UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10 - Q

(Mark One)

      |X|   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
            EXCHANGE ACT OF 1934

            For the quarterly period ended September 30, 2005

                                       OR

      |_|   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
            EXCHANGE ACT OF 1934

            For the transition period _________ to __________.

                         Commission File Number: 0-32615


                        Franklin Street Properties Corp.
             (Exact name of registrant as specified in its charter)


              Maryland                              04-3578653
  (State or other jurisdiction of       (IRS Employer Identification Number)
   incorporation or organization)


                         401 Edgewater Place, Suite 200
                            Wakefield, MA 01880-6210
                    (Address of principal executive offices)

                  Registrant's telephone number: (781) 557-1300

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 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past ninety 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     |X|                         NO     |_|

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act).

         YES     |_|                         NO     |X|

The number of shares of common stock outstanding as of October 27, 2005 was
60,525,608.

<PAGE>


                        Franklin Street Properties Corp.

                                    Form 10-Q

                                Quarterly Report
                               September 30, 2005

                                Table of Contents

                                                                            Page
                                                                            ----
Part I.  Financial Information

         Item 1.  Financial Statements

                  Consolidated Balance Sheets as of September 30, 2005 and
                  December 31, 2004.......................................     3

                  Consolidated Statements of Income for the three and
                  nine months ended September 30, 2005 and 2004...........     4

                  Consolidated Statements of Cash Flows for the
                  nine months ended September 30, 2005 and 2004...........     5

                  Notes to Consolidated Financial Statements..............  6-16

         Item 2.  Management's Discussion and Analysis of Financial
                  Condition and Results of Operations..................... 17-30

         Item 3.  Quantitative and Qualitative Disclosures about
                  Market Risk.............................................    31

         Item 4.  Controls and Procedures.................................    32

Part II. Other Information

         Item 1.  Legal Proceedings.......................................    33

         Item 2.  Unregistered Sales of Equity Securities and
                  Use of Proceeds.........................................    33

         Item 3.  Defaults upon Senior Securities.........................    33

         Item 4.  Submission of Matters to a Vote of Security Holders.....    33

         Item 5.  Other Information.......................................    33

         Item 6.  Exhibits................................................    34

Signatures        ........................................................    35

<PAGE>

                         PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

                        Franklin Street Properties Corp.
                           Consolidated Balance Sheets
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                           September 30,   December 31,
(in thousands, except shares and par value amounts)                             2005           2004
=======================================================================================================

<S>                                                                         <C>            <C>
Assets:
Real estate investments, at cost:
   Land                                                                     $  79,809      $  53,629
   Buildings and improvements                                                 514,336        327,633
   Fixtures and equipment                                                         599            599
-------------------------------------------------------------------------------------------------------
                                                                              594,744        381,861
   Less accumulated depreciation                                               32,503         23,950
-------------------------------------------------------------------------------------------------------

Real estate investments, net                                                  562,241        357,911
Acquired real estate leases, net of accumulated amortization of
  $8,220 and $3,000, respectively                                              33,225          6,464
Investment in non-consolidated REITs                                            5,040          4,270
Assets held for syndication                                                        --         59,246
Assets held for sale                                                           41,830         83,045
Cash and cash equivalents                                                      66,215         52,752
Restricted cash                                                                 1,338          1,033
Tenant rent receivables, less allowance for doubtful accounts of
  $350 and $350, respectively                                                     636            769
Straight-line rent receivables, less allowance for doubtful accounts of
  $460 and $460, respectively                                                   5,240          4,122
Prepaid expenses                                                                1,185            901
Other assets                                                                      637          1,097
Office computers and furniture, net of accumulated depreciation of
  $698 and $597, respectively                                                     322            374
Deferred leasing commissions, net of accumulated amortization of
  $939 and $689, respectively                                                   1,330          1,127
-------------------------------------------------------------------------------------------------------

    Total assets                                                            $ 719,239      $ 573,111
=======================================================================================================

Liabilities and stockholders' equity:

Liabilities:
Bank note payable                                                           $  37,135      $  59,439
Accounts payable and accrued expenses                                          12,653          8,846
Accrued compensation                                                            1,601            705
Acquired unfavorable leases                                                       552             --
Tenant security deposits                                                        1,384          1,033
-------------------------------------------------------------------------------------------------------

    Total liabilities                                                          53,325         70,023
-------------------------------------------------------------------------------------------------------

Commitments and contingencies

Stockholders' equity:
   Preferred stock, $.0001 par value, 20,000,000 shares
     authorized, none issued or outstanding                                        --             --
   Common stock, $.0001 par value, 180,000,000 shares authorized
     60,525,608 and 49,630,338 issued and outstanding, respectively                 6              5
   Additional paid-in capital                                                 677,397        512,813
   Treasury stock, 898 and 575 shares, respectively                               (16)           (10)
   Distributions in excess of earnings                                        (11,473)        (9,720)
-------------------------------------------------------------------------------------------------------

   Total stockholders' equity                                                 665,914        503,088
-------------------------------------------------------------------------------------------------------

   Total liabilities and stockholders' equity                               $ 719,239      $ 573,111
=======================================================================================================
</TABLE>

          See accompanying notes to consolidated financial statements.


                                        3
<PAGE>

                        Franklin Street Properties Corp.
                        Consolidated Statements of Income
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                For the                     For the
                                                           Three Months Ended          Nine Months Ended
                                                              September 30,               September 30,
----------------------------------------------------------------------------------------------------------
(in thousands, except per share amounts)                    2005         2004          2005         2004
==========================================================================================================

<S>                                                      <C>          <C>           <C>          <C>
Revenue:
  Rental                                                 $ 21,713     $ 13,672      $ 55,290     $ 44,675
Related party revenue:
  Syndication fees                                          2,856          155         6,977        8,603
  Transaction fees                                          2,850          467         6,888        9,209
  Management fees and interest income from loans              149          183         1,602          439
Other                                                           4           --            10            5
----------------------------------------------------------------------------------------------------------

    Total revenue                                          27,572       14,477        70,767       62,931
----------------------------------------------------------------------------------------------------------

Expenses:
  Real estate operating expenses                            4,961        2,797        11,842        8,458
  Real estate taxes and insurance                           2,826        1,690         7,296        5,572
  Depreciation and amortization                             4,218        2,639        11,130        8,256
  Selling, general and administrative                       2,034        1,626         5,601        4,921
  Commissions                                               1,457           98         3,648        4,384
  Interest                                                  1,082           --         2,825          517
----------------------------------------------------------------------------------------------------------

    Total expenses                                         16,578        8,850        42,342       32,108
----------------------------------------------------------------------------------------------------------

Income before interest income, equity in earnings of
  non-consolidated REITs and taxes on income               10,994        5,627        28,425       30,823
Interest income                                               451          139         1,048          498
Equity in earnings of non-consolidated REITs                  328           79         1,295          464
----------------------------------------------------------------------------------------------------------

Income before taxes on income                              11,773        5,845        30,768       31,785
Income tax expense                                            184         (216)          298          760
----------------------------------------------------------------------------------------------------------

Income from continuing operations                          11,589        6,061        30,470       31,025
Income from discontinued operations                           910          884         2,962        2,815
Gain on sale of assets, net                                14,316           --        13,260           --
----------------------------------------------------------------------------------------------------------

Net income                                               $ 26,815     $  6,945      $ 46,692     $ 33,840
==========================================================================================================

Weighted average number of shares outstanding,
  basic and diluted                                        60,526       49,630        55,697       49,628
==========================================================================================================

Income from continuing operations                        $   0.19     $   0.12      $   0.55     $   0.63
Income from discontinued operations                          0.01         0.02          0.05         0.05
Gain on sale of assets, net                                  0.24           --          0.24           --
----------------------------------------------------------------------------------------------------------

Net income per share, basic and diluted                  $   0.44     $   0.14      $   0.84     $   0.68
==========================================================================================================
</TABLE>

          See accompanying notes to consolidated financial statements.


                                        4
<PAGE>

                        Franklin Street Properties Corp.
                      Consolidated Statements of Cash Flows
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                                For the
                                                                                            Nine Months Ended
                                                                                              September 30,
                                                                                        ------------------------
(in thousands)                                                                             2005          2004
================================================================================================================

<S>                                                                                     <C>            <C>
Cash flows from operating activities:
  Net income                                                                            $  46,692      $ 33,840
  Adjustments to reconcile net income to net cash provided by operating activities:
Gain on sale of assets, net                                                               (13,260)           --
    Depreciation and amortization expense                                                  13,030         9,984
    Amortization of above market lease                                                      2,956           176
    Sponsored REIT income during consolidation                                                 --          (423)
    Equity in earnings from non-consolidated REITs                                         (1,295)         (464)
    Distributions from non-consolidated REITs                                               1,087           852
    Shares issued as compensation                                                              31           162
Changes in operating assets and liabilities:
    Restricted cash                                                                          (305)          (57)
    Tenant rent receivables, net                                                              133           329
    Straight-line rents, net                                                               (1,167)         (893)
    Prepaid expenses and other assets, net                                                     56        (2,669)
    Accounts payable and accrued expenses                                                     799         3,534
    Accrued compensation                                                                      896          (485)
    Tenant security deposits                                                                  351            57
    Payment of deferred leasing commissions                                                  (510)         (548)
----------------------------------------------------------------------------------------------------------------

      Net cash provided by operating activities                                            49,494        43,395
----------------------------------------------------------------------------------------------------------------

Cash flows from investing activities:
     Acquisitions and additions to real estate investments and office equipment           (87,942)         (993)
     Investment in assets held for syndication, net                                        59,532         4,117
     Proceeds from sale of assets                                                          52,967            --
     Cash acquired through issuance of common stock in merger transaction                  10,621            --
     Merger costs paid                                                                       (402)           --
     Investment in non-consolidated REITs                                                      (9)       (4,257)
----------------------------------------------------------------------------------------------------------------

     Net cash provided by (used) for investing activities                                  34,767        (1,133)
----------------------------------------------------------------------------------------------------------------

Cash flows from financing activities:
     Distributions to stockholders                                                        (48,445)      (46,152)
     Repayments under bank note payable, net                                              (22,304)       (4,117)
     Purchase of treasury shares                                                              (16)         (156)
     Deferred financing costs                                                                 (33)           --
----------------------------------------------------------------------------------------------------------------

     Net cash used for financing activities                                               (70,798)      (50,425)
----------------------------------------------------------------------------------------------------------------

Net increase (decrease) in cash and cash equivalents                                       13,463        (8,163)
Cash and cash equivalents, beginning of period                                             52,752        58,793
----------------------------------------------------------------------------------------------------------------

Cash and cash equivalents, end of period                                                $  66,215      $ 50,630
================================================================================================================

Supplemental disclosure of cash flow information:
  Cash paid for:
    Interest                                                                            $   2,772      $    517
    Income taxes                                                                        $     481      $  1,450
  Non-cash investing and financing activities:
    Assets acquired through issuance of common stock in merger transaction, net         $ 153,943      $     --
</TABLE>


          See accompanying notes to consolidated financial statements.


                                        5
<PAGE>

                        Franklin Street Properties Corp.
                   Notes to Consolidated Financial Statements
                                   (Unaudited)

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

Organization

Franklin Street Properties Corp. ("FSP Corp." or the "Company") holds, directly
and indirectly, 100% of the interest in FSP Investments LLC, FSP Property
Management LLC, and FSP Holdings LLC. The Company also has a non-controlling
common stock interest in twelve corporations organized to operate as real estate
investment trusts ("REITs").

On May 30, 2003, the shareholders of the Company approved the Company's
acquisition by merger of 13 REITs (the "2003 Target REITs"). The mergers were
effective June 1, 2003 and, as a result, the Company issued 25,000,091 shares in
a tax-free exchange for all the outstanding preferred shares of the 2003 Target
REITs. The mergers were accounted for as a purchase and the acquired assets and
liabilities were recorded at their fair value.

On April 30, 2005, the Company acquired four real estate investment trusts (the
"Target REITs"), by the merger of the four Target REITs with and into four of
the Company's wholly-owned subsidiaries. Upon the consummation of these mergers,
the Company issued 10,894,994 shares of common stock to holders of preferred
stock in these Target REITs.

