summary (in thousands)

		Maximum		Amount		Interest			Interest
	Maturity	Amount		Drawn at		Rate (a)			Rate at	Facility
	Date	of Loan		31-Mar-18		Components			31-Mar-18	Fee
BAML Revolver	12-Jan-22	$	600,000	$	98,000	L	+	1.20%	3.08%	0.25%
JPM Term Loan	30-Nov-18		150,000		150,000	L	+	1.35%	3.29%
BAML Term Loan	12-Jan-23		400,000		400,000	1.12%	+	1.35%	2.47%
BMO Term Loan	26-Aug-20		220,000		220,000	2.32%	+	1.65%	3.97%
Series A Senior Notes	20-Dec-24		116,000		116,000				3.99%
Series B Senior Notes	20-Dec-27		84,000		84,000				4.26%
		$	1,570,000	$	1,068,000				3.26%

· On October 18, 2017, we recast our credit facility with Bank of America, N.A., as administrative agent, to, among other things, (i) increase the borrowing capacity of the revolving line of credit from $500 million to $600 million, (ii) extend the maturity date applicable to the revolving line of credit from October 29, 2018 to January 12, 2022 (with two optional six month extensions), (iii) extend the maturity date applicable to the term loan from September 27, 2021 to January 12, 2023, (iv) modify certain financial covenants, including a reset of minimum tangible net worth, and (v) increase the accordion feature from $350 million to $500 million.  Pricing is based on our investment grade rating.  At our investment grade rating from Moody’s of Baa3, pricing on the borrowing spread decreased by five basis points for the revolving line of credit and by ten basis points for the term loan.  We also simultaneously amended our term loan with Bank of Montreal, as administrative agent, and our term loan with JPMorgan Chase Bank, N.A., as administrative agent, to conform the financial covenants and certain other provisions.

· The BAML Revolver is subject to a 25 basis point facility fee at our investment grade rating and when applied to our new availability of $600 million would be $1.5 million annually.     

· On October 24, 2017, we entered into a note purchase agreement relating to a private placement of $200 million in an aggregate principal amount of unsecured senior notes, consisting of $116 million in aggregate principal amount of 3.99% Series A Senior Notes with a 7-year maturity and $84 million in aggregate principal amount of 4.26% Series B Senior Notes with a 10-year maturity.  On December 20, 2017, we drew the proceeds from the private placement and reduced the outstanding balance on our revolving line of credit. 

· We incurred financing costs to close the BAML Revolver, BAML Term Loan and the BMO Term Loan and the credit facilities that preceded them.  We also incurred financing costs in connection with the JPM Term Loan and with the Series A and Series B Senior Notes.  These costs are deferred and amortized into interest expense during the terms of the loans.  Following the amendments on October 18, 2017 and the note purchase agreement on October 24, 2017, we estimate the annual run rate for amortization to interest expense from these deferred financing costs is approximately $2.9 million.

· Additional information on these transactions can be found in a Current Report on Form 8-K that the Company filed with the U.S. Securities and Exchange Commission on October 24, 2017. 

(a) Interest rate excludes amortization of deferred financing costs and facility fees, which is discussed in the notes above.

March 31, 2018| Page 12

Capital Analysis (in thousands, except per share amounts)

	31-Mar-18		31-Mar-17		30-Jun-17		30-Sep-17		31-Dec-17
Market Data:
Shares Outstanding		107,231		107,231		107,231		107,231		107,231
Closing market price per share	$	8.41	$	12.14	$	11.08	$	10.62	$	10.74
Market capitalization	$	901,814	$	1,301,786	$	1,188,121	$	1,138,795	$	1,151,663
Total debt outstanding excluding unamortized financing costs		1,068,000		1,065,000		1,065,000		1,070,000		1,048,000
Total Market Capitalization	$	1,969,814	$	2,366,786	$	2,253,121	$	2,208,795	$	2,199,663
Dividend Data:
Total dividends declared for the quarter	$	9,650.80	$	20,374	$	20,374	$	20,374	$	20,374
Common dividend declared per share	$	0.09	$	0.19	$	0.19	$	0.19	$	0.19
Declared dividend as a % of Net income (loss) per share		677%		455%		-117%		1071%		-413%
Declared dividend as a % of AFFO* per share		57%		114%		108%		119%		156%
Liquidity:
Cash, cash equivalents and restricted cash	$	14,355	$	11,174	$	11,623	$	12,710	$	9,819
Revolver:
Gross potential available under the BAML Revolver		600,000		500,000		500,000		500,000		600,000
Less:
Outstanding balance		(98,000)		(295,000)		(295,000)		(300,000)		(78,000)
Total Liquidity	$	516,355	$	216,174	$	216,623	$	212,710	$	531,819

