EXHIBIT 10.38 CONTRIBUTION AGREEMENT (MADISON PLACE) BY AND BETWEEN CARR CAPITAL REAL ESTATE INVESTMENTS, LLC A VIRGINIA LIMITED LIABILITY COMPANY, AS CONTRIBUTOR AND COLUMBIA EQUITY, LP, A VIRGINIA LIMITED PARTNERSHIP, AS ACQUIRER TABLE OF CONTENTS

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EXHIBIT 10.38

CONTRIBUTION AGREEMENT

(MADISON PLACE)

BY AND BETWEEN

CARR CAPITAL REAL ESTATE INVESTMENTS, LLC

A VIRGINIA LIMITED LIABILITY COMPANY,

AS CONTRIBUTOR

AND

COLUMBIA EQUITY, LP,

A VIRGINIA LIMITED PARTNERSHIP,

AS ACQUIRER

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TABLE OF CONTENTS

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ARTICLE I THE CONTRIBUTION............................................ 1

1.1 Contribution of Membership Interest................ 1

1.2 Consideration...................................... 1

1.3 Redemption Rights for Units........................ 2

1.4 Tax Consequences to Contributor.................... 2

ARTICLE II REPRESENTATIONS AND COVENANTS.............................. 2

2.1 Representations by Acquirer........................ 2

2.2 Representations by Contributor..................... 4

2.3 Covenants of Acquirer.............................. 6

2.4 Covenants of Contributor........................... 6

ARTICLE III Conditions Precedent to the Closing....................... 7

3.1 Conditions to Acquirer's Obligations............... 7

3.2 Conditions to Contributor's Obligations............ 8

ARTICLE IV Closing and Closing Documents.............................. 8

4.1 Closing............................................ 8

4.2 Contributor's Deliveries........................... 8

4.3 Acquirer's Deliveries.............................. 9

4.4 Fees and Expenses; Closing Costs................... 9

4.5 Adjustments........................................ 9

ARTICLE V Miscellaneous............................................... 10

5.1 Notices............................................ 10

5.2 Entire Agreement; Modifications and Waivers;

Cumulative Remedies................................ 10

5.3 Exhibits........................................... 11

5.4 Successors and Assigns............................. 11

5.5 Article Headings................................... 11

5.6 Governing Law...................................... 11

5.7 Counterparts....................................... 11

5.8 Survival........................................... 11

5.9 Severability....................................... 11

5.10 Attorneys' Fees.................................... 11

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EXHIBITS

A Assignment and Assumption Agreement

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CONTRIBUTION AGREEMENT

THIS CONTRIBUTION AGREEMENT (this "Agreement") is made as of this 31st day

of January, 2005 by and between Carr Capital Real Estate Investments, LLC, a

Virginia limited liability company ("Contributor"); and Columbia Equity, LP, a

Virginia limited partnership ("Acquirer").

RECITALS

A. Madison Place, LLC, a Virginia limited liability company (the "LLC") is

the owner of certain land located at 500 Montgomery Street in Alexandria,

Virginia (the "Land") and the office building and related improvements located

thereon (the "Improvements"), which Land and Improvements (collectively, the

"Property") are more commonly known as Madison Place.

B. Carr Capital Madison, LLC, a Virginia limited liability company ("Carr

Madison") is the record and beneficial owner of Fifteen percent (15%) of the

membership interests in the LLC.

C. Contributor is the record and beneficial owner of Twenty percent (20%)

of the membership interests in Carr Madison (the "Membership Interest").

D. Contributor desires to contribute the Membership Interest to Acquirer,

on the terms and conditions hereinafter set forth.

E. Acquirer desires to acquire the Membership Interest from Contributor,

on the terms and conditions hereinafter set forth.

AGREEMENT

NOW, THEREFORE, for and in consideration of the mutual covenants herein

contained, the parties hereto agree as follows:

ARTICLE I

THE CONTRIBUTION

1.1 Contribution of Membership Interest. Contributor agrees to contribute,

transfer, assign and convey the Membership Interest to Acquirer, and Acquirer

agrees to acquire and accept transfer of the Membership Interest pursuant to the

terms and conditions set forth in this Agreement. The Membership Interest shall

be transferred to Acquirer free and clear of all liens, encumbrances, security

interests, prior assignments or conveyances, conditions, restrictions, voting

agreements, claims, and any other matters affecting title thereto (other than

Carr Madison's operating agreement (the "Carr Madison Operating Agreement")).