The Company operates in two business segments: real estate operations and
investment banking/investment services. Real estate operations include leasing
and interim acquisition financing, which generate rental income, loan
origination fees and development fees, and, through FSP Property Management,
provides asset management and property management services for the Sponsored
REITs. FSP Investments provides real estate investment and broker/dealer
services. FSP Investments' services include: (i) the organization of REIT
entities (the "Sponsored REITs"), which are syndicated through private
placements; (ii) sourcing of the acquisition of real estate on behalf of the
Sponsored REITs; and (iii) the sale of preferred stock in Sponsored REITs.

Properties

The following table summarizes the Company's investment in real estate assets,
excluding assets held for sale or syndication:

                                                                 As of
                                                             September 30,
                                                         2005          2004
                                                      ----------    ----------
       Residential real estate
              Number of properties                            1             4
              Number of apartments                          228           837

       Commercial real estate
              Number of properties                           27            24
              Square feet                             4,018,544     3,049,357

Basis of Presentation

The unaudited consolidated financial statements of the Company include all the
accounts of the Company and its wholly owned subsidiaries. All significant
intercompany balances and transactions have been eliminated. These financial
statements should be read in conjunction with the Company's financial statements
and notes thereto contained in the Company's Annual Report on Form 10-K for its
fiscal year ended December 31, 2004, as filed with the Securities and Exchange
Commission.

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 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. Operating results for the three and nine months ended September 30,
2005 are not necessarily indicative of the results that may be expected for the
year ending December 31, 2005 or for any other period.


                                       6
<PAGE>

                        Franklin Street Properties Corp.
                   Notes to Consolidated Financial Statements
                                   (Unaudited)

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

Reclassifications

Certain balances in the interim 2004 financial statements have been reclassified
to conform to presentation contained in the Company's Annual Report on Form 10-K
for its fiscal year ended December 31, 2004. The reclassifications primarily
were related to classifications of income and assets sold in 2005 as
discontinued in 2004; and Sponsored REIT income and expenses. Prior to December
31, 2004 the Company presented its proportionate share of Sponsored REIT's
revenues and expenses and has since reclassified those amounts to consolidate
the real estate operations activity from inception of the Sponsored REIT until
the initiation of syndication upon which the equity method of accounting is
applied. These reclassifications changed rental revenues, operating and
maintenance expenses, depreciation and amortization, other income and equity in
earnings of non-consolidated REITs. There was no change to income from
continuing operations or net income for any period presented as a result of
these reclassifications.

2. Investment Banking/Investment Services Activity

During the nine months ended September 30, 2005, the Company sold on a best
efforts basis, through private placements, preferred stock in the following
Sponsored REITs:

<TABLE>
<CAPTION>
                                                                  Date Syndication        Gross Proceeds
      Sponsored REIT                        Property Location     Completed               (in thousands)
      ---------------------------------------------------------------------------------------------------
      <S>                                   <C>                   <C>                      <C>
      FSP 505 Waterford Corp.               Plymouth, MN          January 28, 2005               3,000(1)

      FSP Galleria North Corp.              Dallas, TX            August 23, 2005               75,250(1)

      FSP Park Ten Development Corp.        Houston, TX           September 28, 2005            27,000
                                                                                          ---------------
                                            Total                                          $   105,250
                                                                                          ===============
</TABLE>

      1.    The syndication of FSP 505 Waterford Corp. and FSP Galleria North
            Corp. commenced in the fourth quarter of 2004.

3. Related Party Transactions and Investments in Non-Consolidated Entities

Investment in Sponsored REITs

At September 30, 2005, the Company held a common stock interest in twelve
Sponsored REITs, all of which were fully syndicated and the Company no longer
derives economic benefits or risks from the common stock interest that is
retained in these Sponsred REITs. The Company holds a preferred stock investment
in two of these Sponsored REITs, FSP Blue Lagoon Drive Corp. and FSP Park Ten
Development Corp., from which it continues to derive economic benefit and risk.

On September 29, 2005, the Company acquired 8.5 preferred shares (approximately
3.05%) of a Sponsored REIT, FSP Park Ten Development Corp. ("Park Ten
Development"), in exchange for the contribution of 2.9 acres of developable
land. The Company accounts for its investment in Park Ten Development under the
equity method.

The table below shows the Company's share of income and expenses from Sponsored
REITs prior to consolidation. Management fees of $13,000 for the nine months
ended September 30, 2004 and interest expense are eliminated in consolidation.


                                       7
<PAGE>

                        Franklin Street Properties Corp.
                   Notes to Consolidated Financial Statements
                                   (Unaudited)

3. Related Party Transactions and Investments in Non-Consolidated Entities
(continued)

                                                             Nine Months Ended
                                                               September 30,
(in thousands)                                               2005         2004
                                                             ----         ----

Operating Data:
Rental revenues                                            $    --      $ 1,372
Operating and maintenance expenses                              --         (423)
Depreciation and amortization                                   --         (220)
Interest expense                                                --         (308)
Interest income                                                 --           14
                                                           -------      -------
                                                           $    --      $   435
                                                           =======      =======

Equity in earnings of investment in non-consolidated REITs:

The following table includes equity in earnings of investments in
non-consolidated REITs:

                                                              Nine Months Ended
                                                                September 30,
(in thousands)                                               2005          2004
                                                             ----          ----

Equity in earnings of Sponsored REITs                       $1,101       $  281
Equity in earnings of Blue Lagoon                              194          183
Equity in earnings of Park Ten Development                      --           --
                                                            ------       ------
                                                            $1,295       $  464
                                                            ======       ======

Equity in earnings of investments in Sponsored REITs is derived from the
Company's share of income following the commencement of syndication of Sponsored
REITs. Following the commencement of syndication the Company exercises influence
over, but does not control these entities and investments are accounted for
using the equity method. Equity in earnings of Blue Lagoon and Park Ten
Development are derived from the Company's preferred stock investments in the
entities, which were acquired in January 2004 and September 2005, respectively.

The Company recorded distributions declared or received of $1,087,000 and
$852,000 from non-consolidated Sponsored REITs during the nine months ended
September 30, 2005 and 2004, respectively.

The Company has in the past acquired by merger entities similar to the Sponsored
REITs. On April 30, 2005, the Company acquired four Sponsored REITs (the Target
REITs) by merger. The Company's business model for growth may include the
potential acquisition by merger in the future of Sponsored REITs. The Company
has no legal or any other enforceable obligation to acquire or to offer to
acquire any Sponsored REIT. In addition, any offer (and the related terms and
conditions) that might be made in the future to acquire any Sponsored REIT would
require the approval of the boards of directors of the Company and the Sponsored
REIT and the approval of the shareholders of the Sponsored REIT.


                                       8
<PAGE>

                        Franklin Street Properties Corp.
                   Notes to Consolidated Financial Statements
                                   (Unaudited)

3. Related Party Transactions and Investments in Non-consolidated Entities
(continued)

At September 30, 2005, December 31, 2004 and September 30, 2004, the Company had
ownership interests in twelve, fifteen and twelve Sponsored REITs, respectively.

Summarized financial information for these non-consolidated Sponsored REITs is
as follows:

                                                September 30,       December 31,
                                                    2005                2004
                                                --------------------------------
                                                        (in thousands)
      Balance Sheet Data:
      Real estate, net                            $ 341,153           $ 457,140
      Other assets                                   75,883              91,678
      Total liabilities                              (6,986)            (83,484)
                                                  ---------           ---------
      Shareholders equity                         $ 410,050           $ 465,334
                                                  =========           =========

                                                              For the
                                                         Nine Months Ended
                                                           September 30,
                                                        2005            2004
                                                     --------------------------
                                                          (in thousands)
      Operating Data:
      Rental revenue                                  $ 45,954        $ 40,180
      Other revenue                                        779             490
      Operating and maintenance expenses               (18,759)        (13,925)
      Depreciation and amortization                    (10,109)         (8,274)
      Interest expense and commitment fees              (5,499)         (8,461)
                                                      --------        --------
      Net income                                      $ 12,366        $ 10,010
                                                      ========        ========

Syndication fees and Transaction fees:

The Company provides syndication and real estate acquisition advisory services
for Sponsored REITs for which it derives Syndication fee revenue. Transaction
fee revenues include: loan commitment fees and other fees that are recognized
upon an investor closing or upon the final investor closing of the Sponsored
REIT entity; and development fees that are generally recognized upon an investor
closing or at the time the Company has provided all required services and no
further contingencies exist. Syndication and transaction fees from
non-consolidated entities amounted to approximately $13,865,000 and $17,812,000
for the nine months ended September 30, 2005 and 2004, respectively.

Management fees and interest income from loans:

Asset management fees range from 1% to 5% of collected rents and the applicable
contracts are cancelable with 30 days notice. Asset management fee income from
non-consolidated entities amounted to approximately $514,000 and $425,000 for
the nine months ended September 30, 2005 and 2004, respectively. The Company is
typically entitled to interest on funds advanced to Sponsored REITs. The Company
recognized interest income of approximately $1,088,000 and $13,000 for the nine
months ended September 30, 2005 and 2004, respectively, relating to these loans.


                                       9
<PAGE>

                        Franklin Street Properties Corp.
                   Notes to Consolidated Financial Statements
                                   (Unaudited)

4. Merger Transactions

On April 30, 2005, the Company issued 10,894,994 shares of common stock, $0.0001
par value per share, in exchange for all of the outstanding preferred stock of
the Target REITs. The results of operations for each of Target REIT have been
included in the Company's consolidated financial statements since May 1, 2005.

The aggregate purchase price was approximately $164,564,000. On the acquisition
date, for each Target REIT, the appraised value of the property was allocated to
real estate investments and leases, including lease origination costs. 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). The value assigned to
buildings approximates their replacement cost; the value assigned to land
approximates its appraised value; and the value assigned to leases approximates
their fair value. Other assets and liabilities are recorded at their historical
costs, which approximates fair value. The following table summarizes the
estimated fair value of the assets acquired at the date of acquisition:

                                                        Value of Assets Acquired
                                                        ------------------------
                                                             (in thousands)

      Real estate assets                                       $  137,687
      Value of acquired real estate leases                         18,965
      Cash                                                         10,621
      Other assets                                                    229
      Liabilities assumed                                          (2,938)
                                                               ----------
      Total                                                    $  164,564
                                                               ==========

Pro forma operating results for the Company and the Target REITs are shown in
the following table. The results assume the mergers occurred and the shares of
the Company's stock were issued on January 1, 2004 and are not necessarily
indicative of what the Company's actual results of operations would have been
for the period indicated, nor do they purport to represent the results of
operations of any future period.

<TABLE>
<CAPTION>
                                             For Three Months Ended       For Nine Months Ended
                                                   September 30,               September 30,
(in thousands except per share amounts)         2005         2004           2005         2004
                                              --------     --------       --------     --------

<S>                                           <C>          <C>            <C>          <C>
Revenues                                      $ 27,572     $ 19,609       $ 77,323     $ 78,584
                                              --------     --------       --------     --------
Income from continuing operations             $ 11,589     $  7,156       $ 33,115     $ 36,694
                                              --------     --------       --------     --------
Net income                                    $ 26,815     $  8,040       $ 49,337     $ 39,509
                                              ========     ========       ========     ========

Weighted average shares outstanding             60,527       60,525         60,526       60,523
                                              ========     ========       ========     ========

Income from continuing operations per share   $   0.19     $   0.12       $   0.55     $   0.61
                                              ========     ========       ========     ========
Net income per share                          $   0.44     $   0.13       $   0.82     $   0.65
                                              ========     ========       ========     ========
</TABLE>


                                       10
<PAGE>

                        Franklin Street Properties Corp.
                 Notes to the Consolidated Financial Statements
                                   (Unaudited)

5. Bank Note Payable

The Company has a revolving line of credit agreement (the "Loan Agreement") with
a group of banks providing for borrowings at the Company's election of up to
$150,000,000. During August 2005 the loan agreement was amended and restated.
Borrowings under the Loan Agreement bear interest at either the bank's prime
rate (6.75% at September 30, 2005) or a rate equal to LIBOR plus 125 basis
points (5.02% at September 30, 2005). The balance outstanding was $37,135,000
and $59,439,000 at September 30, 2005 and December 31, 2004, respectively. The
weighted average interest rate on amounts outstanding during the nine months
ended September 30, 2005 was 5.27% and for the year ended December 31, 2004 was
approximately 3.62%.