*See page 9 for a reconciliation of Net Income (Loss) to AFFO and the Appendix for Definitions of Non-GAAP Measures beginning on page 27.

March 31, 2018| Page 13

Owned Portfolio Overview

	As of the Quarter Ended
	31-Mar-18	31-Dec-17	30-Sep-17	30-Jun-17	31-Mar-17
Owned portfolio of commercial real estate:
Number of properties (a)	34	34	35	35	35
Square feet	9,760,657	9,761,984	10,085,889	10,084,710	10,118,112
Leased percentage	88.5%	89.7%	88.7%	88.1%	89.6%
Investments in non-consolidated commercial real estate:
Number of properties	2	2	2	2	2
Square feet	1,396,493	1,396,071	1,396,071	1,396,071	1,396,071
Leased percentage	74.4%	75.3%	79.2%	78.9%	78.9%
Single Asset REITs (SARs) managed:
Number of properties	4	4	4	4	5
Square feet	810,278	810,278	810,278	810,278	1,075,135
Leased percentage	96.1%	93.0%	89.9%	90.1%	89.6%
Total owned, investments and managed properties:
Number of properties	40	40	41	41	42
Square feet	11,967,428	11,968,333	12,292,238	12,291,059	12,589,318
Leased percentage	87.4%	88.2%	87.7%	87.2%	88.5%
(a) Excludes one property that was redeveloped and is classified as non-operating.

March 31, 2018| Page 14

Owned Portfolio Overview

				Percent	Wtd Occupied	GAAP						Percent	Wtd Occupied	GAAP
MSA / Property Name	City	State	Square Feet	Leased	Percentage (a)	Rent (b)		MSA / Property Name	City	State	Square Feet	Leased	Percentage (a)	Rent (b)
East Region								Midwest Region
Washington, D.C.								Chicago
Meadow Point	Chantilly	VA	138,537	100.0%	100.0%	$	27.13	Northwest Point	Elk Grove Village	IL	177,095	100.0%	100.0%	$	33.15
Stonecroft	Chantilly	VA	111,469	100.0%	100.0%	$	38.84	909 Davis Street	Evanston	IL	195,098	92.3%	78.2%	$	36.79
Loudoun Tech Center	Dulles	VA	136,658	95.7%	95.8%	$	18.64
								Indianapolis
Richmond								River Crossing	Indianapolis	IN	205,059	96.1%	95.6%	$	23.77
Innsbrook	Glen Allen	VA	298,456	100.0%	100.0%	$	15.15
								St. Louis
Charlotte								Timberlake	Chesterfield	MO	234,496	100.0%	100.0%	$	30.08
Forest Park	Charlotte	NC	62,212	100.0%	100.0%	$	13.63	Timberlake East	Chesterfield	MO	117,036	100.0%	100.0%	$	30.29
Raleigh-Durham								Minneapolis
Emperor Boulevard	Durham	NC	259,531	100.0%	100.0%	$	34.51	121 South 8th Street	Minneapolis	MN	293,422	77.7%	74.8%	$	21.69
								Plaza Seven	Minneapolis	MN	326,483	85.9%	93.2%	$	34.61
East Region Total			1,006,863	99.4%	99.4%	$	24.83	Midwest Region Total			1,548,689	91.3%	90.5%	$	30.00

(a) Weighted Occupied Percentage for the three months ended March 31, 2018.

(b) Weighted Average GAAP Rent per Occupied Square Foot.

