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SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

FOR QUARTER ENDED March 31, 2005

COMMISSION FILE NO. 000-22741

CARRAMERICA REALTY, L.P.

(Exact name of registrant as specified in its charter)

1850 K Street, N.W., Washington, D.C. 20006

(Address or principal executive office) (Zip code)

Registrant’s telephone number, including area code (202) 729-1700

N/A

(Former name, former address and former fiscal year, if changed since last report)

Number of Partnership Units outstanding of each of the registrant’s

classes of Partnership Units as of April 25, 2005: 14,362,972

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve (12) months (or such shorter period that the Registrant was required to file such report) and (2) has been subject to such filing requirements for the past ninety (90) days.    YES  x    NO  ¨

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).    YES  ¨    NO  x

Table of Contents

Index

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Part I

Item 1. Financial Information

The information furnished in our accompanying consolidated balance sheets, consolidated statements of operations and consolidated statements of cash flows reflects all adjustments which are, in our opinion, necessary for a fair presentation of the aforementioned financial statements for the interim periods.

The financial statements should be read in conjunction with the notes to the financial statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations. The results of operations for the three months ended March 31, 2005 are not necessarily indicative of the operating results to be expected for the full year.

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CARRAMERICA REALTY, L.P. AND SUBSIDIARIES

Consolidated Balance Sheets

As of March 31, 2005 and December 31, 2004

See accompanying notes to consolidated financial statements.

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CARRAMERICA REALTY, L.P. AND SUBSIDIARIES

Consolidated Statement of Operations

For the Three Months Ended March 31, 2005 and 2004

See accompanying notes to consolidated financial statements.

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CARRAMERICA REALTY, L.P. AND SUBSIDIARIES

Consolidated Statement of Cash Flows

For the Three Months Ended March 31, 2005 and 2004

See accompanying notes to consolidated financial statements.

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CARRAMERICA REALTY, L.P. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

We are a Delaware limited partnership formed on March 6, 1996 for the purpose of owning, acquiring, developing and operating office buildings across the United States. As of March 31, 2005, we owned a controlling interest in a portfolio of 53 operating office buildings. As of March 31, 2005, we also owned a minority interest in 31 operating office buildings. The properties are located in Austin, Chicago, Dallas, Denver, Orange County/Los Angeles, Phoenix, San Francisco Bay Area, Salt Lake City, San Diego, Seattle and Washington, D.C.

We are managed indirectly by CarrAmerica Realty Corporation, a fully integrated, self-administered and self-managed publicly traded real estate investment trust (“REIT”). On June 30, 2004, CarrAmerica Realty Corporation contributed substantially all of it assets to CarrAmerica Realty Operating Partnership, L.P. (“the Operating Partnership”) in exchange for units of common and preferred partnership interest in the Operating Partnership. The Operating Partnership assumed substantially all of CarrAmerica Realty Corporation’s liabilities (CarrAmerica Realty Corporation and CarrAmerica Realty Operating Partnership, L.P. are collectively referred to hereafter as “CarrAmerica”). Our general partner is CarrAmerica Realty GP Holdings, LLC (the “General Partner”), a wholly owned subsidiary of CarrAmerica. Our General Partner owned a 1.0% interest in us at March 31, 2005. Our limited partners are CarrAmerica Realty LP Holdings, LLC, a wholly owned subsidiary of CarrAmerica, which owned an approximate 91.9% interest in us at March 31, 2005, and various other individuals and entities, which collectively owned an approximate 7.1% interest in us at March 31, 2005.

The financial statements have been prepared using the accounting policies described in our 2004 annual report on Form 10-K. Our accounts and those of our controlled subsidiaries and affiliates are consolidated in the financial statements. We consolidate all entities in which we own a direct or indirect majority voting interest and where the minority holders do not have rights to participate in significant decisions that are made in the ordinary course of business. If applicable, we would consolidate any variable interest entity of which we are the primary beneficiary. We use the equity method to account for our investments in and our share of the earnings or losses of unconsolidated entities. These entities are not controlled by us. If events or changes in circumstances indicate that the fair value of an investment accounted for using the equity method has declined below its carrying value and we consider the decline to be “other than temporary,” the investment is written down to fair value and an impairment loss is recognized.