The Loan Agreement includes restrictions on property liens and requires
compliance with various financial covenants. Financial covenants include the
maintenance of at least $1,500,000 in operating cash accounts, a minimum
unencumbered cash and liquid investments balance and tangible net worth; and
compliance with various debt and operating income ratios, as defined in the Loan
Agreement. The Company was in compliance with the Loan Agreement's financial
covenants as of September 30, 2005 and December 31, 2004. Borrowings under the
Loan Agreement mature on August 18, 2008.

6. 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 September 30, 2005 and
2004.

7. Business Segments

The Company operates in two business segments: real estate operations (including
real estate leasing, interim acquisition financing, development and
asset/property management) and investment banking/investment services (including
real estate acquisition and broker/dealer services). The Company has identified
these segments because this information is the basis upon which management makes
decisions regarding resource allocation and performance assessment. The
accounting policies of the reportable segments are the same as those described
in the "Significant Accounting Policies" in Note 2 to the Company's consolidated
financial statements included in its Annual Report on Form 10-K for the year
ended December 31, 2004. The Company's operations are located in the United
States of America.

The Company evaluates the performance of its reportable segments based on
several measures including Cash Available for Distribution ("CAD") as management
believes that CAD represents an important measure of the reportable segment's
activity and is an important consideration in determining distributions paid to
equity holders. The Company defines CAD as: net income as computed in accordance
with accounting principles generally accepted in the United States of America
("GAAP"); excluding gains or losses on the sale of real estate and non-cash
income from Sponsored REITs; plus certain non-cash items included in the
computation of net income (depreciation and amortization and straight-line rent
adjustments); plus distributions received from Sponsored REITs; plus the net
proceeds from the sale of land; less purchases of property and equipment
("Capital Expenditures") and payments for deferred leasing commissions, plus
proceeds from (payments to) cash reserves established at the acquisition date of
the property. Depreciation and amortization, gain or loss on the sale of real
estate and straight-line rents are an adjustment to CAD, as these are non-cash
items included in net income. Capital expenditures, payments of deferred leasing
commissions and the proceeds from (payments to) the funded reserve are an
adjustment to CAD, as they represent cash items not reflected in net income.

The funded reserve represents funds that the Company has set aside in
anticipation of future capital needs. These reserves are typically used for the
payment of Capital Expenditures, deferred leasing commissions and certain tenant
allowances; however, there are no legal restrictions on their use and they may
be used for any Company purpose. CAD should not be considered as an alternative
to net income (determined in accordance with GAAP), as an indicator of the
Company's financial performance, nor as an alternative to cash flows from
operating activities (determined in accordance with GAAP), nor as a measure of
the Company's liquidity, nor is it necessarily indicative of sufficient cash
flow to fund all of the Company's needs. Other real estate companies may define
CAD in a different manner. It is at the Company's discretion to retain a portion
of CAD for operational needs. We believe that in order to facilitate a clear
understanding of the results of the Company, CAD should be examined in
connection with net income and cash flows from operating, investing and
financing activities in the consolidated financial statements.


                                       11
<PAGE>

                        Franklin Street Properties Corp.
                   Notes to Consolidated Financial Statements
                                   (Unaudited)

7. Business Segments (continued)

<TABLE>
<CAPTION>
                                                                    Investment
(in thousands)                                                       Banking/
                                                      Real Estate   Investment
                                                      Operations     Services        Total
                                                      ----------     --------        -----
<S>                                                    <C>           <C>           <C>
Three Months Ended March 31, 2005
Net Income                                             $ 10,346      $     77      $ 10,423
Equity in income of non-consolidated REITs                 (665)           --          (665)
Distributions from non-consolidated REITs                   599            --           599
Depreciation and amortization                             3,598            34         3,632
Straight line rent                                         (307)           --          (307)
Capital Expenditures                                       (327)           --          (327)
Payment of deferred leasing costs                           (95)           --           (95)
Proceeds from funded reserves                               422            --           422
                                                       --------      --------      --------
Cash Available for Distribution                        $ 13,571      $    111      $ 13,682
                                                       ========      ========      ========
Three Months Ended June 30, 2005
Net Income                                             $  9,362      $     92      $  9,454
Estimated loss on sale of property                        1,055            --         1,055
Equity in income of non-consolidated REITs                 (303)           --          (303)
Distributions from non-consolidated REITs                   381            --           381
Depreciation and amortization                             5,448            37         5,485
Straight line rent                                         (417)           --          (417)
Capital Expenditures                                     (1,601)           --        (1,601)
Payment of deferred leasing costs                          (216)           --          (216)
Proceeds from funded reserves                             1,817            --         1,817
                                                       --------      --------      --------
Cash Available for Distribution                        $ 15,526      $    129      $ 15,655
                                                       ========      ========      ========
Three Months Ended September 30, 2005
Net Income                                             $ 26,545      $    270      $ 26,815
Gain on sale of assets, net                             (14,316)           --       (14,316)
Equity in income of non-consolidated REITs                 (328)           --          (328)
Distributions from non-consolidated REITs                   107            --           107
Depreciation and amortization                             6,834            30         6,864
Straight line rent                                         (443)           --          (443)
Capital Expenditures                                       (312)          (48)         (360)
Payment of deferred leasing costs                          (199)           --          (199)
Proceeds from funded reserves                               511            48           559
                                                       --------      --------      --------
Cash Available for Distribution                        $ 18,399      $    300      $ 18,699
                                                       ========      ========      ========
Nine Months Ended September 30, 2005
Net Income                                             $ 46,253      $    439      $ 46,692
Gain on sale of assets, net                             (13,260)           --       (13,260)
Equity in income of non-consolidated REITs               (1,295)           --        (1,295)
Distributions from non-consolidated REITs                 1,087            --         1,087
Depreciation and amortization                            15,878           101        15,979
Straight line rent                                       (1,167)           --        (1,167)
Capital Expenditures                                     (2,240)          (48)       (2,288)
Payment of deferred leasing costs                          (510)           --          (510)
Proceeds from funded reserves                             2,750            48         2,798
                                                       --------      --------      --------
Cash Available for Distribution                        $ 47,496      $    540      $ 48,036
                                                       ========      ========      ========
</TABLE>


                                       12
<PAGE>

                        Franklin Street Properties Corp.
                   Notes to Consolidated Financial Statements
                                   (Unaudited)

7. Business Segments (continued)

<TABLE>
<CAPTION>
                                                                    Investment
(in thousands)                                                       Banking/
                                                      Real Estate   Investment
                                                      Operations     Services        Total
                                                      ----------     --------        -----
<S>                                                    <C>           <C>           <C>
Three Months Ended March 31, 2004
Net Income                                             $ 12,739      $    480      $ 13,219
Sponsored REIT income during consolidation                 (247)           --          (247)
Equity in income of non-consolidated REITs                 (379)           --          (379)
Distributions from non-consolidated REITs                   582            --           582
Depreciation and amortization                             3,235            24         3,259
Straight line rent                                         (340)           --          (340)
Capital Expenditures                                       (100)          (17)         (117)
Payment of deferred leasing costs                          (151)           --          (151)
Proceeds from funded reserves                               251            --           251
                                                       --------      --------      --------
Cash Available for Distribution                        $ 15,590      $    487      $ 16,077
                                                       ========      ========      ========
Three Months Ended June 30, 2004
Net Income                                             $ 12,780      $    896      $ 13,676
Sponsored REIT income during consolidation                 (176)           --          (176)
Equity in income of non-consolidated REITs                   (6)           --            (6)
Distributions from non-consolidated REITs                   173            --           173
Depreciation and amortization                             3,501            55         3,556
Straight line rent revenue                                 (514)           --          (514)
Capital expenditures                                       (430)          (72)         (502)
Payment of deferred leasing costs                          (101)           --          (101)
Payments to (proceeds from) funded reserve                  531            --           531
                                                       --------      --------      --------
Cash Available for Distribution                        $ 15,758      $    879      $ 16,637
                                                       ========      ========      ========
Three Months Ended September 30, 2004
Net Income                                             $  7,247      $   (302)     $  6,945
Sponsored REIT income during consolidation                   --            --            --
Equity in income of non-consolidated REITs                  (79)           --           (79)
Distributions from non-consolidated REITs                    96            --            96
Depreciation and amortization                             3,312            33         3,345
Straight line rent revenue                                  (39)           --           (39)
Capital expenditures                                       (374)           --          (374)
Payment of deferred leasing costs                          (296)           --          (296)
Payments to (proceeds from) funded reserve                  659            --           659
                                                       --------      --------      --------
Cash Available for Distribution                        $ 10,526      $   (269)     $ 10,257
                                                       ========      ========      ========
Nine Months Ended September 30, 2004
Net Income                                             $ 32,766      $  1,074      $ 33,840
Sponsored REIT income during consolidation                 (423)           --          (423)
Equity in income of non-consolidated REITs                 (464)           --          (464)
Distributions from non-consolidated REITs                   851            --           851
Depreciation and amortization                            10,048           112        10,160
Straight line rent revenue                                 (893)           --          (893)
Capital expenditures                                       (904)          (89)         (993)
Payment of deferred leasing costs                          (548)           --          (548)
Payments to (proceeds from) funded reserve                1,441            --         1,441
                                                       --------      --------      --------
Cash Available for Distribution                        $ 41,874      $  1,097      $ 42,971
                                                       ========      ========      ========
</TABLE>


                                       13
<PAGE>

                        Franklin Street Properties Corp.
                   Notes to Consolidated Financial Statements
                                   (Unaudited)

7. Business Segments (continued)

<TABLE>
<CAPTION>
                                                                    Investment
                                                                     Banking/
                                                      Real Estate   Investment
(in thousands)                                        Operations     Services        Total
                                                      ----------     --------        -----
<S>                                                    <C>           <C>           <C>
Three Months Ended September 30, 2005
Revenue                                                $ 24,463      $  3,109      $ 27,572
Interest income                                             442             9           451
Interest expense                                          1,082            --         1,082
Income from discontinued operations                         910            --           910
Capital expenditures                                        511            48           559

Nine Months Ended September 30, 2005:
Revenue                                                $ 63,021      $  7,746      $ 70,767
Interest income                                           1,024            24         1,048
Interest expense                                          2,825            --         2,825
Income from discontinued operations                       2,962            --         2,962
Capital expenditures                                      2,750            48         2,798

Identifiable Assets at September 30, 2005:
Identifiable assets                                    $714,260      $  4,979      $719,239

Three Months Ended September 30, 2004
Revenue                                                $ 14,007      $    470      $ 14,477
Interest income                                             128            11           139
Interest expense                                             --            --            --
Income from discontinued operations                         884            --           884
Capital expenditures                                        670            --           670

Nine Months Ended September 30, 2004:
Revenue                                                $ 52,877      $ 10,054      $ 62,931
Interest income                                             466            32           498
Interest expense                                            517            --           517
Income from discontinued operations                       2,815            --         2,815
Capital expenditures                                      1,452            89         1,541

Identifiable Assets at September 30, 2004:
Identifiable assets                                    $511,641      $  3,571      $515,212
</TABLE>


                                       14
<PAGE>

                        Franklin Street Properties Corp.
                   Notes to Consolidated Financial Statements
                                   (Unaudited)

8. Cash Distributions

The Company declared and paid distributions as follows (in thousands, except per
share amounts):

                                          Distribution        Total
           Quarter Paid                    Per Share        Dividends
      -----------------------             ------------      ---------

      First quarter of 2005                 $ 0.31           $ 15,385
      Second quarter of 2005                $ 0.41           $ 20,349
      Third quarter of 2005                 $ 0.21           $ 12,711

      First quarter of 2004                 $ 0.31           $ 15,382
      Second quarter of 2004                $ 0.31           $ 15,385
      Third quarter of 2004                 $ 0.31           $ 15,385

The distribution in the second quarter of 2005 was paid on April 29, 2005 to
shareholders of record on April 19, 2005, in anticipation of the consummation of
the acquisition of the four Target REITs by merger on April 30, 2005, and was in
respect of the first four months of operations in 2005. The distribution in the
third quarter of 2005 was paid on August 29, 2005 to shareholders of record on
August 8, 2005, and was in respect of operations during May and June 2005.

9. 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.