March 31, 2018| Page 15

Owned Portfolio Overview

				Percent	Wtd Occupied	GAAP						Percent	Wtd Occupied	GAAP
MSA / Property Name	City	State	Square Feet	Leased	Percentage (a)	Rent (b)		MSA / Property Name	City	State	Square Feet	Leased	Percentage (a)	Rent (b)
South Region								West Region
Dallas-Fort Worth								Denver
Legacy Tennyson Center	Plano	TX	202,600	86.4%	69.4%	$	19.13	380 Interlocken	Broomfield	CO	240,358	86.2%	86.2%	$	30.32
One Legacy Circle	Plano	TX	214,110	100.0%	100.0%	$	37.67	1999 Broadway	Denver	CO	676,379	80.6%	77.5%	$	30.21
Addison Circle	Addison	TX	288,794	100.0%	89.3%	$	33.50	Greenwood Plaza	Englewood	CO	196,236	100.0%	100.0%	$	25.13
Collins Crossing	Richardson	TX	300,887	100.0%	100.0%	$	24.32	390 Interlocken	Broomfield	CO	241,512	97.8%	97.8%	$	30.78
Liberty Plaza	Addison	TX	218,934	84.5%	88.6%	$	22.22	1001 17th Street	Denver	CO	655,413	96.8%	92.8%	$	35.26
								600 17th Street	Denver	CO	598,626	84.6%	85.1%	$	32.63
Houston								West Region Total			2,608,524	89.2%	87.4%	$	31.73
Park Ten	Houston	TX	157,460	75.8%	68.6%	$	29.13
Eldridge Green	Houston	TX	248,399	100.0%	100.0%	$	30.51	Total Owned			9,760,657	88.5%	87.1%	$	29.05
Park Ten Phase II	Houston	TX	156,746	1.4%	1.4%	$	2.80
Westchase I & II	Houston	TX	629,025	86.0%	83.4%	$	28.65
Miami-Ft. Lauderdale-West Palm Beach
Blue Lagoon Drive	Miami	FL	212,619	100.0%	100.0%	$	22.49
Atlanta
One Overton Park	Atlanta	GA	387,267	61.1%	61.1%	$	23.71
One Ravinia	Atlanta	GA	386,602	92.4%	91.1%	$	25.31
Two Ravinia	Atlanta	GA	411,047	76.0%	74.0%	$	27.07
Pershing Plaza	Atlanta	GA	160,145	97.4%	97.4%	$	35.75
999 Peachtree	Atlanta	GA	621,946	88.6%	90.5%	$	31.46
South Region Total			4,596,581	84.9%	83.0%	$	28.20

(a) Weighted Occupied Percentage for the three months ended March 31, 2018.

(b) Weighted Average GAAP Rent per Occupied Square Foot.

March 31, 2018| Page 16

Managed Portfolio Overview

MSA / Property Name	City	State	Square Feet		MSA / Property Name	City	State	Square Feet
Southeast Region					Midwest Region
Atlanta					Chicago
Satellite Place	Duluth	GA	134,785	(a)	East Wacker	Chicago	IL	861,422
					Indianapolis
					Monument Circle	Indianapolis	IN	213,760
Southeast Region Total			134,785
					Kansas City
				(b)	Grand Boulevard	Kansas City	MO	535,071
Southwest Region					Cincinnati
					Centre Pointe V	West Chester	OH	135,936
Houston
Energy Tower I	Houston	TX	325,797
Southwest Region Total			325,797		Midwest Region Total			1,746,189
					Total Managed			2,206,771
					Total Owned & Managed			11,967,428

(a) FSP has a Preferred Share Interest of 43.7% in the entity that owns this property.

(b) FSP has a Preferred Share Interest of 27.0% in the entity that owns this property.

March 31, 2018| Page 17

Tenants by Industry (By Square Feet)  

