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<SEC-DOCUMENT>0001171520-06-000214.txt : 20060522
<SEC-HEADER>0001171520-06-000214.hdr.sgml : 20060522
<ACCEPTANCE-DATETIME>20060522131239
ACCESSION NUMBER:		0001171520-06-000214
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		3
CONFORMED PERIOD OF REPORT:	20060522
ITEM INFORMATION:		Other Events
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20060522
DATE AS OF CHANGE:		20060522

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			FRANKLIN STREET PROPERTIES CORP /MA/
		CENTRAL INDEX KEY:			0001031316
		STANDARD INDUSTRIAL CLASSIFICATION:	REAL ESTATE INVESTMENT TRUSTS [6798]
		IRS NUMBER:				042724223
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-32470
		FILM NUMBER:		06857771

	BUSINESS ADDRESS:	
		STREET 1:		401 EDGEWATER PL
		STREET 2:		STE 200
		CITY:			WAKEFIELD
		STATE:			MA
		ZIP:			01880
		BUSINESS PHONE:		7815571300

	MAIL ADDRESS:	
		STREET 1:		401 EDGEWATER PLACE
		STREET 2:		STE 200
		CITY:			WAKEFIELD
		STATE:			MA
		ZIP:			01880

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	FRANKLIN STREET PARTNERS LP
		DATE OF NAME CHANGE:	20010301
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>eps2133.txt
<DESCRIPTION>FRANKLIN STREET PROPERTIES CORP.
<TEXT>

                                  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): May 22, 2006

                        FRANKLIN STREET PROPERTIES CORP.
               --------------------------------------------------
               (Exact Name of Registrant as Specified in Charter)

            Maryland                 001-32470             04-3578653
     ----------------------         -----------           -------------
     (State or Other Juris-         (Commission           (IRS Employer
    diction of Incorporation)       File Number)        Identification No.)

    401 Edgewater Place, Suite 200, Wakefield MA               01880-6210
      ----------------------------------------                 ----------
      (Address of Principal Executive Offices)                 (Zip Code)

       Registrant's telephone number, including area code: (781) 557-1300


          -------------------------------------------------------------
          (Former Name or Former Address, if Changed Since Last Report)

      Check the appropriate box below 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))

<PAGE>

Item 8.01. Other Events.

      On April 30, 2006, in the sale of an aggregate of 10,971,697 shares of its
common stock exempt from registration pursuant to Section 4(2) of the Securities
Act of 1933 and Rule 506 promulgated thereunder as a transaction not involving a
public offering, Franklin Street Properties Corp. (the "Company") acquired five
real estate investment trusts, as described more fully in the Company's Current
Report on Form 8-K filed with the Securities and Exchange Commission on May 4,
2006. The five real estate investment trusts that the Company acquired were FSP
Willow Bend Office Center Corp., FSP Innsbrook Corp., FSP 380 Interlocken Corp.,
FSP Blue Lagoon Drive Corp. and FSP Eldridge Green Corp. (collectively, the
"Target REITs"). The Company is hereby filing balance sheets as of March 31,
2006 and December 31, 2005 and statements of operations and statements of cash
flows for the three months ended March 31, 2006 and March 31, 2005 for each of
the Target REITs, together with the Company's pro forma balance sheet as of
March 31, 2006 and pro forma statements of income and cash flow for the three
months ended March 31, 2006, each giving effect to the acquisition of the Target
REITs, and comparative per share data for the Company and the Target REITs.


Item 9.01. Financial Statements and Exhibits

      (d)   See Exhibit Index attached hereto.

<PAGE>

                                    SIGNATURE

      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.


                                        FRANKLIN STREET PROPERTIES CORP.

Date: May 22, 2006                      By: /s/ George J. Carter
                                        -------------------------------------
                                        President and Chief Executive Officer

<PAGE>

                                  EXHIBIT INDEX

Exhibit No.             Description
- -----------             -----------

99.1**                  Financial Statements of FSP Willow Bend Office Center
                        Corp., FSP Innsbrook Corp., FSP 380 Interlocken Corp.,
                        FSP Blue Lagoon Drive Corp., and FSP Eldridge Green
                        Corp.

99.2**                  Pro Forma Financial Information of Franklin Street
                        Properties Corp.

** Filed herewith.

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>ex99-1.txt
<TEXT>

                                                                    Exhibit 99.1


                          Index to Financial Statements

                                                                            Page
                                                                            ----

FSP Willow Bend Office Center Corp.

Index to financial statements quarterly report as of March 31, 2006 .......  F-2


FSP Innsbrook Corp.

Index to financial statements quarterly report as of March 31, 2006 .......  F-8


FSP 380 Interlocken Corp.

Index to financial statements quarterly report as of March 31, 2006 ....... F-14


FSP Blue Lagoon Drive Corp.

Index to financial statements quarterly report as of March 31, 2006 ....... F-20


FSP Eldridge Green Corp.

Index to financial statements quarterly report as of March 31, 2006 ....... F-26


                                      F-1
<PAGE>

                       FSP Willow Bend Office Center Corp.
                          Index to Financial Statements

                                Quarterly Report
                                 March 31, 2006

                                Table of Contents

                                                                            Page

Financial Statements

      Balance Sheets as of March 31, 2006 and December 31, 2005..........    F-3

      Statements of Operations for the three months ended March 31, 2006
      and 2005...........................................................    F-4

      Statements of Cash Flows for the three months ended March 31, 2006
      and 2005...........................................................    F-5

      Notes to Financial Statements......................................    F-6


                                      F-2
<PAGE>

                       FSP Willow Bend Office Center Corp.
                                 Balance Sheets
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                  March 31,     December 31,
(in thousands,except shares and par value amounts)                   2006           2005
============================================================================================

<S>                                                                <C>            <C>
Assets:

Real estate investments, at cost:
     Land                                                          $  2,737       $  2,737
     Buildings and improvements                                      15,497         15,497
- --------------------------------------------------------------------------------------------
                                                                     18,234         18,234
                                                                         --
     Less accumulated depreciation                                    2,232          2,095
- --------------------------------------------------------------------------------------------

Real estate investments, net                                         16,002         16,139

Cash and cash equivalents                                               460            677
Cash-funded reserves                                                  1,041          1,041
Restricted cash                                                         129            129
Tenant rent receivable                                                   38             47
Step rent receivable                                                    486            509
Deferred leasing costs, net of accumulated amortization
      of $259 and $228, respectively                                    325            356
Prepaid expenses and other assets                                        15             23
- --------------------------------------------------------------------------------------------

      Total assets                                                 $ 18,496       $ 18,921
============================================================================================

Liabilities and Stockholders' Equity:

Liabilities:
Accounts payable and accrued expenses                              $    275       $    433
Tenant security deposits                                                129            129
- --------------------------------------------------------------------------------------------

     Total liabilities                                                  404            562
- --------------------------------------------------------------------------------------------

Commitments and Contingencies:                                           --             --

Stockholders' Equity:
     Preferred Stock, $.01 par value, 206 shares
       authorized, issued and outstanding                                --             --

     Common Stock, $.01 par value, 1 share
        authorized, issued and outstanding                               --             --
     Additional paid-in capital                                      18,900         18,900
     Retained deficit and distributions in excess of earnings          (808)          (541)
- --------------------------------------------------------------------------------------------

     Total Stockholders' Equity                                      18,092         18,359
- --------------------------------------------------------------------------------------------

     Total Liabilities and Stockholders' Equity                    $ 18,496       $ 18,921
============================================================================================
</TABLE>


                 See accompanying notes to financial statements.


                                      F-3
<PAGE>

                       FSP Willow Bend Office Center Corp.
                            Statements of Operations
                                   (unaudited)

                                                            For the Three Months
                                                               Ended March 31,
                                                           ---------------------
(in thousands, except shares and per share amounts)          2006        2005
================================================================================

Revenues:
     Rental                                                 $  569      $  463
- --------------------------------------------------------------------------------

        Total revenue                                          569         463
- --------------------------------------------------------------------------------

Expenses:

     Rental operating expenses                                 206         217
     Real estate taxes and insurance                            97         101
     General and administrative                                 74          --
     Depreciation and amortization                             168         166
- --------------------------------------------------------------------------------

       Total expenses                                          545         484
- --------------------------------------------------------------------------------

Income (loss) before interest income                            24         (21)

Interest income                                                 12          11
- --------------------------------------------------------------------------------

Net income (loss) attributable to preferred stockholders    $   36      $  (10)
================================================================================

Weighted average number of preferred shares outstanding,
    basic and diluted                                          206         206
================================================================================

Net income (loss) per preferred share, basic and diluted    $  175      $  (49)
================================================================================

                 See accompanying notes to financial statements.


                                      F-4
<PAGE>

                       FSP Willow Bend Office Center Corp.
                            Statements of Cash Flows
                                   (unaudited)

                                                            For the Three Months
                                                               Ended March 31,
                                                            --------------------
(in thousands)                                                2006        2005
================================================================================

Cash flows from operating activities:
     Net income (loss)                                       $  36       $ (10)
     Adjustments to reconcile net income to net cash
         provided by operating activities:
              Depreciation and amortization                    168         166
           Changes in operating assets and liabilities:
              Cash-funded reserves                              --          21
              Restricted cash                                   --          57
              Tenant rent receivable                             9          (1)
              Step rent receivable                              23           5
              Prepaid expenses and other assets                  8          (1)
              Accounts payable and accrued expenses           (158)        (99)
              Tenant security deposits                          --         (57)
              Payment of deferred leasing costs                 --          (1)
- --------------------------------------------------------------------------------

                 Net cash provided by operating activities      86          80
- --------------------------------------------------------------------------------

Cash flows from investing activities (none):
- --------------------------------------------------------------------------------

Cash flows from financing activities:
     Distributions to stockholders                            (303)       (273)
- --------------------------------------------------------------------------------

                 Net cash used for financing activities       (303)       (273)
- --------------------------------------------------------------------------------

Net decrease in cash and cash equivalents                     (217)       (193)

Cash and cash equivalents, beginning of year                   677         621
- --------------------------------------------------------------------------------

Cash and cash equivalents, end of year                       $ 460       $ 428
================================================================================


                 See accompanying notes to financial statements.


                                      F-5
<PAGE>

                       FSP Willow Bend Office Center Corp.
                          Notes to Financial Statements
                                   (unaudited)

1. Organization, Properties, Basis of Presentation and Recent Accounting
Pronouncements Organization

FSP Willow Bend Office Center Corp. (the "Company") was organized on December
13, 2000 as a corporation under the laws of the State of Delaware to purchase,
own and operate a commercial building located in Plano, Texas (the "Property").
The Property consists of a two-story office building containing 116,600 total
square feet of space situated on approximately 7 acres of land. The Company
acquired the Property on December 15, 2000 and will operate in a manner intended
to qualify as a real estate investment trust ("REIT") for federal income tax
purposes.