One such restriction is that the Company generally cannot own more than 10% of
the voting power or value of the securities of any one issuer unless the issuer
is itself a REIT or a "taxable REIT subsidiary" ("TRS"). In the case of TRSs,
the Company's ownership of securities in all TRSs generally cannot exceed 20% of
the value of all of the Company's assets and, when considered together with
other non-real estate assets, cannot exceed 25% of the value of all of the
Company's assets. Effective January 1, 2001, a subsidiary of the Company has
elected to be treated as a TRS. As a result, FSP Investments operates as a
taxable corporation under the Code and has accounted for income taxes in
accordance with the provisions of Statement of Financial Accounting Standard
("SFAS") No. 109, Accounting for Income Taxes. Taxes are provided when FSP
investments has net profits for both financial statement and income tax
purposes.

Income taxes are recorded based on the future tax effects of the difference
between the tax and financial reporting bases of the Company's assets and
liabilities. In estimating future tax consequences, potential future events are
considered except for potential changes in income tax law or in rates.

The income tax expense reflected in the consolidated statements of income
relates only to the TRS. The expense differs from the amounts computed by
applying the Federal statutory rate of 34% to income before income taxes as
follows:

                                                                  For the
                                                             Nine Months Ended
                                                               September 30,
                                                              ---------------
      (in thousands)                                           2005     2004
                                                              ---------------

      Federal income tax expense at statutory rate            $  252   $  624
      Increase in taxes resulting from:
          State income taxes, net of federal impact               46      136
                                                              ---------------
                                                              $  298   $  760
                                                              ===============

No deferred income taxes were provided as there were no material temporary
differences between the financial reporting basis and the tax basis of the
taxable REIT subsidiary.


                                       15
<PAGE>

                        Franklin Street Properties Corp.
                   Notes to Consolidated Financial Statements
                                   (Unaudited)

10. Discontinued Operations

During June 2005 an agreement was reached to sell a property called Blue Ravine,
which is located in Folsom, California. The sale was completed on July 13, 2005
and resulted in a loss of approximately $1,127,000. The property had been vacant
since mid-2003. The offer to purchase the property was compared to estimated
future costs to convert the property from a single tenant to a multi-tenant
facility and lease the building. The Company concluded that accepting the offer
was the more prudent decision because the management time and oversight of such
a conversion outweighed the potential future benefit.

During September 2005 the Company sold a residential property called Mansions in
the Park, which is located in Baton Rouge, Louisiana, and sold by transfer of
its interest, an office property called Gateway Crossing, which is located in
Columbia, Maryland at gains, which aggregated approximately $14,048,000. Also
during September 2005 an agreement was reached to sell two other residential
properties called Essex House and Gael Apartments, which are located adjacent to
each other in Houston, Texas; and an agreement was reached to sell an office
property called Telecom Business Center in San Diego, California. The
residential properties were sold on October 4 and 5, 2005, and Telecom Business
Center is expected to be sold in December 2005. Each of these properties is
anticipated to be sold at a gain. The total gains for the three sales are
expected to be approximately $17,100,000.

Accordingly, as of September 30, 2005 the three properties that are held for
sale is classified as such on the accompanying balance sheet. And income from
all properties sold or to be sold is classified as discontinued operations as
presented in the table below.

<TABLE>
<CAPTION>
                                                Three Months Ended             Nine Months Ended
                                                  September 30,                  September 30,
                                             ----------------------         ----------------------
                                                2005           2004            2005           2004
                                                ----           ----            ----           ----

<S>                                          <C>            <C>             <C>            <C>
Revenue                                      $ 2,607        $ 2,675         $ 8,017        $ 8,119
Income from discontinued operations            $ 910          $ 884         $ 2,962        $ 2,815
</TABLE>

During the first and third quarters of 2005 the Company acquired two office
properties, one in Englewood, Colorado and another in Indianapolis, Indiana,
which were acquired through borrowings under the Loan Agreement. The sale of
assets completed in September and October 2005 raised proceeds to repay these
borrowings.

The Company will continue to evaluate its portfolio, and from time-to-time may
decide to dispose of properties.

11. Subsequent Events

On October 4, 2005 the Company completed the sale of Essex House for
approximately $14.0 million. On October 5, 2005 the Company completed the sale
of Gael Apartments for approximately $23.1 million. Proceeds from the two sales
were used to repay the outstanding balance on the Loan Agreement on October 6,
2005. Following the repayment there were no amounts outstanding on the Loan
Agreement.

On October 5, 2005, the Board of Directors of the Company declared a cash
dividend of $0.31 per share of common stock payable on November 21, 2005 to
stockholders of record on October 31, 2005. The cash dividend represents three
months of operations, and the aggregate amount of dividends declared during 2005
is $1.24 per share.

On October 28, 2005, the Board of Directors of the Company authorized the
repurchase of up to $35 million of the company's common stock from time to time
on the open market or in privately negotiated transactions.


                                       16
<PAGE>

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

      The following discussion should be read in conjunction with the financial
statements and notes thereto appearing elsewhere in this report and in our
Annual Report on Form 10-K for the year ended December 31, 2004. Historical
results and percentage relationships set forth in the consolidated financial
statements, including trends which might appear, should not be taken as
necessarily indicative of future operations. The following discussion and other
parts of this Quarterly Report on Form 10-Q may also contain forward-looking
statements based on current judgments and current knowledge of management, which
are subject to certain risks, trends and uncertainties that could cause actual
results to differ materially from those indicated in such forward looking
statements. Accordingly, readers are cautioned not to place undue reliance on
forward-looking statements. Investors are cautioned that our forward-looking
statements involve risks and uncertainty, including without limitation changes
in economic conditions in the markets in which we own properties, changes in the
demand by investors for investment in Sponsored REITs, risks of a lessening of
demand for the types of real estate owned by us, changes in government
regulations, and expenditures that cannot be anticipated such as utility rate
and usage increases, unanticipated repairs, additional staffing, insurance
increases and real estate tax valuation reassessments. See the factors set forth
below under the caption, "Certain Factors That May Affect Future Results".
Although we believe the expectations reflected in the forward looking statements
are reasonable, we cannot guarantee future results, levels of activity,
performance or achievements. We will not update any of the forward looking
statements after the date of this Quarterly Report on Form 10-Q is filed to
conform them to actual results or to changes in our expectations that occur
after such date, other than as required by law.

Overview

      FSP Corp. operates in two business segments: real estate operations and
investment banking/investment services. The real estate operations segment
involves real estate rental operations, leasing, interim acquisition financing,
development services and asset/property management services. The investment
banking/investment services segment involves providing real estate investment
and broker/dealer services that include the organization of Sponsored REITs, the
acquisition of real estate on behalf of Sponsored REITs and the syndication of
Sponsored REITs through the sale of preferred stock in private placements.

      The main factor that affects our real estate operations is the broad
economic market conditions in the United States. These market conditions affect
the occupancy levels and the rent levels on both a national and local level. We
have no influence on the national market conditions. We look to acquire quality
properties in good locations in order to lessen the impact of downturns in the
local markets and to take advantage of upturns in these same local markets when
they occur.

      Our investment banking/investment services customers are primarily
institutions and high net-worth individuals. To the extent that the broad
capital markets affect these investors, our business is also affected. These
investors have many investment choices. We must continually search for real
estate at a price and at a competitive risk/reward rate of return that meets our
customer's risk/reward profile for providing a stream of income and as a
long-term hedge against inflation.

Critical Accounting Policies

      We have certain critical accounting policies that are subject to judgments
and estimates by our management and uncertainties of outcome that affect the
application of these policies. We base our estimates on historical experience
and on various other assumptions we believe to be reasonable under the
circumstances. On an on-going basis, we evaluate our estimates. In the event
estimates or assumptions prove to be different from actual results, adjustments
are made in subsequent periods to reflect more current information. The
accounting policies that we believe are most critical to the understanding of
our financial position and results of operations, and that require significant
management estimates and judgments, are discussed in Item 7, Management's
Discussion and Analysis of Financial Conditions and Results of Operations in our
Annual Report on Form 10-K for the year ended December 31, 2004.

      Critical accounting policies are those that have the most impact on the
reporting of our financial condition and results of operations and those
requiring significant judgments and estimates. We believe that our judgments and
assessments are consistently applied and produce financial information that
fairly presents our results of operations.

      No changes to our critical accounting policies have occurred since our
Annual Report on Form 10-K for the year ended December 31, 2004.


                                       17
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations (continued)

Trends and Uncertainties

Real Estate Operations

      The trends in our office markets have remained consistent across the last
few quarters with slow employment growth leading to slow improvement in
occupancy and an almost imperceptible improvement in market rents. The economic
impact of Hurricanes Katrina and Rita and higher energy costs may affect those
trends in the future quarters. We expect certain markets, such as Houston, may
enjoy short-term benefits from the demand for space as a result of the
hurricanes, while most properties will see increased utility costs. While market
rents for new leases may be increasing in some areas, the new market rents are
generally lower than expiring rents in most of our markets, particularly for
those leases that were made at the height of the market four to five years ago.
We expect to continue to see a decrease in rents to market rents for leases at
our properties that expire during the rest of the year unless there is dramatic
improvement in market fundamentals.

      The uncertainty surrounding utility prices in the larger economy creates
uncertainty about our future utility costs. Although many of our leases pass
through the cost of utilities to the tenants, higher utility prices would
increase our overall operating costs.

      During 2005 we have sold or entered into an agreement to sell a total of
six properties. As of September 30, 2005, three of the six sales were completed,
and the remaining three have been classified in our balance sheet as
held-for-sale. In October 2005, we completed the sale of two of these properties
at a gain of approximately $10.2 million, and the last property is expected to
be sold at a gain in December.

      The following table summarizes property wholly owned by us as of the dates
indicated:

                                                              September 30,
                                                       -------------------------
                                                         2005            2004

      Residential:
        Number of properties                                   1               4
        Number of apartment units                            228             837

      Commercial:
        Number of properties                                  27              24
        Square footage                                 4,018,544       3,049,357

Investment Banking/Investment Services

      Unlike our real estate operations business, that provides a rental revenue
stream which is ongoing and recurring in nature, our investment
banking/investment services business is transactional in nature. Both the number
of Sponsored REIT syndications and the amount of equity anticipated to be raised
for the balance of 2005 are likely to be below our 2004 levels. Future business
in this area is very unpredictable.

      Our property acquisition executives continue to be concerned about high
valuation levels and increased competition for prime commercial investment real
estate in 2005. It appears that a combination of factors, the most dynamic of
which is a substantial increase to capital allocation for real estate assets, is
increasing prices on many properties we would have an interest in acquiring.
This upward pressure on prices is causing capitalization rates to fall and
prices per square foot to rise. Consequently, our acquisition executives are
having a difficult time identifying enough property during 2005 at a price
acceptable under our investment criteria to grow our overall investment
banking/investment services business. Lower revenues from this business continue
to negatively impact both earnings and CAD. As the fourth quarter of 2005
begins, valuation levels for many top quality investment properties remain at
historically high levels, with significant competition from a variety of capital
sources to acquire them. Lower capitalization rates on properties acquired for
investment syndication mean lower initial cash flow yields for potential equity
investors in our Sponsored REITs. Consequently a slower pace of sales of some of
these investments to our clients and prospective clients may occur. We expect
this trend to continue for the balance of 2005 and into 2006. We continue to
rely solely on our in-house investment executives to access interested investors
who have capital they can afford to place in an illiquid position for an
indefinite period of time (i.e., invest in a Sponsored REIT). We also continue
to evaluate our in-house sales force, as to whether we are capable, either
through our existing client base or through new clients, of raising sufficient
investment capital in Sponsored REITs to achieve future performance objectives.


                                       18
<PAGE>

      During the quarter ending September 30, 2005 we completed two investment
banking transactions: one was for an office property in Dallas, Texas, and the
other was for development of an office property in Houston, Texas. Another
investment banking transaction is planned for the fourth quarter.

Results of Operations

      The following table shows each segment for the three months ended
September 30, 2005 and 2004.

