CORPORATE OFFICE PROPERTIES TRUST Results for 1Q 2020 April 30, - PowerPoint PPT Presentation

CORPORATE OFFICE PROPERTIES TRUST Results for 1Q 2020 April 30, 2020 The Preferred Provider of Mission Critical Real Estate Solutions

Table of Contents Results for 1Q 2020…............................Page 3 Safe Harbor I. Unless otherwise noted, information in this presentation represents the Company’s consolidated portfolio as of or for the quarter ended March 31, 2020. Factors Supporting Growth……………Page 6 II. This presentation may contain “forward - looking” statements, as defined in Section 27A of the Securities Act of 1933 and Section 21E of the Minimal Impact from COVID- 19……...Page 16 III. Securities Exchange Act of 1934, that are based on the Company’s current expectations, estimates and projections about future events and financial trends affecting the Company. These statements may include, 2020 Guidance………....………..……...Page 26 IV. without limitation, statements regarding: our belief that we are well- positioned to maintain relative normal operations through the COVID-19 crisis; our expectations as to renewal leasing, rent relief requests, Appendices……………………………...Page 30 V. development leasing and development projects; our liquidity situation; and our dividend. Forward-looking statements are inherently subject to risks and uncertainties, many of which the Company cannot predict with A. Definitions & Glossary accuracy and some of which the Company might not even anticipate. B. Reconciliations Although the Company believes that expectations, estimates and projections reflected in such forward-looking statements are based on reasonable assumptions at the time made, the Company can give no assurance that these expectations, estimates and projections will be achieved. Future events and actual results may differ materially from those discussed in the forward-looking statements and the Company undertakes no obligation to update or supplement any forward-looking statements. The areas of risk that may affect these expectations, estimates and projections include, but are not limited to, those risks described in Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, as well as risks associated with the impact of the global outbreak of the coronavirus (COVID-19), such as: potential adverse impacts on our tenants that may ultimately impact their ability to pay rent to us on time or at all; steps that have been and may be taken by national, state and local governmental authorities, including ongoing and potential future temporary closure requirements and uncertainty regarding the duration of these requirements; potential challenges to our development operations caused by supply chain disruptions; and potential impacts of the outbreak on our access to capital. 2

Results for 4Q & FY 2018 I. Results for 1Q 2020 I. Rendering of 100 Secured Gateway 3

1Q 2020 Recap Strong 1Q Results; Minimal Impact from COVID-19 Pandemic Incurred or Expected Ample Liquidity 2.2 million SF Solid Leasing Under Development 1 › Over $700 million of liquidity to › 631,000 SF executed in 1Q fund remaining ~$225 million of › 78% leased development investment Minimal Impact from Core Portfolio COVID-19 ~$175 million of debt 94.0% occupied, › Active and granted rent relief capital raised requests total <0.75% of ARR 2 95.2% leased › Collected 97.4% of total April billings (98.7% of billings less rent relief) 1. Excludes a 106,000 SF redevelopment project that was 80% pre-leased at March 31, 2020. Annualized rental revenue (“ARR”). 2. 4

Results 1Q20 Guidance Actual $0.47 – $0.49 FFOPS* $0.51 Same-Property: ▪ Occupancy 91.5% – 92.5% 92.7% -- ▪ Cash NOI Growth 5.0% 75% – 80%** 89% Tenant Retention Development Spend -- ~ $100 mm Development Leasing Achieved: ▪ 1Q -- -- ▪ 2Q † -- 46,000 SF Total to-date 46,000 SF * FFOPS = diluted funds from operations per share, as adjusted for comparability. ** Tenant retention guidance is for the full year. † As of April 30, 2020. 5

Results for 4Q & FY 2018 I. Factors Supporting Growth II. 250 West Pratt Street Lobby Renovation 6

Healthy DoD Spending Levels » Bi-partisan agreement for FY20 & FY21 Budgets eliminates sequestration threat (Budget Control Act of 2011 sunsets after FY21) » FY 2020 Budget signed in December 2019 raised Base Budget another 3% » FY 2015 –FY 2020, DoD’s Base Budget has grown at a compound annual rate of 5% DoD’s Discretionary Budget Authority (“Base Budget”)* Current dollars, in billions. Sources: Historical data through FY 2016 are pulled from Tables 1-9 and 2-1 of the National Defense Budget Estimates ("Green Books") for FY 2017 or earlier; data for FY 2017 through FY 2019 are pulled from Tables 1-2 and 2-1 of the FY 2020 Green Book; Capital Alpha Partners; COPT’s IR Department. † DoD base budget (051) numbers exclude funding for overseas contingency operations ("OCO"), Atomic Energy Defense Activiti es (053), Other Defense-Related Activities (054), and mandatory spending. * FY 2017 includes $8.25 billion of "OCO for base budget purposes." Source: CRS report on the final authorizations. ** FY 2018 includes $5.8 billion of supplemental authorizations for Missile Defense. 7 ‡ Estimated, using the 2020 DoD Appropriations Act and the 2020 Military Construction, Veterans Affairs, and Related Agenci es Appropriations Act.