On March 15, 2006, the Company entered into a merger agreement with its common
shareholder, Franklin Street Properties Corp ("FSP"). On March 31, 2006, FSP
sent the Company's shareholders a Consent Solicitation/Offering Memorandum
indicating its intent to merge the Company and four additional REITs with and
into five of FSP's wholly-owned subsidiaries. The merger required the approval
of a majority of the shareholders of the Company as well as a majority of the
shareholders of the four additional REITs. The Company completed the merger on
April 30, 2006 and FSP issued approximately 983,763 shares of its common stock
in exchange for a 100% ownership interest in the Company. The Company has
incurred approximately $74,000 of costs through March 31, 2006, related to the
merger and these costs have been included as an expense in the Statements of
Operations.

Basis of Presentation

The accompanying interim financial statements are unaudited; however, the
financial statements have been prepared in accordance with accounting principles
generally accepted in the United States of America ("GAAP") for interim
financial information and in conjunction with the rules and regulations of the
Securities and Exchange Commission. Accordingly, they do not include all of the
disclosures required by accounting principles generally accepted in the United
States of America for complete financial statements. In the opinion of
management, all adjustments (consisting solely of normal recurring matters)
necessary for a fair presentation of the financial statements for these interim
periods have been included.

These financial statements should be read in conjunction with the Company's
financial statements and notes thereto for its fiscal year ended December 31,
2005.

Estimates and Assumptions

The Company prepares its financial statements and related notes in conformity
with GAAP. These principles require management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenue and expenses during the reporting period. Actual
results could differ from those estimates.

2. Net Income Per Share

Basic net income per share is computed by dividing net income by the weighted
average number of Company shares outstanding during the period. Diluted net
income per share reflects the potential dilution that could occur if securities
or other contracts to issue shares were exercised or converted into shares.
There were no potential dilutive shares outstanding at March 31, 2006 and 2005.

3. Income Taxes

The Company has elected to be taxed as a REIT under the Internal Revenue Code of
1986, as amended (the "Code"). As a REIT, the Company generally is entitled to a
tax deduction for dividends paid to its shareholders, thereby effectively
subjecting the distributed net income of the Company to taxation at the
shareholder level only. The Company must comply with a variety of restrictions
to maintain its status as a REIT. These restrictions include the type of income
it can earn, the type of assets it can hold, the number of shareholders it can
have and the concentration of their ownership, and the amount of the Company's
income that must be distributed annually.


                                      F-6
<PAGE>

                       FSP Willow Bend Office Center Corp.
                          Notes to Financial Statements
                                   (unaudited)

4. Related Party Transactions

The Company executed a management agreement with FSP Property Management LLC, an
affiliate of FSP, that provides for a management fee equal to 1% of collected
revenues and is cancelable with 30 days notice by either party. Fees incurred
under the agreement were $7,000 and $5,000 for the three months ended March 31,
2006 and 2005, respectively.

5. Cash Distributions

The Company's cash distributions for the three months ended March 31, 2006 and
2005 are as follows:

Quarter Paid                                             2006           2005
- ------------------------------------------------        -------        ------
(in thousands)
First Quarter                                           $  303         $  273

6. Subsequent Events

The Company declared a cash distribution of $304,742 on April 17, 2006 to
stockholders of record on April 28, 2006 payable on May 19, 2006.

On April 30, 2006, the Company completed the merger with FSP along with the
additional four REITs pursuant to the Agreement and Plan of Merger, dated March
15, 2006.


                                      F-7
<PAGE>

                               FSP Innsbrook Corp.
                              Financial Statements

                                Quarterly Report
                                 March 31, 2006

                                Table of Contents

                                                                            Page
                                                                            ----

Financial Statements

      Balance Sheets as of March 31, 2006 and December 31, 2005..........    F-9

      Statements of Operations for the three months ended March 31, 2006
      and 2005...........................................................   F-10

      Statements of Cash Flows for the three months ended March 31, 2006
      and 2005...........................................................   F-11

      Notes to Financial Statements......................................   F-12


                                      F-8
<PAGE>

                               FSP Innsbrook Corp.
                                 Balance Sheets
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                   March 31,     December 31,
(in thousands, except shares and par value amounts)                  2006           2005
=============================================================================================

<S>                                                                <C>            <C>
Assets:

Real estate investments, at cost:
     Land                                                          $  3,643       $  3,643
     Buildings and improvements                                      33,737         33,737
- ---------------------------------------------------------------------------------------------
                                                                     37,380         37,380

     Less accumulated depreciation                                    2,343          2,126
- ---------------------------------------------------------------------------------------------

Real estate investments, net                                         35,037         35,254

Acquired real estate leases, net of accumulated amortization
      of $545 and $494, respectively                                    730            781
Deferred leasing costs, net of accumulated amortization
      of $0 and $0, respectively                                        447             --
Cash and cash equivalents                                             1,101          1,469
Cash-funded reserves                                                  1,744          2,191
Step rent receivable                                                    327            310
Prepaid expenses and other assets                                        87            109
- ---------------------------------------------------------------------------------------------

      Total assets                                                 $ 39,473       $ 40,114
=============================================================================================

Liabilities and Stockholders' Equity:

Liabilities:
Accounts payable and accrued expenses                              $    302       $    646
- ---------------------------------------------------------------------------------------------

     Total liabilities                                                  302            646
- ---------------------------------------------------------------------------------------------

Commitments and Contingencies:                                           --             --

Stockholders' Equity:
     Preferred Stock, $.01 par value, 475 shares
       authorized, issued and outstanding                                --             --

     Common Stock, $.01 par value, 1 share
       authorized, issued and outstanding                                --             --
     Additional paid-in capital                                      43,607         43,607
     Retained deficit and distributions in excess of earnings        (4,436)        (4,139)
- ---------------------------------------------------------------------------------------------

     Total Stockholders' Equity                                      39,171         39,468
- ---------------------------------------------------------------------------------------------

     Total Liabilities and Stockholders' Equity                    $ 39,473       $ 40,114
=============================================================================================
</TABLE>


                 See accompanying notes to financial statements.


                                      F-9
<PAGE>

                               FSP Innsbrook Corp.
                            Statements of Operations
                                   (unaudited)

                                                            For the Three Months
                                                               Ended March 31,
                                                            --------------------
(in thousands, except shares and per share amounts)           2006        2005
================================================================================

Revenues:
     Rental                                                  $1,396      $1,454
- --------------------------------------------------------------------------------

       Total revenue                                          1,396       1,454
- --------------------------------------------------------------------------------

Expenses:

     Rental operating expenses                                  296         408
     Real estate taxes and insurance                             90         103
     Depreciation and amortization                              268         267
     General and administrative                                 132          --
- --------------------------------------------------------------------------------

       Total expenses                                           786         778
- --------------------------------------------------------------------------------

Income before interest income                                   610         676

Interest income                                                  27          16
- --------------------------------------------------------------------------------

Net income attributable to preferred stockholders            $  637      $  692
================================================================================

Weighted average number of preferred shares outstanding,
     basic and diluted                                          475         475
================================================================================

Net income per preferred share, basic and diluted            $1,341      $1,457
================================================================================


                 See accompanying notes to financial statements.


                                      F-10
<PAGE>

                               FSP Innsbrook Corp.
                            Statements of Cash Flows
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                  For the Three Months
                                                                     Ended March 31,
                                                                 ----------------------
(in thousands)                                                     2006          2005
========================================================================================

<S>                                                              <C>           <C>
Cash flows from operating activities:
     Net Income                                                  $   637       $   692
     Adjustments to reconcile net income to net cash
          provided by operating activities:
              Depreciation and amortization                          268           267
          Changes in operating assets and liabilities:
              Cash-funded reserves                                   447            --
              Tenant rent receivable                                  --           (13)
              Step rent receivable                                   (17)          (27)
              Prepaid expenses and other assets                       22            15
              Accounts payable and accrued expenses                 (344)         (407)
              Payment of deferred leasing costs                     (447)           --
- ----------------------------------------------------------------------------------------

                  Net cash provided by operating activities          566           527
- ----------------------------------------------------------------------------------------

Cash flows from investing activities (none):
- ----------------------------------------------------------------------------------------

Cash flows from financing activities:
     Distributions to stockholders                                  (934)         (903)
- ----------------------------------------------------------------------------------------

                  Net cash used for financing activities            (934)         (903)
- ----------------------------------------------------------------------------------------

Net decrease in cash and cash equivalents                           (368)         (376)

Cash and cash equivalents, beginning of period                     1,469         1,392
- ----------------------------------------------------------------------------------------

Cash and cash equivalents, end of period                         $ 1,101       $ 1,016
========================================================================================
</TABLE>


                 See accompanying notes to financial statements.


                                      F-11
<PAGE>

                               FSP Innsbrook Corp.
                          Notes to Financial Statements
                                   (unaudited)

Organization

FSP Innsbrook Corp. (the "Company") was organized on May 14, 2003 as a
corporation under the laws of the State of Delaware to purchase, own and operate
three recently constructed Class "A" suburban office buildings containing
approximately 297,789 square feet of rentable space located on approximately 17
acres of land in Glen Allen, Henrico County, VA. (the "Property"). The Company
acquired the Property on July 16, 2003 and will operate in a manner intended to
qualify as a real estate investment trust ("REIT") for federal income tax
purposes.

On March 15, 2006, the Company entered into a merger agreement with its common
shareholder, Franklin Street Properties Corp ("FSP"). On March 31, 2006, FSP
sent the Company's shareholders a Consent Solicitation/Offering Memorandum
indicating its intent to merge the Company and four additional REITs with and
into five of FSP's wholly-owned subsidiaries. The merger required the approval
of a majority of the shareholders of the Company as well as a majority of the
shareholders of the four additional REITs. The Company completed the merger on
April 30, 2006 and FSP issued approximately 2,387,775 shares of its common stock
in exchange for a 100% ownership interest in the Company. The Company has
incurred approximately $132,000 of costs through March 31, 2006, related to the
merger and these costs have been included as an expense in the Statements of
Operations.

Basis of Presentation

The accompanying interim financial statements are unaudited; however, the
financial statements have been prepared in accordance with accounting principles
generally accepted in the United States of America ("GAAP") for interim
financial information and in conjunction with the rules and regulations of the
Securities and Exchange Commission. Accordingly, they do not include all of the
disclosures required by accounting principles generally accepted in the United
States of America for complete financial statements. In the opinion of
management, all adjustments (consisting solely of normal recurring matters)
necessary for a fair presentation of the financial statements for these interim
periods have been included.

These financial statements should be read in conjunction with the Company's
financial statements and notes thereto for its fiscal year ended December 31,
2005.

Estimates and Assumptions

The Company prepares its financial statements and related notes in conformity
with GAAP. These principles require management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenue and expenses during the reporting period. Actual
results could differ from those estimates.

2. Net Income Per Share

Basic net income per share is computed by dividing net income by the weighted
average number of Company shares outstanding during the period. Diluted net
income per share reflects the potential dilution that could occur if securities
or other contracts to issue shares were exercised or converted into shares.
There were no potential dilutive shares outstanding at March 31, 2006 and 2005.

