<SUBMISSION>
<ACCESSION-NUMBER>0000950133-04-003068
<TYPE>10-Q
<PUBLIC-DOCUMENT-COUNT>6
<PERIOD>20040630
<FILING-DATE>20040806
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>AVALONBAY COMMUNITIES INC
<CIK>0000915912
<ASSIGNED-SIC>6798
<IRS-NUMBER>770404318
<STATE-OF-INCORPORATION>MD
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>10-Q
<ACT>34
<FILE-NUMBER>001-12672
<FILM-NUMBER>04957303
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>2900 EISENHOWER AVENUE
<STREET2>SUITE 300
<CITY>ALEXANDRIA
<STATE>VA
<ZIP>22314
<PHONE>7033296300
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>2900 EISENHOWER AVENUE
<STREET2>STE 300
<CITY>ALEXANDRIA
<STATE>VA
<ZIP>22314
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>AVALON BAY COMMUNITIES INC
<DATE-CHANGED>19980618
</FORMER-COMPANY>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>BAY APARTMENT COMMUNITIES INC
<DATE-CHANGED>19931208
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>w99702e10vq.htm
<DESCRIPTION>FORM 10-Q
<TEXT>
<HTML>
<HEAD>
<TITLE>e10vq</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
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<DIV style="font-family: 'Times New Roman',Times,serif">



<HR size="1" noshade color="#000000" style="margin-top: -10px">








<P align="center" style="font-size: 10pt">UNITED STATES<BR>
SECURITIES AND EXCHANGE COMMISSION



<P align="center" style="font-size: 10pt">Washington, D.C. 20549



<P align="center" style="font-size: 10pt">FORM 10-Q



<P align="center" style="font-size: 10pt">QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)<BR>
OF THE SECURITIES EXCHANGE ACT OF 1934



<P align="center" style="font-size: 10pt">For the quarterly period ended June&nbsp;30, 2004



<P align="center" style="font-size: 10pt">Commission file number 1-12672



<P align="center" style="font-size: 10pt">AVALONBAY COMMUNITIES, INC.<BR>
<I>(Exact name of registrant as specified in its charter)</I>



<P>
<HR noshade width="20%" align="center" size="1">
<P>



<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="75%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD nowrap align="left">Maryland</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="left"><B>&nbsp;</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">77-0404318</TD>
</TR>

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<TR valign="bottom">
    <TD align="left" valign="top"><I>(State or other jurisdiction of<BR>
incorporation or organization)</I>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><I>&nbsp;<BR>
&nbsp;</I>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><I>(I.R.S. Employer<BR>
Identification No.)</I></TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>



<P align="center" style="font-size: 10pt">2900 Eisenhower Avenue, Suite&nbsp;300<BR>
Alexandria, Virginia 22314<BR>
<I>(Address of principal executive offices, including zip code)</I>



<P align="center" style="font-size: 10pt">(703)&nbsp;329-6300<BR>
<I>(Registrant&#146;s telephone number, including area code)</I>



<P align="center" style="font-size: 10pt"><I>(Former name, if changed since last report)</I>



<P>
<HR noshade width="20%" align="center" size="1">
<P>



<P align="left" style="font-size: 10pt">Indicate by check mark whether the registrant (1)&nbsp;has filed all reports
required to be filed by Section&nbsp;13 or 15(d) of the Securities Exchange Act of
1934 during the preceding twelve (12)&nbsp;months (or for such shorter period that
the registrant was required to file such reports), and (2)&nbsp;has been subject to
such filing requirements for the past ninety (90)&nbsp;days.



<P align="center" style="font-size: 10pt">Yes&nbsp;&nbsp;&nbsp;<FONT face="Wingdings">&#253;</FONT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No&nbsp;&nbsp;&nbsp;<FONT face="Wingdings">&#168;</FONT>


<P align="left" style="font-size: 10pt">Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule&nbsp;12b-2 of the Act).



<P align="center" style="font-size: 10pt">Yes&nbsp;&nbsp;&nbsp;<FONT face="Wingdings">&#253;</FONT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No&nbsp;&nbsp;&nbsp;<FONT face="Wingdings">&#168;</FONT>

<P align="center" style="font-size: 10pt"><U>APPLICABLE ONLY TO CORPORATE ISSUERS</U>


<P align="left" style="font-size: 10pt">Indicate the number of shares outstanding of each of the issuer&#146;s classes of
common stock as of the latest practicable date:


<P align="left" style="font-size: 10pt">71,951,226 shares of common stock, par value $0.01 per share, were outstanding
as of July&nbsp;30, 2004



<P>
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<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">




<P align="center" style="font-size: 10pt"><B>AVALONBAY COMMUNITIES, INC.<BR>
FORM 10-Q<BR>
INDEX</B>



<P align="center" style="font-size: 10pt"><B>PART I &#151; FINANCIAL INFORMATION</B>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="9%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="13%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B><U>Page</U></B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;1.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">Condensed Consolidated Financial Statements
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">Condensed Consolidated Balance Sheets as of June&nbsp;30, 2004 (unaudited)&nbsp;and
December&nbsp;31, 2003
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD nowrap valign="bottom">1</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">Condensed
Consolidated Statements of Operations and Other Comprehensive
Income<BR>
(unaudited)&nbsp;for the three and six months ended June&nbsp;30, 2004 and 2003
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="left" nowrap valign="bottom">2</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">Condensed Consolidated Statements of Cash Flows (unaudited)&nbsp;for the six months<BR>
ended June&nbsp;30, 2004 and 2003
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="left" nowrap valign="bottom">3-4</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">Notes to Condensed Consolidated Financial Statements (unaudited)
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="left" nowrap valign="bottom">5-20</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;2.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">Management&#146;s Discussion and Analysis of Financial Condition and Results of
Operations
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="left" nowrap valign="bottom">21-48</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;3.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">Quantitative and Qualitative Disclosures About Market Risk
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="left" nowrap valign="bottom">49</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;4.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">Controls and Procedures
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="left" nowrap valign="bottom">49</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="center" valign="top"><B>PART II &#151; OTHER INFORMATION</B>
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;1.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">Legal Proceedings
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="left" nowrap valign="bottom">49</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;2.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">Changes in Securities, Use of Proceeds and Issuer Purchases of Equity
Securities
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="left" nowrap valign="bottom">50</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;3.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">Defaults Upon Senior Securities
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="left" nowrap valign="bottom">50</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;4.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">Submission of Matters to a Vote of Security Holders
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="left" nowrap valign="bottom">50</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;5.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">Other Information
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="left" nowrap valign="bottom">51</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Item&nbsp;6.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="left" valign="top">Exhibits and Reports on Form&nbsp;8-K
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="left" nowrap valign="bottom">51-52</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Signatures
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top"></TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="left" nowrap valign="bottom">53</TD>
</TR>

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</TABLE>
</DIV>



<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<P align="center" style="font-size: 10pt">AVALONBAY COMMUNITIES, INC.<BR>
CONDENSED CONSOLIDATED BALANCE SHEETS<BR>
(Dollars in thousands, except per share data)


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="95%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="78%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>6-30-04</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>12-31-03</B><HR size="1" noshade></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" colspan="3"><B>(unaudited)</B></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">ASSETS</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Real estate:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>


<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Land, including land held for development</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">962,480</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">903,906</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Buildings and improvements</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,229,925</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,040,828</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Furniture, fixtures and equipment</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">130,141</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">124,302</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,322,546</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,069,036</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Less accumulated depreciation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(775,893</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(684,021</TD>
    <TD nowrap>)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Net operating real estate</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,546,653</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,385,015</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Construction in progress (including land)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">248,516</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">253,158</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Real estate assets held for sale, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">51,017</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">98,216</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Total real estate, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,846,186</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,736,389</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Cash and cash equivalents</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,501</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,165</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Cash in escrow</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,268</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11,825</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Resident security deposits</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">24,359</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">20,891</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Investments in unconsolidated real estate entities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">25,379</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">19,735</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Deferred financing costs, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">23,172</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,362</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Deferred development costs</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33,973</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">31,334</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Participating mortgage note</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,483</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Prepaid expenses and other assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">37,065</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">43,398</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Total assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">5,004,903</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">4,909,582</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">LIABILITIES AND STOCKHOLDERS&#146; EQUITY</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1,859,436</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1,835,284</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Variable rate unsecured credit facility</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">128,900</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">51,100</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Mortgage notes payable</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">451,800</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">422,278</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Dividends payable</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">52,491</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">51,831</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Payables for construction</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">26,547</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">26,912</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Accrued expenses and other liabilities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">87,040</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">85,089</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Accrued interest payable</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">37,040</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">38,883</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Resident security deposits</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">36,238</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">31,880</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Liabilities related to real estate assets held for sale</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">613</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">30,239</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Total liabilities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,680,105</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,573,496</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Minority interest of unitholders in consolidated partnerships</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">23,669</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">24,752</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Commitments and contingencies</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Stockholders&#146; equity:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Preferred stock, $0.01 par value; $25 liquidation preference; 50,000,000 shares
authorized
at both June&nbsp;30, 2004 and December&nbsp;31, 2003; 4,000,000 shares issued
and outstanding at both June&nbsp;30, 2004 and December&nbsp;31, 2003, respectively</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">40</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">40</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Common stock, $0.01 par value; 140,000,000 shares authorized at both June&nbsp;30, 2004
and December&nbsp;31, 2003; 71,879,228 and 70,937,526 shares issued and outstanding
at
June&nbsp;30, 2004 and December&nbsp;31, 2003, respectively</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">719</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">709</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Additional paid-in capital</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,361,895</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,322,581</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Deferred compensation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(11,233</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(5,808</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Dividends less than (in excess of) accumulated earnings</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(43,015</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,024</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Accumulated other comprehensive loss</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(7,277</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(8,212</TD>
    <TD nowrap>)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Total stockholders&#146; equity</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,301,129</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,311,334</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>


<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Total liabilities and stockholders&#146; equity</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">5,004,903</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">4,909,582</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">See accompanying notes to Condensed Consolidated Financial Statements.

<P align="center" style="font-size: 10pt">1
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<P align="center" style="font-size: 10pt">AVALONBAY COMMUNITIES, INC.<BR>
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS<BR>
AND OTHER COMPREHENSIVE INCOME<BR>
(Unaudited)<BR>
(Dollars in thousands, except per share data)


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="95%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="60%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7"><B>For the three months ended</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7"><B>For the six months ended</B><HR size="1" noshade></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>6-30-04</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>6-30-03</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>6-30-04</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>6-30-03</B><HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Revenue:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Rental and other income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">162,101</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">149,101</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">318,832</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">296,840</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Management, development and other fees</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">157</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">247</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">305</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">511</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Total revenue</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">162,258</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">149,348</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">319,137</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">297,351</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Expenses:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Operating expenses, excluding property taxes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">47,966</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">42,551</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">93,924</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">84,606</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Property taxes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">15,055</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">13,961</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">30,629</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">28,141</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Interest expense</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">32,482</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">34,067</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">64,768</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">68,041</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Depreciation expense</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">40,173</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">37,053</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">79,745</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">73,723</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:20px; text-indent:-10px">General and administrative expense</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,071</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,623</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,041</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,254</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Total expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">139,747</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">131,255</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">277,107</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">261,765</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Equity in income of unconsolidated entities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">276</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">677</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">463</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,205</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Interest income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">36</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">880</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">56</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,782</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Venture partner interest in profit-sharing</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(352</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(470</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(677</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(848</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Minority interest in consolidated partnerships</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(420</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(234</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(275</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(454</TD>
    <TD nowrap>)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Income from continuing operations before
cumulative effect of change in accounting principle</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">22,051</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,946</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">41,597</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">37,271</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Discontinued operations:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Income from discontinued operations</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">608</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,011</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,792</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,002</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Gain on sale of communities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,375</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">54,511</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,375</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">68,583</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Total discontinued operations</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,983</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">57,522</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">14,167</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">76,585</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Income before cumulative effect of
change in accounting principle</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">35,034</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">76,468</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">55,764</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">113,856</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Cumulative effect of change in accounting principle</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,547</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Net income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">35,034</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">76,468</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">60,311</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">113,856</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Dividends attributable to preferred stock</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2,175</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2,706</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(4,350</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(6,394</TD>
    <TD nowrap>)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Net income available to common stockholders</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">32,859</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">73,762</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">55,961</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">107,462</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Other comprehensive income (loss):</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Unrealized gain (loss)&nbsp;on cash flow hedges</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,307</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(258</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">935</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">491</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Comprehensive income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">34,166</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">73,504</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">56,896</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">107,953</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Dividends declared per common share</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.70</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.70</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.40</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.40</TD>
    <TD>&nbsp;</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Earnings per common share &#151; basic:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Income from continuing operations
(net of dividends attributable to preferred stock)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.28</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.24</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.59</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.45</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Discontinued operations</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.18</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.86</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.20</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1.14</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Net income available to common stockholders</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.46</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.10</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.79</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.59</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Earnings per common share &#151; diluted:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Income from continuing operations
(net of dividends attributable to preferred stock)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.28</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.24</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.60</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.45</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Discontinued operations</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.18</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.84</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">0.19</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1.12</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Net income available to common stockholders</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.46</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.08</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.79</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.57</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">See accompanying notes to Condensed Consolidated Financial Statements.


<P align="center" style="font-size: 10pt">2
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="center" style="font-size: 10pt">AVALONBAY COMMUNITIES, INC.<BR>
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS<BR>
(Unaudited)<BR>
(Dollars in thousands)


<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="95%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="74%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7"><B>For the six months ended</B><HR size="1" noshade></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>6-30-04</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>6-30-03</B><HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Cash flows from operating activities:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Net income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">60,311</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">113,856</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Adjustments to reconcile net income to cash provided</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:50px; text-indent:-10px">by operating activities:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Depreciation expense</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">79,745</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">73,723</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Depreciation expense from discontinued operations</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">125</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,738</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Amortization of deferred financing costs and debt premium/discount</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,094</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,952</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Amortization of deferred compensation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,324</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,784</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Income allocated to minority interest in consolidated partnerships
including discontinued operations</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">275</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">843</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Income allocated to venture partner interest in profit-sharing</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">677</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">848</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Gain on sale of communities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(12,375</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(68,583</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Cumulative effect of change in accounting principle</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(4,547</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Increase in cash in operating escrows</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(1,338</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(709</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Decrease in resident security deposits, prepaid
expenses and other assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,666</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,966</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Increase (decrease)&nbsp;in accrued expenses, other liabilities
and accrued interest payable</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,952</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(5,737</TD>
    <TD nowrap>)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Net cash provided by operating activities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">135,909</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">129,681</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Cash flows from investing activities:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Development/redevelopment of real estate assets including
land acquisitions and deferred development costs</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(173,918</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(196,654</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Acquisition of real estate assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(24,065</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Capital expenditures &#151; existing real estate assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(6,127</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(5,365</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Capital expenditures &#151; non-real estate assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(366</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(84</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Proceeds from sale of communities and land, net of selling costs</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">40,909</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">202,845</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Decrease in payables for construction</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(365</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2,247</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Decrease (increase)&nbsp;in cash in construction escrows</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">895</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(19,255</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Decrease in investments in unconsolidated real estate entities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">613</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">878</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Net cash used in investing activities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(162,424</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(19,882</TD>
    <TD nowrap>)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Cash flows from financing activities:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Issuance of common stock</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">28,598</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,621</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Repurchase of common stock</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(39,877</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Issuance of preferred stock, net of related costs</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">81,737</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Redemption of preferred stock and related costs</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(163,724</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Dividends paid</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(104,033</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(101,296</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Net borrowings under unsecured credit facility</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">77,800</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">129,230</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Issuance of mortgage notes payable</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">42,800</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">38,829</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Repayments of mortgage notes payable</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(37,000</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2,140</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Issuance (repayment)&nbsp;of unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">25,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(50,000</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Payment of deferred financing costs</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(8,752</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(1,195</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Redemption of units for cash by minority partners</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(163</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Distributions to DownREIT partnership unitholders</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(741</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(1,237</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Distributions to joint venture and profit-sharing partners</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(1,658</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2,213</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Net cash provided by (used in) financing activities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,851</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(101,265</TD>
    <TD nowrap>)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Net increase (decrease)&nbsp;in cash and cash equivalents</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(4,664</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,534</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Cash and cash equivalents, beginning of period</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,165</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,933</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Cash and cash equivalents, end of period</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">2,501</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">21,467</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Cash paid during period for interest, net of amount capitalized</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">62,579</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">65,879</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>




<P align="center" style="font-size: 10pt">
</DIV>


<P align="center" style="font-size: 10pt">See accompanying notes to Condensed Consolidated Financial Statements.



<P align="center" style="font-size: 10pt">3
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">




<P align="center" style="font-size: 10pt">CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)


<P align="left" style="font-size: 10pt">Supplemental disclosures of non-cash investing and financing activities
(dollars in thousands):


<P align="left" style="font-size: 10pt">During the six months ended June&nbsp;30, 2004:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD>As described in Note 4, &#147;Stockholders&#146; Equity,&#148; 147,517 shares of
common stock were issued in connection with stock grants, 35,215 shares
were issued in connection with non-cash stock option exercises, 49,583
shares were withheld to satisfy employees&#146; tax withholding and other
liabilities and 72 shares were forfeited, for a net value of $6,170.</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD>49,391 units of limited partnership, valued at $1,852, were
presented for redemption to the DownREIT partnerships that issued such
units and were acquired by the Company in exchange for an equal number
of shares of the Company&#146;s common stock.</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD>The Company sold one community with a mortgage note payable of
$18,755 that was assumed by the buyer as part of the total sales price.</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD>The Company assumed fixed rate debt of $13,322 in connection with
the acquisition of two improved land parcels.</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD>The Company recorded a decrease to other liabilities and a
corresponding gain to other comprehensive income of $935 to adjust the
Company&#146;s Hedged Derivatives (as defined in Note 5, &#147;Derivative
Instruments and Hedging Activities&#148;) to their fair value.</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD>Common and preferred dividends declared but not paid totaled
$52,491.</TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt">During the six months ended June&nbsp;30, 2003:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD>102,727 shares of common stock were issued in connection with stock
grants, 28,451 shares were withheld to satisfy employees&#146; tax
withholding and other liabilities and 11,902 shares were forfeited, for
a net value of $2,985.</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD>The Company sold one community with a mortgage note payable of
$27,305 that was assumed by the buyer as part of the total sales price.</TD>
</TR>

</TABLE>

<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD>7,992 units of limited partnership in DownREIT partnerships valued
at $295 were redeemed as partial repayment of outstanding tax loans.</TD>
</TR>
</TABLE>

<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD>The Company recorded a reduction to other liabilities and a
corresponding gain to other comprehensive income of $491 to adjust the
Company&#146;s Hedged Derivatives to their fair value.</TD>
</TR>
</TABLE>

<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD>Common and preferred dividends declared but not paid totaled
$49,453.</TD>
</TR>
</TABLE>

<P>


<P align="center" style="font-size: 10pt">4
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">


</TABLE>


<P align="center" style="font-size: 10pt"><B>AVALONBAY COMMUNITIES, INC.<BR>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS<BR>
(Unaudited)<BR>
(Dollars in thousands, except per share data)</B>



<P align="left" style="font-size: 10pt">1. <U>Organization and Significant Accounting Policies</U>



<P align="left" style="font-size: 10pt"><I>Organization</I>


<P align="left" style="font-size: 10pt">AvalonBay Communities, Inc. (the &#147;Company,&#148; which term, unless the context
otherwise requires, refers to AvalonBay Communities, Inc. together with its
subsidiaries) is a Maryland corporation that has elected to be taxed as a real
estate investment trust (&#147;REIT&#148;) under the Internal Revenue Code of 1986, as
amended. The Company focuses on the ownership and operation of apartment
communities in high barrier-to-entry markets of the United States. These
markets are located in the Northeast, Mid-Atlantic, Midwest, Pacific Northwest,
and Northern and Southern California regions of the country.


<P align="left" style="font-size: 10pt">At June&nbsp;30, 2004, the Company owned or held a direct or indirect ownership
interest in 133 operating apartment communities containing 38,527 apartment
homes in ten states and the District of Columbia, of which one community
containing 781 apartment homes was under reconstruction. In addition, the
Company owned or held a direct or indirect ownership interest in 14 communities
under construction that are expected to contain an aggregate of 4,149 apartment
homes when completed. The Company also owned a direct or indirect ownership
interest in rights to develop an additional 40 communities that, if developed
in the manner expected, will contain an estimated 10,728 apartment homes.


<P align="left" style="font-size: 10pt">During the three months ended June&nbsp;30, 2004:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD>The Company acquired one community, Avalon at Redondo Beach,
located in Los Angeles, California. This garden-style community
contains 105 apartment homes and was acquired for an acquisition price
of $24,065.</TD>
</TR>

</TABLE>


<div>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD>The Company sold two communities, Avalon Greenbriar, located in
Seattle, Washington, and Avalon at Laguna Niguel, located in Orange
County, California. These two communities, which contained a total of
597 apartment homes, were sold for an aggregate sales price of $61,100,
including the transfer of $18,755 of variable rate, tax-exempt debt
associated with one of the communities. In addition, variable rate,
tax-exempt debt of $10,400 was repaid immediately prior to the sale of
the other community. The sale of these communities resulted in a gain
calculated in accordance with generally accepted accounting principles
(&#147;GAAP&#148;) of $12,375.</TD>
</TR>

</TABLE>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD>The Company commenced development of three communities, Avalon at
Juanita Village, located in Seattle, Washington, and Avalon Del Rey and
Avalon Camarillo, both located in the Los Angeles, California area.
These communities, when completed, are expected to contain an aggregate
of 769 apartment homes for a total capitalized cost of approximately
$158,200. Both Avalon at Juanita Village and Avalon Del Rey will be
subject to joint venture ownership structures upon construction
completion, as described in Note 6, &#147;Investments in Unconsolidated Real
Estate Entities.&#148;</TD>
</TR>

</TABLE>
</div>
<P align="left" style="font-size: 10pt">The interim unaudited financial statements have been prepared in accordance
with GAAP for interim financial information and in conjunction with the rules
and regulations of the Securities and Exchange Commission. Certain information
and footnote disclosures normally included in financial statements required by
GAAP have been condensed or omitted pursuant to such rules and regulations.
These unaudited financial statements should be read in conjunction with the
financial statements and notes included in the Company&#146;s Annual Report on Form
10-K for the year ended December&nbsp;31, 2003. The results of operations for the
six months ended June&nbsp;30, 2004 are not necessarily indicative of the operating
results for the full year. Management believes the disclosures are adequate to
ensure the information presented is not misleading. In the opinion of
management, all adjustments and eliminations, consisting only of normal,
recurring adjustments necessary for a fair presentation of the financial
statements for the interim periods, have been included.



