EXHIBIT 10.12
                       FIFTH AMENDMENT TO CREDIT AGREEMENT
                       -----------------------------------

     This  Fifth  Amendment  to  Credit  Agreement  is made as of the 1st day of
October,  1998 by and  among  PRIME  GROUP  REALTY,  L.P.,  a  Delaware  limited
partnership  (the  "Borrower"),  PRIME GROUP REALTY TRUST, a Maryland trust (the
"Company") and BANKBOSTON,  N.A., a national banking association ("BankBoston"),
PRUDENTIAL SECURITIES CREDIT CORPORATION, a Delaware corporation ("Prudential"),
the other lending institutions which are from time to time listed on Schedule 1,
(collectively,  with BankBoston and  Prudential,  the "Lenders") and BANKBOSTON,
N.A., as agent for itself and such other lending institutions (the "Agent").

     WHEREAS,  the parties hereto are parties to that certain  Credit  Agreement
dated as of November 17, 1997 as amended by First Amendment to Credit  Agreement
dated as of December 15, 1997 and by Second  Amendment to Credit Agreement dated
as of March 16,  1998,  as amended  and  restated by Third  Amendment  to Credit
Agreement  dated as of March 30,  1998 and as  amended  by Fourth  Amendment  to
Credit Agreement dated as of April 24, 1998 (the "Existing Agreement"); and

     WHEREAS,  the Borrower has requested that the Agent release the West Wacker
Drive  Property  from the lien of the Security  Documents but such release would
not be  permitted by Section 5.5 because  certain  Defaults or Events of Default
would  arise  therefrom  or from  the new  Indebtedness  to be  incurred  by the
Borrower secured by the West Wacker Drive Property; and

     WHEREAS,  the parties have agreed to amend the Existing  Agreement so as to
permit the  requested  release of the West Wacker  Drive  Property and to effect
certain other changes in the Existing Agreement.

     NOW, THEREFORE, the parties hereby agree that effective upon the
Effective  Date  hereof  (as  determined  pursuant  to  Paragraph  18 below) the
Existing Agreement is amended as follows:

     1. DECREASE IN TOTAL  COMMITMENT.  The Total Commitment is hereby decreased
to  $80,000,000  and each Lender hereby  decreases its  Commitment to the amount
shown on the revised Schedule 1.2 attached hereto.  As of the Effective Date the
Commitment Percentages of the Lenders shall be adjusted as shown on said revised
Schedule  1.2. The parties  shown on such revised  Schedule 1.2 as having a zero
Commitment  and 0% Commitment  Percentage  shall no longer be Lenders  hereunder
after the Effective Date.

     2. DEFINITIONS: Section 1.1 of the Existing Agreement is amended to provide
that the following  terms shall have the  following  meanings and, to the extent
that any of the following terms are already  defined in the Existing  Agreement,
such  definitions  shall be deemed to be amended and  restated by the  following
definitions:

     Applicable  Margin.  As of any date of  determination,  two and one quarter
percent (2.25%).

     Collateral Account. The cash collateral account established pursuant to the
Collateral  Account  Agreement  in which the Agent  shall hold  funds  deposited
pursuant to Section 5.6 or Section 2.9(f).

     Collateral  Account  Agreement.  The  Collateral  Account  Agreement  dated
October 1, 1998 from the Borrower as pledgor to the Agent as secured party.

     Collateral Account Balance. As of any date of determination,  the aggregate
amount of all cash and other investments held in the Collateral Account.

     EBITDA. The Borrower's  earnings before interest,  taxes,  depreciation and
amortization, as determined on a consolidated basis in accordance with Generally
Accepted  Accounting  Principles,  except that rental income shall be determined
based on contractual  lease terms (to the extent that the  applicable  tenant is
actually paying rent in accordance with such terms).

         Permitted  Company   Subsidiaries.   Corporations,   limited  liability
companies or other entities,  each of which is a wholly owned  Subsidiary of the
Company and whose only asset is a  partnership  interest in a  partnership  or a
membership  interest  in a  limited  liability  company  provided  that (i) such
Company Subsidiary's ownership interest in such partnership or limited liability
company does not exceed one percent (1%); (ii) the remaining 99% or more of such
partnership  or limited  liability  company is owned by the Borrower;  and (iii)
such partnership or limited  liability company owns a Property which is financed
                                      -1-
<PAGE>
or to be financed with or through a securitized or securitizable  loan structure
and the  applicable  lender  requires  that the borrower  entity be  "bankruptcy
remote" by having a certain  percentage  of the  borrower  entity  owned by such
corporation  and,  if such  required  percentage  is less than 1%,  the  Company
Subsidiary's  ownership  interest  shall not exceed the level  required  by such
lender.

     Pro Forma  Principal  Amount.  (a) With respect to Compliance  Certificates
delivered pursuant to Section 7.4(e), the maximum  Outstanding  Principal Amount
at any time during the applicable  fiscal  quarter minus the Collateral  Account
Balance  on the  last  day of such  quarter;  (b)  with  respect  to  Compliance
Certificates  delivered  pursuant to Section 2.5,  2.9(b) or Section  11.1,  the
Outstanding  Principal  Amount after giving effect to the requested  Loan or the
issuance of the requested Letter of Credit minus the Collateral  Account Balance
on the Borrowing Date or the date of issuance of such Letter of Credit; (c) with
respect to Compliance  Certificates  delivered  pursuant to Section 5.5, Section
5.6 or Section  8.4(b),  the Outstanding  Principal  Amount minus the Collateral
Account  Balance after giving effect to any proposed sale or transfer  including
any payments on the Loans or cancellation of Letters of Credit or any changes in
the Collateral Account Balance to be made in connection therewith.