Management has made a number of estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses in the financial statements, and the disclosure of contingent assets and liabilities. Estimates are required in order for us to prepare our financial statements in conformity with U.S. generally accepted accounting principles. Significant estimates are required in a number of areas, including evaluating the impairment of long-lived assets, allocating the purchase cost of acquired properties and evaluating the collectibility of accounts receivable. Actual results could differ from these estimates.

In accordance with its established practices, CarrAmerica allocates certain general and administrative expenses to its subsidiaries, including us.

The financial statements reflect all adjustments, which are, in our opinion, necessary to reflect a fair presentation of results for the interim periods, and all adjustments are of a normal, recurring nature.

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Notes to Consolidated Financial Statements

(Unaudited)

Our mortgages and notes payable are summarized as follows:

We have fixed rate debt either in the form of mortgages payable (collateralized by properties) or notes payable to affiliates. The weighted average interest rate of our fixed rate debt at March 31, 2005 was 7.77%. Our mortgages payable mature in 2009 and have a weighted average interest rate at March 31, 2005 of 6.91%.

We have three loans with CarrAmerica. The first loan (balance as of March 31, 2005 and December 31, 2004 of $25.5 million and $25.6 million, respectively) bears interest at 8.5%, requires monthly principal and interest payments of $242,000 and matures on May 31, 2011. The second loan is a $12.0 million loan that bears interest at 8.5%, requires monthly interest only payments of $85,000 and matures on March 27, 2007. The third loan requires interest only payments equal to 100 basis points over 30-day LIBOR (3.87% as of March 31, 2005). The outstanding loan balance as of March 31, 2005 and December 31, 2004 was $27.0 million.

Debt maturities at March 31, 2005 were as follows:

On June 30, 2004, CarrAmerica entered into a new $500.0 million, three-year unsecured revolving credit facility with JPMorgan Chase Bank as administrative agent for a syndicate of banks. We are an unconditional guarantor of borrowings under this facility. The facility replaced and was used to repay all amounts outstanding under CarrAmerica’s previous senior unsecured credit facility. CarrAmerica may increase the facility to $700.0 million by request at any time within 24 months of the closing, provided the funding commitments are increased accordingly. The facility can be extended one year at CarrAmerica’s option. The facility carries an interest rate of 65 basis points over 30-day LIBOR, or 3.52% as of March 31, 2005. As of March 31, 2005, $388.0 million was drawn on the credit facility, $35.9 million in letters of credit were outstanding, and CarrAmerica had $76.1 million available for borrowing. As of April 1, 2005, after the application of the cash proceeds from CarrAmerica’s partial sale of CarrAmerica Corporate Center to a new joint venture, $248.0 million was drawn on the credit facility and $216.1 million was available for borrowing.

CarrAmerica’s unsecured credit facility contains financial and other covenants with which it must comply. Some of these covenants include:

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CARRAMERICA REALTY, L.P. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

As of March 31, 2005, CarrAmerica was in compliance with all debt covenants. However, CarrAmerica’s and our ability to draw on the unsecured credit facility or to incur other unsecured debt in the future could be restricted by the covenants. During the first quarter of 2005, CarrAmerica amended its credit facility increasing the maximum ratio of total debt to tangible fair market value of CarrAmerica’s assets to 60%. In addition, the capitalization rate used to compute the fair market value of CarrAmerica’s assets for purposes of calculating this ratio was decreased from 9.0% to 8.5% for properties located in the Washington D. C. metropolitan area.

We have unconditionally guaranteed certain unsecured notes issued by CarrAmerica to institutional and other investors. The aggregate principal amount of these unsecured notes was $1.275 and $1.375 billion as of March 31, 2005 and December 31, 2004, respectively. These notes are in the following form:

$100.0 million of senior unsecured notes matured on March 1, 2005 and were repaid on that date using borrowings from CarrAmerica’s unsecured credit facility.

The table below summarizes our property sale for the three months ended March 31, 2004:

We dispose of assets from time to time that are inconsistent with our long-term strategic or return objectives. We did not dispose of any assets during the three months ended March 31, 2005. During the three months ended March 31, 2004, we disposed of our Tower of the Hills property, recognizing a gain of $0.1 million. We have no continuing involvement with the Tower of the Hills property after the sale and, accordingly, the gain on this sale and the operating results of this property are classified as discontinued operations. We had previously recognized an impairment loss of $3.0 million on this property in the fourth quarter of 2003.