<P align="center" style="font-size: 10pt">5
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">




<P align="left" style="font-size: 10pt"><I>Principles of Consolidation</I>


<P align="left" style="font-size: 10pt">The Company assesses consolidation of variable interest entities under the
guidance of FASB Interpretation No.&nbsp;46 (&#147;FIN 46&#148;), &#147;Consolidation of Variable
Interest Entities, an Interpretation of ARB No.&nbsp;51,&#148; as revised in December
2003. The Company accounts for joint venture partnerships and subsidiary
partnerships structured as DownREITs that are not variable interest entities in
accordance with Statement of Position (&#147;SOP&#148;) 78-9, &#147;Accounting for Investments
in Real Estate Ventures.&#148; Under SOP 78-9, the Company consolidates joint
venture and DownREIT partnerships when the Company controls the major operating
and financial policies of the partnership through majority ownership or in its
capacity as general partner. The accompanying Condensed Consolidated Financial
Statements include the accounts of the Company and its wholly-owned
partnerships, certain joint venture partnerships, subsidiary partnerships
structured as DownREITs and one variable interest entity under FIN 46. All
significant intercompany balances and transactions have been eliminated in
consolidation.


<P align="left" style="font-size: 10pt">In each of the partnerships structured as DownREITs, either the Company or one
of the Company&#146;s wholly-owned subsidiaries is the general partner, and there
are one or more limited partners whose interest in the partnership is
represented by units of limited partnership interest. For each DownREIT
partnership, limited partners are entitled to receive an initial distribution
before any distribution is made to the general partner. Although the
partnership agreements for each of the DownREITs are different, generally the
distributions per unit paid to the holders of units of limited partnership
interests have approximated the Company&#146;s current common stock dividend per
share. Each DownREIT partnership has been structured so that it is unlikely
the limited partners will be entitled to a distribution greater than the
initial distribution provided for in the partnership agreement. The holders of
units of limited partnership interest have the right to present each unit of
limited partnership interest for redemption for cash equal to the fair market
value of a share of the Company&#146;s common stock on the date of redemption. In
lieu of a cash redemption by the partnership of a limited partner&#146;s unit, the
Company may elect to acquire any unit presented for redemption for one share of
common stock or for such cash amount.


<P align="left" style="font-size: 10pt">The Company accounts for investments in unconsolidated entities that are not
variable interest entities in accordance with SOP 78-9 and Accounting
Principles Board (&#147;APB&#148;) Opinion No.&nbsp;18, &#147;The Equity Method of Accounting for
Investments in Common Stock.&#148; The Company uses the equity method to account
for investments in which it owns greater than 20% of the equity value or has
significant and disproportionate influence over that entity. Investments in
which the Company owns 20% or less of the equity value and does not have
significant and disproportionate influence are accounted for using the cost
method. If there is an event or change in circumstance that indicates a loss
in the value of an investment, the Company&#146;s policy is to record the loss and
reduce the value of the investment to its fair value. A loss in value would be
indicated if the Company could not recover the carrying value of the investment
or if the investee could not sustain an earnings capacity that would justify
the carrying amount of the investment.



<P align="left" style="font-size: 10pt"><I>Revenue Recognition</I>


<P align="left" style="font-size: 10pt">Rental income related to leases is recognized on an accrual basis when due from
residents in accordance with Securities and Exchange Commission (&#147;SEC&#148;) Staff
Accounting Bulletin No.&nbsp;104, &#147;Revenue Recognition&#148; and Statement of Financial
Accounting Standards (&#147;SFAS&#148;) No.&nbsp;13, &#147;Accounting for Leases.&#148; In accordance
with the Company&#146;s standard lease terms, rental payments are generally due on a
monthly basis. Any cash concessions given at the inception of the lease are
amortized over the approximate life of the lease, which is generally one year.



<P align="left" style="font-size: 10pt"><I>Real Estate</I>


<P align="left" style="font-size: 10pt">Significant expenditures which improve or extend the life of an asset are
capitalized. The operating real estate assets are stated at cost and consist of
land, buildings and improvements, furniture, fixtures and equipment, and other
costs incurred during their development, redevelopment and acquisition.
Expenditures for maintenance and repairs are charged to operations as incurred.


<P align="left" style="font-size: 10pt">The Company&#146;s policy with respect to capital expenditures is generally to
capitalize only non-recurring expenditures. Improvements and upgrades are
capitalized only if the item exceeds $15, extends the useful life of the asset
and is not related to making an apartment home ready for the next resident.
Purchases of personal property, such as computers and furniture, are
capitalized only if the item is a new addition and exceeds $2.5. The Company
generally expenses purchases of personal property made for replacement
purposes.



<P align="center" style="font-size: 10pt">6
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">The capitalization of costs during the development of assets (including
interest and related loan fees, property taxes and other direct and indirect
costs) begins when active development commences and ends when the asset, or a
portion of an asset, is delivered and is ready for its intended use, which is
generally indicated by the issuance of a certificate of occupancy. Cost
capitalization during redevelopment of apartment homes (including interest and
related loan fees, property taxes and other direct and indirect costs) begins
when an apartment home is taken out-of-service for redevelopment and ends when
the apartment home redevelopment is completed and the apartment home is
available for a new resident.


<P align="left" style="font-size: 10pt">In accordance with SFAS No.&nbsp;67, &#147;Accounting for Costs and Initial Rental
Operations of Real Estate Projects,&#148; the Company capitalizes pre-development
costs incurred in pursuit of new development opportunities for which the
Company currently believes future development is probable (&#147;Development
Rights&#148;). Future development of these Development Rights is dependent upon
various factors, including zoning and regulatory approval, rental market
conditions, construction costs and availability of capital. Pre-development
costs incurred in the pursuit of Development Rights for which future
development is not yet considered probable are expensed as incurred. In
addition, if the status of a Development Right changes, deeming future
development no longer probable, any capitalized pre-development costs are
written-off with a charge to expense. Abandoned pursuit costs were
$1,177 and $1,050 for the six months ended June 30, 2004 and 2003,
respectively.


<P align="left" style="font-size: 10pt">Depreciation is calculated on buildings and improvements using the
straight-line method over their estimated useful lives, which range from seven
to thirty years. Furniture, fixtures and equipment are generally depreciated
using the straight-line method over their estimated useful lives, which range
from three years (primarily computer-related equipment) to seven years.


<P align="left" style="font-size: 10pt">Lease terms for apartment homes are generally one year or less. Rental income
and operating costs incurred during the initial lease-up or post-redevelopment
lease-up period are fully recognized as they accrue.


<P align="left" style="font-size: 10pt">If there is an event or change in circumstance that indicates an impairment in
the value of an operating community, the Company&#146;s policy is to assess any
impairment in value by making a comparison of the current and projected
operating cash flows of the community over its remaining useful life, on an
undiscounted basis, to the carrying amount of the community. If the carrying
amount is in excess of the estimated projected operating cash flows of the
community, the Company would recognize an impairment loss equivalent to an
amount required to adjust the carrying amount to its estimated fair market
value.



<P align="left" style="font-size: 10pt"><I>Deferred Financing Costs</I>


<P align="left" style="font-size: 10pt">Deferred financing costs include fees and costs incurred to obtain debt
financing and are amortized on a straight-line basis, which approximates the
effective interest method, over the shorter of the term of the loan or the
related credit enhancement facility, if applicable. Unamortized financing
costs are written-off when debt is retired before the maturity date.
Accumulated amortization of deferred financing costs was $21,375 at June&nbsp;30,
2004 and $19,266 at December&nbsp;31, 2003.



<P align="left" style="font-size: 10pt"><I>Cash, Cash Equivalents and Cash in Escrow</I>


<P align="left" style="font-size: 10pt">Cash and cash equivalents include all cash and liquid investments with an
original maturity of six months or less from the date acquired. The majority
of the Company&#146;s cash, cash equivalents and cash in escrows is held at major
commercial banks.



<P align="left" style="font-size: 10pt"><I>Interest Rate Contracts</I>


<P align="left" style="font-size: 10pt">The Company utilizes derivative financial instruments to manage interest rate
risk and has designated these financial instruments as hedges under the
guidance of SFAS No.&nbsp;133, &#147;Accounting for Derivative Instruments and Hedging
Activities,&#148; and SFAS No.&nbsp;138, &#147;Accounting for Certain Instruments and Certain
Hedging Activities, an Amendment of Statement No.&nbsp;133.&#148; For fair value hedge
transactions, changes in the fair value of the derivative instrument and
changes in the fair value of the hedged item due to the risk being hedged are
recognized in current period earnings. For cash flow hedge transactions,
changes in the fair value of the derivative instrument are reported in other
comprehensive income. For cash flow hedges where the changes in the fair value
of the derivative exceed the change in fair value of the



<P align="center" style="font-size: 10pt">7
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">hedged item, the
ineffective portion is recognized in current period earnings. Derivatives
which are not part of a hedge relationship are recorded at fair value through
earnings. As of June&nbsp;30, 2004, the Company had approximately $207,000 in
variable rate debt subject to cash flow hedges. See Note 5, &#147;Derivative
Instruments and Hedging Activities.&#148;



<P align="left" style="font-size: 10pt"><I>Comprehensive Income</I>


<P align="left" style="font-size: 10pt">Comprehensive income, as reflected on the Condensed Consolidated Statements of
Operations and Other Comprehensive Income, is defined as all changes in equity
during each period except for those resulting from investments by or
distributions to shareholders. Accumulated other comprehensive loss as
reflected in Note 4, &#147;Stockholders&#146; Equity,&#148; reflects the changes in the fair
value of effective cash flow hedges.



<P align="left" style="font-size: 10pt"><I>Earnings per Common Share</I>


<P align="left" style="font-size: 10pt">In accordance with the provisions of SFAS No.&nbsp;128, &#147;Earnings per Share,&#148; basic
earnings per share is computed by dividing earnings available to common
stockholders by the weighted average number of shares outstanding during the
period. Other potentially dilutive common shares, and the related impact to
earnings, are considered when calculating earnings per share on a diluted
basis. The Company&#146;s earnings per common share are determined as follows:




<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="52%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7"><B>For the three months ended</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7"><B>For the six months ended</B><HR size="1" noshade></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>6-30-04</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>6-30-03</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>6-30-04</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>6-30-03</B><HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><U>Basic and diluted shares outstanding</U>
&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Weighted average common shares &#151; basic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">71,409,668</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">67,231,296</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">71,164,908</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">67,427,853</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Weighted average DownREIT units outstanding</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">581,941</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">968,581</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">594,850</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">972,146</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Effect of dilutive securities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,045,875</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">703,268</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,031,712</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">607,505</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Weighted average common shares &#151; diluted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">73,037,484</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">68,903,145</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">72,791,470</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">69,007,504</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><U>Calculation of Earnings per Share &#151; basic</U>
&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Net income available to common stockholders</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">32,859</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">73,762</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">55,961</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">107,462</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Weighted average common shares &#151; basic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">71,409,668</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">67,231,296</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">71,164,908</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">67,427,853</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Earnings per common share &#151; basic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.46</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.10</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.79</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.59</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><U>Calculation of Earnings per Share &#151; diluted</U>
&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Net income available to common stockholders</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">32,859</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">73,762</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">55,961</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">107,462</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Add: Minority interest of DownREIT unitholders
in consolidated partnerships, including discontinued operations</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">912</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">379</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,239</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">762</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Adjusted net income available to common stockholders</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">33,771</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">74,141</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">57,200</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">108,224</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Weighted average common shares &#151; diluted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">73,037,484</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">68,903,145</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">72,791,470</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">69,007,504</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Earnings per common share &#151; diluted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.46</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.08</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.79</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.57</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>

<P align="left" style="font-size: 10pt">Certain employee options to purchase shares of common stock of 3,000 were
outstanding during both the three and six months ended June&nbsp;30, 2004 and
1,459,439 and 1,521,360 were outstanding during the three and six months ended
June&nbsp;30, 2003, respectively, but were not included in the computation of
diluted earnings per share because the options&#146; exercise prices were greater
than the average market price of the common shares for the period and
therefore, are anti-dilutive.




<P align="center" style="font-size: 10pt">8
</DIV>


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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<DIV style="font-family: 'Times New Roman',Times,serif">


<P align="left" style="font-size: 10pt"><I>Stock-Based Compensation</I>


<P align="left" style="font-size: 10pt">Effective January&nbsp;1, 2003, the Company adopted the fair value recognition
provisions of SFAS No.&nbsp;123, &#147;Accounting for Stock-Based Compensation,&#148; as
amended by SFAS No.&nbsp;148, &#147;Accounting for Stock-Based Compensation &#150; Transition
and Disclosure &#150; an amendment of FASB Statement No.&nbsp;123,&#148; prospectively to all
employee awards granted, modified, or settled on or after January&nbsp;1, 2003.
Awards under the Company&#146;s stock option plans vest over periods ranging from
one to three years. Therefore, the cost related to stock-based employee
compensation for employee stock options included in the determination of net
income for the three and six months ended June&nbsp;30, 2004 and 2003, is less than
that which would have been recognized if the fair value based method had been
applied to all awards since the original effective date of SFAS No.&nbsp;123.


<P align="left" style="font-size: 10pt">The following table illustrates the effect on net income available to common
stockholders and earnings per share if the fair value based method had been
applied to all outstanding and unvested awards in each period based on the fair
market value as determined on the date of grant:


<DIV align="center">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="10%">&nbsp;</TD>
    <TD width="50%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">For the three months ended<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">For the six months ended<HR size="1" noshade></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-04<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-03<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-04<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-03<HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px">Net income available to common stockholders, as reported</DIV></TD>
    <TD align="right">$</TD>
    <TD align="right">32,859</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">73,762</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">55,961</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">107,462</TD>
    <TD>&nbsp;</TD>
</TR>
<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Add:</DIV></TD>
    <TD>Actual compensation expense recorded under fair value<BR>
based method, net of related tax effects</TD>
    <TD>&nbsp;</TD>
    <TD align="right">224</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">61</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">404</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">97</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Deduct:</DIV></TD>
    <TD>Total compensation expense determined under fair value<BR>
based method, net of related tax effects</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(561</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(568</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(908</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(1,232</TD>
    <TD nowrap>)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px">Pro forma net income available to common stockholders</DIV></TD>
    <TD align="right">$</TD>
    <TD align="right">32,522</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">73,255</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">55,457</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">106,327</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px">Earnings per share:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="2"><DIV style="margin-left:20px; text-indent:-10px">Basic &#151; as reported</DIV></TD>
    <TD align="right">$</TD>
    <TD align="right">0.46</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.10</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.79</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.59</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD colspan="2"><DIV style="margin-left:20px; text-indent:-10px">Basic &#151; pro forma</DIV></TD>
    <TD align="right">$</TD>
    <TD align="right">0.46</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.09</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.78</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.58</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="2"><DIV style="margin-left:20px; text-indent:-10px">Diluted &#151; as reported</DIV></TD>
    <TD align="right">$</TD>
    <TD align="right">0.46</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.08</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.79</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.57</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD colspan="2"><DIV style="margin-left:20px; text-indent:-10px">Diluted &#151; pro forma</DIV></TD>
    <TD align="right">$</TD>
    <TD align="right">0.46</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.07</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.78</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.55</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>



<P align="left" style="font-size: 10pt"><I>Variable Interest Entities under FIN 46</I>


<P align="left" style="font-size: 10pt">In December&nbsp;2003, the Financial Accounting Standards Board (&#147;FASB&#148;) issued the
revised FIN 46, which changed the guidelines for consolidation of and
disclosure related to unconsolidated entities, if those unconsolidated entities
qualify as variable interest entities as defined in FIN 46. The Company had
previously adopted the provisions of FIN 46 for variable interest entities
created after January&nbsp;31, 2003. However, the adoption of FIN 46 for variable
interest entities created on or before January&nbsp;31, 2003 was required for
periods ending after March&nbsp;15, 2004. The Company has adopted the final
provisions of FIN 46 as of January&nbsp;1, 2004, resulting in the consolidation of
one entity from which the Company holds a participating mortgage loan as
described in Note 9, &#147;Related Party Arrangements.&#148; The consolidation of this
entity resulted in an increase to net real estate assets of approximately
$33,000 and the elimination of the previously recorded mortgage note and
accrued interest of approximately $27,300. In addition, the Company recognized
a cumulative effect of change in accounting principle during the six months
ended June&nbsp;30, 2004 in the amount of $4,547, which increased earnings per
common share &#150; diluted by $0.06. The Company does not hold an equity interest
in this entity, and therefore 100% of the entity&#146;s net income or loss is
recognized by the Company as minority interest in consolidated partnerships on
the Condensed Consolidated Statements of Operations and Other Comprehensive
Income.



<P align="left" style="font-size: 10pt"><I>Discontinued Operations</I>


<P align="left" style="font-size: 10pt">On January&nbsp;1, 2002, the Company adopted SFAS No.&nbsp;144, &#147;Accounting for the
Impairment or Disposal of Long-Lived Assets&#148; which requires that the assets and
liabilities and the results of operations of any communities which have been
sold since January&nbsp;1, 2002, or otherwise qualify as held for sale, be presented
as discontinued operations in the Company&#146;s Condensed Consolidated Financial
Statements in both current and prior periods presented. The community specific
components of net income that are presented as discontinued operations include
net operating income, depreciation expense, minority interest expense and
interest expense. In addition, the net gain or loss



<P align="center" style="font-size: 10pt">9
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">(including any impairment
loss) on the eventual disposal of communities held for sale will be presented
as discontinued operations when recognized. A change in presentation for
discontinued operations will not have any impact on the Company&#146;s financial
condition or results of operations. Real estate assets held for sale are
measured at the lower of the carrying amount or the fair value less the cost to
sell, and are presented separately in the accompanying Condensed Consolidated
Balance Sheets. Subsequent to classification of a community as held for sale,
no further depreciation is recorded on the assets.



<P align="left" style="font-size: 10pt"><I>Improved Land Acquisitions</I>


<P align="left" style="font-size: 10pt">During the three months ended June&nbsp;30, 2004, the Company acquired two parcels
of improved land in connection with two Development Rights for an aggregate
purchase price of $21,800, which included the assumption of $13,322 in debt.
The Company intends to manage the current improvements, which are occupied
office buildings, until such time as all tenant obligations have been satisfied
or eliminated through negotiation and construction of new apartment communities
is ready to begin. As such, as provided under the guidance of SFAS No.&nbsp;67, the
revenue from incidental operations received from the current improvements in
excess of any incremental costs are being recorded as a reduction of total
capitalized costs and not as part of net income.



<P align="left" style="font-size: 10pt"><I>Use of Estimates</I>


<P align="left" style="font-size: 10pt">The preparation of financial statements in conformity with GAAP requires
management to make certain estimates and assumptions. These estimates and
assumptions affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the dates of the financial
statements and the reported amounts of revenue and expenses during the
reporting periods. Actual results could differ from those estimates.



<P align="left" style="font-size: 10pt"><I>Revised Financial Presentation for Preferred Stock Redemption</I>


<P align="left" style="font-size: 10pt">In July&nbsp;2003, the Securities and Exchange Commission clarified Emerging Issues
Task Force Topic D-42, &#147;The Effect on the Calculation of Earnings per Share for
the Redemption or Induced Conversion of Preferred Stock,&#148; which was applied
retroactively. As such, the Company revised its historical results of
operations for the three and six months ended June&nbsp;30, 2003 to reflect
additional dividends attributable to preferred stock of $280. This revision
did not have any impact on earnings per common share &#150; diluted during those
periods.



<P align="left" style="font-size: 10pt"><I>Reclassifications</I>



<P align="left" style="font-size: 10pt">Certain reclassifications have been made to amounts in prior period&#146;s financial
statements to conform with current period presentations.


<P align="left" style="font-size: 10pt">2. &nbsp;&nbsp;&nbsp;<U>Interest Capitalized</U>


<P align="left" style="font-size: 10pt">Capitalized interest associated with communities under development or
redevelopment totaled $5,010 and $6,305 for the three months ended June&nbsp;30,
2004 and 2003, respectively, and $10,078 and $12,511 for the six months ended
June&nbsp;30, 2004 and 2003, respectively.

<P align="center" style="font-size: 10pt">10
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">




<P align="left" style="font-size: 10pt">3. &nbsp;&nbsp;&nbsp;<U>Notes Payable, Unsecured Notes and Credit Facility</U>



<P align="left" style="font-size: 10pt">The Company&#146;s mortgage notes payable, unsecured notes and variable rate
unsecured credit facility as of June&nbsp;30, 2004 and December&nbsp;31, 2003 are
summarized as follows:

<DIV align="left">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="85%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="76%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-04<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">12-31-03<HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Fixed rate unsecured notes (1)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1,859,436</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1,835,284</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Fixed rate mortgage notes payable &#151; conventional and tax-exempt</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">233,989</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">334,028</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Variable rate mortgage notes payable &#151; conventional and tax-exempt (2)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">181,500</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">80,879</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Total notes payable and unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,274,925</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,250,191</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Variable rate secured short-term debt</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">36,311</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">36,526</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Variable rate unsecured credit facility</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">128,900</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">51,100</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Total mortgage notes payable, unsecured notes and unsecured credit facility</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">2,440,136</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">2,337,817</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>




<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 7pt">

<TR valign="top">
    <TD width="1%" nowrap align="right">(1)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="96%">Balances at June&nbsp;30, 2004 and December&nbsp;31, 2003 include $564 of debt
discount and $284 of debt premium, respectively, received at issuance of
unsecured notes.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(2)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="96%">Balance at December&nbsp;31, 2003 includes $29,155 related to real estate assets
held for sale.</TD>
</TR>

</TABLE>


<P align="left" style="font-size: 10pt">During the six months ended June&nbsp;30, 2004, the Company repaid $125,000 of
previously issued unsecured notes, along with any unpaid interest, pursuant to
their scheduled maturity, and no prepayment fees were incurred. In addition,
the Company issued $150,000 in unsecured notes under its existing shelf
registration statement at an interest rate of 5.375%. Interest on these newly
issued notes is payable semi-annually on April&nbsp;15 and October&nbsp;15, and they
mature on April&nbsp;15, 2014. The Company&#146;s unsecured notes contain a number of
financial and other covenants with which the Company must comply, including,
but not limited to, limits on the aggregate amount of total and secured
indebtedness the Company may have on a consolidated basis and limits on the
Company&#146;s required debt service payments.


<P align="left" style="font-size: 10pt">During the six months ended June&nbsp;30, 2004, the Company repaid $24,251 in fixed
rate mortgage debt secured by two current communities, along with any unpaid
interest, repaid $10,400 in variable rate, tax-exempt debt related to the sale
of a community and transferred $18,755 in variable rate, tax-exempt debt
related to the sale of a community to the purchaser. In addition, the Company
issued $42,800 in variable rate, conventional mortgage debt on two communities
and assumed $13,322 in fixed rate debt in connection with the acquisition of
two parcels of improved land. In the aggregate, mortgage notes payable mature
at various dates from April&nbsp;2005 through April&nbsp;2043 and are secured by certain
apartment communities. As of June&nbsp;30, 2004, the Company has guaranteed
approximately $112,000 of mortgage notes payable held by subsidiaries; all such
mortgage notes payable are consolidated for financial reporting purposes. The
weighted average interest rate of the Company&#146;s fixed rate mortgage notes
payable (conventional and tax-exempt) was 6.9% at June&nbsp;30, 2004 and 6.7% at
December&nbsp;31, 2003. The weighted average interest rate of the Company&#146;s
variable rate mortgage notes payable and its unsecured credit facility (as
discussed below), including the effect of certain financing related fees, was
2.8% at June&nbsp;30, 2004 and 3.5% at December&nbsp;31, 2003.