     Security  Documents.  The Security  Deeds,  the  Assignments  of Leases and
Rents, the Pledge  Agreements and the UCC-1 financing  statements,  the Assigned
Note Assignments and all documents  securing the Assigned Notes assigned thereby
and the Collateral Account Agreement.

     Total Adjusted Assets. The sum of (i) the assets classified as cash or cash
equivalents on the consolidated balance sheet of Borrower prepared in accordance
with Generally  Accepted  Accounting  Principles as of the date of determination
(including  any  restricted  cash other  than  tenant  deposits),  plus (ii) the
product  of (a)  EBITDA  for the most  recent  two  fiscal  quarters  for  which
financial  statements have been provided  pursuant to Section 7.4(b),  times (b)
two, divided by (c) 0.0975. EBITDA used to compute Total Adjusted Assets will be
computed on a pro forma basis as though the assets reflected on the consolidated
balance  sheet of  Borrower  prepared  in  accordance  with  Generally  Accepted
Accounting  Principles as of the date of determination  had been owned since the
first day of the  applicable  period of two  fiscal  quarters  and as though all
assets disposed of prior to the date of determination had been disposed of prior
to the first day of the applicable period of two fiscal quarters.

     Total Liabilities. The sum of the following (without duplication):  (i) all
liabilities  of  the  Borrower  and  the  Related  Companies   consolidated  and
determined in accordance with Generally Accepted Accounting Principles excluding
the dividends  payable and accounts  payable and accrued  expenses line items as
shown on the balance  sheet  included in the  Company's  Form 10-K and Form 10-Q
statements  filed with the SEC (but not excluding the accrued  interest  payable
and accrued real estate taxes line items as shown on such balance  sheet),  (ii)
all  Indebtedness  of the Borrower and the Related  Companies  whether or not so
classified,  including,  without  limitation,  all outstanding  Loans under this
Agreement,  and (iii) the balance  available for drawing under letters of credit
issued for the account of the  Borrower or any of the  Related  Companies.  When
compliance with Section 9.3 is being computed as of a date other than the end of
a fiscal quarter,  Total  Liabilities will be adjusted to reflect all changes in
the items described in clauses (ii) and (iii) of this  definition  since the end
of the last fiscal  quarter for which  financial  statements  have been provided
pursuant  to  Section  7.4(b)  but it  shall be  presumed  that  other  types of
liabilities have remained the same since the end of such quarter.

     3.  AMENDMENTS TO SECTION 2.9. The first  sentence of Section 2.9 is hereby
amended and restated to read as follows:  "A portion of the  Commitments  may be
used by the  Borrower for the issuance of Letters of Credit by the Agent for the
account of the Borrower  subject to the terms and  conditions  set forth herein,
provided  that the  aggregate  face  amount of all  Letters of Credit  shall not
exceed $50,000,000."

     4.  AMENDMENT TO SECTION 4.4.  Section4.4  is hereby  amended by adding the
following  sentence to the end thereof:  "The  Borrower  shall make each payment
hereunder not later than 11:00 A.M.  (Eastern  Time) on the day when due, to the
Agent in immediately  available funds without set-off or  counterclaim,  and any
payments  received by the Agent after 11:00 A.M.  (Eastern Time) shall be deemed
to be received on the next Business Day."

     5. Amendments to Section 5.1. Section 5.1 is hereby amended and restated to
read as follows:

     Section 5.1. Collateral Security. The Obligations shall be secured by (i) a
perfected  first  priority  lien and  security  interest to be held by the Agent

                                      -2-
<PAGE>
(subject only to Permitted Liens) in the Mortgaged  Properties,  pursuant to the
terms of the  Security  Documents,  (ii) a  perfected  first  priority  lien and
security  interest  to be held by the Agent in the Leases and rents  pursuant to
the  Assignments  of Leases  and  Rents,  (iii) a first  priority  pledge of any
pledged bonds  purchased  with the proceeds of Drawings  under any IRB Letter of
Credit  pursuant to the Pledge  Agreements,  (iv) a first priority pledge of any
monies or  investments  in the  Collateral  Account  pursuant to the  Collateral
Account Agreement and (v) the Guaranties.

     6. NEW SECTION  5.6. A new  Section 5.6 to read as follows is hereby  added
immediately following Section 5.5:

     Section  5.6.  Collateral  Account.  If  Borrower  desires the release of a
Mortgaged  Property from the lien of the Security  Documents  pursuant to Sectio
5.5 but the same  would  not be  permitted  because  an Event of  Default  under
Section 9.1 or Section 9.2 would result from such a release,  the Borrower shall
deposit in the Collateral Account established pursuant to the Collateral Account
Agreement  such amount as may be required to  increase  the  Collateral  Account
Balance to a level such that the requested  release will not result in a default
under Section 9.1 or Section 9.2. In the event of any subsequent increase in the
Collateral  Value of the  Mortgaged  Properties  or decrease in the  Outstanding
Principal Amount, the Borrower may request that the Agent release funds from the
Collateral  Account and the Agent shall grant such  requested  release  provided
there is then no continuing Default or Event of Default under this Agreement and
the  requested  release will not result in any Default or Event of Default under
this  Agreement  and the Borrower  delivers to the Agent a pro-forma  Compliance
Certificate  reasonably   satisfactory  to  the  Agent  demonstrating  that  the
requested  release  will not result in a violation  of any of the  covenants  in
Section 9.1 or Section 9.2.