3. Income Taxes

The Company has elected to be taxed as a REIT under the Internal Revenue Code of
1986, as amended (the "Code"). As a REIT, the Company generally is entitled to a
tax deduction for dividends paid to its shareholders, thereby effectively
subjecting the distributed net income of the Company to taxation at the
shareholder level only. The Company must comply with a variety of restrictions
to maintain its status as a REIT. These restrictions include the type of income
it can earn, the type of assets it can hold, the number of shareholders it can
have and the concentration of their ownership, and the amount of the Company's
income that must be distributed annually.


                                      F-12
<PAGE>

                               FSP Innsbrook Corp.
                          Notes to Financial Statements
                                   (unaudited)

4. Related Party Transactions

The Company executed a management agreement with FSP Property Management LLC, an
affiliate of FSP, that provides for a management fee equal to 1% of collected
revenues and is cancelable with 30 days notice by either party. Fees incurred
under the agreement were $13,000 and $14,000 for the three months ended March
31, 2006 and 2005, respectively.

5. Cash Distributions

The Company's cash distributions for the three months ended March 31, 2006 and
2005 are as follows:

Quarter Paid                                                2006           2005
- --------------------------------------------------         ------         ------
(in thousands)
First Quarter                                              $  934         $  903

6. Subsequent Events

The Company declared a cash distribution of $483,184 on April 17, 2006 to
stockholders of record on April 28, 2006 payable on May 19, 2006.

On April 30, 2006, the Company completed the merger with FSP along with the
additional four REITs pursuant to the Agreement and Plan of Merger, dated March
15, 2006.


                                      F-13
<PAGE>

                            FSP 380 Interlocken Corp.
                              Financial Statements

                                Quarterly Report
                                 March 31, 2006

                                Table of Contents

                                                                            Page
                                                                            ----

Financial Statements

      Balance Sheets as of March 31, 2006 and December 31, 2005..........   F-15

      Statements of Operations for the three months ended March 31, 2006
      and 2005...........................................................   F-16

      Statements of Cash Flows for the three months ended March 31, 2006
      and 2005...........................................................   F-17

      Notes to Financial Statements......................................   F-18


                                      F-14
<PAGE>

                            FSP 380 Interlocken Corp.
                                 Balance Sheets
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                             March 31,     December 31,
(in thousands,except shares and par value amounts)                             2006           2005
=======================================================================================================

<S>                                                                          <C>            <C>
Assets:

Real estate investments, at cost:
     Land                                                                    $  5,287       $  5,287
     Buildings and improvements                                                27,231         27,223
- -------------------------------------------------------------------------------------------------------
                                                                               32,518         32,510

     Less accumulated depreciation                                              1,860          1,686
- -------------------------------------------------------------------------------------------------------

Real estate investments, net                                                   30,658         30,824

Acquired real estate leases, net of accumulated amortization
      of $663 and $601, respectively                                              290            352
Acquired favorable real estate leases, net of accumulated  amortization
      of $3,478 and $3,152, respectively                                        1,522          1,848
Deferred leasing costs, net of accumulated amortization
      of $2 and $1, respectively                                                    9              8
Cash and cash equivalents                                                       1,800          2,204
Cash-funded reserves                                                            2,820          2,830
Restricted cash                                                                    49             39
Tenant rent receivable                                                            240            242
Step rent receivable                                                              242            247
Prepaid expenses and other assets                                                  83            104
- -------------------------------------------------------------------------------------------------------

      Total assets                                                           $ 37,713       $ 38,698
=======================================================================================================

Liabilities and Stockholders' Equity:

Liabilities:
Accounts payable and accrued expenses                                        $  1,121       $  1,309
Tenant security deposits                                                           49             39
- -------------------------------------------------------------------------------------------------------

     Total liabilities                                                          1,170          1,348
- -------------------------------------------------------------------------------------------------------

Commitments and Contingencies:                                                     --             --

Stockholders' Equity:
     Preferred Stock, $.01 par value, 480 shares
        authorized, issued and outstanding                                         --             --

     Common Stock, $.01 par value, 1 share
        authorized, issued and outstanding                                         --             --
     Additional paid-in capital                                                44,092         44,092
     Retained deficit and distributions in excess of earnings                  (7,549)        (6,742)
- -------------------------------------------------------------------------------------------------------

     Total Stockholders' Equity                                                36,543         37,350
- -------------------------------------------------------------------------------------------------------

     Total Liabilities and Stockholders' Equity                              $ 37,713       $ 38,698
=======================================================================================================
</TABLE>


                 See accompanying notes to financial statements.


                                      F-15
<PAGE>

                            FSP 380 Interlocken Corp.
                            Statements of Operations
                                   (unaudited)

                                                            For the Three Months
(in thousands, except shares and per share amounts)            Ended March 31,
                                                            --------------------
                                                             2006        2005
================================================================================

Revenues:
     Rental                                                 $1,417      $1,502
- --------------------------------------------------------------------------------

       Total revenue                                         1,417       1,502
- --------------------------------------------------------------------------------

Expenses:

     Rental operating expenses                                 438         330
     Real estate taxes and insurance                           300         292
     Depreciation and amortization                             237         236
     General and administrative                                134          --
- --------------------------------------------------------------------------------

       Total expenses                                        1,109         858
- --------------------------------------------------------------------------------

Income before interest income                                  308         644

Interest income                                                 53          25
- --------------------------------------------------------------------------------

Net income attributable to preferred stockholders           $  361      $  669
================================================================================

Weighted average number of preferred shares outstanding,
     basic and diluted                                         480         480
================================================================================

Net income per preferred share, basic and diluted           $  752      $1,394
================================================================================


                 See accompanying notes to financial statements.


                                      F-16
<PAGE>

                            FSP 380 Interlocken Corp.
                            Statements of Cash Flows
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                 For the Three Months
                                                                    Ended March 31,
                                                                ----------------------
(in thousands)                                                    2006          2005
======================================================================================

<S>                                                             <C>           <C>
Cash flows from operating activities:
     Net income                                                 $   361       $   669
     Adjustments to reconcile net income to net cash
         provided by operating activities:
             Depreciation and amortization                          237           236
             Amortization of favorable lease                        326           326
          Changes in operating assets and liabilities:
             Cash-funded reserves                                    10            --
             Restricted cash                                        (10)           --
             Tenant rent receivable                                   2          (116)
             Step rent receivable                                     5           (17)
             Prepaid expenses and other assets                       21            22
             Accounts payable and accrued expenses                 (188)         (274)
             Tenant security deposits                                10            --
             Payment of deferred leasing costs                       (2)           --

- --------------------------------------------------------------------------------------

                 Net cash provided by operating activities          772           846
- --------------------------------------------------------------------------------------

Cash flows from investing activities:
     Purchase of real estate assets                                  (8)           --
- --------------------------------------------------------------------------------------

                 Net cash used for investing activities              (8)           --
- --------------------------------------------------------------------------------------

Cash flows from financing activities:
     Distributions to stockholders                               (1,168)       (1,161)
- --------------------------------------------------------------------------------------

                 Net cash used for financing activities          (1,168)       (1,161)
- --------------------------------------------------------------------------------------

Net decrease in cash and cash equivalents                          (404)         (315)

Cash and cash equivalents, beginning of period                    2,204         2,275
- --------------------------------------------------------------------------------------

Cash and cash equivalents, end of period                        $ 1,800       $ 1,960
======================================================================================
</TABLE>


                 See accompanying notes to financial statements.


                                      F-17
<PAGE>

                            FSP 380 Interlocken Corp.
                          Notes to Financial Statements
                                   (unaudited)

Organization

FSP 380 Interlocken Corp. (the "Company") was organized on June 24, 2003 as a
corporation under the laws of the State of Delaware to purchase, own and operate
a ten-story, multi-tenant Class "A" suburban office tower containing
approximately 240,184 square feet of rentable space located on approximately 13
acres of land in Broomfield, CO (the "Property"). The company acquired the
Property on August 15, 2003.

On March 15, 2006, the Company entered into a merger agreement with its common
shareholder, Franklin Street Properties Corp ("FSP"). On March 31, 2006, FSP
sent the Company's shareholders a Consent Solicitation/Offering Memorandum
indicating its intent to merge the Company and four additional REITs with and
into five of FSP's wholly-owned subsidiaries. The merger required the approval
of a majority of the shareholders of the Company as well as a majority of the
shareholders of the four additional REITs. The Company completed the merger on
April 30, 2006 and FSP issued approximately 2,406,877 shares of its common stock
in exchange for a 100% ownership interest in the Company. The Company has
incurred approximately $134,000 of costs through March 31, 2006, related to the
merger and these costs have been included as an expense in the Statements of
Operations.

Basis of Presentation

The accompanying interim financial statements are unaudited; however, the
financial statements have been prepared in accordance with accounting principles
generally accepted in the United States of America ("GAAP") for interim
financial information and in conjunction with the rules and regulations of the
Securities and Exchange Commission. Accordingly, they do not include all of the
disclosures required by accounting principles generally accepted in the United
States of America for complete financial statements. In the opinion of
management, all adjustments (consisting solely of normal recurring matters)
necessary for a fair presentation of the financial statements for these interim
periods have been included.

These financial statements should be read in conjunction with the Company's
financial statements and notes thereto for its fiscal year ended December 31,
2005.

Estimates and Assumptions

The Company prepares its financial statements and related notes in conformity
with GAAP. These principles require management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenue and expenses during the reporting period. Actual
results could differ from those estimates.

2. Net Income Per Share

Basic net income per share is computed by dividing net income by the weighted
average number of Company shares outstanding during the period. Diluted net
income per share reflects the potential dilution that could occur if securities
or other contracts to issue shares were exercised or converted into shares.
There were no potential dilutive shares outstanding at March 31, 2006 and 2005.

3. Income Taxes

The Company has elected to be taxed as a REIT under the Internal Revenue Code of
1986, as amended (the "Code"). As a REIT, the Company generally is entitled to a
tax deduction for dividends paid to its shareholders, thereby effectively
subjecting the distributed net income of the Company to taxation at the
shareholder level only. The Company must comply with a variety of restrictions
to maintain its status as a REIT. These restrictions include the type of income
it can earn, the type of assets it can hold, the number of shareholders it can
have and the concentration of their ownership, and the amount of the Company's
income that must be distributed annually.


                                      F-18
<PAGE>

                            FSP 380 Interlocken Corp.
                          Notes to Financial Statements
                                   (unaudited)

4. Related Party Transactions

The Company executed a management agreement with FSP Property Management LLC, an
affiliate of FSP, that provides for a management fee equal to 1% of collected
revenues and is cancelable with 30 days notice by either party. Fees incurred
under the agreement were $18,000 and for the three months ended March 31, 2006
and 2005.

5. Cash Distributions

The Company's cash distributions for the three months ended March 31, 2006 and
2005 are as follows:

Quarter Paid                                          2006                 2005
- --------------------------------------               ------               ------
(in thousands)
First Quarter                                        $1,168               $1,161

6. Subsequent Events

The Company declared a cash distribution of $994,032 on April 17, 2006 to
stockholders of record on April 28, 2006 payable on May 19, 2006.

On April 30, 2006, the Company completed the merger with FSP along with the
additional four REITs pursuant to the Agreement and Plan of Merger, dated March
15, 2006.


