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): February 22, 2022

PS BUSINESS PARKS, INC.

(Exact name of registrant as specified in its charter)

Maryland

(State or Other Jurisdiction of Incorporation)

1-10709	95-4300881
(Commission File Number)	(I.R.S. Employer Identification Number)

701 Western Avenue, Glendale, California	91201-2349
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (818) 244-8080

N/A

(Former name or former address, if changed since last report)

Check the appropriate box if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol	Name of Each Exchange on Which Registered
Common Stock, $0.01 par value per share	PSB	New York Stock Exchange
Depositary Shares Each Representing 1/1,000 of a 5.250% Cum Pref Share, Series X, $0.01 par value	PSBPrX	New York Stock Exchange
Depositary Shares Each Representing 1/1,000 of a 5.200% Cum Pref Share, Series Y, $0.01 par value	PSBPrY	New York Stock Exchange
Depositary Shares Each Representing 1/1,000 of a 4.875% Cum Pref Share, Series Z, $0.01 par value	PSBPrZ	New York Stock Exchange

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

Emerging growth company          ☐

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

Item 2.02. Results of Operations and Financial Condition

On February 22, 2022, PS Business Parks, Inc. (the “Company”) reported its results of operations and financial condition for the quarter and year ended December 31, 2021. The full text of the press release issued in connection with this announcement is furnished as Exhibit 99.1 to this Current Report on Form 8-K. The Company’s Supplemental Information Package for the fourth quarter of 2021 is attached as Exhibit 99.2. The information in Item 2.02 of this Form 8-K and the Exhibits attached hereto pursuant to Item 9.01 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (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, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits

Exhibit 99.1	Press release dated February 22, 2022.
Exhibit 99.2	Supplemental Information, Fourth Quarter 2021.
Exhibit 104	Cover Page Interactive Data File (embedded within the Inline XBRL document).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	PS BUSINESS PARKS, INC.
Date: February 22, 2022	By:	/s/ Adeel Khan
		Adeel Khan
		Chief Financial Officer

EX-99.1

Exhibit 99.1

News Release   PS Business Parks, Inc. 701 Western Avenue Glendale, CA 91201-2349     psbusinessparks.com

For Release:	Immediately
Date:	February 22, 2022
Contact:	Adeel Khan
	(818) 244-8080, Ext. 8975

PS Business Parks, Inc. Reports Results for the Quarter and Year Ended December 31, 2021

GLENDALE, California—PS Business Parks, Inc. (NYSE:PSB), a real estate investment trust (“REIT”), today announced financial and operating results for the quarter and year ended December 31, 2021.

Financial and Operational Highlights for the Three Months and Year Ended December 31, 2021

● Net income allocable to common stockholders for the three months and year ended December 31, 2021 was $267.4 million, or $9.66 per diluted common share, and $393.1 million, or $14.22 per diluted common share, respectively.

● FFO for the three months and year ended December 31, 2021 was $1.53 per share and $6.67 per share, respectively, representing a decrease of -7.8% and an increase of 2.5% from the same periods in 2020.

● Core FFO for the three months and year ended December 31, 2021 was $1.81 and $6.97 per share, respectively, representing an increase of 9.0% and 6.1% from the same periods in 2020.

● Cash NOI for the Company’s total portfolio was $77.6 million and $306.8 million for the three months and year ended December 31, 2021, respectively, representing an increase of 4.8% and 7.0% for the same periods in 2020.

● Cash NOI for the Company’s Same Park portfolio was $71.8 million and $279.8 million for the three months and year ended December 31, 2021, respectively, representing an increase of 6.5% and 8.0% for the same periods in 2020.

● Weighted average occupancy for the Company’s Total Park portfolio was 95.5% and 94.3% during the three months and year ended December 31, 2021, respectively, compared to 92.4% and 92.2% for the same periods in 2020.

● Weighted average occupancy for the Company’s Same Park portfolio was 95.7% and 94.4% during the three months and year ended December 31, 2021, respectively, compared to 92.7% for both comparable periods in 2020.

● Comparable rental rates for the Company’s Total Park portfolio for the three and twelve months on 1.8 million and 7.4 million rentable square feet were 16.4% and 14.7% on a net effective rent growth basis, and 6.1% and 5.2% on a cash basis, respectively.

● During the three months ended December 31, 2021, the Company acquired Jupiter Business Park, a 141,000 square foot industrial business park located in Plano, Texas, for a total purchase price of $25.6 million, inclusive of capitalized transaction cost.

● During the three months ended December 31, 2021, the Company sold Lusk, a 371,000 square foot industrial-flex business park located in San Diego, California, for net sale proceeds of $311.1 million, Ammendale, a 53,000 square foot industrial building located in Beltsville, Maryland, for net sale proceeds of $4.5 million and Royal Tech 10, a 70,000 square foot industrial-flex building located in Irving, Texas, for net sale proceeds of $8.8 million.

1

Financial Results:

Net income allocable to common stockholders was $267.4 million or $9.66 per diluted share and $393.1 million or $14.22 per diluted share, for the three months and year ended December 31, 2021, respectively.

FFO for the quarter and year ended December 31, 2021 was $1.53 per share and $6.67 per share, respectively, representing a decrease of 7.8% and an increase of 2.5% from the same periods in 2020. The decrease in FFO per share for the fourth quarter was due to a $6.4 million non-cash charge related to the redemption of the Series W preferred stock and $3.6 million charge for a state income tax provision due to differences between state and federal tax codes. The increase in FFO per share for the year was the result of higher NOI, partially offset by the $6.4 million non-cash charge related to the redemption of the Series W preferred stock and the $3.6 million for state Income tax provision, as discussed above, as well as higher general and administrative expense primarily driven by stock compensation expense.

Core FFO for the quarter and year ended December 31, 2021 was $1.81 and $6.97 per share, respectively, representing an increase of 9.0% and 6.1% from the same periods in 2020. For the quarter ended December 31, 2021, Core FFO excludes the impact of (i) the $6.4 million non-cash charge related to the redemption of the Series W preferred stock and (ii) the $3.6 million of state income tax provision discussed above. For the year ended December 31, 2021, along with the items excluded for the quarter, Core FFO also excludes the impact of a one-time cost associated with the Company’s reincorporation as a Maryland corporation of $0.5 million incurred during the second quarter of 2021. For the year ended December 31, 2020, Core FFO excludes the impact of (i) accelerated amortization of stock compensation expense of $1.7 million related to the retirement of our former President and CEO and (ii) non-capitalizable demolition costs of $0.3 million.

FAD for the quarter and year ended December 31, 2021 was $54.3 million and $210.7 million, respectively, representing an increase of 13.2% and 10.8%, respectively, from the same periods in 2020.The increase in FAD for the quarter and year ended December 31, 2021 and 2020 is primarily attributable to higher Cash NOI driven by higher weighted average occupancy, higher rent growth, decrease in rent deferrals (net of amounts repaid,) a decrease in rent abatements in 2021 compared to the same periods in prior year and lower preferred distributions resulting from the redemption of Series W preferred stock during fourth quarter of 2021.

Same Park NOI was $72.2 million and $280.9 million for the three months and year ended December 31, 2021, respectively, representing increases of 8.6% and 7.0% over the same periods in 2020, respectively.

The Company also reports NOI on a cash basis, which excludes non-cash rental income such as amortization of deferred rent receivable and other non-cash items, and also excludes rents that have been deferred or abated during the period. Same Park Cash NOI was $71.8 million and $279.8 million for the quarter and year ended December 31, 2021, respectively, representing increases of 6.5% and 8.0% over the same periods in 2020, respectively. The increase in Same Park Cash NOI for the three months ended December 31, 2021 was primarily driven by higher weighted average occupancy in the fourth quarter of 2021, which was 95.7% versus 92.7% in the fourth quarter of 2020. The increase in Same Park Cash NOI for the year ended December 31, 2021 was primarily driven by higher weighted average occupancy, which was 94.4% in 2021 versus 92.7% in 2020. The Company noted that Same Park Cash Rental Income per occupied square foot increased by 4.9% during the year, from $15.76 in 2020 to $16.53 in 2021.

2

The following table presents the unaudited details of the change in Same Park rental income for the three months and years ended December 31, 2021 and 2020 (in thousands):

	For the Three Months											For the Years
	Ended December 31,											Ended December 31,
	2021			2020			$ Change			% Change		2021			2020			$ Change			% Change
Rental income
Base rental income	$	74,607		$	70,432		$	4,175			5.9%	$	291,169		$	280,499		$	10,670			3.8%
Expense recovery income		24,591			22,265			2,326			10.4%		96,248			88,534			7,714			8.7%
Lease buyout income		538			257			281			109.3%		1,856			1,044			812			77.8%
Rent receivable recovery/(write-off)		(73	)		(195	)		122			(62.6%)		(12	)		(1,515	)		1,503			(99.2%)
Abatements		(8	)		(96	)		88			(91.7%)		(312	)		(1,285	)		973			(75.7%)
Deferrals		—			(109	)		109			(100.0%)		(292	)		(5,253	)		4,961			(94.4%)
Deferral repayments		250			1,787			(1,537	)		(86.0%)		1,773			2,953			(1,180	)		(40.0%)
Fee Income		101			225			(124	)		(55.1%)		695			904			(209	)		(23.1%)
Cash Rental Income		100,006			94,566			5,440			5.8%		391,125			365,881			25,244			6.9%
Non-Cash Rental Income (1)		414			(959	)		1,373			(143.2%)		1,096			3,567			(2,471	)		(69.3%)
Total rental income	$	100,420		$	93,607		$	6,813			7.3%	$	392,221		$	369,448		$	22,773			6.2%

⁽¹⁾ Non-cash rental income includes amortization of deferred rent receivable (net of write-offs), in-place lease intangible, tenant improvement reimbursement, and lease incentives.

The following table presents the unaudited operating results of the Company’s Same Park facilities for the three months and years ended December 31, 2021 and 2020 (in thousands, except per square foot amounts):

	For the Three Months										For the Years
	Ended December 31,										Ended December 31,
	2021		2020			$ Change			% Change		2021		2020		$ Change			% Change
Rental income
Cash Rental Income (1) (2)	$	100,006	$	94,566		$	5,440			5.8%	$	391,125	$	365,881	$	25,244			6.9%
Non-Cash Rental Income (1) (3)		414		(959	)		1,373			(143.2%)		1,096		3,567		(2,471	)		(69.3%)
Total rental income		100,420		93,607			6,813			7.3%		392,221		369,448		22,773			6.2%
Adjusted Cost of Operations (1)
Property taxes		9,936		9,827			109			1.1%		41,958		41,184		774			1.9%
Utilities		4,746		4,235			511			12.1%		18,066		17,170		896			5.2%
Repairs and maintenance		6,452		6,680			(228	)		(3.4%)		23,064		22,697		367			1.6%
Compensation		4,137		3,835			302			7.9%		16,082		15,522		560			3.6%
Snow removal		9		162			(153	)		(94.4%)		1,021		233		788			338.2%
Property insurance		1,227		1,036			191			18.4%		4,778		3,943		835			21.2%
Other expenses		1,678		1,340			338			25.2%		6,364		6,111		253			4.1%
Total Adjusted Cost of Operations		28,185		27,115			1,070			3.9%		111,333		106,860		4,473			4.2%
NOI (1)	$	72,235	$	66,492		$	5,743			8.6%	$	280,888	$	262,588	$	18,300			7.0%
Cash NOI (1)	$	71,821	$	67,451		$	4,370			6.5%	$	279,792	$	259,021	$	20,771			8.0%
Selected Statistical Data
Rentable square footage at period end		25,053		25,053			—			—		25,053		25,053		—			—
NOI margin (1)		71.9%		71.0%			—			0.9%		71.6%		71.1%		—			0.5%
Cash NOI margin (1)		71.8%		71.3%			—			0.5%		71.5%		70.8%		—			0.7%
Weighted average square foot occupancy		95.7%		92.7%			—			3.0%		94.4%		92.7%		—			1.7%
Revenue per Occupied Square Foot (1)	$	16.74	$	16.12		$	0.62			3.8%	$	16.58	$	15.91	$	0.67			4.2%
Revenue per Available Foot (RevPAF) (1)	$	16.03	$	14.95		$	1.08			7.2%	$	15.66	$	14.75	$	0.91			6.2%
Cash Rental Income per Occupied Square Foot (1)	$	16.67	$	16.29		$	0.38			2.3%	$	16.53	$	15.76	$	0.77			4.9%
Cash Rental Income per Available Foot (1)	$	15.97	$	15.10		$	0.87			5.8%	$	15.61	$	14.60	$	1.01			6.9%

⁽¹⁾ Defined in Definitions/Non-GAAP Discussion.

⁽²⁾ Detail of the components of Cash Rental Income can be found in the table presented under financial results above.

⁽³⁾ Same Park Non-Cash Rental Income is presented net of deferred rent receivable write-offs of $0.1 million and $0.4 million for the three months ended December 31, 2021 and 2020, respectively, and $0.3 million and $3.0 million for the years ended December 31, 2021 and 2020, respectively.

3

Operating Results:

Total portfolio weighted average occupancy⁽¹⁾ was 95.5% and 94.3% during the three and twelve months ended December 31, 2021, respectively, compared to 92.4% and 92.2% for the same periods in 2020.

Leasing Production ⁽²⁾

During the three months and year ended December 31, 2021, the Company executed leases on 1.8 million and 7.4 million square feet, respectively, compared to 1.8 million and 7.1 million for the three months and year ended December 31, 2020, respectively. The table below represents cash rental rate growth and net effective rent growth ⁽³⁾ by product type for leases executed during the three months and year ended December 31, 2021.

	For the Three Months ended December 31, 2021						For the Twelve Months ended December 31, 2021
Product type	Leasing       volume		Cash rental       rate growth		Net effective rent   growth(3)		Leasing     volume		Cash rental       rate growth		Net effective rent   growth(3)
Industrial		1,246,000		11.5%		25.7%		5,211,000		9.4%		21.7%
Industrial-flex		302,000		1.2%		8.0%		1,514,000		1.0%		7.2%
Office		207,000		-2.3%		4.7%		712,000		-5.6%		0.7%
Total		1,755,000		6.1%		16.4%		7,437,000		5.2%		14.7%

The average lease term of the leases executed during the three months ended December 31, 2021 was 3.6 years, with associated average transaction costs (tenant improvements and leasing commissions) of $3.15 per square foot. For comparative purposes, average lease term and transaction costs on leases executed in the same period of 2020 were 3.3 years and $2.90 per square foot, respectively.

For the three and twelve months ended December 31, 2021 and for all comparative periods presented herein, the Company has excluded assets held for sale as of December 31, 2021 as follows:

● 702,000 square foot industrial-flex business park located in Irving, Texas.

For the three and twelve months ended December 31, 2021 and for all comparative periods presented herein, the Company has also excluded assets sold in 2021 as follows:

● 198,000 square foot office-oriented flex business park located in Chantilly, Virginia, sold in June 2021;

● 244,000 square foot office park located in Herndon, Virginia, sold in July 2021;

● 22,000 square foot industrial-flex building located in Irving, Texas, sold in September 2021;

● 371,000 square foot industrial-flex business park located in San Diego, California, sold in October 2021;

● 53,000 square foot industrial building located in Beltsville, Maryland, sold in December 2021, and

● 70,000 square foot industrial-flex business building located in Irving, Texas, sold in December 2021.

Also excluded from the respective periods in 2020 are assets sold comprising 40,000 square feet sold in September 2020 and 113,000 square feet sold in January 2020.

⁽¹⁾ Total portfolio occupancy statistics exclude assets sold or held for sale as of December 31, 2021.

⁽²⁾ Leasing Production excludes assets sold or held for sale as of December 31, 2021.

⁽³⁾ Net effective rent represents average rental payments for the term of a lease on a straight-line basis in accordance with U.S. generally accepted accounting principles (“GAAP”) and excludes operating expense reimbursements.