     7. NEW SECTION  7.22. A new Section 7.22 to read as follows is hereby added
immediately following Section 7.21:

     Section  7.22.  Distributions  from  Permitted  Company  Subsidiaries.  The
Company will cause each Permitted Company  Subsidiary to promptly  distribute to
the  Company an amount  equal to any  distributions  received  by the  Permitted
Company  Subsidiary from the partnership or limited  liability  company in which
the  Permitted  Company  Subsidiary  is a partner  or member.  All such  amounts
distributed  to the  Company  by  any  Permitted  Company  Subsidiary  shall  be
immediately  contributed by the Company to the Borrower as an additional capital
contribution with respect to the Company's general  partnership  interest in the
Borrower.

     8. AMENDMENTS TO SECTION 6.19.  Section 6.19 is hereby amended and restated
to read as follows:

     Section 6.19. Subsidiaries and Affiliates. The Borrower has no Subsidiaries
except for the Related  Companies  listed on  Schedule  1.3 and does not have an
ownership interest in any entity whose financial statements are not consolidated
with the Borrower's  except for the Permitted  Joint Ventures listed on Schedule
1.3.  The Company is not a partner in any  partnership  other than  Borrower and
certain  of the  Related  Companies  listed on  Schedule  1.3 which are  limited
partnerships  in which  the  Company  has a one  tenth  percent  (0.1%)  limited
partnership interest,  has no Investments in any Person other than the Borrower,
Permitted Company Subsidiaries and such limited partnerships and is not a member
of any limited liability company. The Company owns no material assets other than
its  partnership  interest  in  Borrower,  its  stock in the  Permitted  Company
Subsidiaries  and the limited  partnership  interests  described in this Section
6.19.

     9.  AMENDMENTS  TO SECTION  8.1(f).  Section  8.1(f) is hereby  amended and
restated to read as follows:

     (f) Indebtedness of Borrower,  the Company or the Related  Companies to the
extent  the same does not create a  violation  of Section  9.3,  Section  9.5 or
Section 9.6 provided that the maximum principal amount of Recourse  Indebtedness
permitted under this paragraph shall not exceed  $60,000,000 in the aggregate at
any time  outstanding.  Schedule  8.1(f) attached hereto sets forth the existing
Indebtedness  (and  proposed  indebtedness  for which  Borrower  has  accepted a
commitment letter) included within such limit on Recourse Indebtedness.

     10.  AMENDMENTS TO SECTION  8.9(a).  Section  8.9(a) is hereby  amended and
restated to read as follows:

     (a) own any assets, or have any Investments,  other than owning its general
partnership interest in the Borrower,  its stock or other equity interest in the
Permitted Company  Subsidiaries and its limited partnership  interests described
in Section 6.19.
                                      -3-
<PAGE>
     11.  AMENDMENTS TO SECTION 9. Section 9.1,  Section 9.2 and Section 9.3 are
hereby amended and restated to read as follows:

     Section 9.1. Collateral Value. The Borrower will not at any time permit the
Outstanding  Principal  Amount (minus the Collateral  Account Balance) to exceed
the sum of (i) sixty percent (60%) of the total of the Collateral  Values of the
Mortgaged  Properties  other than the Assigned  Mortgaged  Properties  plus (ii)
fifty  percent  (50%) of the  total of the  Collateral  Values  of the  Assigned
Mortgaged Properties.

     Section 9.2.  Minimum Debt Service  Coverage.  The Borrower will not at any
time permit the  Outstanding  Principal  Amount  (minus the  Collateral  Account
Balance) to exceed an amount such that:  (a) the  aggregate of the Net Operating
Income  for all of the  Mortgaged  Properties,  divided  by (b) Pro  Forma  Debt
Service  Charges  for the  Mortgaged  Properties  would be less than 1.5 for any
fiscal quarter of Borrower. For purposes of the foregoing, any Real Estate Asset
that became a Mortgaged  Property during the applicable  fiscal quarter shall be
treated as though it were a Mortgaged  Property  for the entire  quarter and any
Real Estate Asset which is released by Agent during such fiscal quarter shall be
excluded for the entire quarter.

     Section 9.3. Total Liabilities to Total Adjusted Assets.  The Borrower will
not at any time permit Total  Liabilities to exceed sixty percent (60%) of Total
Adjusted Assets.

     12.  AMENDMENT  FEE AND LETTER OF CREDIT FEES.  As  consideration  for this
Amendment  the  Borrower  shall pay to the  Agent,  upon  execution  hereof,  an
Amendment Fee of $200,000.00. The Agent shall promptly distribute such Amendment
Fee among the Lenders in proportion to their respective  Commitment  Percentages
applicable after the Effective Date of this Amendment.  The Borrower shall delay
the  payment of the Letter of Credit Fees on the  outstanding  Letters of Credit
for the last  fiscal  quarter of 1998 from  October 1, 1998 until the  Effective
Date in order to permit the Agent to  appropriately  compute and allocate  among
the Lenders the total Letter of Credit Fees for such fiscal quarter, taking into
account the changes in the Commitment  Percentages and the Applicable  Margin on
the Effective Date.

