Edgar Filing: CARRAMERICA REALTY CORP

Filed Pursuant to Rule 424(b)(3)
Registration No. 333-73582
The information in this preliminary prospectus is not complete and may be
changed. This preliminary prospectus is not an offer to sell nor does it seek
an offer to buy these securities in any jurisdiction where such an offer or
sale is not permitted.

Subject to Completion. Dated December 3, 2001.
Prospectus Supplement to Prospectus dated November 26, 2001.

16,872,537 Shares

[LOGO] larger logo

CarrAmerica Realty Corporation

Common Stock

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All of the shares of common stock in the offering are being sold by
Security Capital Group Incorporated. We will not receive any of the proceeds
from the sale of the shares.

The common stock is listed on the New York Stock Exchange under the symbol
"CRE". The last reported sale price for the common stock on November 30, 2001
was $28.90 per share.

See the risk factors beginning on page S-6 to read about factors you should
consider before buying our common stock.

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Neither the Securities and Exchange Commission nor any other regulatory
body has approved or disapproved of these securities or passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is
a criminal offense.

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Per Share Total
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Initial price to public.............................. $ $
Underwriting discount................................ $ $
Proceeds, before expenses, to the selling stockholder $ $

To the extent that underwriters sell more than 16,872,537 shares of common
stock, the underwriters have the option to purchase up to an additional
2,530,880 shares of common stock from the selling stockholder at the initial
price to public less the underwriting discount.

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The underwriters expect to deliver the shares against payment in New York,
New York on December , 2001.

Goldman, Sachs & Co.
Salomon Smith Barney
Legg Mason Wood Walker
Incorporated
Wachovia Securities
Banc of America Securities LLC
Deutsche Banc Alex. Brown
A.G. Edwards & Sons, Inc.

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Prospectus Supplement dated December , 2001.

[Pictures of Properties]

PROSPECTUS SUPPLEMENT SUMMARY

The following summary is qualified in its entirety by the more detailed
information and financial statements, including the notes thereto, appearing
elsewhere in this prospectus supplement and the accompanying prospectus or
incorporated herein and therein by reference. You should read the accompanying
prospectus, as well as documents incorporated by reference in the prospectus,
including our financial statements and the notes to the financial statements,
before deciding whether to invest in our common stock. In this prospectus
supplement, "we," "us" and "our" refer to CarrAmerica Realty Corporation and
its majority-owned or controlled subsidiaries.

The Company

We are a fully integrated, self-administered and self-managed publicly
traded real estate investment trust. We focus on the acquisition, development,
ownership and operation of high-quality office properties located primarily in
selected markets across the United States.

As of September 30, 2001, we owned a greater than 50% interest in 254
operating office properties and two properties under construction. The 254
operating properties contain a total of approximately 20.3 million square feet
of net rentable area. The two properties under construction will contain
approximately 184,000 square feet of net rentable area. The operating
properties in which we owned a greater than 50% interest as of September 30,
2001 were 95.9% leased. These properties had approximately 1,000 tenants.

As of September 30, 2001, we also owned minority interests (ranging from
15% to 50%) in 34 operating office properties and six properties under
construction. The 34 operating properties contain a total of approximately 4.4
million square feet of net rentable area. The six properties under construction
will contain approximately 1.5 million square feet of net rentable area. The
operating properties in which we owned a minority interest as of September 30,
2001 were 96.8% leased.

Our primary business objectives are to achieve long-term, sustainable
per-share cash flow growth and to maximize stockholder value by acquiring,
developing, owning and operating office properties primarily in markets
throughout the United States that exhibit strong, long-term growth
characteristics. We believe we utilize our knowledge of our core markets to
evaluate market conditions in order to maintain strategic flexibility and
determine whether those conditions favor acquisition, development or capital
recycling/disposition. During the last five years, we have actively redeployed
capital between acquisitions and development in order to create a portfolio
with strong long-term growth prospects.

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We are currently focusing our capital in four of our core markets where we
feel we can create the most value and highest returns on our investments: San
Francisco Bay area, Washington, D.C. Metro area, Southern California, and
Seattle/Portland. These markets accounted for approximately 72% of our property
net operating income, or NOI, for the nine months ended September 30, 2001. The
following chart shows a breakdown by core market of the NOI generated by our
office properties for the nine months ended September 30, 2001:

[CHART]

San Francisco Bay Area 32%
Washington, D.C. Metro 20%
Souther California 12%
Seattle/Portland 8%
Other Markets 28%

From 1996 to 1998, we were very active in acquiring office properties as we
established an operating platform for our national business strategy. During
that time, we acquired an aggregate of approximately 18.4 million square feet
of net rentable area. We will selectively pursue acquisitions in our core
markets where appropriate opportunities exist, particularly when pricing yields
make acquisitions of existing properties attractive in comparison to new
property development. Our acquisition activity since 1998 has been limited.

Development of office properties has become an important component of our
growth strategy. Since the beginning of 1999, we have developed and placed in
service an aggregate of approximately 4.8 million square feet of net rentable
area. We believe that long-term investment returns resulting from properties we
develop should generally exceed those from properties we acquire, without the
assumption of significantly increased investment risks. In the current
environment, we have reduced our development activities significantly and we
are now primarily focused on the development of build-to-suit and substantially
pre-leased projects. Our research-driven development program enables us to
tailor our development activities in each core market, from inventory
development, build-to-suit projects and acquiring and holding land for future
development.

We also may dispose of assets that become inconsistent with our long-term
strategic or return objectives. We then redeploy the proceeds from the
dispositions into other office properties, or use them to fund development
operations or to support other corporate needs. We also may contribute
properties that we own into joint ventures with third parties. Since 1999, we
have received an aggregate of approximately $1.1 billion of proceeds from the
sale of assets to third parties and ventures in which we retained an interest,
which proceeds were utilized to fund other investments, repurchase shares of
our stock and pay down indebtedness.

In 2000, as investments in our stock became attractive relative to real
estate investment opportunities, we commenced a repurchase program for our
common stock. To date, we have repurchased approximately 17.9 million of our
shares for an aggregate purchase price of approximately $518.8 million,
including the recent repurchase of 9.2 million shares from Security Capital
Group Incorporated. We believe that we have achieved attractive yields on these
repurchases.

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We believe that our portfolio is occupied primarily by financially sound
tenants and is relatively insulated against difficult economic conditions. A
significant portion of our tenant base consists of Fortune 1000 and Fortune
Global 500 companies and government or quasi-governmental agencies.

For the nine months ended September 30, 2001, base rents for space in our
Class A office buildings that was re-leased after the existing lease expired
were, on average, approximately 23.9% greater than the base rents previously in
effect. We expect that our strength in re-leasing space quickly at higher rents
should result in continued NOI growth. The following table summarizes the
square footage of expiring leases in each of our markets, and the opportunity
to re-lease at higher base rents:

Expiring Square Footage in Core and Other Markets as of October 18, 2001

For the period
October 19 to
December 31, For the years ending December 31,
-------------- ---------------------------------------
Core Market 2001 2002 2003 2004 2005
----------- -------------- --------- --------- --------- ---------

San Francisco Bay
Square footage of expiring leases.................... 40,418 478,783 638,559 676,176 766,029
Weighted average annualized base rent per sq. ft. of
expiring leases(1).................................. $27.59 $24.22 $23.65 $27.94 $31.99
Weighted average Company quoted base rental rate
per sq. ft.(2)...................................... $41.73

Metro Washington D. C.
Square footage of expiring leases.................... 15,096 119,821 262,145 606,549 314,225
Weighted average annualized base rent per sq. ft. of
expiring leases(1).................................. $33.71 $32.63 $34.65 $32.58 $31.18
Weighted average Company quoted base rental rate
per sq. ft.(2)...................................... $36.23

Southern California
Square footage of expiring leases.................... 58,020 252,496 346,134 390,357 303,935
Weighted average annualized base rent per sq. ft. of
expiring leases(1).................................. $20.54 $15.65 $23.98 $23.10 $28.18
Weighted average Company quoted base rental rate
per sq. ft.(2)...................................... $27.10

Seattle/Portland
Square footage of expiring leases.................... 17,471 28,960 230,208 265,681 518,855
Weighted average annualized base rent per sq. ft. of
expiring leases(1).................................. $17.95 $20.53 $19.25 $17.20 $19.34
Weighted average Company quoted base rental rate
per sq. ft.(2)...................................... $21.04

All Other Markets
Square footage of expiring leases.................... 163,534 1,065,121 1,188,829 1,069,626 508,537
Weighted average annualized base rent per sq. ft. of
expiring leases(1).................................. $19.83 $20.40 $20.79 $22.08 $21.34
Weighted average Company quoted base rental rate
per sq. ft.(2)...................................... $21.17
------- --------- --------- --------- ---------
Total square footage of expiring leases............. 294,539 1,945,181 2,665,875 3,008,389 2,411,581
======= ========= ========= ========= =========

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(1) Annualized base rent equals total original base rent, including historical
contractual increases and excluding (i) percentage rents, (ii) additional
rent payable by tenants such as common area maintenance, real estate taxes
and other expense reimbursements, (iii) future contractual or contingent
rent escalations and (iv) parking rents.
(2) Represents the weighted average (based on square footage in our portfolio)
of our currently quoted rental rates for our office properties across each
market. There can be no assurance actual base rental rates will be
reflective of such quoted rates.

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We were organized as a Maryland corporation on July 9, 1992, but we or our
predecessor, The Oliver Carr Company, have developed, owned and operated office
buildings in the Washington, D.C. metropolitan area for more than 38 years. In
November 1995, we entered into a strategic alliance with a wholly-owned
subsidiary of Security Capital U.S. Realty in which Security Capital U.S.
Realty purchased 11.6 million shares of our stock. In January 2001, Security
Capital Group Incorporated acquired the assets of Security Capital U.S. Realty
(including the shares of our stock), and as a result, Security Capital Group
Incorporated, or certain of its subsidiaries (collectively, "Security
Capital"), now owns these shares. As of December 1, 2001, Security Capital
owned approximately 37.4% of our outstanding common stock, but will no longer
own any of our common stock if the underwriters' over-allotment option in this
offering is exercised in full.

Our experienced staff of approximately 850 employees, including about 470
on-site building employees, provides a broad range of real estates services.
Our principal executive offices are located at 1850 K Street, N.W., Washington,
D.C. 20006. Our telephone number is 202-729-7500. Our web site can be found at
www.carramerica.com.

Recent Developments

Financial Developments

For the three months ended September 30, 2001, we reported funds from
operations of $0.82 per diluted share, a 9.3% increase over the comparable
period in 2000. For the nine months ended September 30, 2001, we reported funds
from operations of $2.43 per diluted share, an increase of 9.5% over the
comparable period in 2000.

In November 2001, we declared and paid a dividend of $0.4625 per share of
our common stock for the third quarter of 2001.

Our Board of Directors has authorized us to spend up to $325 million to
repurchase our common shares, preferred shares, and debt securities, exclusive
of shares purchased from Security Capital. Since the start of this program in
mid-2000 through September 30, 2001, we acquired approximately 7.2 million
common shares for $209.4 million, representing an average price of $28.94 per
share. In October 2001, we repurchased an additional 1.5 million shares of
stock for $43.6 million, representing an average price of $29.37 per share.
This repurchase program has been temporarily suspended.

On November 19, 2001, we repurchased from Security Capital, the selling
stockholder offering the shares in this offering, 9.2 million shares of our
common stock at a price of $28.85 per share. The aggregate purchase price of
approximately $265.7 million was paid in cash, which we funded by drawing on
our $500 million unsecured credit facility with J.P. Morgan Chase, as agent for
a group of banks. After giving effect to the repurchases, at December 1, 2001
we had approximately $71.1 million available for borrowing under the line of
credit and Security Capital owned approximately 37.4% of our outstanding common
stock.

We are currently negotiating to obtain a $150 million short-term loan to
provide additional liquidity in the near term. The proposed loan is expected to
mature at the end of March 2002, and we expect to consummate the loan by the
end of December 2001. We also expect to refinance certain amounts outstanding
under our line of credit and any amounts drawn under the proposed term loan by
the end of the first quarter of 2002.

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Developments Regarding HQ Global Holdings

In June 2000, we sold a substantial portion of our equity interest in HQ
Global Holdings, Inc., our executive office suites affiliate, and our debt and
equity interests in two European executive suites affiliates, in connection
with the merger of HQ Global with VANTAS Incorporated. We received $377.3
million in cash, and recognized a gain net of tax of $31.9 million, in
connection with these transactions. Our remaining investment in the merged
entity is carried at $42.2 million and is accounted for using the cost method.
We own approximately 16% of the equity of the merged entity on a fully-diluted
basis.

As previously disclosed in our quarterly report for the quarter ended
September 30, 2001, FrontLine Capital Group, the majority stockholder of HQ
Global, recently announced that HQ Global is in default with respect to certain
covenant and payment obligations under its senior and mezzanine indebtedness.
HQ Global is in active negotiations with its lenders regarding the
restructuring of its long-term indebtedness. A forbearance period that was
agreed to by the senior loan lenders expires on December 14, 2001, or earlier
under certain circumstances. At the end of the forbearance period, if HQ Global
does not cure all of its existing defaults or obtain an extension of the
forbearance period, the lenders may immediately exercise any rights and
remedies available to them. Following the filing of our quarterly report,
FrontLine filed its quarterly report, in which it disclosed that it took an
impairment charge of $294.1 million with respect to its investment in HQ
Global.

Although no final decision has been made at this time, we are continuing to
evaluate our investment in HQ Global. In light of the impairment charge taken
by FrontLine and other factors, including that no agreement has been reached
with HQ Global's lenders as of the date of this prospectus supplement, we
believe that it is likely that we will write-off our remaining $42.2 million
investment in HQ Global during the fourth quarter of 2001. If such a write-off
occurs, a non-cash, one-time charge would be taken against our net income in
the fourth quarter of 2001, which would result in our net income and funds from
operations for the fourth quarter and 2001 being substantially below our
previous guidance for those periods.

The Offering

All of the shares of common stock offered by this prospectus supplement are
being offered by Security Capital. We will not receive any proceeds from the
sale of the common stock. After completing the sale of all of the shares of
common stock offered by this prospectus supplement, Security Capital will own
2,530,880 shares of common stock, which will represent approximately 4.9% of
our outstanding common stock as of September 30, 2001. If the underwriters'
over-allotment option is exercised in full, Security Capital will no longer own
any shares of our common stock.

S-5

RISK FACTORS

In addition to the other information in this prospectus supplement and
accompanying prospectus and the information incorporated by reference herein
and therein, you should consider carefully the following risk factors in
evaluating an investment in our common stock.

Our Performance is Subject to Risks Associated with Real Estate Investment

We are a real estate company that derives most of our income from the
ownership and operation of office buildings. There are a number of factors that
may adversely affect the income that our properties generate, including the
following:

. Economic Downturns. Downturns in the national economy, or in regions or
localities where our properties are located, generally will negatively
impact the demand for office space.