<TABLE>
<CAPTION>
      (in thousands)
                                                                      Three months ended September 30,
                                                                  --------------------------------------
      Real Estate Operations                                        2005           2004         Change
                                                                    ----           ----         ------
      <S>                                                         <C>            <C>            <C>
      Real estate:
        Rental income                                             $ 21,713       $ 13,672       $ 8,041
        Transaction fees                                             2,597            152         2,445
        Management fees and interest income from loans                 149            183           (34)
                Other                                                    4             --             4
                                                                  --------------------------------------
                                                                    24,463         14,007        10,456
                                                                  --------------------------------------
      Expenses:
        Real estate operating expenses                               4,961          2,797         2,164
        Real estate taxes and insurance                              2,826          1,690         1,136
        Depreciation and amortization                                4,188          2,606         1,582
        Interest                                                     1,082             --         1,082
                                                                  --------------------------------------
                                                                    13,057          7,093         5,964
                                                                  --------------------------------------
      Other items:
        Interest income                                                442            128           314
        Equity in earnings in non-consolidated REIT's                  328             79           249
                                                                  --------------------------------------
                                                                       770            207           563
                                                                  --------------------------------------

      Contribution from real estate                                 12,176          7,121         5,055
                                                                  --------------------------------------

      Investment Banking/Investment Services:
        Syndication fees                                             2,856            155         2,701
        Transaction fees                                               253            315           (62)
                                                                  --------------------------------------
                                                                     3,109            470         2,639
                                                                  --------------------------------------
      Expenses:
        Depreciation and amortization                                   30             33            (3)
        Commissions                                                  1,457             98         1,359
                                                                  --------------------------------------
                                                                     1,487            131         1,356
                                                                  --------------------------------------
      Other items:
        Interest income                                                  9             11            (2)
        Taxes on income                                               (184)           216          (400)
                                                                  --------------------------------------
                                                                      (175)           227          (402)
                                                                  --------------------------------------

      Contribution from investment banking/investment services       1,447            566           881
                                                                  --------------------------------------

      Selling, general and administrative expenses                   2,034          1,626           408
                                                                  --------------------------------------

      Income from discontinued operations                              910            884            26
      Gain on sale of assets, net                                   14,316             --        14,316
                                                                  --------------------------------------

        Net income                                                $ 26,815        $ 6,945      $ 19,870
                                                                  ======================================
</TABLE>

      On April 30, 2005 we completed the acquisition by merger of four Sponsored
REITs. The results of operations for these four properties are included in our
operating results as of May 1, 2005. We operated 28 properties for the first
four months of 2005 and 32 properties for May and June 2005. Increases in rental
revenues and expenses for the three and nine months ended September 30, 2005 as
compared to the three and nine months ended September 30, 2004 are primarily a
result of these mergers. On July 13, 2005 we sold one vacant office property in
California, and on September 16, 2005 and September 19, 2005 sold a residential
apartment building in Louisiana and sold by transfer of its interest, an office
property in Maryland. During the three and nine months ended September 30, 2004,
we operated 28 properties.


                                       19
<PAGE>

Comparison of the three months ended September 30, 2005 to the three months
ended September 30, 2004

      Total revenues increased $13.1 million, to $27.6 million for the three
months ended September 30, 2005, as compared to $14.5 million for the three
months ended September 30, 2004. Total expenses were $16.6 million for the three
months ended September 30, 2005; an increase of $7.7 million compared to the
three months ended September 30, 2004. The increase in revenues was primarily
attributable to increases in rental revenue as a result of the mergers described
above and an increase in revenue from our investment banking/investment services
business as a result of greater syndication proceeds during the three months
ended September 30, 2005 than the comparable period in 2004. The increase in
total expenses was primarily attributable to an increase in real estate expenses
associated with the mergers, direct expenses related to the increase in
investment banking/investment services revenues and an increase to selling,
general & administrative expenses.

      During the three months ended September 30, 2005 our investment
banking/investment services segment had total gross proceeds of $44.0 million,
which included the completion of the syndication of two Sponsored REITs. FSP
Galleria North Corp. was completed on August 23, 2005, and FSP Park Ten
Development Corp. was completed on September 28, 2005. During the three months
ended September 30, 2004, our investment banking/investment services segment had
total gross proceeds of $2.7 million, which included completion of the
syndication of one Sponsored REIT, FSP 1441 Main Street Corp. on July 26, 2004.
As a result, total gross proceeds increased $41.3 million for the three months
ended September 30, 2005 compared to three months ended September 30, 2004. This
increase in syndication activity illustrates the transactional nature of our
investment banking/investment services segment, where during the three months
ended September 30, 2005 the pace of syndications quickened and a suitable
development property was syndicated. During the three months ended September 30,
2004 the lower amount of proceeds was attributable to a slower pace of
syndication investment by our client base and a more difficult environment in
which to find suitable properties to syndicate. Revenues and expenses for
investment banking/investment services are directly related to the gross
proceeds of these syndications.

Each segment is discussed in greater detail below.

      Real Estate Operations

      Contribution from the real estate segment was $12.2 million for the three
months ended September 30, 2005, an increase of $5.1 million, compared to the
three months ended September 30, 2004. The increase is primarily attributable
to:

      o     An increase in real estate operating income of $4.7 million to $13.9
            million for the three months ended September 30, 2005 compared to
            $9.2 million for the comparable 2004 period. The increase primarily
            relates to the four properties owned by the Sponsored REITs which we
            acquired by merger on April 30, 2005, and two properties acquired in
            Colorado and Indiana. We define real estate operating income as
            rental revenues less real estate operating expenses, real estate
            taxes and insurance;
      o     An increase in transaction fee revenues of $2.4 million to $2.6
            million for the three months ended September 30, 2005 as compared to
            $0.2 million for the three months ended September 30, 2004. The
            increase was principally a result of the increase in gross
            syndication proceeds in the quarter compared to the same period in
            2004;
      o     An increase from equity in income from non-consolidated REITs of
            $0.3 million as a result of Sponsored REITs in syndication with
            greater net operating income during the three months ended September
            30, 2005 compared to the three months ended September 30, 2004;
      o     An increase to interest income of $0.3 million during the three
            months ended September 30, 2005, which was primarily a result of
            higher interest rates on cash and cash equivalents compared to the
            three months ended September 30, 2004.

      These decreases were partially offset by:

      o     An increase in interest expense of $1.1 million resulting from
            larger loan balances outstanding for assets acquired during 2005
            compared to the three months ended September 30, 2004, when there
            was no loan balance outstanding; and
      o     An increase to depreciation and amortization of $1.6 million to $4.2
            million for three months ended September 30, 2005 compared to $2.6
            million for the comparable 2004 period, which primarily relates to
            the four properties owned by the Sponsored REITs we acquired on
            April 30, 2005, and two properties acquired in Colorado and Indiana.


                                       20
<PAGE>

      Investment Banking/Investment Services

      Contribution from the investment banking and services segment increased
$0.9 million to $1.4 million for the three months ended September 30, 2005,
compared to $0.6 million for the three months ended September 30, 2004. The
increase is primarily attributable to:

      o     An increase in syndication and transaction fee revenues of $2.6
            million, which was primarily attributable to a higher level of gross
            syndication proceeds during the three months ended September 30,
            2005 compared to the three months ended September 30, 2004.

      This increase was partially offset by:

      o     A increase in commission expense of $1.4 million, which relates to
            the increase in gross syndication proceeds;
      o     An increase in tax expense of $0.4 million to $0.2 million for the
            three months ended September 30, 2005 as compared to a tax credit of
            $0.2 million for the three months ended September 30, 2004;

      Selling, general and administrative expenses

      Selling, general and administrative expenses arise primarily from
corporate related expenses and costs associated with our headquarters in
Wakefield, Massachusetts where both business segments are managed. Over the last
few years there has been a shift in expense and cost allocation between the
segments from being primarily related to investment banking activity to a
greater focus on real estate operations. This shift has occurred as a result of:

      o     The increase in the number of owned properties in our real estate
            portfolio, and related direct acquisition and disposition of real
            estate assets;
      o     The trend to a lower level of syndication proceeds from the
            investment banking segment;
      o     An increased level of management time related to our real estate
            operations.

      As a result of this internal shift, we compare the total selling, general
and administrative expenses from period-to-period as we believe it more
meaningful than comparison of allocated expenses to each segment.

      Selling, general and administrative costs increased $0.4 million to $2.0
million for the three months ended September 30, 2005 compared to $1.6 million
for the three months ended September 30, 2004, which were primarily from costs
of monitoring and managing a larger portfolio of REITs, expenses incurred
related to the public trading of our stock, which commenced on June 2, 2005, and
increases to franchise taxes. We had approximately 35 employees as of September
30, 2005 at our headquarters in Wakefield compared to 37 employees as of
September 30, 2004.

      Discontinued Operations

      During June 2005 an agreement was reached to sell a property called Blue
Ravine, which is located in Folsom, California. The sale was completed on July
13, 2005 and resulted in a loss of approximately $1,127,000. The property had
been vacant since mid-2003. The offer to purchase the property was compared to
estimated future costs to convert the property from a single tenant to a
multi-tenant facility and lease the building. The Company concluded that
accepting the offer was the more prudent decision because the management time
and oversight of such a conversion outweighed the potential future benefit.

      On September 29, 2005, we recorded a non-monetary exchange gain of
$339,000 from contribution of 2.9 acres of developable land we contributed in
exchange for 8.5 preferred shares (approximately 3.05%) of a Sponsored REIT, FSP
Park Ten Development Corp. ("Park Ten Development"). The appraised value of the
land and market value of the stock acquired were used to estimate the sale
price, and the gain was recorded net of the Company's interest in Park Ten
Development.

      During September 2005 the Company sold a residential property called
Mansions in the Park, which is located in Baton Rouge, Louisiana, and sold by
transfer of its interest, an office property called Gateway Crossing, which is
located in Columbia, Maryland at gains, which aggregated approximately
$14,048,000. Also during September 2005 an agreement was reached to sell two
other residential properties called Essex House and Gael Apartments, which are
located adjacent to each other in Houston, Texas; and an agreement was reached
to sell an office property called Telecom Business Center in San Diego,
California. The residential properties were sold on October 4 and 5, 2005; and
Telecom Business Center is expected to be sold in December 2005. Each of these
properties is anticipated to be sold at a gain. The total gains for the three
sales are expected to be approximately $17,100,000.

      Accordingly, as of September 30, 2005, each of the three unsold properties
at September 30, 2005 is classified as held for sale and is classified as
discontinued operations on the income statement. Income from discontinued
operations of the six properties in total was approximately $910,000 and
$884,000 for the three months ended September 30, 2005 and 2004, respectively.


                                       21
<PAGE>

      During the first and third quarter of 2005 the Company acquired two office
properties, one in Englewood, Colorado and another in Indianapolis, Indiana,
which were acquired through borrowings under the Loan Agreement. The sale of
assets completed in September and October 2005 raised proceeds to repay these
borrowings.

      The Company will continue to evaluate its portfolio, and from time-to-time
may decide to dispose of properties.

      Net Income

      Net income for the three months ended September 30, 2005 increased $19.9
million to $26.8 million compared to $6.9 million for the reasons discussed
above.

      The following table shows each segment for the nine months ended September
30, 2005 and 2004.