     13.  AMENDMENT TO EXHIBIT C. Exhibit C is hereby  replaced by the Exhibit C
attached hereto.

     14. UPDATED SCHEDULES TO CREDIT AGREEMENT.  The following  Schedules to the
Credit Agreement are hereby updated, supplemented or replaced as follows:

     (a) Schedule 1.1 is replaced by Schedule 1.1 attached hereto.

     (b) Schedule 1.2 is replaced by Schedule 1.2 attached hereto.

     (c) Schedule 1.3 is replaced by Schedule 1.3 attached hereto.

     (d) Schedule 1.4 is replaced by Schedule 1.4 attached hereto.

     (e) Schedule 8.1(f) is replaced by Schedule 8.1(f) attached hereto.

     15. REPRESENTATIONS AND WARRANTIES.  The Borrower and the Company represent
and warrant that each of the representations and warranties contained in Section
6 is true,  correct and complete in all material  respects as of the date hereof
to the same  extent as though  made on such date and that no Default or Event of
Default has occurred and is continuing on the date hereof.

         16.  EFFECTIVENESS  OF  LOAN  DOCUMENTS.  The  Borrower  hereby
confirms  that each of the  Security  Documents  shall  continue  to secure  the
payment and performance of all of the Obligations  under the Existing  Agreement
as amended hereby and the Borrower's  obligations  under the Security  Documents
shall continue to be valid and  enforceable and shall not be impaired or limited
by the execution or effectiveness of this Amendment.  Every reference  contained
in the Loan Documents to the Credit  Agreement  shall mean and be a reference to
the Existing  Agreement  as amended  hereby and as the Credit  Agreement  may be
further amended. Except as specifically amended by this Amendment,  the Existing
Agreement and each of the Loan  Documents  shall remain in full force and effect
and are hereby ratified and confirmed.

     17.  MISCELLANEOUS.  This Amendment  shall be governed by,  interpreted and
construed in accordance  with all of the same  provisions  applicable  under the
Existing Agreement including,  without limitation,  all definitions set forth in
Section  1.1,  the  rules of  interpretation  set  forth  in  Section  1.2,  the
provisions  relating to  governing  law set forth in Section 20, the  provisions
relating  to  counterparts   in  Section  22  and  the  provision   relating  to
severability in Section 26.
                                      -4-
<PAGE>
     18. CONDITIONS TO  EFFECTIVENESS.  This Fifth Amendment to Credit Agreement
shall become effective on the earliest date (the "Effective  Date") that each of
the following conditions precedent have been satisfied:

     (a) Documents.  Each of (i) this Fifth Amendment to Credit Agreement,  (ii)
the Collateral Account Agreement, (iii) UCC Financing Statements with respect to
the  Collateral  Account,  (iv) the Fourth  Amendment to the  Guaranty,  and (v)
replacement  Loan  Notes  for  the  Lenders   reflecting  the  amount  of  their
Commitments  as  reduced  pursuant  hereto  shall  have been duly  executed  and
delivered by the respective  parties thereto,  shall be in full force and effect
and shall be in form and substance satisfactory to each of the Lenders.

     (b) Certified  Copies of Amendments of  Organization  Documents.  The Agent
shall have  received  a  Certificate  of the  Company  to which  there  shall be
attached complete copies of any amendments to the Borrower's Limited Partnership
Agreement,   Borrower's   Certificate  of  Limited   Partnership  the  Company's
Declaration of Trust or the Company's  Bylaws which have become  effective since
the complete certified copies of such documents which were previously  delivered
to the Agent.

     (c) Resolutions.  All action on the part of the Borrower and each Guarantor
necessary for the valid execution,  delivery and performance by the Borrower and
each  Guarantor of this Amendment and the other Loan Documents to which it is or
is to become a party shall have been duly and  effectively  taken,  and evidence
thereof  satisfactory  to the Agent shall have been  provided to the Agent.  The
Agent  shall have  received  from the  Company  true  copies of the  resolutions
adopted by its Board of Directors authorizing the transactions described herein,
certified  by its  secretary  to be  true  and  complete  and in  effect  on the
Effective Date.

     (d)  Opinions  of  Counsel.  Each of the  Lenders  and the Agent shall have
received  favorable opinions addressed to the Lenders and the Agent and dated as
of the Effective Date,  substantially  in the same form as, or with  appropriate
provisions  incorporating  by reference,  the opinions from  Borrower's  counsel
previously  delivered to the Lenders and the Agent, copies of which are attached
as Exhibit E to the Credit  Agreement  and as to the validity and  perfection of
the pledge pursuant to the Collateral Account  Agreement.  Such opinion may rely
on  opinions  from  other law firms  approved  by the Agent as to matters of law
applicable in the various states.

     (e) Receipt of Funds for Repayment of Loans and Initial  Collateral Account
Balance.  The Agent shall have received funds in the aggregate  amount necessary
to (i) repay in full all of the Loans outstanding hereunder as of the opening of
business on the Effective Date, (ii) fund the initial Collateral Account Balance
required by Section 5.6 and (iii) pay the fees  required by Paragraph 10 of this
Amendment.

     In the event that the Effective  Date has not occurred on or before October
15, 1998,  then this instrument  shall be void and the Existing  Agreement shall
remain in effect as though this instrument had never been executed.

