860546--3/1/2007--CORPORATE_OFFICE_PROPERTIES

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{investment, property, distribution}

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We may suffer adverse consequences as a result of our reliance on rental revenues for our income. Adverse developments concerning some of our key tenants could have a negative impact on our revenue. We rely on the ability of our tenants to pay rent and would be harmed by their inability to do so. Most of our properties are geographically concentrated in the Mid-Atlantic region, particularly in the Greater Washington, D.C. region and neighboring suburban Baltimore. We may suffer economic harm in the event of a decline in the real estate market or general economic conditions in those regions. We would suffer economic harm if we were unable to renew our leases on favorable terms. We may not be able to compete successfully with other entities that operate in our industry. We may be unable to successfully execute our plans to acquire existing commercial real estate properties. We may suffer economic harm as a result of making unsuccessful acquisitions in new markets. We may be unable to execute our plans to develop and construct additional properties. We may suffer economic harm as a result of the actions of our joint venture partners. We are subject to possible environmental liabilities. Real estate investments are illiquid, and we may not be able to sell our properties on a timely basis when we determine it is appropriate to do so. We are subject to other possible liabilities that would adversely affect our financial position and cash flows. As a result of the September 11, 2001 terrorist attacks, we may be subject to increased costs of insurance and limitations on coverage. We may suffer adverse effects as a result of the indebtedness that we carry and the terms and covenants that relate to this debt. We may be unable to continue to make shareholder distributions at expected levels. Our ownership limits are important factors. Our Declaration of Trust includes other provisions that may prevent or delay a change of control. Our Board of Trustees is divided into three classes of Trustees, which could delay a change of control. The Maryland business statutes also impose potential restrictions on a change of control of our company. Our failure to qualify as a REIT would have adverse tax consequences. We have certain distribution requirements that reduce cash available for other business purposes. A number of factors could cause our security prices to decline. Our ability to pay dividends may be limited, and we cannot assure you that we will be able to pay dividends regularly. Our ability to pay dividends is further limited by the requirements of Maryland law. We may incur additional indebtedness, which may harm our financial position and cash flow and potentially impact our ability to pay dividends on any series of preferred shares. We are dependent on external sources of capital for future growth. Our business and operations would suffer in the event of system failures. Certain of our officers and Trustees have potential conflicts of interest. We are dependent on our key personnel, and the loss of any key personnel could have an adverse effect on our operations. We may change our policies without shareholder approval, which could adversely affect our financial condition, results of operations, market price of our common shares or ability to pay distributions. Compliance with changing regulation of corporate governance and public disclosure may result in additional expenses, affect our operations and affect our reputation.

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860546--3/1/2007--CORPORATE_OFFICE_PROPERTIES_TRUST