. Oversupply of Office Space. An oversupply of space in markets where we
own office properties would typically cause rental rates and occupancies
to decline, making it more difficult for us to lease space at attractive
rental rates.

. Competitive Properties. If our properties are not as attractive to
tenants (in terms of rents, services or location) as other properties
that are competitive with ours, we will lose tenants to those properties
or could have to reduce our rental rates to compensate for that disparity.

. Renovation Costs. In order to maintain the quality of our office
buildings and successfully compete against other properties, we
periodically have to spend money to repair and renovate our properties.

. Tenant Risk. Our performance depends on our ability to collect rent from
our tenants. While no tenant in our portfolio accounted for more than 5%
of our annualized base rent as of September 30, 2001, our financial
position may be adversely affected by financial difficulties experienced
by a major tenant, or by a number of smaller tenants, including
bankruptcies, insolvencies or general downturns in business.

. Reletting Costs. As leases expire, we try to either relet the space to an
existing tenant or attract a new tenant to occupy the space. In either
case, we likely will incur significant costs in the process. In addition,
if market rents have declined since the time the expiring lease was
entered into, the terms of any new lease signed likely will not be as
favorable to us as the terms of the expiring lease, thereby reducing the
income earned from that space.

. Regulatory Costs. There are a number of government regulations, including
zoning, tax and accessibility laws that apply to the ownership and
operation of office buildings. Compliance with existing and newly adopted
regulations may require us to spend a significant amount of money on our
properties.

. Fixed Nature of Costs. Most of the costs associated with owning and
operating an office building are not necessarily reduced when
circumstances such as market factors and competition cause a reduction in
income from the property.

. Environmental Problems. Federal, state and local laws and regulations
relating to the protection of the environment may require a current or
previous owner or operator of real property to investigate and clean up
hazardous or toxic substances or petroleum product releases at the
property. The clean up can be costly. The presence of or failure to clean
up contamination may adversely affect our ability to sell or lease a
property or to borrow using a property as collateral.

S-6

. Competition. A number of other major real estate investors with
significant capital compete with us. These competitors include publicly
traded REITs, private REITs, investment banking firms and private
institutional investment funds.

New Developments and Acquisitions May Fail to Perform As Expected

Over the last few years, we have embarked on a major acquisition and
development program. In deciding whether to acquire or develop a particular
property, we made certain assumptions regarding the expected future performance
of that property. If a number of these new properties do not perform as
expected, our financial performance will be adversely affected.

While our acquisition pace has declined significantly, we remain active in
developing office properties. New office property developments are subject to a
number of risks, including construction delays, complications in obtaining
necessary zoning, occupancy and other governmental permits, cost overruns,
financing risks, and the possible inability to meet expected occupancy and rent
levels. If any of these problems occur, development costs for a project will
increase, and there may be costs incurred for projects that are not completed.

We Do Not Have Exclusive Control Over Our Joint Venture Investments

We have invested in projects or properties as a co-venturer or partner in
the development of new properties and the continued operations of operating
properties. These investments involve risks not present in a wholly owned
project. Risks related to these investments include:

. Absence of exclusive control over the development, financing, leasing,
management and other aspects of the project;

. Possibility that our co-venturer or partner might:

. become bankrupt;

. have interests or goals that are inconsistent with ours;

. take action contrary to our instructions, requests or interests
(including those related to our qualification as a REIT for tax
purposes); or

. otherwise impede our objectives.

Our Use of Debt Subjects Us to Various Financing Risks

While we believe that we have a conservative borrowing policy, we do
regularly borrow money to finance our business, particularly the acquisition
and development of properties. We generally incur unsecured debt, although in
many cases we will incur mortgage debt that is secured by one or more of our
office buildings. There are risks inherent in borrowing money, including the
following:

. No Limitation on Debt Incurrence. Our organizational documents do not
limit the amount of debt we can incur. Our degree of leverage could have
important consequences, including making it more difficult for us to
obtain additional financing in the future for business needs, as well as
making us more vulnerable to an economic downturn.

. Possible Inability to Meet Scheduled Debt Payments. If our properties do
not perform as expected, the cash flow from our properties may not be
enough to make required principal and interest payments. If a property is
mortgaged to secure payment of indebtedness and we are unable to meet
mortgage payments, the holder of the mortgage or the lender could
foreclose on

S-7

the property, resulting in a loss of income and asset value. An unsecured
lender could also attempt to foreclose on some of our assets in order to
receive payment.

. Inability to Refinance Debt. In almost every case, very little of the
principal amount that we borrow is repaid prior to the maturity of the
loan. We generally expect to refinance that debt when it matures,
although in some cases we may pay off the loan. If principal amounts due
at maturity cannot be refinanced, extended or paid with proceeds of other
capital transactions, such as new equity capital, our cash flow may be
insufficient to repay all maturing debt. Prevailing interest rates or
other factors at the time of a refinancing (such as possible reluctance
of lenders to make commercial real estate loans) may result in higher
interest rates and increased interest expense.

. Financial Covenants Could Adversely Affect Our Financial Condition. Our
credit facilities and the indentures under which our senior unsecured
indebtedness are issued contain financial and operating covenants,
including coverage ratios and other limitations on our ability to incur
secured and unsecured indebtedness, sell all or substantially all of our
assets and engage in mergers, consolidations and certain acquisitions.
These covenants may restrict our ability to engage in transactions that
would otherwise be in our best interests.

. Variable Interest Rates Could Increase the Cost of Borrowing. A
significant amount of our financing is through an unsecured line of
credit. The line of credit is subject to variable floating interest
rates. Because we have not hedged against interest fluctuations,
significant increases in interest rates could dramatically increase our
costs of borrowing on the line of credit. Additionally, interest rates on
certain of our debt are based on the credit rating of our debt by
independent agencies, and would be increased in the event that the credit
ratings are downgraded.

Our Business Structure Has Certain Risks Associated With It

. Certain Officers and Directors May Have Interests that Conflict with the
Interests of Stockholders. Certain of our officers and members of our
board of directors own units of limited partner interest in Carr Realty,
L.P., a partnership that holds some of our properties. These individuals
may have personal interests that conflict with the interests of our
stockholders with respect to business decisions affecting us and Carr
Realty, L.P., such as interests in the timing and pricing of property
sales or refinancings in order to obtain favorable tax treatment. We, as
the sole general partner of Carr Realty, L.P., have the exclusive
authority to determine whether and on what terms Carr Realty, L.P. will
sell or refinance an individual property, but the effect of certain
transactions on these unitholders may influence decisions affecting these
properties.

. We May Not Be Able to Sell Properties When Appropriate. Real estate
property investments generally cannot be sold quickly. Agreements that we
have entered into with respect to certain properties owned by CarrAmerica
Realty, L.P. and Carr Realty, L.P. limit our ability to dispose of
property. Also, the tax laws applicable to REITs restrict our ability to
dispose of properties. Therefore, we may be unable to vary our portfolio
promptly in response to market conditions, which may adversely affect our
financial position.

. Lack of Voting Control Over Carr Real Estate Services, Inc. While most of
our income is generated from the ownership and operation of our office
buildings, we own a nonvoting interest in Carr Real Estate Services,
Inc., which produces a significant contribution to our income. Carr Real
Estate Services, Inc. conducts management and leasing operations for
third parties and for office buildings in which we own less than a 100%
interest. As of September 30, 2001, we owned approximately 95% of the
economic interest in Carr Real Estate Services, Inc.

S-8

through the ownership of nonvoting common stock. The voting common stock
of Carr Real Estate Services, Inc. is owned by The Oliver Carr Company.
As a result, we have no right to elect the directors of Carr Real Estate
Services, Inc., and our ability to influence its operations is limited.
Carr Real Estate Services, Inc. may engage in business activities that
are not in our best interests.

. We Depend On External Capital. To qualify as a REIT, we generally must
distribute to our stockholders each year at least 90% of our net taxable
income excluding net capital gains. Because of this distribution
requirement, we likely will not be able to fund all future capital needs,
including capital for property development and acquisitions, with income
from operations. We therefore will have to rely on third-party sources of
capital, which may or may not be available on favorable terms, if at all.
Our access to third-party sources of capital depends on a number of
things, including the market's perception of our growth potential and our
current and potential future earnings.

Certain Factors May Inhibit Changes in Control of the Company

. Charter and By-law Provisions. Certain provisions of our charter and
by-laws may delay or prevent a change in control of the Company or other
transactions that could provide our stockholders with a premium over the
then-prevailing market price of our common stock or that might otherwise
be in the best interests of our stockholders. These include a staggered
board of directors and the ability of our board of directors to authorize
the issuance of preferred stock without stockholder approval. Also, any
future series of preferred stock may have voting provisions that could
delay or prevent a change in control or other transaction that might
involve a premium price or otherwise be in the best interests of our
stockholders.

. Ownership Limit. In order to assist us in maintaining our qualification
as a REIT and for other strategic reasons, our charter contains certain
provisions generally limiting the ownership of shares of capital stock by
any single stockholder to 5% of our outstanding common stock and/or 5% of
any class or series of preferred stock. The federal tax laws include
complex stock ownership and attribution rules that apply in determining
whether a stockholder exceeds the ownership limits. These rules may cause
a stockholder to be treated as owning capital stock that is actually
owned by others, including family members and entities in which the
stockholder has an ownership interest. Our board of directors could waive
this restriction if it were satisfied that ownership in excess of these
ownership limits would not jeopardize our status as a REIT and the board
otherwise decided that a waiver would be in our interests. Capital stock
acquired or transferred in breach of the ownership limit will be
automatically transferred to a trust for the benefit of a designated
charitable beneficiary.

. Maryland Law Provisions. Certain provisions of Maryland law which are
applicable to us because we are a Maryland corporation prohibit "business
combinations" with any person that beneficially owns ten percent or more
of our outstanding voting shares (an "interested stockholder") or with an
affiliate of the interested stockholder. These prohibitions last for five
years after the most recent date on which the person became an interested
stockholder. After the five-year period, a business combination with an
interested stockholder must be approved by two super-majority stockholder
votes unless, among other conditions, our stockholders receive a minimum
price for their shares and the consideration is received in cash or in
the same form as previously paid by the interested stockholder for its
common shares. Our board of directors has opted out of these business
combination provisions. Consequently, the five-year prohibition and the
super-majority vote requirements will not apply to a business combination
involving us. Our board of directors may, however, repeal this election
in most cases and cause us to become subject to these provisions in the
future. Being subject to the provisions could delay or prevent a change
in control or other transactions that might involve a premium price or
otherwise be in the best interests of our stockholders.

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The Market Value of Our Securities Can Be Adversely Affected by Many Factors

As with any public company, a number of factors may adversely influence the
price of our common stock, many of which are beyond our control. These factors
include:

. Level of institutional interest in us;

. Perception of REITs generally and REITs with portfolios similar to ours,
in particular, by market professionals;

. Attractiveness of securities of REITs in comparison to other companies;

. Our financial condition and performance;

. The market's perception of our growth potential and potential future cash
dividends;

. Increases in market interest rates, which may lead investors to demand a
higher annual yield from our distributions in relation to the price paid
for our stock; and

. Relatively low trading volume of shares of REITs in general, which tends
to exacerbate a market trend with respect to our stock.

Sales of a substantial number of shares of our stock, or the perception
that such sales could occur, also could adversely affect prevailing market
prices for our common stock. In addition to the possibility that we may sell
shares of our stock in a public offering at any time, we also may issue shares
of common stock upon redemption of units of interest held by third parties in
affiliated partnerships that we control, as well as upon exercise of stock
options that we grant to our employees and others. All of these shares will be
available for sale in the public markets from time to time.

Our Status As a REIT

We believe that we qualify for taxation as a REIT for federal income tax
purposes, and we plan to operate so that we can continue to meet the
requirements for taxation as a REIT. If we qualify as a REIT, we generally will
not be subject to federal income tax on our income that we distribute currently
to our stockholders. Many of the REIT requirements, however, are highly
technical and complex. The determination that we are a REIT requires an
analysis of various factual matters and circumstances, some of which may not be
totally within our control and some of which involve questions of
interpretation. For example, to qualify as a REIT, at least 95% of our gross
income must come from specific passive sources, like rent, that are itemized in
the REIT tax laws. In determining that we have satisfied this requirement, we
have concluded that certain services, such as cafeteria services that we have
provided to tenants through an independent contractor in certain of our
properties under arrangements where we bear part or all of the expenses of such
services, are considered customary in the geographic area where such properties
are located. There can be no assurance that the IRS or a court would agree with
such conclusion or other positions we have taken in interpreting the REIT
requirements. We also are required to distribute to our stockholders at least
90% of our REIT taxable income (excluding capital gains). The fact that we hold
some of our assets through partnerships and their subsidiaries further
complicates the application of the REIT requirements. Even a technical or
inadvertent mistake could jeopardize our REIT status. Furthermore, Congress and
the IRS might make changes to the tax laws and regulations, and the courts
might issue new rulings, that make it more difficult, or impossible, for us to
remain qualified as a REIT.

If we fail to qualify as a REIT for federal income tax purposes, we would
be subject to federal income tax at regular corporate rates. Also, unless the
IRS granted us relief under certain statutory provisions, we would remain
disqualified as a REIT for four years following the year we first failed to
qualify. If we failed to qualify as a REIT, we would have to pay significant
income taxes. This likely would have a significant adverse affect on the value
of our securities. In addition, we would no longer be required to pay any
dividends to stockholders.

Even if we qualify as a REIT for federal income tax purposes, we are
required to pay certain federal, state and local taxes on our income and
property. For example, if we have net income from

S-10

"prohibited transactions," that income will be subject to a 100% tax. In
general, prohibited transactions are sales or other dispositions of property
held primarily for sale to customers in the ordinary course of business. The
determination as to whether a particular sale is a prohibited transaction
depends on the facts and circumstances related to that sale. While we have
undertaken a significant number of asset sales in recent years, we do not
believe that those sales should be considered prohibited transactions, but
there can be no assurance that the IRS would not contend otherwise. In
addition, any net taxable income earned directly by our taxable affiliates,
including Carr Real Estate Services, Inc. and CarrAmerica Development, Inc., is
subject to federal and state corporate income tax. To the extent that we and
our affiliates are required to pay federal, state and local taxes, we will have
less cash available for distributions to our stockholders.

Prior to December 31, 2000, a REIT could not own securities in any one
issuer if the value of those securities exceeded 5% of the value of the REIT's
total assets or the securities owned by the REIT represented more than 10% of
the issuer's outstanding voting securities. As a result of the REIT
Modernization Act, after December 31, 2000, the 5% value test and the 10%
voting security test were modified in two respects. First, the 10% voting
securities test was expanded so that REITs also are prohibited from owning more
than 10% of the value of the outstanding securities of any one issuer. Second,
an exception to these tests allows a REIT to own securities of a subsidiary
that exceed the 5% value test and the new 10% vote or value test if the
subsidiary elects to be a "taxable REIT subsidiary." Under a new asset test,
for taxable years beginning after December 31, 2000, we are not able to own
securities of taxable REIT subsidiaries that represent in the aggregate more
than 20% of the value of our total assets.