1.2 Consideration. The total consideration (the "Consideration") for which

Contributor agrees to contribute and assign the Membership Interest to Acquirer,

and which Acquirer agrees to pay or deliver to Contributor, subject to the terms

of this Agreement, shall be

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the issuance to Contributor of a number of units of limited partnership

interests in Acquirer ("Units") equal to (a) Six Hundred Seventy-Four Four

Hundred Four Dollars ($674,404), (b) divided by the price per share at which the

common stock, $.01 par value per share, (the "Common Stock") of Columbia Equity

Trust, Inc., a Maryland corporation and the general partner of Acquirer (the

"REIT"), is offered to the public in the underwritten initial public offering of

the Common Stock (the "IPO"). On the Closing Date (as defined below), the Units

shall be issued to Contributor. Upon the request of Contributor, Acquirer shall

issue certificates reflecting Contributor's ownership of Units. The certificates

evidencing the Units will bear appropriate legends indicating (i) that the Units

have not been registered under the Securities Act of 1933, as amended

("Securities Act"), and (ii) that Acquirer's Amended and Restated Agreement of

Limited Partnership (the "Partnership Agreement") restricts the transfer of the

Units. Upon receipt of the Units and execution and delivery of the Partnership

Agreement, Contributor shall become a limited partner of Acquirer.

1.3 Redemption Rights for Units. Each Unit shall be redeemable, at the

option of the holder, in accordance with, but subject to the restrictions

contained in, the Partnership Agreement; provided, however, that such redemption

option may not be exercised prior to the first anniversary of the Closing Date.

1.4 Tax Consequences to Contributor. Notwithstanding anything to the

contrary contained in this Agreement, including without limitation the use of

words and phrases such as "sell," "sale," purchase," and "pay," the parties

hereto acknowledge and agree that it is their intent that the transaction

contemplated hereby be treated for federal income tax purposes as the

contribution of the Membership Interest by Contributor to Acquirer in exchange

for Units pursuant to Section 721 of the Internal Revenue Code of 1986, as

amended (the "Code"), and not as a transaction in which Contributor is acting

other than in its capacity as a prospective partner of Acquirer.

ARTICLE II

REPRESENTATIONS AND COVENANTS

2.1 Representations by Acquirer. Acquirer hereby represents and warrants

unto Contributor that the following statements are true, correct, and complete

in every material respect as of the date of this Agreement and will be true,

correct, and complete as of the Closing Date:

(a) Organization and Power. Acquirer is duly organized and validly

existing, under the laws of the Commonwealth of Virginia, and has full right,

power, and authority to enter into this Agreement and to perform all of its

obligations under this Agreement; and, the execution and delivery of this

Agreement and the performance by Acquirer of its obligations under this

Agreement have been duly authorized by all requisite action of Acquirer and

require no further action or approval of Acquirer's partners or of any other

individuals or entities in order to constitute this Agreement as a binding and

enforceable obligation of Acquirer.

(b) Noncontravention. Neither the entry into nor the performance of,

or compliance with, this Agreement by Acquirer has resulted, or will result, in

any violation of, or default under, or result in the acceleration of, any

obligation under the Partnership Agreement, or

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any mortgage, indenture, lien agreement, note, contract, permit, judgment,

decree, order, restrictive covenant, statute, rule, or regulation applicable to

Acquirer.

(c) Litigation. There is no action, suit, or proceeding, pending or

known to be threatened, against or affecting Acquirer in any court or before any

arbitrator or before any federal, state, municipal, or other governmental

department, commission, board, bureau, agency or instrumentality which (i) in

any manner raises any question affecting the validity or enforceability of this

Agreement, (ii) would reasonably be expected to materially and adversely affect

the business, financial position, or results of operations of Acquirer, or (iii)

would reasonably be expected to materially and adversely affect the ability of

Acquirer to perform its obligations hereunder, or under any document to be

delivered pursuant hereto.

(d) Units Validly Issued. The Units, when issued, will have been

duly and validly authorized and issued, free of any preemptive or similar

rights, and will be fully paid and nonassessable, without any obligation to

restore capital except as required by the Virginia Revised Uniform Limited

Partnership Act (the "Limited Partnership Act"). Upon execution and delivery of

the Partnership Agreement by Contributor, Contributor shall be admitted as a

limited partner of Acquirer as of the Closing Date and shall be entitled to all

of the rights and protections of a limited partner under the Limited Partnership

Act and the provisions of the Partnership Agreement, with the same rights,

preferences, and privileges as all other limited partners on a pari passu basis.