March 31, 2018| Page 18

20 Largest Tenants with Annualized Rent and Remaining Term

			Remaining	Aggregate				% of Aggregate
	Tenant	Number of	Lease Term	Leased	% of Total	Annualized		Leased
	Name	Leases	in Months	Square Feet	Square Feet	Rent		Annualized Rent
1	Quintiles IMS Healthcare Incorporated	1	98	259,531	2.7%	$	9,168,715	3.7%
2	US Government (a)	4	2, 17, 30, 34	250,520	2.6%		7,718,222	3.1%
3	CITGO Petroleum Corporation	1	47	248,399	2.5%		8,385,950	3.4%
4	Newfield Exploration Company	1	47	234,495	2.4%		9,164,598	3.7%
5	Centene Management Company, LLC	3	63, 63,  63	216,879	2.2%		5,582,310	2.2%
6	Burger King Corporation	1	6	212,619	2.2%		5,351,620	2.2%
7	Eversheds Sutherland (US) LLP	1	97	179,868	1.8%		5,334,134	2.1%
8	EOG Resources, Inc.	1	105	160,937	1.6%		5,268,843	2.1%
9	T-Mobile South, LLC dba T-Mobile	1	11	151,792	1.6%		3,969,427	1.6%
10	Citicorp Credit Services, Inc.	1	113	146,260	1.5%		4,886,547	2.0%
11	Petrobras America, Inc.	1	20	144,813	1.5%		5,372,562	2.2%
12	Jones Day	1	32	140,342	1.4%		4,919,841	2.0%
13	Argo Data Resource Corporation	1	65	140,246	1.4%		3,973,169	1.6%
14	Vail Corp d/b/a Vail Resorts (b)	3	12, 60, 60	132,229	1.4%		4,028,722	1.6%
15	SunTrust Bank	1	6	127,500	1.3%		4,623,150	1.9%
16	Federal National Mortgage Association	1	6	123,144	1.3%		4,483,673	1.8%
17	Kaiser Foundation Health Plan	1	74	120,979	1.2%		3,262,715	1.3%
18	Giesecke & Devrient America	1	81	112,110	1.1%		2,071,793	0.8%
19	Northrup Grumman Systems Corp.	1	21	111,469	1.1%		4,702,115	1.9%
20	ADS Alliance Data Systems, Inc.	1	99	107,698	1.1%		3,872,654	1.6%
			Total	3,321,830	34.0%	$	106,140,759	42.7%

(a) Includes 180,444 square feet, which expire in 2018.  The remaining 70,060 square feet expire between 2019 and 2021.

(b) Includes 38,293 square feet, which expire 3/31/19.  The remaining 93,936 square feet expire 3/31/23.  

March 31, 2018| Page 19

Leasing Activity (Owned Portfolio)

					Year		Year
	Three Months Ended				Ended		Ended
Leasing Activity		31-Mar-18		31-Mar-17		31-Dec-17		31-Dec-16
(in Square Feet - SF)
New leasing		84,000		62,000		460,000		299,000
Renewals and expansions		25,000		144,000		1,011,000		895,000
		109,000		206,000		1,471,000		1,194,000
Other information per SF
(Activity on a year-to-date basis)
GAAP Rents on leasing	$	30.42	$	28.36	$	30.43	$	29.64
Weighted average lease term		5.9 Years		5.6 Years		6.8 Years		6.6 Years
Increase or decrease over average GAAP rents in prior year (1)		-2.9%		7.4%		12.3%		10.4%
Average free rent		2 Months		3 Months		4 Months		3 Months
Tenant Improvements	$	26.35	$	23.02	$	22.22	$	18.71
Leasing Costs	$	8.18	$	8.32	$	9.92	$	10.05
(1) The increase or decrease percentage is calculated by comparing average GAAP rents at
properties that had leasing activity in the current year to average GAAP rents at the same
properties in the prior year.

March 31, 2018| Page 20

Lease Expirations by Square Feet (Owned Portfolio)

March 31, 2018| Page 21

Lease Expirations with Annualized Rent per Square Foot (Owned Portfolio)

			Rentable				Annualized		Percentage
	Number of		Square				Rent		of Total
Year of	Leases		Footage		Annualized		Per Square		Annualized
Lease	Expiring		Subject to		Rent Under		Foot Under		Rent Under
Expiration	Within the		Expiring		Expiring		Expiring		Expiring	Cumulative
December 31,	Year (a)		Leases		Leases (b)		Leases		Leases	Total
2018	52	(c)	984,501		$	31,402,783	$	31.90	12.6%	12.6%
2019	65		1,225,298			36,272,642		29.60	14.6%	27.2%
2020	66		843,681			27,964,284		33.15	11.2%	38.4%
2021	59		687,821			18,844,368		27.40	7.6%	46.0%
2022	63		1,195,787			38,685,025		32.35	15.6%	61.6%
2023	58		955,154			23,617,849		24.73	9.5%	71.1%
2024	26		514,172			15,474,895		30.10	6.2%	77.3%
2025	19		411,348			10,302,904		25.05	4.1%	81.4%
2026	11		636,611			20,625,233		32.40	8.3%	89.7%
2027	6		420,116			13,162,617		31.33	5.3%	95.0%
2028 and thereafter	89		767,517	(d)		12,403,633		16.16	5.0%	100.0%
	514		8,642,006		$	248,756,234	$	28.78	100.0%
Vacancies as of 3/31/18			1,118,651
Total Portfolio Square Footage			9,760,657