Several provisions of the new law ensure that a taxable REIT subsidiary
will be subject to an appropriate level of federal income taxation. For
example, a taxable REIT subsidiary is limited in its ability to deduct interest
payments made to an affiliated REIT. In addition, the REIT has to pay a 100%
penalty tax on some payments that it receives if the economic arrangements
between the REIT, the REIT's tenants, and the taxable REIT subsidiary are not
comparable to similar arrangements between unrelated parties.

We currently own more than 10% of the total value of the outstanding
securities of HQ Global Holdings Inc., Carr Real Estate Services, Inc. and
CarrAmerica Development, Inc. These entities have elected to be taxable REIT
subsidiaries.

S-11

USE OF PROCEEDS

We will not receive any proceeds from the sale of the stock covered by this
prospectus supplement.

CAPITALIZATION

The following table sets forth the capitalization of the Company as of
September 30, 2001 on a historical basis, and on an as adjusted basis giving
effect to share repurchases since September 30, 2001, including the repurchase
of 9.2 million shares from Security Capital and 1,486,100 shares on the open
market, funded by drawing on our existing line of credit.

September 30, 2001 As Adjusted
------------------ -----------
(In thousands)

Mortgages payable................................................. $ 522,239 $ 522,239
Other indebtedness................................................ 589,000 898,341
Minority interest................................................. 84,433 84,433
Stockholders' equity:
Preferred stock, $.01 par value, authorized 35,000,000 shares,
issued and outstanding 8,880,000 shares at September 30,
2001......................................................... 89 89
Common stock, $.01 par value, authorized 180,000,000
shares, issued and outstanding 62,487,942 shares at
September 30, 2001 and 51,801,842 shares at September
30, 2001 (as adjusted)....................................... 625 518
Additional paid-in capital........................................ 1,663,851 1,354,617
Cumulative dividends paid in excess of stockholders equity........ (132,071) (132,071)
---------- ----------
1,532,494 1,223,153
---------- ----------
Total capitalization....................................... $2,728,166 $2,728,166
========== ==========

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PRICE RANGE OF COMMON STOCK AND DIVIDEND HISTORY

Our shares of common stock have been traded on the NYSE under the symbol
"CRE" since February 1993. The following table sets forth the high and low
sales prices per share for the periods indicated as reported on the NYSE and
the dividends per share paid by us with respect to the periods noted.

Calendar Period High Low Dividends
--------------- ------ ------ ---------

1999:
First Quarter....................... $24.38 $20.94 $.4625
Second Quarter...................... $26.50 $20.94 $.4625
Third Quarter....................... $24.63 $21.50 $.4625
Fourth Quarter...................... $22.69 $17.94 $.4625
2000:
First Quarter....................... $20.77 $18.56 $.4625
Second Quarter...................... $27.44 $20.34 $.4625
Third Quarter....................... $30.27 $26.60 $.4625
Fourth Quarter...................... $31.50 $28.80 $.4625
2001:
First Quarter....................... $30.88 $27.83 $.4625
Second Quarter...................... $30.69 $27.00 $.4625
Third Quarter....................... $33.29 $27.78 $.4625
October 1, 2001 to November 30, 2001 $30.13 $28.00

In order to qualify as a REIT, we are required to make distributions (other
than capital gain distributions) to our stockholders in amounts at least equal
to (i) the sum of (A) 90% of its "REIT taxable income" (computed without regard
to the dividends paid deduction and its net capital gain) and (B) 90% of the
net income (after tax), if any, from foreclosure property, minus (ii) the sum
of certain items of non-cash income. Our distribution strategy is to distribute
what we believe is a conservative percentage of our cash flow, permitting us to
retain funds for capital improvements and other investments while funding our
distributions.

For Federal income tax purposes, distributions may consist of ordinary
income, capital gains, nontaxable return of capital or a combination thereof.
Distributions that exceed our current and accumulated earnings and profits
(calculated for tax purposes) constitute a return of capital rather than a
dividend and reduce the stockholder's basis in his or her shares of common
stock. To the extent that a distribution exceeds both current and accumulated
earnings and profits and the stockholder's basis in his or her shares, it will
generally be treated as gain from the sale or exchange of that stockholder's
shares. We annually notify stockholders of the taxability of distributions paid
during the preceding year. The following table sets forth the taxability of
distributions paid in 2000 and 1999:

2000 1999
---- ----

Ordinary income 84% 78%
Capital gain... 16% 22%

S-13

THE COMPANY

General

We are a fully integrated, self-administered and self-managed publicly
traded REIT. We focus on the acquisition, development, ownership and operation
of high-quality office properties, located primarily in selected markets across
the United States.

Business Strategy

Our primary business objectives are to achieve long-term sustainable per
share cash flow growth and to maximize stockholder value by acquiring,
developing, owning and operating office properties primarily in markets
throughout the United States that exhibit strong, long-term growth
characteristics. We believe we utilize our knowledge of our core markets to
evaluate market conditions in order to maintain strategic flexibility and
determine whether those conditions favor acquisition, development or capital
recycling/disposition. During the last five years, we have actively redeployed
capital between acquisitions and development in order to create a portfolio
with strong long-term growth prospects. Our financial strategy to meet our
business objectives is primarily based on deriving the highest returns from
capital invested in real estate by providing value-added services, including
development, leasing and management of the properties.

Our principal segment of continuing operations is real estate property
operations, which includes commercial property ownership. Other segments
include development operations and other operations, including management
services. Approximately 93.4% of our revenues from continuing operations for
the nine months ended September 30, 2001 were associated with our real estate
property operations. Our development operations are conducted by us through our
subsidiary, CarrAmerica Development, Inc. Our investment in this business
represented approximately 3.1% of our revenues from continuing operations for
the nine months ended September 30, 2001.

Competitive Advantages

Local Market Focus

We have focused our acquisition and development activity in U.S. markets
that possess long-term growth characteristics. We target markets in which:

. Long-term population and job growth are generally expected to exceed the
national average;

. Large, well educated employment pools exist; and

. Entry barriers exist for new supplies of office space.

We have established a local presence in each existing core market by
acquiring or developing a critical mass of properties. This local presence is
maintained through continuing investment activity and

S-14

relationships established by our seasoned professional Market Managing
Directors.

Our Market Managing Director group consists of nine individuals who cover
all of the markets in which we own property. These Directors are responsible
for maximizing the performance of our properties in their respective markets
and ensuring that we are consistently meeting the needs of our customers.
Because they meet with our customers and local brokers on a regular basis, the
Market Managing Directors have extensive knowledge of local conditions in their
respective markets and are invaluable identifying attractive investment
opportunities in them.

We are currently focusing capital in four of our core markets where we feel
we can create the most value and generate the highest returns on our
investments: San Francisco Bay area, Washington, D.C. Metro area, Southern
California and Seattle/Portland. These markets accounted for approximately 72%
of our property NOI for the nine months ended September 30, 2001. The following
chart shows a breakdown by core market of our property NOI for the nine months
ended September 30, 2001:

[CHART]

San Francisco Bay Area 32%
Washington, D.C. Metro 20%
Souther California 12%
Seattle/Portland 8%
Other Markets 28%

Flexible Investment Strategy

We have established a set of general guidelines and physical criteria to
evaluate how we allocate our capital resources among investments, including
acquisition, disposition and development opportunities. Our capital allocation
decisions are driven by real estate research, which focuses on variables such
as the economic growth rate, the composition of job growth and the office space
supply and demand fundamentals of a particular market.

Acquisitions

From 1996 to 1998, we were very active in acquiring office properties as we
established an operating platform for our national business strategy. During
that time, we acquired an aggregate of approximately 18.4 million square feet
of net rentable area. Our acquisition activity since 1998 has been limited. We
will selectively pursue acquisitions in our core markets where attractive
opportunities exist, particularly when pricing yields make acquisitions of
existing properties attractive in comparison to new property development. Due
to the current weak economic climate, we believe that we will be able to
exploit opportunities for attractive future investment.

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Development

. Employing extensively trained and experienced development personnel;

. Avoiding the assumption of entitlement risk in conjunction with land
acquisitions;

. Entering into guaranteed maximum price construction contracts with
seasoned and credible contractors;

. Focusing on pre-leasing space and build-to-suit opportunities with our
customer network; and

. Analyzing the supply and demand characteristics of a market before
commencing inventory development in that market.

In the current environment, we have reduced our development activities
significantly and we now are primarily focused on the development of
build-to-suit and substantially pre-leased projects. Our research-driven
development program enables us to tailor our development activities in each
core market, from inventory development, build-to-suit projects and acquiring
and holding land for future development.
Capital Recycling

We also may dispose of assets that become inconsistent with our long-term
strategic or return objectives. We then redeploy the proceeds from the
dispositions into other office properties, or use them to fund development
operations or to support other corporate needs. We also may contribute
properties that we own into joint ventures with third parties. Since 1999, we
have received approximately $1.1 billion of proceeds from the sale of assets to
third parties and ventures in which we retained an interest, which proceeds
were utilized to fund other investments, repurchase shares of our stock and pay
down indebtedness.

Stock Repurchases

In 2000, as investments in our stock became attractive relative to real
estate investment opportunities, we commenced a repurchase program for our
common stock. To date, we have repurchased approximately 17.9 million of our
shares for an aggregate purchase price of approximately $518.8 million,
including the recent repurchase of 9.2 million shares from Security Capital. We
believe that we have achieved attractive yields on these repurchases.

Joint Ventures

Joint venture arrangements provide us with opportunities to reduce
investment risk by diversifying capital deployment and enhancing returns on
invested capital from fee arrangements. We principally utilize these
arrangements on projects characterized by large dollar-per-square-foot costs
and/or our desire to limit capital deployment in certain of our core markets.
For example, in August 2000, we consummated a $422 million joint venture with
the New York State Teachers Retirement System. The transaction allowed us to
further our business strategy of increasing returns on our invested capital and
to recycle capital into and out of markets based on market dynamics. We
received approximately $249.6 million from the transaction at closing. In June
2001, the joint venture obtained third-party financing. We received $77.9
million of the financing proceeds.

Service Businesses

We are engaged through subsidiaries and affiliates in service businesses
that are directly related to our core business of owning, operating, developing
and leasing real estate. These businesses

S-16

include leasing services, property management for landlords, facilities
management for large tenants or other users and tenant improvement and
construction development services. Since 1999, we have been able to grow these
businesses through existing and new relationships. We believe that these
service businesses provide added revenues to increase our return on our
invested capital and will continue to be a significant focus.

National Platform

Our national platform provides us with critical mass in order to provide
access to many different sources of capital to achieve long-term sustainable
cash flow growth. Our national platform is designed to provide corporate users
of office space with a mix of products and services to meet their workplace
needs at both the national and local levels. We believe that through our
existing portfolio of operating properties, property development opportunities
and land acquired and currently held for development, we can generate
incremental demand. This can be accomplished through the relocation and
expansion needs of many of our customers, both within a single core market and
in multiple core markets.

Our National Development Group is responsible for developing office
properties, build-to-suit facilities and business parks for us and third
parties through our subsidiary, CarrAmerica Development Inc. This development
team consists of over 40 development and project management professionals, who
are located across the United States and have an average of over 17 years of
experience developing office properties. Our team oversees every aspect of land
planning, building design, construction and development of office properties.
This ensures that all projects meet the same high standards and uniform
specifications in building design and systems. We believe that the National
Development Group's expertise has given us a competitive edge in marketing our
facilities and services to customers.

Experienced Employees

We believe our national platform allows us to attract highly qualified
employees who seek the opportunities and the challenges that a national company
can provide. We have attracted accomplished employees from many industries in
order to integrate the best practices of many businesses into our real estate
operations.

Featured Properties in Core Markets

We have focused our acquisition and development activity in U.S. markets
that possess long-term growth characteristics. We target markets in which
long-term population and job growth are generally expected to exceed the
national average, where large, well educated employment pools exist, and where
entry barriers exist for new suppliers of office space. We have established a
local presence in each existing core market. This has been done through our
investment activity and relationships established by our seasoned professional
Market Managing Directors.

San Francisco Bay Area

Our largest property NOI concentration is in the San Francisco Bay area,
with approximately 32% of our property NOI for the nine months ended September
30, 2001 coming from assets in this market. We own more than 5.4 million square
feet in Silicon Valley, East Bay and San Francisco Peninsula, or 27% of our
total portfolio. Our single largest asset in this market is CarrAmerica
Corporate Center, located in Pleasanton in the East Bay. With over one million
rentable square feet, this property generates in excess of $19.2 million in
aggregate annualized base rent based on leases that have been executed and
commenced as of September 30, 2001. Valley Technology Center in San Jose is our
next largest asset in this market, with 460,000 square feet and $10.7 million
in aggregate annualized base rent based on leases that have been executed and
commenced as of September 30, 2001. The majority of our assets in this market
are located in Silicon Valley.

S-17

Washington, D.C. Metro Area

The Washington, D.C. Metro area is our second largest concentration in the
portfolio. Approximately 20% of our property NOI for the nine months ended
September 30, 2001 came from this area. The largest asset in the market is the
one million square foot International Square complex located centrally in the
business district between 18th and 19th Streets and Eye and K Streets. The
complex is atop the 2nd busiest Metro station -- Farragut West on the Blue and
Orange Lines. The property generates over $33.5 million in aggregate annualized
base rent based on leases that have been executed and commenced as of September
30, 2001. The second largest concentration is on the 1700 block of Pennsylvania
Avenue, where we own interests in approximately 762,000 square feet of property
in four different locations.

Southern California

Together, Los Angeles, Orange County and San Diego represent 12% of our
property NOI for the nine months ended September 30, 2001 and reflect the third
largest concentration of property NOI in our portfolio. We own 2.9 million
square feet in this market, which is 14% of our total portfolio. Our largest
asset in the market is the 343,000 square feet Warner Center in San Fernando
Valley, just off the 101 Freeway, which generates $8.6 million in aggregate
annualized base rent based on leases that have been executed and commenced as
of September 30, 2001. The next largest asset is Highlands Corporate Center in
San Diego, with 205,000 square feet, which generates $5.7 million in aggregate
annualized base rent based on leases that have been executed and commenced as
of September 30, 2001.