     19.  RELEASE OF WEST WACKER  DRIVE  PROPERTY.  Each of the  Lenders  hereby
consents,  pursuant to Section  5.5,  to the  release of the West  Wacker  Drive
Property from the lien of the Security  Documents on the  Effective  Date hereof
and  authorizes  the Agent to execute  and  deliver a Release of  Mortgage,  UCC
financing  statement  terminations and other documents  reasonably  requested to
effect such  release and a Fourth  Amendment  of the  Guaranty  terminating  all
further  obligations  of 77  West  Wacker  Limited  Partnership  as a  Guarantor
thereunder.



















                                      -5-
<PAGE>
     IN WITNESS WHEREOF,  the undersigned have duly executed this Amendment as a
sealed instrument as of the date first set forth above.

                                       PRIME GROUP REALTY TRUST

                                       By: /s/ W. Michael Karnes
                                           ------------------------------------
                                               W. Michael Karnes
                                           ------------------------------------
                                           Its: Executive Vice President
                                                -------------------------------

                                       PRIME GROUP REALTY, L.P.

                                       By: PRIME GROUP REALTY TRUST,
                                           its managing general partner

                                       By: /s/ W. Michael Karnes
                                           ------------------------------------
                                               W. Michael Karnes
                                           ------------------------------------
                                           Its: Executive Vice President
                                                -------------------------------

                                       BANKBOSTON, N.A.

                                       By: /s/ Lori Y. Litow
                                           ------------------------------------
                                               Lori Y. Litow
                                           ------------------------------------
                                           Its: Vice President
                                                -------------------------------

                                       PRUDENTIAL SECURITIES CREDIT
                                       CORPORATION

                                       By: /s/ Jeff K. French
                                           ------------------------------------
                                               Jeff K. French
                                           ------------------------------------
                                           Its: 
                                                -------------------------------




































                                      -6-
<PAGE>
                                       MELLON  BANK, N.A.

                                       By: /s/ Janis R. Carey
                                           ------------------------------------
                                               Janis R. Carey
                                           ------------------------------------
                                           Its: Vice President
                                                -------------------------------

                                       SOCIETE GENERALE

                                       By: /s/ Robert N. Delph
                                           ------------------------------------
                                               Robert N. Delph
                                           ------------------------------------
                                           Its: Director
                                                -------------------------------

                                       COMMERZBANK AG

                                       By: /s/ Douglas P. Traynor
                                           ------------------------------------
                                               Douglas P. Traynor
                                           ------------------------------------
                                           Its: Vice President
                                                -------------------------------

                                       By: /s/ Christian Berry
                                           ------------------------------------
                                               Christian Berry
                                           ------------------------------------
                                           Its: Assistant Treasurer
                                                -------------------------------


                                       BANQUE NATIONALE DE PARIS

                                       By: /s/ Arnaud Collin du Bocage
                                           ------------------------------------
                                               Arnaud Collin du Bocage
                                           ------------------------------------
                                           Its: Executive Vice President
                                                and General Manager
                                                -------------------------------


































                                      -7-
<PAGE>
                                   SCHEDULE 1
                                   ----------

                Lenders; Domestic and Eurodollar Lending Offices
                ------------------------------------------------

Domestic and Eurodollar Lending Offices:     Notice Address:
----------------------------------------     ---------------

BankBoston, N.A.                             BankBoston, N.A.
100 Federal Street                           100 Federal Street
Boston, MA  02110                            Boston, MA  02110
(Domestic and Eurodollar)                    Attn: Real Estate Department

                                             With a copy to:

                                             BankBoston, N.A.
                                             115 Perimeter Center Place, N.E.
                                             Suite 500
                                             Atlanta, GA  30346
                                             Attn: Lori Y. Litow, Vice President
                                             Fax:  (770)390-8434 or 391-9811

Prudential Securities Credit Corporation     Prudential Securities Credit
One New York Plaza                            Corporation
New York, New York 10292                     One New York Plaza
(Domestic and Eurodollar)                    New York, NY  10292
                                             Attn: Fuller O'Connor, Director
                                             Phone: (212) 778-3720
                                             Fax: (212) 778-3194 or 2253
















































                                      -8-
<PAGE>
                                  SCHEDULE 1.1

         Mortgaged Properties                            Fee Owner
         --------------------                            ---------

1.  Hilton Parking Garage, Knoxville, TN       Triad Parking Company, Ltd.

2.  SunTrust Bank Bldg., 201 4th Ave., N.,
    Nashville, TN                              Nashville Office Building I, Ltd.

3.  The Weston, 4823 Kingston Pike,
    Knoxville, TN                              Old Kingston Properties, Ltd.

4.  One Centre Square, 620 Market St.,
    Knoxville, TN                              Professional Plaza, Ltd.

5.  Two Centre Square, 625 Gay St.,
    Knoxville, TN                              Centre Square II, Ltd.


       Assigned Mortgaged Properties                     Owner of Assigned Note
       -----------------------------                     ----------------------

              None






















































                                      -9-
<PAGE>
<TABLE>
                                  SCHEDULE 1.2

                                   Commitments
                                   -----------


<CAPTION>
                         Committment   Committment
                           prior to      prior to    Commitment %   Commitment
                          Effective     Effective      prior to     % on and after
       Lender               Date          Date      Effective Date  Effective Date
----------------------  ------------  ------------  --------------  --------------
<S>                     <C>           <C>           <C>             <C>
BankBoston, N.A.        $ 52,500,000  $ 40,000,000  27.6315789474%        50%

Prudential Securities   $ 52,500,000  $ 40,000,000  27.6315789474%        50%
Credit Corporation