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Notes to Consolidated Financial Statements

(Unaudited)

Operating results of the Tower of the Hills property are summarized as follows:

During the remainder of 2005, we are anticipating marketing 7 operating properties for sale. As a result, we have reduced the estimated holding periods for these properties. Of these operating properties, two, Quorum Place and 5000 Quorum in Dallas, Texas, have book values in excess of our current estimate of their current fair market values less costs to sell and net operating cash receipts during their shortened holding periods. As a result, we recognized impairment losses of $1.8 million and $2.2 million, respectively, on these two properties. All of the properties currently do not meet our criteria to be classified as held for sale or discontinued operations.

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Management’s Discussion and Analysis

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The discussion that follows is based primarily on our consolidated financial statements as of March 31, 2005 and December 31, 2004 and for the three months ended March 31, 2005 and 2004 and should be read along with the consolidated financial statements and related notes appearing elsewhere in this report. The ability to compare one period to another may be significantly affected by acquisitions completed, development properties placed in service and dispositions made during those periods.

After several years of adverse conditions in the real estate markets, vacancy rates peaked in the majority of our markets in 2003 and then began to improve. In 2004, we had positive net absorption in all of our markets, and vacancy rates declined in all or our markets except Chicago and Salt Lake City. As a result of improved job growth, leasing activity is up significantly, and we believe that market rental rates have stabilized in all of our markets and have improved in some of our markets, including Washington, D.C. and Southern California. Rental economics are expected to improve in most of our markets by the end of 2005.

Due to the improving market conditions described above and the elimination of most of our poor credit quality tenants through lease defaults and terminations in the last few years, we believe that our average occupancy in most markets stabilized in the second half of 2004. Occupancy in our portfolio of operating properties increased to 89.0% at March 31, 2005 compared to 87.8% at December 31, 2004 and 88.2% at March 31, 2004. If demand continues to improve in the balance of 2005, we expect that our overall portfolio average occupancy may improve further.

Critical Accounting Policies and Estimates

Critical accounting policies and estimates are those that are both important to the presentation of our financial condition and results of operations and require management’s most difficult, complex or subjective judgments. Our critical accounting policies and estimates relate to evaluating the impairment of long-lived assets, allocating the purchase cost of acquired properties, and evaluating the collectibility of accounts receivable.

Depreciation of rental properties is computed on a straight-line basis over the estimated useful lives of the assets. The estimated lives of our assets by class are as follows:

We make subjective assessments as to the useful lives of our assets. These assessments have a direct impact on our net income. Should we lengthen the expected useful life of an asset, it would be depreciated over a longer period, resulting in less depreciation expense and higher annual net income. Should we shorten the expected useful life of an asset, it would be depreciated over a shorter period, resulting in more depreciation expense and lower annual net income.

We assess the useful lives of our assets on a regular basis. If events or changes in circumstances indicate that the carrying value of a rental property to be held and used or land held for development may be impaired, we perform a recoverability analysis based on estimated undiscounted cash flows to be generated from the property in the future. If the analysis indicates that the carrying value is not recoverable from future cash flows, the property and related assets such as tenant improvements and lease commissions, are written down to estimated fair value and an impairment loss is recognized. If we decide to sell rental properties or land holdings, we evaluate the recoverability of the carrying amounts of the assets. If the evaluation indicates that the carrying value is not recoverable from estimated net sales proceeds, the property is written down to estimated fair value less costs to sell and an impairment loss is recognized. Our estimates of cash flows and fair values of the properties are based on current market conditions and consider matters such as rental rates and occupancies for comparable properties, recent sales data for comparable properties and, where applicable, contracts or the results of negotiations with purchasers or prospective purchasers. Changes in estimated future cash flows due to changes in our plans or views of market and economic conditions could result in recognition of additional impairment losses which, under applicable accounting guidance, could be substantial.