Seattle/Portland

Seattle and Portland together comprise our fourth largest concentration and
contributed approximately 8% of our property NOI for the nine months ended
September 30, 2001. Three assets comprise the majority of property NOI in the
Seattle market: Willow Creek Corporate Center, Redmond East and Canyon Park.
Each of these three assets contributes in excess of $5 million in aggregate
annualized base rent based on leases that have been executed and commenced as
of September 30, 2001. Willow Creek and Redmond East are located in the Redmond
submarket, east of downtown Seattle. Canyon Park is north of the downtown
market in Bothell, Washington. We also own two office parks located east of
downtown Portland that comprise an aggregate of approximately 275,000 square
feet of net rentable area in six buildings. These properties generate
approximately $4.4 million in aggregate annualized base rent based on leases
that have been executed and commenced as of September 30, 2001. Our Portland
market is managed by our Seattle Market Managing Director.

S-18

PROPERTIES

Net Total Average
Rentable Annualized Base
Number Area in Base Rent/
of Square Percent Rent(3) Leased
Buildings Feet(1) Leased(2) ($000s) Sq. Ft.(4) Significant Tenants(5)
--------- --------- --------- ---------- ---------- -------------------------------

Consolidated Properties

EAST REGION

Downtown Washington, D.C.:
International Square 3 1,014,556 99.8% $33,578 $33.15 International Monetary Fund
(49%)
900 19th Street 1 101,215 97.7% 3,230 32.65 America's Community Bankers
(30%), Stone & Webster (13%),
Korn/Ferry International (12%),
Lucent Technologies (11%)
2550 M Street 1 187,931 100.0% 8,191 43.58 Patton Boggs, L.L.P. (99%)
1730 Pennsylvania Avenue(6) 1 229,377 99.6% 8,269 36.18 Federal Deposit Insurance Corp.
(47%), King & Spalding (39%)
1255 23rd Street(7) 1 306,395 96.4% 8,449 28.62 Chronicle of Higher Education
(30%), William M. Mercer (21%),
J&H/Marsh & McLennan, Inc.
(14%)
1747 Pennsylvania Avenue 1 152,104 99.8% 4,999 32.92 Legg Mason (20%)
1775 Pennsylvania Avenue 1 143,981 97.5% 4,072 29.00 Citicorp Savings of Washington,
D.C. (81%)
Suburban Washington, D.C.:
One Rock Spring Plaza(6) 1 205,721 98.1% 5,525 27.37 Caterair International (22%),
Sybase, Inc. (19%)
Sunrise Corporate Center 3 260,253 100.0% 6,331 24.33 Software AG of North America
(82%)
Reston Crossing East & West 2 327,788 100.0% 6,556 20.00 Nextel Communications, Inc.
(100%)
Atlanta, GA:
Glenridge 1 64,603 96.7% 1,233 19.74 Brooks, McGinnis & Chafin, LLC
(12%), Metropolitan Life
Insurance (12%), Spectrum
Realty Advisors (12%),
Communications Trends, Inc.
(11%)
Century Springs West 1 95,074 78.0% 1,436 19.37 No tenant occupies 10%
Holcomb Place 1 72,889 100.0% 1,306 17.91 Intercept Group, Inc. (49%),
Hitachi Telecom (USA), Inc.
(20%), Progeni Corp. (13%)

S-19

Midori 1 99,691 100.0% 1,928 19.34 National Consumer Services
(66%), United Parcel Service
(21%)
Parkwood 1 150,270 97.6% 2,937 20.04 Onesource (22%),
Corecommerce (11%)
Lakewood 1 80,483 50.1% 723 17.94 Paychex, Inc. (28%)
The Summit 1 179,085 100.0% 3,299 18.42 Unisys Corporation (86%), CSC
Continum, Inc. (14%)
Spalding Ridge 1 128,233 99.3% 2,644 20.77 IT Corporation (57%)
2400 Lake Park Drive 1 100,918 77.0% 1,329 17.09 United Health Care Services, Inc.
(29%), GSA (17%)
680 Engineering Drive 1 62,154 59.5% 376 10.17 Enrev Corporation (33%), EMS
Technologies (26%)
Embassy Row 3 464,895 89.9% 7,834 18.74 Ceridian Corporation (24%),
Cabot Corporation (10%)
Embassy 100, 500 2 190,470 100.0% 4,168 21.88 Art Institute of Atlanta, Inc. (60%),
Career Education Corp. (40%)
Waterford Centre 1 82,344 83.3% 1,369 19.97 Arkwright Mutual Insurance
(15%)
East Region Subtotal: 31 4,700,430 95.7%

PACIFIC REGION
Southern California,
Orange County/Los Angeles:
Scenic Business Park 4 138,076 100.0% 2,328 16.86 Miles, Wright, Finely & Zak
(19%), Terayon Communication
Systems (17%), Coast
Community College Dist. (13%),
So. Ca. Blood & Tissue Service
(12%)
Harbor Corporate Park 4 151,924 93.0% 2,763 19.55 Delmas Management (25%),
Clayton Environmental (10%)
Plaza PacifiCare 1 104,377 100.0% 1,064 10.19 Pacificare Health Systems, Inc.
(100%)
Katella Corporate Center 1 80,609 97.1% 1,431 18.29 No tenant occupies 10%
Warner Center 12 343,486 99.7% 8,615 25.15 El Camino Resources, Inc.
(25%), GSA (17%)
South Coast Executive Center 2 161,692 65.7% 2,748 25.89 No tenant occupies 10%
Warner Premier 1 61,553 64.3% 1,091 27.55 Protective Life Insurance Co.
(34%), Charles Schwab (12%)
Von Karman 1 104,138 100.0% 2,636 25.32 Vision Solutions, Inc. (41%),
Fidelity National Title Insurance
(26%), Taco Bell Corp. (18%)
2600 W. Olive 1 144,831 100.0% 3,704 25.57 Walt Disney Company (89%)
Bay Technology Center 2 107,481 100.0% 1,657 15.41 Amresco Residential Mortgage
(57%), Aqcess Technologies, Inc.
(43%)
Pacific Corporate Plaza 1, 3 125,298 100.0% 2,401 19.16 Zland.com, Inc. (24%), Covenant
2, & 3 Care California, Inc. (16%),
Aqueduct, Inc. (16%), AMFM
Systems Inc. (12%)
Alton Deere Plaza 6 182,183 90.2% 2,823 17.19 Nextlink (34%), Foster Wheeler
Environmental (11%), XO
California (10%)
Westlake Spectrum 2 108,084 100.0% 2,060 19.06 Pinkerton's Inc. (67%), Valueclick
(21%), Insweb Corp. (12%)

S-20

Southern California,
San Diego:
Del Mar Corporate Plaza 2 123,142 100.0% 3,362 27.31 Stellcom, Inc. (79%), Peregrine
Systems, Inc. (21%)
Wateridge Pavilion 1 62,194 73.5% 801 17.52 Infogation Corp. (25%),
Wateridge Insurance Service
(18%), TCA Mortgage, Inc. (14%)
Towne Center Technology 3 182,120 100.0% 3,116 17.11 Gateway, Inc. (100%)
Park 1, 2, 3
Lightspan 1 64,800 100.0% 1,182 18.24 Lightspan Partnership, Inc.
(100%)
La Jolla Spectrum 1 & 2 2 156,653 100.0% 4,799 30.64 Torrey Mesa Research Institute
(51%), Scripps Research Institute
(49%)
Palomar Oaks Technology 6 170,357 100.0% 2,285 13.41 Unifet, Inc. (23%), Excalibur
Park Techologies Corp. (18%), TPR
Group, Inc. (13%), Pacific
Analytical, Inc. (11%)
Jaycor 1 105,358 100.0% 1,896 18.00 Gateway, Inc. (100%)
Highlands Corporate Center 5 205,085 88.6% 5,700 31.37 No tenant occupies 10%
Northern California,
San Francisco Bay Area:
CarrAmerica Corporate Center 7 1,004,670 99.8% 19,202 19.15 AT&T (47%), Peoplesoft, Inc.
(32%), Pacific Bell Mobile
Services ( 17%)
Valley Business Park I 2 67,784 100.0% 1,634 24.11 Leybold Infocon, Inc. (35%),
Informative Inc. (17%), Millipore
(17%), Acer Labs, Inc. (15%)
Bayshore Centre 2 1 94,874 100.0% 1,935 20.40 Redback Networks, Inc. (100%)
Rincon Centre 3 201,178 100.0% 5,076 25.23 Propel Software Corp. (44%),
Toshiba America Electronic
(31%), Future Electronics Corp.
(19%)
Valley Centre II 4 212,082 100.0% 3,673 17.32 Boston Scientific (100%)
Valley Office Centre 2 68,881 96.4% 2,294 34.54 Bank of America (21%), Quadrep,
Inc. (13%)
Valley Centre 2 102,291 100.0% 2,002 19.58 Seagate Technology (40%),
Numerical Technologies, Inc.
(38%), Vivace Networks (22%)
Valley Business Park II 6 166,928 100.0% 3,473 20.81 Pericom Semiconductor Corp.
(40%),
Rio Robles 7 368,178 100.0% 5,970 16.21 Fujitsu Microelectronics (41%),
KLA Instruments Corp. (36%)
First Street Technology Center 1 67,582 100.0% 1,014 15.00 Comdisco, Inc. (100%)
Baytech Business Park 4 300,000 100.0% 5,366 17.89 Schlumberger Technologies
(58%), Caspian Networks (25%),
Rapid 5 Networks, Inc. (12%)
3571 North First Street 1 116,000 100.0% 3,062 26.40 Sun Microsystems, Inc. (100%)
San Mateo Center I 1 70,000 0.0% -- --
Oakmead West Land A-G 7 425,981 100.0% 9,712 22.80 Applied Materials, Inc. (100%)
San Mateo II & III 2 141,404 62.3% 3,595 40.79 Women.com Networks (32%)
Hacienda West 2 208,590 93.8% 5,623 28.74 Paychex, Inc. (13%), Sun
Microsystems (13%)
Sunnyvale Technology Center 5 165,520 100.0% 3,396 20.52 Lattice Semiconductor Corp.
(51%), BMC Software (25%),
Nokia Internet Comm. (12%),
Metelics Corp. (12%)

S-21

Net Total Average
Rentable Annualized Base
Number Area in Base Rent/
of Square Percent Rent(3) Leased
Buildings Feet(1) Leased(2) ($000s) Sq. Ft.(4) Significant Tenants(5)
--------- ---------- --------- ---------- ---------- ---------------------------------

Clarify Corporate Center 1, 2, 4 258,048 100.0% 6,637 25.72 Nortel Networks, Inc. (100%)
3, 4
Valley Technology Center 1, 7 460,590 100.0% 10,678 23.18 Lattice Semiconductor Corp.
2, 3, 4, 5, 6 & 7 (29%), TSMC North America, Inc.
(24%), Fore Systems (18%),
Navisite, Inc. (14%)
Golden Gateway Commons 3 273,801 95.3% 9,345 35.81 Sharper Image Corp. (21%),
Norcal Mutual Insurance Co.
(20%), ABM Industries, Inc.
(11%)
Techmart Commerce Center 1 252,454 97.6% 10,376 42.09 Network Conference Co., Inc.
(15%)
Fremont Technology Park 1, 3 139,304 100.0% 2,564 18.41 Applied Fiber Optics, Inc. (39%),
2, 3 Flash Electronics, Inc. (32%),
Bandwidth Unlimited, Inc. (29%)
Mountain View Gateway 2 236,400 100.0% 5,141 21.75 KPMG LLP (57%), Netscape
Center Communications Corp. (43%)
Portland, OR:
Sunset Corporate Park 3 132,531 80.9% 1,438 13.42 First Insight Corp. (34%),
Volkswagen of America, Inc.
(34%)
Rock Creek Corp Center 3 142,662 100.0% 2,996 21.00 Corillian Corp. (86%), University
of Phoenix (14%)
Seattle, WA:
Redmond East 10 396,497 95.3% 5,202 13.77 Avaya, Inc. (21%), Cardiac
Pacemakers Inc. (20%),
Riverdeep Group (15%), Genetic
Systems (14%)
Redmond Hilltop B & C 2 90,880 100.0% 1,515 16.67 Concur Technologies (90%),
Citrix Systems Inc. (10%)
Canyon Park 6 316,978 99.1% 5,010 15.94 Icos Corp. (28%), Targeted
Genetics Corp. (24%), Federal
Express Corp. (14%)
Willow Creek 1 96,179 100.0% 981 10.20 Data I/O Corp. (100%)
Willow Creek Corp. Center 1, 6 329,009 100.0% 5,502 16.72 Safeco Insurance Co. of America
2, 3, 4, 5, & 6 (51%), Metawave
Communications (29%), Nextlink
Communications, Inc. (13%)
Canyon Park Commons 1, 2, 3 176,846 100.0% 2,251 12.73 Washington Mutual Bank (62%),
4 AT&T Wireless (38%)
Canyon Park Commons 1 95,290 100.0% 1,342 14.08 Safeco Insurance Co. (100%)

Pacific Region Subtotal: 173 10,062,853 96.5%

CENTRAL REGION
Austin, TX:
City View Centre 3 136,183 24.0% 531 16.22 Cofiniti (21%)
City View Centre 1 128,716 100.0% 2,073 16.10 Broadwing Telecommunication
(100%)
Braker Point 1 195,230 100.0% 3,104 15.90 Harcourt, Inc. (100%)
Tower of the Hills 2 166,149 98.5% 2,947 18.01 Texas Guaranteed Student Loan
(74%)
Chicago, IL:
Parkway North I 1 249,314 80.6% 3,182 15.84 Alliant Foodservice, Inc. (53%)
Unisys 2 365,244 97.4% 5,631 15.84 Washington Mutual Home Loan
(30%), Hub Group, Inc. (11%)

S-22

The Crossings 1 295,308 94.5% 5,119 18.33 Abercrombie & Kent Internat'l
(16%), Allstate Insurance Co.
(14%)
Bannockburn I & II 2 209,540 90.1% 3,078 16.31 IMC Global, Inc. (39%), Parexel
(21%)
Bannockburn IV 1 105,756 95.9% 1,648 16.26 Open Text, Inc. (34%), Abbott
Laboratories (13%), New York
Life Insurance (11%)
Dallas, TX:
Cedar Maple Plaza 3 113,343 87.9% 2,296 23.06 A.G. Edwards & Sons, Inc. (11%)
Quorum North 1 116,178 95.0% 2,292 20.76 Digital Matrix Systems, Inc.
(20%), HQ Global Workplaces,
Inc. (20%)
Quorum Place 1 178,296 90.9% 3,075 18.97 VHA Southwest, Inc. (22%),
McCann-Erickson USA, Inc.
(13%), Objectspace, Inc. (11%)
Tollway Plaza 1, 2 2 359,903 100.0% 8,407 23.36 Sun Microsystems, Inc. (27%),
Americorp Relocation Mgmt.
(10%), HQ Global Workplaces,
Inc. (10%)
Two Mission Park 1 77,832 100.0% 1,373 17.64 Macromedia, Inc. (32%), Bland,
Garvey & Taylor, Inc. (17%)
Commons @ Las Colinas 1, 3 604,234 100.0% 11,763 19.47 Nokia, Inc. (100%)
2, 3
5000 Quorum 1 162,165 94.2% 3,090 20.23 Case Corporation (11%)
Central Region Subtotal: 26 3,463,391 92.8%