(a) The number of leases approximates the number of tenants. Tenants with lease maturities in different years are included in annual totals for each lease. Tenants may have multiple leases in the same year.

(b) Annualized rent represents the monthly rent charged, including tenant reimbursements, for each lease in effect at March 31, 2018 multiplied by 12. Tenant reimbursements generally include payment of real estate taxes, operating expenses and common area maintenance and utility charges.

(c) Includes 10 leases that are month-to-month.

(d) Includes 115,452 square feet that are non-revenue producing building amenities.

March 31, 2018| Page 22

Capital Expenditures

(in thousands)
	For the Three Months Ended
	31-Mar-18
Tenant improvements	$	6,777
Deferred leasing costs		1,021
Non-investment capex		1,858
Total Capital Expenditures	$	9,656

	For the Three Months Ended								Year ended
	31-Mar-17		30-Jun-17		30-Sep-17		31-Dec-17		31-Dec-17
Tenant improvements	$	6,474	$	5,363	$	4,474	$	4,166	$	20,477
Deferred leasing costs		1,579		1,963		4,482		5,869		13,893
Non-investment capex		1,670		1,685		1,860		3,836		9,051
Total Capital Expenditures	$	9,723	$	9,011	$	10,816	$	13,871	$	43,421

First generation leasing and investment capital was $1.4 million for the first quarter ended March 31, 2018 and $25.0 million for the year ended December 31, 2017.

March 31, 2018| Page 23

Transaction Activity (in thousands except for Square Feet)

	City	State	Square Feet	Date Acquired	Purchase Price
2016
Plaza Seven	Minneapolis	MN	325,796	6/6/16	$	82,000
Pershing Plaza	Atlanta	GA	160,145	8/10/16		45,450
600 17th Street	Denver	CO	613,527	12/1/16		154,260
2015
Two Ravinia	Atlanta	GA	442,130	4/8/15	$	78,000

					Gross Sale		Gain (loss)
	City	State	Square Feet	Date Sold	Proceeds		on Sale
2017
Hillview	Milpitas	CA	36,288	1/6/17	$	6,342	$	2,289
East Baltimore	Baltimore	MD	325,445	10/20/17		32,547		(20,770)
2016
Lakeside I	Maryland Heights	MO	127,778	4/5/16	$	20,189	$	4,154
Federal Way	Federal Way	WA	117,010	12/16/16		7,500		(7,092)
2015
Willow Bend	Plano	TX	117,050	2/23/15	$	20,750	$	1,462
Eden Bluff	Eden Prairie	MN	153,028	3/31/15		28,000		9,000
Park Seneca	Charlotte	NC	109,699	5/13/15		8,150		949
Montague	San Jose	CA	145,561	12/9/15		30,250		12,251

March 31, 2018| Page 24

Loan Portfolio of Secured Real Estate (in thousands)

(dollars in thousands)			Maximum		Amount						Interest
		Maturity	Amount		Drawn at		Interest			Draw	Rate at
Sponsored REIT	Location	Date	of Loan		31-Mar-18		Rate (1)			Fee (2)	31-Mar-18
Secured revolving lines of credit
FSP Satellite Place Corp.	Duluth, GA	31-Dec-19	$	5,500	$	1,855	L	+	4.40%	0.5%	6.09%
FSP Energy Tower I Corp.	Houston, TX	30-Jun-19		20,000		15,600	L	+	5.00%	0.5%	6.69%
Mortgage loan secured by property
FSP Monument Circle LLC (3)	Indianapolis, IN	7-Dec-18		21,000		21,000			4.90%	n/a	4.90%
FSP Energy Tower I Corp. (4)	Houston, TX	30-Jun-19		33,000		33,000			6.41%	n/a	6.41%
			$	79,500	$	71,455

(1) The interest rate is 30-day LIBOR rate plus the additional rate indicated, otherwise a fixed rate.