4

Quarterly Financial Data

The following table summarizes unaudited selected quarterly financial data with respect to the Same Park portfolio (in thousands, except per square foot amounts.)

	For the Three Months Ended
	March 31		June 30		September 30		December 31		Full Year
Cash Rental income (1)
2021	$	95,010	$	96,948	$	99,161	$	100,006	$	391,125
2020	$	93,109	$	86,705	$	91,501	$	94,566	$	365,881
Adjusted Cost of Operations (1)
2021	$	28,017	$	26,661	$	28,470	$	28,185	$	111,333
2020	$	26,669	$	25,439	$	27,637	$	27,115	$	106,860
Cash NOI (1)
2021	$	66,993	$	70,287	$	70,691	$	71,821	$	279,792
2020	$	66,440	$	61,266	$	63,864	$	67,451	$	259,021
Weighted average square foot occupancy
2021		93.2%		93.9%		94.8%		95.7%		94.4%
2020		92.9%		92.4%		92.6%		92.7%		92.7%
Cash Rental Income per Occupied Square Foot (1)
2021	$	16.28	$	16.49	$	16.70	$	16.67	$	16.53
2020	$	16.00	$	14.97	$	15.78	$	16.29	$	15.76
Cash Rental Income per Available Square Foot (1)
2021	$	15.17	$	15.48	$	15.83	$	15.97	$	15.61
2020	$	14.87	$	13.84	$	14.61	$	15.10	$	14.60

⁽¹⁾ Defined in Definitions/Non-GAAP Discussion.

COVID-19 Pandemic/Rent Collections Update

During the three months ended December 31, 2021, the Company granted $0 of rent deferral and $0 of rent abatement compared to the $0.2 million of rent deferral and $0.1 million of rent abatement granted for the three months ended December 31, 2020. During the year ended December 31, 2021, the Company granted $0.5 million of rent deferral and $0.3 million of rent abatement which was significantly lower than the $5.7 million of rent deferrals and $1.3 million of rent abatements granted during the year ended December 31, 2020. Since the onset of the COVID-19 pandemic, the Company has entered into rent relief agreements consisting of $6.2 million of rent deferrals and $1.6 million of rent abatements. As of December 31, 2021, the 317 current customers that received rent relief account for 9.5% of rental income. Also as of December 31, 2021, the Company had collected $5.3 million of rent deferral repayment, representing 99.8% of the amounts scheduled to be repaid through December 2021. An additional $0.9 million of rent deferral repayment is scheduled to be repaid thereafter.

As of February 18, 2022, the Company had collected 99.9% of revenue billed during the year ended December 31, 2021. The Company noted that the fourth quarter of 2021 marked the sixth consecutive quarter of normal accounts receivable write-off activity. During the three months and year ended December 31, 2021, the Company wrote off $0.1 million and $0.1 million of accounts receivable, net of recoveries, respectively, compared to $0.2 million and $1.6 million written off during the three months and year ended December 31, 2020, respectively. During the three months and year ended December 31, 2021, the Company wrote off $0.1 million and $0.3 million of deferred rent receivable, respectively, which is significantly lower than the $0.4 million and $3.1 million written off during the three months and year ended December 31, 2020, respectively.

5

As of December 31, 2021, the Company had open rent relief requests from less than 1% of its customers. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations–Certain Factors that May Impact Future Results–Impact of COVID-19 Pandemic” in our Form 10-K for the year ended December 31, 2021 for more information.

Acquisition and Dispositions Update

In December 2021, the Company acquired Jupiter Business Park, a 141,000 square foot industrial business park located in Plano, Texas, for a total purchase price of $25.6 million, inclusive of capitalized transaction cost.

In December 2021, the Company sold a 53,000 square foot industrial building, that was part of Ammendale, located in Beltsville, Maryland, for net sale proceeds of $4.5 million and gain on sale of $3.2 million and Royal Tech 10 a 70,000 square foot industrial-flex business park located in Irving, Texas, for net sale proceeds of $8.8 million and gain on sale of $6.3 million.

In October 2021, the Company sold Lusk, a 371,000 square foot industrial-flex business park located in San Diego, California, for net sale proceeds of $311.1 million and gain on sale of $301.2 million.

Capital Activity

On November 3, 2021, the Company redeemed all outstanding depositary shares representing interests in its 5.20% Cumulative Preferred Stock, Series W, at $25.00 per share plus accrued dividends from October 1, 2021, through the date of redemption. The aggregate redemption amount, inclusive of prorated dividends, paid to the holders was $190.7 million. The Company recorded a non-cash charge related to the redemption of preferred securities of $6.4 million for the three months and year ended December 31, 2021.

Distributions Declared

On February 21, 2022, the Company’s Board of Directors declared a quarterly dividend of $1.05 per common share. Distributions were also declared on the various series of depositary shares, each representing 1/1,000 of a share of preferred stock. Distributions for both shares of common stock and preferred stock will be payable on March 31, 2022 to stockholders of record on March 16, 2022.

Supplemental Information and Investor Presentation:

The Company’s supplemental financial reporting package as well as an updated investor presentation are available on the Company’s investor relations website at www.ir.psbusinessparks.com.

Earnings Release, Investor Conference Webcast and Conference Call:

The Company will host a webcast and conference call on Wednesday, February 23, 2022, at 10:00 a.m. PST (1:00 p.m. EST) to review fourth quarter results, discuss recent events and conduct a question-and-answer period. The live webcast will be available on the Company’s investor relations website at ir.psbusinessparks.com.

To Participate in the Telephone Conference Call:

Phone #: (866) 831-8713

Pass Code: PSBQ421

Conference Call Playback:

Phone #: (800) 925-9942

The playback can be accessed through March 2, 2022.

6

Company Information

PS Business Parks, Inc. (NYSE:PSB), a S&P MidCap 400 company, is a REIT that acquires, develops, owns, and operates commercial properties, predominantly multi-tenant industrial, industrial-flex, and low-rise suburban office space. Located primarily in major coastal markets, PS Business Parks’ 97 properties serve approximately 5,000 tenants in 28 million square feet of space as of December 31, 2021. The portfolio also includes 800 residential units (including units in-process).

Forward-Looking Statements

When used within this press release, the words “may,” “believes,” “anticipates,” “plans,” “expects,” “seeks,” “estimates,” “intends,” and similar expressions are intended to identify “forward-looking statements.” Such forward-looking statements involve known and unknown risks, uncertainties, and other factors, which may cause the actual results and performance of the Company to be materially different from those expressed or implied in the forward-looking statements, including but not limited to: (i) the duration and severity of the COVID-19 pandemic and its impact on our business and our customers; (ii) changes in general economic and business conditions, including as a result of the economic fallout of the COVID-19 pandemic; (iii) potential regulatory actions to close our facilities or limit our ability to evict delinquent customers; (iv) decreases in rental rates or increases in vacancy rates/failure to renew or replace expiring leases; (v) tenant defaults; (vi) the effect of the recent credit and financial market conditions; (vii) our failure to maintain our status as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”); (viii) the economic health of our customers; (ix) the health of our officers and directors; (x) increases in operating costs; (xi) casualties to our properties not covered by insurance; (xii) the availability and cost of capital; (xiii) increases in interest rates and its effect on our stock price; (xiv) security breaches, including ransomware, or a failure of our networks, systems or technology which could adversely impact our operations or our business, customer and employee relationships or result in fraudulent payments; (xv) the impact of inflation; and (xvi) other factors discussed in the Company’s SEC reports, including quarterly reports on Form 10-Q, reports on Form 8-K, and annual reports on Form 10-K.

Additional information about PS Business Parks, Inc., including more financial analysis of the fourth quarter operating results, is available on the Company’s website at psbusinessparks.com.

Definitions/Discussion of Non-GAAP Financial Measures:

Adjusted Cost of Operations: Adjusted cost of operations represents cost of operations, excluding non-cash stock compensation expense for employees whose compensation expense is recorded in cost of operations, which can vary significantly period to period based upon the performance of the Company. The GAAP measure most directly comparable to adjusted cost of operations is cost of operations.

Cash NOI: Cash NOI represents NOI adjusted to exclude non-cash items included in rental income and in cost of operations. The non-cash rental income includes amortization of deferred rent receivable (net of write-offs), in-place lease intangible, tenant improvement reimbursements, and lease incentives. The non-cash expense is equal to stock compensation expense for employees whose compensation expense is recorded in cost of operations. We believe that cash NOI assists investors in analyzing cash flow performance of our business parks. The GAAP measure most directly comparable to cash NOI is net income.

Cash NOI Margin: Cash NOI margin is computed by dividing Cash NOI by Cash Rental Income.

Cash Rental Income: Cash rental income represents rental income, excluding non-cash rental income, specifically amortization of deferred rent receivable (net of write-offs), in-place lease intangible, tenant improvement reimbursements, and lease incentives.

Cash Rental Income per Occupied Square Feet and Cash Rental Income per Available Square Foot: Computed by dividing Cash Rental Income for the period by weighted average occupied and available square feet for the same period. Cash rental income per occupied and available square foot for the three-month period shown is annualized.

Core Funds from Operations (Core FFO): We calculate Core FFO by adjusting FFO, as defined below, excluding the impact of (i) charges related to the redemption of preferred stock and (ii) other nonrecurring income or expense items as appropriate. Management believes that Core FFO is a useful supplemental measure as it provides a more meaningful and consistent comparison of operating performance and allows investors to more easily compare the Company’s operating results. Because certain of these adjustments have a real economic impact on our financial condition and results from operations, the utility of Core FFO as a measure of our performance is limited. Other REITs may not calculate Core FFO in a consistent manner. Accordingly, our Core FFO may not be comparable to other REITs’ Core FFO. Core FFO should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance.

7

Funds Available for Distribution (FAD): FAD is a non-GAAP measure that represents Core FFO adjusted to (a) deduct recurring capital improvements that maintains the condition of our real estate, tenant improvements and lease commissions and (b) remove certain non-cash rental income or expenses such as amortization of deferred rent receivable and non-cash stock compensation expense. We believe our presentation of FAD assists investors and analysts in analyzing and comparing our operating and financial performance between reporting periods. FAD is not a substitute for GAAP net cash flow in evaluating our liquidity or ability to pay dividends, because they exclude investing and financing activities presented on our statements of cash flows. The GAAP measure most directly comparable to FAD is operating cash flow from our statements of cash flows.

Funds from Operations (FFO): We calculate FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts (“NAREIT”). FFO represents net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from sales of depreciable operating property, gains (or losses) from sales of assets incidental to our business, impairment losses of depreciable operating property or assets incidental to our business, real estate related depreciation and amortization (excluding amortization of deferred financing costs and amortization of above/below-market lease intangibles) and after adjustments for unconsolidated joint ventures. Management uses FFO as a supplemental performance measure because, in excluding real estate related depreciation and amortization, gains and losses from property dispositions, other than temporary impairments of unconsolidated real estate entities, and impairment on our investment in real estate, it provides a performance measure that, when compared year over year, captures trends in occupancy rates, rental rates and operating costs. We also believe that, as a widely recognized measure of performance used by other REITs, FFO may be used by investors as a basis to compare our operating performance with that of other REITs. However, because FFO excludes depreciation and amortization and captures neither the changes in the value of our properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of our properties, all of which have real economic effects and could materially impact our results from operations, the utility of FFO as a measure of our performance is limited. Other equity REITs may not calculate or interpret FFO in accordance with the NAREIT definition as we do, and, accordingly, our FFO may not be comparable to such other REITs’ FFO. FFO should not be used as a measure of our liquidity and is not indicative of funds available for our cash needs, including our ability to pay dividends. FFO should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance. A reconciliation of net income, the nearest GAAP equivalent, to FFO is under the additional financial data section.

Net Operating Income (NOI): We utilize NOI, a non-GAAP financial measure, to evaluate the operating performance of our business parks. We define NOI as rental income less adjusted cost of operations (described above). We believe NOI assists investors in analyzing the performance and value of our business parks by excluding (i) corporate overhead (i.e. general and administrative expenses) because it does not relate to the results of our business parks, (ii) depreciation and amortization expense because it does not accurately reflect changes in the fair value of our business parks and (iii) non-cash stock compensation expense because this expense item can vary significantly from period to period and thus impact comparability across periods. The GAAP measure most directly comparable to NOI is net income.

NOI Margin: NOI margin is computed by dividing NOI by rental income.

Revenue Per Occupied Square Foot and Revenue per Available Square Foot (RevPAF): Computed by dividing rental income for the period by weighted average occupied and available square feet for the same period. Revenue per occupied square foot and RevPAF for the three month period shown is annualized.

Same Park Portfolio: The Company believes that evaluation of the Same Park portfolio, defined as all properties owned and operated as of December 31, 2021 that were acquired prior to January 1, 2019, provides an informative view of how the Company’s portfolio has performed over comparable periods. As of December 31, 2021, the Same Park portfolio consisted of 25.1 million rentable square feet, or 92.8% of the Company’s 27.0 million total rentable square feet, excluding the Company’s 95.0% interest in a 395-unit multifamily property and 702,000 square feet of assets held for sale.

Additional financial data attached.

8

PS BUSINESS PARKS, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

	December 31,
	2021			2020
ASSETS
Cash and cash equivalents	$	27,074		$	69,083
Real estate facilities, at cost
Land		867,345			843,765
Buildings and improvements		2,239,137			2,080,895
		3,106,482			2,924,660
Accumulated depreciation		(1,178,397	)		(1,101,739	)
		1,928,085			1,822,921
Properties held for sale, net		33,609			75,138
Land and building held for development, net		78,990			37,922
		2,040,684			1,935,981
Rent receivable		1,621			1,519
Deferred rent receivable		37,581			36,788
Other assets		16,262			14,334
Total assets	$	2,123,222		$	2,057,705
LIABILITIES AND EQUITY
Accrued and other liabilities	$	97,151		$	82,065
Credit facility		32,000			—
Total liabilities		129,151			82,065
Commitments and contingencies
Equity
PS Business Parks, Inc.’s stockholders’ equity
Preferred stock, $0.01 par value, 50,000,000 shares authorized, 30,200 and 37,790 shares issued and outstanding at December 31, 2021 and 2020, respectively		755,000			944,750
Common stock, $0.01 par value, 100,000,000 shares authorized, 27,589,807 and 27,488,547 shares issued and outstanding at December 31, 2021 and 2020, respectively		275			274
Paid-in capital		752,444			738,022
Accumulated earnings		226,737			73,631
Total PS Business Parks, Inc.’s stockholders’ equity		1,734,456			1,756,677
Noncontrolling interests		259,615			218,963
Total equity		1,994,071			1,975,640
Total liabilities and equity	$	2,123,222		$	2,057,705

9

PS BUSINESS PARKS, INC.

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts)

	For the Three Months Ended December 31,						For the Years Ended December 31,
	2021			2020			2021			2020
Rental income	$	110,844		$	105,088		$	438,703		$	415,623
Expenses
Cost of operations		32,738			32,023			130,896			125,513
Depreciation and amortization		24,130			23,668			93,486			96,314
General and administrative		4,728			3,152			19,057			14,526
Total operating expenses		61,596			58,843			243,439			236,353
Interest and other income		946			222			2,536			1,234
Interest and other expense		(3,943	)		(172	)		(4,646	)		(1,072	)
Gain on sale of real estate facilities		310,758			—			359,875			27,273
Net income		357,009			46,295			553,029			206,705
Allocation to noncontrolling interests		(70,915	)		(7,147	)		(104,270	)		(33,158	)
Net income allocable to PS Business Parks, Inc.		286,094			39,148			448,759			173,547
Allocation to preferred stockholders based upon Distributions		(10,485	)		(12,047	)		(46,624	)		(48,186	)
Preferred securities redemption charge		(6,434	)		—			(6,434	)		—
Allocation to restricted stock unit holders		(1,785	)		(173	)		(2,613	)		(716	)
Net income allocable to common stockholders	$	267,390		$	26,928		$	393,088		$	124,645
Net income per share of common stock
Basic	$	9.70		$	0.98		$	14.28		$	4.54
Diluted	$	9.66		$	0.98		$	14.22		$	4.52
Weighted average common stocks outstanding
Basic		27,565			27,488			27,534			27,475
Diluted		27,671			27,572			27,636			27,563

10

PS BUSINESS PARKS, INC.