MOUNTAIN REGION
Denver, CO:
Harlequin Plaza 2 329,273 98.2% 5,913 18.28 Travelers Insurance (17%),
Bellco First Federal Credit (12%),
Regis University (12%)
Quebec Court I 1 130,000 100.0% 2,144 16.50 Time Warner Communications
(100%)
Quebec Court II 1 157,294 100.0% 2,694 17.13 Tele-Communications, Inc.
(100%)
Quebec Centre 3 106,865 93.5% 1,856 18.58 Eonbusiness Corporation (12%),
Walberg, Dagner & Tucker, P.C.
(11%)
Dry Creek 3 1 92,356 100.0% 1,339 14.50 AT&T Broadband Management
(100%)
Phoenix, AZ:
Qwest Communications 4 532,506 100.0% 9,503 17.85 Qwest Communications (100%)
Salt Lake City, UT:
Sorenson Research Park 5 282,944 96.7% 3,328 12.16 Convergys Customer Mgmt
(47%), Intel Corp. (15%), ITT
Educational Services, Inc. (12%)
Wasatch Corporate Center 3 178,231 97.5% 2,336 13.45 Advanta Bank Corp. (28%),
Achieveglobal, Inc. (23%), Fonix
Corp. (14%), Tenfold Corp.
(14%), Musician's Friend, Inc.
(12%)
Wasatch Corporate Center 2 121,654 100.0% 1,828 15.03 Ebay, Inc. (59%), Citrix Systems
17, 18 (21%), Western Aggregates, Inc.
(15%)

S-23

Net Total Average
Rentable Annualized Base
Number Area in Base Rent/
of Square Percent Rent(3) Leased
Buildings Feet(1) Leased(2) ($000s) Sq. Ft.(4) Significant Tenants(5)
--------- ---------- --------- ---------- ---------- ---------------------------------

Sorenson X 1 41,288 100.0% 780 18.90 Electronic Data Systems (73%),
Volvo Commercial Credit Corp.
(13%)
Creekside I & II 1 78,000 100.0% 1,032 13.23 3Com Corporation (100%)

Mountain Region Subtotal: 24 2,050,411 98.7%

TOTAL CONSOLIDATED
PROPERTIES: 254 20,277,085 418,611
WEIGHTED AVERAGE 95.9% 20.64
Unconsolidated Properties
Washington, D.C.:
1919 Pennsylvania Avenue(8) 1 328,431 98.7% 8,810 37.04 Allied Capital Corporation (24%),
Mortgage Bankers Association
(22%), Cole, Raywid &
Braverman, LLP (16%), Porter
Wright Morris & Arthur (13%),
Jenkens & Gilchrist, P.C. (12%)
2025 M Street(8) 1 245,303 99.5% 4,845 27.72 Radio Free Asia (32%), Smith,
Bucklin & Assoc. (27%)
1201 F Street(9) 1 226,871 96.0% 6,636 30.85 Charles River Associates, Inc.
(20%), Cadwalader, Wickersham
(18%), Health Insurance
Association (18%), National
Federation of Independent (17%)
Bond Building(10) 1 242,787 98.4% 2,181 27.23 General Services Administration
(97%)
1717 Pennsylvania 1 236,455 98.1% 6,801 36.88 MCI Telecommunications (57%)
Avenue(11)
Booz-Allen & Hamilton 1 222,989 100.0% 3,706 16.62 Booz, Allen & Hamilton (100%)
Building(11)
Portland, OR:
GM Call Center(12) 1 103,279 100.0% 1,232 11.93 GM Call Center (100%)
Chicago, IL:
Parkway 3, 4, 5, 6, 10(9) 5 653,914 99.2% 11,083 17.87 Fujisawa USA, Inc. (20%),
Associates Commerce Solutions
(14%), Shand Monahan & Co.
(13%), BT Office Products (10%)
Dallas, TX:
Royal Ridge Phase II, A,B(9) 4 503,751 88.9% 7,617 17.00 Capital One Services, Inc (32%),
GTE North, Inc. (29%), American
Honda Finance Corp. (13%)
Austin, TX:
Riata Corporate and Riata 12 997,678 100.0% 16,533 16.77 Janus Capital Corp. (32%),
Crossing(9) Electronic Data Systems (27%)
Denver, CO:
Panorama I, II, III, V, VIII, X(9) 6 664,050 91.0% 11,528 19.07 Charles Schwab & Co., Inc.
(41%), AT&T Corp. (13%)
TOTAL UNCONSOLIDATED
PROPERTIES: 34 4,425,508 80,972
WEIGHTED AVERAGE 96.8% 18.30
ALL OPERATING
PROPERTIES TOTAL: 288 24,702,593 $499,583
WEIGHTED AVERAGE 96.0% $20.22

--------
(1) Includes office and retail space but excludes storage.
(2) Includes spaces for leases that have been executed and have commenced as
of September 30, 2001.

S-24

(3) Total annualized base rent equals total original base rent, including
historical contractual increases and excluding (i) percentage rents, (ii)
additional rent payable/ /by tenants such as common area maintenance, real
estate taxes and other expense reimbursements, (iii) future contractual or
contingent rent escalations and (iv) parking rents.
(4) Calculated as total annualized base rent divided by net rentable area
leased.
(5) Includes tenants leasing 10% or more of rentable square footage (with the
percentage of rentable square footage in parentheses).
(6) We own the improvements on the property and have a leasehold interest in
the underlying land.
(7) We hold a general and limited partner interest in a partnership that owns
the property.
(8) We own 49% through a joint venture.
(9) We own 35% through a joint venture.
(10) We own 15% through a joint venture.
(11) We own 50% through a joint venture.
(12) We own 16% through a joint venture.

S-25

Current Development Activity

Estimated Total
Rentable Planned
% Start Square Number of Investment
Property Ownership Location Date Feet Buildings ($000s) (1)
-------- --------- -------------- ----- --------- --------- -----------

Wholly Owned
The Forum 100% Atlanta, GA 2000 90,000 1 $ 12,330
Dry Creek Corporate Center 100% Denver, CO 2001 93,773 1 11,777

Partially Owned
300 West Sixth Street 20% Austin, TX 2000 444,870 1 93,011
Nine Parkway North 35% Chicago, IL 2000 129,433 1 22,893
Custer Court 49% Dallas, TX 2000 120,047 1 15,858
Royal Ridge 35% Dallas, TX 2000 133,104 1 15,575
575 7th Street 30% Washington, DC 2001 473,000 1 164,079
799 9th Street 40% Washington, DC 2000 201,464 1 61,232
--------- - --------
Total 1,685,691 8 $396,755
========= = ========

--------
(1) Represents total planned investment by us, in the case of wholly owned
properties, and total planned investment by the joint venture, in the case
of partially owned properties. Our capital commitments with respect to our
joint ventures generally approximate our percentage ownership in the
venture.

Below are descriptions of the two most significant properties currently
under development:

300 West Sixth Street. This 444,870 square foot, 23 story building is
located in downtown Austin at 6/th/ Street and Guadelupe. CarrAmerica owns 20%
of the project in a joint venture with JER Partners. The building will open in
January 2002 and is approximately 50% pre-leased. Major tenants include Clark,
Thomas & Winters, P.C. and Akin, Gump, Strauss, Hauer & Feld, L.L.P.

575 7/th/ Street. Terrell Place is a 473,000 square foot building
consisting of 434,000 square feet of office space and 39,000 square feet of
retail space located in downtown Washington D.C. at the corner of 7/th/ and F
Street. CarrAmerica owns 30% of the project in a joint venture with JPMorgan
Fleming Asset Management. Construction began in August 2001 and completion is
scheduled for August 2003. The law firm of Venable, Baetjer, Howard &
Civiletti, LLP has pre-leased 243,791 square feet.

S-26

Tenant Information

50 Largest Tenants Based on Annualized Rent (Consolidated Properties)
as of September 30, 2001

% Of % Of
Portfolio Occupied
Annualized Square Square Industry
Tenant Rent Feet Feet Classification
------ ---------- --------- -------- ----------------------

1 International Monetary Fund............ 4.01% 504,401 2.52% Financial Services
2 Nokia, Inc............................. 3.03% 624,904 3.12% Telecommunications
3 Qwest.................................. 2.27% 532,506 2.66% Telecommunications
4 AT&T................................... 2.18% 658,940 3.29% Telecommunications
5 Applied Materials, Inc................. 2.14% 425,981 2.13% Manufacturing
6 Peoplesoft, Inc........................ 2.04% 359,686 1.80% Computer Software
7 Patton Boggs, L.L.P.................... 1.93% 187,653 0.94% Legal
8 Nextel Communications, Inc............. 1.60% 331,203 1.65% Telecommunications
9 Nortel Networks, Inc................... 1.51% 258,048 1.29% Telecommunications
10 Sun Microsystems, Inc.................. 1.46% 239,608 1.20% Computer Hardware
11 Citigroup.............................. 1.25% 227,135 1.13% Financial Services and
Insurance
12 Gateway, Inc........................... 1.20% 287,478 1.44% Computer Hardware
13 SBC Communications..................... 1.17% 202,093 1.01% Telecommunications
14 Lattice Semiconductor Corp............. 1.09% 216,650 1.08% Computer Hardware
15 Software AG of North America........... 1.04% 209,521 1.05% Computer Software
16 Safeco Insurance Company............... 0.99% 265,658 1.33% Insurance
17 Federal Deposit Insurance Corp......... 0.94% 121,878 0.61% Government Agency
18 Boston Scientific...................... 0.88% 212,082 1.06% Medical Devices
19 Unisys Corporation..................... 0.83% 197,404 0.99% Computer Software
20 King & Spalding........................ 0.82% 92,596 0.46% Legal
21 Washington Mutual...................... 0.79% 225,522 1.13% Financial Services
22 The Walt Disney Company................ 0.78% 129,347 0.65% Media
23 KPMG LLP............................... 0.77% 135,558 0.68% Financial Services
24 Harcourt, Inc.......................... 0.74% 195,230 0.97% Education Services
25 Chronicle of Higher Education.......... 0.71% 91,990 0.46% Associations
26 Stellcom, Inc.......................... 0.69% 97,054 0.48% Computer Consulting
27 Merrill Lynch, Pierce, Fenner and Smith 0.66% 77,443 0.39% Financial Services
28 Concert Management Corporation......... 0.65% 95,172 0.48% Telecommunications
29 KLA Instruments Corporation............ 0.65% 132,150 0.66% Computer Hardware
30 Tele-Communications, Inc............... 0.64% 157,294 0.79% Telecommunications
31 TSMC North America, Inc................ 0.64% 110,590 0.55% Computer Hardware
32 Corillian Corporation.................. 0.61% 122,127 0.61% Computer Software
33 Torrey Mesa Research Institute......... 0.61% 79,759 0.40% Biotech
34 Sharper Image Corporation.............. 0.58% 58,295 0.29% Retail
35 HQ Global Workplaces................... 0.54% 90,552 0.45% Real Estate Services
36 The Scripps Research Institute......... 0.54% 76,894 0.38% Biotech/Pharmaceutical
37 Toshiba American....................... 0.54% 82,452 0.41% Computer Hardware
38 Career Education Corporation........... 0.53% 84,725 0.42% Education Services
39 Texas Guaranteed Student Loan.......... 0.52% 130,664 0.65% Government Agency
40 Schlumberger Technologies, Inc......... 0.52% 175,250 0.88% Energy Services
41 AOL/Time Warner Communications......... 0.51% 130,000 0.65% Media
42 Art Institute of Atlanta, Inc.......... 0.50% 114,759 0.57% Education Services
43 El Camino Resources, Inc............... 0.50% 87,034 0.43% Insurance
44 Propel Software Corporation............ 0.50% 87,748 0.44% Computer Software
45 Broadwing Telecommunications........... 0.50% 128,716 0.64% Telecommunications
46 Fujitsu Microelectronics............... 0.47% 149,832 0.75% Computer Hardware
47 Ceridian Corporation................... 0.47% 113,568 0.57% Information Services
48 Netscape Communications Corp........... 0.46% 100,842 0.50% Computer Software
49 Caspian Networks....................... 0.46% 76,000 0.38% Computer Hardware
50 Redback Networks, Inc.................. 0.46% 94,874 0.47% Computer Hardware
------ --------- ------
Total.................................. 49.92% 9,586,866 47.89%
====== ========= ======

S-27

Lease Expiration Summary (Consolidated Properties) as of September 30, 2001

-------------------------------------
Current YTD Avg. Vacant
Region/Market Square Feet Occupancy(1) Occupancy(2) Square Feet 2001 2002 2003 2004
------------- ----------- ------------ ------------ ----------- ------- --------- --------- ---------

PACIFIC REGION
San Francisco Bay
Area............... 5,402,540 97.0% 98.8% 159,449 63,492 478,783 667,010 678,686
Orange County/Los
Angeles............ 1,813,732 94.0% 92.4% 109,214 35,186 236,248 207,372 292,046
Seattle............. 1,501,679 98.6% 99.4% 21,429 17,471 28,960 230,208 234,184
San Diego........... 1,069,709 96.3% 96.8% 39,823 47,455 26,400 138,762 100,287
Portland............ 275,193 90.8% 91.7% 25,365 -- -- -- 31,497

MOUNTAIN REGION
Denver.............. 815,788 98.4% 97.2% 12,813 23,671 120,455 94,365 44,430
Phoenix............. 532,506 100.0% 100.0% -- -- -- -- --
Salt Lake City...... 702,117 98.0% 98.2% 13,761 29,343 46,345 158,940 275,883

CENTRAL REGION
Chicago............. 1,225,162 91.9% 92.2% 99,337 40,953 264,149 313,062 175,621
Dallas.............. 1,611,951 97.2% 97.1% 45,211 27,190 148,024 288,831 142,744
Austin.............. 626,278 83.1% 93.9% 105,959 -- 14,964 34,330 257,342

EAST REGION
Washington, DC
Downtown
Properties........ 2,135,559 99.1% 99.5% 19,729 26,758 114,138 236,360 526,022
Suburban Properties 793,762 99.5% 99.5% 3,884 -- 39,922 27,339 88,548
Atlanta............. 1,771,109 90.0% 91.1% 176,812 108,230 447,924 301,582 173,343
---------- ------ ------ ------- ------- --------- --------- ---------
Total............ 20,277,085 95.9% 96.8% 832,786 419,749 1,966,312 2,698,161 3,020,633
========== ====== ====== ======= ======= ========= ========= =========

2011 &
Region/Market 2005 2006 2007 2008 2009 2010 Thereafter
------------- --------- --------- --------- --------- --------- ------- ----------

PACIFIC REGION
San Francisco Bay
Area............... 766,579 991,935 351,849 678,592 199,903 129,862 236,400
Orange County/Los
Angeles............ 231,416 270,899 158,673 228,420 -- 25,428 18,830
Seattle............. 467,058 101,413 -- -- 325,264 -- 75,692
San Diego........... 83,956 86,651 -- -- 84,949 97,054 364,372
Portland............ 51,797 -- 122,127 -- -- 44,407 --

MOUNTAIN REGION
Denver.............. 179,564 150,111 -- 190,379 -- -- --
Phoenix............. -- -- 532,506 -- -- -- --
Salt Lake City...... 12,389 87,456 78,000 -- -- -- --

CENTRAL REGION
Chicago............. 136,733 27,901 5,667 47,144 12,800 -- 101,795
Dallas.............. 81,585 42,530 33,426 131,479 440,872 223,470 6,589
Austin.............. 7,387 11,066 -- -- -- -- 195,230

EAST REGION
Washington, DC
Downtown
Properties........ 99,719 252,385 256,077 205,695 77,976 15,117 305,583
Suburban Properties 247,888 55,775 423 -- 327,788 2,195 --
Atlanta............. 84,567 37,825 87,306 -- 39,482 75,711 238,327
--------- --------- --------- --------- --------- ------- ---------
Total............ 2,450,638 2,115,947 1,626,054 1,481,709 1,509,034 613,244 1,542,818
========= ========= ========= ========= ========= ======= =========

--------
(1) Represents occupancy at September 30, 2001.
(2) Represents average occupancy for the nine months ended September 30, 2001.

