In October 2003, Meritage Properties acquired 475 School Street, SW, a 57,800 square foot office building located in the heart of Washington, DC's Capitol Hill/Southwest submarket. 475 School Street was constructed in 1967 and significantly renovated in 1996. The building contains 45 below-grade and surface parking spaces and features terraces on the fifth floor.

In December 2004, ownership of 475 School Street was transferred to a tenancy in common among an affiliate of Meritage Properties and members of the Eckles Family. Meritage remains asset manager of the property and its affiliate serves as "coordinating tenant in common".

Amenities:

• 5 stories
• 57,800 square feet of office space
• 12,000 rsf per floor
• Electronic card access system
• Surveillance cameras
• Computerized energy management system
• Fitness center with locker rooms
• Located one half block from L'Enfant Plaza Metrorail Station

475 School Street is fully leased through June of 2010 to Northrop Grumman Mission Systems Group, serving as the home to a key FAA contract to "overhaul" the United States air traffic control system.

Having completed the objectives of our investment, Meritage sold 475 School Street in September of 2007, resulting in investor returns exceeding original projections.