<P align="left" style="font-size: 10pt">As of June&nbsp;30, 2004 and December&nbsp;31, 2003, the Company had approximately
$70,000 and $158,000, respectively, of variable rate, tax-exempt debt
effectively fixed through Hedged Derivatives, as described in Note 5,
&#147;Derivative Instruments and Hedging Activities.&#148; In February&nbsp;2004, the credit
enhancements, including Hedged Derivatives in the form of interest rate swaps,
on approximately $87,000 of this variable rate, tax-exempt debt expired
according to their original terms and were not extended. New Hedged
Derivatives in the form of interest rate protection agreements were put in
place on the $87,000 of variable rate, tax-exempt debt, which serve to
effectively limit the level to which interest rates can rise to a range of 6.7%
to 9.0%. This $87,000 of variable rate, tax-exempt debt floats at an average
coupon interest rate of 1.6% as of June&nbsp;30, 2004. In addition, in May&nbsp;2004,
the Company entered into Hedged Derivatives in the form of interest rate
protection agreements on the newly issued $42,800 in variable rate,
conventional debt discussed above. This debt has a weighted average variable
interest rate of 2.5% as of June&nbsp;30, 2004, and the Hedged Derivatives serve to
effectively limit the level to which interest rates can rise on this debt to
10.0%.

<P align="center" style="font-size: 10pt">11
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">Scheduled payments and maturities of mortgage notes payable and unsecured notes
outstanding at June&nbsp;30, 2004 are as follows:


<DIV align="center">
<TABLE style="font-size: 9pt" cellspacing="0" border="0" cellpadding="0" width="45%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="14%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>

<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Stated</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Unsecured</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">interest rate</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Secured notes</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Secured notes</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">notes</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">of unsecured</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center">Year<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">payments<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">maturities<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">maturities<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">notes<HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="center">2004</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">3,224</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" align="center">
    <TD>2005</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,164</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">36,311</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">100,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.625</TD>
    <TD align="left" nowrap>%</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
<TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">50,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.500</TD>
    <TD align="left" nowrap>%</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" align="center" style="background: #eeeeee">
    <TD align="center">2006</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,584</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.800</TD>
    <TD align="left" nowrap>%</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="center">2007</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,030</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">110,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.875</TD>
    <TD align="left" nowrap>%</TD>
</TR>

<TR valign="bottom" align="center">
<TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">5.000</TD>
    <TD align="left" nowrap>%</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="center">2008</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,476</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,368</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">50,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.625</TD>
    <TD align="left" nowrap>%</TD>
</TR>

<TR valign="bottom" align="center">
<TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">8.250</TD>
    <TD align="left" nowrap>%</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="center">2009</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,874</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">36,033</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.500</TD>
    <TD align="left" nowrap>%</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" align="center">
    <TD>2010</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,999</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">29,388</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">200,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.500</TD>
    <TD align="left" nowrap>%</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="center">2011</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,360</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,204</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">300,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.625</TD>
    <TD align="left" nowrap>%</TD>
</TR>

<TR valign="bottom" align="center">
<TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">50,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.625</TD>
    <TD align="left" nowrap>%</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="center">2012</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,948</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,095</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">250,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.125</TD>
    <TD align="left" nowrap>%</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" align="center">
    <TD align="center">2013</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,140</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
<TD align="center">Thereafter</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">151,186</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">113,416</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">5.375</TD>
    <TD align="left" nowrap>%</TD>
</TR>

<TR style="font-size: 1px">
<TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" align="center">
<TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">212,985</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">238,815</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1,860,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
<TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>


<P align="left" style="font-size: 10pt">The Company has a $500,000 revolving variable rate unsecured credit facility
with JPMorgan Chase Bank and Wachovia Bank, N.A. serving as banks and
syndication agents for a syndicate of commercial banks, which the Company
refinanced in May&nbsp;2004, concurrent with its original maturity date. The
Company had $128,900 outstanding under the facility and $22,196 in letters of
credit on June&nbsp;30, 2004 and $51,100 outstanding and $19,901 in letters of
credit on December&nbsp;31, 2003. Under the terms of the new credit facility, which
are substantially consistent with the terms of the old facility, if the Company
elects to increase the facility by up to an additional $150,000, and one or
more banks (from the syndicate or otherwise) voluntarily agree to provide the
additional commitment, then the Company will be able to increase the facility
up to $650,000, and no member of the syndicate of banks can prohibit such
increase; such an increase in the facility will only be effective to the extent
banks (from the syndicate or otherwise) choose to commit to lend additional
funds. The Company pays participating banks, in the aggregate, an annual
facility fee of approximately $750 in quarterly installments. The unsecured
credit facility bears interest at varying levels based on the London Interbank
Offered Rate (&#147;LIBOR&#148;), rating levels achieved on the Company&#146;s unsecured notes
and on a maturity schedule selected by the Company. The current stated pricing
is LIBOR plus 0.55% per annum (1.92% on June&nbsp;30, 2004). The spread over LIBOR
can vary from LIBOR plus 0.50% to LIBOR plus 1.15% based upon the rating of the
Company&#146;s long-term unsecured debt. In addition, the unsecured credit facility
includes a competitive bid option, which allows banks that are part of the
lender consortium to bid to make loans to the Company at a rate that is lower
than the stated rate provided by the unsecured credit facility for up to
$250,000. The competitive bid option may result in lower pricing if market
conditions allow. The Company had no balance outstanding under this
competitive bid option at June&nbsp;30, 2004. The Company is subject to (i)&nbsp;certain
customary covenants under the unsecured credit facility, including, but not
limited to, maintaining certain maximum leverage ratios, a minimum fixed
charges coverage ratio and minimum unencumbered assets and equity levels and
(ii)&nbsp;prohibitions on paying dividends in amounts that exceed 95% of the
Company&#146;s Funds from Operations, as defined therein, except as may be required
to maintain the Company&#146;s REIT status. The new facility matures in May&nbsp;2008,
assuming exercise of a one-year renewal option by the Company.

<P align="center" style="font-size: 10pt">12
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">




<P align="left" style="font-size: 10pt">4.&nbsp;&nbsp;&nbsp; <U>Stockholders&#146; Equity</U>



<P align="left" style="font-size: 10pt">The following summarizes the changes in stockholders&#146; equity for the six months
ended June&nbsp;30, 2004:

<DIV align="center">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="25%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Dividends less</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Accumulated</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Additional</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">than (in excess</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">other</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Preferred</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Common</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">paid-in</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Deferred</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">of) accumulated</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">comprehensive</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Stockholders'</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">stock<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">stock<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">capital<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">compensation<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">earnings<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">loss<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">equity<HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Balance at December&nbsp;31, 2003</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">40</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">709</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">2,322,581</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">(5,808</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">2,024</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">(8,212</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">2,311,334</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Net income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">60,311</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">60,311</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Unrealized loss on cash flow hedges</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">935</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">935</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Dividends declared to common
and preferred stockholders</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(104,693</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(104,693</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Issuance of common stock, net of withholdings</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">37,267</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(5,702</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(657</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">30,918</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Issuance of stock options</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,047</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2,047</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Amortization of deferred compensation</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,324</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,324</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Balance at June&nbsp;30, 2004</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">40</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">719</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">2,361,895</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">(11,233</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">(43,015</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">(7,277</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">2,301,129</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>


<P align="left" style="font-size: 10pt">During the six months ended June&nbsp;30, 2004, the Company (i)&nbsp;issued 794,449
shares of common stock in connection with stock options exercised, (ii)&nbsp;issued
49,391 shares of common stock in exchange for the redemption of an equal number
of DownREIT limited partnership units, (iii)&nbsp;issued 147,517 common shares in
connection with stock grants to employees of which 80% are restricted, (iv)&nbsp;had
forfeitures of 72 shares of restricted stock grants to employees and (v)
withheld 49,583 shares to satisfy employees&#146; tax withholding and other
liabilities.


<P align="left" style="font-size: 10pt">Dividends per common share for both the six months ended June&nbsp;30, 2004 and 2003
were $1.40 per share. In the six months ended June&nbsp;30, 2004, average dividends
for all non-redeemed preferred shares during the period were $1.09 per share,
and no preferred shares were redeemed. In the six months ended June&nbsp;30, 2003,
average dividends for preferred shares redeemed during the period were $0.31
per share and average dividends for all non-redeemed preferred shares were
$1.09 per share. As announced in March&nbsp;2004, the Company resumed its Dividend
Reinvestment and Stock Purchase Plan (the &#147;DRIP&#148;) effective with the Company&#146;s
common stock dividend for the three months ended June&nbsp;30, 2004.



<P align="left" style="font-size: 10pt">5. &nbsp;&nbsp;&nbsp;<U>Derivative Instruments and Hedging Activities</U>


<P align="left" style="font-size: 10pt">The Company has historically used interest rate swap and cap agreements
(collectively, the &#147;Hedged Derivatives&#148;) to reduce the impact of interest rate
fluctuations on its variable rate, tax-exempt bonds. The Company has not
entered into any interest rate hedge agreements or treasury locks for its
conventional unsecured debt and does not hold interest rate hedge agreements
for trading or other speculative purposes. As of June&nbsp;30, 2004, the Hedged
Derivatives fix approximately $70,000 of the Company&#146;s tax-exempt debt at a
weighted average interest rate of 6.3% through interest rate swaps. In
addition, as of June&nbsp;30, 2004, the Company has Hedged Derivatives on $137,000
of its variable rate debt, which floats at a weighted average coupon interest
rate of 1.9% and has been capped at a weighted average interest rate of 8.2%
through interest rate caps. These Hedged Derivatives have maturity dates
ranging from 2007 to 2010. In addition, one of the Company&#146;s unconsolidated
real estate investments (see Note 6, &#147;Investments in Unconsolidated Real Estate
Entities&#148;) has $22,500 in variable rate debt outstanding as of June&nbsp;30, 2004,
which is subject to an interest rate swap. This debt is not recourse to or
guaranteed by the Company. The Hedged Derivatives are accounted for in
accordance with SFAS No.&nbsp;133, which as amended, was adopted by the Company on
January&nbsp;1, 2001. SFAS No.&nbsp;133 requires that every derivative instrument be
recorded on the balance sheet as either an asset or liability measured at its
fair value, with changes in fair value recognized currently in earnings unless
specific hedge accounting criteria are met.


<P align="left" style="font-size: 10pt">The Company has determined that its Hedged Derivatives qualify as effective
cash-flow hedges under SFAS No.&nbsp;133, resulting in the Company recording all
changes in the fair value of the Hedged Derivatives in other comprehensive
income. Amounts recorded in other comprehensive income will be reclassified
into earnings in the period in which earnings are affected by the hedged cash
flows. To adjust the Hedged Derivatives to their fair value, the Company
recorded unrealized gains to other comprehensive income of $935 and $491 during
the six months ended June&nbsp;30, 2004 and 2003, respectively. The estimated
amount, included in accumulated other comprehensive income as of June&nbsp;30,



<P align="center" style="font-size: 10pt">13
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">2004,
expected to be reclassified into earnings within the next twelve months to
offset the variability of cash flows during this period is not material.


<P align="left" style="font-size: 10pt">The Company assesses, both at inception and on an on-going basis, the
effectiveness of all hedges in offsetting cash flows of hedged items. Hedge
ineffectiveness did not have a material impact on earnings and the Company does
not anticipate that it will have a material effect in the future. The fair
values of the obligations under the Hedged Derivatives are included in accrued
expenses and other liabilities on the accompanying Condensed Consolidated
Balance Sheets.


<P align="left" style="font-size: 10pt">By using derivative financial instruments to hedge exposures to changes in
interest rates, the Company exposes itself to credit risk and market risk. The
credit risk is the risk of a counterparty not performing under the terms of the
Hedged Derivatives. The counterparties to these Hedged Derivatives are major
financial institutions which have an A&#043; or better credit rating by the Standard
&#038; Poor&#146;s Ratings Group. The Company monitors the credit ratings of
counterparties and the amount of the Company&#146;s debt subject to Hedged
Derivatives with any one party. Therefore, the Company believes the likelihood
of realizing material losses from counterparty non-performance is remote.
Market risk is the adverse effect of the value of financial instruments that
results from a change in interest rates. The market risk associated with
interest-rate contracts is managed by the establishment and monitoring of
parameters that limit the types and degree of market risk that may be
undertaken. These risks are managed by the Company&#146;s Chief Financial Officer
and Senior Vice President &#151; Finance.



<P align="left" style="font-size: 10pt">6. &nbsp;&nbsp;&nbsp;<U>Investments in Unconsolidated Real Estate Entities</U>


<P align="left" style="font-size: 10pt">The Company accounts for investments in unconsolidated real estate entities
that are not considered variable interest entities under FIN 46 in accordance
with SOP 78-9 and APB Opinion No.&nbsp;18. The Company applies the equity method of
accounting to an investment in an entity if it owns greater than 20% of the
equity value or has significant and disproportionate influence over that
entity. At June&nbsp;30, 2004 and December&nbsp;31, 2003, the Company&#146;s investments in
unconsolidated real estate entities accounted for under the equity method of
accounting consisted of:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>a 49% general partnership interest in a partnership
that owns the Avalon Run community;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>a 50% limited liability company membership interest
in a limited liability company that owns the Avalon Grove
community; and</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>a 25% limited liability company membership interest
(with a right to 50% of distributions after achievement of
a threshold return) in a limited liability company that
owns the Avalon Bedford community.</TD>
</TR>

</TABLE>


<P align="left" style="font-size: 10pt">In addition, during the six months ended June&nbsp;30, 2004, the Company entered
into the following joint venture agreements:


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><I>Avalon Chrystie Place </I>&#150; In February&nbsp;2004, the Company entered
into a joint venture agreement with an unrelated third-party for the
development of Avalon Chrystie Place I, located in New York, New
York. In connection with the general contractor services that the
Company provides to CVP I, LLC, the entity that owns and is
developing Avalon Chrystie Place I, the Company has provided a
construction completion guarantee to the lender in order to fulfill
their standard financing requirements related to the construction
financing. The obligation of the Company under this guarantee will
terminate following construction completion once all of the lender&#146;s
standard completion requirements have been satisfied, which the
Company expects to occur in the beginning of 2006. The Company
holds a 20% equity interest in this joint venture entity (with a
right to 50% of distributions after achievement of a threshold
return), with the remaining 80% equity interest held by the
third-party. The Company accounts for this investment under the
equity method of accounting.</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><I>Avalon Del Rey </I>- In March&nbsp;2004, the Company entered into an
agreement with an unrelated third-party which provides that, after
the Company completes construction of Avalon Del Rey, the community
will be owned and operated by a joint venture between the Company
and the third-party. Upon construction completion, the third-party
venture partner will invest $49,000 and will be granted a 70%
ownership interest in the venture, with the Company retaining a 30%
equity interest. The Company will</TD>
</TR>



</TABLE>

<P align="center" style="font-size: 10pt">14
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<P><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>consolidate this entity until the
third-party venture partner contributes its investment to the
venture at construction completion.</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><I>Avalon at Juanita Village </I>- In April&nbsp;2004, the Company
entered into an agreement to develop Avalon at Juanita Village
through a wholly-owned taxable REIT subsidiary and, upon
construction completion, contribute the community to a joint
venture. Upon contribution of the community to the joint venture,
the Company expects to be reimbursed for all costs incurred to
develop the community. The third-party joint venture partner will
receive a 100% equity interest in the joint venture and will manage
the joint venture. The Company will receive a residual profits
interest and will be engaged to manage the community for a property
management fee. The Company will consolidate this community until
it is contributed into the joint venture at construction completion.</TD>
</TR>

</TABLE>


<P align="left" style="font-size: 10pt">The following is a combined summary of the financial position of the entities
accounted for using the equity method, as of the dates presented:

<DIV align="center">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="58%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="68%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">(Unaudited)<HR size="1" noshade></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-04<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">12-31-03<HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Assets:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Real estate, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">165,591</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">119,339</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Other assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">52,974</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,605</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Total assets</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">218,565</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">121,944</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Liabilities and partners&#146; equity:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Mortgage notes payable</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">81,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">22,500</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Other liabilities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9,944</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,158</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Partners&#146; equity</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">127,621</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">97,286</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Total liabilities and partners&#146; equity</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">218,565</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">121,944</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>


<P align="left" style="font-size: 10pt">The following is a combined summary of the operating results of the entities
accounted for using the equity method, for the periods presented:


<DIV align="center">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="67%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="22%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">For the three months ended</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">For the six months ended</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">(unaudited)<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">(unaudited)<HR size="1" noshade></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-04<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-03<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-04<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-03<HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Rental income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">5,343</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">5,167</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">10,450</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">10,400</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Operating and other expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2,030</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(1,967</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(4,102</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(3,829</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Interest expense, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(443</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(437</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(893</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(805</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Depreciation expense</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(999</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(972</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2,002</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2,000</TD>
    <TD nowrap>)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Net income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1,871</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1,791</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">3,453</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">3,766</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>


<P align="left" style="font-size: 10pt">The Company also holds a 25% limited liability company membership interest in
the limited liability company that owns Avalon on the Sound. The Company,
which originally owned 100% of the limited liability company, sold a 75%
controlling interest in the limited liability company to a third-party in 2000.
As part of the sale, the Company retained an option to repurchase the 75%
interest. The Company believes it is unlikely that the repurchase option will
be exercised. This repurchase option will terminate in December&nbsp;2004. In
accordance with SFAS No.&nbsp;66, &#147;Accounting for Sales of Real Estate,&#148; the sale of
the 75% interest is not recognized due to the existence of the repurchase
option, and therefore the Company accounts for Avalon on the Sound as a
profit-sharing arrangement. As a result, the revenues and expenses, and assets
and liabilities of Avalon on the Sound are included in the Company&#146;s Condensed
Consolidated Financial Statements, with the 75% interest presented as part of
accrued expenses and other liabilities on the Company&#146;s Condensed Consolidated
Balance Sheets. The income allocated to the controlling partner is shown as
venture partner interest in profit-sharing on the Company&#146;s Condensed
Consolidated Statements of Operations and Other Comprehensive Income.

<P align="center" style="font-size: 10pt">15
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">




<P align="left" style="font-size: 10pt">7. &nbsp;&nbsp;&nbsp;<U>Discontinued Operations &#150; Real Estate Assets Sold or Held for Sale</U>


<P align="left" style="font-size: 10pt">During the six months ended June&nbsp;30, 2004, the Company sold two communities,
one located in Seattle, Washington and one located in Laguna Niguel,
California. These two communities, which contained a total of 597 apartment
homes, were sold for an aggregate sales price of $61,100, resulting in the
transfer of debt of $18,755, net proceeds of $40,909 and a gain calculated in
accordance with GAAP of $12,375. One of the communities sold had debt of
$10,400 which was extinguished immediately prior to the sale. During the six
months ended June&nbsp;30, 2003, the Company sold seven communities, five comprising
the entire Minneapolis, Minnesota portfolio, and two single asset sales, one in
Los Angeles, California and one in Huntington Beach, California. These seven
communities, which contained a total of 2,091 apartment homes, were sold for an
aggregate sales price of $232,155, resulting in the transfer of debt of
$27,305, net proceeds of $202,845 and a gain in accordance with GAAP of
$68,583.


<P align="left" style="font-size: 10pt">In addition, as of June&nbsp;30, 2004, the Company had one community that qualified
as held for sale under the provisions of SFAS No.&nbsp;144. As required under SFAS
No.&nbsp;144, the operations for any communities sold from January&nbsp;1, 2003 through
June&nbsp;30, 2004 and communities held for sale as of June&nbsp;30, 2004 have been
presented as discontinued operations in the accompanying Condensed Consolidated
Financial Statements.


<P align="left" style="font-size: 10pt">Accordingly, certain reclassifications have been made in prior years to reflect
discontinued operations consistent with current period presentation. The
following is a summary of income from discontinued operations for the periods
presented:


<DIV align="center">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="67%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="22%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">For the three months ended</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">For the six months ended</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">(unaudited)<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">(unaudited)<HR size="1" noshade></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-04<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-03<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-04<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-03<HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Rental income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1,476</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">8,990</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">4,061</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">21,211</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Operating and other expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(816</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(4,076</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(1,931</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(8,914</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Interest expense, net</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(52</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(578</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(213</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(1,168</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Minority interest expense</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(193</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(389</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Depreciation expense</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(1,132</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(125</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2,738</TD>
    <TD nowrap>)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Income from discontinued operations</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">608</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">3,011</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1,792</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">8,002</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>


<P align="left" style="font-size: 10pt">The Company&#146;s Condensed Consolidated Balance Sheets include other assets
(excluding net real estate) of $356 and $1,428, other liabilities of $613 and
$1,084 and mortgage notes payable of $0 and $29,155 as of June&nbsp;30, 2004 and
December&nbsp;31, 2003, respectively, relating to real estate assets sold or held
for sale. The estimated proceeds less anticipated costs to sell the real
estate asset held for sale as of June&nbsp;30, 2004 are greater than the carrying
value as of June&nbsp;30, 2004, and therefore no provision for possible loss was
recorded.



<P align="left" style="font-size: 10pt">8. &nbsp;&nbsp;&nbsp;<U>Segment Reporting</U>



<P align="left" style="font-size: 10pt">The Company&#146;s reportable operating segments include Established Communities,
Other Stabilized Communities, and Development/Redevelopment Communities.
Annually as of January 1st, the Company determines which of its communities
fall into each of these categories and maintains that classification throughout
the year for the purpose of reporting segment operations.


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><I>Established Communities </I>(also known as Same
Store Communities) are communities where a comparison
of operating results from the prior year to the current
year is meaningful, as these communities were owned and
had stabilized occupancy and operating expenses as of
the beginning of the prior year. For the year 2004,
the Established Communities are communities that had
stabilized occupancy and operating expenses as of
January&nbsp;1, 2003, are not conducting or planning to
conduct substantial redevelopment activities and are
not held for sale or planned for disposition within the
current year. A community is considered to have
stabilized occupancy at the earlier of (i)&nbsp;attainment
of 95% physical occupancy or (ii)&nbsp;the one-year
anniversary of completion of development or
redevelopment.
</TD>
</TR>
</TABLE>

<P align="center" style="font-size: 10pt">16
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">


</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><I>Other Stabilized Communities </I>includes all
other completed communities that have stabilized
occupancy, as defined above. Other Stabilized
Communities do not include communities that are
conducting or planning to conduct substantial
redevelopment activities within the current year.</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="8%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><I>Development/Redevelopment Communities</I>
consists of communities that are under construction and
have not received a final certificate of occupancy,
communities where substantial redevelopment is in
progress or is planned to begin during the current year
and communities under lease-up, that had not reached
stabilized occupancy, as defined above, as of January
1, 2004.</TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt">In addition, the Company owns land held for future development and has other
corporate assets that are not allocated to an operating segment.