Mandate to Restore & Fund U.S. Military » A 2018 Pentagon Study reported that the DoD funding deficit created by the Budget Control Act of 2011 and the multi-year failure to provide timely appropriations had eroded U.S. Military power “to a dangerous degree,” and provided the imperative to correct it Prior Spending Deficit in Base Budget (050) Source: National Defense Strategy Commission’s Providing for the Common Defense (2018): https://www.usip.org/publications/2018/11/providing-common-defense 8

Growth from Development Leasing Robust Shadow Development Pipeline bodes well for future development leasing & NOI growth Development Leasing » After record year in 2019, demand for new facilities remains strong 2,000,000 » Completed one build-to- suit thus far in 2020*; 1,500,000 await delivery of large U.S. Government lease at 1,000,000 Redstone Gateway » Our Shadow 500,000 Development Pipeline of over 2 million SF* 0 supports our development leasing goal and future Actual SF Forecasted Initial Goal growth * As of April 30, 2020. 9

Highly Leased Developments Drive NOI Growth » Between 2011 – 2019, Square Feet of Development Placed Into Service we placed 7.5 million SF 1,600,000 100% into service that, on average, were 90% 90% 1,400,000 leased 80% » We placed 230,000 SF 1,200,000 840,000 SF 70% PIS annually, ($54 million) that were 90% leased 1,000,000 100% leased into 60% service during 1Q20 800,000 50% » During 2Q – 4Q 2020, we 40% 600,000 expect to place another 30% 1.15 million SF ($242 400,000 million) that are 98% 20% leased into service, 200,000 10% contributing to FFO growth this year, and - 0% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 E into 2021/2022 SF PIS Forecasted % Leased 10

Demand for Existing Space Continues to Build » Strong Vacancy Leasing of 143,000 SF in 1Q20 was 13% higher than 1Q19 results » Expect additional Vacancy Leasing and strong renewal rates during remainder of the year Vacancy Leasing in COPT’s Operating Portfolio* 100% 2019 2016 2017 2018 900 95% 800 90% Square Feet of Vacancy Leased (000s) Core Portfolio % Leased and Occupied 700 85% 600 80% 500 75% 400 70% 300 65% 200 60% 100 55% 0 50% Defense/IT Regional Office % Leased % Occ * Percent occupied & leased statistics are for COPT’s core portfolio. 11

Strong Tenant Retention Tenant co- investment creates “stickiness” and supports COPT’s sector -leading tenant retention rates and low renewal CapX COPT’s Renewal Rates Since 2010 » Proven track record of strong tenant retention 100% rates, averaging: 90% » 71% between 2000−2019 80% 70% » 78% between 2016−2019 60% » Increasing 2020 tenant 50% retention guidance range by 5%, to 75 – 80% 40% 30% » FFO & AFFO benefits of 20% high renewal rates more than offset impact of cash 10% rent roll downs 0% Source: Company Supplemental Reports 12

Large Leases Update Continued Strong Retention of Large Tenants* » 2020 Large Leases % # 2020 Renewal ▪ 1Q renewals (281,000 SF) Large Leases Leases SF Expected included 1 contractor & 1 USG ▪ USG 3 375,000 100% lease ▪ Contractor(s) 2 288,000 49% ▪ As expected, tenant at 6721 ▪ Commercial -- -- -- Columbia Gateway Drive did not 5 663,000 80% renew (131,000 SF) on 4/30 ▪ One floor already back-filled % » 2021 Large Leases 2021 # Renewal Large Leases Leases SF Expected ▪ 3-building Boeing campus at ▪ USG -- -- -- Redstone Gateway expected to ▪ Contractor(s) 4 493,000 100% renew ▪ Commercial -- -- -- ▪ Contractor at NBP also expected 4 493,000 100% to renew * Large lease is defined as 100,000 SF or more. 13