Societe Generale        $ 25,000,000  $ 0           13.1578947368%         0%

Commerzbank, AG         $ 20,000,000  $ 0           10.5263157895%         0%

Banque Nationale de     $ 20,000,000  $ 0           10.5263157895%         0%
Paris

Mellon Bank, N.A.       $ 20,000,000  $ 0           10.5263157895%         0%
----------------------  ------------  ------------  --------------  --------------

Total                   $190,000,000  $ 80,000,000  100%                  100%
----------------------  ------------  ------------  --------------  --------------
</TABLE>














































                                      -10-
<PAGE>
<TABLE>
                                  SCHEDULE 1.4

                                Letters of Credit
                                -----------------

<CAPTION>
       Beneficiary                    Project                     Face Amount
-------------------------   -----------------------------   -------------------
<S>                         <C>                             <C>
First Tennessee Bank N.A.   Nashville Office Building
                               I, Ltd.                      $    4,915,069.00

First Tennessee Bank N.A.   Old Kingston Properties, Ltd.   $    3,583,905.00

First Tennessee Bank N.A.   Professional Plaza, Ltd.        $    9,215,754.00

First Tennessee Bank N.A.   Centre Square II, Ltd.          $    9,215,754.00
-------------------------   -----------------------------  --------------------
TOTAL                                                       $   26,930,482.00
                                                            82.00
-------------------------   -----------------------------  --------------------
</TABLE>























































                                      -11-
<PAGE>
<TABLE>
                                 SCHEDULE 8.1(f)

                              Recourse Indebtedness
                              ---------------------

<CAPTION>
       Lender              Total Credit Amount  Recourse Indebtedness
------------------------   -------------------  ---------------------
<S>                        <C>                   <C>
LaSalle National Bank      $  15,000,000.00      $    15,000,000.00

Bank One, Illinois         $  48,809,587.00      $    10,000,000.00

CIGNA Investments, Inc.    $  75,000,000.00      $     6,215,110.00

CIBC Oppenheimer           $  14,600,000.00      $     7,300,000.00

LaSalle National Bank      $  13,500,000.00      $     3,500,000.00
------------------------   -------------------  ---------------------
Total                                            $    42,015,110.00
------------------------   -------------------  ---------------------
</TABLE>























































                                      -12-
<PAGE>
                                    Exhibit C
                                    ---------

                            Prime Group Realty, L.P.
                        77 West Wacker Drive, Suite 3900
                                Chicago, IL 60601

                          Compliance Certificate under
           Credit Agreement dated as of November 17, 1997, as amended

     The undersigned, a Responsible Officer of Prime Group Realty Trust, general
partner of Prime Group Realty, L.P. (the "Borrower"), hereby certifies on behalf
of the Borrower as of the date hereof the following:

     1. NO  DEFAULTS.  I have read a copy of the  Credit  Agreement  dated as of
November  17,  1997 as amended  (the  "Credit  Agreement")  among the  Borrower,
BankBoston,  N.A., the other lending institutions party thereto, and BankBoston,
N.A., as Agent.  Terms used herein and not otherwise  defined  herein shall have
the  meanings  set forth in Section 1.1 of the Credit  Agreement.  No Default is
continuing in the  performance or observance of any of the  covenants,  terms or
provisions of the Credit  Agreement or any of the other Loan Documents.  Without
limiting  the  foregoing,  the  Borrower  has not  taken any  actions  which are
prohibited  by the  negative  covenants  set forth in  Section  8 of the  Credit
Agreement. Attached hereto as Appendix I are all relevant calculations needed to
determine  whether the Borrower is in compliance with Section 9, Section 8.3(e),
(g) and (h) and  Section 8.7 of the Credit  Agreement  as of the end of the most
recently  completed  fiscal  quarter  (except  that in the  case  of  Compliance
Certificates  delivered pursuant to Section 2.5, Section 2.9(b),  Section 2.9(d)
Section  11.1,  Section  5.5 or Section  8.4(b),  the  calculations  determining
compliance  with  Section  9.1,  Section 9.2 and  Section 9.3 are  computed on a
pro-forma  basis as of the date of such  certificate  and after giving effect to
the  proposed  transaction,  if  any,  with  respect  to  which  the  Compliance
Certificate is being  delivered),  and is in compliance  with Section 8.7 of the
Credit Agreement for the most recently completed fiscal year.

     2. NO MATERIAL  CHANGES,  ETC.  Except as  disclosed on Appendix II hereto,
since the [date of most recent financial  statements  furnished to the Agent and
the Lenders], there have occurred no materially adverse changes in the financial
condition  or business of the  Borrower as shown on or  reflected in the balance
sheet of the  Borrower  as at such date other than (a)  changes in the  ordinary
course  of  business  that have not had any  materially  adverse  effect  either
individually  or in the aggregate on the business or financial  condition of the
Borrower  and (b)  changes  resulting  from  the  making  of the  Loans  and the
transactions contemplated by the Credit Agreement.

     3. NO  MATERIALLY  ADVERSE  CONTRACTS,  ETC.  Neither the  Borrower nor the
Company is subject to any charter,  corporate, trust, partnership or other legal
restriction,  or any judgment,  decree, order, rule or regulation that has or is
expected, in the reasonable judgment of the Company's officers, in the future to
have a  Materially  Adverse  Effect.  Neither the  Borrower nor the Company is a
party to any contract or agreement  that has or is expected,  in the  reasonable
judgment of the Company's officers, to have a Materially Adverse Effect.