Computation of FFO, Core FFO, and FAD

(In thousands, except per share amounts)

	For the Three Months Ended December 31,						For the Years Ended December 31,
	2021			2020			2021			2020
Net income allocable to common stockholders	$	267,390		$	26,928		$	393,088		$	124,645
Adjustments
Gain on sale of real estate facilities		(310,758	)		—			(359,875	)		(27,273	)
Depreciation and amortization expense		24,130			23,668			93,486			96,314
Net income allocated to noncontrolling interests		70,915			7,147			104,270			33,158
Net income allocated to restricted stock unit holders		1,785			173			2,613			716
FFO allocated to joint venture partner		(11	)		(16	)		(78	)		(118	)
FFO allocable to diluted common stock and units (1)		53,451			57,900			233,504			227,442
Maryland reincorporation costs		—			—			510			—
Non-capitalizable demolition costs		—			—			—			335
Acceleration of stock compensation expense due to President and Chief Executive Officer retirement		—			—			—			1,687
Preferred securities redemption charge		6,434			—			6,434			—
Income tax expense		3,600			—			3,600			—
Core FFO allocable to diluted common stock and units (1)		63,485			57,900			244,048			229,464
Adjustments
Recurring capital improvements		(3,299	)		(3,108	)		(11,649	)		(9,521	)
Tenant improvements		(3,512	)		(4,909	)		(14,767	)		(15,948	)
Capitalized lease commissions		(3,281	)		(3,653	)		(8,719	)		(8,878	)
Non-cash rental income (1)		(857	)		627			(2,800	)		(4,713	)
Non-cash stock compensation expense (2)		2,073			1,257			8,495			3,961
Cash paid for taxes in lieu of stock upon vesting of restricted stock units		(260	)		(114	)		(3,940	)		(4,216	)
FAD allocable to diluted common stock and units (1)	$	54,349		$	48,000		$	210,668		$	190,149
Distributions to common stockholders, noncontrolling interests, and restricted stock unit holders (3)	$	36,833		$	36,750		$	147,163		$	146,873
Distribution payout ratio		67.8%			76.6%			69.9%			77.2%
Reconciliation of Earnings per stock to FFO per share
Net income per common stock—diluted	$	9.66		$	0.98		$	14.22		$	4.52
Gain on sale of real estate facilities		(8.87	)		—			(10.29	)		(0.78	)
Net income allocated to restricted stock unit holders		0.05			0.01			0.07			0.02
Depreciation and amortization expense		0.69			0.67			2.67			2.75
FFO per share (1)	$	1.53		$	1.66		$	6.67		$	6.51
Maryland reincorporation costs		—			—			0.02			—
Non-capitalizable demolition costs		—			—			—			0.01
Acceleration of stock compensation expense due to President and Chief Executive Officer retirement		—			—			—			0.05
Preferred securities redemption charge		0.18			—			0.18			—
Income tax expense		0.10			—			0.10			—
Core FFO per share (1)	$	1.81		$	1.66		$	6.97		$	6.57
Weighted average outstanding:
Common stock		27,565			27,488			27,534			27,475
Operating partnership units		7,305			7,305			7,305			7,305
Restricted stock units		46			57			50			51
Common stock equivalents		106			84			102			88
Total diluted common stock and units		35,022			34,934			34,991			34,919

⁽¹⁾ Defined in Definitions/Non-GAAP Discussion

⁽²⁾ Amounts shown are net of accelerated stock compensation expense related to the former President and Chief Executive Officer retirement, which is also excluded from the computation of Core FFO.

⁽³⁾ Excludes special dividend distribution to common stockholders, noncontrolling interests and restricted stock unit holders.

11

PS BUSINESS PARKS, INC.

Reconciliation of Selected Non-GAAP Measures to Analogous GAAP Measures

(In thousands)

	For the Three Months Ended December 31,											For the Years Ended December 31,
	2021			2020			$ Change			% Change		2021			2020			$ Change			% Change
Rental income
Same Park (1)	$	100,420		$	93,607		$	6,813			7.3%	$	392,221		$	369,448		$	22,773			6.2%
Non-Same Park		5,664			3,126			2,538			81.2%		17,829			9,311			8,518			91.5%
Multifamily		2,186			2,215			(29	)		(1.3%)		9,069			9,464			(395	)		(4.2%)
Assets sold or held for sale (2)		2,574			6,140			(3,566	)		(58.1%)		19,584			27,400			(7,816	)		(28.5%)
Total rental income		110,844			105,088			5,756			5.5%		438,703			415,623			23,080			5.6%
Cost of operations
Adjusted Cost of Operations (1)
Same Park		28,185			27,115			1,070			3.9%		111,333			106,860			4,473			4.2%
Non-Same Park		1,794			1,054			740			70.2%		5,523			3,661			1,862			50.9%
Multifamily		1,242			1,180			62			5.3%		4,647			4,264			383			9.0%
Assets sold or held for sale (2)		1,125			2,247			(1,122	)		(49.9%)		7,636			9,518			(1,882	)		(19.8%)
Stock compensation expense (3)		392			427			(35	)		(8.2%)		1,757			1,210			547			45.2%
Total cost of operations		32,738			32,023			715			2.2%		130,896			125,513			5,383			4.3%
Net operating income (2)
Same Park		72,235			66,492			5,743			8.6%		280,888			262,588			18,300			7.0%
Non-Same Park		3,870			2,072			1,798			86.8%		12,306			5,650			6,656			117.8%
Multifamily		944			1,035			(91	)		(8.8%)		4,422			5,200			(778	)		(15.0%)
Assets sold or held for sale (2)		1,449			3,893			(2,444	)		(62.8%)		11,948			17,882			(5,934	)		(33.2%)
Stock compensation expense (3)		(392	)		(427	)		35			(8.2%)		(1,757	)		(1,210	)		(547	)		45.2%
Depreciation and amortization expense		(24,130	)		(23,668	)		(462	)		2.0%		(93,486	)		(96,314	)		2,828			(2.9%)
General and administrative expense		(4,728	)		(3,152	)		(1,576	)		50.0%		(19,057	)		(14,526	)		(4,531	)		31.2%
Interest and other income		946			222			724			326.1%		2,536			1,234			1,302			105.5%
Interest and other expense		(3,943	)		(172	)		(3,771	)		2192.4%		(4,646	)		(1,072	)		(3,574	)		333.4%
Gain on sale of real estate facilities		310,758			—			310,758			100.0%		359,875			27,273			332,602			1219.5%
Net income	$	357,009		$	46,295		$	310,714			671.2%	$	553,029		$	206,705		$	346,324			167.5%

⁽¹⁾ Defined in Definitions/Non-GAAP Discussion.

⁽²⁾ As of December 31, 2021 and 2020, the Company had reclassified to properties held for sale a 702,000 square foot industrial-flex business park located in Irving, Texas. Also included in the respective periods are assets sold in 2021 and 2020:

● 198,000 square foot office-oriented flex business park located in Chantilly, Virginia, sold in June 2021;

● 244,000 square foot office park located in Herndon, Virginia, sold in July 2021;

● 22,000 square foot industrial-flex building located in Irving, Texas, sold in September 2021;

● 371,000 square foot industrial-flex business park located in San Diego, California, sold in October 2021;

● 53,000 square foot industrial building located in Beltsville, Maryland, sold in December 2021;

● 70,000 square foot industrial-flex building located in Irving, Texas, sold in December 2021;

● 113,000 square feet sold in January 2020, and

● 40,000 square feet sold in September 2020.

⁽³⁾ Stock compensation expense, as shown here, represents stock compensation expense for employees whose compensation expense is recorded in cost of operations. Note that stock compensation expense attributable to the executive management team (including divisional vice presidents) and other corporate employees is recorded within general and administrative expense.

12

EX-99.2

Exhibit 99.2

Table of Contents

Section	Page
Corporate Data:
Investor Company Summary		3
Company Overview		4
Financial and Portfolio Highlights and Capitalization Data		5
Consolidated Financial Results:
Consolidated Balance Sheets		6
Consolidated Statements of Operations		8
Non-GAAP Funds from Operations (FFO) and Core FFO Reconciliations		11
Non-GAAP FFO, Core FFO and Funds Available for Distribution (FAD) Reconciliations		12
Net Operating Income (NOI), Cash NOI and EBITDAre		13
Same Park Cash NOI by Region and Type		14
Capitalization Summary		16
Analysis of Capital Expenditures		17
Portfolio Data:
Portfolio Summary		18
Portfolio Overview by Product Type		19
Fourth Quarter- and Year-to-Date Production Statistics		21
Lease Expirations		23
Industry Concentration and Top Ten Customers		26
Definitions and Non-GAAP Disclosures		27

Forward-Looking Statements

When used within this supplemental information package, the words “may,” “believes,” “anticipates,” “plans,” “expects,” “seeks,” “estimates,” “intends,” and similar expressions are intended to identify “forward-looking statements.” Such forward-looking statements involve known and unknown risks, uncertainties, and other factors, which may cause the actual results and performance of the Company to be materially different from those expressed or implied in the forward-looking statements, including but not limited to: (i) the duration and severity of the COVID-19 pandemic and its impact on our business and our customers; (ii) changes in general economic and business conditions, including as a result of the economic fallout of the COVID-19 pandemic; (iii) potential regulatory actions to close our facilities or limit our ability to evict delinquent customers; (iv) decreases in rental rates or increases in vacancy rates/failure to renew or replace expiring leases; (v) tenant defaults; (vi) the effect of the recent credit and financial market conditions; (vii) our failure to maintain our status as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”); (viii) the economic health of our customers; (ix) the health of our officers and directors; (x) increases in operating costs; (xi) casualties to our properties not covered by insurance; (xii) the availability and cost of capital; (xiii) increases in interest rates and its effect on our stock price; (xiv) security breaches, including ransomware, or a failure of our networks, systems or technology which could adversely impact our operations or our business, customer and employee relationships or result in fraudulent payments; (xv) the impact of inflation; and (xvi) other factors discussed in the Company’s SEC reports, including quarterly reports on Form 10-Q, reports on Form 8-K, and annual reports on Form 10-K.

Fourth Quarter 2021 Supplemental Financial Reporting Package    2

  Investor Company Summary

Executive Management Team
	Stephen W. Wilson	Interim President and Chief Executive Officer
	Maria R. Hawthorne	Interim Chief Operating Officer
	Dan M. Chandler III	President and Chief Executive Officer (On leave)
	Adeel Khan	Chief Financial Officer and Corporate Secretary
	Trenton Groves	SVP, Chief Accounting Officer
Board of Directors
	Ronald L. Havner, Jr.	Chairman of the Board
	Stephen W. Wilson	Director, Interim President and Chief Executive Officer
	Maria R. Hawthorne	Director, Interim Chief Operating Officer
	Dan M. Chandler III	President and Chief Executive Officer (On leave)
	Jennifer Holden Dunbar	Director
	M. Christian Mitchell	Director
	Irene H. Oh	Director
	Kristy M. Pipes	Director
	Gary E. Pruitt	Director
	Robert S. Rollo	Director
	Joseph D. Russell, Jr.	Director
	Peter Schultz	Director
Investor Relations Information

Adeel Khan
T: 818.244.8080, Ext. 8975
akhan@psbusinessparks.com
Equity Research Coverage
	FIRM	ANALYST	PHONE	EMAIL
	Citi	Manny Korchman	212-816-1382	emmanuel.korchman@citi.com
	Green Street Advisors	Vince Tibone	949-640-8780	vtibone@greenstreetadvisors.com
	JP Morgan	Anthony Paolone	212-622-6682	anthony.paolone@jpmorgan.com
	KeyBanc	Craig Mailman	917-368-2316	cmailman@key.com
	Wells Fargo	Blaine Heck	443-263-6529	blaine.heck@wellsfargo.com

PS Business Parks, Inc. is followed by the analysts listed above. Please note that any opinions, estimates or forecasts regarding PS Business Parks, Inc.’s performance made by these analysts are theirs alone and do not represent opinions, forecasts or predictions of PS Business Parks, Inc. or its management. PS Business Parks, Inc. does not by its reference above or distribution imply its endorsement of or concurrence with such information, conclusions or recommendations.

Fourth Quarter 2021 Supplemental Financial Reporting Package    3

  Company Overview As Of December 31, 2021

TOTAL NUMBER OF PROPERTIES 97 TOTAL RENTABLE SQUARE FEET 27,712,000 SF TOTAL RENTABLE SQUARE FEET EXCLUDING ASSETS HELD FOR SALE 27,010,000 SF TOTAL PORTFOLIO OCCUPANCY 95.9% SAME PARK PORTFOLIO OCCUPANCY 96.4% 2021 SAME PROPERTY PORTFOLIO NOI GROUTH 7.0% 2021 SAME PROPERTY PORTFOLIO CASH NOI GROUTH 8.0% 2021 COMPANY SHARE OF CORE FFO PER SAHRE GROUTH 6.1% CREDIT RATINGS (S&P)/MOODY’S) A-,BBB/Baa2 NET DEBT TO TOTAL COMBINED MARKET CAPITALIZATION 0.1% NET DEBT & PREFERRED EQUITY TO TOTAL COMBINED MARKET CAPITALIZATION 10.6% NET DEBT TO ADJUSTED EBITDAre 2.6x SEATTLE SQUARE FEET: 1.4M% OF FY2021 NOI: 5.1% NORTHERN CALIFORNIA SQUARE FEET: 7.3M % OF FY2021 NOI: 30.8% SOUTHERN CALIFORNIA SQUARE FEET: 3.6M % OF FY2021 NOI: 15.6% AUSTIN SQUARE FEET: 2.0M % OF FY2021 NOI: 7.1% DALLAS SQUARE FEET: 3.6M % OF FY2021 NOI: 7.2% NORTHERN VIRGINIA SQUARE FEET: 4.8M % OF FY2021 NOI: 18.0% MARYLAND SQUARE FEET: 1.1M % OF FY2021 NOI: 4.2% FLORIDA SQUARE FEET: 3.9M%OF FY2021 NOI: 12.0% 89.6% OF SQUARE FEET FROM INDUSTRIAL-FLEX SPACE

Fourth Quarter 2021 Supplemental Financial Reporting Package    4

  Financial and Portfolio Highlights and Capitalization Data (unaudited, in thousands except share and per share data and portfolio  statistics)

	Three Months Ended
	December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021			December 31, 2020
Financial Results:
Rental income	$	110,844		$	110,448		$	109,364		$	108,047		$	105,088
Net income	$	357,009		$	78,463		$	70,050		$	47,507		$	46,295
Net Operating Income (NOI) (1)	$	78,498		$	77,785		$	77,996		$	75,285		$	73,492
Cash NOI (1)	$	77,641		$	77,332		$	77,813		$	73,978		$	74,119
Core FFO (1)	$	63,485		$	60,328		$	61,816		$	58,419		$	57,900
Core FFO per common stock – diluted (1)	$	1.81		$	1.72		$	1.77		$	1.67		$	1.66
EBITDAre	$	74,224		$	72,599		$	73,503		$	70,624		$	70,096
Dividend declared per share of common stock	$	1.05		$	1.05		$	1.05		$	1.05		$	1.05
Portfolio Statistics:
Total rentable square footage at period end (2)		27,010,000			26,869,000			26,151,000			26,151,000			26,068,000
Weighted average occupancy		95.5%			94.7%			93.8%			93.2%			92.4%
Period end Occupancy		95.9%			95.5%			94.5%			93.6%			93.7%
Rent Change - Cash		6.1%			5.0%			3.1%			6.4%			4.0%
Rent Change - Net Effective		16.4%			15.4%			10.7%			16.4%			13.1%
Same Park Performance:
Same Park Portfolio weighted average occupancy		95.7%			94.8%			93.9%			93.2%			92.7%
Same Park Portfolio NOI growth (3)		8.6%			8.5%			10.5%			0.5%			-1.5%
Same Park Portfolio Cash NOI growth (1) (3)		6.5%			10.7%			14.7%			0.8%			0.8%
Capitalization:
Total shares and units issued and outstanding at period end (4)		34,895,162			34,851,508			34,846,819			34,822,294			34,793,902
Total equity market capitalization	$	6,426,642		$	5,462,625		$	5,160,177		$	5,382,830		$	4,623,066
Series W, X, Y and Z Preferred Stock(5)	$	755,000		$	944,750		$	944,750		$	944,750		$	944,750
Total consolidated debt	$	32,000		$	—		$	—		$	—		$	—
Unrestricted cash	$	(27,074	)	$	(46,594	)	$	(115,965	)	$	(69,492	)	$	(69,083)
Total combined market capitalization (net debt plus equity)	$	7,186,568		$	6,360,781		$	5,988,902		$	6,258,088		$	5,498,733
Ratios:
Net debt & preferred equity to total combined market capitalization		10.6%			14.1%			13.8%			14.0%			15.9%
Net debt to total combined market capitalization		0.1%			n/a			n/a			n/a			n/a
Ratio of EBITDAre to fixed charges and preferred distributions (6)		6.9x			5.9x			6.0x			5.8x			5.8x
Net debt and preferred equity to EBITDAre (7)		2.6x			3.1x			2.8x			3.1x			3.1x

(1) For definition/discussion of non-GAAP financial measures and reconciliations to their nearest GAAP equivalents, see the definitions section & reconciliation section beginning on page 27 and page 11 of this report, respectively.