<TABLE>
<CAPTION>
(in thousands)
                                                                 Nine months ended September 30,
                                                             --------------------------------------
Real Estate Operations                                         2005           2004         Change
                                                               ----           ----         ------
<S>                                                          <C>            <C>           <C>
Revenues:
  Rental income                                              $ 55,290       $ 44,675      $ 10,615
  Transaction fees                                              6,119          7,758        (1,639)
  Management fees and interest income from loans                1,602            439         1,163
      Other                                                        10              5             5
                                                             --------------------------------------
                                                               63,021         52,877        10,144
                                                             --------------------------------------
Expenses:
  Real estate operating expenses                               11,842          8,458         3,384
  Real estate taxes and insurance                               7,296          5,572         1,724
  Depreciation and amortization                                11,029          8,144         2,885
  Interest                                                      2,825            517         2,308
                                                             --------------------------------------
                                                               32,992         22,691        10,301
                                                             --------------------------------------
Other items:
  Interest income                                               1,024            466           558
  Equity in earnings in non-consolidated REIT's                 1,295            464           831
                                                             --------------------------------------
                                                                2,319            930         1,389
                                                             --------------------------------------

Contribution from real estate                                  32,348         31,116         1,232
                                                             --------------------------------------

Investment Banking/Investment Services:
  Revenues:
  Syndication fees                                              6,977          8,603        (1,626)
  Transaction fees                                                769          1,451          (682)
                                                             --------------------------------------
                                                                7,746         10,054        (2,308)
                                                             --------------------------------------
Expenses:
  Depreciation and amortization                                   101            112           (11)
  Commissions                                                   3,648          4,384          (736)
                                                             --------------------------------------
                                                                3,749          4,496          (747)
                                                             --------------------------------------
Other items:
  Interest income                                                  24             32            (8)
  Taxes on income                                                (298)          (760)          462
                                                             --------------------------------------
                                                                 (274)          (728)          454
                                                             --------------------------------------

Contribution from investment banking/investment services        3,723          4,830        (1,107)
                                                             --------------------------------------

Selling, general and administrative expenses                    5,601          4,921           680
                                                             --------------------------------------

Income from discontinued operations                             2,962          2,815           147
Gain on sale of assets, net                                    13,260             --        13,260
                                                             --------------------------------------

  Net income                                                 $ 46,692       $ 33,840      $ 12,852
                                                             ======================================
</TABLE>


                                       22
<PAGE>

Comparison of the nine months ended September 30, 2005 to the nine months ended
September 30, 2004:

      Total revenues increased $7.8 million, or 12.5%, to $70.7 million for the
nine months ended September 30, 2005, as compared to $62.9 million for the nine
months ended September 30, 2004. Total expenses were $42.3 million for the nine
months ended September 30, 2005; an increase of $10.2 million, or 31.9%,
compared to the nine months ended September 30, 2004. The increase in revenues
was primarily attributable to increases in rental revenue as a result of the
mergers and acquisitions described above that was partially offset by a decrease
in revenue from our investment banking/investment services business.

      During the nine months ended September 30, 2005 our investment
banking/investment services segment had total gross proceeds of $105.3 million,
which included completion of the syndication of FSP 505 Waterford Corp., FSP
Galleria North Corp., both of which had been started in the fourth quarter of
2004, and FSP Park Ten Development Corp., which was started in August 2005 and
completed during September 2005 During the nine months ended September 30, 2004,
our investment banking/investment services segment had total gross proceeds of
$134.9 million, which included completion of the syndication of five Sponsored
REITs. Total gross proceeds decreased $29.6 million for the nine months ended
September 30, 2005 compared to nine months ended September 30, 2004. This
decrease was attributable to a slower pace of syndication investments and a more
difficult environment in which to find suitable properties to syndicate during
the nine months ended September 30, 2005 compared to the same period in 2004.
Revenues and expenses for investment banking/investment services are directly
related to the gross proceeds of these syndications.

Each segment is discussed in greater detail below.

      Real Estate Operations

      Contribution from the real estate segment was $32.3 million for the nine
months ended September 30, 2005; an increase of $1.2 million, or 4.0%, compared
to the nine months ended September 30, 2004. The increase is primarily
attributable to:

      o     An increase in real estate operating income from real estate of $5.5
            million to $36.1 million for nine months ended September 30, 2005
            compared to $30.6 million for the comparable 2004 period, which
            primarily relates to the four properties owned by the Sponsored
            REITs which we acquired by on April 30, 2005.
      o     An increase from equity in income from non-consolidated REITs of
            $0.8 million as a result of Sponsored REITs in syndication with
            greater net operating income during the nine months ended September
            30, 2005 compared to the nine months ended September 30, 2004;
      o     An increase to interest income of $0.6 million during the nine
            months ended September 30, 2005, which was primarily a result of
            higher interest rates on cash and cash equivalents compared to the
            nine months ended September 30, 2004;
      o     An increase in management fees and interest income of $1.2 million
            to $1.6 million for the nine months ended September 30, 2005
            compared to $0.4 million for the nine months ended September 30,
            2004. The increase is primarily attributable to interest income from
            Sponsored REITs, which had higher interest rates charged and larger
            loan balances outstanding for a longer period of time during the
            comparable nine month period ending September 30, 2004.

These decreases were partially offset by:

      o     A decrease in transaction fee revenues of $1.6 million to $6.1
            million for the nine months ended September 30, 2005 as compared to
            $7.7 million for the nine months ended September 30, 2004. The
            decrease was principally caused by the decrease in gross syndication
            proceeds compared to the same period in 2004;
      o     An increase to depreciation and amortization of $2.9 million to
            $11.0 million for nine months ended September 30, 2005 compared to
            $8.1 million for the comparable 2004 period, which relates to the
            four properties owned by the Sponsored REITs, that we acquired on
            April 30 2005, and two properties acquired in Colorado and Indiana;
            and
      o     An increase in interest expense of $2.3 million resulting from
            higher interest rates and larger loan balances outstanding for
            assets acquired during the nine months ended September 30, 2005
            compared to the nine months ended September 30, 2004.


                                       23
<PAGE>

      Investment Banking/Investment Services

      Contribution from the investment banking and services segment decreased
$1.1 million to $3.7 million for the nine months ended September 30, 2005,
compared to $4.8 million for the nine months ended September 30, 2004. The
decrease is primarily attributable to:

      o     A decrease in syndication and transaction fee revenues of $2.3
            million, which was primarily attributable to a lower level of gross
            syndication proceeds during the nine months ended September 30, 2005
            compared to the nine months ended September 30, 2004.

      This decrease was partially offset by:

      o     A decrease in commission expense of $0.7 million, which relates to
            the decrease in gross syndication proceeds; and
      o     A decrease in tax expense of $0.5 million to $0.3 million for the
            nine months ended September 30, 2005 as compared to $0.8 million for
            the nine months ended September 30, 2004.

      Selling, general and administrative expenses

      Selling, general and administrative costs increased $0.7 million to $5.6
million for the nine months ended September 30, 2005 compared to $4.9 million
for the nine months ended September 30, 2004, which were primarily from costs of
monitoring and managing a larger portfolio of REITs, expenses related to having
a publicly traded stock, which commenced on June 2, 2005, and increases to
franchise taxes. These increases were partially offset by decreases to
professional fees related to an investor related project completed in 2004. We
had approximately 35 employees as of September 30, 2005 at our headquarters in
Wakefield compared to 37 employees as of September 30, 2004.

      Discontinued Operations

      During June 2005 an agreement was reached to sell a property called Blue
Ravine, which is located in Folsom, California. The sale was completed on July
13, 2005 and resulted in a loss of approximately $1,127,000. The property had
been vacant since mid-2003. The offer to purchase the property was compared to
estimated future costs to convert the property from a single tenant to a
multi-tenant facility and lease the building. The Company concluded that
accepting the offer was the more prudent decision because the management time
and oversight of such a conversion outweighed the potential future benefit.

      On September 29, 2005, we recorded a non-monetary exchange gain of
$339,000 from contribution of 2.9 acres of developable land we contributed in
exchange for 8.5 preferred shares (approximately 3.05%) of a Sponsored REIT, FSP
Park Ten Development Corp. ("Park Ten Development"). The appraised value of the
land and market value of the stock acquired were used to estimate the sale
price, and the gain was recorded net of the Company's interest in Park Ten
Development.

      During September 2005 the Company sold a residential property called
Mansions in the Park, which is located in Baton Rouge, Louisiana, and sold by
transfer of its interest, an office property called Gateway Crossing, which is
located in Columbia, Maryland at gains, which aggregated approximately
$14,048,000. Also during September 2005 an agreement was reached to sell two
other residential properties called Essex House and Gael Apartments, which are
located adjacent to each other in Houston, Texas; and an agreement was reached
to sell an office property called Telecom Business Center in San Diego,
California. The residential properties were sold on October 4 and 5, 2005; and
Telecom Business Center is expected to be sold in December 2005. Each of these
properties is anticipated to be sold at a gain. The total gains for the three
sales are expected to be approximately $17,100,000.

      Accordingly, as of September 30, 2005, each of the three unsold properties
is classified as held for sale and each of the six properties sold or to be sold
is classified as discontinued operations on the income statement. Income from
discontinued operations of the six properties was approximately $2,962,000 and
$2,815,000 for the nine months ended September 30, 2005 and 2004, respectively.

      During the first and third quarter of 2005 the Company acquired two office
properties, one in Englewood, Colorado and another in Indianapolis, Indiana,
which were acquired through borrowings under the Loan Agreement. The sale of
assets completed in September and October 2005 raised proceeds to repay these
borrowings.

      The Company will continue to evaluate its portfolio, and from time-to-time
may decide to dispose of properties.


                                       24
<PAGE>

      Net Income

      Net income for the nine months ended September 30, 2005 increased $12.9
million to $46.7 million compared to $33.8 million for the reasons discussed
above.

Liquidity and Capital Resources

      Cash and cash equivalents were $66.2 million and $52.8 million at
September 30, 2005 and December 31, 2004, respectively. This increase of $13.4
million is attributable to $49.5 million provided by operating activities, $34.7
million provided by investing activities less $70.8 million used for financing
activities. Management believes that existing cash, cash anticipated to be
generated internally by operations, cash anticipated to be generated by the sale
of preferred stock in future Sponsored REITs and our line of credit will be
sufficient to meet working capital requirements and anticipated capital
expenditures and improvements for at least the next 12 months. Although there is
no guarantee that we will be able to obtain the funds necessary for our future
growth, we anticipate generating funds from continuing real estate operations
and from fees and commissions from the sale of shares in newly formed Sponsored
REITs. We believe that we have adequate funds to cover unusual expenses and
capital improvements, in addition to normal operating expenses. Our ability to
maintain or increase our level of dividends to stockholders, however, depends in
part upon the level of interest on the part of investors in purchasing shares of
Sponsored REITs and the level of rental income from our real properties.

      Operating Activities

      The cash provided by our operating activities of $49.5 million is
primarily attributable to net income of $46.7 million, plus the add-back of
$15.9 million of non-cash activity and $0.2 million of distributions in excess
of income from non-consolidated REITs, less the gain on sale of assets of $13.3
million.

      Investing Activities

      Our cash provided by investing activities of $34.8 million is attributable
to the sale of assets held for syndication of $59.5 million plus proceeds from
the sale of assets $53.0 million plus cash acquired through our merger
transaction that was completed on April 30, 2005 of $10.6 million, less uses of
$87.9 million for acquisitions and additions to real estate investments and
office equipment, and costs paid related to the merger of $0.4 million.

      Financing Activities

      Our cash used by financing activities of $70.8 million is primarily
attributable to $48.4 million of distributions to shareholders; and net
repayments on our line of credit and deferred financing costs from our amended
and restated line of credit of $22.4 million. Net repayments made during the
nine months ended September 30, 2005 were from investment banking proceeds on
assets held for syndication and proceeds from sales of properties, which were
partially offset by borrowings for interim financing of property acquisitions.

      Line of Credit

      We have a revolving line of credit agreement (the "Loan Agreement") with a
group of banks providing for borrowings of up to $150 million. During August
2005 the Loan Agreement was amended and restated, and the maturity date was
extended to August 18, 2008. Borrowings under the Loan Agreement bear interest
at either the bank's prime rate (6.75% at September 30, 2005) or a rate equal to
LIBOR plus 125 basis points (5.02% at September 30, 2005). Borrowings
outstanding under the Loan Agreement at September 30, 2005 were $37.1 million.
We are in compliance with all bank covenants required by the Loan Agreement.

      On October 6, 2005 the Company repaid the entire outstanding balance of
$37.1 million with proceeds from the sale of two properties called Essex House
and Gael Apartments.

      Contingencies

      We are subject to various legal proceedings and claims that arise in the
ordinary course of its business. Although occasional adverse decisions (or
settlements) may occur, we believe that the final disposition of such matters
will not have a material adverse effect on our financial position or results of
operations.


                                       25
<PAGE>

      Assets Held for Syndication

      As of September 30, 2005 there were no assets held for syndication. On
August 23, 2005 we completed the syndication of FSP Galleria North Corp., and on
September 28, 2005 we completed the syndication of FSP Park Ten Development
Corp. As of December 31, 2004 we had two assets held for syndication. One was
FSP 505 Waterford Corp., which was completed in January 2005, and the other was
FSP Galleria North Corp.