                                       Prime Group Realty, L.P.
                                       By: Prime Group Realty Trust,
                                       Its managing general partner

                                       By:_______________________________

                                          _______________________________

                                          Its:___________________________

Date:














                                      -13-
<PAGE>
                                                                     Appendix I
                                                                     ----------

                         FINANCIAL COVENANT CALCULATIONS
                         -------------------------------

Note: Unless otherwise indicated all calculations are as of ____________________
or for the fiscal  quarter  ending on such date (the "Fiscal  Quarter")  [except
that  paragraphs  1, 2 and 3 have  been  computed  on a  pro-forma  basis  as of
___________________   and  including  the  effect  of  the  following   proposed
transaction:_____________________.].  References  herein to the  "last  quarter"
mean the Fiscal  Quarter and  references to the "prior  quarter" mean the fiscal
quarter immediately preceding the Fiscal Quarter.

1.  Appraisal Value [Section 9.1]

    (a)  Principal of Outstanding Loans                           $____________

    (b)  Aggregate Face Amount of Outstanding Letters of Credit   $____________

    (c)  Collateral Account Balance                               $____________

    (d)  Pro Forma Principal Amount [a + b - c]                   $____________

    (e)  Collateral Value of Mortgaged                            $____________
         Properties (see attached Schedule
         of Collateral Values)

    (f)  60% of line (e)                                          $____________

    (g)  Collateral Value of Assigned Mortgaged                   $____________
         Properties (see attached Schedule
         of Collateral Values)

    (h)  50% of line (g)                                          $____________

    (i)  Sum of lines (f) and (h)                                 $____________

    COVENANT: (d) should be less than (i)

2.  Minimum Debt Service Coverage [Section 9.2]

    (a)  Net Operating Income for all of the Mortgaged
         Properties:                                              $____________

    (b)  Pro Forma Debt Service Charges for Mortgaged
         Properties based on three monthly payments of
         mortgage style amortization of the Pro Forma
         Principal Amount of $______________  amortized
         over 25 years at _______% per annum, being the
         greater of the current average interest rate on
         the Loans or 1.75% above the current ten year
         U.S. Treasury bill yield:                                $____________

    CALCULATIONS: (a)/(b) = _________ which is not less than 1.5

3.  Total Liabilities to Total Adjusted Assets [Section 9.3]

    (a)  Total liabilities from Fiscal Quarter balance sheet:     $____________
    (b)  Accounts payable and accrued expenses                    $____________
    (c)  Dividends payable                                        $____________
    (d)  Total Liabilities at end of Fiscal Quarter [a-b-c]       $____________
    (e)  Change in Indebtedness and letters of credit
         outstanding since end of Fiscal Quarter                  $____________
    (f)  Total Liabilities  [d+or-e]                              $____________
    (g)  Cash and cash equivalents:                               $____________
    (h)  Income before minority interest and extraordinary
         items last quarter                                       $____________
    (i)  Interest Expense last quarter                            $____________
    (j)  Depreciation and amortization last quarter               $____________
    (k)  Deferred rent receivable for prior quarter
         net of effect of last quarter property sales             $____________
    (l)  Deferred rent receivable for last quarter                $____________
    (m)  EBITDA last quarter per operating statement[h+i+j+k-l]:  $____________
    (n)  Proforma adjustments to last quarter EBITDA-see schedule $____________
    (o)  Proforma adjusted last quarter EBITDA[k+l]               $____________


                                      -14-
<PAGE>
    (p)  Income before minority interest and extraordinary items
         prior quarter                                            $____________
    (q)  Interest Expense prior quarter                           $____________
    (r)  Depreciation and amortization prior quarter              $____________
    (s)  Deferred rent receivable for quarter before prior
         quarter net of effect of prior quarter property sales    $____________
    (t)  Deferred rent receivable for prior quarter               $____________
    (u)  EBITDA prior quarter per operating statement [p+q+r+s-t]:$____________
    (v)  Proforma adjustments to prior quarter EBITDA-see
         schedule                                                 $____________
    (w)  Proforma adjusted prior quarter EBITDA[u+v]              $____________
    (x)  Annualized EBITDA [(o) + (w) times 2]:                   $____________
    (y)  Line (x) divided by 0.0975:                              $____________
    (z)  Total Adjusted Assets [(g) + (y)]:                       $____________

         CALCULATIONS:     (f)/(z)  = ____________ which is less than 60%

4.  Minimum Tangible Net Worth [Section 9.4]

    (a)  Total Assets (GAAP assets plus depreciation
         on Real Estate Assets)                                   $____________
    (b)  Total Liabilities (end of Fiscal Quarter)                $____________
    (c)  Intangibles                                              $____________
    (d)  Tangible Net Worth [(a)-(b)-(c)]                         $____________
    (e)  Net Offering Proceeds                                    $____________
    (f)  $350,000,000 plus .75 times (e)                          $____________

    COVENANT: Line (d) should exceed line (f)

5.  Total Operating Cash Flow to Interest Expense [Section 9.5]

    (a)  EBITDA (for Fiscal Quarter)                              $____________
    (b)  Gross leasable area of all Real Estate Assets            $____________
    (c)  Reserve Amount ((b) times $0.25 divided by 4)            $____________
    (d)  Total Operating Cash Flow [(a) - (c)]                    $____________
    (e)  Interest Expense (includes capitalized interest)         $____________

    CALCULATIONS: (d)/(e) = _____ which is not less than 2.0

6.  EBITDA to Fixed Charges [Section 9.6]

    (a)  EBITDA (for Fiscal Quarter)                              $____________
    (b)  Interest Expense (same as line 5(e))                     $____________
    (c)  Principal installments and current maturities            $____________
         not refinanced
    (d)  Preferred dividends and distributions                    $____________
    (e)  Fixed Charges (sum of lines (b), (c), and (d))           $____________

    CALCULATIONS: (a)/(e) = ____________which is not less than 1.75

7.  Permitted  Investments [Section 8.3(e), (g) and (h)]
    Attached  hereto  is a Schedule of all (a) Investments
    in mortgages and notes receivable,  (b)
    Permitted Developments in process as of ________________
    and (c) Investments in undeveloped land.