S-28

Tenant Improvement Costs and Tenant Leasing Commissions

The following table sets forth per square foot tenant improvement costs and
tenant leasing commissions attributable to leases executed for the properties
consolidated in our financial statements during the periods presented.

Year ended December 31, 2000
---------------------------------------------------------------
Weighted
Total Avg. Lease Lease Tenant Total T/I's
Executed Term in Commissions Improvements and L/C's
Market Sq. Ft.(1) Years(2) Per Sq. Ft.(3) Per Sq. Ft.(4) Per Sq. Ft.(5)
------ ---------- ---------- -------------- -------------- --------------

Atlanta.................. 213,619 3.73 $2.64 $ 5.77 $ 8.41
Austin................... 33,165 4.01 2.27 4.99 7.26
Chicago.................. 137,484 3.48 3.69 14.07 17.76
Dallas................... 138,521 3.69 7.25 9.99 17.24
Denver................... 100,094 4.25 1.80 6.74 8.54
Los Angeles/Orange County 203,166 4.26 5.84 9.29 15.13
Phoenix.................. 55,401 3.44 3.82 5.71 9.53
Salt Lake City........... 42,693 4.48 2.64 10.15 12.79
San Diego................ 329,839 5.43 7.95 10.58 18.53
San Francisco Bay........ 866,878 4.26 4.42 4.13 8.55
Seattle.................. 150,175 6.27 5.94 9.00 14.94
Suburban Washington DC... 93,279 5.26 3.81 1.61 5.42
Downtown Washington DC... 186,686 5.85 3.69 3.65 7.34
---------
Total................. 2,551,000 4.29 4.79(6) 6.78(6) 11.57(6)
=========

Nine Months Ended September 30, 2001
---------------------------------------------------------------
Total Avg. Lease Lease Tenant Total T/I's
Executed Term in Commissions Improvements and L/C's
Market Sq. Ft.(1) Years(2) Per Sq. Ft.(3) Per Sq. Ft.(4) Per Sq. Ft.(5)
------ ---------- ---------- -------------- -------------- --------------

Atlanta.................. 269,882 4.14 $4.26 $11.67 $15.93
Austin................... 42,586 3.87 5.49 15.12 20.61
Chicago.................. 162,698 3.51 1.46 1.89 3.35
Dallas................... 86,962 3.10 3.86 6.56 10.42
Denver................... 65,031 5.16 2.94 8.79 11.73
Los Angeles/Orange County 347,734 4.37 3.58 10.25 13.83
Salt Lake City........... 79,049 2.40 0.37 2.00 2.37
San Diego................ 108,844 3.39 2.82 4.83 7.65
San Francisco Bay........ 346,385 3.57 2.22 0.93 3.15
Seattle.................. 194,469 3.83 0.86 4.05 4.91
Suburban Washington DC... 5,573 4.24 1.51 9.73 11.24
Downtown Washington DC... 5,953 3.00 -- -- --
---------
Total................. 1,715,166 3.85 2.72(6) 6.21(6) 8.93(6)
=========

--------
(1) Represents square footage for leases executed during the applicable period.
(2) Represents lease terms (in years) for leases executed during the applicable
period, weighted by square footage.
(3) Represents fees paid to brokers for leases executed during the applicable
period.
(4) Represents amounts paid to improve tenant space as a consideration for the
executed lease.
(5) Represents the sum of lease commissions and tenant improvements per square
foot.
(6) Represents the weighted average for the period presented.

S-29

Debt and Mortgage Financing

We have three investment grade ratings. As of September 30, 2001, Duff &
Phelps Credit Rating Co. and Standard & Poor's have each assigned their BBB
rating to our prospective senior unsecured debt offerings and their BBB- rating
to our prospective cumulative preferred stock offerings. Moody's Investor
Service has assigned its Baa2 rating to our prospective senior unsecured debt
offerings and its Baa3 rating to our prospective cumulative preferred stock
offerings.

Our total debt at September 30, 2001 was approximately $1.1 billion, of
which $114.0 million (10.3%) bore a LIBOR-based floating interest rate. The
interest rate on borrowings on our unsecured credit facility at September 30,
2001 was 3.3%. The interest rate of the unsecured credit facility is 70 basis
points over 30-day LIBOR. Our fixed rate mortgage payable debt bore an
effective weighted average interest rate of 8.04% at September 30, 2001. The
weighted average term of this mortgage debt is 6.5 years. At September 30,
2001, our debt represented 31.2% of our total market capitalization of $3.6
billion.

In June 2001, we closed on a new three-year, $500 million unsecured credit
facility with J.P. Morgan Chase, as agent for a group of banks. We can extend
the life of the line for an additional year at our option. The line carries an
interest rate of 70 basis points over 30-day LIBOR. The total commitment
carries a 20 basis point facility fee. The new credit facility has
substantially similar terms as our previous facility. As of December 1, 2001,
$427.0 million was drawn on the credit facility, $1.9 million in letters of
credit were outstanding and we had approximately $71.1 million available for
borrowing.

As of September 30, 2001, some of our consolidated operating properties
were subject to fixed rate mortgage indebtedness. The total of these mortgages
was $522.2 million. Our fixed rate mortgage debt as of September 30, 2001 bore
an effective weighted average interest rate of 8.04% and a weighted average
maturity of 6.5 years (assuming loans callable before maturity are called as
early as possible). The following table details information regarding the
existing mortgage indebtedness for the consolidated operating properties as of
September 30, 2001.

S-30

Mortgage Financing as of September 30, 2001

Principal Estimated
Interest Balance Maturity Annual Debt Balance Due at
Property Rate (000's) Date Service (000's) Maturity (000's)
-------- -------- --------- ---------- --------------- ----------------

Quorum North................................... 8.27% $ 6,271 12/10/2001(1) $ 160 $ 6,251
Valley Business Park II/First Street Technology
Center........................................ 8.25% 38,135 12/10/2001(2) 954 37,822
Sunnyvale Technology Center/Highland
Corporate Center/Hacienda West................ 8.90% 29,654 6/1/2002 4,010 27,562
Jaycor......................................... 7.35% 11,039 2/1/2003 1,520 10,050
Parkway North.................................. 6.92% 24,164 12/1/2003 1,672 24,164(3)
Canyon Park Commons............................ 9.13% 4,986 12/1/2004 714 4,043
Qwest Communications........................... 7.92% 17,447 12/1/2005 4,324 --
Qwest Communications........................... 7.92% 5,037 12/1/2005 1,376 --
Qwest Communications........................... 7.92% 7,555 12/1/2005 2,064 --
Qwest Communications........................... 7.92% 7,555 12/1/2005 2,064 --
Redmond East................................... 8.38% 26,254 1/1/2006 2,648 23,969(4)
Century Springs West/Glenridge/Midori/
Lakewood/Parkwood............................. 7.20% 18,906 1/1/2006 2,126 15,117(3)
Wateridge Pavilion............................. 8.25% 3,327 11/1/2006 338 2,926
Wasatch Corporate Center....................... 8.15% 12,080 1/2/2007 1,220 10,546
2600 West Olive................................ 6.75% 18,975 1/1/2009 1,524 19,875
Palomar Oaks................................... 8.85% 9,677 4/1/2009 1,025 7,896
1255 23rd St................................... 8.12% 38,101 4/1/2009 3,584 33,062
1730 Penn/International Square................. 8.12% 182,948 4/1/2009 17,190 158,950
South Coast.................................... 7.13% 14,927 6/10/2009 1,287 12,628
Sorenson....................................... 7.75% 2,253 7/1/2011 328 --
Sorenson....................................... 8.88% 1,536 5/1/2017 182 --
1747 Penn...................................... 9.50% 14,139 7/10/2017 1,730 -- (5)
900 19th St.................................... 8.25% 15,402 7/15/2019 1,656 --
1775 Penn...................................... 7.63% 11,766 9/1/2029 1,020 --
Techmart Commercial Ctr(6)..................... n/a 105 2/1/2003 n/a --
-------- -------
Total........................................ 8.04%(7) $522,239 $54,716
======== =======

--------
(1)We repaid this loan in full in November 2001.
(2)We expect to repay this loan in full at maturity. We also believe we can
extend the maturity date of this loan if we desire.
(3)Prepayable at the rates stated in the loan documents.
(4)Prepayable after 12/19/05 at the rates stated in the loan documents.
(5)Note is callable by the lender after 6/30/02. The estimated principal
balance will be $13,841,000 at that date.
(6)Capital lease.
(7)Weighted average interest rate.

S-31

MANAGEMENT

Directors, Executive Officers and Key Employees

The directors, executive officers and key employees of the Company and
their positions and offices are set forth in the following table:

Name Positions and Offices Held
---- --------------------------

Thomas A. Carr.......... Chairman of the Board, President, Chief
Executive Officer and Director

Oliver T. Carr, Jr...... Director

C. Ronald Blankenship(1) Director

Andrew F. Brimmer....... Director

A. James Clark.......... Director

Timothy Howard.......... Director

Caroline S. McBride(1).. Director

William D. Sanders(1)... Director

Wesley S. Williams, Jr.. Director

Philip L. Hawkins....... Chief Operating Officer

Richard F. Katchuk...... Chief Financial Officer

Karen B. Dorigan........ Chief Investment Officer

Kent C. Gregory......... Managing Director--National Services

Linda A. Madrid......... Managing Director, General Counsel and
Corporate Secretary

Paul R. Adkins.......... Managing Director

Steven N. Bralower...... Executive Vice President of Carr Real Estate
Services, Inc. and Senior Vice President of
Carr Realty, L.P.

Robert O. Carr.......... President of CarrAmerica Urban
Development, Inc. and Chairman of the Board
of Directors of Carr Real Estate Services, Inc.

Clete Casper............ Market Managing Director--Seattle

John J. Donovan, Jr..... Market Managing Director and President of
Carr Real Estate Services, Inc.

J. Thad Ellis........... Market Managing Director--Atlanta

Richard W. Greninger.... Managing Director--Property Operations

Dale F. Hogg............ Senior Vice President of Human Resources
and Administration

William Krokowski....... Market Managing Director--Denver

Thomas Levy............. Senior Vice President--Investments

Joel A. Manfredo........ Chief Technology Officer and Managing
Director of e-business solutions

Robert M. Milkovich..... Market Managing Director

S-32

Name Positions and Offices Held
---- --------------------------

Malcolm O'Donnell........ Vice President and Managing Director for
Southern California region

Gerald J. O'Malley....... Market Managing Director--Chicago

Jeffrey S. Pace.......... Market Managing Director--Austin

Stephen E. Riffee........ Senior Vice President, Controller & Treasurer

William H. Vanderstraaten Market Managing Director--Dallas

Stephen Walsh............ Senior Vice President of Capital Markets

Karen L. Widmayer........ Senior Vice President of Corporate
Communications

James S. Williams........ Managing Director and President of
CarrAmerica Development, Inc.

--------
(1) Messrs. Blankenship and Sanders and Ms. McBride were nominated to the board
as designees of Security Capital. Upon completion of this offering,
Security Capital will no longer have the contractual right to nominate any
members of our board.

S-33

UNDERWRITING

CarrAmerica, Security Capital and the underwriters for the offering named
below have entered into an underwriting agreement with respect to the shares
being offered. Subject to certain conditions, each underwriter has severally
agreed to purchase the number of shares indicated in the following table.
Goldman, Sachs & Co., Salomon Smith Barney Inc., First Union Securities, Inc.,
Legg Mason Wood Walker, Incorporated, Banc of America Securities LLC, Deutsche
Banc Alex. Brown Inc. and A.G. Edwards & Sons, Inc. are the representatives of
the underwriters.

Underwriters Number of Shares
------------ ----------------

Goldman, Sachs & Co........................................
Salomon Smith Barney Inc...................................
First Union Securities, Inc................................
Legg Mason Wood Walker, Incorporated.......................
Banc of America Securities LLC.............................
Deutsche Banc Alex. Brown Inc..............................
A.G. Edwards & Sons, Inc...................................
----------
Total................................................... 16,872,537
==========

The underwriters are committed to take and pay for all of the shares being
offered, if any are taken, other than the shares covered by the option
described below unless and until this option is exercised.

If the underwriters sell more shares than the total number set forth in the
table above, the underwriters have an option to buy up to an additional
2,530,880 shares from Security Capital to cover such sales. They may exercise
that option for 30 days. If any shares are purchased pursuant to this option,
the underwriters will severally purchase shares in approximately the same
proportion as set forth in the table above.

The following table shows the per share and total underwriting discounts
and commissions to be paid to the underwriters by Security Capital. Such
amounts are shown assuming both no exercise and full exercise of the
underwriters' option to purchase 2,530,880 additional shares.

Paid By Security Capital No Exercise Full Exercise
------------------------ ----------- -------------

Per Share.................................................. $ $
Total...................................................... $ $

Shares sold by the underwriters to the public will initially be offered at
the initial price to public set forth on the cover of this prospectus. Any
shares sold by the underwriters to securities dealers may be sold at a discount
of up to $ per share from the initial price to public. Any such securities
dealers may resell any shares purchased from the underwriters to certain other
brokers or dealers at a discount of up to $ per share from the initial price
to public. If all the shares are not sold at the initial price to public, the
representatives may change the offering price and the other selling terms.

CarrAmerica and Security Capital have agreed with the underwriters not to
sell or otherwise dispose of or hedge any of our common stock or securities
convertible into or exchangeable for shares of our common stock during the
period from the date of this prospectus continuing through the date 90 days
after the date of this prospectus, except with the prior written consent of
Goldman, Sachs & Co.