<P align="left" style="font-size: 10pt">SFAS No.&nbsp;131, &#147;Disclosures about Segments of an Enterprise and Related
Information,&#148; requires that segment disclosures present the<br>measure(s) used by
the chief operating decision maker for purposes of assessing such segments&#146;
performance. The Company&#146;s chief operating decision maker is comprised of
several members of its executive management team who use Net Operating Income
(&#147;NOI&#148;) as the primary financial measure for Established and Other Stabilized
Communities. NOI is defined by the Company as total revenue less direct
property operating expenses, including property taxes, and excludes
corporate-level property management and other indirect operating expenses,
interest income and expense, general and administrative expense, equity in
income of unconsolidated entities, minority interest in consolidated
partnerships, venture partner interest in profit-sharing, depreciation expense,
cumulative effect of change in accounting principle, gain on sale of
communities and income from discontinued operations. Although the Company
considers NOI a useful measure of a community&#146;s or communities&#146; operating
performance, NOI should not be considered an alternative to net income or net
cash flow from operating activities, as determined in accordance with GAAP.


<P align="left" style="font-size: 10pt">The primary performance measure for communities under development or
redevelopment depends on the stage of completion. While under development,
management monitors actual construction costs against budgeted costs as well as
lease-up pace and rent levels compared to budget.

<P align="center" style="font-size: 10pt">17
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">The following table provides details of the Company&#146;s segment information as of
the dates specified. The segments are classified based on the individual
community&#146;s status as of the beginning of the given calendar year. Therefore,
each year the composition of communities within each business segment is
adjusted. Accordingly, the amounts between years are not directly comparable.
The accounting policies applicable to the operating segments described above
are the same as those described in Note 1, &#147;Organization and Significant
Accounting Policies.&#148;


<DIV align="center">
<TABLE style="font-size: 7pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="24%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="15">For the three months ended<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="15">For the six months ended<HR size="1" noshade></TD>
</TR>
<TR style="font-size: 7pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Total</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">% NOI change</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Gross</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Total</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">% NOI change</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Gross</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">revenue<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">NOI (1)<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">from prior year<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">real estate (2)<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">revenue<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">NOI (1)<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">from prior year<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">real estate (2)<HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><U>For the three and six months ended June
30, 2004</U></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD><DIV style="margin-left:20px; text-indent:-10px">&nbsp;
</DIV></TD>
    <TD colspan="32">&nbsp;</TD>
</TR>

<TR style="background: #eeeeee">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Established
</DIV></TD>
    <TD colspan="32">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Northeast</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">37,167</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">25,363</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(0.8</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">914,298</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">73,394</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">48,840</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(3.0</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">914,298</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Mid-Atlantic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">16,124</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11,328</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">3.9</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">353,821</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">31,888</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">22,390</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">3.0</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">353,821</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Midwest</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,682</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,547</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">1.7</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">90,665</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,341</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,120</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.0</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">90,665</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Pacific Northwest</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,915</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,924</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">2.9</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">346,730</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">15,776</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9,901</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">0.7</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">346,730</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Northern California</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33,234</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">23,218</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(6.5</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,343,334</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">66,516</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">46,598</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(8.1</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,343,334</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Southern California</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">14,436</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,197</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">3.0</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">415,537</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">28,894</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">20,446</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">1.6</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">415,537</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Total Established</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">111,558</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">76,577</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(1.2</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,464,385</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">221,809</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">151,295</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2.8</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,464,385</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Other Stabilized</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">28,703</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,651</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,030,262</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">56,644</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">37,065</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,030,262</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Development / Redevelopment</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,856</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">13,116</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">953,213</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">40,369</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">23,313</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">953,213</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Land Held for Future Development</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">102,418</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">102,418</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Non-allocated (3)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">141</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">141</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">20,784</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">315</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">315</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">20,784</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Total</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">162,258</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">108,485</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">8.6</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">5,571,062</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">319,137</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">211,988</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.2</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">5,571,062</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><U>For the three and six months ended June
30, 2003</U></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>


<TR>
    <TD><DIV style="margin-left:20px; text-indent:-10px">Established
</DIV></TD>
    <TD colspan="32">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Northeast</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">38,391</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">25,935</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(7.0</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">883,446</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">76,390</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">51,132</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(9.9</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">883,446</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Mid-Atlantic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,321</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,105</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(4.8</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">388,026</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">34,410</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">24,113</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(6.8</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">388,026</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Midwest</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,013</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,248</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(14.5</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">140,369</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,112</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,345</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(17.4</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">140,369</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Pacific Northwest</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,773</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,107</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(15.8</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">297,297</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">13,656</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,498</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(14.8</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">297,297</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Northern California</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">35,215</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">25,134</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(12.3</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,340,610</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">71,116</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">51,380</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(12.7</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,340,610</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Southern California</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,719</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,374</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2.9</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">304,230</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,484</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">15,033</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(0.7</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">304,230</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Total Established</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">112,432</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">76,903</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(8.8</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,353,978</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">225,168</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">154,501</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(10.1</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,353,978</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Other Stabilized</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">19,300</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,847</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">713,002</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">38,259</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">25,410</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">713,002</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Development / Redevelopment</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,539</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,065</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">945,641</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33,467</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">19,289</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">945,641</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Land Held for Future Development</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">135,949</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">135,949</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Non-allocated (3)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">77</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">77</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">20,154</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">457</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">457</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">20,154</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Total</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">149,348</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">99,892</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(1.4</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">5,168,724</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">297,351</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">199,657</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2.5</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">5,168,724</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>




<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 7pt">

<TR valign="top">
    <TD width="1%" nowrap align="right">(1)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Does not include corporate-level property management and other indirect
operating expenses of $9,248 and $17,404 for the three and six months ended
June&nbsp;30, 2004, respectively, and $7,056 and $15,053 for the three and six
months ended June&nbsp;30, 2003, respectively.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(2)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Does not include gross real estate assets held for sale of $51,800 and
$221,515 as of June&nbsp;30, 2004 and June&nbsp;30, 2003, respectively.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(3)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Revenue and NOI amounts represent third-party management, accounting and
developer fees which are not allocated to a reportable segment.</TD>
</TR>

</TABLE>


<P align="left" style="font-size: 10pt">Segment information for the periods ending June&nbsp;30, 2004 and 2003 has been
adjusted for the communities that were designated as held for sale as of June
30, 2004 or sold from January&nbsp;1, 2003 through June&nbsp;30, 2004 as described in
Note 7, &#147;Discontinued Operations &#150; Real Estate Assets Sold or Held for Sale.&#148;

<P align="center" style="font-size: 10pt">18
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">




<P align="left" style="font-size: 10pt">9.&nbsp;&nbsp;&nbsp; <U>Related Party Arrangements</U>



<P align="left" style="font-size: 10pt"><I>Purchase of Mortgage Loan</I>


<P align="left" style="font-size: 10pt">Concurrent with its initial public offering in November&nbsp;1993, Avalon
Properties, Inc. (&#147;Avalon&#148;), a predecessor entity, purchased an existing
participating mortgage loan made to Arbor Commons Associates Limited
Partnership (&#147;Arbor Commons Associates&#148;), which owns Avalon Arbor, a 302
apartment home community in Shrewsbury, Massachusetts. Prior to May&nbsp;2004, the
Company&#146;s Chairman and CEO held an equity interest in Arbor Commons Associates.
In May&nbsp;2004, the Company&#146;s Chairman and CEO fully disposed of his equity
interests in Arbor Commons Associates. This mortgage loan accrues interest at
a fixed rate of 10.2% per annum, payable at 9.0% per annum, matures in November
2005 and is secured by the interest in Avalon Arbor. Under the terms of the
loan, the Company (as successor to Avalon) receives (as contingent interest)
50% of the cash flow after the 10.2% accrual rate is paid and 50% of the
residual profits upon the sale of the community. As of December&nbsp;31, 2003, the
Company reported a note receivable of $21,483 and accrued interest on the note
of $5,834. Related interest income for the three and six months ended June&nbsp;30,
2003 was $813 and $1,606, respectively. Beginning January&nbsp;1, 2004, the Company
consolidates the financial position and results of operations of Arbor Commons
Associates under the requirements of FIN 46 as discussed in Note 1,
&#147;Organization and Significant Accounting Policies.&#148; As such, the note
receivable, related accrued interest and interest income as of and for the six
months ended June&nbsp;30, 2004 have been eliminated in consolidation.


<P align="left" style="font-size: 10pt">During the six months ended June&nbsp;30, 2004, Arbor Commons Associates has been
unable to make its mortgage note payment on several occasions, resulting in a
default on the mortgage loan. The Company is currently negotiating to receive
either payment in full of the note or a deed-in-lieu of foreclosure. The
Company believes that the assets related to Arbor Commons Associates as
reflected on the Condensed Consolidated Balances Sheets as of June&nbsp;30, 2004 are
fully realizable.



<P align="left" style="font-size: 10pt"><I>Unconsolidated Entities</I>


<P align="left" style="font-size: 10pt">The Company manages several unconsolidated real estate joint venture entities
for which it receives management fee revenue. From these entities the Company
received management fee revenue of $181 and $351 in the three and six months
ended June&nbsp;30, 2004, respectively, and $228 and $465 in the three and six
months ended June&nbsp;30, 2003, respectively.



<P align="left" style="font-size: 10pt"><I>Director Compensation</I>


<P align="left" style="font-size: 10pt">The Company&#146;s 1994 Plan provides that directors of the Company who are also
employees receive no additional compensation for their services as a director.
In accordance with the Company&#146;s 1994 Plan, as then in effect, on the fifth
business day following the Company&#146;s May&nbsp;2003 Annual Meeting of Stockholders,
each of the Company&#146;s non-employee directors automatically received options to
purchase 7,000 shares of common stock at the last reported sale price of the
common stock on the NYSE on such date, and a restricted stock grant (or, in
lieu thereof, a deferred stock award) of 2,500 shares of common stock. On May
14, 2003, the Company&#146;s Board of Directors approved an amendment to the 1994
Plan pursuant to which, in lieu of the stock and option awards described above,
each non-employee director would receive, following the 2004 Annual Meeting of
Stockholders and each annual meeting thereafter, (i)&nbsp;a number of shares of
restricted stock (or deferred stock awards) having a value of $100 based on the
last reported sale price of the common stock on the NYSE on the fifth business
day following the prior year&#146;s annual meeting and (ii) $30 cash, payable in
quarterly installments of $7.5. A non-employee director may elect to receive
all or a portion of such cash payment in the form of a deferred stock award.
The Company recorded compensation expense relating to the restricted stock
grants, deferred stock awards and stock options in the amount of $226 and $456
in the three and six months ended June&nbsp;30, 2004, respectively, and $207 and
$367 in the three and six months ended June&nbsp;30, 2003, respectively. Deferred
compensation relating to these restricted stock grants, deferred stock awards
and stock options was $903 and $722 on June&nbsp;30, 2004 and December&nbsp;31, 2003,
respectively.

<P align="center" style="font-size: 10pt">19
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">




<P align="left" style="font-size: 10pt"><I>Investment in Realeum, Inc.</I>


<P align="left" style="font-size: 10pt">As an employee incentive and retention mechanism, the Company arranged for
officers of the Company to hold direct or indirect interests in the common
stock of Realeum, Inc (&#147;Realeum&#148;). Realeum is a company involved in the
development and deployment of a property management and leasing automation
system in which the Company invested $2,300 in January&nbsp;2002, but has a carrying
value of $0 as of June&nbsp;30, 2004. In April&nbsp;2004, Realeum was merged into a
third-party, and in connection with such merger, all shares of Realeum common
stock (including those held directly or indirectly by officers of the Company)
were cancelled without payment of consideration. The Company still utilizes
the property management and leasing automation system and has paid $124 and
$123 to Realeum under the terms of its licensing arrangements during the three
months ended June&nbsp;30, 2004 and 2003, respectively, and $268 and $223 for the
six months ended June&nbsp;30, 2004 and 2003, respectively.



<P align="left" style="font-size: 10pt">10.&nbsp;&nbsp;&nbsp; <U>Subsequent Events </U>


<P align="left" style="font-size: 10pt">Subsequent to June&nbsp;30, 2004, one community previously held for operating
purposes was classified as held for sale under SFAS No.&nbsp;144. This community
has a net real estate carrying value of $16,611 as of June&nbsp;30, 2004. The
Company is actively pursuing the disposition of this community and expects to
close during the last six months of 2004. In addition, the Company is no
longer pursuing the disposition of the one community that was held for sale as
of June&nbsp;30, 2004. Therefore, this community will be reclassified as held for
operating purposes at its carrying amount prior to being classified as held for
sale, adjusted for suspended depreciation, which is less than the current fair
value.


<P align="left" style="font-size: 10pt">In July&nbsp;2004, the Company acquired Briarcliffe Lakeside Apartments, located in
Chicago, Illinois. This garden-style community contains 204 apartment homes
and was acquired for an acquisition price of $14,200, which includes the
assumption of $8,155 of fixed rate mortgage debt.


<P align="left" style="font-size: 10pt">Also in July&nbsp;2004, the Company sold a parcel of land in connection with a
Development Right in Washington, DC for a gross sales price of $7,374,
resulting in a GAAP gain. In connection with this land sale, the Company sold
to the same buyer certain transferable development rights acquired with the
adjacent parcel of land on which a current operating community was developed,
for a sales price of $2,553. The Company received net proceeds of
approximately $9,648 as a result of this transaction.




<P align="center" style="font-size: 10pt">20
</DIV>


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<DIV style="font-family: 'Times New Roman',Times,serif">


<P>
<TABLE width="100%" border="0" cellpadding="2" cellspacing="0" style="font-size: 10pt; background: transparent; color: #000000">
<TR>
    <TD width="9%"></TD>
    <TD width="91%"></TD>
</TR>
<TR valign="top">
    <TD><B>ITEM 2.</B> </TD>
    <TD><B>MANAGEMENT&#146;S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS</B></TD>
</TR>
</TABLE>

<P align="left" style="font-size: 10pt">We are a real estate investment trust, or REIT, incorporated in the state of
Maryland and focused on the ownership and operation of apartment communities in
high barrier-to-entry markets of the United States. As of July&nbsp;30, 2004, we
had 134 current operating communities, which are the primary contributors to
our overall operating performance. The net operating income of these
communities, which is one of the financial measures that we use to evaluate
community performance, is affected by the demand and supply dynamics within our
markets, our rental rates and occupancy levels, and our ability to control
operating costs. Our overall operating performance is also impacted by the
general availability and cost of capital and the performance of our newly
developed and acquired apartment communities. We seek to create long-term
shareholder value by accessing capital on cost effective terms, deploying that
capital to develop, redevelop and acquire apartment communities in high
barrier-to-entry markets, operating apartments and selling communities when
they no longer meet our long-term investment strategy and when
pricing is attractive.


<P align="left" style="font-size: 10pt">This Form 10-Q, including the following discussion and analysis of our
financial condition and results of operations, contains forward-looking
statements that predict or indicate future events and trends that do not report
historical matters. Actual results or developments could differ materially
from those projected in such statements as a result of the risk factors set
forth on page 47 of this report. The following discussion and analysis of our
financial condition and results of operations should be read in conjunction
with our Condensed Consolidated Financial Statements and notes included
elsewhere in this report.


<P align="left" style="font-size: 10pt"><U>Business Description and Community Information Overview</U>


<P align="left" style="font-size: 10pt">We believe that apartment communities present an attractive long-term
investment opportunity compared to other real estate investments because a
broad potential resident base should result in relatively stable demand over a
real estate cycle. We intend to continue to pursue real estate investments in
markets where constraints to new supply exist, and where new household
formations are expected to out-pace multifamily permit activity over the course
of the real estate cycle. Barriers-to-entry in our markets generally include a
difficult and lengthy entitlement process with local jurisdictions and dense
urban or suburban areas where zoned and entitled land is in limited supply. We
regularly evaluate and monitor the allocation of our investments by the amount
of invested capital and by product type within our individual markets, which
are located in the Northeast, Mid-Atlantic, Midwest, Pacific Northwest, and
Northern and Southern California regions of the United States. Our strategy is
to more deeply penetrate these markets with a broad range of products and
services, with an intense focus on our customer. A substantial majority of our
current communities are upscale, which generally command among the highest
rents in their markets. We also pursue the ownership and operation of
apartment communities that target a variety of customer segments and price
points, consistent with our goal of offering a broad range of products and
services. We believe that, over an entire business cycle, lower housing
affordability and the limited new supply of apartment homes in our markets will
result in a higher propensity to rent and larger increases in cash flows
relative to other markets.


<P align="left" style="font-size: 10pt">However, we believe we are at the end of a period of the business cycle where
rents have been resetting to lower levels, which resulted in a decline in cash
flows in recent years. A number of our markets experienced economic
contraction due to job losses in 2002 and 2003, particularly in the technology,
telecom and financial services sectors. This resulted in a prolonged period of
weak apartment market fundamentals as reflected in declining rental rates and
demand. However, the rate of decline has been diminishing, and 2004 appears to
be a year of transition where apartment fundamentals become balanced in our
markets, creating a platform for future growth. In the first half of 2004, the
economy has shown signs of recovery as evidenced by stronger job growth and
declining unemployment claims. Continued improvement in the economic
environment should result in the stabilization of apartment market fundamentals
and an improved demand and supply balance during the remainder of the year. We
are beginning to experience the initial signs of improving apartment market
fundamentals as reflected in increasing economic occupancy, decreasing
availability of apartment homes and relatively flat market rents. Our
Established Community portfolio achieved sequential monthly revenue growth in
each of the five



<P align="center" style="font-size: 10pt">21
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">months ended June&nbsp;30, 2004, providing further evidence of
economic recovery. Occupancy is currently above 95%, which is generally a
point at which we can regain pricing power. Therefore, we expect declines in
rental revenue for these communities to be modest for the full year of 2004
as compared to 2003 and to significantly diminish from the declines experienced last year.


<P align="left" style="font-size: 10pt">In response to transitioning apartment fundamentals, we are adjusting our
business activity to position for the next expansionary cycle. We are
continuing our disposition activity, although at a reduced level as compared to
2003, and are increasing our development and acquisition volume in anticipation
of stronger apartment demand and in anticipation of locating communities where
we will be able to use our redevelopment and operating expertise to generate
high returns. However, the level of development and acquisition volume, or
disposition activity, will be heavily influenced by capital and real estate
market conditions, as well as apartment community demand.


<P align="left" style="font-size: 10pt">Our real estate investments consist primarily of current operating apartment
communities, communities in various stages of development (&#147;Development
Communities&#148;) and Development Rights as defined below. Our current operating
communities are further distinguished as Established Communities, Other
Stabilized Communities, Lease-Up Communities and Redevelopment Communities.
The following is a description of each category:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Current Communities</U> are categorized as Established, Other
Stabilized, Lease-Up, or Redevelopment according to the following
attributes:</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><I>Established Communities </I>(also known as Same
Store Communities) are communities where a comparison
of operating results from the prior year to the
current year is meaningful, as these communities were
owned and had stabilized occupancy and operating
expenses as of the beginning of the prior year. We
determine which of our communities fall into the
Established Communities category as of January 1st of
each year and maintain that classification throughout
the year, unless a community is subsequently planned
for disposition. For the year 2004, the Established
Communities are communities that had stabilized
occupancy and operating expenses as of January&nbsp;1, 2003
and are not conducting or planning to conduct
substantial redevelopment activities, as described
below, and are not held for sale or planned for
disposition within the current year. We consider a
community to have stabilized occupancy at the earlier
of (i)&nbsp;attainment of 95% physical occupancy or (ii)
the one-year anniversary of completion of development
or redevelopment.</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><I>Other Stabilized Communities </I>includes all
other completed communities that have stabilized
occupancy, as defined above. Other Stabilized
Communities do not include communities that are
conducting or planning to conduct substantial
redevelopment activities within the current year.</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><I>Lease-Up Communities </I>are communities where
construction has been complete for less than one year
and where physical occupancy has not reached 95%.</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><I>Redevelopment Communities </I>are communities
where substantial redevelopment is in progress or is
planned to begin during the current year.
Redevelopment is considered substantial when capital
invested during the reconstruction effort exceeds the
lesser of $5,000,000 or 10% of the community&#146;s
acquisition cost. Throughout this report, the term
&#147;redevelopment&#148; is used to refer to the entire
redevelopment cycle, including planning and
procurement of architectural and engineering designs,
budgeting and actual renovation work. The actual
renovation work</TD>
</TR>


</TABLE>

<P align="center" style="font-size: 10pt">22
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<P><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>is referred to as &#147;reconstruction,&#148;
which is only one element of the redevelopment cycle.</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Development Communities</U> are communities that are under
construction and for which a final certificate of occupancy has
not been received. These communities may be partially complete
and operating. Throughout this report, the term &#147;development&#148; is
used to refer to the entire property development cycle, including
pursuit of zoning approvals, procurement of architectural and
engineering designs and the construction process. References to
&#147;construction&#148; refer only to the actual construction of the
property, which is only one element of the development cycle.</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD><U>Development Rights</U> are development opportunities in the
early phase of the development process for which we either have an
option to acquire land or enter into a leasehold interest, for
which we are the buyer under a long-term conditional contract to
purchase land or where we own land to develop a new community. We
capitalize related pre-development costs incurred in pursuit of
new developments for which we currently believe future development
is probable.</TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt">A more detailed description of our reportable segments and other related
operating information can be found in Note 8, &#147;Segment Reporting,&#148; of
our Condensed Consolidated Financial Statements. Although each of these
categories is important to our business, we generally evaluate overall
operating, industry and market trends based on the operating results of
our Established Communities, for which a detailed discussion can be
found in &#147;Results of Operations&#148; as part of our discussion of overall
operating results. We evaluate our current and future cash needs and
future operating potential based on acquisition, disposition,
development, redevelopment and financing activities within Other
Stabilized, Redevelopment and Development Communities, for which
detailed discussions can be found in &#147;Liquidity and Capital Resources.&#148;




<P align="center" style="font-size: 10pt">23
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">On June&nbsp;30, 2004, we owned or had an ownership interest in these categories as
follows:


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="85%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="75%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Number of</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Number of</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">communities<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">apartment homes<HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><U>Current Communities</U></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Established Communities:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Northeast</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">28</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,215</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Mid-Atlantic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">16</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,156</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Midwest</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">887</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Pacific Northwest</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,738</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Northern California</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">28</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,491</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Southern California</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,046</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Total Established</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">98</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">27,533</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Other Stabilized Communities:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Northeast</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">20</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,732</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Mid-Atlantic</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,064</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Midwest</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">409</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Pacific Northwest</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Northern California</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,077</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Southern California</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">728</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Total Other Stabilized</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,010</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Lease-Up Communities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">203</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Redevelopment Communities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">781</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Total Current Communities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">133</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">38,527</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><U>Development Communities</U></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">14</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,149</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><U>Development Rights</U></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">40</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,728</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>


<P align="left" style="font-size: 10pt">In July&nbsp;2004 we acquired one community containing 204 apartment homes. As of
July&nbsp;30, 2004 our 134 current communities consisted of 38,731 apartment homes.
Of those communities, we owned:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>a fee simple, or absolute, ownership interest in 110
operating communities, four of which are on land subject to
land leases expiring in January&nbsp;2062, April&nbsp;2095, May&nbsp;2099
and March&nbsp;2142;</TD>
</TR>

</TABLE>


<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>a general partnership interest in three partnerships
that each own a fee simple interest in an operating
community;</TD>
</TR>

</TABLE>


<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>a general partnership interest in five partnerships
structured as &#147;DownREITs,&#148; as described more fully below,
that own an aggregate of 16 communities;</TD>
</TR>

</TABLE>


<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>a membership interest in four limited liability
companies that each hold a fee simple interest in an
operating community, two of which are on land subject to land
leases with one lease expiring in July&nbsp;2029 and one lease
expiring in November&nbsp;2089; and</TD>
</TR>

</TABLE>


<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>a 100% interest in a senior participating mortgage
note secured by one community, which allows us to share in
part of the rental income or resale proceeds of the
community.</TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt">We also hold a fee simple ownership interest in twelve of the Development
Communities, two of which will be subject to joint venture ownership structures
upon construction completion, in addition to a membership interest in a limited
liability company that owns one Development Community subject to a land lease
and a general partnership interest in a partnership structured as a &#147;DownREIT&#148;
that owns one Development Community.