During the remainder of 2005, we are anticipating marketing 7 operating properties for sale. As a result, we have reduced the estimated holding periods for these properties. Of these operating properties, two, Quorum Place and 5000

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Management’s Discussion and Analysis

Quorum in Dallas, Texas, have book values in excess of our estimate of their current fair market values less costs to sell and net operating cash receipts during their shortened holding periods. We recognized impairment losses of $1.8 million and $2.2 million, respectively, on these two properties.

We allocate the purchase cost of acquired properties to the related physical assets and in-place leases based on their fair values. The fair values of acquired office buildings are determined on an “if-vacant” basis considering a variety of factors, including the physical condition and quality of the buildings, estimated rental and absorption rates, estimated future cash flows and valuation assumptions consistent with current market conditions. The “if-vacant” fair value is allocated to land, where applicable, buildings, tenant improvements and equipment based on property tax assessments and other relevant information obtained in connection with the acquisition of the property.

The fair value of in-place leases includes the effect of leases with above or below market rents, where applicable, customer relationship value and the cost of acquiring existing tenants at the date of acquisition. Above market and below market in-place lease values are determined on a lease by lease basis based on the present value (using an interest rate which reflects the risks associated with the leases acquired) of the difference between (a) the contractual amounts to be paid under the lease and (b) our estimate of the fair market lease rate for the corresponding space over the remaining non-cancelable terms of the related leases. The capitalized below market lease values are amortized as an increase to rental income over the initial term and any below market renewal periods of the related leases. Capitalized above market lease values are amortized as a decrease to rental income over the initial term of the related leases. Customer relationship values are determined based on our evaluation of the specific characteristics of each tenant’s lease and our overall relationship with the tenant. Characteristics we consider include the nature and extent of our existing business relationships with the tenant, growth prospects for developing new business with the tenant, the tenant’s credit quality and expectations of lease renewals. The value of customer relationship intangibles is amortized to expense over the lesser of the initial lease term and any expected renewal periods or the remaining useful life of the building. We determine the fair value of the cost of acquiring existing tenants by estimating the lease commissions avoided by having in-place tenants and avoided lost operating income for the estimated period required to lease the space occupied by existing tenants at the acquisition date. The cost of acquiring existing tenants is amortized to expense over the initial term of the respective leases. Should a tenant terminate its lease, the unamortized portion of the in-place lease value is charged to expense. Changes in the assumptions used in the allocation of the purchase cost among the acquired assets would affect the timing of recognition of the related revenue and expenses.

Our allowance for doubtful accounts receivable is established based on analysis of the risk of loss on specific accounts. The analysis places particular emphasis on past-due accounts and considers information such as the nature and age of the receivable, the payment history of the tenant or other debtor, the amount of security we hold, the financial condition of the tenant and our assessment of its ability to meet its lease obligations, the basis for any disputes and the status of related negotiations, etc. Our estimate of the required allowance, which is reviewed on a quarterly basis, is subject to revision as these factors change and is sensitive to the effects of economic and market conditions on our tenants, particularly in our largest markets. Bad debt expense was $192,000 and $55,000 for the three months ended March 31, 2005 and 2004, respectively.

RESULTS OF OPERATIONS

Operating results are summarized as follows:

Operating revenues decreased $0.6 million (2.4%) for the first quarter of 2005 compared to 2004. This decrease was due primarily to lower recoveries from tenants which were partially offset by an increase in parking and other tenant charges.

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Management’s Discussion and Analysis

Our lease rollover by square footage at March 31, 2005 is as follows:

Property operating expenses remained the same in the three months ended March 31, 2005 compared to the same period in 2004. However, operating expenses increased $0.1 million while real estate taxes decreased by $0.1 million.

General and administrative expense increased $0.2 million (8.7%) in the three months ended March 31, 2005 compared to the same period in 2004. The increase was due primarily to increased allocations of expense from CarrAmerica.

Depreciation and amortization increased $0.2 million (2.5%) in the three months ended March 31, 2005, compared to the same period in 2004. The increase was due primarily to the increase in tenant improvements.

Interest expense decreased $0.6 million (25.0%) in the three months ended March 31, 2005 compared to the same period in 2004. The decrease was primarily due to the decrease of mortgages and notes payable of $15.1 in 2004 as a result of repayments of higher rate mortgages.