(e) Consents. Each consent, approval, authorization, order, license,

certificate, permit, registration, designation, or filing by or with any

governmental agency or body necessary for the execution, delivery, and

performance of this Agreement or the transactions contemplated hereby by

Acquirer has been obtained.

(f) Bankruptcy with respect to Acquirer. No Act of Bankruptcy has

occurred with respect to Acquirer. As used herein, "Act of Bankruptcy" shall

mean if a party hereto shall (A) apply for or consent to the appointment of, or

the taking of possession by, a receiver, custodian, trustee or liquidator of

itself or of all or a substantial part of its property, (B) admit in writing its

inability to pay its debts as they become due, (C) make a general assignment for

the benefit of its creditors, (D) file a voluntary petition or commence a

voluntary case or proceeding under the Federal Bankruptcy Code (as now or

hereafter in effect), (E) be adjudicated bankrupt or insolvent, (F) file a

petition seeking to take advantage of any other law relating to bankruptcy,

insolvency, reorganization, winding-up or composition or adjustment of debts,

(G) fail to controvert in a timely and appropriate manner, or acquiesce in

writing to, any petition filed against it in an involuntary case or proceeding

under the Federal Bankruptcy Code (as now or hereafter in effect), or (H) take

any action for the purpose of effecting any of the foregoing.

(g) Brokerage Commission. Acquirer has not engaged the services of,

nor has it or will it or Contributor become liable to, any real estate agent,

broker, finder or any other person or entity for any brokerage or finder's fee,

commission or other amount with respect to the transactions described herein on

account of any action by Acquirer. Acquirer hereby agrees to indemnify and hold

Contributor and its employees, directors, members, partners, affiliates and

agents harmless against any claims, liabilities, damages or expenses arising out

of a breach of the foregoing. This indemnification shall survive Closing or any

termination of this Agreement.

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2.2 Representations by Contributor. Contributor hereby represents and

warrants unto Acquirer that each and every one of the following statements is

true, correct, and complete in every material respect as of the date of this

Agreement and will be true, correct, and complete as of the Closing Date:

(a) Organization and Power. Contributor is duly organized, validly

existing, and in good standing as a limited liability company under the laws of

the Commonwealth of Virginia. Contributor has full right, power, and authority

to enter into this Agreement and to assume and perform all of its obligations

under this Agreement; and the execution and delivery of this Agreement and the

performance by Contributor of its obligations hereunder have been duly

authorized by all requisite action of Contributor and require no further action

or approval of Contributor's members or managers or of any other individuals or

entities in order to constitute this Agreement as a binding and enforceable

obligation of Contributor.

(b) Noncontravention. Neither the entry into nor the performance of,

or compliance with, this Agreement by Contributor has resulted, or will result,

in any violation of, or default under, or result in the acceleration of, any

obligation under any limited liability company agreement, operating agreement,

regulation, mortgage, indenture, lien agreement, note, contract, permit,

judgment, decree, order, restrictive covenant, statute, rule, or regulation

applicable to Contributor or to the Membership Interest.

(c) Litigation. There is no action, suit, claim, or proceeding

pending or threatened against or affecting Contributor or the Membership

Interest in any court, or before any arbitrator, or before any federal, state,

municipal or other governmental department, commission, board, bureau, agency or

instrumentality which (A) in any manner raises any question affecting the

validity or enforceability of this Agreement, (B) would reasonably be expected

to materially and adversely affect the business, financial position or results

of operations of Contributor, (C) would reasonably be expected to materially and

adversely affect the ability of Contributor to perform its obligations

hereunder, or under any document to be delivered pursuant hereto, (D) would

reasonably be expected to create a lien on the Membership Interest, any part

thereof, or any interest therein, or (E) would reasonably be expected to

adversely affect the Membership Interest, any part thereof, or any interest

therein.

(d) Good Title. (A) Contributor has good title to the Membership

Interest on the date hereof and will have good title to the Membership Interest

on the Closing Date (other than the Carr Madison Operating Agreement), (B) the

Membership Interest on the date hereof is and on the Closing Date will be free

and clear of all liens, encumbrances, pledges, voting agreements and security

interests whatsoever (other than the Carr Madison Operating Agreement), and (C)

Contributor has not granted any other person or entity an option to purchase or

a right of first refusal upon the Membership Interest nor are there any

agreements or understandings between Contributor and any other person or entity

with respect to the disposition of the Membership Interest (other than the Carr

Madison Operating Agreement).

(e) No Consents. Each consent, approval, authorization, order,

license, certificate, permit, registration, designation, or filing by or with,

any governmental agency or body necessary of the execution, delivery, and

performance of this Agreement or the transactions

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