      Assets Held for Sale

      During September 2005 an agreement was reached to sell two residential
properties called Essex House and Gael Apartments, which are located adjacent to
each other in Houston, Texas; and an agreement was reached to sell an office
property called Telecom Business Center in San Diego, California. The
residential properties were sold on October 4 and 5, 2005; and Telecom Business
Center is expected to be sold in December 2005. Each of these properties is
anticipated to be sold at a gain, and the total gains for the three sales are
expected to be approximately $17,100,000. As of September 30, 2005 the three
properties to be sold are classified as held for sale on the balance sheet and
their cost basis.

      Related Party Transactions

      In the nine months ended September 30, 2005, we completed the syndication
of FSP 505 Waterford Corp., FSP Galleria North Corp., and FSP Park Ten
Development Corp. We did not enter into any other significant transactions with
related parties during the quarter ended September 30, 2005. For a discussion of
transactions between us and related parties during 2004, see Footnote No. 5
"Related Party Transactions" to the Consolidated Financial Statements of the
Company's Annual Report on Form 10-K for the year ended December 31, 2004.

      Other Considerations

      We generally pay the ordinary annual operating expenses of our properties
from the rental revenue generated by the properties. For the three and nine
months ended September 30, 2005 and 2004 the rental income exceeded the expenses
for each individual property, with the exception of Lyberty Way and Blue Ravine.
The single tenant lease at the Lyberty Way property located in Westford,
Massachusetts, expired October 31, 2004. We have not re-let this property and
expect that it will not produce revenue to cover its expenses in the fourth
quarter. The property called Blue Ravine, which was sold on July 13, 2005, had
been vacant since June 2003 and had operating expenses of approximately $12,000
and $170,000 for the three and nine months ended September 30, 2005.


CERTAIN FACTORS THAT MAY AFFECT FUTURE RESULTS

      The following important factors, among others, could cause actual results
to differ materially from those indicated by forward-looking statements made in
this Quarterly Report on Form 10-Q and presented elsewhere by management from
time to time.

If we are not able to collect sufficient rents from each of our owned real
properties, we may suffer significant operating losses or a reduction in cash
available for future dividends.

      A substantial portion of our revenues are generated by the rental income
of our real properties. If our properties do not provide us with a steady rental
income, our revenues will decrease and may cause us to incur operating losses in
the future.

We face risks in continuing to attract investors for Sponsored REITs.

      Our investment banking/investment services business continues to depend
upon its ability to attract purchasers of equity interests in Sponsored REITs.
Our success in this area will depend on the propensity and ability of investors
who have previously invested in Sponsored REITs to continue to invest in future
Sponsored REITs and on our ability to expand the investor pool for the Sponsored
REITs by identifying new potential investors. Moreover, our investment
banking/investment services business may be affected to the extent existing
Sponsored REITs incur losses or have operating results that fail to meet
investors' expectations.

If we are unable to fully syndicate a Sponsored REIT, we may be required to keep
a balance outstanding on our line of credit or use our cash balance to repay our
line of credit, which may reduce cash available for distribution to our
stockholders.

      We typically draw on our line of credit to make an interim mortgage loan
to a Sponsored REIT, so that it can acquire real property prior to the
consummation of the offering of its equity interests; this interim loan is
secured by a first mortgage of the real property acquired by the Sponsored REIT.
Once the offering has been completed, the Sponsored REIT repays the loan out of
the offering proceeds. If we are unable to fully syndicate a Sponsored REIT, the


                                       26
<PAGE>

Sponsored REIT could be unable to fully repay the loan, and we would have to
satisfy our obligation under our line of credit through other means. If we are
required to use cash for this purpose, we would have less cash available for
distribution to our stockholders.

We may not be able to find properties that meet our criteria for purchase.

      Growth in our investment banking/investment services business and our
portfolio of real estate is dependent on the ability of our acquisition
executives to find properties for sale which meet our investment criteria. To
the extent they fail to find such properties, we will be unable to syndicate
offerings of Sponsored REITs to investors, and this segment of our business
could have lower revenue, which would reduce the cash available for distribution
to our stockholders, and we would be unable to increase the size of our
portfolio of real estate.

We are dependent on key personnel.

      We depend on the efforts of George Carter, our Chief Executive Officer,
and our other executive officers. If they were to resign, our operations could
be adversely affected. We do not have employment agreements with Mr. Carter or
any other of our executive officers.

Our level of dividends may fluctuate.

      Because our investment banking/investment services business is
transactional in nature and real estate occupancy levels and rental rates can
fluctuate, there is no predictable recurring level of revenue from such
activities. As a result of this, the amount of cash available for distribution
may fluctuate, which may result in us not being able to maintain or grow
dividend levels in the future.

The real properties held by us may significantly decrease in value.

      As of September 30, 2005, we owned 31 properties, including three that
were held for sale. Some or all of these properties may decline in value. To the
extent our real properties decline in value, our stockholders could lose some or
all the value of their investments. The value of our common stock may still be
adversely affected if the real properties held by us decline in value since
these real properties represent the majority of the tangible assets held by us.
Moreover, if either we are forced to sell or lease the real property held by us
below its initial purchase price or its carrying costs or if we are forced to
lease real property at below market rates because of the condition of the
property, our results of operations would be adversely affected and such
negative results of operations may result in lower dividends being paid to
holders of our common stock.

New acquisitions may fail to perform as expected.

      We may acquire new properties, whether by direct FSP Corp. cash purchase,
by acquisition of Sponsored REITs or other properties by cash or through the
issuance of shares of our stock or by investment in a Sponsored REIT. We
acquired four Sponsored REITs and the properties they own on April 30, 2005, and
acquired two properties in Colorado and Indiana. Newly acquired properties may
fail to perform as expected, in which case, our results of operations could be
adversely affected.

We face risks in developing, owning and operating real property.

      An investment in us is subject to the risks incident to the development,
ownership and operation of real estate-related assets. These risks include the
fact that real estate investments are generally illiquid, which may impact our
ability to vary our portfolio in response to changes in economic and other
conditions, as well as the risks normally associated with:

      o     changes in general and local economic conditions;
      o     the supply or demand for particular types of properties in
            particular markets;
      o     changes in market rental rates;
      o     the impact of environmental protection laws; and
      o     changes in tax, real estate and zoning laws.

      Certain significant costs, such as real estate taxes, utilities, insurance
and maintenance costs, generally are not reduced even when a property's rental
income is reduced. In addition, environmental and tax laws, interest rate
levels, the availability of financing and other factors may affect real estate
values and property income. Furthermore, the supply of commercial and
multi-family residential space fluctuates with market conditions.

We face risks from tenant defaults or bankruptcies.

      If any of our tenants defaults on its lease, we may experience delays in
enforcing our rights as a landlord and may incur substantial costs in protecting
our investment. In addition, at any time, a tenant of one of our properties may
seek the protection of bankruptcy laws, which could result in the rejection and
termination of such tenant's lease and thereby cause a reduction in cash
available for distribution to our stockholders.


                                       27
<PAGE>

We may encounter significant delays in reletting vacant space, resulting in
losses of income.

      When leases expire, we will incur expenses and may not be able to re-lease
the space on the same terms. Certain leases provide tenants the right to
terminate early if they pay a fee. If we are unable to re-lease space promptly,
if the terms are significantly less favorable than anticipated or if the costs
are higher, we may have to reduce distributions to our stockholders. For
example, our standard lease term is five years, so approximately 20%, of our
rental revenue from commercial properties could be expected to expire each year.
Leases for residential properties generally expire in less than one year.

We face risks from geographic concentration.

      The properties in our portfolio as of September 30, 2005, by aggregate
square footage, are distributed geographically as follows: Southwest - 25%,
Northeast - 23%, Midwest - 22%, West - 19% and Southeast 11%. However, within
certain of those regions, we hold a larger concentration of our properties in
Virginia - 12%, Dallas, Texas - 14% and Houston, Texas - 9%. We are likely to
face risks to the extent that any of these areas in which we hold a larger
concentration of our properties suffer deteriorating economic conditions.

We compete with national, regional and local real estate operators and
developers, which could adversely affect our cash flow.

      Competition exists in every market in which our properties are currently
located and in every market in which our properties will be located. We compete
with, among others, national, regional and numerous local real estate operators
and developers. Such competition may adversely affect the percentage of leased
space and the rental revenues of our properties, which could adversely affect
our cash flow from operations and our ability to make expected distributions to
our stockholders. Some of our competitors may have more resources than we do or
other competitive advantages. Competition may be accelerated by any increase in
availability of funds for investment in real estate. For example, decreases in
interest rates tend to increase the availability of funds and therefore can
increase competition. To the extent that our properties continue to operate
profitably, this will likely stimulate new development of competing properties.
The extent to which we are affected by competition will depend in significant
part on local market conditions.

There is limited potential for an increase in leased space gains in our
properties.

      We anticipate that future increases in revenue from our properties will be
primarily the result of scheduled rental rate increases or rental rate increases
as leases expire. Properties with higher rates of vacancy are generally located
in soft economic markets so that it may be difficult to realize increases in
revenue when vacant space is re-leased.

We are subject to possible liability relating to environmental matters, and we
cannot assure you that we have identified all possible liabilities.

      Under various federal, state and local laws, ordinances and regulations,
an owner or operator of real property may become liable for the costs of removal
or remediation of certain hazardous substances released on or in its property.
Such laws may impose liability without regard to whether the owner or operator
knew of, or caused, the release of such hazardous substances. The presence of
hazardous substances on a property may adversely affect the owner's ability to
sell such property or to borrow using such property as collateral, and it may
cause the owner of the property to incur substantial remediation costs. In
addition to claims for cleanup costs, the presence of hazardous substances on a
property could result in the owner incurring substantial liabilities as a result
of a claim by a private party for personal injury or a claim by an adjacent
property owner for property damage.

      In addition, we cannot assure you that:

      o     future laws, ordinances or regulations will not impose any material
            environmental liability;
      o     the current environmental conditions of our properties will not be
            affected by the condition of properties in the vicinity of such
            properties (such as the presence of leaking underground storage
            tanks) or by third parties unrelated to us;
      o     tenants will not violate their leases by introducing hazardous or
            toxic substances into our properties that could expose us to
            liability under federal or state environmental laws; or
      o     environmental conditions, such as the growth of bacteria and toxic
            mold in heating and ventilation systems or on walls, will not occur
            at our properties and pose a threat to human health.

We are subject to compliance with the Americans With Disabilities Act and fire
and safety regulations which could require us to make significant capital
expenditures.

      All of our properties are required to comply with the Americans With
Disabilities Act (ADA), and the regulations, rules and orders that may be issued
thereunder. The ADA has separate compliance requirements for "public
accommodations" and "commercial facilities," but generally requires that
buildings be made accessible to persons with disabilities. Compliance with ADA
requirements might require, among other things, removal of access barriers and
noncompliance could result in the imposition of fines by the U.S. government, or
an award of damages to private litigants.


                                       28
<PAGE>

      In addition, we are required to operate our properties in compliance with
fire and safety regulations, building codes and other land use regulations, as
they may be adopted by governmental agencies and bodies and become applicable to
our properties. Compliance with such requirements may require us to make
substantial capital expenditures, which expenditures would reduce cash otherwise
available for distribution to its stockholders.

We may lose capital investment or anticipated profits if an uninsured event
occurs.

      We carry or our tenants carry comprehensive liability, fire and extended
coverage with respect to each of our properties, with policy specification and
insured limits customarily carried for similar properties. There are, however,
certain types of losses, such as from wars, pollution or earthquakes, that may
be either uninsurable or not economically insurable (although most properties
located in California have earthquake insurance). Should an uninsured material
loss occur, we could lose both capital invested in the property and anticipated
profits.

Contingent or unknown liabilities acquired in mergers or similar transactions
could require us to make substantial payments.

      The properties which we acquired in mergers were acquired subject to
liabilities and without any recourse with respect to liabilities, whether known
or unknown. As a result, if liabilities were asserted against us based upon any
of these properties, we might have to pay substantial sums to settle them, which
could adversely affect our results of operations and financial condition and our
cash flow and ability to make distributions to our stockholders. Unknown
liabilities with respect to properties acquired might include:

      o     liabilities for clean-up or remediation of environmental conditions;
      o     claims of tenants, vendors or other persons dealing with the former
            owners of the properties; and
      o     liabilities incurred in the ordinary course of business.

We would incur adverse tax consequences if we failed to qualify as a REIT.