The table below summarizes our property sale for the three months ended March 31, 2004:

We dispose of assets from time to time that are inconsistent with our long-term strategic or return objectives. During the three months ended March 31, 2005 we did not dispose of any operating properties. During the three months ended March 31, 2004, we disposed of our Tower of the Hills property, recognizing a gain of $0.1 million. We have no continuing involvement with the Tower of the Hills property after the sale and, accordingly, the gain on this sale and the operating results of this property are classified as discontinued operations. We had previously recognized an impairment loss of $3.0 million on this property in the fourth quarter of 2003.

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Management’s Discussion and Analysis

Operating results of the Tower of the Hills property are summarized as follows:

During the remainder of 2005, we are anticipating marketing 7 operating properties for sale. As a result we have reduced the estimated holding periods for these properties. Of these operating properties, two, Quorum Place and 5000 Quorum in Dallas, Texas, have book values in excess of our estimate of their current fair market values less costs to sell and net operating cash receipts during their shortened holding periods. As a result, we recognized impairment losses of $1.8 million and $2.2 million, respectively, on these two properties. All of the properties currently do not meet our criteria to be classified as held for sale or discontinued operations.

Consolidated Cash Flows

Consolidated cash flow information is summarized as follows:

Operations generated $4.7 million of net cash for the first three months of 2005 compared to $9.4 in the same period of 2004. The decrease in cash provided by operating activities was due primarily to the reduction in accounts payable and accrued expenses ($4.5 million). The level of net cash provided by operating activities is affected by the timing of receipt of revenues and payment of expenses.

Our investing activities used net cash of $2.5 million in the three months ended March 31, 2005 compared to providing net cash of $8.3 million in the same period of 2004. The net change in cash flows from investing activities in 2005 was due primarily to a decrease in proceeds from the sale of property ($10.5 million) and increases in contributions to unconsolidated subsidiaries ($1.3 million) partially offset by a decrease in acquisition and development of property ($0.8 million).

Our financing activities used net cash of $2.1 million for the first three months of 2005 and $17.2 million for the same period in 2004. The net change in cash flows from financing activities is primarily a result of the decrease in cash used to repay amounts due to affiliates ($9.3 million) and mortgages and notes payable ($5.7 million) in 2004.

LIQUIDITY AND CAPITAL RESOURCES

Our liquidity and capital resources are dependent upon CarrAmerica and its other affiliates. CarrAmerica’s primary sources of capital are real estate operations and its senior unsecured credit facility. On June 30, 2004, CarrAmerica entered into a new $500.0 million, three-year unsecured revolving credit facility with JPMorgan Chase Bank as administrative agent for a syndicate of banks. The facility replaced and was used to repay all amounts outstanding under CarrAmerica’s previous senior unsecured credit facility. CarrAmerica may increase the facility to $700.0 million by request at any time within 24 months of the closing, provided the funding commitments are increased accordingly. The facility can be extended one year at CarrAmerica’s option. The facility carries an interest rate of 65 basis points over 30-day LIBOR, or 3.52% as of March 31, 2005. As of March 31, 2005, $388.0 million was drawn on the credit facility, $35.9 million in letters of credit were outstanding, and CarrAmerica had $76.1 million available for borrowing. As of April 1, 2005, after the application of cash proceeds from CarrAmerica’s partial sale of CarrAmerica Corporate Center to a new a joint venture, $248.0 million was drawn on the credit facility and $216.1 million was available for borrowing.

We and CarrAmerica derive substantially all of our revenue from tenants under leases at our properties. Our

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Management’s Discussion and Analysis

operating cash flow therefore depends materially on the rents that we are able to charge to our tenants, and the ability of these tenants to make their rental payments. Our primary uses of cash are to fund distributions to Unitholders, to fund capital investments in our existing portfolio of operating assets, and to fund new acquisitions and our development activities. We regularly require capital to invest in our existing portfolio of operating assets in connection with large-scale renovations, routine capital improvements, deferred maintenance on properties we have recently acquired, and our leasing activities, including funding tenant improvements, allowances and leasing commissions. The amounts of the leasing-related expenditures can vary significantly depending on negotiations with tenants and the willingness of tenants to pay higher base rents over the life of the leases.