<P align="center" style="font-size: 10pt">24
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">In each of our six partnerships structured as DownREITs, either AvalonBay or
one of our wholly-owned subsidiaries is the general partner, and there are one
or more limited partners whose interest in the partnership is represented by
units of limited partnership interest. For each DownREIT partnership, limited
partners are entitled to receive an initial distribution before any
distribution is made to the general partner. Although the partnership
agreements for each of the DownREITs are different, generally the distributions
per unit paid to the holders of units of limited partnership interests have
approximated our current common stock dividend amount. Each DownREIT
partnership has been structured so that it is unlikely the limited partners
will be entitled to a distribution greater than the initial distribution
provided for in the applicable partnership agreement. The holders of units of
limited partnership interest have the right to present each unit of limited
partnership interest for redemption for cash equal to the fair market value of
a share of our common stock on the date of redemption. In lieu of a cash
redemption by the partnership, we may elect to acquire any unit presented for
redemption for one share of our common stock or for such cash amount. As of
July&nbsp;30, 2004, there were 573,360 DownREIT partnership units outstanding. The
DownREIT partnerships are consolidated for financial reporting purposes.


<P align="left" style="font-size: 10pt">We elected to be taxed as a REIT for federal income tax purposes for the year
ended December&nbsp;31, 1994 and we have not revoked that election. We were
incorporated under the laws of the State of California in 1978, and we were
reincorporated in the State of Maryland in July&nbsp;1995. Our principal executive
offices are located at 2900 Eisenhower Avenue, Suite&nbsp;300, Alexandria, Virginia,
22314, and our telephone number at that location is (703)&nbsp;329-6300. We also
maintain regional offices and administrative or specialty offices in or near
the following cities:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Boston, Massachusetts;</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Chicago, Illinois;</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>New Canaan, Connecticut;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>New York, New York;</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Newport Beach, California;</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>San Jose, California;</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Seattle, Washington; and</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Woodbridge, New Jersey.</TD>
</TR>

</TABLE>


<P align="left" style="font-size: 10pt"><U>Recent Developments</U>


<P align="left" style="font-size: 10pt"><I>Development Activities</I>. During the three months ended June&nbsp;30, 2004, we
commenced development of three communities, Avalon at Juanita Village, located
in Seattle, Washington, and Avalon Del Rey and Avalon Camarillo, both located
in the Los Angeles, California area. These communities, when completed are
expected to contain an aggregate of 769 apartment homes for a total capitalized
cost of $158,200,000. Both Avalon at Juanita Village and Avalon Del Rey will
be subject to joint venture ownership structures upon construction completion,
as further described in &#147;Liquidity and Capital Resources&#148; located elsewhere in
this report.


<P align="left" style="font-size: 10pt">The development and redevelopment of communities involves risks that the
investment will fail to perform in accordance with our expectations. See
&#147;Risks of Development and Redevelopment&#148; for our discussion of these and other
risks inherent in developing or redeveloping communities.


<P align="left" style="font-size: 10pt"><I>Acquisition Activities. </I>During the three months ended June&nbsp;30, 2004, we
acquired one community, Avalon at Redondo Beach, located in Los Angeles,
California. This garden-style community contains 105 apartment homes and was
acquired for an acquisition price of $24,065,000.


<P align="left" style="font-size: 10pt"><I>Disposition Activities. </I>During the three months ended June&nbsp;30, 2004, we sold
two communities, Avalon Greenbriar, located in Seattle, Washington, and Avalon
at Laguna Niguel, located in Orange County, California. These two communities,
which contained a total of 597 apartment homes, were sold for an aggregate
sales price of $61,100,000, including the transfer of $18,755,000 of variable
rate, tax-exempt debt, for net proceeds of $40,909,000. In addition, variable
rate, tax-exempt debt of $10,400,000 was repaid immediately prior to the sale
of one of these communities.


<P align="center" style="font-size: 10pt">25
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<P align="left" style="font-size: 10pt"><U>Critical Accounting Policies</U>


<P align="left" style="font-size: 10pt">The preparation of financial statements in conformity with generally accepted
accounting principles (&#147;GAAP&#148;) requires management to use judgment in the
application of accounting policies, including making estimates and assumptions.
If our judgment or interpretation of the facts and circumstances relating to
various transactions had been different, or different estimates or assumptions
would have been made, it is possible that different accounting policies would
have been applied, resulting in different financial results or a different
presentation of our financial statements. Below is a discussion of accounting
policies that we consider critical, in that they may require complex judgment
in their application or require estimates about matters which are inherently
uncertain, and are critical to an understanding of our financial condition and
operating results. As a REIT that owns, operates and develops apartment
communities, our critical accounting policies relate to revenue recognition,
cost capitalization, asset impairment evaluation and REIT status. A discussion
of all of our accounting policies, including further discussion of the critical
accounting policies described below, can be found in Note 1, &#147;Organization and
Significant Accounting Policies&#148; of our Condensed Consolidated Financial
Statements.


<P align="left" style="font-size: 10pt"><I>Revenue Recognition</I>



<P align="left" style="font-size: 10pt">Rental income related to leases is recognized on an accrual basis when due from
residents in accordance with SEC Staff Accounting Bulletin No.&nbsp;104, &#147;Revenue
Recognition&#148; and Statement of Financial Accounting Standards No.&nbsp;13,
&#147;Accounting for Leases.&#148; In accordance with our standard lease terms, rental
payments are generally due on a monthly basis. Any cash concessions given at
the inception of the lease are amortized over the approximate life of the lease
&#150; generally one year. A discussion regarding the impact of cash concessions on
rental revenue for Established Communities can be found in &#147;Results of
Operations.&#148;


<P align="left" style="font-size: 10pt"><I>Cost Capitalization</I>



<P align="left" style="font-size: 10pt">We capitalize costs during the development of assets (including interest and
related loan fees, property taxes and other direct and indirect costs)
beginning when active development commences until the asset, or a portion of
the asset, is delivered and is ready for its intended use, which is generally
indicated by the issuance of a certificate of occupancy. We capitalize costs
during redevelopment of apartment homes (including interest and related loan
fees, property taxes and other direct and indirect costs) beginning when an
apartment home is taken out-of-service for redevelopment until the apartment
home redevelopment is completed and the apartment home is available for a new
resident.


<P align="left" style="font-size: 10pt">We capitalize pre-development costs incurred in pursuit of Development Rights
for which we currently believe future development is probable. These costs
include legal fees, design fees and related overhead costs. Future development
of these Development Rights is dependent upon various factors, including zoning
and regulatory approval, rental market conditions, construction costs and
availability of capital. Pre-development costs incurred in the pursuit of
Development Rights for which future development is not yet considered probable
are expensed as incurred. In addition, if the status of a Development Right
changes, deeming future development no longer probable, any capitalized
pre-development costs are written-off with a charge to expense.


<P align="left" style="font-size: 10pt">We generally capitalize only non-recurring expenditures. We capitalize
improvements and upgrades only if the item: (i)&nbsp;exceeds $15,000; (ii)&nbsp;extends
the useful life of the asset; and (iii)&nbsp;is not related to making an apartment
home ready for the next resident. Under this policy, virtually all capitalized
costs are non-recurring, as recurring make-ready costs are expensed as
incurred. Recurring make-ready costs include: (i)&nbsp;carpet and appliance
replacements; (ii)&nbsp;floor coverings; (iii)&nbsp;interior painting; and (iv)&nbsp;other
redecorating costs. Because we expense carpet replacements, our expense levels
and volatility are greatest in the third quarter of each year as this is when
we experience our greatest amount of turnover. We capitalize purchases of
personal property, such as computers and furniture, only if the item is a new
addition and the


<P align="center" style="font-size: 10pt">26
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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt">item exceeds $2,500. We generally expense replacements of
personal property. For Established and Other Stabilized Communities, we
recorded non-revenue generating capital expenditures of $160 per apartment home
in the six months ended June&nbsp;30, 2004 and $140 per apartment home in the six
months ended June&nbsp;30, 2003. The average maintenance costs charged to expense
per apartment home, including carpet and appliance replacements, related to
these communities was $667 in the six months ended June&nbsp;30, 2004 and $605 in
the six months ended June&nbsp;30, 2003. We anticipate that capitalized costs and
expensed maintenance costs per apartment home will gradually increase as the
average age of our communities increases, and expensed maintenance costs will
fluctuate with turnover.


<P align="left" style="font-size: 10pt"><I>Asset Impairment Evaluation</I>



<P align="left" style="font-size: 10pt">If there is an event or change in circumstance that indicates an impairment in
the value of a community, our policy is to assess the impairment by making a
comparison of the current and projected operating cash flows of the community
over its remaining useful life, on an undiscounted basis, to the carrying
amount of the community. If the carrying amount is in excess of the estimated
projected operating cash flows of the community, we would recognize an
impairment loss equivalent to an amount required to adjust the carrying amount
to its estimated fair market value. Real estate assets held for sale are
measured at the lower of the carrying amount or the fair value less the cost to
sell.


<P align="left" style="font-size: 10pt">We account for our investments in technology companies in accordance with
Accounting Principles Board (&#147;APB&#148;) Opinion No.&nbsp;18, &#147;The Equity Method of
Accounting for Investments in Common Stock.&#148; If there is an event or change in
circumstance that indicates a loss in the value of an investment, we record the
loss and reduce the value of the investment to its fair value. Due to the
nature of these investments, an impairment in value can be difficult to
determine.


<P align="left" style="font-size: 10pt"><I>REIT Status</I>



<P align="left" style="font-size: 10pt">A corporate REIT is a legal entity which holds real estate interests and must
meet a number of organizational and operational requirements, including a
requirement that it currently distribute at least 90% of its adjusted taxable
income to stockholders. As a REIT, we generally will not be subject to
corporate level federal income tax on taxable income we distribute currently to
our stockholders. If we fail to qualify as a REIT in any taxable year, we will
be subject to federal income taxes at regular corporate rates (including any
applicable alternative minimum tax) and may not be able to qualify as a REIT
for four subsequent taxable years.


<P align="center" style="font-size: 10pt">27
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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt"><U>Results of Operations</U>


<P align="left" style="font-size: 10pt">Our year-over-year operating performance is primarily affected by changes in
net operating income of our current operating apartment communities due to
market conditions, net operating income derived from acquisitions and
development completions, the loss of net operating income related to disposed
communities and capital market, disposition and financing activity. A
comparison of our operating results for the three and six months ended June&nbsp;30,
2004 and 2003 follows (dollars in thousands):

<DIV align="center">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="34%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="15"><B>For the three months ended</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="15"><B>For the six months ended</B><HR size="1" noshade></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>6-30-04</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>6-30-03</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>$ Change</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>% Change</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>6-30-04</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>6-30-03</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>$ Change</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>% Change</B><HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Revenue:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:20px; text-indent:-10px">Rental and other income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">162,101</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">149,101</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">13,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">8.7</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">318,832</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">296,840</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">21,992</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.4</TD>
    <TD nowrap>%</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Management, development and other fees</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">157</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">247</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(90</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(36.4</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">305</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">511</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(206</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(40.3</TD>
    <TD nowrap>%)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Total revenue</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">162,258</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">149,348</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,910</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">8.6</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">319,137</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">297,351</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,786</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.3</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Expenses:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Direct property operating expenses,
excluding property taxes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">38,718</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">35,495</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,223</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">9.1</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">76,520</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">69,553</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,967</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">10.0</TD>
    <TD nowrap>%</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Property taxes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">15,055</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">13,961</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,094</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.8</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">30,629</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">28,141</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,488</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">8.8</TD>
    <TD nowrap>%</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Total community operating expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">53,773</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">49,456</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,317</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">8.7</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">107,149</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">97,694</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9,455</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">9.7</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Net operating income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">108,485</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">99,892</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,593</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">8.6</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">211,988</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">199,657</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,331</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.2</TD>
    <TD nowrap>%</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Corporate-level property management
and other indirect operating expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9,248</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,056</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,192</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">31.1</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,404</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">15,053</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,351</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">15.6</TD>
    <TD nowrap>%</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Interest expense</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">32,482</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">34,067</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(1,585</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(4.7</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">64,768</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">68,041</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(3,273</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(4.8</TD>
    <TD nowrap>%)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Depreciation expense</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">40,173</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">37,053</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,120</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">8.4</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">79,745</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">73,723</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,022</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">8.2</TD>
    <TD nowrap>%</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:30px; text-indent:-10px">General and administrative expense</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,071</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,623</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">448</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">12.4</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,041</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,254</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">787</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">10.8</TD>
    <TD nowrap>%</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Total other expenses</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">85,974</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">81,799</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,175</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">5.1</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">169,958</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">164,071</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,887</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">3.6</TD>
    <TD nowrap>%</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Equity in income of unconsolidated entities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">276</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">677</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(401</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(59.2</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">463</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,205</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(742</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(61.6</TD>
    <TD nowrap>%)</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Interest income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">36</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">880</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(844</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(95.9</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">56</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,782</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(1,726</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(96.9</TD>
    <TD nowrap>%)</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Venture partner interest in profit-sharing</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(352</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(470</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">118</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(25.1</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(677</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(848</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">171</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(20.2</TD>
    <TD nowrap>%)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Minority interest in consolidated partnerships</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(420</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(234</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(186</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">79.5</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(275</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(454</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">179</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(39.4</TD>
    <TD nowrap>%)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Income from continuing operations before
cumulative effect of change in accounting principle</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">22,051</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,946</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,105</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">16.4</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">41,597</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">37,271</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,326</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">11.6</TD>
    <TD nowrap>%</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Discontinued operations:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>


<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Income from discontinued operations</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">608</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,011</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2,403</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(79.8</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,792</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,002</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(6,210</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(77.6</TD>
    <TD nowrap>%)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px">Gain on sale of communities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,375</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">54,511</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(42,136</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(77.3</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,375</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">68,583</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(56,208</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(82.0</TD>
    <TD nowrap>%)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Total discontinued operations</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,983</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">57,522</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(44,539</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(77.4</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">14,167</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">76,585</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(62,418</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(81.5</TD>
    <TD nowrap>%)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Income before cumulative effect of change
in accounting principle</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">35,034</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">76,468</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(41,434</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(54.2</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">55,764</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">113,856</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(58,092</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(51.0</TD>
    <TD nowrap>%)</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Cumulative effect of change in
accounting principle</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,547</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,547</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">100.0</TD>
    <TD nowrap>%</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Net income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">35,034</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">76,468</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(41,434</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(54.2</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">60,311</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">113,856</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(53,545</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(47.0</TD>
    <TD nowrap>%)</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Dividends attributable to preferred stock</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2,175</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2,706</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">531</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(19.6</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(4,350</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(6,394</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,044</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(32.0</TD>
    <TD nowrap>%)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Net income available to common stockholders</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">32,859</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">73,762</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">(40,903</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(55.5</TD>
    <TD nowrap>%)</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">55,961</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">107,462</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">(51,501</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(47.9</TD>
    <TD nowrap>%)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>


<P align="left" style="font-size: 10pt"><I>Net income available to common stockholders </I>decreased $40,903,000, or 55.5%, to
$32,859,000 for the three months ended June&nbsp;30, 2004 and decreased by
$51,501,000 or 47.9% to $55,961,000 for the six months ended June&nbsp;30, 2004
compared to the same periods in the preceding year. These decreases are
primarily attributable to lower gains on sale of communities recognized in 2004
as compared to 2003, due to reduced disposition activity.


<P align="left" style="font-size: 10pt"><I>Net operating income (&#147;NOI&#148;) </I>is defined by us as total revenue less direct
property operating expenses, including property taxes, and excludes
corporate-level property management and other indirect operating expenses,
interest income and expense, general and administrative expense, equity in
income of unconsolidated entities, minority interest in consolidated
partnerships, venture partner interest in profit-sharing, depreciation expense,
gain on sale of communities, cumulative effect of change in accounting
principle and income from discontinued operations. We believe that NOI is an
important and appropriate supplemental measure to net income of the operating
performance of our communities because it helps both investors and management
to understand the core operations of a community or communities prior to the
allocation of any corporate-level or financing-related costs. This is more
reflective of the operating performance of a community, and allows for an
easier comparison of the operating performance of




<P align="center" style="font-size: 10pt">28
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">individual assets or groups
of assets. In addition, because prospective buyers of real estate have
different overhead structures, with varying marginal impact to overhead by
acquiring real estate, NOI is considered by many in the real estate industry to
be a useful measure for determining the value of a real estate asset or group
of assets. NOI does not represent cash generated from operating activities in
accordance with GAAP. Therefore, NOI should not be considered an alternative
to net income as an indication of our performance. NOI should also not be
considered an alternative to net cash flows from operating activities, as
determined by GAAP, as a measure of liquidity, nor is NOI necessarily
indicative of cash available to fund cash needs. A calculation of NOI for the
three and six months ending June&nbsp;30, 2004 and 2003, along with a reconciliation
to net income, is provided in the preceding table.


<P align="left" style="font-size: 10pt">The NOI increases of $8,593,000 and $12,331,000 for the three and six months
ended June&nbsp;30, 2004, respectively, as compared to the prior year periods
consists of changes in the following categories:


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="75%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="43%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">2004 NOI Increase (Decrease)<HR size="1" noshade></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">For the three months ended</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">For the six months ended</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-04<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-04<HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Established Communities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">(921,000</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">(4,385,000</TD>
    <TD nowrap>)</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Other Stabilized Communities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,969,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,885,000</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Development and Redevelopment Communities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,481,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,973,000</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Non-allocated</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">64,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(142,000</TD>
    <TD nowrap>)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Total</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">8,593,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">12,331,000</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>


<P align="left" style="font-size: 10pt">The NOI decreases in Established Communities were largely due to the effects of
the weakened economy in many of our markets. The continued impact of
historical job losses in many of our markets, in addition to strong
single-family home sales, have aggravated a weak demand environment, causing
market rental rates to decline. However, we have experienced stronger job
growth and declining unemployment claims in our markets during the six months
ended June&nbsp;30, 2004, suggesting the beginning of an economic recovery.
Although the recent acceleration of job growth will help stabilize apartment
fundamentals during the year, we expect modest year over year declines in our
Established Communities NOI for 2004. We have reached 95% occupancy, a point
at which we generally regain pricing power, and we are therefore
beginning to test
revenue growth through modest rental rate increases and/or reduction in
concessions. This, combined with aggressively managing operating expenses,
should allow us to mitigate declines in NOI.


<P align="left" style="font-size: 10pt"><I>Rental and other income </I>increased in the three and six months ended June&nbsp;30,
2004 as compared to the prior year periods due to rental income generated from
newly developed communities and increased occupancy, partially offset by
declines in effective rental rates.



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Overall Portfolio &#150; The weighted average number of occupied apartment
homes increased to 35,400 apartment homes for the six months ended June
30, 2004 as compared to 32,559 apartment homes for the six months ended
June&nbsp;30, 2003. This change is primarily the result of increased homes
available from newly developed communities and an increase in the
overall occupancy rate, partially offset by communities sold in 2003
and 2004.
The weighted average monthly revenue per occupied apartment home
decreased to $1,498 in the six months ended June&nbsp;30, 2004 as compared to
$1,518 in the six months ended June&nbsp;30, 2003, primarily due to the high
concessionary environment being experienced in certain of our markets.</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Established Communities &#150; Rental revenue decreased $852,000, or 0.8%, in
the three months ended June&nbsp;30, 2004 as compared to the same period of
2003. Rental revenue decreased $3,302,000, or 1.5%, in the six months
ended June&nbsp;30, 2004 as compared to the same period of 2003. These
decreases are due to declining effective rental rates, partially offset
by an increase in economic occupancy during both the three and six
months ended June&nbsp;30, 2004. For the six months ended June&nbsp;30, 2004, the
weighted average monthly revenue per occupied apartment home decreased
2.4% to $1,418 compared to $1,453 for the six months ended June&nbsp;30,
2003, partially due to increased concessions granted throughout 2003 and
into 2004. The average economic</TD>
</TR>


</TABLE>

<P align="center" style="font-size: 10pt">29
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<DIV style="font-family: 'Times New Roman',Times,serif">


<P><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&nbsp;&nbsp;&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>occupancy increased from 93.7% in the
six months ended June&nbsp;30, 2003 to 94.6% in the six months ended June&nbsp;30,
2004. Economic occupancy takes into account the fact that apartment
homes of different sizes and locations within a community have different
economic impacts on a community&#146;s gross revenue. Economic occupancy is
defined as gross potential revenue less vacancy loss, as a percentage of
gross potential revenue. Gross potential revenue is determined by
valuing occupied homes at leased rates and vacant homes at market rents.
Although, we expect rental income for Established Communities to
continue to reflect year over year declines throughout most of 2004 as
compared to 2003, we expect that the declines will moderate throughout
the year.</TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt">Although rental revenue from the Established Community portfolio as a whole
decreased in the six months ended June&nbsp;30, 2004 as compared to the same period
of 2003, we had increases in Established Communities&#146; rental revenue in four of
our six regions. The largest increase was in the Mid-Atlantic with an increase
in rental revenue of 2.9% between periods, reflecting a significant increase in
economic occupancy due to modest job growth and flat average rental rates. In
addition, in Southern California, we were able to increase average rental rates
by 1.1%, while maintaining an economic occupancy of 95.3%, resulting in an
increase in rental revenue of 1.3% between periods. The Midwest and Pacific
Northwest experienced increases in rental revenue of 0.8% and 0.5%,
respectively, during the six months ended June&nbsp;30, 2004 as compared to the same
period of 2003, reflecting increased economic occupancy partially offset by
declining average rental rates.