                                      F-19
<PAGE>

                           FSP Blue Lagoon Drive Corp.
                              Financial Statements

                                Quarterly Report
                                 March 31, 2006

                                Table of Contents

                                                                            Page
                                                                            ----

Financial Statements

      Balance Sheets as of March 31, 2006 and December 31, 2005..........   F-21

      Statements of Operations for the three months ended March 31, 2006
      and 2005...........................................................   F-22

      Statements of Cash Flows for the three months ended March 31, 2006
      and 2005...........................................................   F-23

      Notes to Financial Statements......................................   F-24


                                      F-20
<PAGE>

                           FSP Blue Lagoon Drive Corp.
                                 Balance Sheets
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                  March 31,     December 31,
(in thousands, except shares and par value amounts)                 2006           2005
============================================================================================

<S>                                                               <C>            <C>
Assets:

Real estate investments, at cost:
     Land                                                         $  5,463       $  5,463
     Buildings and improvements                                     41,684         41,684
- --------------------------------------------------------------------------------------------
                                                                    47,147         47,147

     Less accumulated depreciation                                   2,583          2,316
- --------------------------------------------------------------------------------------------

Real estate investments, net                                        44,564         44,831

Acquired real estate leases, net of accumulated amortization
      of $894 and $801 respectively                                    523            616
Cash and cash equivalents                                            1,798          1,659
Cash-funded reserves                                                 2,982          2,982
Step rent receivable                                                   301            304
Prepaid expenses and other assets                                       33             41
- --------------------------------------------------------------------------------------------

      Total assets                                                $ 50,201       $ 50,433
============================================================================================

Liabilities and Stockholders' Equity:

Liabilities:
Accounts payable and accrued expenses                             $    765       $    502
- --------------------------------------------------------------------------------------------

     Total liabilities                                                 765            502
============================================================================================

Commitments and Contingencies:                                          --             --

Stockholders' Equity:
     Preferred Stock, $.01 par value, 599 shares
        authorized, issued and outstanding                              --             --

     Common Stock, $.01 par value, 1 share
        authorized, issued and outstanding                              --             --
     Additional paid-in capital                                     55,035         55,035
     Retained deficit and dividends in excess of earnings           (5,599)        (5,104)
- --------------------------------------------------------------------------------------------

     Total Stockholders' Equity                                     49,436         49,931
- --------------------------------------------------------------------------------------------

     Total Liabilities and Stockholders' Equity                   $ 50,201       $ 50,433
============================================================================================
</TABLE>


                 See accompanying notes to financial statements.


                                      F-21
<PAGE>

                           FSP Blue Lagoon Drive Corp.
                            Statements of Operations
                                   (unaudited)

                                                           For the Three Months
                                                              Ended March 31,
                                                           ---------------------
(in thousands, except shares and per share amounts)          2006        2005
================================================================================

Revenues:
     Rental                                                $1,351      $1,332
- --------------------------------------------------------------------------------

       Total revenue                                        1,351       1,332
- --------------------------------------------------------------------------------

Expenses:

     Rental operating expenses                                 88          69
     Real estate taxes and insurance                          164         160
     Depreciation and amortization                            360         360
     General and administrative                               163          --
- --------------------------------------------------------------------------------

       Total expenses                                         775         589
- --------------------------------------------------------------------------------

Income before interest income                                 576         743

Interest income                                                61          28
- --------------------------------------------------------------------------------

Net income attributable to preferred stockholders          $  637      $  771
================================================================================

Weighted average number of preferred shares
      outstanding, basic and diluted                          599         599
================================================================================

Net income per preferred share, basic and diluted          $1,063      $1,287
================================================================================


                 See accompanying notes to financial statements.


                                      F-22
<PAGE>

                           FSP Blue Lagoon Drive Corp.
                            Statements of Cash Flows
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                  For the Three Months
                                                                     Ended March 31,
                                                                 -----------------------
(in thousands)                                                     2006          2005
========================================================================================

<S>                                                              <C>           <C>
Cash flows from operating activities:
     Net income                                                  $    637      $    771
     Adjustments to reconcile net income to net cash
         provided by operating activities:
              Depreciation and amortization                           360           360
           Changes in operating assets and liabilities:
              Step rent receivable                                      3           (14)
              Prepaid expenses and other assets                         8            18
              Accounts payable and accrued expenses                   263           121
- ----------------------------------------------------------------------------------------
                  Net cash provided by operating activities         1,271         1,256
- ----------------------------------------------------------------------------------------

Cash flows from investing activities (none):
- ----------------------------------------------------------------------------------------

Cash flows from financing activities:
     Distributions to stockholders                                 (1,132)       (1,099)
- ----------------------------------------------------------------------------------------

                  Net cash used for financing activities           (1,132)       (1,099)
- ----------------------------------------------------------------------------------------

Net increase in cash and cash equivalents                             139           157

Cash and cash equivalents, beginning of period                      1,659         1,294
- ----------------------------------------------------------------------------------------

Cash and cash equivalents, end of period                         $  1,798      $  1,451
========================================================================================
</TABLE>


                 See accompanying notes to financial statements.


                                      F-23
<PAGE>

                           FSP Blue Lagoon Drive Corp.
                          Notes to Financial Statements
                                   (unaudited)

Organization, Properties, Basis of Presentation and Recent Accounting
Pronouncements

Organization

FSP Blue Lagoon Drive Corp. (the "Company") was organized on September 3, 2003
as a corporation under the laws of the State of Delaware to purchase, own and
operate a nine-story Class "A" suburban office building containing approximately
212,619 rental square feet of space located on approximately 5 acres of land in
Miami-Dade County, FL (the "Property"). The Company acquired the Property on
November 6, 2003.

On March 15, 2006, the Company entered into a merger agreement with its common
shareholder, Franklin Street Properties Corp ("FSP"). On March 31, 2006, FSP
sent the Company's shareholders a Consent Solicitation/Offering Memorandum
indicating its intent to merge the Company and four additional REITs with and
into five of FSP's wholly-owned subsidiaries. The merger required the approval
of a majority of the shareholders of the Company as well as a majority of the
shareholders of the four additional REITs. The Company completed the merger on
April 30, 2006 and FSP issued approximately 2,625,358 shares of its common stock
in exchange for a 100% ownership interest in the Company. The Company has
incurred approximately $163,000 of costs through March 31, 2006, related to the
merger and these costs have been included as an expense in the Statements of
Operations.

Basis of Presentation

The accompanying interim financial statements are unaudited; however, the
financial statements have been prepared in accordance with accounting principles
generally accepted in the United States of America ("GAAP") for interim
financial information and in conjunction with the rules and regulations of the
Securities and Exchange Commission. Accordingly, they do not include all of the
disclosures required by accounting principles generally accepted in the United
States of America for complete financial statements. In the opinion of
management, all adjustments (consisting solely of normal recurring matters)
necessary for a fair presentation of the financial statements for these interim
periods have been included.

These financial statements should be read in conjunction with the Company's
financial statements and notes thereto for its fiscal year ended December 31,
2005.

Estimates and Assumptions

The Company prepares its financial statements and related notes in conformity
with GAAP. These principles require management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenue and expenses during the reporting period. Actual
results could differ from those estimates.

2. Net Income Per Share

Basic net income per share is computed by dividing net income by the weighted
average number of Company shares outstanding during the period. Diluted net
income per share reflects the potential dilution that could occur if securities
or other contracts to issue shares were exercised or converted into shares.
There were no potential dilutive shares outstanding at March 31, 2006 and 2005.

3. Income Taxes

The Company has elected to be taxed as a REIT under the Internal Revenue Code of
1986, as amended (the "Code"). As a REIT, the Company generally is entitled to a
tax deduction for dividends paid to its shareholders, thereby effectively
subjecting the distributed net income of the Company to taxation at the
shareholder level only. The Company must comply with a variety of restrictions
to maintain its status as a REIT. These restrictions include the type of income
it can earn, the type of assets it can hold, the number of shareholders it can
have and the concentration of their ownership, and the amount of the Company's
income that must be distributed annually.


                                      F-24
<PAGE>

                           FSP Blue Lagoon Drive Corp.
                          Notes to Financial Statements
                                   (unaudited)

4. Related Party Transactions

The Company executed a management agreement with FSP Property Management LLC, an
affiliate of FSP, that provides for a management fee equal to 1% of collected
revenues and is cancelable with 30 days notice by either party. Fees incurred
under the agreement were $14,000 and $13,000 for the three months ended March
31, 2006 and 2005, respectively.

5. Cash Distributions

The Company's cash distributions for the three months ended March 31, 2006 and
2005 are as follows:

Quarter Paid                                          2006                 2005
- --------------------------------------               ------               ------
(in thousands)
First Quarter                                        $1,132               $1,099

6. Subsequent Events

The Company declared a cash distribution of $1,149,146 on April 17, 2006 to
stockholders of record on April 28, 2006 payable on May 19, 2006.

On April 30, 2006, the Company completed the merger with FSP along with the
additional four REITs pursuant to the Agreement and Plan of Merger, dated March
15, 2006.


                                      F-25
<PAGE>

                            FSP Eldridge Green Corp.
                              Financial Statements

                                Quarterly Report
                                 March 31, 2006

                                Table of Contents

                                                                            Page
                                                                            ----

Financial Statements

      Balance Sheets as of March 31, 2006 and December 31, 2005..........   F-27

      Statements of Operations for the three months ended March 31, 2006
      and 2005...........................................................   F-28

      Statements of Cash Flows for the three months ended March 31, 2006
      and 2005...........................................................   F-29

      Notes to Financial Statements......................................   F-30


                                      F-26
<PAGE>

                            FSP Eldridge Green Corp.
                                 Balance Sheets
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                                March 31,   December 31,
(in thousands, except shares and par value amounts)                               2006           2005
=========================================================================================================

<S>                                                                             <C>            <C>
Assets:

Real estate investments, at cost:
     Land                                                                       $  2,356       $  2,356
     Buildings and improvements                                                   33,054         33,054
- ---------------------------------------------------------------------------------------------------------
                                                                                  35,410         35,410

     Less accumulated depreciation                                                 1,836          1,625
- ---------------------------------------------------------------------------------------------------------

Real estate investments, net                                                      33,574         33,785

Acquired real estate leases, net of accumulated amortization
      of $404 and $357                                                             1,118          1,165
Cash and cash equivalents                                                            945          2,391
Cash-funded reserves                                                               1,458          1,458
Tenant rent receivable                                                                17             19
Step rent receivable                                                                 444            421
Deferred leasing costs, net of accumulated amortization
      of $110 and $93                                                                390            407
Prepaid expenses and other assets                                                     20             23
- ---------------------------------------------------------------------------------------------------------

      Total assets                                                              $ 37,966       $ 39,669
=========================================================================================================

Liabilities and Stockholders' Equity:

Liabilities:
Accounts payable and accrued expenses                                           $    959       $  1,016
- ---------------------------------------------------------------------------------------------------------

     Total liabilities                                                               959          1,016
- ---------------------------------------------------------------------------------------------------------

Commitments and Contingencies:                                                        --             --

Stockholders' Equity:
     Preferred Stock, $.01 par value, 442.5 and 452.5 shares, respectively
        authorized, issued and outstanding                                            --             --

     Common Stock, $.01 par value, 1 share
        authorized, issued and outstanding                                            --             --
     Additional paid-in capital                                                   40,609         41,527
     Retained deficit and distributions in excess of earnings                     (3,602)        (2,874)
- ---------------------------------------------------------------------------------------------------------

     Total Stockholders' Equity                                                   37,007         38,653
- ---------------------------------------------------------------------------------------------------------

     Total Liabilities and Stockholders' Equity                                 $ 37,966       $ 39,669
=========================================================================================================
</TABLE>


                 See accompanying notes to financial statements.