During the remainder of 2005, we expect that we will have significant capital requirements, including the following items. There can be no assurances that our capital requirements will not be materially higher or lower than these expectations.

We expect to meet our capital requirements using cash generated by our real estate operations.

We believe that we will generate sufficient cash flow from operations and have access to the capital resources necessary to expand and develop our business, to fund our operating and administrative expenses, to continue to meet our debt service obligations, to pay distributions to Unitholders, to acquire additional properties and land, and to pay for construction in progress. However, as a result of general economic downturns, if CarrAmerica’s credit rating is downgraded, if rental rates on new leases are significantly lower than expiring leases or if our properties do not otherwise perform as expected, we may not generate sufficient cash flow from operations or otherwise have access to capital on favorable terms, or at all. If we cannot raise the expected funds from the sale of properties and/or if we are unable to obtain capital from other sources, we may not be able make required principal and interest payments, make strategic acquisitions or make necessary routine capital improvements with respect to our existing portfolio of operating assets. Any of these events could have a material adverse effect on our liquidity, financial condition, results of operations and the value of our securities. In addition, if a property is mortgaged to secure payment of indebtedness and we are unable to meet mortgage payments, the holder of the mortgage could foreclose on the property, resulting in loss of income and asset value. An unsecured lender could also attempt to foreclose on some of our assets in order to receive payment. In most cases, very little of the principal amount that we borrow is repaid prior to the maturity of the loan. We may refinance that debt when it matures, or we may pay off the loan. If principal amounts due at maturity cannot be refinanced, extended or paid with proceeds of other capital transactions, such as new equity capital, our cash flow may be insufficient to repay all maturing debt. Prevailing interest rates or other factors at the time of a refinancing (such as possible reluctance of lenders to make commercial real estate loans) may result in higher interest rates and increased interest expense.

Under our partnership agreement, to the extent that there is available cash, each Class A Unit, Class D Unit, and Class E Unit is entitled to receive a distribution equal to the amount of dividend per common share that is paid to CarrAmerica’s shareholders. Once all of the holders of these units have received their distribution, all additional available cash may be distributed to the holders of Class B Units. Cash flows from operations are an important factor in our ability to sustain our quarterly distributions to our partners at the current rate of $0.50 per unit per quarter. Cash flows from operations decreased from $9.4 million in the first quarter of 2004 to $4.7 million for the same period in 2005. We expect our cash flows from operations to be lower in 2005 than 2004. We currently expect to maintain our distribution rate of $0.50 per unit per quarter for the remainder of 2005. We expect our operating cash flow will be sufficient to maintain these distributions. In the event available cash is insufficient to pay distributions at the current level, we may be unable to make distributions to Class B Unitholders.

DEBT FINANCING

CarrAmerica’s unsecured credit facility contains financial and other covenants with which it must comply. Some of these covenants include:

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Management’s Discussion and Analysis

As of March 31, 2005, CarrAmerica was in compliance with all debt covenants. However, CarrAmerica’s and our ability to draw on the unsecured credit facility or to incur other unsecured debt in the future could be restricted by the covenants. During the first quarter of 2005, CarrAmerica amended its credit facility increasing the maximum ratio of total debt to tangible fair market value of CarrAmerica’s assets to 60%. In addition, the capitalization rate used to compute the fair market value of CarrAmerica’s assets for purposes of calculating this ratio was decreased from 9.0% to 8.5% for properties located in the Washington, D.C. Metropolitan area.

Failure to comply with any of the covenants under CarrAmerica’s unsecured credit facility or other debt instruments could result in a default under one or more of its debt instruments. This could cause CarrAmerica’s lenders to accelerate the timing of payments and would therefore have a material adverse effect on CarrAmerica’s and our business, operations, financial condition or liquidity.

Our total debt as of March 31, 2005 is summarized as follows:

Our fixed rate debt bore an effective weighted average interest rate of 7.77% at March 31, 2005 and had a weighted average maturity of 4.5 years. The effective weighted average interest rate of our fixed rate debt, excluding our notes payable to affiliates, was 6.91% at March 31, 2005 and had a weighted average maturity of 4.0 years. Our variable rate note payable to affiliate at March 31, 2005 bore an interest rate of 100 basis points over 30-day LIBOR or 3.87%. We repaid $0.3 and $6.0 million of fixed rate mortgage debt and notes payable in the first quarter of 2005 and 2004, respectively.