<P align="left" style="font-size: 10pt">However, our rental income from Established Communities was impacted by
continued declines in average rental rates in certain Northern California and
Northeast markets. Northern California, which accounted for approximately
30.0% of Established Community rental revenue during the six months ended June
30, 2004, experienced a decline in rental revenue of 5.1% in the six months
ended June&nbsp;30, 2004 as compared to the same period in 2003, partially related
to the continued impact of historical job losses in the technology sector.
Although economic occupancy in Northern California increased to 95.5% in the
six months ended June&nbsp;30, 2004, average rental rates dropped 5.4% to $1,367
from $1,445 during 2003. We expect rental revenue to decline slightly in
Northern California during the remainder of the year as the region continues to
stabilize.


<P align="left" style="font-size: 10pt">The Northeast region accounted for approximately 33.1% of Established Community
rental revenue during the six months ended June&nbsp;30, 2004 and experienced a
decline in rental revenue of 1.6% in the six months ended June&nbsp;30, 2004 as
compared to the same period of 2003, primarily due to the continued impact of
historical job losses in the financial services sector. Although economic
occupancy increased to 93.3% during the six months ended June&nbsp;30, 2004, average
rental rates dropped 2.1% to $1,815 from $1,854 in 2003. The Northeast region
appears to be stabilizing, and we expect rental revenue declines to diminish
during the remainder of 2004.


<P align="left" style="font-size: 10pt">In accordance with GAAP, cash concessions are amortized as an offset to rental
revenue over the approximate lease term, which is generally one year. However,
we consider rental revenue with concessions stated on a cash basis to be a
supplemental measure to rental revenue in conformity with GAAP in helping
investors to evaluate the impact of both current and historical concessions on
GAAP based rental revenue and to more readily enable comparisons to revenue as
reported by other companies. In addition, rental revenue with concessions
stated on a cash basis allows an investor to understand the historical trend in
cash concessions, which is an indicator of current rental market conditions.



<P align="center" style="font-size: 10pt">30
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">The following table reconciles total rental revenue in conformity with GAAP to
total rental revenue adjusted to state concessions on a cash basis for our
Established Communities for the three and six months ended June&nbsp;30, 2004 and
2003 (dollars in thousands).


<DIV align="center">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="95%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="60%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">For the three months ended<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">For the six months ended<HR size="1" noshade></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-04<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-03<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-04<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-03<HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Rental revenue (GAAP basis)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">111,489</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">112,341</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">221,683</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">224,985</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Concessions amortized</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,110</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2,958</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,949</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,638</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Concessions granted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(4,445</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(3,201</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(7,902</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(5,820</TD>
    <TD nowrap>)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Rental revenue adjusted to state
concessions on a cash basis</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">111,154</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">112,098</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">221,730</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">224,803</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Year-over-year % change &#151; GAAP revenue</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(0.8%</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(1.5%</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Year-over-year % change &#151; cash concession based revenue</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(0.8%</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(1.4%</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">n/a</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>


<P align="left" style="font-size: 10pt">Concessions granted per move-in for Established Communities averaged $1,101
during the three months ended June&nbsp;30, 2004, an increase of 39.7% from $788 in
the three months ended June&nbsp;30, 2003. This increase was primarily due to weak
demand/supply fundamentals in many of our markets. This high concessionary
environment will likely continue throughout the year.


<P align="left" style="font-size: 10pt"><I>Direct property operating expenses, excluding property taxes </I>increased in the
three and six months ended June&nbsp;30, 2004 due to the addition of recently
developed and redeveloped apartment homes, coupled with increased expenses due
to salary increases and leasing bonuses, as well as increased make-ready costs
associated with increasing occupancy.



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>For Established Communities, direct property operating expenses,
excluding property taxes, increased $429,000, or 1.7%, for the three
months ended June&nbsp;30, 2004 and $1,215,000, or 2.5%, for the six months
ended June&nbsp;30, 2004 as compared to the same periods of 2003 due to
increased salaries and leasing bonuses, as well as increased make-ready
costs associated with increasing occupancy. We expect expense growth to
continue to moderate in 2004 as we experience declines in the historical
high levels of property insurance costs and bad debt expenses with
changes in the insurance markets and the overall economy.</TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt"><I>Property taxes </I>increased in the three and six months ended June&nbsp;30, 2004 as
compared to the same periods of 2003 due to overall higher assessments and
the addition of newly developed and redeveloped apartment homes, partially
offset by a property tax refund.



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>For Established Communities, property taxes decreased by $352,000 and
$115,000 in the three and six months ended June&nbsp;30, 2004, respectively,
as compared to the same periods of 2003, due to the successful
resolution of a tax appeal for a community in the Northeast of
$661,000, partially
offset by overall higher assessments throughout all regions. We expect
property taxes to increase throughout 2004 as local jurisdictions look
for additional revenue sources to offset budget deficits. We manage
property tax increases internally, as well as engage third-party
consultants, and appeal increases when appropriate.</TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt"><I>Corporate-level property management and other indirect operating expenses</I>
increased in the three and six months ended June&nbsp;30, 2004 as compared to the
same periods of 2003 as a result of construction litigation relating to a
community that has completed development, litigation and settlement costs
associated with Proposition 65 signage requirements at our California
communities, increased compensation costs, and increased abandoned pursuit
costs. Abandoned pursuit costs increased $127,000 from $1,050,000 in the six
months ended June&nbsp;30, 2003 to $1,177,000 in the six months ended June&nbsp;30, 2004.
Abandoned pursuit costs can be volatile, and the increases reflected during
the six months ended June&nbsp;30, 2004 compared to the same period of the prior
year may not be experienced in future periods. We expect corporate-level
property management and other




<P align="center" style="font-size: 10pt">31
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<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">indirect operating expenses to increase during
the year due to the costs of managing a potential discretionary investment
management fund and increased legal costs relating to several ongoing lawsuits.


<P align="left" style="font-size: 10pt"><I>Interest expense </I>decreased in the three and six months ended June&nbsp;30, 2004 as
compared to the same periods of 2003 primarily due to the repayment of certain
unsecured notes and overall lower interest rates on both short-term and
long-term borrowings, partially offset by higher average outstanding balances
on our unsecured credit facility.


<P align="left" style="font-size: 10pt"><I>Depreciation expense</I> increased in the three and six months ended June&nbsp;30, 2004
as compared to the same periods of 2003 primarily due to the completion of
development and redevelopment activities.


<P align="left" style="font-size: 10pt"><I>General and administrative expense </I>(&#147;G&#038;A&#148;) increased in the three and six
months ended June&nbsp;30, 2004 as compared to the same periods of 2003 as a result
of higher compensation expense and additional corporate governance costs,
including costs relating to compliance with Sarbanes-Oxley. We expect G&#038;A to
continue to reflect year over year increases in 2004 due to increased corporate
governance and compensation costs, partially offset by a decrease in our directors and officers (&#147;D&#038;O&#148;)
insurance resulting from our March&nbsp;2004 renewal at a lower premium.


<P align="left" style="font-size: 10pt"><I>Equity in income of unconsolidated entities </I>decreased in the three and six
months ended June&nbsp;30, 2004 as compared to the same periods of 2003 primarily
due to the loss of income from a community accounted for under the equity
method in which we held a 50% interest, but which we sold in late 2003.


<P align="left" style="font-size: 10pt"><I>Interest income </I>decreased in the three and six months ended June&nbsp;30, 2004 as
compared to the same periods of 2003 due to lower average cash balances
invested and lower interest rates. In addition, effective January&nbsp;1, 2004, we
consolidated an entity in which we hold a participating mortgage note due to
the implementation of FASB Interpretation No.&nbsp;46 (&#147;FIN 46&#148;), &#147;Consolidation of
Variable Interest Entities, and Interpretation of ARB No.&nbsp;51,&#148; as revised in
December&nbsp;2003. Therefore, interest income that we recognized during the three
and six months ended June&nbsp;30, 2003 is not reflected during the three and six
months ended June&nbsp;30, 2004 as such amounts were eliminated in consolidation
(See Note 1, &#147;Organization and Significant Accounting Policies,&#148; of the
Condensed Consolidated Financial Statements.)


<P align="left" style="font-size: 10pt"><I>Income from discontinued operations </I>represents the net income generated by
communities held for sale as of June&nbsp;30, 2004 and communities sold during the
period from January&nbsp;1, 2003 through June&nbsp;30, 2004. The decreases in the three
and six months ended June&nbsp;30, 2004 as compared to the same periods of 2003 are
due to the sale of eleven communities in 2003 and two communities in 2004.


<P align="left" style="font-size: 10pt"><I>Gain on sale of communities </I>decreased in the three and six months ended June
30, 2004 as compared to the same periods of 2003 due to the reduced disposition
activity in 2004 as compared to the prior year. The amount of gains realized
depends on many factors, including the number of communities sold, the size and
carrying value of those communities and the market conditions in the local
area. We expect to sell fewer assets in 2004 as compared to 2003, which will
result in less aggregate gains on assets sold.


<P align="left" style="font-size: 10pt"><I>Cumulative effect of change in accounting principle </I>during the six months ended
June&nbsp;30, 2004 is a result of the implementation of FIN 46, discussed above, and
represents the difference between the net assets consolidated under FIN 46 and
the previously recorded net assets.


<P align="left" style="font-size: 10pt"><I>Dividends attributable to preferred stock </I>decreased during the three and six
months ended June&nbsp;30, 2004 as compared to the same periods of 2003 primarily as
a result of two preferred stock redemptions during the six months ended June
30, 2003. In addition, in response to the Securities and Exchange Commission
clarification of Emerging Issues Task Force (&#147;EITF&#148;) Topic D-42, &#147;The Effect on
the Calculation of Earnings per Share for the Redemption or Induced Conversion
of Preferred Stock,&#148; we have revised the presentation of our operating results
for the three and six months ended June&nbsp;30, 2003 to include the initial
offering costs of $280,000 as additional dividends.

<P align="center" style="font-size: 10pt">32
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt"><I>Funds from Operations attributable to common stockholders </I>(&#147;FFO&#148;) is considered
by management an appropriate supplemental measure of our operating and
financial performance because, by excluding gains or losses related to
dispositions of property and excluding real estate depreciation, which can vary
among owners of identical assets in similar condition based on historical cost
accounting and useful life estimates, FFO can help one compare the operating
performance of a real estate company between periods or as compared to
different companies. We believe that in order to understand our operating
results, FFO should be examined with net income as presented in the Condensed
Consolidated Statements of Operations and Other Comprehensive Income included
elsewhere in this report.


<P align="left" style="font-size: 10pt">Consistent with the definition adopted by the Board of Governors of the
National Association of Real Estate Investment Trusts&#174;, we calculate FFO as
net income or loss computed in accordance with GAAP, adjusted for:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>gains or losses on sales of property;</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>extraordinary gains or losses (as defined by GAAP);</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>cumulative effect of a change in accounting principle;</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>depreciation of real estate assets; and</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>adjustments for unconsolidated partnerships and joint ventures.</TD>
</TR>

</TABLE>


<P align="left" style="font-size: 10pt">FFO does not represent net income in accordance with GAAP, and therefore it
should not be considered an alternative to net income, which remains the
primary measure, as an indication of our performance. In addition, FFO as
calculated by other REITs may not be comparable to our calculation of FFO.
The following is a reconciliation of net income to FFO (dollars in thousands,
except per share data):

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="56%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">For the three months ended<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">For the six months ended<HR size="1" noshade></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-04<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-03<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-04<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-03<HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><u>Funds from Operations</u></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Net income</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">35,034</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">76,468</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">60,311</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">113,856</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Dividends attributable to preferred stock</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2,175</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(2,706</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(4,350</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(6,394</TD>
    <TD nowrap>)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Depreciation &#151; real estate assets, including discontinued
operations and joint venture adjustments</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39,054</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">37,523</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">77,551</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">75,069</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Minority interest expense, including discontinued operations</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">912</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">379</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,239</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">762</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Cumulative effect of change in accounting principle</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(4,547</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Gain on sale of communities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(12,375</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(54,511</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(12,375</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">(68,583</TD>
    <TD nowrap>)</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Funds from operations attributable to common stockholders</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">60,450</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">57,153</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">117,829</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">114,710</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Weighted average common shares outstanding &#151; diluted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">73,037,484</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">68,903,145</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">72,791,470</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">69,007,504</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">EPS per common share &#151; diluted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.46</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.08</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.79</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.57</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">FFO per common share &#151; diluted</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.83</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">0.83</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.62</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1.66</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

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</TABLE>
</DIV>


<P align="left" style="font-size: 10pt">FFO also does not represent cash generated from operating activities in
accordance with GAAP, and therefore should not be considered an alternative to
net cash flows from operating activities, as determined by GAAP, as a measure
of liquidity. Additionally, it is not necessarily indicative of cash available
to fund cash needs. A presentation of GAAP based cash flow metrics is as
follows (dollars in thousands) and a discussion of &#147;Liquidity and Capital
Resources&#148; can be found below.


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="56%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>

</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">For the three months ended<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">For the six months ended<HR size="1" noshade></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-04<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-03<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-04<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">6-30-03<HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><U>GAAP
based Cash Flow Metrics</U></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Net cash provided by operating activities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">85,192</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">74,647</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">135,909</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">129,681</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Net cash provided by (used in) investing activities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">(107,417</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">25,289</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">(162,424</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">(19,882</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Net cash provided by (used in) financing activities</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">24,380</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">(126,321</TD>
    <TD nowrap>)</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">21,851</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">$</TD>
    <TD align="right">(101,265</TD>
    <TD nowrap>)</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>



<P align="center" style="font-size: 10pt">33
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt"><U>Liquidity and Capital Resources</U>


<P align="left" style="font-size: 10pt">The primary source of liquidity is our cash flows from operations. Operating
cash flows have historically been determined by: (i)&nbsp;the number of apartment
homes currently owned, (ii)&nbsp;rental rates, (iii)&nbsp;occupancy levels and (iv)
operating expenses with respect to apartment homes. The timing, source and
amount of cash flows provided by financing activities and used in investing
activities are sensitive to the capital markets environment, particularly to
changes in interest rates. Changes in the capital markets environment, such as
changes in interest rates or the availability of cost-effective capital, affect
our plans for development, redevelopment, acquisition and disposition activity.


<P align="left" style="font-size: 10pt">We regularly review our liquidity needs, the adequacy of cash flow from
operations, and other expected liquidity sources to meet these needs. We
believe our principal short-term liquidity needs are to fund:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>normal recurring operating expenses;</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>debt service and maturity payments;</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>preferred stock dividends and DownREIT
partnership unit distributions;</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the minimum dividend payments required to maintain
our REIT qualification under the Internal Revenue Code of
1986;</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>development and redevelopment activity in which we
are currently engaged; and</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>opportunities for the acquisition of improved
property.</TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt">We anticipate that we can fully satisfy these needs from a combination of cash
flows provided by operating activities, proceeds from asset dispositions and
borrowing capacity under our variable rate unsecured credit facility.


<P align="left" style="font-size: 10pt">Cash and cash equivalents totaled $2,501,000 at June&nbsp;30, 2004, a decrease of
$4,664,000 from $7,165,000 on December&nbsp;31, 2003. The following discussion
relates to changes in cash due to operating, investing and financing
activities, which are presented in our Condensed Consolidated Statements of
Cash Flows included elsewhere in this report.


<P align="left" style="font-size: 10pt">Operating Activities &#150; Net cash provided by operating activities increased to
$135,909,000 for the six months ended June&nbsp;30, 2004 from $129,681,000 for the
six months ended June&nbsp;30, 2003, primarily due to additional NOI from recently
acquired and developed communities, partially offset by the loss of NOI from
the thirteen communities sold in 2003 and 2004, as discussed earlier in this
report.


<P align="left" style="font-size: 10pt">Investing Activities &#150; Net cash used in investing activities of $162,424,000 in
the six months ended June&nbsp;30, 2004 related to investments in assets through
development, redevelopment and acquisition of apartment communities. During
the six months ended June&nbsp;30, 2004, we invested $204,476,000 in the purchase
and development of real estate and capital expenditures:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We began the development of five new communities. These
communities, if developed as expected, will contain a total of 1,171
apartment homes, and the total capitalized cost, including land
acquisition costs, is projected to be approximately $216,200,000. We
completed the development of two communities containing a total of 515
apartment homes for a total capitalized cost, including land
acquisition cost, of $96,000,000.</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We completed the redevelopment of one community containing 308
apartment homes for a total capitalized cost of $44,000,000, of which
$35,700,000 was incurred prior to redevelopment.</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We acquired one community containing 105 apartment homes for a
total investment of $24,065,000.</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We had capital expenditures relating to current communities&#146; real
estate assets of $6,127,000 and non-real estate capital expenditures of
$366,000.
</TD>
</TR>
</TABLE>

<P align="center" style="font-size: 10pt">34
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">


</TABLE>

<P align="left" style="font-size: 10pt">Financing Activities &#150; Net cash provided by financing activities totaled
$21,851,000 for the six months ended June&nbsp;30, 2004, primarily due to an
increase in borrowings under our unsecured credit facility, issuance of common
stock for option exercises and issuance of unsecured notes, partially offset by
dividends paid and certain debt repayments. See Note 3, &#147;Notes Payable,
Unsecured Notes and Credit Facility,&#148; of our Condensed Consolidated Financial
Statements, for additional information.


<P align="left" style="font-size: 10pt"><I>Variable Rate Unsecured Credit Facility</I>


<P align="left" style="font-size: 10pt">We have a $500,000,000 revolving variable rate unsecured credit facility with
JPMorgan Chase Bank and Wachovia Bank, N.A. serving as banks and syndication
agents for a syndicate of commercial banks, which we refinanced in May&nbsp;2004,
concurrent with its original maturity date. Under the terms of the new credit
facility, which are substantially consistent with the terms of the old
facility, if we elect to increase the facility by up to an additional
$150,000,000, and one or more banks (from the syndicate or otherwise)
voluntarily agree to provide the additional commitment, then we will be able to
increase the facility up to $650,000,000, and no member of the syndicate of
banks can prohibit such increase; such an increase in the facility will only be
effective to the extent banks (from the syndicate or otherwise) choose to
commit to lend additional funds. We pay participating banks, in the aggregate,
an annual facility fee of approximately $750,000 in quarterly installments.
The unsecured credit facility bears interest at varying levels based on the
London Interbank Offered Rate (&#147;LIBOR&#148;), rating levels achieved on our
unsecured notes and on a maturity schedule selected by us. The current stated
pricing is LIBOR plus 0.55% per annum (2.00% on July&nbsp;30, 2004). The spread
over LIBOR can vary from LIBOR plus 0.50% to LIBOR plus 1.15% based upon the
rating of our long-term unsecured debt. In addition, a competitive bid option
is available for borrowings of up to $250,000,000. This option allows banks
that are part of the lender consortium to bid to provide us loans at a rate
that is lower than the stated pricing provided by the unsecured credit
facility. The competitive bid option may result in lower pricing if market
conditions allow. We had $150,000,000 outstanding under this competitive bid
option at July&nbsp;30, 2004 priced at LIBOR plus 0.29%, or 1.67%. We are subject
to (i)&nbsp;certain customary covenants under the unsecured credit facility,
including, but not limited to, maintaining certain maximum leverage ratios, a
minimum fixed charges coverage ratio and minimum unencumbered assets and equity
levels, and (ii)&nbsp;prohibitions on paying dividends in amounts that exceed 95% of
our FFO, except as may be required to maintain our REIT status. The new
facility matures in May&nbsp;2008, assuming our exercise of a one-year renewal
option. At July&nbsp;30, 2004, $190,400,000 was outstanding, $22,181,000 was used
to provide letters of credit and $287,419,000 was available for borrowing under
the unsecured credit facility.


<P align="left" style="font-size: 10pt"><I>Future Financing and Capital Needs &#150; Debt Maturities</I>


<P align="left" style="font-size: 10pt">One of our principal long-term liquidity needs is the repayment of medium and
long-term debt at the time that such debt matures. For unsecured notes, we
anticipate that no significant portion of the principal of these notes will be
repaid prior to maturity. If we do not have funds on hand sufficient to repay
our indebtedness as it becomes due, it will be necessary for us to refinance
the debt. This refinancing may be accomplished by uncollateralized private or
public debt offerings, additional debt financing that is collateralized by
mortgages on individual communities or groups of communities, draws on our
unsecured credit facility or by additional equity offerings. Although we
believe we will have the capacity to meet our long-term liquidity needs, we
cannot assure you that additional debt financing or debt or equity offerings
will be available or, if available, that they will be on terms we consider
satisfactory.