(2) Excludes assets sold or held for sale

(3) Represents the quarter over quarter percentage change in NOI and Cash NOI for the Same Park Portfolio.

(4) Total shares and units issued and outstanding at period end is comprised of common stock and common operating partnership units.

(5) Series W Preferred Stock redeemed in November 2021.

(6) For each period shown, ratio of total fixed charges to EBITDAre is calculated using the respective quarter’s annualized fixed charges divided by the respective quarter’s annualized EBITDAre.

(7) For each period shown, ratio of debt and preferred equity to EBITDAre is calculated using total net debt and preferred equity reported during the quarter divided by the respective quarter’s annualized EBITDAre.

Fourth Quarter 2021 Supplemental Financial Reporting Package    5

  Consolidated Balance Sheets (unaudited, in thousands)

	December 31, 2021			December 31, 2020
ASSETS
Cash and cash equivalents	$	27,074		$	69,083	(a)
Real estate facilities, at cost
Land		867,345			843,765
Buildings and improvements		2,239,137			2,080,895
		3,106,482			2,924,660
Accumulated depreciation		(1,178,397	)		(1,101,739	)
		1,928,085			1,822,921	(b)
Properties held for sale, net (1)		33,609			75,138
Land and building held for development, net		78,990			37,922
		2,040,684			1,935,981
Rent receivable		1,621			1,519	(c)
Deferred rent receivable		37,581			36,788
Other assets		16,262			14,334	(d)
Total assets	$	2,123,222		$	2,057,705
LIABILITIES AND EQUITY
Accrued and other liabilities	$	97,151		$	82,065	(e)
Credit facility		32,000			—
Total liabilities		129,151			82,065
Equity
PS Business Parks, Inc.’s stockholders’ equity:
Preferred stock		755,000			944,750
Common stock		275			274
Paid-in capital		752,444			738,022	(f)
Accumulated earnings		226,737			73,631	(g)
Total PS Business Parks, Inc.’s stockholders’ equity		1,734,456			1,756,677
Noncontrolling interests		259,615			218,963
Total equity		1,994,071			1,975,640
Total liabilities and equity	$	2,123,222		$	2,057,705

See following page for additional detail related to the tickmarks shown in the table above.

⁽¹⁾ As of December 31, 2021 and 2020, respectively, the Company had reclassified to properties held for sale (“AHFS”) a total of 702,000 square feet in both periods. See Definitions and Non-GAAP Disclosures for listing of assets classified as AHFS and Assets Sold in 2021 and 2020.

Fourth Quarter 2021 Supplemental Financial Reporting Package    6

  Consolidated Balance Sheets Variance Detail (in thousands)

(a)	Change in cash and cash equivalents
	Beginning cash balance at December 31, 2020					$	69,083
	Net cash provided by operating activities						302,237
	Net cash provided by investing activities						169,366
	Net cash used in financing activities						(513,612)
	Ending cash balance at December 31, 2021					$	27,074
(b)	Change in real estate facilities, at cost
	Beginning balance at December 31, 2020					$	1,822,921
	Acquisition of real estate						146,302
	Recurring capital improvements						11,649
	Tenant improvements, gross						14,903
	Capitalized lease commissions						8,719
	Nonrecurring capital improvements						2,705
	Depreciation and amortization of real estate facilities						(90,175)
	Transfer from land and building held for development, net						9,052
	Transfer to properties held for sale, net						2,009
	Ending balance at December 31, 2021					$	1,928,085
(c)	Change in rent receivable	December 31, 2021		December 31, 2020		Increase (Decrease)
	Non-government customers	$	1,186	$	646	$	540
	U.S. Government customers		435		873		(438)
		$	1,621	$	1,519	$	102
(d)	Change in other assets	December 31, 2021		December 31, 2020		Increase (Decrease)
	Lease intangible assets, net	$	8,555	$	9,058	$	(503)
	Prepaid property taxes and insurance		3,439		3,121		318
	Other		4,268		2,155		2,113
		$	16,262	$	14,334	$	1,928
(e)	Change in accrued and other liabilities	December 31, 2021		December 31, 2020		Increase (Decrease)
	Customer security deposits	$	42,027	$	38,457	$	3,570
	Accrued property taxes		13,289		12,513		776
	Customer prepaid rent		14,232		12,518		1,714
	Lease intangible liabilities, net		6,330		6,392		(62)
	Accrued tax liability		3,600		—		3,600
	Other		17,673		12,185		5,488
		$	97,151	$	82,065	$	15,086
(f)	Change in paid-in capital
	Beginning paid-in capital at December 31, 2020					$	738,022
	Charge related to the redemption of preferred securities						6,434
	Issuance costs						(105)
	Exercise of stock options						5,011
	Stock compensation expense, net						7,022
	Cash paid for taxes in lieu of stock upon vesting of restricted stock units						(3,940)
	Ending paid-in capital at December 31, 2021					$	752,444
(g)	Change in accumulated earnings
	Beginning accumulated earnings at December 31, 2020					$	73,631
	Net income						448,759
	Charge related to the redemption of preferred securities						(6,434)
	Distributions to preferred stockholders						(46,624)
	Distributions to common stockholders						(242,595)
	Ending accumulated earnings at December 31, 2021					$	226,737

Fourth Quarter 2021 Supplemental Financial Reporting Package    7

  Consolidated Statements of Operations (unaudited and in thousands, except per share data)

	Three Months Ended
	December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021			December 31, 2020
Rental income	$	110,844		$	110,448		$	109,364		$	108,047		$	105,088
Expenses:
Cost of operations		32,738			33,091			31,849			33,218			32,023
Depreciation and amortization		24,130			23,857			22,514			22,985			23,668
General and administrative		4,728			5,148			4,799			4,382			3,152
Total operating expenses		61,596			62,096			59,162			60,585			58,843
Interest and other income		946			411			923			256			222
Interest and other expense (1)		(3,943	)		(224	)		(268	)		(211	)		(172	)
Gain on sale of real estate facilities		310,758			29,924			19,193			—			—
Net income		357,009			78,463			70,050			47,507			46,295
Allocation to noncontrolling interests		(70,915	)		(13,850	)		(12,094	)		(7,411	)		(7,147	)
Net income allocable to PS Business Parks, Inc.		286,094			64,613			57,956			40,096			39,148
Allocation to preferred stockholders		(10,485	)		(12,046	)		(12,047	)		(12,046	)		(12,047	)
Preferred securities redemption charge		(6,434	)		—			—			—			—
Allocation to restricted stock unit holders		(1,785	)		(350	)		(314	)		(164	)		(173	)
Net income allocable to common stockholders	$	267,390		$	52,217		$	45,595		$	27,886		$	26,928
Net income per share of common stock
Basic	$	9.70		$	1.90		$	1.66		$	1.01		$	0.98
Diluted	$	9.66		$	1.89		$	1.65		$	1.01		$	0.98
Weighted average common stock outstanding
Basic		27,565			27,543			27,531			27,495			27,488
Diluted		27,671			27,635			27,632			27,594			27,572

⁽¹⁾ Other expense includes $3.6 million related to state tax provision in the fourth quarter of 2021.

Fourth Quarter 2021 Supplemental Financial Reporting Package    8

  Consolidated Statements of Operations, Quarterly & Yearly (continued) (unaudited and in thousands, except per share data)

	For the Three Months Ended						For the Years Ended
	December 31,						December 31,
	2021			2020			2021			2020
Rental income	$	110,844		$	105,088		$	438,703		$	415,623		(a	)
Expenses:
Cost of operations		32,738			32,023			130,896			125,513		(b	)
Depreciation and amortization		24,130			23,668			93,486			96,314
General and administrative		4,728			3,152			19,057			14,526		(c	)
Total operating expenses		61,596			58,843			243,439			236,353
Interest and other income		946			222			2,536			1,234		(d	)
Interest and other expense		(3,943	)		(172	)		(4,646	)		(1,072	)	(e	)
Gain on sale of real estate facilities		310,758			—			359,875			27,273
Net income		357,009			46,295			553,029			206,705
Allocation to noncontrolling interests		(70,915	)		(7,147	)		(104,270	)		(33,158	)
Net income allocable to PS Business Parks, Inc.		286,094			39,148			448,759			173,547
Allocation to preferred stockholders		(10,485	)		(12,047	)		(46,624	)		(48,186	)
Preferred securities redemption charge		(6,434	)		—			(6,434	)		—
Allocation to restricted stock unit holders		(1,785	)		(173	)		(2,613	)		(716	)
Net income allocable to common stockholders	$	267,390		$	26,928		$	393,088		$	124,645
Net income per share of common stock
Basic	$	9.70		$	0.98		$	14.28		$	4.54
Diluted	$	9.66		$	0.98		$	14.22		$	4.52
Weighted average common stock outstanding
Basic		27,565			27,488			27,534			27,475
Diluted		27,671			27,572			27,636			27,563

See following page for additional detail related to the tickmarks shown in the table above.

Fourth Quarter 2021 Supplemental Financial Reporting Package    9

  Consolidated Statements of Operations, Quarterly & Yearly (continued) (unaudited and in thousands)

		For the Three Months Ended									For the Years Ended
		December 31,						Increase			December 31,						Increase
(a)	Rental income:	2021			2020			(Decrease)			2021			2020			(Decrease)
	Same Park (1) (2)	$	100,006		$	94,566		$	5,440		$	391,125		$	365,881		$	25,244
	Same Park non-cash rental income (1) (3)		414			(959	)		1,373			1,096			3,567			(2,471	)
	Non-Same Park (1) (2)		5,329			2,494			2,835			16,139			8,252			7,887
	Non-Same Park non-cash rental income (1) (3)		335			632			(297	)		1,690			1,059			631
	Multifamily		2,186			2,215			(29	)		9,069			9,464			(395	)
	Rental income from assets sold or held for sale (4)		2,574			6,140			(3,566	)		19,584			27,400			(7,816	)
		$	110,844		$	105,088		$	5,756		$	438,703		$	415,623		$	23,080
(b)	Cost of operations:
	Same Park (1)	$	28,185		$	27,115		$	1,070		$	111,333		$	106,860		$	4,473
	Same Park non-cash expense (1) (5)		356			391			(35	)		1,597			1,103			494
	Non-Same Park (1)		1,794			1,054			740			5,523			3,661			1,862
	Non-Same Park non-cash expense (1) (5)		23			11			12			65			29			36
	Multifamily		1,242			1,180			62			4,647			4,264			383
	Operating expenses from assets sold or held for sale (4)		1,138			2,272			(1,134	)		7,731			9,596			(1,865	)
		$	32,738		$	32,023		$	715		$	130,896		$	125,513		$	5,383
(c)	General and administrative expenses:
	Compensation expense	$	1,752		$	880		$	872		$	6,787		$	5,488		$	1,299
	Stock compensation expense		1,681			830			851			6,738			4,438			2,300
	Professional fees and other		1,295			1,442			(147	)		5,532			4,600			932
		$	4,728		$	3,152		$	1,576		$	19,057		$	14,526		$	4,531
(d)	Interest and other income:
	Management fee income	$	59		$	64		$	(5	)	$	258		$	262		$	(4	)
	Interest income		7			5			2			18			370			(352	)
	Other income		880			153			727			2,260			602			1,658
		$	946		$	222		$	724		$	2,536		$	1,234		$	1,302
(e)	Interest and other expense:
	Interest expense and credit facility fee (6)	$	(100	)	$	(80	)	$	(20	)	$	(346	)	$	(318	)	$	(28	)
	Amortization of credit facility origination costs		(150	)		(58	)		(92	)		(382	)		(230	)		(152	)
	Other expense (7)		(3,693	)		(34	)		(3,659	)		(3,918	)		(524	)		(3,394	)
		$	(3,943	)	$	(172	)	$	(3,771	)	$	(4,646	)	$	(1,072	)	$	(3,574	)

⁽¹⁾ Refer to page 27, Definitions and Non-GAAP Disclosures, for the definitions of Same Park and Non-Same Park.

⁽²⁾ Same Park rental income is presented net of (a) accounts receivable write-offs of $0.1 million and $0.2 million for the three months ended December 31, 2021 and 2020, respectively, and $0.0 million and $1.5 million for the years ended December 31, 2021 and 2020, respectively, and (b) rent deferrals and abatements of $0.0 million and $0.2 million for the three months ended December 31, 2021 and 2020, respectively, and $0.6 million and $6.5 million for the years ended December 31, 2021 and 2020, respectively. Non-Same Park rental income is presented net of (a) accounts receivable write-offs of $0.0 million for each of the three months and years ended December 31, 2021 and 2020, and (b) rent deferrals and abatements of $0.0 million for each of the three months ended December 31, 2021 and 2020, and $0.2 million and $0.0 million for the years ended December 31, 2021 and 2020, respectively.

⁽³⁾ Non-cash rental income represents amortization of deferred rent receivable, amortization of above and below market rents, net, and amortization of lease incentives and tenant improvement reimbursements. Same Park non-cash rental income is presented net of deferred rent receivable write-offs of $0.1 million and $0.4 million for the three months ended December 31, 2021 and 2020, respectively, and $0.3 million and $3.0 million for the years ended December 31, 2021 and 2020, respectively. Non-Same Park non-cash rental income is presented net of deferred rent receivable write-offs of $0 million for each of the three months and years ended December 31, 2021 and 2020.

⁽⁴⁾ Amounts shown for the year ended December 31, 2021 and 2020 include operating results attributable the Assets Sold in 2021 and Assets Sold in 2020, respectively. Refer to page 27, Definitions and Non-GAAP Disclosures, for the definitions of Assets Sold in 2021 and Assets Sold 2020.

⁽⁵⁾ Non-cash expense represents stock compensation expense attributable to employees whose compensation expense is recorded in costs of operations.