(2) The draw fee is a percentage of each new advance, and is paid at the time of each new draw.

(3) Includes an origination fee of $164,000 and an exit fee of $38,000 when repaid by the borrower.

(4) This mortgage includes an annual extension fee of $108,900 paid by the borrower. 

March 31, 2018| Page 25

Net Asset Value Components

(in thousands except per share data)
	Asof		Assets:			Other information:
	31-Mar-18		Loans outstanding on secured RE	$	71,455	Leased SF to be FFO producing
Total Market Capitalization Values			Investments in SARs (book basis)		69,703	During 2018 (in 000's)		172
Shares outstanding		107,231.2	Straight-line rent receivable		53,430
Closing price	$	8.41	Asset held for sale		—	Straight-line rental revenue current quarter	$	(40)
Market capitalization	$	901,814	Cash, cash equivalents and restricted cash		14,355
Debt		1,068,000	Tenant rent receivables		3,411	Management fee income current quarter	$	136
Total Market Capitalization	$	1,969,814	Prepaid expenses		3,623	Interest income from secured loans		1,120
			Office computers and furniture		261	Management fees and interest income from loans	$	1,256
			Other assets:
	3 Months		Deferred financing costs, net		10,746	FFO from non-consolidated REITs - Q4 2017 (6):
	Ended		Other assets: Derivative Market Value		18,740	East Wacker	$	685
NOI Components	31-Mar-18		Other assets		—	Grand Boulevard		23
				$	245,724	Total	$	708
Same Store NOI (1)	$	36,637
Acquisitions (1) (2)		—	Liabilities:			Footnotes to the components
Property NOI (1)		36,637	Debt (excluding contra for unamortized financing costs)	$	1,068,000
Full quarter adjustment (3)		—	Accounts payable & accrued expenses		54,439	(1) See pages 11 & 28 for definitions and reconciliations.
Stabilized portfolio	$	36,637	Tenant security deposits		5,588
			Other liabilities: derivative liability		—	(2) Includes NOI from acquisitions not in Same Store.
				$	1,128,027
Financial Statement Reconciliation:						(3) Adjustment to reflect property NOI for a full quarter in the quarter acquired, if necessary.
Rental Revenue	$	65,628
Rental operating expenses		(17,151)				(4) HB3 Tax in Texas is classified as an income tax, though we treat it as a real estate tax in Property NOI.
Real estate taxes and insurance		(11,177)
NOI on assets sold		(79)				(5) Management & other fees are eliminated in consolidation but included in Property NOI.
Taxes (4)		(82)
Management fees & other (5)		(502)				(6) We report FFO from non-consolidated REITs for the previous quarter as their financial statements are not yet complete for the current quarter.
Property NOI (1)	$	36,637

March 31, 2018| Page 26

Appendix: Non-GAAP Financial Measure Definitions

Definition of Funds From Operations (“FFO”)

The Company evaluates performance based on Funds From Operations, which we refer to as FFO, as management believes that FFO represents the most accurate measure of activity and is the basis for distributions paid to equity holders.  The Company defines FFO as net income or loss (computed in accordance with GAAP), excluding gains (or losses) from sales of property, hedge ineffectiveness and acquisition costs of newly acquired properties that are not capitalized, plus depreciation and amortization, including amortization of acquired above and below market lease intangibles and impairment charges on properties or investments in non-consolidated REITs, and after adjustments to exclude equity in income or losses from, and, to include the proportionate share of FFO from, non-consolidated REITs.

FFO should not be considered as an alternative to net income or loss (determined in accordance with GAAP), nor as an indicator of the Company’s financial performance, nor as an alternative to cash flows from operating activities (determined in accordance with GAAP), nor as a measure of the Company’s liquidity, nor is it necessarily indicative of sufficient cash flow to fund all of the Company’s needs.

Other real estate companies and the National Association of Real Estate Investment Trusts, or NAREIT, may define this term in a different manner. We have included the NAREIT FFO definition as of May 17, 2016 in the table on page 9 and note that other REITs may not define FFO in accordance with the current NAREIT definition or may interpret the current NAREIT definition differently than we do.