S-34

This agreement does not apply to any existing employee benefit plans or
conversion or redemption of any partnership units of any of our subsidiaries.

In connection with the offering, the underwriters may purchase and sell
shares of common stock in the open market. These transactions may include short
sales, stabilizing transactions and purchases to cover positions created by
short sales. Short sales involve the sale by the underwriters of a greater
number of shares than they are required to purchase in the offering. "Covered"
short sales are sales made in an amount not greater than the underwriters'
option to purchase additional shares from the selling shareholder in the
offering. The underwriters may close out any covered short position by either
exercising their option to purchase additional shares or purchasing shares in
the open market. In determining the source of shares to close out a covered
short position, the underwriters will consider, among other things, the price
of shares available for purchase in the open market as compared to the price at
which they may purchase shares through the overallotment option. "Naked" short
sales are any sales in excess of such option. The underwriters must close out
any naked short position by purchasing shares in the open market. A naked short
position is more likely to be created if the underwriters are concerned that
there may be downward pressure on the price of the common stock in the open
market after pricing that could adversely affect investors who purchase in the
offering. Stabilizing transactions consist of certain bids or purchases made
for the purpose of preventing or retarding a decline in the market price of the
common stock while the offering is in progress.

The underwriters also may impose a penalty bid. This occurs when a
particular underwriter repays to the underwriters a portion of the underwriting
discount received by it because the representatives have repurchased shares
sold by or for the account of such underwriter in stabilizing or short covering
transactions.

Purchases to cover a short position and stabilizing transactions may have
the effect of preventing or retarding a decline in the market price of the
common stock, and together with the imposition of the penalty bid, may
stabilize, maintain or otherwise affect the market price of the common stock.
As a result, the price of the common stock may be higher than the price that
otherwise might exist in the open market. If these activities are commenced,
they may be discontinued by the underwriters at any time. These transactions
may be effected on the NYSE, in the over-the-counter market or otherwise.

Our share of the total expenses of the offering will be approximately $ .
Security Capital estimates that its share of the total expenses of the
offering, excluding underwriting discounts and commissions, will be
approximately $ .

First Union Securities, Inc. is an indirect, wholly-owned subsidiary of
Wachovia Corporation, which conducts its investment banking, institutional and
capital markets businesses through its various bank, broker-dealer and nonbank
subsidiaries (including First Union Securities, Inc.) under the trade name of
Wachovia Securities. Any reference to Wachovia Securities in this prospectus,
however, does not include Wachovia Securities, Inc., member NASD/SIPC and a
separate broker-dealer subsidiary of Wachovia Corporation and sister affiliate
of First Union Securities, Inc. which may or may not be participating as a
selling dealer in the distribution of the common stock.

Some of the underwriters or their affiliates have provided investment and
commercial banking, investment research and financial advisory services to
CarrAmerica and Security Capital in the ordinary course of business for which
they have received and may continue to receive customary fees and commissions.
In addition, affiliates of certain of the underwriters, including Banc of
America Securities LLC, First Union Securities, Inc. and Salomon Smith Barney
Inc., are lenders under one of our credit facilities, and affiliates of certain
of the underwriters, including Banc of America Securities LLC, Deutsche Banc
Alex. Brown Inc., First Union Securities, Inc. and Salomon Smith Barney Inc.,
are lenders under one of Security Capital's credit facilities. In each case,
these underwriters have received customary fees for these transactions.

S-35

CarrAmerica and Security Capital have agreed to indemnify the several
underwriters against certain liabilities, including liabilities under the
Securities Act of 1933.

LEGAL MATTERS

The legality of the shares offered hereby and our qualification as a REIT
for federal income tax purposes have been passed upon for us by Hogan & Hartson
L.L.P. The legality of the shares offered hereby through this prospectus
supplement will be passed upon for the underwriters by Clifford Chance Rogers &
Wells LLP, New York, New York.

S-36

PROSPECTUS

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

19,403,417 Shares

CARRAMERICA REALTY CORPORATION

Common Stock

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

This prospectus relates to the public offering from time to time of up to
19,403,417 shares of our common stock by Security Capital Group Incorporated
and its affiliates (collectively "Security Capital"). As of November 14, 2001
Security Capital owned approximately 46.9% of our outstanding common stock. We
are registering these shares for offer and sale as required under the terms of
a registration rights agreement between Security Capital and us. Our
registration of the offered shares does not mean that Security Capital will
offer or sell any of the shares. We will receive no proceeds of any sales of
the offered shares by Security Capital.

Security Capital may sell shares to or through underwriters, and also to
other purchasers or through agents. Goldman, Sachs & Co. may be one of such
underwriters. The names of the underwriters will be set forth in the
accompanying prospectus supplement.

Our common stock is listed on the New York Stock Exchange and traded under
the symbol "CRE."

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

Neither the SEC nor any state securities commission has approved or
disapproved these securities or determined if this prospectus is truthful or
complete. Any representation to the contrary is a criminal offense.

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

The date of this prospectus is November 26, 2001

TABLE OF CONTENTS

Page
- ----

About the Company................................ 2
Risk Factors..................................... 2
About this Prospectus............................ 2
Where to Find More Information................... 3
Special Note Regarding Forward-Looking Statements 4
Use of Proceeds.................................. 5
Description of Common Stock...................... 5
The Selling Stockholder.......................... 7
Plan of Distribution............................. 9
Experts.......................................... 10
Legal Matters.................................... 10

--------------------------------------------------------------------------------
In this prospectus, "the Company," "we," "us," and "our" refer to
CarrAmerica Realty Corporation.

You should rely only on the information contained in this document or other
information that we incorporate by reference in deciding whether to invest in
the stock covered by this prospectus. We have not authorized anyone else to
provide you with different information. The stockholder selling shares of stock
with this prospectus may not make an offer to sell the shares covered by this
prospectus in any state where the offer is not permitted.

ABOUT THE COMPANY

We are a fully integrated, self-administered and self-managed publicly
traded real estate investment trust (REIT), and focus primarily on the
acquisition, development, ownership and operation of office properties located
primarily in selected markets across the United States. As of September 30,
2001, we owned, directly or through joint ventures, interests in a portfolio of
288 operating office properties.

Recent Development

On November 15, 2001, we agreed to repurchase from Security Capital
9,200,000 shares of our common stock, par value $.01 per share, at a price of
$28.85 per share. The aggregate purchase price of approximately $265.4 million
is payable in cash, which we intend to fund by drawing on our $500 million
unsecured credit facility with J.P. Morgan Chase, as agent for a group of
banks. As of September 30, 2001, we had $384.1 million available for borrowing
under the line. The purchase is expected to be consummated on November 19, 2001.

RISK FACTORS

See "Risk Factors" beginning on page 12 of our Annual Report on Form 10-K
for the year ended December 31, 2000 for a discussion of material risks
associated with an investment in our company.

ABOUT THIS PROSPECTUS

This prospectus is part of a registration statement on Form S-3 that we
filed with the SEC under the Securities Act of 1933, as amended. This
prospectus and any accompanying prospectus

supplement do not contain all of the information included in the registration
statement. For further information, we refer you to the registration statement,
including its exhibits. Statements contained in this prospectus and any
accompanying prospectus supplement about the provisions or contents of any
agreement or other document are not necessarily complete. If the SEC's rules
and regulations require that such agreement or document be filed as an exhibit
to the registration statement, please see such agreement or document for a
complete description of these matters. You should not assume that the
information in this prospectus or any prospectus supplement is accurate as of
any date other than the date on the front of each document.

This prospectus provides you with a general description of the offered
shares of common stock. Each time the selling stockholder sells any of these
offered shares, the selling stockholder will provide you with this prospectus
and a prospectus supplement, if applicable, that will contain specific
information about the terms of that sale. The prospectus supplement also may
add, update or change any information contained in this prospectus. You should
read both this prospectus and any prospectus supplement, together with
additional information described under the heading "Where to Find More
Information."

WHERE TO FIND MORE INFORMATION

We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any document we file with the
SEC at the SEC's public reference room at 450 Fifth Street, N.W., Washington,
D.C. Please call the SEC at 1-800-SEC-0330 for further information on the
public reference room. Our SEC filings also are available on the SEC's website
at http://www.sec.gov and through the CarrAmerica Realty Corporation website at
http://www.CarrAmerica.com.

The SEC allows us to "incorporate by reference" in this prospectus
information from other documents filed with the SEC, which means that we may
disclose important information in this prospectus by referring to those
documents. The information incorporated by reference is considered to be part
of this prospectus, and information that we file later with the SEC will
automatically update and supersede the information filed earlier. We
incorporate by reference the documents listed below and any future filings we
make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934 before the sale of all of the shares covered by this
prospectus:

. Our Annual Report on Form 10-K for the year ended December 31, 2000;

. Our Quarterly Reports on Form 10-Q for the quarters ended March 31, June
30, and September 30, 2001;

. Our Current Reports on Form 8-K filed with the SEC on February 2, May 4,
August 3, September 26, November 2, and November 16, 2001; and

. The description of the CarrAmerica Realty Corporation common stock
contained in our Registration Statement on Form 8-A, filed with the SEC
on February 3, 1993.

We will provide a copy of any of these filings (excluding exhibits) to each
person to whom a copy of this prospectus is delivered at no cost, upon written
or oral request to:

CarrAmerica Realty Corporation
1850 K Street, N.W., Suite 500
Washington, D.C. 20006
Attention: Corporate Secretary
Telephone: 202/729-7500

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements in this prospectus, and in the documents incorporated by
reference in this prospectus, constitute "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements involve known and unknown risks, uncertainties and
other factors that may cause our actual results, performance, achievements or
transactions or industry results to be materially different from any future
results, performance, achievements or transactions expressed or implied by such
forward-looking statements. Such factors include, among others, the following:

. National and local economic, business and real estate conditions
that will, among other things, affect:
. demand for office properties,
. the ability of the general economy to recover timely from the
current economic downturn,
. availability and creditworthiness of tenants,
. the level of lease rents, and
. the availability of financing for both our tenants and us;
. Adverse changes in the real estate markets including, among other
things:
. competition with other companies, and
. risks of real estate acquisition and development (including
the failure of pending acquisitions to close and pending
developments to be completed on time and within budget);
. Actions, strategies and performance of affiliates that we may not
control or companies in which we have made investments;
. Our ability to maintain our status as a REIT for federal income tax
purposes;
. Governmental actions and initiatives; and
. Environmental/safety requirements.

For a further discussion of these and other factors that could impact our
future results, performance, achievements or transactions, see the documents
filed by us from time to time with the SEC, and in particular the section
titled "Risk Factors" beginning on page 12 of our Annual Report on Form 10-K
for the year ended December 31, 2000.

USE OF PROCEEDS

We will not receive any proceeds from the sale of the stock covered by this
prospectus.

DESCRIPTION OF COMMON STOCK

General

We are authorized to issue 180,000,000 shares of common stock. The
outstanding common stock entitles the holder to one vote on all matters
presented to shareholders for a vote. Holders of common stock have no
preemptive rights. At November 14, 2001, there were 61,030,442 shares of common
stock outstanding.

Shares of common stock currently outstanding are listed for trading on the
New York Stock Exchange (the NYSE).

Subject to such preferential rights as may be granted by the Board of
Directors in connection with the future issuance of preferred stock, holders of
common stock are entitled to one vote per share on all matters to be voted on
by stockholders and are entitled to receive ratably such dividends as may be
declared on the common stock by the Board of Directors in its discretion from
funds legally available therefor. In the event of the liquidation, dissolution
or winding up of the Company, holders of common stock are entitled to share
ratably in all assets remaining after payment of all debts and other
liabilities and any liquidation preference of the holders of preferred stock.
Holders of common stock have no subscription, redemption, conversion or
preemptive rights. Matters submitted for stockholder approval generally require
a majority vote of the shares of common stock present and voting thereon.

Advance Notice of Director Nominations and New Business

The Bylaws of the Company provide that, with respect to an annual meeting of
stockholders, the proposal of business to be considered by stockholders may be
made only (i) by or at the direction of the Board of Directors or (ii) by a
stockholder who is entitled to vote at the meeting and who has complied with
the advance notice procedures set forth in the Bylaws. In addition, with
respect to any meeting of stockholders, nominations of persons for election to
the Board of Directors may be made only (i) by or at the direction of the Board
of Directors or (ii) by any stockholder who is entitled to vote at the meeting
and has complied with the advance notice provisions set forth in the Bylaws.

Restrictions on Transfer

Ownership Limits. Our Articles of Incorporation contain certain restrictions
on the number of shares of common stock that individual shareholders may own.
For us to qualify as a REIT under the Internal Revenue Code of 1986, as amended
(the "Code"), no more than 50% in value of our outstanding capital stock may be
owned, directly or indirectly, by five or fewer individuals (as defined in the
Code to include certain entities) during the last half of a taxable year (other
than the first REIT year) or during a proportionate part of a shorter taxable
year. The capital stock also must be beneficially owned by 100 or more persons
during at least 335 days of a taxable year or during a proportionate part of a
shorter taxable year. Because we intend to maintain our qualification as a
REIT, our Articles of Incorporation contain certain restrictions on the
ownership and transfer of capital stock, including common stock, intended to
ensure compliance with these requirements.

Subject to certain exceptions specified in the Articles of Incorporation, no
holder may own, through either actual ownership or deemed ownership by virtue
of certain attribution provisions of the Code,

more than (A) 5% of the issued and outstanding shares of common stock (the
"Common Stock Ownership Limit") or (B) 5% of any class or series of Preferred
Stock (the "Preferred Stock Ownership Limit"). (The Common Stock Ownership
Limit and the Preferred Stock Ownership Limit, together with the Existing
Holder Limit, the Special Shareholder Limit and the Non-U.S. Shareholder Limit,
each as defined below, are referred to collectively herein as the "Ownership
Limits.") Certain stockholders, including Clark Enterprises Inc., The Oliver
Carr Company, Oliver T. Carr, Jr. and A. James Clark, are not subject to the
Common Stock Ownership Limit, but they are subject to special ownership
limitations (the "Existing Holder Limit"). Furthermore, Security Capital and
its affiliates are not subject to the Common Stock Ownership Limit, but are
subject to a special ownership limit of 45% of the outstanding shares of common
stock and 45% of the outstanding shares of each class or series of preferred
stock (the "Special Shareholder Limit"). Security Capital's ownership interest
may be permitted to exceed 45% to the extent that such increase occurs as a
result of stock repurchases by us (as opposed to direct purchases by Security
Capital). Notwithstanding the Special Shareholder Limit, Security Capital has
entered into an agreement with the Company limiting Security Capital's
ownership interest to 37.44% (on a fully-diluted basis). Furthermore, all
holders are prohibited from acquiring any capital stock if such acquisition
would cause five or fewer beneficial owners of capital stock (determined taking
into account the relevant attribution provisions of the Code) who are treated
as "individuals" for purposes of relevant provisions of the Code to own in the
aggregate more than 50% in value of the outstanding capital stock.

