DEBT OBLIGATIONS

The following table sets forth information regarding the Company’s consolidated debt obligations at June 30, 2014 and December 31, 2013 (in thousands):



Property / Location	June 30, 2014			December 31, 2013			Effective Interest Rate			Maturity Date
MORTGAGE DEBT:
Tysons Corner	$	90,460		$	91,395		5.36	%	(a)	Aug 2015
One Commerce Square	124,151			125,089			3.68	%	(a)	Jan 2016
Two Logan Square	88,174			88,583			7.57	%		Apr 2016
Fairview Eleven Tower	21,470			21,630			4.25	%	(b)	Jan 2017
Two Commerce Square	112,000			112,000			4.51	%	(a)	Apr 2023
Cira Square (GSA Philadelphia Campus)	187,751			190,964			7.00	%		Sep 2030
Cira Centre South Garage	38,950			40,101			7.12	%		Sep 2030
Principal balance outstanding	662,956			669,762
Plus: fair market value premiums (discounts), net	(478		)	389
Total mortgage indebtedness	$	662,478		$	670,151
UNSECURED DEBT:
Three-Year Term Loan - Swapped to fixed	$	150,000		$	150,000		2.60	%		Feb 2015
Four-Year Term Loan	100,000			100,000			LIBOR + 1.75%		(c)	Feb 2016
Seven-Year Term Loan - Swapped to fixed	200,000			200,000			3.62	%		Feb 2019
$250.0M 5.400% Guaranteed Notes due 2014	218,549			218,549			5.53	%		Nov 2014
$250.0M 7.500% Guaranteed Notes due 2015	157,625			157,625			7.76	%		May 2015
$250.0M 6.000% Guaranteed Notes due 2016	149,919			149,919			5.95	%		Apr 2016
$300.0M 5.700% Guaranteed Notes due 2017	300,000			300,000			5.68	%		May 2017
$325.0M 4.950% Guaranteed Notes due 2018	325,000			325,000			5.13	%		Apr 2018
$250.0M 3.950% Guaranteed Notes due 2023	250,000			250,000			4.02	%		Feb 2023
Indenture IA (Preferred Trust I)	27,062			27,062			2.75	%		Mar 2035
Indenture IB (Preferred Trust I)	25,774			25,774			3.30	%		Apr 2035
Indenture II (Preferred Trust II)	25,774			25,774			3.09	%		Jul 2035
Principal balance outstanding	1,929,703			1,929,703
Plus: original issue premiums (discounts), net	(3,931		)	(4,473		)
Total unsecured indebtedness	$	1,925,772		$	1,925,230
Total Debt Obligations	$	2,588,250		$	2,595,381


(a)	These loans were assumed upon acquisition of the related properties. The interest rate reflects the market rate at the time of acquisition.


(b)	Represents the full debt amount secured by a property owned by a consolidated real estate venture in which the Company holds a 50% interest.


(c)	London Interbank Offered Rate (“LIBOR”).

During the six-month periods ended June 30, 2014 and 2013, the Company’s weighted-average effective interest rate on its mortgage notes payable was 5.73% and 6.64%, respectively.

The Parent Company unconditionally guarantees the unsecured debt obligations of the Operating Partnership (or is a co-borrower with the Operating Partnership) but does not by itself incur unsecured indebtedness. The Parent Company has no material assets other than its investment in the Operating Partnership.

The Company utilizes its unsecured revolving credit facility (the "Credit Facility") for general business purposes, including funding costs of acquisitions, developments and redevelopments and repayment of other debt. The scheduled maturity date of the Credit Facility in place at June 30, 2014 is February 1, 2016. The per annum variable interest rate on balances outstanding under the Credit Facility is LIBOR plus 1.50%. The interest rate and facility fee are subject to adjustment upon a change in the Company’s unsecured debt ratings. As of June 30, 2014, the Company did not have any outstanding borrowings on its Credit Facility, with $1.5 million in letters of credit outstanding, leaving $598.5 million of unused availability under the Credit Facility. During each of the three and six-month periods ended June 30, 2014 and 2013, there were no weighted-average interest rates associated with the Credit Facility because there were no borrowings outstanding under the Credit Facility during either period.

The Company has the option to increase the amounts available to be advanced under the Credit Facility, the $150.0 million three-year term loan, and the $100.0 million four-year term loan by an aggregate of $200.0 million, subject to customary conditions and limitations, by obtaining additional commitments from the current lenders and other financial institutions. The Company also has the option to extend by one year the maturity dates of each of the Credit Facility, the $150.0 million three-year term loan and the $100.0 million four-year term loan subject to payment of an extension fee and other customary conditions and limitations. The Company may repay the $150.0 million three-year term loan and the $100.0 million four-year term loan at any time without penalty. The $200.0 million seven-year term loan is subject to a prepayment penalty of 1.00% through February 1, 2015 with no penalty thereafter.

The spread to LIBOR for LIBOR-based loans under the Credit Facility and term loans depends on the Company's unsecured senior debt credit rating. Based on the Company's current credit rating, the spread for such loans will be 150 basis points under the Credit Facility, 175 basis points under both the $150.0 million three-year term loan and the $100.0 million four-year term loan and 190 basis points under the $200.0 million seven-year term loan. At the Company's option, advances under the Credit Facility and term loans may also bear interest at a per annum floating rate equal to the higher of the prime rate or the federal funds rate plus 0.50% per annum. The Credit Facility contains a competitive bid option that allows banks that are part of the lender consortium to bid on loans to the Company at a reduced rate.

The Company executed hedging transactions that fix the rate on the $200.0 million seven-year term loan at a 3.623% average rate for its full term, and the rate on the $150.0 million three-year term loan at a 2.596% average rate for periods of three to four years. All hedges commenced on February 1, 2012 and the rates are inclusive of the LIBOR spread based on the Company's current investment grade rating. See Note 9 for details of the interest rate swaps entered into as of June 30, 2014.

The Credit Facility and term loans contain financial and operating covenants and restrictions. The Company was in compliance with all such restrictions and financial covenants as of June 30, 2014. In the event of a default related to the financing and operating covenants, the Company's dividend distributions are limited to the greater of 95% of funds from operations or the minimum amount necessary for the Company to maintain its status as a REIT.

As of June 30, 2014, the Company’s aggregate scheduled principal payments on debt obligations, excluding amortization of discounts and premiums, were as follows (in thousands):



2014 (six months remaining)	$	225,570
2015	409,655
2016	467,703
2017	330,323
2018	336,954
Thereafter	822,454
Total principal payments	2,592,659
Net unamortized premiums/(discounts)	(4,409		)
Outstanding indebtedness	$	2,588,250