<P align="center" style="font-size: 10pt">35
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">During 2004, we have had the following debt activity:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We repaid $125,000,000 in previously issued unsecured notes, along
with any unpaid interest, pursuant to their scheduled maturity, and no
prepayment fees were incurred. In addition, we issued $150,000,000 in
unsecured notes under our existing shelf registration statement at an
annual interest rate of 5.375%. Interest on these notes is payable
semi-annually on April&nbsp;15 and October&nbsp;15, and they mature in April
2014.</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We repaid $24,251,000 in fixed rate mortgage debt secured by two
current communities, along with any unpaid interest, repaid $10,400,000
in variable rate, tax-exempt debt related to the sale of a community
and transferred $18,755,000 in variable rate, tax-exempt debt related
to the sale of a community to the purchaser.</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We issued $42,800,000 in variable rate, conventional debt on two
communities, including interest rate protection agreements that serve
to effectively limit the level to which interest rates can rise to a
rate of 10.0%</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We assumed $13,322,000 in fixed rate debt in connection with the
acquisition of two parcels of improved land related to two Development
Rights.</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We replaced the credit enhancements, including interest rate swaps,
on approximately $87,000,000 of our variable rate, tax-exempt debt when
such credit enhancements expired. We put in place interest rate
protection agreements that serve to effectively limit the level to
which interest rates can rise to a range of 6.7% to 9.0%.</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We renegotiated the terms of a fixed rate, tax-exempt bond on one
community in the amount of $9,780,000 to decrease the annual interest
rate from 7.0% to 4.9%.
</TD>
</TR>
</TABLE>

<P align="center" style="font-size: 10pt">36
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

</DIV>

<P align="left" style="font-size: 10pt">The following table details debt maturities for the next five years, excluding
our unsecured credit facility, for debt outstanding at June&nbsp;30, 2004 (dollars
in thousands):

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center">
<TABLE style="font-size: 6.5pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="16%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR style="font-size: 7pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>All-In<br>interest</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Principal<br>maturity</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7"><B>Balance outstanding</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="23"><B>Scheduled maturities</B><HR size="1" noshade></TD>
</TR>
<TR style="font-size: 7pt" valign="bottom">
    <TD nowrap align="center"><B>Community</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>rate (1)</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>date</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>12-31-03</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>6-30-04</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>2004</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>2005</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>2006</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>2007</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>2008</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Thereafter</B><HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><B>Tax-exempt bonds</B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px"><B><I>Fixed
rate</I></B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">

<TD><DIV style="margin-left:40px; text-indent:-10px">CountryBrook</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.30</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Mar-2012</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">17,628</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">17,412</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">312</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">562</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">599</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">638</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">679</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">14,622</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon at Symphony Glen</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.00</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Jul-2024</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9,780</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9,780</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9,780</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon View</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.55</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Aug-2024</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,345</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,140</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">220</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">455</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">485</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">518</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">555</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">14,907</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon at Lexington</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.56</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Feb-2025</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">13,477</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">13,316</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">165</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">347</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">368</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">391</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">415</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11,630</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon at Nob Hill</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">5.80</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Jun-2025</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">19,149</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">19,014</TD>
    <TD nowrap>&nbsp;&nbsp;(2)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">196</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">355</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">380</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">408</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">437</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,238</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon Campbell</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.48</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Jun-2025</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">35,065</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">34,766</TD>
    <TD nowrap>&nbsp;&nbsp;(2)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">434</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">786</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">843</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">904</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">969</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">30,830</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon Pacifica</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.48</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Jun-2025</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">15,906</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">15,770</TD>
    <TD nowrap>&nbsp;&nbsp;(2)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">196</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">356</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">382</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">410</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">440</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">13,986</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon Knoll</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.95</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Jun-2026</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,748</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,628</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">126</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">263</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">282</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">302</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">324</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11,331</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon Landing</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.85</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Jun-2026</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,301</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,240</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">63</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">132</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">142</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">152</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">162</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">5,589</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon Fields</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.55</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">May-2027</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11,106</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11,011</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">98</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">207</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">222</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">239</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">256</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9,989</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon West</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.73</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Dec-2036</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,396</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,362</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">36</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">75</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">80</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">85</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">91</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,995</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon Oaks</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.45</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Jul-2041</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,530</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,479</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">53</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">112</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">120</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">128</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">138</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">16,928</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon Oaks West</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.48</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Apr-2043</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,336</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,288</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">48</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">103</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">110</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">117</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">125</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">16,785</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">201,767</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">200,206</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,947</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">3,753</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,013</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,292</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,591</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">181,610</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:30px; text-indent:-10px"><I><B>Variable rate (4)</B></I></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon at Laguna Niguel (5)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center">Mar-2009</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,400</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">The Promenade</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">2.94</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Oct-2010</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33,185</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">32,929</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">266</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">562</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">605</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">652</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">701</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">30,143</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Waterford</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">1.59</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Jul-2014</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33,100</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">33,100</TD>
    <TD nowrap>&nbsp;&nbsp;(3)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33,100</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon at Mountain View</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">1.59</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Feb-2017</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,300</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">18,300</TD>
    <TD nowrap>&nbsp;&nbsp;(3)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,300</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon at Foxchase I</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">1.59</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Nov-2017</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">16,800</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">16,800</TD>
    <TD nowrap>&nbsp;&nbsp;(3)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">16,800</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon at Foxchase II</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">1.59</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Nov-2017</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9,600</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">9,600</TD>
    <TD nowrap>&nbsp;&nbsp;(3)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9,600</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Fairway Glen</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">1.59</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Nov-2017</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9,580</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">9,580</TD>
    <TD nowrap>&nbsp;&nbsp;(3)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">9,580</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon at Mission Viejo</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">2.36</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Jun-2025</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,039</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6,989</TD>
    <TD nowrap>&nbsp;&nbsp;(6)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">71</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">129</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">139</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">149</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">160</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">6,341</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon Greenbriar (5)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center">May-2026</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,755</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon at Fairway Hills I</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">2.03</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Jun-2026</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11,500</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11,500</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11,500</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">168,259</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">138,798</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">337</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">691</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">744</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">801</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">861</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">135,364</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px"><B>Conventional loans (7)</B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:30px; text-indent:-10px"><B><I>Fixed
rate</I></B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">$125 Million unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.733</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Feb-2004</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">125,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">$100 Million unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.750</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Jan-2005</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">100,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">100,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">100,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">$50 Million unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.500</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Jan-2005</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">50,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">50,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">50,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">$150 Million unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.926</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Jul-2006</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">$150 Million unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">5.178</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Aug-2007</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">$110 Million unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.128</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Dec-2007</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">110,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">110,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">110,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">$50 Million unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.625</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Jan-2008</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">50,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">50,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">50,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">$150 Million unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">8.374</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Jul-2008</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">$150 Million unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.634</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Aug-2009</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">$200 Million unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.665</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Dec-2010</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">200,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">200,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">200,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">$300 Million unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.792</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Sep-2011</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">300,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">300,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">300,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">$50 Million unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.314</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Sep-2011</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">50,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">50,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">50,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">$250 Million unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.261</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Nov-2012</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">250,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">250,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">250,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">$150 Million unsecured notes</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">5.501</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Apr-2014</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,000</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon at Pruneyard</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.250</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">May-2004</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">12,870</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon Walk II</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">8.930</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Aug-2004</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">11,437</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Wheaton Development Right</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">6.990</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Oct-2008</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,693</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">38</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">71</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">77</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">82</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,425</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD nowrap><DIV style="margin-left:40px; text-indent:-10px">Twinbrook Development Right</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.250</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Oct-2011</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">8,624</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">88</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">158</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">171</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">183</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">196</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">7,828</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon Orchards</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">7.650</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Jul-2033</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">20,574</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">20,466</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">114</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">237</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">254</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">272</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">292</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">19,297</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,879,881</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,893,783</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">240</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,466</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">150,502</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">260,537</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">204,913</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,127,125</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">

<TD><DIV style="margin-left:20px; text-indent:-10px"><B><I>Variable
rate (4)</I></B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon on the Sound (8)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">2.69</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">Apr-2005</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">36,526</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">36,311</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">36,311</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon Ledges</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">2.53</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">May-2009</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">19,954</TD>
    <TD nowrap>&nbsp;&nbsp;(6)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">327</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">586</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">619</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">654</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">691</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,077</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:40px; text-indent:-10px">Avalon at Flanders Hill</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">2.53</TD>
    <TD nowrap>%</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" nowrap align="center">May-2009</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">&#151;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right">&nbsp;</TD>
    <TD align="right">22,748</TD>
    <TD nowrap>&nbsp;&nbsp;(6)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">373</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">668</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">706</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">746</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">788</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">19,467</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">36,526</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">79,013</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">700</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">37,565</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,325</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,400</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,479</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">36,544</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD colspan="5"><DIV style="margin-left:10px; text-indent:-10px"><B>Total indebtedness &#151; excluding
unsecured credit facility</B></DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">2,286,433</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">2,311,800</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">3,224</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">192,475</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">156,584</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">267,030</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">211,844</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">1,480,643</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>





<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 7pt">

<TR valign="top">
    <TD width="1%" nowrap align="right">(1)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Includes credit enhancement fees, facility fees, trustees&#146; fees and other
fees.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(2)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Financed by variable rate, tax-exempt debt, but interest rate is
effectively fixed at June&nbsp;30, 2004 at the rate indicated through a swap
agreement.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(3)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Financed by variable rate, tax-exempt debt, that was effectively fixed
through a swap agreement at December&nbsp;31, 2003 and was reported as fixed
rate debt at that time. The debt was restructured in February&nbsp;2004 such
that the interest rate was capped through an interest rate protection
agreement and is currently included as variable rate debt for financial
reporting purposes.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(4)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Variable rates are given as of June&nbsp;30, 2004.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(5)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Included in liabilities related to real estate assets held for sale on
our Condensed Consolidated Balance Sheets as of December&nbsp;31, 2003 included
elsewhere in this report.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(6)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Financed by variable rate debt, but interest rate is capped through an
interest rate protection agreement.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(7)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Balances outstanding do not include $564 of debt discount and $284 of
debt premium as of June&nbsp;30, 2004 and December&nbsp;31, 2003, respectively,
reflected in unsecured notes on our Condensed Consolidated Balance Sheets
included elsewhere in this report.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(8)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Variable rate construction loan was refinanced in March&nbsp;2004, extending
the maturity date to April&nbsp;2005.</TD>
</TR>

</TABLE>


<P align="center" style="font-size: 10pt">37
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt"><I>Future Financing and Capital Needs &#150; Portfolio and Other Activity</I>


<P align="left" style="font-size: 10pt">As of June&nbsp;30, 2004, we had fourteen new communities under construction, for
which a total estimated cost of $232,500,000 remained to be invested. In
addition, we had one community under reconstruction, for which a total
estimated cost of $3,444,000 remained to be invested. Substantially all of the
capital expenditures necessary to complete the communities currently under
construction and reconstruction, as well as development costs related to
pursuing Development Rights, will be funded from:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the remaining capacity under our current $500,000,000 unsecured credit facility;</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the net proceeds from sales of existing communities;</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>retained operating cash;</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the issuance of debt or equity securities; and/or</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>private equity funding.</TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt">Before planned reconstruction activity or the construction of a Development
Right begins, we intend to arrange adequate financing to complete these
undertakings, although we cannot assure you that we will be able to obtain such
financing. In the event that financing cannot be obtained, we may have to
abandon Development Rights, write-off associated pre-development costs that
were capitalized and/or forego reconstruction activity. In such instances, we
will not realize the increased revenues and earnings that we expected from such
Development Rights.


<P align="left" style="font-size: 10pt">We sell assets that do not meet our long-term investment criteria or when
capital and real estate markets allow us to realize a portion of the value
created over the past business cycle and redeploy the proceeds from those sales
to develop and redevelop communities. In response to real estate and capital
markets conditions, including strong institutional demand for product in our
markets, we plan to sell communities during 2004, although at reduced levels as
compared to past disposition activity. However, we cannot assure you that
assets can continue to be sold on terms that we consider satisfactory or that
market conditions will continue to make the sale of assets an appealing
strategy. Because the proceeds from the sale of communities may not be
immediately redeployed into revenue generating assets, the immediate effect of
a sale of a community for a gain is to increase net income, but reduce future
total revenues, total expenses, NOI and FFO. As of July&nbsp;30, 2004, we have one
community classified as held for sale under GAAP. We are actively pursuing the
disposition of this community and expect to close on this disposition in 2004.
However, we cannot assure you that this community will be sold as planned.


<P align="left" style="font-size: 10pt">We are engaging in discussions with a limited number of institutional investors
regarding the possible formation of a discretionary fund that would acquire and
operate apartment communities. This fund would serve, for a period of three
years from the date of its final closing or until a significant portion of its
committed capital is invested, as the exclusive vehicle through which we would
acquire apartment communities, subject to certain exceptions including, among
others, significant individual asset and portfolio acquisitions, properties
acquired in tax-deferred transactions and acquisitions that are inadvisable or
inappropriate for the fund, if any. The fund would not restrict our
development activities, which would not be a part of the fund, and would
terminate after a term of eight years (subject to two one-year extensions). We
may also acquire certain assets and transfer our interests in those assets to
the fund upon its formation. As of July&nbsp;30, 2004, we have acquired two
communities which we intend to transfer to the fund upon its formation. We
intend to actively pursue the formation of the fund, but there can be no
assurance as to when or if such a fund will be formed or, if formed, what its
size, terms or investment performance will be. We have preliminarily targeted
that the fund would have approximately $715,000,000 available for investment
(consisting of approximately $250,000,000 of fund equity, of which we would
commit approximately 20% of the total, and approximately $465,000,000 of debt
financing).


<P align="left" style="font-size: 10pt">We have also recently increased our use of joint ventures, pursuant to which
certain developments will be held upon completion through partnership vehicles.
We generally employ joint ventures primarily to mitigate asset concentration
or market risk and secondarily as a source of liquidity. Each joint venture or
partnership agreement has been and will continue to be individually negotiated,
and our ability to operate and/or dispose of a community in our sole discretion
may be limited to varying degrees depending on the



<P align="center" style="font-size: 10pt">38
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">terms of the joint venture
or partnership agreement. However, we cannot assure you that we will enter
into joint ventures in the future, or that, if we do, we will achieve our
objectives.


<P align="left" style="font-size: 10pt">During 2004, we have engaged in the following joint venture activity:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We entered into a joint venture agreement with an unrelated
third-party for the development of Avalon Chrystie Place I, located
in New York, New York. We hold a 20% equity interest in this joint
venture entity (with a right to 50% of distributions after
achievement of a threshold return), with the remaining 80% equity
interest held by the third-party.</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We entered into an agreement with an unrelated third-party
which provides that, after we complete construction of Avalon Del
Rey, the community will be owned and operated by a joint venture
between us and the third-party. Upon construction completion, the
third-party venture partner will invest $49,000,000 and will be
granted a 70% ownership interest in the venture, while we retain a
30% equity interest.</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>We entered into an agreement to develop Avalon at Juanita
Village through a wholly-owned taxable REIT subsidiary and, upon
construction completion, contribute the community to a joint
venture. Upon contribution of the community to the joint venture,
we expect to be reimbursed for all costs incurred to develop the
community. The third-party joint venture partner will receive a
100% equity interest in the joint venture and will manage the joint
venture. We will receive a residual profits interest and will be
engaged to manage the community for a property management fee.</TD>
</TR>

</TABLE>


<P align="left" style="font-size: 10pt"><U>Off Balance Sheet Arrangements</U>

<P align="left" style="font-size: 10pt">We own interests in unconsolidated real estate entities, with ownership
interests up to 50%. Two of these unconsolidated real estate entities, Avalon
Terrace, LLC and CVP I, LLC, have debt outstanding as of June&nbsp;30, 2004. Avalon
Terrace LLC has $22,500,000 of variable rate debt which matures in 2005 and is
payable by the unconsolidated real estate entity with operating cash flow from
the underlying real estate. CVP I, LLC has a $58,500,000 construction loan
which matures in February&nbsp;2007 and is payable by the unconsolidated real estate
entity. We have not guaranteed the debt on Avalon Terrace LLC, nor do we have
any obligation to fund this debt should the unconsolidated real estate entity
be unable to do so. However, in connection with the general contractor
services that we provide to CVP I, LLC, the entity that owns and is developing
Avalon Chrystie Place I, we have provided a construction completion guarantee
to the lender in order to fulfill their standard financing requirements related
to the construction financing. Our obligations under this guarantee will
terminate following construction completion once all of the lender&#146;s standard
completion requirements have been satisfied. We currently expect this to occur
in the beginning of 2006. There are no lines of credit, side agreements,
financial guarantees or any other derivative financial instruments related to
or between us and our unconsolidated real estate entities. In evaluating our
capital structure and overall leverage, management takes into consideration our
proportionate share of this unconsolidated debt. For more information
regarding the operations of our unconsolidated entities see Note 6,
&#147;Investments in Unconsolidated Real Estate Entities,&#148; of our Condensed
Consolidated Financial Statements.

<P align="center" style="font-size: 10pt">39
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt"><U>Contractual Obligations</U>


<P align="left" style="font-size: 10pt">We currently have contractual obligations consisting primarily of long-term
debt obligations and lease obligations for certain land parcels and office
space. There have not been any material changes outside the ordinary course of
business to our contractual obligations during the six months ended June&nbsp;30,
2004.


<P align="left" style="font-size: 10pt"><U>Development Communities</U>


<P align="left" style="font-size: 10pt">As of July&nbsp;30, 2004, we had fourteen Development Communities under
construction. We expect these Development Communities, when completed, to add
a total of 4,149 apartment homes to our portfolio for a total capitalized cost,
including land acquisition costs, of approximately $790,100,000. Statements
regarding the future development or performance of the Development Communities
are forward-looking statements. We cannot assure you that:


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>we will complete the Development Communities;
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>our budgeted costs or estimates of occupancy rates will be realized;
</TD></TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>our schedule of leasing start dates, construction completion
dates or stabilization dates will be achieved; or</TD>
</TR>

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>future developments will realize returns comparable to our
past developments.</td>
</TR>
</TABLE>

<P align="left" style="font-size: 10pt">You should carefully review the discussion under &#147;Risks of Development and
Redevelopment&#148; included elsewhere in this report.



<P align="center" style="font-size: 10pt">40
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">The following table presents a summary of the Development Communities. We hold
a direct or indirect fee simple ownership interest in these communities except
where noted.


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="28%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">Total</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">Number of</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">capitalized</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">apartment</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">cost (1)</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">Construction</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">Initial</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">Estimated</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">Estimated</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">homes<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">($ millions)<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">start<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">occupancy (2)<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">completion<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">stabilization (3)<HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">1.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Avalon at Grosvenor Station (4)</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><I>North Bethesda, MD</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">497</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">$80.4</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q1 2002</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2003</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q4 2004</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2005</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">2.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Avalon at Glen Cove South</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><I>Glen Cove, NY</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">256</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">65.5</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2002</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q1 2004</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2004</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q1 2005</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">3.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Avalon at Traville (5)</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><I>North Potomac, MD</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">520</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">71.5</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q4 2002</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2003</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q1 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2005</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">4.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Avalon Run East II</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><I>Lawrenceville, NJ</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">312</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">49.3</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2003</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2004</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q1 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2005</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">5.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Avalon at Crane Brook</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><I>Danvers &#038; Peabody, MA</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">387</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">56.2</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2003</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2004</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q4 2005</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">6.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Avalon Milford I</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><I>Milford, CT</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">246</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">32.5</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2003</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2004</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q1 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2005</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">7.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Avalon Chrystie Place I (6)</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><I>New York, NY</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">361</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">149.9</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q4 2003</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q4 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2006</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">8.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Avalon at The Pinehills I</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><I>Plymouth, MA</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">101</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">19.9</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q4 2003</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2004</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q1 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2005</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">9.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Avalon Pines I</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><I>Coram, NY</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">298</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">48.7</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q4 2003</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q1 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q1 2006</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">10.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Avalon Orange</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><I>Orange, CT</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">168</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">22.4</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q1 2004</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q1 2006</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">11.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Avalon Danbury</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><I>Danbury, CT</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">234</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">35.6</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q1 2004</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q4 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2006</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">12.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Avalon Del Rey (7)</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><I>Los Angeles, CA</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">309</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">70.0</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2004</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q4 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2006</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">13.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Avalon at Juanita Village (8)</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><I>Kirkland, WA</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">211</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">45.5</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2004</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q4 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2006</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">14.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Avalon Camarillo</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><I>Camarillo, CA</I></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">249</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">42.7</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2004</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2005</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q1 2006</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q3 2006</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Total</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">4,149</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">$790.1</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>




<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top">
    <TD width="1%" nowrap align="right">(1)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Total capitalized cost includes all capitalized costs projected to be or
actually incurred to develop the respective Development Community,
determined in accordance with GAAP, including land acquisition costs,
construction costs, real estate taxes, capitalized interest and loan fees,
permits, professional fees, allocated development overhead and other
regulatory fees. Total capitalized cost for communities identified as
having joint venture ownership, either during construction or upon
construction completion, represents the total projected joint venture
contribution amount.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(2)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Future initial occupancy dates are estimates.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(3)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Stabilized operations is defined as the earlier of (i)&nbsp;attainment of 95%
or greater physical occupancy or (ii)&nbsp;the one-year anniversary of
completion of development.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(4)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">The community is owned by a DownREIT partnership in which one of our
wholly-owned subsidiaries is the general partner with a majority interest.
This community is consolidated for financial reporting purposes.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(5)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">This is a two-phase community for which construction of the second phase
commenced in the second quarter of 2003.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(6)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">This community is being financed under a joint venture structure with
third-party financing, in which the community is owned by a limited
liability company managed by one of our wholly-owned subsidiaries. The
total capitalized cost for this community includes costs associated with
the construction of 89,000 square feet of retail space and 30,000 square
feet for a community facility. Our portion of the total capitalized cost
of this joint venture is projected to be $30.0&nbsp;million including
community-based tax-exempt debt.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(7)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">The community is currently owned by one of our wholly-owned subsidiaries,
will be financed, in part or in whole, by a construction loan, and is
subject to a joint venture agreement that allows for a joint venture
partner to be admitted upon construction completion.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(8)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">The community is being developed by one of our wholly-owned, taxable REIT
subsidiaries, and is subject to a venture agreement that provides for the
transfer of 100% of the ownership interests to the joint venture upon its
completion.</TD>
</TR>

</TABLE>


<P align="center" style="font-size: 10pt">41
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">




<P align="left" style="font-size: 10pt"><U>Redevelopment Communities</U>


<P align="left" style="font-size: 10pt">As of July&nbsp;30, 2004, we had one community under redevelopment. We expect the
total capitalized cost to complete this community, including the cost of
acquisition, capital expenditures subsequent to acquisition and redevelopment,
to be approximately $160,000,000, of which approximately $26,100,000 is the
additional capital invested or expected to be invested during redevelopment and
$133,900,000 was incurred prior to redevelopment. Statements regarding the
future redevelopment or performance of the Redevelopment Communities are
forward-looking statements. We have found that the cost to redevelop an
existing apartment community is more difficult to budget and estimate than the
cost to develop a new community. Accordingly, we expect that actual costs may
vary from our budget by a wider range than for a new development community. We
cannot assure you that we will meet our schedule for reconstruction completion
or restabilized operations, or that we will meet our budgeted costs, either
individually or in the aggregate. See the discussion under &#147;Risks of
Development and Redevelopment&#148; included elsewhere in this report.

<P align="left" style="font-size: 10pt">The following presents a summary of this Redevelopment Community:


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="95%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">Total cost</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>&nbsp;</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>&nbsp;</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Number of</TD>

    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="7">($ millions)<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">Estimated</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">Estimated</TD>

</TR>


<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">apartment<BR>homes<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Pre-redevelopment<BR>cost<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Total capitalized<BR>cost (1)<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">Reconstruction<BR>start<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">Reconstruction<BR>completion<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">restabilized<BR>operations (2)<HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">1.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Avalon at Prudential Center<BR>
<I>Boston, MA</I>
</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">781</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">133.9</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">$</TD>
    <TD align="right" valign="top">160.0</TD>
    <TD nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q4 2000
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q2 2006
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Q4 2006</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>




<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 7pt">

<TR valign="top">
    <TD width="1%" nowrap align="right">(1)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Total capitalized cost includes all capitalized costs projected to be
incurred to redevelop the respective Redevelopment Community, including
costs to acquire the community, reconstruction costs, real estate taxes,
capitalized interest and loan fees, permits, professional fees, allocated
redevelopment overhead and other regulatory fees determined in accordance
with GAAP.</TD>
</TR>



<TR valign="top">
    <TD width="1%" nowrap align="right">(2)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Restabilized operations is defined as the earlier of (i)&nbsp;attainment of 95%
or greater physical occupancy or (ii)&nbsp;the one-year anniversary of
completion of redevelopment.</TD>
</TR>

</TABLE>


<P align="left" style="font-size: 10pt"><U>Development Rights</U>


<P align="left" style="font-size: 10pt">As of July&nbsp;30, 2004, we are considering the development of 40 new apartment
communities on land that is either owned by us, under contract, subject to a
leasehold interest or for which we hold a purchase option. We generally hold
Development Rights through options to acquire land, although for eleven of the
Development Rights we currently own the land on which a community would be
built if we proceeded with development. The Development Rights range from
those beginning design and architectural planning to those that have completed
site plans and drawings and can begin construction almost immediately. We
estimate that the successful completion of all of these communities would
ultimately add 10,728 apartment homes to our portfolio. Substantially all of
these apartment homes will offer features like those offered by the communities
we currently own. At June&nbsp;30, 2004, there were cumulative capitalized costs
(including legal fees, design fees and related overhead costs, but excluding
land costs) of $33,973,000 relating to Development Rights. In addition, land
costs related to the pursuit of Development Rights (consisting of original land
and additional carrying costs) of $102,418,000 are reflected as land held for
development on the accompanying Condensed Consolidated Balance Sheets as of
June&nbsp;30, 2004.