                                      F-27
<PAGE>

                            FSP Eldridge Green Corp.
                            Statements of Operations
                                   (unaudited)

                                                            For the Three Months
                                                              Ended March 31,
                                                            --------------------
(in thousands, except shares and per share amounts)            2006        2005
================================================================================

Revenues:
     Rental                                                  $1,600      $1,623
- --------------------------------------------------------------------------------

       Total revenue                                          1,600       1,623
- --------------------------------------------------------------------------------

Expenses:

     Rental operating expenses                                  255         169
     Real estate taxes and insurance                            243         249
     Depreciation and amortization                              275         275
     General and administrative                                 130          --
- --------------------------------------------------------------------------------

       Total expenses                                           903         693
- --------------------------------------------------------------------------------

Income before interest income                                   697         930

Interest income                                                  31           9
- --------------------------------------------------------------------------------

Net income attributable to preferred stockholders            $  728      $  939
================================================================================

Weighted average number of preferred shares outstanding,
     basic and diluted                                        450.1       452.5
================================================================================

Net income per preferred share, basic and diluted            $1,618      $2,075
================================================================================


                 See accompanying notes to financial statements.


                                      F-28
<PAGE>

                            FSP Eldridge Green Corp.
                            Statements of Cash Flows
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                             For the Three Months
                                                                              Ended December 31,
                                                                            ------------------------
(in thousands)                                                                2006          2005
====================================================================================================

<S>                                                                         <C>           <C>
Cash flows from operating activities:
     Net income                                                             $    728      $    939
     Adjustments to reconcile net income to net cash provided by
         (used for) operating activities:
              Depreciation and amortization                                      275           275
          Changes in operating assets and liabilities:
              Tenant rent receivable                                               2             8
              Step rent receivable                                               (23)         (106)
              Prepaid expenses and other assets                                    3             6
              Accounts payable and accrued expenses                              (57)       (1,165)
- ----------------------------------------------------------------------------------------------------

                  Net cash provided by (used for) operating activities           928           (43)
- ----------------------------------------------------------------------------------------------------

Cash flows from investing activities (none):
- ----------------------------------------------------------------------------------------------------

Cash flows from financing activities:
     Distributions to stockholders                                            (1,133)         (943)
     Perferred shares redeemed                                                (1,241)           --
- ----------------------------------------------------------------------------------------------------

                  Net cash used for financing activities                      (2,374)         (943)
- ----------------------------------------------------------------------------------------------------

Net decrease in cash and cash equivalents                                     (1,446)         (986)

Cash and cash equivalents, beginning of year                                   2,391         2,569
- ----------------------------------------------------------------------------------------------------

Cash and cash equivalents, end of year                                      $    945      $  1,583
====================================================================================================
</TABLE>


                 See accompanying notes to financial statements.


                                      F-29
<PAGE>

                            FSP Eldridge Green Corp.
                          Notes to Financial Statements
                                   (unaudited)

Organization, Properties, Basis of Presentation and Recent Accounting
Pronouncements

Organization

FSP Eldridge Green Corp. (the "Company") was organized on December 4, 2003 as a
corporation under the laws of the State of Delaware to purchase, own and operate
a five-story Class "A" suburban office building containing approximately 248,399
rental square feet of space located on approximately 8 acres of land in Houston,
TX (the "Property"). The Company acquired the Property on January 16, 2004 and
will operate in a manner intended to qualify as a real estate investment trust
("REIT") for federal income tax purposes.

On March 15, 2006, the Company entered into a merger agreement with its common
shareholder, Franklin Street Properties Corp ("FSP"). On March 31, 2006, FSP
sent the Company's shareholders a Consent Solicitation/Offering Memorandum
indicating its intent to merge the Company and four additional REITs with and
into five of FSP's wholly-owned subsidiaries. The merger required the approval
of a majority of the shareholders of the Company as well as a majority of the
shareholders of the four additional REITs. The Company completed the merger on
April 30, 2006 and FSP issued approximately 2,568,506 shares of its common stock
in exchange for a 100% ownership interest in the Company. The Company has
incurred approximately $130,000 of costs through March 31, 2006, related to the
merger and these costs have been included as an expense in the Statements of
Operations.

Basis of Presentation

The accompanying interim financial statements are unaudited; however, the
financial statements have been prepared in accordance with accounting principles
generally accepted in the United States of America ("GAAP") for interim
financial information and in conjunction with the rules and regulations of the
Securities and Exchange Commission. Accordingly, they do not include all of the
disclosures required by accounting principles generally accepted in the United
States of America for complete financial statements. In the opinion of
management, all adjustments (consisting solely of normal recurring matters)
necessary for a fair presentation of the financial statements for these interim
periods have been included.

These financial statements should be read in conjunction with the Company's
financial statements and notes thereto for its fiscal year ended December 31,
2005.

Estimates and Assumptions

The Company prepares its financial statements and related notes in conformity
with GAAP. These principles require management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenue and expenses during the reporting period. Actual
results could differ from those estimates.

2. Net Income Per Share

Basic net income per share is computed by dividing net income by the weighted
average number of Company shares outstanding during the period. Diluted net
income per share reflects the potential dilution that could occur if securities
or other contracts to issue shares were exercised or converted into shares.
There were no potential dilutive shares outstanding at March 31, 2006 and 2005.

3. Income Taxes

The Company has elected to be taxed as a REIT under the Internal Revenue Code of
1986, as amended (the "Code"). As a REIT, the Company generally is entitled to a
tax deduction for dividends paid to its shareholders, thereby effectively
subjecting the distributed net income of the Company to taxation at the
shareholder level only. The Company must comply with a variety of restrictions
to maintain its status as a REIT. These restrictions include the type of income
it can earn, the type of assets it can hold, the number of shareholders it can
have and the concentration of their ownership, and the amount of the Company's
income that must be distributed annually.


                                      F-30
<PAGE>

                            FSP Eldridge Green Corp.
                          Notes to Financial Statements
                                   (unaudited)

4. Related Party Transactions

The Company executed a management agreement with FSP Property Management LLC, an
affiliate of FSP, that provides for a management fee equal to 1% of collected
revenues and is cancelable with 30 days notice by either party. Fees incurred
under the agreement were $16,000 and $15,000 for the three months ended March
31, 2006 and 2005, respectively.

5. Cash Distributions

The Company's cash distributions for the three months ended March 31, 2006 and
2005 are as follows:

Quarter Paid                                           2006                2005
- ---------------------------------------               ------               -----
(in thousands)
First Quarter                                         $1,133               $ 943

6. Subsequent Events

The Company declared a cash distribution of $1,121,038 on April 17, 2006 to
stockholders of record on April 28, 2006 payable on May 19, 2006.

On April 30, 2006, the Company completed the merger with FSP along with the
additional four REITs pursuant to the Agreement and Plan of Merger, dated March
15, 2006.


                                      F-31

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.2
<SEQUENCE>3
<FILENAME>ex99-2.txt
<TEXT>

                                                                    Exhibit 99.2


       SELECTED COMBINING CONDENSED CONSOLIDATED PRO FORMA FINANCIAL DATA

      The following unaudited pro forma financial information gives effect to
the acquisition of FSP Willow Bend Office Center Corp., FSP Innsbrook Corp., FSP
380 Interlocken Corp., FSP Blue Lagoon Drive Corp., and FSP Eldridge Green Corp.
(collectively, the "Target REITs") by five wholly-owned acquisition subsidiaries
of FSP Corp., which was consummated on April 30, 2006.

      The unaudited pro forma financial information has been prepared based upon
certain pro forma adjustments to the historical consolidated financial
statements of FSP Corp. and the Target REITs. The pro forma consolidated balance
sheets have been presented as if the mergers occurred as of March 31, 2006. The
pro forma consolidated statements of income for the three months ended March 31,
2006 and the consolidated pro forma statements of cash flow for the three months
ended March 31, 2006 are presented as if the mergers occurred at the beginning
of the period presented.

      Certain balances in the Target REIT financial statements have been
reclassified to conform to FSP Corp.'s presentation.

      The unaudited pro forma financial information has been derived from the
consolidated financial statements of FSP Corp. and the Target REITs and should
be read in conjunction with those financial statements and the accompanying
notes. For FSP Corp., please refer to its quarterly report on Form 10-Q for the
quarter ended March 31, 2006.

      The unaudited pro forma consolidated financial statement data are not
necessarily indicative of what the combined company's actual financial position
or results of operations of the combined companies would have been as of the
date or for the period indicated, nor do they purport to represent the combined
company's financial position or results of operations of the combined companies
as of or for any future period.


                                      P-1
<PAGE>

                        Franklin Street Properties Corp.
            Combining Condensed Consolidated Pro Forma Balance Sheets
                                 March 31, 2006
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                Historical
                                                 Historical       Target       Pro Forma
(in thousands)                                   FSP Corp.       REITs(i)     Adjustments        Pro Forma
- ------------------------------------------------------------------------------------------------------------

<S>                                               <C>            <C>           <C>               <C>
Assets:
Real estate assets, net                           $ 538,915      $ 159,835     $ 48,223(c)(d1)   $ 746,973
Acquired real estate leases, net                     28,108          4,183       14,348(d2)         46,639
Investment in non-consolidated REITs                  4,966             --       (4,090)(d3)           876
Assets held for syndication                          51,416             --           --             51,416
Assets held for sale                                 43,822             --           --             43,822
Cash and cash equivalents                            33,312         16,149         (177)(c)         49,284
Restricted cash                                         465            178           --                643
Tenant rents receivable, net                          1,240            295           --              1,535
Straight line rents receivable, net                   4,972          1,800       (1,800)(l)          4,972
Prepaid expenses                                        830            136           --                966
Other assets                                          1,731            102         (783)(c)          1,050
Office computers & furniture, net                       313             --           --                313
Deferred leasing commissions, net                     2,298          1,171       (1,171)(m)          2,298
- ------------------------------------------------------------------------------------------------------------

Total assets                                      $ 712,388      $ 183,849     $ 54,550          $ 950,787
============================================================================================================

Liabilities and stockholders' equity:
Liabilities:
Bank note payable                                 $  41,500      $      --     $     --          $  41,500
Accounts payable and accrued expenses                11,108          3,422           --             14,530
Accrued compensation                                  1,336             --           --              1,336
Distribution payable                                     --             --        4,052(k)           4,052
Tenant security deposits                              1,369            178           --              1,547
Acquired unfavorable real estate leases, net            889             --          220(d4)          1,109
- ------------------------------------------------------------------------------------------------------------
Total liabilities                                    56,202          3,600        4,272             64,074
- ------------------------------------------------------------------------------------------------------------