In addition to the above restrictions on ownership of our shares of capital
stock, in order to assist us in qualifying as a "domestically controlled REIT,"
the Articles of Incorporation contain certain provisions preventing any
Non-U.S. Shareholder, as defined below, from acquiring additional shares of our
capital stock if, as a result of such acquisition, we would fail to qualify as
a "domestically controlled REIT" ("Non-U.S. Shareholder Limit"). A Non-U.S.
Shareholder is a nonresident alien individual, foreign corporation, foreign
partnership and any other foreign shareholder.

The Board of Directors may increase the Ownership Limits from time to time,
but may not do so to the extent that after giving effect to such increase five
or fewer beneficial owners of capital stock (determined taking into account the
relevant attribution provisions of the Code) who are treated as "individuals"
for purposes of relevant provisions of the Code could own in the aggregate more
than 49.5% in value of our outstanding capital stock. The Board of Directors,
in its sole discretion, may waive the Ownership Limits with respect to a holder
if such holder's ownership will not then or in the future jeopardize our status
as a REIT.

Violation of Ownership Limits. The Articles of Incorporation provide that,
if any holder of our capital stock purports to transfer shares to a person or
there is a change in our capital structure and either the transfer or the
change in capital structure would result in our failing to qualify as a REIT,
or such transfer or the change in capital structure would cause the transferee
to hold shares in excess of the applicable Ownership Limit, then the capital
stock being transferred (or in the case of an event other than a transfer, the
capital stock beneficially owned) that would cause one or more of the
restrictions on ownership or transfer to be violated will be automatically
transferred to a trust for the benefit of a designated charitable beneficiary.
The purported transferee of such shares will have no right to receive dividends
or other distributions with respect to such shares and will have no right to
vote such shares. Any dividends or other distributions paid to such purported
transferee prior to the discovery by us that the shares have been transferred
to a trust will be paid by the purported transferee upon demand to the trustee
of the trust for the benefit of the charitable beneficiary. The trustee of the
trust will have all rights to dividends with respect to the shares of capital
stock held in trust, which rights will be exercised for the exclusive benefit
of the charitable beneficiary. Any dividends or distributions paid over to the
trustee will be held in trust for the charitable beneficiary. The trustee will
designate a transferee of such stock so long as such shares of stock would not
violate the Ownership Limitations in the hands of such designated transferee.
Upon the sale of such shares, the purported transferee will receive the

lesser of (A) (i) the price per share such purported transferee paid for the
capital stock in the purported transfer that resulted in the transfer of shares
of capital stock to the trust, or (ii) if the transfer or other event that
resulted in the transfer of shares of capital stock to the trust was not a
transaction in which the purported record transferee of shares of capital stock
gave full value for such shares, a price per share equal to the market price on
the date of the purported transfer or other event that resulted in the transfer
of the shares to the trust, or (B) the price per share received by the trustee
from the sale or disposition of the shares held in the trust.

All certificates representing common stock will bear a legend referring to
the restrictions described above.

Every beneficial owner of more than 5% (or such lower percentage as required
by the Code or regulations thereunder) of the issued and outstanding shares of
common stock must file a written notice with us containing the information
specified in the Articles of Incorporation no later than December 31 of each
year. In addition, each shareholder upon demand is required to disclose to us
in writing such information as we may request in good faith in order to confirm
our status as a REIT.

Registrar and Transfer Agent

The Registrar and Transfer Agent for the common stock is EquiServe Trust
Company, N.A.

THE SELLING STOCKHOLDER

Security Capital, including its affiliates, permitted pledgees, transferees,
or other successors in interest, may from time to time offer and sell any or
all of the shares of common stock offered by this prospectus. The registration
of the shares offered hereby does not necessarily mean that Security Capital
will sell any or all of the shares.

As of November 14, 2001, Security Capital beneficially owned 28,603,417
shares of our common stock, representing approximately 46.9% of our outstanding
common stock at that time. On November 15, 2001, we agreed to repurchase from
Security Capital 9,200,000 shares of our common stock. After giving effect to
the repurchase, Security Capital will own 19,403,417 shares of our common
stock, or approximately 37.4% of our outstanding common stock. All of such
shares are available for resale under this prospectus. Since Security Capital
may sell all, some or none of the offered shares, no estimate can be made of
the number of offered shares that will be sold by Security Capital or that will
be owned by Security Capital upon completion of the offering.

Material Relationships with Security Capital

Set forth below are the material relationships between us and Security
Capital during the past three years:

Stockholders Agreement

In connection with the original investment by Security Capital U.S. Realty
in our company in 1996, we entered into a stockholders agreement with Security
Capital U.S. Realty pursuant to which we granted it certain rights relating to
our management and operations and its ownership interest in us. Security
Capital assumed these rights and obligations in January 2001 in connection with
a merger of Security Capital U.S. Realty with and into Security Capital. The
rights include:

(1)Board of Directors Representation. So long as Security Capital owns
at least 25% of the value of the outstanding shares of our common
stock on a fully-diluted basis, Security

Capital has the right to nominate for election to our Board of
Directors that number of directors so that the percentage of the
total number of directors that are Security Capital nominees
corresponds to the percentage of our common stock then owned by
Security Capital on a fully-diluted basis (but in no event more than
40% of the members of the Board of Directors). Currently William D.
Sanders, C. Ronald Blankenship and Caroline S. McBride serve on our
Board of Directors as designees of Security Capital. Security Capital
also has the right to have one of its designees serve on certain
committees of our Board of Directors.

(2)Information Rights. So long as Security Capital owns at least 25% of
the value of the outstanding shares of our common stock on a
fully-diluted basis, we have an obligation, among other things:

. to provide Security Capital with certain monthly reports and
financial statements and periodic securities filings,
. to comply with our reporting obligations under the Securities and
Exchange Act of 1934, as amended, and provide Security Capital
with the opportunity to review such filings, and
. to consult with a designee of Security Capital, prior to seeking
Board of Directors approval, in connection with proposals
relating to:

(a)acquisitions or business combinations valued in excess of
$25 million,
(b)sale or disposition of assets valued in excess of $25
million,
(c)the incurrence or issuance of indebtedness or guarantees
or other financing arrangements in excess of $25 million,
(d)our annual operating budget,
(e)material changes in our executive management,
(f)new material agreements with members of our executive
management, and
(g)certain equity issuances by us or any of our subsidiaries.

(3)Limitations on Corporate Actions--REIT Status. So long as Security
Capital owns at least 25% of the value of the outstanding shares of
our common stock on a fully-diluted basis and the standstill
provisions of the stockholders agreement (as described below) are
still in effect, we may not take certain actions, including actions
relating to our level of indebtedness or interests in businesses
other than the ownership of commercial office properties, or other
actions that could prevent us from being treated as a REIT for
federal income tax purposes.

(4)Participation Rights. So long as Security Capital owns at least 25%
of the value of the outstanding shares of our common stock on a
fully-diluted basis, if we or a subsidiary of ours with more than
$200 million in assets issues or sells shares of its capital stock or
partnership interests, as the case may be, Security Capital is
entitled to purchase or subscribe for up to 30% (or up to 35% in
order to retain an ownership percentage at least equal to 25%) of any
such issuance or sale.

(5)Standstill Provisions. The stockholders agreement contains certain
standstill provisions that expire on April 30, 2003, subject to
earlier termination in certain circumstances and subject to automatic
one-year extensions unless Security Capital provides 270 days written
notice prior to any such extension terminating the standstill
provisions. The provisions restrict Security Capital, or any group of
which it is a member, subject to certain exceptions, from acquiring
or disposing of our common stock or otherwise seeking to enter into a
business combination with, or disposition of, us or our assets.

(6)Noncompete. Security Capital has agreed that, so long as it owns at
least 25% of the value of the outstanding shares of our common stock
on a fully-diluted basis, it will not own, develop or otherwise
acquire office property in the United States other than through us,
subject to certain exceptions.

Registration Rights Agreement

We have also entered into a registration rights agreement with Security
Capital pursuant to which Security Capital has requested this registration of
all of its shares of common stock. The registration rights agreement generally
contains other terms customary to registration rights agreements of its type,
including indemnification provisions.

Stock Repurchase

On November 15, 2001, we agreed to repurchase from Security Capital
9,200,000 shares of our common stock, par value $.01 per share, at a price of
$28.85 per share. The aggregate purchase price of approximately $265.4 million
is payable in cash, which we intend to fund by drawing on our $500 million
unsecured credit facility with J.P. Morgan Chase, as agent for a group of
banks. The purchase is expected to be consummated on November 19, 2001. After
giving effect to the repurchase, Security Capital will own approximately 37.4%
of our outstanding common stock.

PLAN OF DISTRIBUTION

We will not receive any proceeds from the sale of common stock by Security
Capital. Security Capital may sell common stock directly or though
broker-dealers or underwriters who may act solely as agents, or who may acquire
shares as principals. Underwriters for an offering of common stock pursuant to
this prospectus may include Goldman, Sachs & Co.

Common stock may be sold from time to time by Security Capital or by its
permitted pledgees, transferees or other successors in interest to Security
Capital. The distribution of the common stock may be effected in one or more
transactions that may take place through the New York Stock Exchange, including
block trades or ordinary broker's transactions, or through broker-dealers
acting either as principal or agent, or through privately negotiated
transactions, or through an underwritten public offering, or through a
combination of any such methods of sale, at market prices prevailing at the
time of sale, at prices related to such prevailing market prices or at
negotiated prices for cash or other consideration. Usual and customary or
specifically negotiated brokerage fees or commissions may be paid by Security
Capital in connection with such sales. Additionally, Security Capital may issue
common stock upon conversion or exchange of convertible or exchangeable
securities issued by Security Capital or in satisfaction of options or short
sales of shares.

The aggregate proceeds to Security Capital from the sale of common stock
will be the purchase price of the common stock sold less the aggregate agents'
commissions and underwriters' discounts, if any, and other expenses of issuance
and distribution not borne by us. Security Capital and any dealers or agents
that participate in the distribution of the common stock may be deemed to be
"underwriters" within the meaning of the Securities Act, and any profit on the
sale of the common stock by them and any commissions received by any such
dealers or agents might be deemed to be underwriting discounts and commissions
under the Securities Act.

To the extent required, the specific number of shares of common stock to be
sold, the names of the selling shareholders, if other than Security Capital,
purchase price, public offering price, the terms upon which such securities may
be issued, the names of any agent, dealer or underwriter, and any

applicable commission or discount with respect to a particular offering will be
set forth in any accompanying prospectus supplement.

Pursuant to the registration rights agreement with Security Capital,
Security Capital is obligated to pay all costs and expenses incurred in
connection with the registration of the offered shares, including, without
limitation, all registration, filing and stock exchange or NASD fees, all fees
and expenses of complying with securities or blue sky laws, all printing
expenses, messenger and delivery expenses, any fees and disbursements of the
counsel retained by Security Capital, any fees and disbursements of
underwriters customarily paid by sellers of securities who are not issuers of
such securities and all underwriting discounts and commissions and transfer
taxes, if any, and any premiums and other costs of policies of insurance
obtained by Security Capital against liabilities arising out of the offering of
securities pursuant hereto. We will pay all fees and disbursements of counsel
and independent public accountants retained by us, incurred in connection with
the registration under the Securities Act of 1933, as amended, of the offering
made hereby and any premiums and other costs of insurance policies obtained by
us against liabilities arising out of the sale of securities. We have also
agreed to indemnify Security Capital against specified liabilities, including
certain potential liabilities arising under the Securities Act, or to
contribute to the payments Security Capital may be required to make in respect
thereof.

EXPERTS

Our consolidated financial statements and schedule as of December 31, 2000
and 1999, and for each of the years in the three-year period ended December 31,
2000, have been incorporated by reference herein and in the registration
statement in reliance upon the report of KPMG LLP, independent certified public
accountants, incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing.

With respect to the unaudited interim financial information for the periods
ended September 30, 2001 and 2000, June 30, 2001 and 2000 and March 31, 2001
and 2000 incorporated by reference herein, KPMG LLP has reported that they
applied limited procedures in accordance with professional standards for a
review of such information. However, their separate reports included in the
Company's quarterly reports on Form 10-Q for the quarters ended September 30,
2001, June 30, 2001 and March 31, 2001, and incorporated by reference herein,
state that they did not audit and they do not express an opinion on that
interim financial information. Accordingly, the degree of reliance on their
reports on such information should be restricted in light of the limited nature
of the review procedures applied. KPMG LLP is not subject to the liability
provisions of Section 11 of the Securities Act of 1933 for its reports on the
unaudited interim financial information because those reports are not "reports"
or a "part" of the registration statement prepared or certified by KPMG LLP
within the meaning of Sections 7 and 11 of the Act.

LEGAL MATTERS

The legality of the securities offered hereby and the qualification of
CarrAmerica Realty Corporation as a REIT for federal income tax purposes have
been passed upon for us by Hogan & Hartson L.L.P. If any portion of the offered
shares is distributed in an underwritten offering or through agents, certain
legal matters may be passed upon for any underwriters or agents by counsel for
such underwriters or agents identified in the applicable prospectus supplement.

[Map of Core Markets; Chart Depicting NOI by Core Market]

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No dealer, salesperson or other person is authorized to give any
information or to represent anything not contained in this prospectus. You must
not rely on any unauthorized information or representations. This prospectus is
an offer to sell only the shares offered hereby, but only under circumstances
and in jurisdictions where it is lawful to do so. The information contained in
this prospectus is current only as of its date.

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TABLE OF CONTENTS

Prospectus Supplement

Page
----

Prospectus Supplement Summary.. S-1
Risk Factors................... S-6
Use of Proceeds................ S-12
Capitalization................. S-12
Price Range of Common Stock and
Dividend History............. S-13
The Company.................... S-14
Properties..................... S-19
Management..................... S-32
Underwriting................... S-34
Legal Matters.................. S-36

Prospectus

About the Company..................... 2
Risk Factors.......................... 2
About this Prospectus................. 2
Where to Find More Information........ 3
Special Note Regarding Forward-Looking
Statements.......................... 4
Use of Proceeds....................... 5
Description of Common Stock........... 5
The Selling Stockholder............... 7
Plan of Distribution.................. 9
Experts............................... 10
Legal Matters......................... 10

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16,872,537 Shares

CarrAmerica Realty Corporation

Common Stock

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[LOGO] CARRAMERICA
AMERICA'S WORKPLACE

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Goldman, Sachs & Co.
Salomon Smith Barney
Legg Mason Wood Walker
Incorporated
Wachovia Securities
Banc of America Securities LLC
Deutsche Banc Alex. Brown
A.G. Edwards & Sons, Inc.

Representatives of the Underwriters

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