      The provisions of the tax code governing the taxation of real estate
investment trusts are very technical and complex, and although we expect that we
will be organized and will operate in a manner that will enable us to meet such
requirements, no assurance can be given that we will always succeed in doing so.
In addition, as a result of our acquisition of the target REITs pursuant to the
mergers consummated on April 30, 2005, we might no longer qualify as a real
estate investment trust. We could lose our ability to so qualify for a variety
of reasons relating to the nature of the assets acquired from the target REITs,
the identity of the shareholders of the target REITs who become our shareholders
or the failure of one or more of the target REITs to have previously qualified
as a real estate investment trust. Moreover, you should note that if one or more
of the REITs that we acquired in June 2003 or April 2005 did not qualify as a
real estate investment trust immediately prior to the consummation of its
acquisition, we could be disqualified as a REIT as a result of such acquisition.

      If in any taxable year we do not qualify as a real estate investment
trust, we would be taxed as a corporation and distributions to our stockholders
would not be deductible by us in computing our taxable income. In addition, if
we were to fail to qualify as a real estate investment trust, we could be
disqualified from treatment as a real estate investment trust in the year in
which such failure occurred and for the next four taxable years and,
consequently, we would be taxed as a regular corporation during such years.
Failure to qualify for even one taxable year could result in a significant
reduction of our cash available for distribution to our stockholders or could
require us to incur indebtedness or liquidate investments in order to generate
sufficient funds to pay the resulting federal income tax liabilities.

Provisions in our organizational documents may prevent changes in control.

      Our Articles of Incorporation and Bylaws contain provisions, described
below, which may have the effect of discouraging a third party from making an
acquisition proposal for us and may thereby inhibit a change of control under
circumstances that could otherwise give the holders of our common stock the
opportunity to realize a premium over the then-prevailing market prices.

      Ownership Limits. In order for us to maintain our qualification as a real
estate investment trust, the holders of our common stock may be limited to
owning, either directly or under applicable attribution rules of the Internal
Revenue Code, no more than 9.8% of the lesser of the value or the number of
equity shares of us, and no holder of common stock may acquire or transfer
shares that would result in our shares of common stock being beneficially owned
by fewer than 100 persons. Such ownership limit may have the effect of
preventing an acquisition of control of us without the approval of our board of
directors. Our Articles of Incorporation give our board of directors the right
to refuse to give effect to the acquisition or transfer of shares by a
stockholder in violation of these provisions.


                                       29
<PAGE>

      Staggered Board. Our board of directors is divided into three classes. The
terms of these classes will expire in 2006, 2007 and 2008, respectively.
Directors of each class are elected for a three-year term upon the expiration of
the initial term of each class. The staggered terms for directors may affect our
stockholders' ability to effect a change in control even if a change in control
were in the stockholders' best interests.

      Preferred Stock. Our Articles of Incorporation authorize our board of
directors to issue up to 20,000,000 shares of preferred stock, par value $.0001
per share, and to establish the preferences and rights of any such shares
issued. The issuance of preferred stock could have the effect of delaying or
preventing a change in control even if a change in control were in our
stockholders' best interest.

      Increase of Authorized Stock. Our board of directors, without any vote or
consent of the stockholders, may increase the number of authorized shares of any
class or series of stock or the aggregate number of authorized shares we have
authority to issue. The ability to increase the number of authorized shares and
issue such shares could have the effect of delaying or preventing a change in
control even if a change in control were in our stockholders' best interest.

      Amendment of Bylaws. Our board of directors has the sole power to amend
our Bylaws. This power could have the effect of delaying or preventing a change
in control even if a change in control were in our stockholders' best interests.

      Stockholder Meetings. Our Bylaws require advance notice for stockholder
proposals to be considered at annual meetings of stockholders and for
stockholder nominations for election of directors at special meetings of
stockholders. Our Bylaws also provide that stockholders entitled to cast more
than 50% of all the votes entitled to be cast at a meeting must join in a
request by stockholders to call a special meeting of stockholders. These
provisions could have the effect of delaying or preventing a change in control
even if a change in control were in the best interests of our stockholders.

      Supermajority Votes Required. Our Articles of Incorporation require the
affirmative vote of the holders of no less than 80% of the shares of capital
stock outstanding and entitled to vote in order (i) to amend the provisions of
our Articles of Incorporation relating to the classification of directors,
removal of directors, limitation of liability of officers and directors or
indemnification of officers and directors or (ii) to amend our Articles of
Incorporation to impose cumulative voting in the election of directors. These
provisions could have the effect of delaying or preventing a change in control
even if a change in control were in our stockholders' best interest.

The price of our common stock may vary.

      Our common stock has recently been listed for trading on the AMEX. We can
provide no assurances as to the development of an ongoing meaningful trading
market in our common stock. If a meaningful trading market does develop, the
market prices for our common stock may fluctuate with changes in market and
economic conditions, including the market perception of REITs in general, and
changes in the financial condition of our securities. Such fluctuations may
depress the market price of our common stock independent of the financial
performance of FSP Corp. The market conditions for REIT stocks generally could
affect the market price of our common stock.


                                       30
<PAGE>

Item 3. Quantitative and Qualitative Disclosures about Market Risk

We were not a party to any derivative financial instruments at or during the
nine months ended September 30, 2005.

We borrow from time-to-time on our line of credit. These borrowings bear
interest at the bank's prime rate (6.75% at September 30, 2005) or at the rate
of LIBOR plus 125 basis points (5.02% at September 30, 2005), as elected by us
when requesting funds as defined by the Loan Agreement. As of September 30,
2005, $37,135,000 was outstanding under the line of credit consisting of one
borrowing of $37,135,000 at the LIBOR plus 125 basis point rate, or 5.02%. We
have used funds drawn on our line of credit for the purpose of making interim
acquisition financing or mortgage loans to Sponsored REITs. The mortgage loans
bear interest at the same variable rate payable by us under our line of credit.
In instances where there is a mortgage loan, we believe that we have mitigated
our interest rate risk with respect to those borrowings.


                                       31
<PAGE>

Item 4. Controls and Procedures

Our management, with the participation of FSP Corp.'s President and Chief
Executive Officer and FSP Corp.'s Chief Financial Officer, evaluated the
effectiveness of our disclosure controls and procedures (as defined in Rules
13a-15(e) and 15d-15(d) under the Exchange Act) as of September 30, 2005.
Management recognizes that any controls and procedures, no matter how well
designed and operated, can provide only reasonable assurance of achieving their
objectives and management necessarily applies its judgment in evaluating the
cost-benefit relationship of possible controls and procedures. Based on this
evaluation, FSP Corp.'s President and Chief Executive Officer and FSP Corp.'s
Chief Financial Officer concluded that, as of September 30, 2005, our disclosure
controls and procedures were (1) designed to ensure that material information
relating to us, including our consolidated subsidiaries, is made known to FSP
Corp.'s President and Chief Executive Officer and FSP Corp.'s Chief Financial
Officer by others within these entities as appropriate to allow timely decisions
regarding required disclosure, particularly during the period in which this
report was being prepared and (2) effective, in that they provide reasonable
assurance that information required to be disclosed by us in the reports that we
file or submit under the Exchange Act is recorded, processed, summarized and
reported within the time periods specified in the SEC's rules and forms.

No change to our internal control over financial reporting (as defined in Rules
13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the quarter
ended September 30, 2005 that has materially affected, or is reasonably likely
to materially affect, our internal control over financial reporting.


                                       32
<PAGE>

                           PART II - OTHER INFORMATION

Item 1. Legal Proceedings:

      Not applicable.

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

      (c) The following table provides information about purchases by Franklin
Street Properties Corp. during the quarter ended September 30, 2005 of equity
securities that are registered by the Company pursuant to Section 12 of the
Exchange Act:


                      ISSUER PURCHASES OF EQUITY SECURITIES

<TABLE>
<CAPTION>
------------------------- --------------------- --------------------- --------------------- ---------------------------
                                  (a)                   (b)                   (c)                      (d)

                                                                                                Maximum Number (or
                                                                        Total Number of         Approximate Dollar
                                                                       Shares (or Units)       Value) of Shares (or
                                                                       Purchased as Part      Units) that May Yet Be
                            Total Number of        Average Price          of Publicly          Purchased Under the
                           Shares (or Units)       Paid per Share       Announced Plans         Plans or Programs
Period                       Purchased (1)            (or Unit)         or Programs (1)              (1) (2)
------------------------- --------------------- --------------------- --------------------- ---------------------------

<S>                                <C>                  <C>                    <C>                      <C>
07/01/05-07/31/05                  0                    N/A                    0                        0
------------------------- --------------------- --------------------- --------------------- ---------------------------

08/01/05-08/31/05                  0                    N/A                    0                        0
------------------------- --------------------- --------------------- --------------------- ---------------------------

09/01/05-09/30/05                  0                    N/A                    0                        0
------------------------- --------------------- --------------------- --------------------- ---------------------------

Total:                             0                    N/A                    0                        0
------------------------- --------------------- --------------------- --------------------- ---------------------------
</TABLE>

      (1) FSP Corp.'s Articles of Incorporation provide that FSP Corp. will use
its best efforts to redeem shares of its common stock from stockholders who
request such redemption. Any FSP Corp. stockholder wishing to have shares
redeemed must make such a request no later than July 1 of any year for a
redemption that would be effective the following January 1.

      This obligation is subject to significant conditions, including that (i)
FSP Corp. cannot be insolvent or rendered insolvent by the redemption, (ii) the
redemption cannot impair the capital or operations of FSP Corp., (iii) the
redemption cannot contravene any provision of federal or state securities law,
(iv) the redemption cannot result in FSP Corp.'s failing to qualify as a REIT,
and (v) the management of FSP Corp. must determine that the redemption is in the
best interest of FSP Corp. Redemptions pursuant to these provisions result in
redeeming stockholders receiving cash in an amount of 90% of the fair market
value of the stock redeemed, as determined by FSP Corp.'s Board of Directors.

      As our common stock is currently listed for trading on AMEX, we are no
longer obligated to, and do not intend to, effect any redemption.

      (2) On October 28, 2005 FSP Corp. announced that the Board of Directors of
FSP Corp. had authorized the repurchase of up to $35 million of the Company's
common stock from time to time in the open market or in privately negotiated
transactions.

Item 3. Defaults Upon Senior Securities:

      Not applicable.

Item 4. Submission of Matters to a Vote of Security Holders:

      None

Item 5. Other Information:

      For purposes of Regulation FD the Company has attached a table regarding
the investors in Sponsored REITs attached as Exhibit 99.1 hereto.


                                       33
<PAGE>

                     PART II - OTHER INFORMATION (Continued)

Item 6. Exhibits:

      3.1 Amended and Restated Bylaws of the Registrant (incorporated by
      reference to the Registrant's Current Report on Form 8-K dated
      October 28, 2005).

      10.1 Second Amended and Restated Loan Agreement, dated as of August 16,
      2005, by and among the Registrant, certain of its wholly-owned
      subsidiaries, Citizens Bank of Massachusetts, Bank of America, N.A., Chevy
      Chase Bank, F.S.B. and other lenders which may become party thereto from
      time to time (incorporated by reference to the Registrant's Current Report
      on Form 8-K dated August 18, 2005).

      31.1 Certification of the President and Chief Executive Officer of the
      Registrant pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

      31.2 Certification of the Chief Financial Officer of the Registrant
      pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

      32.1 Certification of the President and Chief Executive Officer of the
      Registrant pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
      Section 906 of the Sarbanes-Oxley Act of 2002.

      32.2 Certification of the Chief Financial Officer of the Registrant
      pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
      the Sarbanes-Oxley Act of 2002.

      99.1 Table regarding investors in Sponsored REITs.


                                       34
<PAGE>

                                   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.

                                         Franklin Street Properties Corp.


<TABLE>
<CAPTION>
         Date                     Signature                    Title
         ----                     ---------                    -----


<C>                         <C>                      <C>
Date: November 2, 2005      /s/ George J. Carter     Chief Executive Officer and Director
                            ----------------------   (Principal Executive Officer)
                            George J. Carter


Date: November 2, 2005      /s/ John G. Demeritt     Senior Vice President and Chief Financial
                            ----------------------   Officer (Principal Financial Officer)
                            John G. Demeritt
</TABLE>


                                      35