Stockholders' Equity:
Preferred stock                                          --             --           --                 --
Common stock                                              6             --            1(f)               7
Additional paid in capital                          677,397        202,243       28,283(f)         907,923
Treasury stock                                      (14,008)            --           --            (14,008)
Earnings (distributions) in excess of
   accumulated earnings/distributions                (7,209)       (21,994)      21,994(n)          (7,209)
- ------------------------------------------------------------------------------------------------------------
Total stockholders' equity                          656,186        180,249       50,278            886,713
- ------------------------------------------------------------------------------------------------------------

Total liabilities and stockholders' equity        $ 712,388      $ 183,849     $ 54,550          $ 950,787
============================================================================================================
</TABLE>


                                      P-2
<PAGE>

                        Franklin Street Properties Corp.
         Combining Condensed Consolidated Pro Forma Statements of Income
                           For the Three Months Ended
                                 March 31, 2006
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                Historical
                                                  Historical      Target       Pro Forma
(in thousands, except per share amounts)          FSP Corp.      REITs(j)     Adjustments      Pro Forma
- ---------------------------------------------------------------------------------------------------------
<S>                                                <C>            <C>         <C>              <C>
Revenue:
     Rental income                                 $ 24,281       $6,333      $   (450)(d5)    $ 30,164
Related party revenue:
     Syndication fees                                 1,921           --            --            1,921
     Transaction fees                                 1,939           --            --            1,939
     Management fees and interest on loans              171           --           (68)(e)          103
     Other                                               22           --            --               22
- ---------------------------------------------------------------------------------------------------------
Total revenue                                        28,334        6,333          (518)          34,149
- ---------------------------------------------------------------------------------------------------------
Expenses:
     Rental operating expenses                        4,992        1,283           (68)(e)        6,207
     Real estate taxes and insurance                  2,733          894            --            3,627
     Depreciation and amortization                    5,377        1,308           259(d6)        7,393
                                                                                   449(d7)
     Selling, general and administrative              1,805          633(b)         --            2,438
     Commissions                                      1,022           --            --            1,022
     Interest                                           594           --            --              594
- ---------------------------------------------------------------------------------------------------------
Total expenses                                       16,523        4,118           640           21,281
- ---------------------------------------------------------------------------------------------------------

Income (loss) before interest income,
     equity in earnings in non-consolidated
     REITs, taxes, discontinued operations
     and gain on sales of properties                 11,811        2,215        (1,158)          12,868
   Interest Income                                      588          184            --              772
   Equity in income of non-consolidated REITs            80           --           (52)(g)           28
   Taxes on income (a)                                  (57)          --            --              (57)
Income from discontinued operations                     717           --            --              717
- ---------------------------------------------------------------------------------------------------------
Net income                                         $ 13,139       $2,399      $ (1,210)        $ 14,328
=========================================================================================================

Weighted average shares outstanding,
     basic and diluted                               59,795           --        10,972(f)        70,766
- ---------------------------------------------------------------------------------------------------------

Income per share attributable to:
   Continuing operations                           $   0.21       $   --      $     --         $   0.19
   Discontinued operations                         $   0.01           --            --         $   0.01
- ---------------------------------------------------------------------------------------------------------
Basic and diluted net income per share             $   0.22       $   --      $     --         $   0.20
=========================================================================================================
</TABLE>


                                      P-3
<PAGE>

                        Franklin Street Properties Corp.
       Combining Condensed Consolidated Pro Forma Statements of Cash Flow
                           For the Three Months Ended
                                 March 31, 2006
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                          Historical
                                                           Historical       Target         Pro Forma
(in thousands)                                             FSP Corp.       REITs(o)       Adjustments            Pro Forma
- -----------------------------------------------------------------------------------------------------------------------------

<S>                                                         <C>            <C>            <C>                    <C>
Cash flows from operating activities:
Net income                                                  $ 13,139       $  2,399       $  (1,210)             $  14,328
Adjustments to reconcile net income to net
     cash provided by operating activities:
   Depreciation and amortization expense                       5,659          1,308             708(d6,d7)           7,675
   Amortization of above market lease                          1,474            326             450(d5)              2,250
   Equity in earnings of non-consolidated REITs                 (275)            --              52(g)                (223)
   Distributions from non-consolidated REITs                     118             --             (93)(h)                 25
Changes in operating assets and liabilities:
   Restricted cash                                                (4)           (10)             --                    (14)
   Tenant rent receivables, net                                  207             13              --                    220
   Straight-line rents, net                                      200             (9)             --                    191
   Prepaid expenses and other assets, net                        210             62              --                    272
   Accounts payable, accrued expenses & other items           (1,254)          (484)             --                 (1,738)
   Accrued compensation                                         (555)            --              --                   (555)
   Tenant security deposits                                       76             10              --                     86
Payment of deferred leasing commissions                         (156)          (449)             --                   (605)
- -----------------------------------------------------------------------------------------------------------------------------
Net cash provided by (used for) operating activities          18,839          3,166             (93)                21,912
- -----------------------------------------------------------------------------------------------------------------------------

Cash flows from investing activities:
   Purchase of real estate assets and office computers
     and furniture, capitalized merger costs                 (25,744)            (8)           (177)(c)            (25,929)
   Acquired real estate leases                                  (951)            --              --                   (951)
   Investment in non-consolidated REITs                          (11)            --              --                    (11)
   Investment in assets held for syndication                 (51,500)            --              --                (51,500)
- -----------------------------------------------------------------------------------------------------------------------------
Net cash provided by (used for) investing activities         (78,206)            (8)           (177)               (78,391)
- -----------------------------------------------------------------------------------------------------------------------------

Cash flows from financing activities:
   Distributions to stockholders                             (18,536)        (4,670)             93(h)             (23,113)
   Redemption of preferred shares                                 --         (1,241)             --                 (1,241)
   Proceeds from (payments to) bank note payable, net         41,500             --              --                 41,500
- -----------------------------------------------------------------------------------------------------------------------------
      Net cash  provided by (used for) financing
         activities                                           22,964         (5,911)             93                 17,146
- -----------------------------------------------------------------------------------------------------------------------------

Net increase (decrease) in cash and cash equivalents         (36,403)        (2,753)           (177)               (39,333)
Cash and cash equivalents, beginning of year                  69,715         18,902              --                 88,617
- -----------------------------------------------------------------------------------------------------------------------------
Cash and cash equivalents, end of year                      $ 33,312       $ 16,149       $    (177)             $  49,284
=============================================================================================================================

Supplemental disclosure of cash flow information:
   Cash paid for:
     Interest                                               $    513       $     --       $      --              $     513
     Taxes on income                                        $     50       $     --       $      --              $      50
   Non-cash investing and financing activities:
     Assets acquired through issuance of common
       stock in the merger transaction, net                 $     --       $     --       $ 221,319              $ 221,319
     Accrued merger costs at period end                     $    779       $     --       $      --              $     779
</TABLE>


                                      P-4
<PAGE>

                        FRANKLIN STREET PROPERTIES CORP.
    NOTES TO COMBINING CONDENSED CONSOLIDATED PRO FORMA FINANCIAL STATEMENTS
                                   (Unaudited)

BASIS OF PRESENTATION

      The following unaudited combining condensed consolidated pro forma
financial statement presentation has been prepared based upon certain pro forma
adjustments to the historical consolidated financial statements of FSP Corp. The
pro forma balance sheets are presented as if the mergers occurred as of March
31, 2006. The pro forma statements of income and the pro forma statements of
cash flow are presented as if the mergers occurred as of the beginning of the
periods presented.

      The mergers will be treated as a purchase of assets and each target REIT's
assets and liabilities will be recorded on FSP Corp.'s books at their fair value
as of the effective date of the mergers as determined in accordance with
generally accepted accounting principles in the United States (or "GAAP").
Pursuant to the Agreement and Plan of Merger dated March 15, 2006 ("Plan of
Merger"), the Company issued 10,971,697 shares of common stock of FSP Corp (or
the "FSP Shares") and paid cash in lieu of issuing 582 FSP Shares, based on a
share price of $20.94, as calculated on April 26, 2006 ("the Measurement Date").
For pro forma presentation, the fair value was calculated in accordance with
GAAP and was measured by the issuance of approximately 10,972,000 shares at a
market price of $21.01 (the "Market Price"), which resulted in total stock
consideration of $230,527,000; plus FSP's Corp's basis in its investment in Blue
Lagoon, which was $4,090,000 as of March 31, 2006; plus $960,000 of capitalized
acquistion costs paid by FSP Corp in connection with the mergers.

      The Market Value of FSP Corp.'s common stock of $21.01 is based on a
volume weighted average price (or "VWAP") as reported by Bloomberg Financial
Markets, which is the average price at which the FSP Shares traded in all
reported public markets, adjusted for the size of each trade. It is calculated
by multiplying the size of every trade by the price, taking the sum of these
values, and then dividing by the total trade volume in all reported public
markets between April 24, 2006 and April 28, 2006. The trades between and
including these dates represent market prices for two days before, the day of,
and two days following the Measurement Date, which occurred prior to the
consummation of the mergers on April 30, 2006.

      The value ascribed to the net assets of the target REITs is estimated to
be $235,577,000, which includes real estate assets of $226,369,000, and net
current assets of $9,208,000 including cash. Other assets, net of liabilities,
are expected to be immaterial. The value allocated to the assets acquired in the
mergers is preliminary and subject to the receipt of additional information,
and is expected to be finalized in the second or third quarter of 2006.

PRO FORMA ADJUSTMENTS

      Certain assumptions regarding the operations of FSP Corp. have been made
in connection with the preparation of the combining condensed consolidated
financial pro forma information. These assumptions are as follows:

      (a)   FSP Corp. and each of the target REITs have elected to be, and are
            qualified as, a real estate investment trust for federal income tax
            purposes. Each entity has met the various required tests; therefore,
            no provision for federal or state income taxes has been reflected on
            real estate operations.

            FSP Corp. has subsidiaries which are not in the business of real
            estate operations. Those subsidiaries are taxable as real estate
            investment trust subsidiaries, or TRS, and are subject to income
            taxes at statutory tax rates. The taxes on income shown in the pro


                                      P-5
<PAGE>

                        FRANKLIN STREET PROPERTIES CORP.
    NOTES TO COMBINING CONDENSED CONSOLIDATED PRO FORMA FINANCIAL STATEMENTS
                                   (Unaudited)

            forma statements of income are the taxes on income of the TRS. There
            are no material items that would cause a deferred tax asset or a
            deferred tax liability.

      (b)   Costs of the mergers to the target REITs are estimated at $633,000
            and were incurred as of March 31, 2006, and were recorded as an
            administrative expense.

      (c)   The costs of the mergers to FSP Corp. are estimated at $960,000 and
            are capitalized to the assets acquired with $783,000 of the costs
            incurred as of March 31, 2006 and the $177,000 reflected as paid as
            of March 31, 2006.

      (d)   The following schedule shows the merger consideration for the
            acquired properties and is reconciled to the purchase price of such
            properties.