Capital Commitments

We regularly incur expenditures in connection with the re-leasing of office space, principally in the form of tenant improvements and leasing commissions. The amounts of these expenditures can vary significantly, depending on negotiations with tenants and the willingness of tenants to pay higher base rents over the life of the leases. We expect to pay for these capital expenditures out of cash from operations or, to the extent necessary, borrowings from CarrAmerica. We believe that these expenditures are generally recouped in the form of continuing lease payments.

Unconsolidated Investments and Joint Ventures

We have investments in real estate joint ventures in which we hold 21.2% to 49% interests. These investments are accounted for using the equity method and therefore the assets and liabilities of the joint ventures are not included in our financial statements. These joint ventures own and operate office buildings financed by non-recourse debt obligations that are secured only by the real estate and other assets of the joint ventures. We have no obligation to repay these non-recourse debt obligations and the lenders have no recourse to our other assets.

Our investments in these joint ventures are subject to risks not inherent in our majority owned properties, including:

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Management’s Discussion and Analysis

Off Balance Sheet Arrangements - Guarantee Obligations

We have unconditionally guaranteed unsecured notes issued by CarrAmerica to institutional and other investors. The aggregate principal amount of the unsecured notes was $1.275 and 1.375 billion as of March 31, 2005 and December 31, 2004, respectively. These notes are in the following form:

CarrAmerica’s senior unsecured notes contain various covenants with which CarrAmerica must comply. The covenants include:

As of March 31, 2005, CarrAmerica was in compliance with its unsecured note covenants.

$100.0 million of senior unsecured notes matured on March 1, 2005 and were repaid on that date using borrowings from CarrAmerica’s unsecured credit facility.

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Management’s Discussion and Analysis

Building and Lease Information

The following table sets forth information about each wholly-owned property as of March 31, 2005:

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Management’s Discussion and Analysis

FORWARD-LOOKING STATEMENTS

Statements contained in this Form 10-Q which are not historical facts may be forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”). We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 21E of the Exchange Act. Such statements (none of which is intended as a guarantee of performance) are subject to certain risks and uncertainties, which could cause our actual future results, achievements or transactions to differ materially from those projected or anticipated. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date this Form 10-Q is filed with the SEC. A number of important factors could cause actual results to differ materially from those indicated by the forward-looking statements, including, but not limited to, the risks described in our annual report on Form 10-K for the year ended December 31, 2004. Such factors include, among others:

For further discussion of these and other factors that could impact our future results, performance, achievements or transactions, see the documents we file from time to time with the Securities and Exchange Commission, and in particular, the section titled “The Company – Risk Factors” in CarrAmerica’s Annual Report on Form 10-K for the year ended December 31, 2004.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

Any significant changes in our market risk that have occurred since the filing of our Annual Report on Form 10-K for the year ended December 31, 2004 are summarized in the Liquidity and Capital Resources section of the Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Evaluation was performed under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness as of March 31, 2005 of the design and operation of our disclosure controls and procedures as defined in Rule 13a-15 of the rules promulgated under the Securities and Exchange Act of 1934, as amended. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the design and operation of these disclosure controls and procedures were effective as of the end of the period covered by this report.

Changes in Internal Controls over Financial Reporting

There has been no change in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934) identified in connection with the evaluation required by Rule 13a-15(b) under the Securities Exchange Act of 1934 of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of March 31, 2005 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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Part II

OTHER INFORMATION

Item 1. Legal Proceedings

We are party to a variety of other legal proceedings arising in the ordinary course of business. All of these matters, taken together, are not expected to have a material adverse impact on us. Based on currently available facts, we believe that the disposition of matters that are pending or asserted will not have a material adverse effect on our consolidated financial position, results of operations or liquidity.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Pursuant to our partnership agreement, minority interest units may be redeemed by us or one of our affiliates for either cash or common stock of CarrAmerica. The following table summarizes the number and average price for redemptions of third party units during the three months ended March 31, 2005:

Item 6. Exhibits

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SIGNATURES

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 thereunto duly authorized.

Date: May 5, 2005

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