⁽⁶⁾ Interest expense was $0.0 million for each of the three months and years ended December 31, 2021 and 2020.

⁽⁷⁾ Other expense includes $3.6 million related to state tax provision in the fourth quarter of 2021.

Fourth Quarter 2021 Supplemental Financial Reporting Package    10

  Non-GAAP Funds From Operations (FFO) and Core FFO Reconciliations (unaudited and in thousands, except per share amounts)

	Three Months Ended
	December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021			December 31, 2020
Net income allocable to common stockholders	$	267,390		$	52,217		$	45,595		$	27,886		$	26,928
Adjustments
Gain on sale of real estate facilities		(310,758	)		(29,924	)		(19,193	)		—			—
Depreciation and amortization		24,130			23,857			22,514			22,985			23,668
Net income allocable to noncontrolling interests		70,915			13,850			12,094			7,411			7,147
Net income allocable to restricted stock unit holders		1,785			350			314			164			173
FFO allocated to joint venture partner		(11	)		(22	)		(18	)		(27	)		(16	)
FFO allocable to diluted common stock and units (1)		53,451			60,328			61,306			58,419			57,900
Maryland reincorporation costs		—			—			510			—			—
Preferred securities redemption charge		6,434			—			—			—			—
Income tax expense		3,600			—			—			—			—
Core FFO allocable to diluted common stock and units (1)	$	63,485		$	60,328		$	61,816		$	58,419		$	57,900
Weighted average outstanding
Common stock		27,565			27,543			27,531			27,495			27,488
Operating partnership units		7,305			7,305			7,305			7,305			7,305
Restricted stock units		46			33			32			47			57
Common stock equivalents		106			92			101			99			84
Total diluted common stock and units		35,022			34,973			34,969			34,946			34,934
FFO per share	$	1.53		$	1.72		$	1.75		$	1.67		$	1.66
Core FFO per share	$	1.81		$	1.72		$	1.77		$	1.67		$	1.66

Fourth Quarter 2021 Supplemental Financial Reporting Package    11

  Non-GAAP FFO, Core FFO and Funds Available for Distribution (FAD) Reconciliations (unaudited and in thousands, except per share amounts)

	For the Three Months Ended						For the Years Ended
	December 31,						December 31,
	2021			2020			2021			2020
Net income allocable to common stockholders	$	267,390		$	26,928		$	393,088		$	124,645
Adjustments
Gain on sale of real estate facilities		(310,758	)		—			(359,875	)		(27,273	)
Depreciation and amortization		24,130			23,668			93,486			96,314
Net income allocable to noncontrolling interests		70,915			7,147			104,270			33,158
Net income allocable to restricted stock unit holders		1,785			173			2,613			716
FFO allocated to joint venture partner		(11	)		(16	)		(78	)		(118	)
FFO allocable to diluted common stock and units (1)		53,451			57,900			233,504			227,442
Maryland reincorporation costs		—			—			510			—
Non-capitalizable demolition costs		—			—			—			335
Acceleration of stock compensation expense due to President and Chief Executive Officer retirement		—			—			—			1,687
Preferred securities redemption charge		6,434			—			6,434			—
Income tax expense		3,600			—			3,600			—
Core FFO allocable to diluted common stock and units (1)		63,485			57,900			244,048			229,464
Adjustments
Recurring capital improvements		(3,233	)		(2,880	)		(11,335	)		(8,306	)
Tenant improvements		(3,462	)		(4,725	)		(13,680	)		(13,972	)
Capitalized lease commissions		(3,274	)		(3,459	)		(8,492	)		(8,153	)
Total recurring capital expenditures for assets sold or held for sale		(117	)		(582	)		(1,615	)		(3,892	)
Total multifamily capital expenditures		(6	)		(24	)		(13	)		(24	)
Non-cash rental income (2)		(857	)		627			(2,800	)		(4,713	)
Non-cash stock compensation expense (3)		2,073			1,257			8,495			3,961
Cash paid for taxes in lieu of stock upon vesting of restricted stock units		(260	)		(114	)		(3,940	)		(4,216	)
FAD allocable to diluted common stock and units (1)		54,349			48,000			210,668			190,149
Distributions to common stockholders (4)		(28,969	)		(28,863	)		(115,682	)		(115,396	)
Distributions to noncontrolling interests - common units (4)		(7,671	)		(7,671	)		(30,683	)		(30,683	)
Distributions to restricted stock unit holders (4)		(176	)		(185	)		(721	)		(654	)
Distributions to noncontrolling interests - joint venture		(17	)		(31	)		(77	)		(140	)
Free cash available after fixed charges		17,516			11,250			63,505			43,276
Non-recurring property renovations (1)		(1,686	)		(1,203	)		(2,705	)		(1,715	)
Investment in multifamily development		(12,903	)		(4,504	)		(43,443	)		(9,598	)
Investment in industrial development		(1,223	)		(1,306	)		(2,604	)		(7,149	)
Retained cash (1)	$	1,704		$	4,237		$	14,753		$	24,814
Weighted average outstanding
Common stock		27,565			27,488			27,534			27,475
Operating partnership units		7,305			7,305			7,305			7,305
Restricted stock units		46			57			50			51
Common stock equivalents		106			84			102			88
Total diluted common stock and units		35,022			34,934			34,991			34,919
FFO per share	$	1.53		$	1.66		$	6.67		$	6.51
Core FFO per share	$	1.81		$	1.66		$	6.97		$	6.57
FAD distribution payout ratio (5)		67.8	%		76.6	%		69.9	%		77.2	%

(1) Refer to page 27, Definitions and Non-GAAP Disclosures, for the definition of FFO, Core FFO, FAD, Non-Recurring Property Renovations and Retained Cash.

(2) Non-cash rental income includes amortization of deferred rent receivable (net of write-offs), in-place lease intangible, tenant improvement reimbursements, and lease incentives.

(3) Amounts shown are net of accelerated stock compensation expense related to the former President and Chief Executive Officer retirement, which is also excluded from the computation of Core FFO.

(4) Excludes special dividend distribution to common stockholders, noncontrolling interest and restricted stock unit holders.

(5) FAD distribution payout ratio is equal to total distributions to common stockholders, unit holders, restricted stock unit holders and our joint venture partner divided by FAD during the same reporting period.

Fourth Quarter 2021 Supplemental Financial Reporting Package    12

  Net Operating Income (NOI), Cash NOI and EBITDAre (unaudited, in thousands)

NET OPERATING INCOME													CASH NET OPERATING INCOME
	For the Three Months Ended						For the Years Ended							For the Three Months Ended						For the Years Ended
	December 31,						December 31,							December 31,						December 31,
	2021		2020		% Change		2021		2020		% Change			2021		2020		% Change		2021		2020		% Change
Rental income													Cash rental income (1) (5)
Same Park (1) (2) (3)	$	100,420	$	93,607		7.3%	$	392,221	$	369,448		6.2%	Same Park (1) (2) (4)	$	100,006	$	94,566		5.8%	$	391,125	$	365,881		6.9%
Non-Same Park (1)		5,664		3,126		81.2%		17,829		9,311		91.5%	Non-Same Park (1)		5,329		2,494		113.7%		16,139		8,252		95.6%
Multifamily		2,186		2,215		(1.3%)		9,069		9,464		(4.2%)	Multifamily		2,186		2,247		(2.7%)		9,069		9,492		(4.5%)
Assets sold or held for sale		2,574		6,140		(58.1%)		19,584		27,400		(28.5%)	Assets sold or held for sale		2,466		6,408		(61.5%)		19,570		27,285		(28.3%)
Total rental income		110,844		105,088		5.5%		438,703		415,623		5.6%	Total cash rental income		109,987		105,715		4.0%		435,903		410,910		6.1%
Adjusted cost of operations (1) (5)													Adjusted cost of operations (1) (5)
Same Park (1)		28,185		27,115		3.9%		111,333		106,860		4.2%	Same Park (1)		28,185		27,115		3.9%		111,333		106,860		4.2%
Non-Same Park (1)		1,794		1,054		70.2%		5,523		3,661		50.9%	Non-Same Park (1)		1,794		1,054		70.2%		5,523		3,661		50.9%
Multifamily		1,242		1,180		5.3%		4,647		4,264		9.0%	Multifamily		1,242		1,180		5.3%		4,647		4,264		9.0%
Assets sold or held for sale		1,125		2,247		(49.9%)		7,636		9,518		(19.8%)	Assets sold or held for sale		1,125		2,247		(49.9%)		7,636		9,518		(19.8%)
Total adjusted cost of operations		32,346		31,596		2.4%		129,139		124,303		3.9%	Total adjusted cost of operations		32,346		31,596		2.4%		129,139		124,303		3.9%
Net operating income													Cash net operating income
Same Park (1)		72,235		66,492		8.6%		280,888		262,588		7.0%	Same Park (1)		71,821		67,451		6.5%		279,792		259,021		8.0%
Non-Same Park (1)		3,870		2,072		86.8%		12,306		5,650		117.8%	Non-Same Park (1)		3,535		1,440		145.5%		10,616		4,591		131.2%
Multifamily		944		1,035		(8.8%)		4,422		5,200		(15.0%)	Multifamily		944		1,067		(11.5%)		4,422		5,228		(15.4%)
Assets sold or held for sale		1,449		3,893		(62.8%)		11,948		17,882		(33.2%)	Assets sold or held for sale		1,341		4,161		(67.8%)		11,934		17,767		(32.8%)
Total net operating income	$	78,498	$	73,492		6.8%	$	309,564	$	291,320		6.3%	Total cash net operating income	$	77,641	$	74,119		4.8%	$	306,764	$	286,607		7.0%

⁽¹⁾ Refer to page 27, Definition and Non-GAAP Disclosures, for the definitions of Same Park, Non-Same Park, Cash Rental Income, Adjusted Cost of Operations, EBITDAre, and Cost of Operations table.

⁽²⁾ Same Park rental income and cash rental income include lease buyout income of $0.5 million and $0.3 million for the three months ended December 31, 2021 and 2020, respectively, and $1.9 million and $1.0 million for the years ended December 31, 2021 and 2020, respectively.

⁽³⁾ Same Park rental income is presented net of (a) accounts receivable write-offs of $0.1 million and $0.2 million for the three months ended December 31, 2021 and 2020, respectively, and $0.0 million and $1.5 million for the years ended December 31, 2021 and 2020, respectively, and (b) deferred rent receivable write-offs of $0.1 million and $0.4 million for the three months ended December 31, 2021 and 2020, respectively, and $0.3 million and $3.0 million for the years ended December 31, 2021 and 2020, respectively.

⁽⁴⁾ Same Park cash rental income is presented net of (a) accounts receivable write-offs of $0.1 million and $0.2 million for the three months ended December 31, 2021 and 2020, respectively, and $0.0 million and $1.5 million for the years ended December 31, 2021 and 2020, respectively, and (b) rent deferrals and abatements of $0.0 million and $0.2 million for the three months ended December 31, 2021 and 2020, respectively, and $0.6 million and $6.5 million for the years ended December 31, 2021 and 2020, respectively.

⁽⁵⁾ Refer to page 10 for a reconciliation of cash rental income to rental income and adjusted cost of operations to cost of operations as reported on our GAAP statements of income.

EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION FOR REAL ESTATE (EBITDAre) (1)
	For the Three Months Ended						For the Years Ended
	December 31,						December 31,
	2021		2020		$ Change		2021		2020		$ Change
Net income	$	357,009	$	46,295	$	310,714	$	553,029	$	206,705	$	346,324
Net interest (income) expense		243		133		110		710		178		532
Depreciation and amortization		24,130		23,668		462		93,486		96,314		(2,828)
Gain on sale of real estate facilities and development rights		(310,758)		—		(310,758)		(359,875)		(27,273)		(332,602)
Income tax expense		3,600		—		3,600		3,600		—		3,600
EBITDAre	$	74,224	$	70,096	$	4,128	$	290,950	$	275,924	$	15,026

(1) Refer to page 27, Definition and Non-GAAP Disclosures, for the definitions of Same Park, Non-Same Park, Cash Rental Income, Adjusted Cost of Operations, EBITDAre, and Cost of Operations table.

Fourth Quarter 2021 Supplemental Financial Reporting Package    13

  Same Park ⁽¹⁾ Cash NOI by Region and Type (in thousands)

	For the Three Months Ended
	December 31, 2021												December 31, 2020												Total
	Industrial			Flex			Office			Total			Industrial			Flex			Office			Total			% Change
Cash rental income (1)
Northern California	$	24,411		$	2,603		$	2,521		$	29,535		$	21,823		$	2,390		$	2,888		$	27,101			9.0	%
Southern California		10,057			3,373			213			13,643			9,306			3,055			224			12,585			8.4	%
Dallas		3,194			2,028			—			5,222			2,971			1,798			—			4,769			9.5	%
Austin		2,374			5,972			—			8,346			2,208			6,315			—			8,523			(2.1	%)
Northern Virginia		5,187			5,551			9,266			20,004			5,094			5,620			9,296			20,010			0.0	%
South Florida		12,479			603			62			13,144			11,270			507			38			11,815			11.2	%
Seattle		3,250			1,746			145			5,141			3,055			1,737			132			4,924			4.4	%
Suburban Maryland		1,187			—			3,784			4,971			1,135			—			3,704			4,839			2.7	%
Total		62,139			21,876			15,991			100,006			56,862			21,422			16,282			94,566			5.8	%
Adjusted cost of operations (1)
Northern California		5,244			710			843			6,797			4,958			686			771			6,415			6.0	%
Southern California		2,334			944			84			3,362			2,155			885			98			3,138			7.1	%
Dallas		829			652			—			1,481			872			725			—			1,597			(7.3	%)
Austin		722			2,110			—			2,832			754			2,245			—			2,999			(5.6	%)
Northern Virginia		1,568			1,733			3,834			7,135			1,398			1,768			3,574			6,740			5.9	%
South Florida		3,414			165			41			3,620			3,035			150			16			3,201			13.1	%
Seattle		822			418			56			1,296			780			410			55			1,245			4.1	%
Suburban Maryland		303			—			1,359			1,662			349			—			1,431			1,780			(6.6	%)
Total		15,236			6,732			6,217			28,185			14,301			6,869			5,945			27,115			3.9	%
Cash NOI (1)
Northern California		19,167			1,893			1,678			22,738			16,865			1,704			2,117			20,686			9.9	%
Southern California		7,723			2,429			129			10,281			7,151			2,170			126			9,447			8.8	%
Dallas		2,365			1,376			—			3,741			2,099			1,073			—			3,172			17.9	%
Austin		1,652			3,862			—			5,514			1,454			4,070			—			5,524			(0.2	%)
Northern Virginia		3,619			3,818			5,432			12,869			3,696			3,852			5,722			13,270			(3.0	%)
South Florida		9,065			438			21			9,524			8,235			357			22			8,614			10.6	%
Seattle		2,428			1,328			89			3,845			2,275			1,327			77			3,679			4.5	%
Suburban Maryland		884			—			2,425			3,309			786			—			2,273			3,059			8.2	%
Total	$	46,903		$	15,144		$	9,774		$	71,821		$	42,561		$	14,553		$	10,337		$	67,451			6.5	%
Percentage by Product Type		65.3	%		21.1	%		13.6	%		100.0	%		63.1	%		21.6	%		15.3	%		100.0	%
					Industrial						Flex						Office
Cash NOI Period Growth by Type					10.2%						4.1%						-5.4%

⁽¹⁾ Refer to page 27, Definitions and Non-GAAP Disclosures, for the definitions of Same Park, Cash Rental Income, Adjusted Cost of Operations, and Cash NOI.