<TABLE>
<CAPTION>
(in thousands)                        Willow Bend     Innsbrook     380 Interlocken    Blue Lagoon     Eldridge         Total
                                      -----------     ---------     ---------------    -----------     --------         -----
<S>                                     <C>            <C>             <C>               <C>           <C>            <C>
Merger consideration                    $ 20,669       $ 50,167        $ 50,568          $ 55,159      $ 53,964       $ 230,527
FSP's Corp.'s Basis in Blue Lagoon                                                          4,090                         4,090(d3)
Capitalized merger costs                      84            203             205               244           224             960
Adjusted Cash Reserves                      (974)        (2,147)         (2,828)           (2,899)         (360)         (9,208)
                                      ------------------------------------------------------------------------------------------
Purchase price of properties            $ 19,779       $ 48,223        $ 47,945          $ 56,594      $ 53,828       $ 226,369
                                      ==========================================================================================
</TABLE>

            The cost of the property held by each target REIT (including
            capitalized merger costs of $960,000) has been allocated to real
            estate assets, acquired lease origination costs and acquired
            favorable leases. Acquired lease origination costs represent the
            value associated with acquiring an in-place lease (i.e., the market
            cost to execute a similar lease, including leasing commission,
            legal, vacancy and other related costs). Acquired favorable leases
            represents the value associated with a lease which has a rental
            stream with above market rates. The value assigned to buildings,
            land and leases approximates their fair value.

The following schedule shows the difference between historical costs (net of
accumulated depreciation and amortization) of the properties and their allocated
purchase price. The purchase price of the properties is determined based upon
the fair value of the assets acquired. Depreciation and amortization for the
target REITs is based on a preliminary allocation of the purchase price to real
estate investments and to the leases acquired. The allocation is subject to
change as additional information is obtained. An increase in the allocation to
acquired lease origination costs will result in an increase in amortization
expense. For each $1,000,000 increase in acquired real estate leases, the
related pro forma amortization expense will increase by approximately $255,000
per year.


                                      P-6
<PAGE>

                        FRANKLIN STREET PROPERTIES CORP.
    NOTES TO COMBINING CONDENSED CONSOLIDATED PRO FORMA FINANCIAL STATEMENTS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                                                     Depreciation
                                                                   Allocated                         Life or       and Amortization
                                                  Historical        Purchase                       Average Life   Three Months ended
(in thousands, except years)                       Cost, net         Price         Difference        (years)        March 31, 2006
- ------------------------------------------------------------------------------------------------------------------------------------

Willow Bend
- ------------------------------------------------
<S>                                                <C>             <C>                <C>            <C>               <C>
Land                                               $  2,737        $  3,800           $ 1,063             N/A          $   --
Building                                             13,265          14,907             1,642            39.0              11
Acquired real estate leases, favorable                   --              79                79             2.6               8
Acquired unfavorable real estate leases                  --            (220)             (220)            3.0             (18)
Acquired real estate leases, origination costs           --           1,213             1,213             2.3             132
                                                   --------        --------           -------                          ------
Total                                              $ 16,002        $ 19,779           $ 3,777                          $  133
                                                   ========        ========           =======                          ======

Innsbrook
- ------------------------------------------------
Land                                               $  3,643        $  5,000           $ 1,357             N/A          $   --
Building                                             31,394          40,199             8,805            39.0              56
Acquired real estate leases, favorable                   --             342               342            10.5               8
Acquired real estate leases, origination costs          730           2,682             1,952            10.5              46
                                                   --------        --------           -------                          ------
Total                                              $ 35,767        $ 48,223           $12,456                          $  110
                                                   ========        ========           =======                          ======

380 Interlocken
- ------------------------------------------------
Land                                               $  5,287        $  8,275           $ 2,988             N/A          $   --
Building                                             25,371          34,820             9,449            39.0              61
Acquired real estate leases, favorable                1,522           3,328             1,806             4.0             113
Acquired real estate leases, origination costs          290           1,522             1,232             3.5              88
                                                   --------        --------           -------                          ------
Total                                              $ 32,470        $ 47,945           $15,475                          $  262
                                                   ========        ========           =======                          ======

Blue Lagoon
- ------------------------------------------------
Land                                               $  5,463        $  6,350           $   887             N/A          $   --
Building                                             39,101          46,625             7,524            39.0              48
Acquired real estate leases, favorable                   --           2,394             2,394             2.4             249
Acquired real estate leases, origination costs          523           1,225               702             2.4              73
                                                   --------        --------           -------                          ------
Total                                              $ 45,087        $ 56,594           $11,507                          $  370
                                                   ========        ========           =======                          ======

Eldridge
- ------------------------------------------------
Land                                               $  2,356        $  3,900           $ 1,544             N/A          $   --
Building                                             31,218          44,182            12,964            39.0              83
Acquired real estate leases, favorable                   --           2,087             2,087             5.8              90
Acquired real estate leases, origination costs        1,118           3,659             2,541             5.8             110
                                                   --------        --------           -------                          ------
Total                                              $ 34,692        $ 53,828           $19,136                          $  283
                                                   ========        ========           =======                          ======

Total
- ------------------------------------------------
Land                                               $ 19,486        $ 27,325           $ 7,839             N/A          $   --
Building                                            140,349         180,733            40,384            39.0             259(d6)
                                                   --------        --------           -------                          ------
   Real estate assets, net                          159,835         208,058            48,223(d1)                         259

Acquired real estate leases, favorable                1,522           8,230             6,708(d2)    2.4-10.5             468(d5)
Acquired unfavorable real estate leases                  --            (220)             (220)(d4)        3.0             (18)(d5)
Acquired real estate leases, origination costs        2,661          10,301             7,640(d2)    2.4-10.5             449(d7)
                                                   --------        --------           -------                          ------
Total                                              $164,018        $226,369           $62,351                          $1,158
                                                   ========        ========           =======                          ======
</TABLE>


                                      P-7
<PAGE>

                        FRANKLIN STREET PROPERTIES CORP.
    NOTES TO COMBINING CONDENSED CONSOLIDATED PRO FORMA FINANCIAL STATEMENTS
                                   (Unaudited)

      (e)   Management fees of $68,000 charged by FSP Corp. to the target REITs
            for the three months ended March 31, 2006 have been eliminated from
            revenue and expenses.

      (f)   Based on the assumption that the market value of the FSP common
            stock is $21.01, the weighted average stock price of the FSP common
            stock based on the stocks trading activity from April 24, 2006 to
            April 28, 2006 and approximately 10,972,000 shares of FSP common
            stock will be issued in exchange for the 2,153.25 outstanding shares
            of target REIT preferred stock in connection with the mergers.
            Stockholders' equity will be adjusted by the net difference between
            the assets and liabilities acquired in the merger. The following
            schedule shows a reconciliation detailing the adjustments to
            additional paid-in-capital.

<TABLE>
<CAPTION>
                                                        FSP       Target
                                                       Corp        REIT        Total
                                                    ----------   --------    --------

<S>                                                   <C>        <C>           <C>
       Additional paid-in-capital:
       FSP Corp:
       Total excess of Allocated Purchase
          Price over Historical Cost                  $62,351
       Less Investment in non-consolidated REIT        (4,090)
       Less Estimated Merger Costs                       (960)
                                                    ----------
                                                       57,301                  $57,301
       Adjustment to record Par Value                      (1)                      (1)

       Target REITS:
       Adjustments for:
       Straight-line rent receivables                             $(1,800)      (1,800)
       Deferred leasing commissions, net                           (1,171)      (1,171)
       Distribution payable                                        (4,052)      (4,052)
       Distributions in excess of earnings                        (21,994)     (21,994)
                                                    ----------------------------------
                                                      $57,300    $(29,017)     $28,283
                                                    ==================================
</TABLE>

      (g)   The $52,000 of equity in earnings of non-consolidated REITs for the
            three months ended March 31, 2006 related to FSP Corp.'s investment
            in Blue Lagoon has been eliminated from revenue.

      (h)   The $93,000 of distributions from non-consolidated REITs for the
            three months ended March 31, 2006 related to FSP Corp.'s investment
            in Blue Lagoon has been eliminated.


                                      P-8
<PAGE>

                        FRANKLIN STREET PROPERTIES CORP.
    NOTES TO COMBINING CONDENSED CONSOLIDATED PRO FORMA FINANCIAL STATEMENTS
                                   (Unaudited)

      (i)   The following table combines the historical balance sheets of the
            target REITs as of March 31, 2006. Certain amounts from the Target
            REITs have been reclassified to conform with FSP Corp.'s
            presentation.

<TABLE>
<CAPTION>
(in thousands)
                                               Willow Bend    Innsbrook  380 Interlocken   Blue Lagoon    Eldridge       Total
                                               -----------    ---------  ---------------   -----------    --------       -----
<S>                                              <C>           <C>           <C>            <C>           <C>           <C>
Assets:
Land                                             $  2,737      $  3,643      $  5,287       $  5,463      $  2,356      $  19,486
Building                                           15,497        33,737        27,231         41,684        33,054        151,203
                                                 --------      --------      --------       --------      --------      ---------
Real estate investments, cost                      18,234        37,380        32,518         47,147        35,410        170,689
    Less accumulated depreciation                   2,232         2,343         1,860          2,583         1,836         10,854
                                                 --------      --------      --------       --------      --------      ---------
Real estate investments, net                       16,002        35,037        30,658         44,564        33,574        159,835

Acquired lease origination costs, net                  --           730         1,812            523         1,118          4,183
Cash and equivalents                                1,501         2,845         4,620          4,780         2,403         16,149
Restricted cash                                       129            --            49             --            --            178
Tenant rent receivable, net                            38            --           240             --            17            295
Step rent receivable, net                             486           327           242            301           444          1,800
Prepaid expenses                                       15            87            83             33            20            238
Deferred leasing commissions, net                     325           447             9             --           390          1,171
                                                 --------      --------      --------       --------      --------      ---------
         Total assets                            $ 18,496      $ 39,473      $ 37,713       $ 50,201      $ 37,966      $ 183,849
                                                 ========      ========      ========       ========      ========      =========

Liabilities and stockholders' equity:
Accounts payable and accrued expenses            $    275      $    302      $  1,121       $    765      $    959      $   3,422
Tenant security deposits                              129            --            49             --            --            178
                                                 --------      --------      --------       --------      --------      ---------
         Total liabilities                            404           302         1,170            765           959          3,600
                                                 --------      --------      --------       --------      --------      ---------

Stockholders' equity
Preferred stock                                        --            --            --             --            --             --
Common stock                                           --            --            --             --            --             --
Additional paid in capital                         18,900        43,607        44,092         55,035        40,609        202,243
Retained deficit and distributions in excess
  of earnings                                        (808)       (4,436)       (7,549)        (5,599)       (3,602)       (21,994)
                                                 --------      --------      --------       --------      --------      ---------
         Total stockholders' equity                18,092        39,171        36,543         49,436        37,007        180,249
                                                 --------      --------      --------       --------      --------      ---------

Total liabilities & stockholders' equity         $ 18,496      $ 39,473      $ 37,713       $ 50,201      $ 37,966      $ 183,849
                                                 ========      ========      ========       ========      ========      =========
</TABLE>


                                      P-9
<PAGE>

                        FRANKLIN STREET PROPERTIES CORP.
    NOTES TO COMBINING CONDENSED CONSOLIDATED PRO FORMA FINANCIAL STATEMENTS
                                   (Unaudited)

      (j)   The following table combines the historical operations of the target
            REITs for the three months ended March 31, 2006.