We believe that in order to facilitate a clear understanding of the results of the Company, FFO should be examined in connection with net income or loss and cash flows from operating, investing and financing activities in the consolidated financial statements.

March 31, 2018| Page 27

Appendix: Non-GAAP Financial Measure Definitions

Definition of Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA)
and Adjusted EBITDA

EBITDA is defined as net income or loss plus interest expense, income tax expense and depreciation and amortization expense. Adjusted EBITDA is defined as EBITDA excluding hedge ineffectiveness, gains and losses on sales of properties or shares of equity investments or provisions for losses on assets held for sale or equity investments. EBITDA and Adjusted EBITDA are not intended to represent cash flow for the period, are not presented as an alternative to operating income as an indicator of operating performance, should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP and are not indicative of operating income or cash provided by operating activities as determined under GAAP. EBITDA and Adjusted EBITDA are presented solely as a supplemental disclosure with respect to liquidity because the Company believes it provides useful information regarding the Company's ability to service or incur debt. Because all companies do not calculate EBITDA or Adjusted EBITDA the same way, this presentation may not be comparable to similarly titled measures of other companies. The Company believes that net income or loss is the financial measure calculated and presented in accordance with GAAP that is most directly comparable to EBITDA and Adjusted EBITDA.

Definition of Property Net Operating Income (Property NOI)

The Company provides property performance based on Net Operating Income, which we refer to as NOI. Management believes that investors are interested in this information. NOI is a non-GAAP financial measure that the Company defines as net income or loss (the most directly comparable GAAP financial measure) plus general and administrative expenses, depreciation and amortization, including amortization of acquired above and below market lease intangibles and impairment charges, interest expense, less equity in earnings of nonconsolidated REITs, interest income, management fee income, hedge ineffectiveness, gains or losses on the sale of assets and excludes non-property specific income and expenses. The information presented includes footnotes and the data is shown by region with properties owned in the periods presented, which we call Same Store. The comparative Same Store results include properties held for the periods presented and exclude properties that are non-operating, being developed or redeveloped, dispositions and significant nonrecurring income such as bankruptcy settlements and lease termination fees.  NOI, as defined by the Company, may not be comparable to NOI reported by other REITs that define NOI differently. NOI should not be considered an alternative to net income or loss as an indication of our performance or to cash flows as a measure of the Company's liquidity or its ability to make distributions.

March 31, 2018| Page 28

Appendix: Non-GAAP Financial Measure Definitions

Definition of Adjusted Funds From Operations (AFFO)

The Company also evaluates performance based on Adjusted Funds From Operations, which we refer to as AFFO.  The Company defines AFFO as (1) FFO, (2) excluding our proportionate share of FFO and including distributions received, from non-consolidated REITs, (3) excluding the effect of straight-line rent, (4) plus deferred financing costs and (5) less recurring capital expenditures that are generally for maintenance of properties, which we call non-investment capex or are second generation capital expenditures.  Second generation costs include re-tenanting space after a tenant vacates, which include tenant improvements and leasing commissions. 

We exclude development/redevelopment activities, capital expenditures planned at acquisition and costs to reposition a property. We also exclude first generation leasing costs, which are generally to fill vacant space in properties we acquire or were planned for at acquisition. 

AFFO should not be considered as an alternative to net income or loss (determined in accordance with GAAP), nor as an indicator of the Company’s financial performance, nor as an alternative to cash flows from operating activities (determined in accordance with GAAP), nor as a measure of the Company’s liquidity, nor is it necessarily indicative of sufficient cash flow to fund all of the Company’s needs.  Other real estate companies may define this term in a different manner.  We believe that in order to facilitate a clear understanding of the results of the Company, AFFO should be examined in connection with net income or loss and cash flows from operating, investing and financing activities in the consolidated financial statements. 

March 31, 2018| Page 29

Investor Relations Contact

Georgia Touma | 877.686.9496

InvestorRelations@fspreit.com

Franklin Street Properties Corp. 401 Edgewater Place ● Wakefield, MA 01880 (781) 557-1300 ● www.fspreit.com

March 31, 2018| Page 30