Franklin Street Properties Corp. (NYSE American: FSP) is a real estate investment trust (REIT) based in Wakefield, MA, focused on central business district (CBD) and urban-infill office properties located in five markets that are core to us: Atlanta, Dallas, Denver, Houston, and Minneapolis. FSP believes that these five core markets have distinct drivers and advantages that have the potential to generate above average employment and population growth over time. FSP seeks value-oriented investments with an eye towards long-term growth and appreciation, as well as current income. FSP’s primary real estate operations include property acquisitions and dispositions, leasing, development and asset management. FSP began operations in 1997 and became a publicly-traded company in June 2005.
As of September 30, 2018, the Company owned and operated a portfolio of real estate consisting of 34 properties and asset-managed 3 Sponsored REITs. FSP evaluates new potential property investments within our five core markets with an eye towards credible paths to creating value in the near to intermediate term. Additionally, the Company may also pursue, on a selective basis, the sale of certain of its properties in order to take advantage of value creation and strong location-based demand cycles, or for geographic or property specific reasons. FSP management believes that harvesting appreciation gains in its properties represents a meaningful contribution to the total return earned by its investors.
FSP’s investment strategy is to make direct investments in real estate assets. CBD and institutional-quality urban-infill office properties within our core markets of Atlanta, Dallas, Denver, and Houston will be our primary target for investment. The Company believes that real estate, in general, and office properties, specifically, are a cyclical asset class. Accordingly, FSP endeavors to minimize the risk of investing in that cyclical asset class by maintaining a low to moderate level of corporate debt and historically has not had secured debt at the property level. FSP believes that matching a flexible moderate leverage ratio with its office investments will allow it to take advantage of disposition opportunities during peaks in the cycles and protect its investments from foreclosure or refinancing risk during the lows of the cycles. In addition to maintaining modest leverage, FSP believes that it can lower investment risk while enhancing current income and long-term appreciation potential through the geographic diversification offered by its five core markets that exhibit strong economic growth drivers.