Fourth Quarter 2021 Supplemental Financial Reporting Package    14

  Same Park ⁽¹⁾ Cash NOI by Region and Type (in thousands)

	For the Years Ended
	December 31, 2021												December 31, 2020												Total
	Industrial			Flex			Office			Total			Industrial			Flex			Office			Total			% Change
Cash rental income (1)
Northern California	$	94,414		$	10,040		$	10,516		$	114,970		$	84,337		$	9,357		$	12,139		$	105,833			8.6	%
Southern California		39,072			13,423			852			53,347			34,879			12,108			815			47,802			11.6	%
Dallas		12,568			7,995			—			20,563			11,780			7,490			—			19,270			6.7	%
Austin		9,191			25,223			—			34,414			8,270			24,546			—			32,816			4.9	%
Northern Virginia		20,381			22,270			35,731			78,382			19,972			21,327			35,718			77,017			1.8	%
South Florida		47,351			2,094			186			49,631			42,102			1,880			137			44,119			12.5	%
Seattle		12,723			7,075			556			20,354			11,831			6,873			607			19,311			5.4	%
Suburban Maryland		4,357			—			15,107			19,464			4,146			—			15,567			19,713			(1.3	%)
Total		240,057			88,120			62,948			391,125			217,317			83,581			64,983			365,881			6.9	%
Adjusted cost of operations (1)
Northern California		20,074			2,755			3,127			25,956			19,340			2,672			3,109			25,121			3.3	%
Southern California		9,343			3,575			345			13,263			9,053			3,473			344			12,870			3.1	%
Dallas		4,015			3,085			—			7,100			3,885			3,260			—			7,145			(0.6	%)
Austin		3,184			9,486			—			12,670			3,022			9,019			—			12,041			5.2	%
Northern Virginia		6,190			6,823			13,970			26,983			5,785			6,333			13,264			25,382			6.3	%
South Florida		12,770			607			99			13,476			11,841			562			67			12,470			8.1	%
Seattle		3,279			1,701			253			5,233			3,192			1,635			224			5,051			3.6	%
Suburban Maryland		1,237			—			5,415			6,652			1,243			—			5,537			6,780			(1.9	%)
Total		60,092			28,032			23,209			111,333			57,361			26,954			22,545			106,860			4.2	%
Cash NOI (1)
Northern California		74,340			7,285			7,389			89,014			64,997			6,685			9,030			80,712			10.3	%
Southern California		29,729			9,848			507			40,084			25,826			8,635			471			34,932			14.7	%
Dallas		8,553			4,910			—			13,463			7,895			4,230			—			12,125			11.0	%
Austin		6,007			15,737			—			21,744			5,248			15,527			—			20,775			4.7	%
Northern Virginia		14,191			15,447			21,761			51,399			14,187			14,994			22,454			51,635			(0.5	%)
South Florida		34,581			1,487			87			36,155			30,261			1,318			70			31,649			14.2	%
Seattle		9,444			5,374			303			15,121			8,639			5,238			383			14,260			6.0	%
Suburban Maryland		3,120			—			9,692			12,812			2,903			—			10,030			12,933			(0.9	%)
Total	$	179,965		$	60,088		$	39,739		$	279,792		$	159,956		$	56,627		$	42,438		$	259,021			8.0	%
Percentage by Product Type		64.3	%		21.5	%		14.2	%		100.0	%		61.7	%		21.9	%		16.4	%		100.0	%
					Industrial						Flex						Office
Cash NOI Period Growth by Type					12.5%						6.1%						-6.4%

⁽¹⁾ Refer to page 27, Definitions and Non-GAAP Disclosures, for the definitions of Same Park, Cash Rental Income, Adjusted Cost of Operations, and Cash NOI.

Fourth Quarter 2021 Supplemental Financial Reporting Package    15

  Capitalization Summary (unaudited and in thousands, except share and per share data)

	As of December 31, 2021									As of December 31, 2020
				% of Total									% of Total
				Market			Wtd Avg						Market			Wtd Avg
	Total			Capitalization			Rate			Total			Capitalization			Rate
Common Stock:
Common stock (27,589,807 and 27,488,547 shares outstanding as of December 31, 2021 and 2020, respectively) (1)	$	5,081,215			70.7	%				$	3,652,403			66.4	%
Common operating partnership units (7,305,355 units outstanding as of December 31, 2021 and 2020, respectively) (1)		1,345,427			18.7	%					970,663			17.7	%
Total common equity and operating partnership units (1)	$	6,426,642			89.4	%				$	4,623,066			84.1	%
Preferred Equity:
5.200% Series W preferred stock (7,590,000 depositary shares outstanding) redeemed 11/20/21	$	-			-					$	189,750			3.5	%
5.250% Series X preferred stock (9,200,000 depositary shares outstanding) callable 9/21/22		230,000			3.2	%					230,000			4.2	%
5.200% Series Y preferred stock (8,000,000 depositary shares outstanding) callable 12/7/22		200,000			2.8	%					200,000			3.6	%
4.875% Series Z preferred stock (13,000,000 depositary shares outstanding) callable 11/4/24		325,000			4.5	%					325,000			5.9	%
Total preferred equity	$	755,000			10.5	%		5.08	%	$	944,750			17.2	%		5.10	%
Unsecured Debt:
Credit facility borrowing ($400.0 million at LIBOR + 0.70%) (2)	$	32,000			0.4	%		0.80	%	$	-
Credit facility borrowing ($250.0 million at LIBOR + 0.825%) (2)		-									-
Unrestricted cash		(27,074	)		(0.4	%)					(69,083	)		(1.3	%)
Net debt	$	4,926			0.1	%				$	(69,083	)		(1.3	%)
Total net debt and preferred equity	$	759,926			10.6	%		4.90	%	$	875,667			15.9	%		5.10	%
Total implied market capitalization	$	7,186,568			100.0	%				$	5,498,733			100.0	%
Interest expense and related expenses (3)	$	1,000								$	552
Preferred distributions		41,940									48,188
Total fixed charges and preferred distributions	$	42,940								$	48,740
Ratio of EBITDAre to fixed charges and preferred distributions (4)		6.9x									5.8x
Ratio of net debt and preferred equity to EBITDAre (5)		2.6x									3.1x

⁽¹⁾ Total common equity is calculated as the total number of common stock and operating partnership units outstanding multiplied by the Company’s closing share price at the end of each respective period shown. Closing share prices on December 31, 2021 and December 31, 2020 were $184.17 and $132.87, respectively.

⁽²⁾ In August 2021, the Company amended and restated its Credit Facility which increased the aggregate principal amount of the Credit Facility from $250.0 million to $400.0 million.

⁽³⁾ Interest expense and related expenses includes facility fees associated with our unsecured credit facility.

⁽⁴⁾ For each period shown, ratio of total fixed charges to EBITDAre is calculated using the respective quarter’s annualized fixed charges divided by the respective quarter’s annualized EBITDAre.

⁽⁵⁾ For each period shown, ratio of debt and preferred equity to EBITDAre is calculated using total net debt and preferred equity reported during the quarter divided by the respective quarter’s annualized EBITDAre.

Fourth Quarter 2021 Supplemental Financial Reporting Package    16

  Analysis of Capital Expenditures (unaudited and in thousands, except per square foot data)

	For the Years Ended December 31,
	2021		2020
Commercial Recurring Capital Expenditures (1)
Same Park
Capital improvements	$	11,139	$	8,288
Tenant improvements		13,085		13,833
Lease commissions		8,117		6,049
Total Same Park Recurring Capital Expenditures		32,341		28,170
Non-Same Park
Capital improvements		196		18
Tenant improvements		595		139
Lease commissions		375		2,104
Total Non-Same Park Recurring Capital Expenditures		1,166		2,261
Total Recurring Capital Expenditures		33,507		30,431
Assets sold or held for sale Recurring Capital Expenditures		1,615		3,892
Total commercial Recurring Capital Expenditures		35,122		34,323
Non-recurring Property Renovations (1)		2,705		1,715
Multifamily capital expenditures		13		24
Total capital expenditures	$	37,840	$	36,062
Same Park Recurring Capital Expenditures as a percentage of NOI		11.5%		10.7%

⁽¹⁾

⁽¹⁾ Refer to page 27, Definitions and Non-GAAP Disclosures, for the definitions of Recurring Capital Expenditures and Non-recurring Property Renovations.

Fourth Quarter 2021 Supplemental Financial Reporting Package    17

  Portfolio Summary (unaudited)

PROPERTY INFORMATION
	For the Three Months Ended December 31,						For the Years Ended December 31,
	2021		2020		% Change		2021		2020		% Change
Total Portfolio (1)
Total rentable square footage at period end		27,010,000		26,068,000		3.6%		27,010,000		26,068,000		3.6%
Weighted average occupancy		95.5%		92.4%		3.4%		94.3%		92.2%		2.3%
Period end occupancy		95.9%		93.7%		2.3%		95.9%		93.7%		2.3%
Cash rental income per occupied square foot (2) (3)
Industrial	$	14.35	$	13.90		3.2%	$	14.21	$	13.36		6.4%
Flex	$	19.70	$	19.38		1.7%	$	20.00	$	19.04		5.0%
Office	$	25.47	$	25.47		0.0%	$	25.16	$	24.83		1.3%
Total cash rental income per occupied square foot	$	16.38	$	16.16		1.4%	$	16.35	$	15.68		4.3%
Cash rental income per available square foot (2) (3)
Industrial	$	13.94	$	12.89		8.1%	$	13.62	$	12.34		10.4%
Flex	$	18.52	$	18.13		2.2%	$	18.64	$	17.67		5.5%
Office	$	22.15	$	22.55		(1.8%)	$	21.80	$	22.50		(3.1%)
Total cash rental income per available square foot	$	15.64	$	14.93		4.8%	$	15.43	$	14.46		6.7%
Same Park Portfolio (2)
Total rentable square footage at period end		25,053,000		25,053,000		—		25,053,000		25,053,000		—
Weighted average occupancy		95.7%		92.7%		3.2%		94.4%		92.7%		1.8%
Period end occupancy		96.4%		93.7%		2.9%		96.4%		93.7%		2.9%
Cash rental income per occupied square foot (2) (4)
Industrial	$	14.60	$	14.01		4.2%	$	14.34	$	13.41		6.9%
Flex	$	19.65	$	19.33		1.7%	$	19.96	$	19.00		5.1%
Office	$	25.47	$	25.47		0.0%	$	25.16	$	24.83		1.3%
Total cash rental income per occupied square foot	$	16.67	$	16.29		2.3%	$	16.53	$	15.76		4.9%
Cash rental income per available square foot (2) (4)
Industrial	$	14.26	$	13.05		9.3%	$	13.77	$	12.47		10.4%
Flex	$	18.48	$	18.10		2.1%	$	18.61	$	17.65		5.4%
Office	$	22.15	$	22.55		(1.8%)	$	21.80	$	22.50		(3.1%)
Total cash rental income per available square foot	$	15.97	$	15.10		5.8%	$	15.61	$	14.60		6.9%
Non-Same Park Portfolio (2)
Total rentable square footage at period end		1,957,000		1,015,000		92.8%		1,957,000		1,015,000		92.8%
Weighted average occupancy		92.2%		86.1%		7.1%		92.6%		78.2%		18.4%
Period end occupancy		89.4%		93.9%		(4.8%)		89.4%		93.9%		(4.8%)
Cash rental income per occupied square foot (2) (5)
Industrial	$	11.80	$	11.32		4.2%	$	12.40	$	11.96		3.7%
Flex	$	22.94	$	22.34		2.7%	$	22.19	$	21.36		3.9%
Total cash rental income per occupied square foot	$	12.26	$	12.27		(0.1%)	$	12.97	$	13.00		(0.2%)
Cash rental income per available square foot (2) (5)
Industrial	$	10.89	$	9.72		12.0%	$	11.49	$	9.22		24.6%
Flex	$	20.91	$	19.80		5.6%	$	20.51	$	18.92		8.4%
Total cash rental income per available square foot	$	11.31	$	10.57		7.0%	$	12.02	$	10.16		18.3%
Multifamily Portfolio
Number of units		395		395		—		395		395		—
Average rent per unit (6)	$	2,078	$	2,084		(0.3%)	$	2,078	$	2,084		(0.3%)
Weighted average occupancy		94.5%		93.7%		0.9%		94.5%		92.9%		1.8%
Period end occupancy		95.7%		94.9%		0.8%		95.7%		94.9%		0.8%

⁽¹⁾ Excludes assets sold of 494,000 square feet, and 0 square feet, for the three months ended December 31, 2021, and 2020, respectively, and 958,000 square feet and 153,000 square feet for the years ended December 31, 2021 and 2020, respectively. Operating metrics from our multifamily asset are excluded from total portfolio operating metrics.

⁽²⁾ Refer to page 27, Definitions and Non-GAAP Disclosures, for the definitions of Revenue per Occupied Square Foot, RevPAF, Same Park and Non-Same Park.

⁽³⁾ Included in the calculation of Total Park revenue per occupied square foot and RevPAF is (a) lease buyout income of $0.5 million and $0.3 million for the three months ended December 31, 2021 and 2020, respectively, and $1.9 million and $1.0 million for the years ended December 31, 2021 and 2020, respectively, (b) accounts receivable write-offs of $0.1 million and $0.2 million for the three months ended December 31, 2021 and 2020, respectively, and $0.0 million and $1.5 million for the years ended December 31, 2021 and 2020, respectively, and (c) deferred rent receivable write-offs of $0.1 million and $0.4 million for the three months ended December 31, 2021 and 2020, respectively, and $0.3 million and $3.0 million for the years ended December 31, 2021 and 2020, respectively.

⁽⁴⁾ Included in the calculation of Same Park revenue per occupied square foot and RevPAF is (a) lease buyout income of $0.5 million and $0.3 million for the three months ended December 31, 2021 and 2020, respectively, and $1.9 million and $1.0 million for the years ended December 31, 2021 and 2020, respectively, (b) accounts receivable write-offs of $0.1 million and $0.2 million for the three months ended December 31, 2021 and 2020, respectively, and $0.0 million and $1.5 million for the years ended December 31, 2021 and 2020, respectively, and (c) deferred rent receivable write-offs of $0.1 million and $0.4 million for the three months ended December 31, 2021 and 2020, respectively, and $0.3 million and $3.0 million for the years ended December 31, 2021 and 2020, respectively.

⁽⁵⁾ Included in the calculation of Non-Same Park revenue per occupied square foot and RevPAF is (a) lease buyout income of $0.0 million for both each of the three months and years ended December 31, 2021 and 2020, (b) accounts receivable write-offs of $0 for each of the three months and years ended December 31, 2021 and 2020, and (c) deferred rent receivable write-offs of $0.0 million for both the three months and years ended December 31, 2021 and 2020.

⁽⁶⁾ Average rent per unit is defined as the total potential monthly rental revenue (actual rent for occupied apartment units plus market rent for vacant apartment units) divided by the total number of rentable apartment units.

Fourth Quarter 2021 Supplemental Financial Reporting Package    18

  Total Portfolio Overview by Product Type (unaudited, in thousands)

Rentable Square Footage of Properties by Product Type as of December 31, 2021 ⁽¹⁾

Markets	Industrial		Flex		Office		Total		% of Total
Northern California		6,391		593		340		7,324		27.1%
Southern California		2,989		582		31		3,602		13.3%
Dallas		2,242		793		—		3,035		11.3%
Austin		755		1,208		—		1,963		7.3%
Northern Virginia		1,810		1,242		1,726		4,778		17.7%
South Florida		3,728		126		12		3,866		14.3%
Seattle		1,052		270		28		1,350		5.0%
Suburban Maryland		341		—		751		1,092		4.0%
Total		19,308		4,814		2,888		27,010		100.0%
Percentage by Product Type		71.5%		17.8%		10.7%		100.0%

	Weighted Average Occupancy Rates by Product Type for the     Three Months Ended December 31, 2021 (1)				Weighted Average Occupancy Rates by Product Type for the     Year Ended December 31, 2021 (1)
Markets	Industrial	Flex	Office	Total	Industrial	Flex	Office	Total
Northern California	97.0%	95.3%	75.6%	95.9%	95.6%	91.4%	78.4%	94.4%
Southern California	98.5%	95.8%	96.0%	98.0%	97.7%	94.8%	95.8%	97.2%
Dallas	94.9%	92.1%	—	94.1%	90.1%	88.2%	—	89.5%
Austin	99.1%	89.7%	—	93.3%	97.5%	92.6%	—	94.5%
Northern Virginia	93.9%	98.1%	87.9%	92.8%	94.1%	97.4%	86.9%	92.4%
South Florida	98.6%	95.7%	100.0%	98.5%	97.6%	87.1%	100.0%	97.3%
Seattle	98.2%	92.6%	68.1%	96.5%	95.5%	94.4%	68.0%	94.7%
Suburban Maryland	97.9%	—	89.5%	92.1%	98.0%	—	89.4%	92.1%
Total	97.2%	94.0%	86.8%	95.5%	95.8%	93.2%	86.5%	94.3%

⁽¹⁾ Excludes assets sold or held for sale as of December 31, 2021.