<TABLE>
<CAPTION>
(in thousands)
                                      Willow Bend   Innsbrook  380 Interlocken   Blue Lagoon    Eldridge      Total
                                      -----------   ---------  ---------------   -----------    --------      -----
<S>                                     <C>          <C>          <C>             <C>           <C>          <C>

Revenue:
Rental                                  $    569     $  1,396     $  1,417        $  1,351      $  1,600     $  6,333
                                        --------     --------     --------        --------      --------     --------
Total revenue                                569        1,396        1,417           1,351         1,600        6,333
                                        --------     --------     --------        --------      --------     --------

Expenses:
Rental operating expenses                    206          296          438              88           255        1,283
Real estate taxes and insurance               97           90          300             164           243          894
Depreciation and amortization                168          268          237             360           275        1,308
Selling, general and administrative           74          132          134             163           130          633
                                        --------     --------     --------        --------      --------     --------
Total expenses                               545          786        1,109             775           903        4,118
                                        --------     --------     --------        --------      --------     --------

Income before interest                        24          610          308             576           697        2,215
Interest income                               12           27           53              61            31          184
                                        --------     --------     --------        --------      --------     --------
Net income                              $     36     $    637     $    361        $    637      $    728     $  2,399
                                        ========     ========     ========        ========      ========     ========
</TABLE>


                                      P-10
<PAGE>

                        FRANKLIN STREET PROPERTIES CORP.
    NOTES TO COMBINING CONDENSED CONSOLIDATED PRO FORMA FINANCIAL STATEMENTS
                                   (Unaudited)

      (k)   Distribution payable - The value ascribed to the net assets of the
            Target REITs includes real estate assets and net current assets that
            include cash. A final dividend was estimated to be paid to the
            shareholders of the target REITs, prior to the merger as of the date
            of the pro forma balance sheet for the target REITs, and is shown in
            the following table. The actual final dividend will consider
            earnings through March 31, 2006, cash available for distribution and
            other factors and may differ.

              (in thousands)
              380 Interlocken                $  994
              Blue Lagoon                     1,149
              Eldridge                        1,121
              Innsbrook                         483
              Willow Bend                       305
                                            -------
                  Total                      $4,052
                                            =======

      (l)   The cumulative unbilled straight-line rents of the target REITs will
            be eliminated at acquisition.

      (m)   The cumulative net deferred leasing costs of the target REITs will
            be eliminated at acquisition.

      (n)   The cumulative deficit of the target REITs will be eliminated at
            acquisition.


                                      P-11
<PAGE>

                        FRANKLIN STREET PROPERTIES CORP.
    NOTES TO COMBINING CONDENSED CONSOLIDATED PRO FORMA FINANCIAL STATEMENTS
                                   (Unaudited)

      (o)   The following table combines the historical cash flows for the
            target REITs for the three months ended March 31, 2006. Certain
            amounts from the Target REITs have been reclassified to conform with
            FSP Corp.'s presentation.

<TABLE>
<CAPTION>
                                                      Willow                     380          Blue
(in thousands)                                         Bend      Innsbrook   Interlocken     Lagoon     Eldridge       Total
                                                       ----      ---------   -----------     ------     --------       -----

<S>                                                  <C>          <C>          <C>          <C>          <C>          <C>
Cash flows from operating activities:
    Net income                                       $    36      $   637      $   361      $   637      $   728      $ 2,399

   Adjustments to reconcile net income to
      net cash provided by operating activities:
       Depreciation and amortization expense             168          268          237          360          275        1,308
       Amortization of above market lease                 --           --          326           --           --          326
   Changes in operating assets and liabilities:
       Restricted cash                                    --           --          (10)          --           --          (10)
       Tenant rent receivables, net                        9           --            2           --            2           13
       Straight-line rents, net                           23          (17)           5            3          (23)          (9)
       Prepaid expenses and other assets, net              8           22           21            8            3           62
       Accounts payable and accrued expenses            (158)        (344)        (188)         263          (57)        (484)
       Tenant security deposits                           --           --           10           --           --           10
   Payment of deferred leasing commissions                --         (447)          (2)          --           --         (449)
                                                     -------      -------      -------      -------      -------      -------

      Net cash provided by operating activities           86          119          762        1,271          928        3,166
                                                     -------      -------      -------      -------      -------      -------

Cash flows from investing activities:
      Purchase of real estate assets and related
         leases, office computers and furniture,
         capitalized merger costs                         --           --           (8)          --           --           (8)
                                                     -------      -------      -------      -------      -------      -------

      Net cash used for investing activities              --           --           (8)          --           --           (8)
                                                     -------      -------      -------      -------      -------      -------

Cash flows from financing activities:
      Distributions to stockholders                     (303)        (934)      (1,168)      (1,132)      (1,133)      (4,670)
      Redemption of preferred shares                      --           --           --           --       (1,241)      (1,241)
                                                     -------      -------      -------      -------      -------      -------

      Net cash used for financing activities            (303)        (934)      (1,168)      (1,132)      (2,374)      (5,911)
                                                     -------      -------      -------      -------      -------      -------

Net (decrease) increase in cash and cash
   equivalents                                          (217)        (815)        (414)         139       (1,446)      (2,753)
Cash and cash equivalents, beginning of period         1,718        3,660        5,034        4,641        3,849       18,902
                                                     -------      -------      -------      -------      -------      -------

Cash and cash equivalents, end of period             $ 1,501      $ 2,845      $ 4,620      $ 4,780      $ 2,403      $16,149
                                                     =======      =======      =======      =======      =======      =======
</TABLE>


                                      P-12
<PAGE>

                           COMPARATIVE PER SHARE DATA

      The following tables present on a per share basis:

      (a) Basic and diluted net income per share, book value per share, and
dividends per share declared for FSP Corp. and each of the target REITs on a
historical basis.

      (b) Consolidated pro forma basic and diluted net income per share, book
value per share and dividends per share for FSP Corp. This table shows the
effect of the mergers from the perspective of an owner of one share of FSP
common stock.

      (c) Equivalent pro forma basic and diluted net income per share,
equivalent pro forma book value per share and equivalent pro forma dividends per
share for each of the target REITs. This table shows the effect of the mergers
from the perspective of an owner of one share of stock of a Target REIT. The
consolidated pro forma data are multiplied by the number of shares of FSP common
stock issuable in exchange for each share of target stock, also known as the
exchange ratio, as shown in the following table:

      Target REIT                            Exchange Ratio
      -----------                            --------------
      Willow Bend                               4,775.55
      Innsbrook                                 5,026.89
      380 Interlocken                           5,014.33
      Blue Lagoon                               4,775.55
      Eldridge                                  5,804.53

      The pro forma financial data and equivalent pro forma data are unaudited
and are not necessarily indicative of the operating results that would have been
achieved had the mergers occurred as of the beginning of the period and should
not be construed as representative of future operations.

      FSP Corp. calculates historical book value per share by dividing
stockholders' equity by the number of shares of common stock (or preferred
stock, in the case of the target REITs) outstanding at the end of each period.

      FSP Corp. calculates consolidated pro forma net income per share data for
FSP Corp. as if the mergers occurred on January 1, 2006 and resulted in weighted
average shares of 70,766,000 for the three months ended March 31, 2006, based on
the assumption that the market value of the FSP common stock is $21.01, the
weighted average stock price of the FSP common stock based on the stocks trading
activity from April 24, 2006 to April 28, 2006 and approximately 10,972,000
shares of FSP common stock are issued in exchange for the 2,153.25 outstanding
shares of target REIT preferred stock in connection with the mergers.

      FSP Corp. calculates consolidated pro forma book value per share data for
FSP Corp. as if the mergers occurred on March 31,2006 and resulted in an ending
number of shares of 70,766,000, based on the assumption that the market value of
the FSP common stock is $21.01, the weighted average stock price of the FSP
common stock based on the stocks trading activity from April 24, 2006 to April
28, 2006 and approximately 10,972,000 shares of FSP common stock are issued in
exchange for the 2,153.25 outstanding shares of target REIT preferred stock in
connection with the mergers.

      FSP Corp. calculates consolidated pro forma dividends per share by adding
the total dividends paid by FSP Corp. plus dividends paid by the target REITs
and dividing this sum by 70,766,000 shares, based on the assumption that FSP
issued approximately 10,972,000 of common stock in exchange for the 2,153.25
outstanding shares of target REIT preferred stock in connection with the mergers
as shown in the following table:


                                      P-13
<PAGE>

                      COMPARATIVE PER SHARE DATA, Continued

                                          For the three months ended
       (in thousands)                           March 31, 2006
       -------------------------------------------------------------

       FSP Corp.                                  $18,536
       Willow Bend                                    303
       Innsbrook                                      934
       380 Interlocken                              1,168
       Blue Lagoon                                  1,132
       Eldridge                                     1,133
                                                  -------

           Total                                  $23,206
                                                  =======


      FSP Corp. calculates equivalent pro forma net income per share for each
target REIT by multiplying the consolidated pro forma net income per share by
the exchange ratio.

      FSP Corp. calculates equivalent pro forma book value per share for each
target REIT by multiplying the consolidated pro forma book value per share by
the exchange ratio.

      FSP Corp. calculates equivalent pro forma dividends per share for each
target REIT by multiplying the consolidated pro forma dividends per share by the
exchange ratio.


                                      P-14
<PAGE>

      For the purposes of the consolidated pro forma net income per share and
book value per share data, FSP Corp.'s historical financial data have been
consolidated with the target REITs' financial data.

                        Franklin Street Properties Corp.
                           Comparative Per Share Data
                      As of and for the three months ended

                                 March 31, 2006
                                   (unaudited)

                                                       Pro forma      Pro forma
                                        Historical    Consolidated    Equivalent
                                        ----------------------------------------

Net income (loss) per share
  basic and diluted
     FSP Corp.                            $  0.22        $  0.20       $    --

     Willow Bend                              175             --           955
     Innsbroook                             1,341             --         1,005
     380 Interlocken                          752             --         1,003
     Blue Lagoon                            1,063             --           955
     Eldridge                               1,618             --         1,161

Book value per share
     FSP Corp.                            $ 10.97        $ 12.53       $    --

     Willow Bend                           87,825             --        59,838
     Innsbroook                            82,465             --        62,987
     380 Interlocken                       76,131             --        62,830
     Blue Lagoon                           82,531             --        59,838
     Eldridge                              83,632             --        72,731

Dividends declared per share
     FSP Corp.                            $  0.31        $  0.33       $    --

     Willow Bend                            1,471             --         1,576
     Innsbroook                             1,966             --         1,659
     380 Interlocken                        2,433             --         1,655
     Blue Lagoon                            1,890             --         1,576
     Eldridge                               2,504             --         1,915


                                      P-15
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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