    (a)  Investments in mortgages and notes receivable
         (excluding Mortgages the acquisition of which
         has been expressly approved by the Requisite Lenders)    $____________
    (b)  Investments in Permitted Developments                    $____________
    (c)  Total Adjusted Assets (end of Fiscal Quarter)            $____________
    (d)  20% of Total Adjusted Assets                             $____________
    (e)  Investments in undeveloped land                          $____________
    (f)  10% of Total Adjusted Assets                             $____________

    COVENANT:
    Line (a) should not exceed  $25,000,000
    Line (b) should not exceed line (d)
    Line (e) should not exceed line (f)

8.  Distributions [Section 8.7]

    (a)  Total Distributions during most recently ended           $____________
         fiscal year
    (b)  Funds From Operations for said fiscal year               $____________
    (c)  Total Distributions during most recently ended
         fiscal quarter                                           $____________

                                      -15-
<PAGE>
    (d)  Funds from Operations for fiscal quarter referenced
         in (c)                                                   $____________
    (e)  Total Distributions during the fiscal quarter preceding
         the fiscal quarter referenced in (c)                     $____________
    (f)  Funds from Operations during fiscal quarter referenced
         in (e)                                                   $____________
    (g)  Total Distributions during the fiscal quarter preceding
         the fiscal quarter referenced in (e)                     $____________
    (h)  Funds from Operations during fiscal quarter referenced
         in (g)                                                   $____________

    CALCULATIONS:  (a)/(b) = _____% which is less than 90%
                   (c)/(d) = _____%
                   (e)/(f) = _____%
                   (g)/(h) = _____%

     At least one of the three percentages immediately above is less than 100%





























































                                      -16-
<PAGE>
                          SCHEDULE OF COLLATERAL VALUES

                                              Borrowing
Mortgaged    NOI      NOI      Reserve  Cap     Base     Appraised   Collateral
Property   Last Q  Previous Q  Amount   Rate    Value      Value       Value
---------  ------  ----------  -------  ----  ---------  ---------  ----------



























































Totals:
-------











                                      -17-
<PAGE>
                                   SCHEDULE OF
                              PERMITTED INVESTMENTS

I.  Mortgages:
    ----------

Location of Security       Maker of Note       Cost         Outstanding Balance
--------------------       -------------       ----         -------------------





II. Developments:
    -------------

                                                                    Scheduled
Project Location Size (sq. ft.)  Total Project Cost  Start Date  Completion Date
---------------- --------------  ------------------  ----------  ---------------





III.  Undeveloped Land:
      -----------------

Land Location                      Size (acres)                        Cost
-------------                      ------------                        ----

















































                                      -18-
<PAGE>
        SCHEDULE OF PROFORMA ADJUSTMENTS TO EBITDA PURSUANT TO DEFINITION
                            OF TOTAL ADJUSTED ASSETS

A. Adjustments to last quarter EBITDA for acquisitions made during last quarter
   [and since the end of the last quarter]

                              Operating
                                 and
                                RE Tax               EBITDA
                    Revenue      exp.                included     Adjustment
                     (full      Full      property      on            to
Acquisition   Date  quarter    quarter)   EBITDA     financials     EBITDA
-----------   ----  -------   ---------   --------   ----------   ----------







B. Adjustments to last quarter EBITDA for dispositions  made during last quarter
   [and since the end of the last quarter]



Disposition    Date    EBITDA from property included in last quarter financials
-----------    ----    --------------------------------------------------------









Total additions to last quarter EBITDA for acquisitions           $____________
Total subtractions from last quarter EBITDA for dispositions      $____________
Net proforma adjustments to last quarter EBITDA(enter on line 3k) $____________

C. Adjustments  to prior  quarter  EBITDA for  acquisitions  made during  prior
   quarter and during last quarter [and since the end of the last quarter]

                              Operating
                                 and
                                RE Tax               EBITDA
                    Revenue      exp.                included     Adjustment
                     (full      Full      property      on            to
Acquisition   Date  quarter    quarter)   EBITDA     financials     EBITDA
-----------   ----  -------   ---------   --------   ----------   ----------




D. Adjustments  to prior  quarter  EBITDA for  dispositions  made during  prior
   quarter and during last quarter [and since the end of the last quarter]

Disposition    Date    EBITDA from property included in last quarter financials
-----------    ----    --------------------------------------------------------




Total additions to prior quarter EBITDA for acquisitions          $____________
Total subtractions from prior quarter EBITDA for dispositions     $____________
Net proforma adjustments to prior quarter EBITDA(enter on line 3q)$____________












                                      -19-
<PAGE>
                                                                    APPENDIX II
                                                                    -----------

                                MATERIAL CHANGES
                                ----------------




































































                                      -20-