Fourth Quarter 2021 Supplemental Financial Reporting Package    19

  Same Park Portfolio Overview by Product Type (unaudited, in thousands)

Rentable Square Footage of Same Park Properties by Product Type as of December 31, 2021 ⁽¹⁾

Markets	Industrial		Flex		Office		Total		% of Total
Northern California		6,391		514		340		7,245		28.9%
Southern California		2,299		582		31		2,912		11.6%
Dallas		1,300		793		—		2,093		8.4%
Austin		755		1,208		—		1,963		7.8%
Northern Virginia		1,564		1,242		1,726		4,532		18.1%
South Florida		3,728		126		12		3,866		15.4%
Seattle		1,052		270		28		1,350		5.4%
Suburban Maryland		341		—		751		1,092		4.4%
Total		17,430		4,735		2,888		25,053		100.0%
Percentage by Product Type		69.6%		18.9%		11.5%		100.0%

	Same Park Weighted Average Occupancy Rates by Product     Type for the Three  Months Ended December 31, 2021 (1)				Same Park Weighted Average Occupancy Rates by Product     Type for the Year Ended December  31, 2021 (1)
Markets	Industrial	Flex	Office	Total	Industrial	Flex	Office	Total
Northern California	97.0%	96.0%	75.6%	95.9%	95.6%	91.4%	78.4%	94.5%
Southern California	98.1%	95.8%	96.0%	97.7%	97.4%	94.8%	95.8%	96.9%
Dallas	95.1%	92.1%	—	93.9%	91.2%	88.2%	—	90.1%
Austin	99.1%	89.7%	—	93.3%	97.5%	92.6%	—	94.5%
Northern Virginia	98.7%	98.1%	87.9%	94.4%	95.6%	97.4%	86.9%	92.8%
South Florida	98.6%	95.7%	100.0%	98.5%	97.6%	87.1%	100.0%	97.3%
Seattle	98.2%	92.6%	68.1%	96.5%	95.5%	94.4%	68.0%	94.7%
Suburban Maryland	97.9%	—	89.5%	92.1%	98.0%	—	89.4%	92.1%
Total	97.7%	94.1%	86.8%	95.7%	96.1%	93.2%	86.5%	94.4%

⁽¹⁾ Excludes assets sold or held for sale as of December 31, 2021.

Fourth Quarter 2021 Supplemental Financial Reporting Package    20

  Fourth Quarter 2021 Production Statistics (unaudited)

	Total Portfolio Activity (1) (2)
Industrial (1)	Wtd. Avg.     Occupancy	Leasing     Volume		Customer       Retention	Transaction Costs     per Executed Foot		Transaction Costs     as a % of Rents  (3)	Cash Rental Rate     Change (3)	Net Effective Rent     Change (3)
Northern California	97.0%		376,000	79.6%	$	3.92	6.6%	10.3%	23.9%
Southern California	98.5%		195,000	85.7%		1.66	3.4%	11.6%	25.6%
Dallas	94.9%		152,000	72.5%		3.37	9.5%	7.8%	18.8%
Austin	99.1%		86,000	46.6%		6.26	10.2%	23.2%	81.7%
Northern Virginia	93.9%		107,000	36.8%		4.94	13.0%	0.8%	3.6%
South Florida	98.6%		231,000	69.9%		1.00	2.7%	16.0%	31.2%
Seattle	98.2%		79,000	54.5%		3.60	6.9%	11.5%	22.2%
Suburban Maryland	97.9%		20,000	100.0%		7.05	29.3%	-3.0%	-0.8%
Industrial Totals by Market	97.2%		1,246,000	74.6%	$	3.24	6.8%	11.5%	25.7%
Flex (1)
Northern California	95.3%		47,000	76.6%	$	0.75	1.9%	4.3%	9.0%
Southern California	95.8%		44,000	80.9%		1.04	3.1%	0.7%	3.9%
Dallas	92.1%		73,000	82.7%		2.82	11.4%	8.8%	18.4%
Austin	89.7%		48,000	67.0%		6.63	16.5%	7.1%	21.9%
Northern Virginia	98.1%		72,000	94.1%		2.15	7.8%	-7.8%	0.5%
South Florida	95.7%		1,000	100.0%		—	0.0%	7.0%	14.3%
Seattle	92.6%		17,000	50.5%		0.95	2.5%	2.5%	8.5%
Flex Totals by Market	94.0%		302,000	69.7%	$	2.56	8.0%	1.2%	8.0%
Office
Northern California	75.6%		29,000	70.7%	$	0.88	1.6%	-9.6%	-4.2%
Southern California	96.0%		3,000	56.8%		1.10	2.3%	3.5%	11.2%
Northern Virginia	87.9%		134,000	82.8%		3.88	3.9%	0.4%	7.1%
South Florida	100.0%		—	—		—	—	—	—
Seattle	68.1%		4,000	74.1%		—	—	1.5%	10.8%
Suburban Maryland	89.5%		37,000	98.9%		4.77	8.2%	-8.8%	-0.5%
Office Totals by Market	86.8%		207,000	71.7%	$	3.51	4.1%	-2.3%	4.7%
Company Totals by Type	95.5%		1,755,000	70.6%	$	3.15	6.4%	6.1%	16.4%

⁽¹⁾ Excludes assets sold or held for sale as of December 31, 2021.

⁽²⁾ Average lease term for leases executed during the quarter-ended December 31, 2021 was 3.6 years.

⁽³⁾ Refer to page 27, Definitions and Non-GAAP Disclosures, for the definitions of Transaction Costs as a Percentage of Rents, Cash Rental Rate Change, and Net Effective Rent Change.

Fourth Quarter 2021 Supplemental Financial Reporting Package    21

  2021 Production Statistics (unaudited)

	Total Portfolio Activity (1) (2)
Industrial (1)	Wtd. Avg.     Occupancy	Leasing         Volume		Customer         Retention	Transaction Costs     per Executed Foot		Transaction Costs     as a % of Rents  (3)	Cash Rental Rate   Change (3)	Net Effective Rent   Change (3)
Northern California	95.6%		1,532,000	76.3%	$	3.10	5.4%	12.1%	27.3%
Southern California	97.7%		923,000	79.9%		2.27	5.8%	7.6%	16.2%
Dallas	90.1%		589,000	79.0%		3.66	14.4%	4.9%	13.6%
Austin	97.5%		294,000	74.0%		2.67	6.9%	13.5%	41.0%
Northern Virginia	94.1%		482,000	63.2%		4.81	10.3%	3.7%	9.4%
South Florida	97.6%		998,000	59.9%		1.29	3.5%	11.5%	25.6%
Seattle	95.5%		279,000	74.0%		3.91	9.6%	11.5%	21.2%
Suburban Maryland	98.0%		114,000	68.5%		3.12	8.3%	-2.1%	4.9%
Industrial Totals by Market	95.8%		5,211,000	71.9%	$	2.85	6.6%	9.4%	21.7%
Flex (1)
Northern California	91.4%		237,000	69.1%	$	1.23	2.8%	1.2%	5.3%
Southern California	94.8%		207,000	76.5%		2.10	4.3%	1.0%	8.5%
Dallas	88.2%		263,000	76.8%		3.22	12.4%	4.8%	15.4%
Austin	92.6%		169,000	34.1%		5.10	12.8%	1.1%	7.2%
Northern Virginia	97.4%		508,000	91.9%		4.46	8.4%	-2.1%	3.1%
South Florida	87.1%		42,000	74.6%		1.69	3.2%	8.3%	20.7%
Seattle	94.4%		88,000	47.5%		2.25	5.7%	6.1%	13.3%
Flex Totals by Market	93.2%		1,514,000	70.9%	$	3.29	7.4%	1.0%	7.2%
Office
Northern California	78.4%		85,000	60.6%	$	0.82	1.6%	-12.0%	-10.4%
Southern California	95.8%		10,000	57.3%		2.16	4.9%	3.2%	10.5%
Northern Virginia	86.9%		458,000	69.6%		8.89	9.7%	-4.1%	2.4%
South Florida	100.0%		—	—		—	—	—	—
Seattle	68.0%		12,000	41.1%		8.08	13.6%	5.7%	15.5%
Suburban Maryland	89.4%		147,000	78.4%		3.11	6.0%	-5.8%	2.9%
Office Totals by Market	86.5%		712,000	69.9%	$	6.63	8.6%	-5.6%	0.7%
Company Totals by Type	94.3%		7,437,000	71.4%	$	3.30	7.1%	5.2%	14.7%

⁽¹⁾ Excludes assets sold or held for sale as of December 31, 2021.

⁽²⁾ Average lease term for leases executed during the year-ended December 31, 2021 was 3.4 years.

⁽³⁾ Refer to page 27, Definitions and Non-GAAP Disclosures, for the definitions of Transaction Costs as a Percentage of Rents, Cash Rental Rate Change, and Net Effective Rent Change.

Fourth Quarter 2021 Supplemental Financial Reporting Package    22

  Lease Expirations by Type (unaudited, in thousands)

Lease Expirations - Total Portfolio (1)
Year of Lease Expiration	Leased Square Footage		Annualized       Rental Income  (2)		% Total			% of Total Annualized     Rental Income
2022		5,842	$	100,237		21.9	%		21.9	%
2023		6,066		103,001		22.5	%		22.5	%
2024		4,880		86,647		19.0	%		19.0	%
2025		3,497		63,211		13.8	%		13.8	%
2026		2,454		43,908		9.6	%		9.6	%
Thereafter		3,254		60,490		13.2	%		13.2	%
Total		25,993	$	457,494		100.0	%		100.0	%
Lease Expirations - Industrial
Year of Lease Expiration	Leased Square Footage		Annualized Rental Income (2)		% of Industrial			% of Total Annualized Rental Income
2022		3,947	$	56,025		19.2	%		12.2	%
2023		4,370		64,749		22.2	%		14.2	%
2024		3,510		55,601		19.1	%		12.2	%
2025		2,479		37,465		12.8	%		8.2	%
2026		1,838		29,227		10.0	%		6.4	%
Thereafter		2,806		48,632		16.7	%		10.6	%
Total		18,950	$	291,699		100.0	%		63.8	%
Lease Expirations - Flex (1)
Year of Lease Expiration	Leased Square Footage		Annualized Rental Income (2)		% of Flex			% of Total Annualized Rental Income
2022		1,224	$	26,518		27.5	%		5.8	%
2023		1,067		21,716		22.5	%		4.7	%
2024		894		18,553		19.2	%		4.1	%
2025		683		15,335		15.9	%		3.3	%
2026		351		7,196		7.5	%		1.6	%
Thereafter		304		7,161		7.4	%		1.6	%
Total		4,523	$	96,479		100.0	%		21.1	%
Lease Expirations - Office
Year of Lease Expiration	Leased Square Footage		Annualized Rental Income (2)		% of Office			% of Total Annualized Rental Income
2022		671	$	17,694		25.5	%		3.9	%
2023		629		16,536		23.9	%		3.6	%
2024		476		12,493		18.0	%		2.7	%
2025		335		10,411		15.0	%		2.3	%
2026		265		7,485		10.8	%		1.6	%
Thereafter		144		4,697		6.8	%		1.0	%
Total		2,520	$	69,316		100.0	%		15.1	%

⁽¹⁾ Excludes assets held for sale as of December 31, 2021.

⁽²⁾ Annualized rental income represents annualized outgoing rents inclusive of related estimated expense recoveries. Actual rental income amounts may vary depending upon re-leasing of expiring spaces

Fourth Quarter 2021 Supplemental Financial Reporting Package    23

  Lease Expirations by Market (unaudited, in thousands)

Lease Expirations - Northern California
Year of Lease Expiration	Leased Square Footage		Annualized       Rental Income  (2)		% of   No. CA			% of Total Annualized     Rental Income
2022		1,096	$	22,053		16.4	%		4.8	%
2023		1,375		26,187		19.6	%		5.7	%
2024		1,222		22,411		16.7	%		4.9	%
2025		900		14,960		11.2	%		3.3	%
2026		990		18,578		13.9	%		4.1	%
Thereafter		1,588		29,688		22.2	%		6.5	%
Total		7,171	$	133,877		100.0	%		29.3	%
Lease Expirations - Southern California
Year of Lease Expiration	Leased Square Footage		Annualized Rental Income (2)		% of So. CA			% of Total Annualized Rental Income
2022		928	$	17,801		25.8	%		3.9	%
2023		869		16,897		24.6	%		3.7	%
2024		697		14,490		21.1	%		3.2	%
2025		390		7,430		10.8	%		1.6	%
2026		176		3,410		5.0	%		0.8	%
Thereafter		486		8,768		12.7	%		1.9	%
Total		3,546	$	68,796		100.0	%		15.1	%
Lease Expirations - Dallas (1)
Year of Lease Expiration	Leased Square Footage		Annualized Rental Income (2)		% of Dallas			% of Total Annualized Rental Income
2022		813	$	8,853		26.9	%		1.9	%
2023		809		9,150		27.8	%		2.0	%
2024		493		6,000		18.2	%		1.3	%
2025		294		3,436		10.4	%		0.8	%
2026		393		4,342		13.2	%		0.9	%
Thereafter		86		1,146		3.5	%		0.3	%
Total		2,888	$	32,927		100.0	%		7.2	%
Lease Expirations - Austin
Year of Lease Expiration	Leased Square Footage		Annualized Rental Income (2)		% of Austin			% of Total Annualized Rental Income
2022		391	$	8,131		21.7	%		1.8	%
2023		305		6,138		16.3	%		1.3	%
2024		374		8,277		22.1	%		1.8	%
2025		420		9,153		24.4	%		2.0	%
2026		115		2,771		7.4	%		0.6	%
Thereafter		235		3,037		8.1	%		0.6	%
Total		1,840	$	37,507		100.0	%		8.1	%

⁽¹⁾ Excludes assets held for sale as of December 31, 2021.

⁽²⁾ Annualized rental income represents annualized outgoing rents inclusive of related estimated expense recoveries. Actual rental income amounts may vary depending upon re-leasing of expiring spaces.

Fourth Quarter 2021 Supplemental Financial Reporting Package    24

  Lease Expirations by Market (unaudited, in thousands)

Lease Expirations - Northern Virginia
Year of Lease Expiration	Leased Square Footage		Annualized       Rental Income  (1)		% of   No. VA			% of Total Annualized         Rental Income
2022		1,106	$	21,476		24.4	%		4.7	%
2023		837		15,823		18.0	%		3.5	%
2024		738		14,176		16.1	%		3.1	%
2025		804		17,491		19.9	%		3.8	%
2026		333		6,965		7.9	%		1.5	%
Thereafter		563		12,025		13.7	%		2.6	%
Total		4,381	$	87,956		100.0	%		19.2	%
Lease Expirations - South Florida
Year of Lease Expiration	Leased Square Footage		Annualized Rental Income (1)		% of So. FL			% of Total Annualized Rental Income
2022		1,036	$	12,626		24.1	%		2.8	%
2023		1,124		15,199		29.0	%		3.3	%
2024		950		13,749		26.2	%		3.0	%
2025		394		5,213		9.9	%		1.1	%
2026		242		3,871		7.4	%		0.8	%
Thereafter		90		1,771		3.4	%		0.4	%
Total		3,836	$	52,429		100.0	%		11.4	%
Lease Expirations - Suburban Maryland
Year of Lease Expiration	Leased Square Footage		Annualized Rental Income (1)		% of Sub. MD			% of Total Annualized Rental Income
2022		213	$	3,949		18.2	%		0.9	%
2023		294		6,403		29.5	%		1.4	%
2024		158		3,563		16.4	%		0.8	%
2025		135		2,615		12.0	%		0.6	%
2026		90		2,293		10.6	%		0.5	%
Thereafter		128		2,883		13.3	%		0.6	%
Total		1,018	$	21,706		100.0	%		4.8	%
Lease Expirations - Seattle
Year of Lease Expiration	Leased Square Footage		Annualized Rental Income (1)		% of Seattle			% of Total Annualized Rental Income
2022		259	$	5,348		24.0	%		1.1	%
2023		453		7,204		32.3	%		1.6	%
2024		248		3,981		17.8	%		0.9	%
2025		160		2,913		13.1	%		0.6	%
2026		115		1,678		7.5	%		0.4	%
Thereafter		78		1,172		5.3	%		0.3	%
Total		1,313	$	22,296		100.0	%		4.9	%

⁽¹⁾ Annualized rental income represents annualized outgoing rents inclusive of related estimated expense recoveries. Actual rental income amounts may vary depending upon re-leasing of expiring spaces.

Fourth Quarter 2021 Supplemental Financial Reporting Package    25

  Industry Concentration and Top Ten Customers (unaudited and dollars in thousands)

Industry Concentration as of December 31, 2021 (1) (2)
					Percentage of           Total Rental Income
Business services						23.0	%
Logistics						14.7	%
Technology						10.1	%
Retail, food, and automotive						8.6	%
Construction and engineering						8.1	%
Health services						6.7	%
Government						5.2	%
Electronics						2.9	%
Home furnishings						2.4	%
Insurance and financial services						2.0	%
Aerospace/defense						1.8	%
Communications						1.6	%
Education						0.9	%
Other						12.0	%
Total						100.0	%
Top 10 Customers by Total Annual Rental Income as of December 31, 2021 (2)
Customer	Square     Footage		Annualized        Rental Income  (3)		Percentage of Total         Annualized Rental Income
US Government		465,000	$	11,989		2.8	%
Amazon Inc.		543,000		7,071		1.6	%
KZ Kitchen Cabinet & Stone		370,000		5,604		1.3	%
Luminex Corporation		199,000		4,419		1.0	%
ECS Federal, LLC		143,000		3,430		0.8	%
Lockheed Martin Corporation		124,000		2,724		0.6	%
Applied Materials, Inc.		173,000		2,689		0.6	%
CentralColo, LLC		96,000		2,495		0.6	%
Great Way Trading & Transportation, Inc.		177,000		2,126		0.5	%
Costco-Innovel Solutions LLC		180,000		2,013		0.5	%
Total		2,470,000	$	44,560		10.3	%

⁽¹⁾ Industry concentration is categorized based on customers’ Standard Industrial Classification Code.

⁽²⁾ Excludes assets held for sale as of December 31, 2021.

⁽³⁾ For leases expiring within one year, annualized rental income includes only the income to be received under the existing lease from January 1, 2022 through the respective date of expiration.

Fourth Quarter 2021 Supplemental Financial Reporting Package    26

  Definitions and Non-GAAP Disclosures

Provided within this supplemental information package are measures not defined in accordance with U.S. generally accepted accounting principles (“GAAP”). We believe our presentation of these non-GAAP measures assists investors and analysts in analyzing and comparing our operating and financial performance between reporting periods. These non-GAAP measures discussed below are not substitutes of other measures of financial performance presented in accordance with GAAP. In addition, other real estate investment trusts (“REITs”) may compute these measures differently, so comparisons among REITs may not be helpful.

Adjusted Cost of Operations – Adjusted cost of operations represents cost of operations, excluding non-cash stock compensation expense for employees whose compensation expense is recorded in cost of operations, which can vary significantly period to period based upon the performance of the Company. The GAAP measure most directly comparable to adjusted cost of operations is cost of operations.

Assets sold or held for sale – Assets sold or held for sale represents

Assets Sold in 2021:

• 70,000 square foot industrial-flex building located in Irving, Texas – Sold in December 2021

• 53,000 square foot industrial building located in Beltsville, Maryland – Sold in December 2021

• 371,000 square foot industrial-flex business park located in San Diego, California – Sold in October 2021

• 22,000 square foot industrial-flex building located in Irving, Texas – Sold in September 2021

• 244,000 square foot office business park located in Herndon, Virginia – Sold in July 2021

• 198,000 square foot office-oriented flex business park located in Chantilly, Virginia – Sold in June 2021

Assets Sold in 2020:

• 113,000 square foot office building located at Metro Park North in Rockville, Maryland – sold in January 2020

• Two industrial buildings totaling 40,000 square feet located in Redmond, Washington – sold in September 2020 (Subject to eminent domain)

Assets held for sale as of 12/31/2021:

• 702,000 square foot industrial-flex business park located in Irving, Texas.

Cash NOI – We utilize cash NOI to evaluate the cash flow performance of our business parks. Cash NOI represents NOI adjusted to exclude non-cash items included in rental income and in cost of operations. The non-cash rental income includes amortization of deferred rent receivable (net of write-offs), in-place lease intangible, tenant improvement reimbursements, and lease incentives. The non-cash expense is equal to stock compensation expense for employees whose compensation expense is recorded in cost of operations. We believe that cash NOI assists investors in analyzing cash flow performance of our business parks. The GAAP measure most directly comparable to cash NOI is net income.

Cash Rental Income – Cash rental income represents rental income, excluding non-cash rental income, specifically amortization of deferred rent receivable (net of write-offs), in-place lease intangible, tenant improvement reimbursements, and lease incentives.

Cash Rental Income per Occupied Square Feet and Cash Rental Income per Available Square Foot – Computed by dividing Cash Rental Income for the period by weighted average occupied and available square feet for the same period. Cash rental income per occupied and available square foot for the three month period shown is annualized.

Cash Rental Rate Change – Cash rental rate change percentages are computed by taking the percentage difference between outgoing rents (including estimated expense recoveries) and incoming rents (including estimated expense recoveries) for leases executed during the period. Leases executed on spaces vacant for more than the preceding twelve months have been excluded.

Fourth Quarter 2021 Supplemental Financial Reporting Package    27

  Definitions and Non-GAAP Disclosures

Core Funds from Operations (Core FFO) – We calculate Core FFO by adjusting FFO, as defined below, excluding the impact of (i) charges related to the redemption of preferred stock and (ii) other nonrecurring income or expense items as appropriate. Management believes that Core FFO is a useful supplemental measure as it provides a more meaningful and consistent comparison of operating performance and allows investors to more easily compare the Company’s operating results. Because certain of these adjustments have a real economic impact on our financial condition and results from operations, the utility of Core FFO as a measure of our performance is limited. Other REITs may not calculate Core FFO in a consistent manner. Accordingly, our Core FFO may not be comparable to other REITs’ Core FFO. Core FFO should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance.

Cost of Operations – Reflects Same Park adjusted cost of Operations. See page 13 Net Operating Income (NOI), Cash NOI and EBITDAre.

	For the Three Months Ended December 31,							For the Years Ended December 31,
	2021		2020		% Change			2021		2020		% Change
Cost of operations
Property taxes	$	9,936	$	9,827		1.1	%	$	41,958	$	41,184		1.9	%
Utilities		4,746		4,235		12.1	%		18,066		17,170		5.2	%
Repairs and maintenance		6,452		6,680		(3.4	%)		23,064		22,697		1.6	%
Compensation		4,137		3,835		7.9	%		16,082		15,522		3.6	%
Snow removal		9		162		(94.4	%)		1,021		233		338.2	%
Property insurance		1,227		1,036		18.4	%		4,778		3,943		21.2	%
Other expenses		1,678		1,340		25.2	%		6,364		6,111		4.1	%
Total cost of operations	$	28,185	$	27,115		3.9	%	$	111,333	$	106,860		4.2	%

Earnings before Interest, Taxes, Depreciation and Amortization for Real Estate (“EBITDAre”) – EBITDAre is defined by the National Association of Real Estate Investment Trusts (“NAREIT”) and is often utilized to evaluate the performance of real estate companies. EBITDAre is calculated as GAAP net income before interest, depreciation and amortization and adjusted to exclude gains or losses from sales of depreciable real estate assets and impairment charges on real estate assets. We believe our presentation of EBITDAre assists investors and analysts in evaluating the operating performance of our business activities, including the impact of general and administrative expenses, and without the impact from gains or losses from sales of depreciable real estate assets. The GAAP measure most directly comparable EBITDAre is net income.

Free Cash Available after Fixed Charges – Free cash available after fixed charges represents FAD less dividends and distributions.

Funds Available for Distribution (FAD) – FAD is a non-GAAP measure that represents Core FFO adjusted to (a) deduct recurring capital improvements that maintains the condition of our real estate, tenant improvements and lease commissions and (b) remove certain non-cash rental income or expenses such as amortization of deferred rent receivable and non-cash stock compensation expense. We believe our presentation of FAD assists investors and analysts in analyzing and comparing our operating and financial performance between reporting periods. FAD is not a substitute for GAAP net cash flow in evaluating our liquidity or ability to pay dividends, because they exclude investing and financing activities presented on our statements of cash flows. The GAAP measure most directly comparable to FAD is operating cash flow from our statements of cash flows.

Funds from Operations (FFO) – We calculate FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts (“NAREIT”). FFO represents net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from sales of depreciable operating property, gains (or losses) from sales of assets incidental to our business, impairment losses of depreciable operating property or assets incidental to our business, real estate related depreciation and amortization (excluding amortization of deferred financing costs and amortization of above/below-market lease intangibles) and after adjustments for unconsolidated joint ventures. Management uses FFO as a supplemental performance measure because, in excluding real estate related depreciation and amortization, gains and losses from property dispositions, other than temporary impairments of unconsolidated real estate entities, and impairment on our investment in real estate, it provides a performance measure that, when compared year over year, captures trends in occupancy rates, rental rates and operating costs. We also believe that, as a widely recognized measure of performance used by other REITs, FFO may be used by investors as a basis to compare our operating performance with that of other REITs. However, because FFO excludes depreciation and amortization and captures neither the changes in the value of our properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of our properties, all of which have real economic effects and could materially impact our results from operations, the utility of FFO as a measure of our performance is limited. Other equity REITs may not calculate or interpret FFO in accordance with the NAREIT definition as we do, and, accordingly, our FFO may not be comparable

Fourth Quarter 2021 Supplemental Financial Reporting Package    28

  Definitions and Non-GAAP Disclosures

to such other REITs’ FFO. FFO should not be used as a measure of our liquidity and is not indicative of funds available for our cash needs, including our ability to pay dividends. FFO should be considered only as a supplement to net income computed in accordance with GAAP as a measure of our performance. A reconciliation of net income, the nearest GAAP equivalent, to FFO is under the additional financial data section.

Net Effective Rent Growth – Average net effective rent growth represents the weighted average percentage change in net effective rents for leases executed during a period compared against the prior leases for the same units. Net effective rent represents average rental payments for the term of a lease on a straight-line basis, against the ending lease rates on prior leases for the same units, excluding operating expense reimbursements.

Net Operating Income (NOI) – We utilize NOI, a non-GAAP financial measure, to evaluate the operating performance of our business parks. We define NOI as rental income less adjusted cost of operations (described below). We believe NOI assists investors in analyzing the performance and value of our business parks by excluding (i) corporate overhead (i.e. general and administrative expenses) because it does not relate to the results of our business parks, (ii) depreciation and amortization expense because it does not accurately reflect changes in the fair value of our business parks and (iii) non-cash stock compensation expense because this expense item can vary significantly from period to period and thus impact comparability across periods. The GAAP measure most directly comparable to NOI is net income.

Non-Recurring Property Renovations – Non-recurring property renovations represents renovations that substantially enhance the value of a property, including capitalized costs associated with repositioning acquired assets.

Non-Same Park – Non-Same Park includes assets acquired on or subsequent to January 1, 2019.

Recurring Capital Expenditures – Recurring capital expenditures are capitalized costs necessary to continue to operate the property at its current economic value. Capital improvements in excess of $2,000 with a useful life greater than 24 months are capitalized. Lease transaction costs (i.e. tenant improvements and leasing commissions) of $1,000 or more for leases with terms greater than 12 months are capitalized. All leasing costs, including first generation tenant improvements and leasing commissions, are included in recurring capital expenditures.

Retained Cash – Retained cash represents free cash available after fixed charges less non-recurring property renovations and funds used for development and redevelopment.

Same Park – The Company believes that evaluation of the Same Park portfolio, defined as all properties owned and operated as of December 31, 2021 that were acquired prior to January 1, 2019, provides an informative view of how the Company’s portfolio has performed over comparable periods. As of December 31, 2021, the Same Park portfolio consisted of 25.1 million rentable square feet, or 92.8% of the Company’s 27.0 million total rentable square feet, excluding the Company’s 95.0% interest in a 395-unit multifamily property and 702,000 square feet of assets held for sale.

Transaction Costs as a Percentage of Rents – Transaction costs as a percentage of rents are computed by taking the total transaction costs divided by the total rents (including estimated expense recoveries) over the term of the lease.

Fourth Quarter 2021 Supplemental Financial Reporting Package    29

XML

Document and Entity Information	Feb. 22, 2022
Document And Entity Information [Line Items]
Entity Registrant Name	PS BUSINESS PARKS, INC./MD
Amendment Flag	false
Entity Central Index Key	0000866368
Document Type	8-K
Document Period End Date	Feb. 22, 2022
Entity Incorporation State Country Code	MD
Entity File Number	1-10709
Entity Tax Identification Number	95-4300881
Entity Address, Address Line One	701 Western Avenue
Entity Address, City or Town	Glendale
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	91201-2349
City Area Code	(818)
Local Phone Number	244-8080
Written Communications	false
Soliciting Material	false
Pre Commencement Tender Offer	false
Pre Commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Common Stock [Member]
Document And Entity Information [Line Items]
Security 12b Title	Common Stock, $0.01 par value per share
Trading Symbol	PSB
Security Exchange Name	NYSE
Depositary Shares Each Representing 11000 Of A 5.250 Cum Pref Share Series X 0.01 Par Value [Member]
Document And Entity Information [Line Items]
Security 12b Title	Depositary Shares Each Representing 1/1,000 of a 5.250% Cum Pref Share, Series X, $0.01 par value
Trading Symbol	PSBPrX
Security Exchange Name	NYSE
Depositary Shares Each Representing 11000 Of A 5.200 Cum Pref Share Series Y 0.01 Par Value [Member]
Document And Entity Information [Line Items]
Security 12b Title	Depositary Shares Each Representing 1/1,000 of a 5.200% Cum Pref Share, Series Y, $0.01 par value
Trading Symbol	PSBPrY
Security Exchange Name	NYSE
Depositary Shares Each Representing 11000 Of A 4.875 Cum Pref Share Series Z 0.01 Par Value [Member]
Document And Entity Information [Line Items]
Security 12b Title	Depositary Shares Each Representing 1/1,000 of a 4.875% Cum Pref Share, Series Z, $0.01 par value
Trading Symbol	PSBPrZ
Security Exchange Name	NYSE