<P align="left" style="font-size: 10pt">The properties comprising the Development Rights are in different stages of the
due diligence and regulatory approval process. The decisions as to which of
the Development Rights to pursue, if any, or to continue to pursue once an
investment in a Development Right is made, are business judgments that we make
after we perform financial, demographic and other analyses. In the event that
we do not proceed with a Development Right, we generally would not recover
capitalized costs incurred in the pursuit of those communities, unless we were
to recover amounts in connection with the sale of land; however, we cannot
guarantee a recovery. Pre-development costs incurred in the pursuit of
Development Rights for which future development is not yet considered probable
are expensed as incurred. In addition, if the status of a Development Right
changes, deeming future development no longer probable, any capitalized
pre-development costs are written-off with a charge to expense.

<P align="center" style="font-size: 10pt">42
</DIV>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">Although the development of any particular Development Right cannot be assured,
we believe that the Development Rights, in the aggregate, present attractive
potential opportunities for future development and growth of long-term
stockholder value.


<P align="left" style="font-size: 10pt">Statements regarding the future development of the Development Rights are
forward-looking statements. We cannot assure you that:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>we will succeed in obtaining zoning and other necessary
governmental approvals or the financing required to develop these
communities, or that we will decide to develop any particular
community; or</TD>
</TR>


<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>if we undertake construction of any particular community,
that we will complete construction at the total capitalized cost
assumed in the financial projections in the following table.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt">43
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<P><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>

<P align="left" style="font-size: 10pt">The following presents a summary of the 40 Development Rights we are currently
pursuing:


<DIV align="center">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="85%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="31%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Total</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Estimated</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">capitalized</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">number</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">cost</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">Location<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">of homes<HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">($ millions) (1)<HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:20px; text-indent:-10px">1.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Lyndhurst, NJ</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(2)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">347</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">$</TD>
    <TD align="right" valign="top">76</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:20px; text-indent:-10px">2.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Newton, MA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">236</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">60</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:20px; text-indent:-10px">3.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Bedford, MA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(2)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">139</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">21</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:20px; text-indent:-10px">4.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">San Francisco, CA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">313</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">113</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:20px; text-indent:-10px">5.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Los Angeles, CA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(2)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">123</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">36</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:20px; text-indent:-10px">6.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Glen Cove, NY</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(2)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">111</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">31</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:20px; text-indent:-10px">7.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Long Island City, NY Phase II and III</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">613</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">162</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:20px; text-indent:-10px">8.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">New Rochelle, NY Phase II and III</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">588</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">144</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:20px; text-indent:-10px">9.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Hingham, MA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">236</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">44</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">10.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Quincy, MA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(2)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">148</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">24</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">11.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Plymouth, MA Phase II</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">69</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">13</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">12.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Rockville, MD Phase II</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">196</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">28</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">13.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Bellevue, WA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">368</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">71</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">14.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Norwalk, CT</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">312</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">63</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">15.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">New York, NY Phase II and III</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(2)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">308</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">134</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">16.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Shrewsbury, MA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">300</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">44</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">17.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Danvers, MA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">428</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">80</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">18.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Stratford, CT</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">146</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">23</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">19.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Wilton, CT</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">100</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">24</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">20.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Coram, NY Phase II</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(2)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">152</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">26</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">21.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Dublin, CA Phase I</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">304</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">72</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">22.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Encino, CA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">137</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">46</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">23.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Greenburgh, NY Phase II</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">766</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">120</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">24.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Sharon, MA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">190</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">31</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">25.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">West Haven, CT</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">170</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">23</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">26.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Lexington, MA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">387</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">76</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">27.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Andover, MA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">115</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">21</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">28.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Cohasset, MA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">200</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">38</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">29.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Dublin, CA Phase II</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">200</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">47</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">30.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Dublin, CA Phase III</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">205</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">49</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">31.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Yaphank, NY</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">270</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">41</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">32.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Seattle, WA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(2)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">194</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">50</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">33.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Oyster Bay, NY</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">273</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">69</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">34.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">College Park, MD</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">320</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">44</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">35.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Irvine, CA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">290</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">63</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">36.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Camarillo, CA</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">376</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">55</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">37.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Gaithersburg, MD</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">254</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">41</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">38.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Milford, CT</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(2)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">284</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">41</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">39.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Rockville, MD</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(2) (3)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">240</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">46</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="right"><DIV style="margin-left:10px; text-indent:-10px">40.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Wheaton, MD</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(2) (3)</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">320</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">56</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top"><HR size="1" noshade>&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top"><HR size="1" noshade>&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Total</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top">10,728</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">$</TD>
    <TD align="right" valign="top">2,246</TD>
    <TD valign="top">&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top"><HR size="4" noshade>&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top"><HR size="4" noshade>&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>




<P>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 7pt">

<TR valign="top">
    <TD width="1%" nowrap align="right">(1)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Total capitalized cost includes all capitalized costs incurred to date (if
any) and projected to be incurred to develop the respective community,
determined in accordance with GAAP, including land acquisition costs,
construction costs, real estate taxes, capitalized interest and loan fees,
permits, professional fees, allocated development overhead and other regulatory
fees.</TD>
</TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">(2)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">We own the land parcel, but construction has not yet begun.</TD>
</TR>


<TR valign="top">
    <TD width="1%" nowrap align="right">(3)</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="96%">Represents improved land encumbered with debt. The improved land consists
of occupied office buildings. NOI from incidental operations from the current
improvements will be recorded as a reduction in cost basis as described in the
Notes to the Condensed Consolidated Financial Statements included elsewhere in
this report.</TD>
</TR>

</TABLE>


<P align="center" style="font-size: 10pt">44
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">





<P align="left" style="font-size: 10pt"><U>Risks of Development and Redevelopment</U>


<P align="left" style="font-size: 10pt">We intend to continue to pursue the development and redevelopment of apartment
home communities. Our development and redevelopment activities may be exposed
to the following:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>we may abandon opportunities we have already begun to explore
based on further review of, or changes in, financial, demographic,
environmental or other factors;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>we may encounter liquidity constraints, including the
unavailability of financing on favorable terms for the development
or redevelopment of a community;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>we may be unable to obtain, or we may experience delays in
obtaining, all necessary zoning, land-use, building, occupancy, and
other required governmental permits and authorizations;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>we may incur construction or reconstruction costs for a
community that exceed our original estimates due to increased
materials, labor or other expenses, which could make completion of
development or redevelopment of the community uneconomical;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>occupancy rates and rents at a newly completed development or
redevelopment community may fluctuate depending on a number of
factors, including competition and market and general economic
conditions, and may not be sufficient to make the community
profitable; and</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>we may be unable to complete construction and lease-up on
schedule, resulting in increased debt service expense and
construction costs.</TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt">The occurrence of any of the events described above could adversely affect
results of operations and our payment of distributions to our stockholders.


<P align="left" style="font-size: 10pt">Construction costs are projected by us based on market conditions prevailing in
the community&#146;s market at the time our budgets are prepared and reflect changes
to those market conditions that we anticipated at that time. Although we
attempt to anticipate changes in market conditions, we cannot predict those
changes with certainty. Construction costs have been increasing, particularly
for materials, such as steel, concrete and lumber, and, for some of our
Development Communities and Development Rights, the total construction costs
may be higher than the original budget. We do not expect that these price
increases will materially affect our current Development Communities. However,
these increases may materially affect Development Rights where construction has
not yet begun. Total capitalized cost includes all capitalized costs projected
to be incurred to develop the respective Development or Redevelopment
Community, determined in accordance with GAAP, including:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>land and/or property acquisition costs;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>construction or reconstruction costs;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>real estate taxes;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>capitalized interest;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>loan fees;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>permits;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>professional fees;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>allocated development or redevelopment overhead; and</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>other regulatory fees.</TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt">Costs to redevelop communities that have been acquired have, in some cases,
exceeded our original estimates and similar increases in costs may be
experienced in the future. We cannot assure you that market rents in effect at
the time new development communities or redevelopment communities complete
lease-up will be sufficient to fully offset the effects of any increased
construction or reconstruction costs.




<P align="center" style="font-size: 10pt">45
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<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt"><U>Insurance and Risk of Uninsured Losses</U>


<P align="left" style="font-size: 10pt">We carry commercial general liability insurance and property insurance with
respect to all of our communities. These policies, and other insurance
policies we carry, have policy specifications, insured limits and deductibles
that we consider commercially reasonable. There are, however, certain types of
losses (such as losses arising from acts of war) that are not insured, in full
or in part, because they are either uninsurable or the cost of insurance makes
it, in management&#146;s view, economically impractical. If an uninsured property
loss or a property loss in excess of insured limits were to occur, we could
lose our capital invested in a community, as well as the anticipated future
revenues from such community. We would also continue to be obligated to repay
any mortgage indebtedness or other obligations related to the community. If an
uninsured liability to a third-party were to occur, we would incur the cost of
defense and settlement with, or court ordered damages to, that third-party. A
significant uninsured property or liability loss could materially and adversely
affect our financial condition and results of operations.


<P align="left" style="font-size: 10pt">Many of our West Coast communities are located in the general vicinity of
active earthquake faults. A large concentration of our communities lie near,
and thus are susceptible to, the major fault lines in the San Francisco Bay
Area, including the San Andreas fault and the Hayward fault. We cannot assure
you that an earthquake would not cause damage or losses greater than insured
levels. In June&nbsp;2003, we renewed our earthquake insurance. We have in place
with respect to communities located in California, for any single occurrence
and in the aggregate, $75,000,000 of coverage with a deductible per building
equal to five percent of the insured value of that building. The five percent
deductible is subject to a minimum of $100,000 per occurrence. Earthquake
coverage outside of California is subject to a $75,000,000 limit, except with
respect to the state of Washington, for which the limit is $65,000,000. Our
earthquake insurance outside of California provides for a $100,000 deductible
per occurrence. In addition, up to an annual policy aggregate of $3,000,000,
the next $400,000 of loss per occurrence outside California will be treated as
an additional deductible.


<P align="left" style="font-size: 10pt">Our annual general liability policy and workman&#146;s compensation coverage was
renewed on August&nbsp;1, 2004 and the insurance coverage provided for in these
renewal policies did not materially change from the preceding year. Including
the costs we estimate that we may incur as a result of deductibles, we expect
the cost related to these insurance categories for the policy period from
August&nbsp;1, 2004 to July&nbsp;31, 2005 to remain flat as compared to the prior period.


<P align="left" style="font-size: 10pt">Our property insurance policy was scheduled to renew on February&nbsp;1, 2005;
however, in an effort to capitalize on declining insurance rates we elected to
cancel the prior policy and rewrite the policy effective June&nbsp;1, 2004 with a
new expiration date of December&nbsp;1, 2005. Based on this renewal, we have seen a
decline in insurance premiums for property coverage, which combined with the
cost we may incur as a result of deductibles, will result in declining overall
insurance costs as compared to prior periods.


<P align="left" style="font-size: 10pt">Just as with office buildings, transportation systems and government buildings,
there have been reports that apartment communities could become targets of
terrorism. In November&nbsp;2002, Congress passed the Terrorism Risk Insurance Act
(&#147;TRIA&#148;) which is designed to make terrorism insurance available. In
connection with this legislation, we have purchased insurance for property
damage due to terrorism up to $200,000,000. Additionally, we have purchased
insurance for certain terrorist acts, not covered under TRIA, such as
domestic-based terrorism. This insurance, often referred to as &#147;non-certified&#148;
terrorism insurance, is subject to deductibles, limits and exclusions. Our
general liability policy provides TRIA coverage (subject to deductibles and
insured limits) for liability to third parties that result from terrorist acts
at our communities.


<P align="left" style="font-size: 10pt">Mold growth may occur when excessive moisture accumulates in buildings or on
building materials, particularly if the moisture problem remains undiscovered
or is not addressed over a period of time. Although the occurrence of mold at
multifamily and other structures, and the need to remediate such mold, is not a
new phenomenon, there has been increased awareness in recent years that certain
molds may in some instances lead to adverse health effects, including allergic
or other reactions. To help limit mold growth, we educate residents about the
importance of adequate ventilation and request or require that they notify us
when they see mold or excessive moisture. We have established procedures for
promptly addressing and remediating mold or excessive moisture from apartment
homes when we become aware of its presence regardless of whether we or the
resident believe a health risk is present. However, we cannot



<P align="center" style="font-size: 10pt">46
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<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">assure that mold
or excessive moisture will be detected and remediated in a timely manner. If a
significant mold problem arises at one of our communities, we could be required
to undertake a costly remediation program to contain or remove the mold from
the affected community and could be exposed to other liabilities. We cannot
assure that we will have coverage under our existing policies for property
damage or liability to third parties arising as a result of exposure to mold or
a claim of exposure to mold at one of our communities.


<P align="left" style="font-size: 10pt">In March&nbsp;2004, we renewed our D&#038;O insurance. In the past year, we have noted
an increase in competition from new carriers entering the market and expanded
capital capacity of existing carriers, resulting in a partial reversal of the
significant premium increases experienced in recent years. Our premium for
this insurance decreased as compared to the prior coverage period at renewal.


<P align="left" style="font-size: 10pt"><U>Inflation and Deflation</U>


<P align="left" style="font-size: 10pt">Substantially all of our apartment leases are for a term of one year or less.
In an inflationary environment, this may allow us to realize increased rents
upon renewal of existing leases or the beginning of new leases. Short-term
leases generally minimize our risk from the adverse effects of inflation,
although these leases generally permit residents to leave at the end of the
lease term and therefore expose us to the effect of a decline in market rents.
In a deflationary rent environment, we may be exposed to declining rents more
quickly under these shorter-term leases.


<P align="left" style="font-size: 10pt"><U>Forward-Looking Statements</U>


<P align="left" style="font-size: 10pt">This Form 10-Q contains &#147;forward-looking statements&#148; as that term is defined
under the Private Securities Litigation Reform Act of 1995. You can identify
forward-looking statements by our use of the words &#147;believe,&#148; &#147;expect,&#148;
&#147;anticipate,&#148; &#147;intend,&#148; &#147;estimate,&#148; &#147;assume,&#148; &#147;project,&#148; &#147;plan,&#148; &#147;may,&#148;
&#147;shall,&#148; &#147;will&#148; and other similar expressions in this Form 10-Q, that predict
or indicate future events and trends or that do not report historical matters.
These statements include, among other things, statements regarding our intent,
belief or expectations with respect to:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>our potential development, redevelopment, acquisition or
disposition of communities;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the timing and cost of completion of apartment
communities under construction, reconstruction, development
or redevelopment;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the timing of lease-up, occupancy and stabilization of apartment communities;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the pursuit of land on which we are considering future development;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the anticipated operating performance of our communities;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>cost, yield and earnings estimates;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>our declaration or payment of distributions;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>our policies regarding investments, indebtedness,
acquisitions, dispositions, financings and other matters;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>our qualification as a REIT under the Internal Revenue
Code;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the real estate markets in Northern and Southern
California and markets in selected states in the
Mid-Atlantic, Northeast, Midwest and Pacific Northwest
regions of the United States and in general;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>the availability of debt and equity financing;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>interest rates;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>general economic conditions; and</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>trends affecting our financial condition or results of operations.</TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt">We cannot assure the future results or outcome of the matters described in
these statements; rather, these statements merely reflect our current
expectations of the approximate outcomes of the matters discussed. You should
not rely on forward-looking statements because they involve known and unknown
risks, uncertainties and other factors, some of which are beyond our control.
These risks, uncertainties and other factors may cause our actual results,
performance or achievements to differ materially from the anticipated future
results, performance or achievements expressed or implied by these
forward-looking statements. Some of the factors that could cause our actual
results, performance or achievements to differ materially




<P align="center" style="font-size: 10pt">47
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<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">from those expressed
or implied by these forward-looking statements include, but are not limited to,
the following:



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>we may fail to secure development opportunities due to
an inability to reach agreements with third parties or to
obtain desired zoning and other local approvals;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>we may abandon or defer development opportunities for
a number of reasons, including changes in local market
conditions which make development less desirable, increases
in costs of development and increases in the cost of capital;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>construction costs of a community may exceed our
original estimates;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>we may not complete construction and lease-up of
communities under development or redevelopment on schedule,
resulting in increased interest expense and construction
costs and a decrease in our expected rental revenues;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>occupancy rates and market rents may be adversely
affected by competition and local economic and market
conditions which are beyond our control;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>financing may not be available on favorable terms or
at all, and our cash flow from operations and access to cost
effective capital may be insufficient for the development of
our pipeline which could limit our pursuit of opportunities;</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>our cash flow may be insufficient to meet required
payments of principal and interest, and we may be unable to
refinance existing indebtedness or the terms of such
refinancing may not be as favorable as the terms of existing
indebtedness; and</TD>
</TR>



<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">&#149;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>we may be unsuccessful in managing changes in our
portfolio composition.</TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt">These forward-looking statements represent our estimates and assumptions only
as of the date of this report. We do not undertake to update these
forward-looking statements, and you should not rely upon them after the date of
this report.




<P align="center" style="font-size: 10pt">48
</DIV>


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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt"><B>Part&nbsp;I. &nbsp; FINANCIAL INFORMATION (continued)</B>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="9%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="85%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top">Item&nbsp;3.</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Quantitative and Qualitative Disclosures About Market Risk<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">There have been no material changes to our exposures to market
risk since December&nbsp;31, 2003.<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">Item&nbsp;4.</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Controls and Procedures<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">(a)
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Evaluation of disclosure controls and procedures.</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">The Company carried out an evaluation under the
supervision and with the participation of the Company&#146;s
management, including the Company&#146;s Chief Executive
Officer and Chief Financial Officer, of the
effectiveness of the design and operation of the
Company&#146;s disclosure controls and procedures as of June
30, 2004. Based upon that evaluation, the Chief
Executive Officer and Chief Financial Officer concluded
that the Company&#146;s disclosure controls and procedures
are effective to ensure that information required to be
disclosed by the Company in the reports it files or
submits under the Exchange Act is recorded, processed,
summarized and reported, within the time periods
specified in the Securities and Exchange Commission&#146;s
rules and forms. We continue to review and document our
disclosure controls and procedures, including our
internal controls and procedures for financial
reporting, and may from time to time make changes aimed
at enhancing their effectiveness and to ensure that our
systems evolve with our business.</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">(b)
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Changes in internal controls over financial reporting.</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">None.</TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>



<P align="left" style="font-size: 10pt"><B>Part II. &nbsp; OTHER INFORMATION</B>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="9%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="85%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top">Item&nbsp;1.</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Legal Proceedings<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">As reported most recently in our Form&nbsp;10-Q for the quarter ended
March&nbsp;31, 2004, we are currently involved in litigation with York
Hunter Construction, Inc. and National Union Fire Insurance
Company. A non-jury trial ended in April&nbsp;2004 and on May&nbsp;20,
2004, the court issued a ruling, finding that (i)&nbsp;York Hunter
breached the Construction Management Agreement between it and the
Company in failing to complete the project and abandoning the
construction site and is therefore liable to the Company for
consequential damages, and (ii)&nbsp;National Union, having failed to
exercise its various rights to perform and complete, is liable to
the Company for consequential damages. The court requested that
each party prepare proposed findings of fact and conclusions of
law regarding damages. Such pleading was filed on behalf of the
Company on July&nbsp;16, 2004. There can be no assurance as to whether
the court&#146;s ruling will be appealed by York Hunter or National
Union, and the Company at this time can give no assurances as to
the amount of damages it may be awarded by the court.<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Also as reported in our Form&nbsp;10-Q for the quarter ended March&nbsp;31,
2004, on June&nbsp;6, 2003, a purported California class action
lawsuit, <i>Julie E. Ko v. AvalonBay Communities, Inc. and Does 1
through 100</I>, was filed against the Company in California&#146;s Los
Angeles County Superior Court. The suit purports to be brought on
behalf of all of the Company&#146;s former California residents who,
during the four-year period prior to the filing of the suit, paid
a security deposit to the Company for the rental of residential
property in California and had a portion of the deposit withheld
by the Company in excess of the damages actually sustained by the
Company. The plaintiff seeks compensatory and statutory damages
in unspecified amounts as well as injunctive relief, restitution,
and an award of attorneys&#146; fees, expenses and costs of suit. The
complaint seeking class certification was<BR></TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>



<P align="center" style="font-size: 10pt">49
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="9%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="85%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">amended in March&nbsp;2004 and the Company responded to the amended
complaint on May&nbsp;3, 2004. Due to the uncertainty of many critical
factual and legal issues, including the viability of the case as
a class action, it is not possible to determine or predict the
outcome.<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">We are involved in various other claims and/or administrative
proceedings that arise in the ordinary course of our business.
While no assurances can be given, the Company does not believe
that any of these outstanding litigation matters, individually or
in the aggregate, including the matters described immediately
above, will have a material adverse effect on the Company.<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">Item&nbsp;2.</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Changes in Securities, Use of Proceeds and Issuer Purchases of
Equity Securities<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">During the three months ended June&nbsp;30, 2004, AvalonBay issued 762
shares of common stock in exchange for 762 units of limited
partnership held by certain limited partners of Bay Countrybrook,
L.P. The shares were issued in reliance on an exemption from
registration under Section&nbsp;4(2) of the Securities Act of 1933.
AvalonBay is relying on the exemption based on factual
representations received from the limited partners who received
these shares.<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">Item&nbsp;3.</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Defaults Upon Senior Securities<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">None.<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">Item&nbsp;4.</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Submission of Matters to a Vote of Security Holders<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">The Company held its 2004 Annual Meeting of Stockholders on May
5, 2004. Stockholders were asked to vote on the re-election of
the following persons as directors of the Company: Bryce Blair,
Bruce A. Choate, John J. Healy, Jr., Gilbert M. Meyer, Charles D.
Peebler, Jr., Lance R. Primis, Allan D. Schuster and Amy P.
Williams. Each individual standing for election as a director of
the Company had been elected in 2003 to serve until the 2004
Annual Meeting of Stockholders and until their respective
successors were duly elected and qualified. The results of the
voting were as follows:<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">61,308,626 votes were cast for and 746,796 votes were
withheld from the election of Mr.&nbsp;Blair.</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">60,032,861 votes were cast for and 2,022,561 votes were
withheld from the election of Mr.&nbsp;Choate.</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">61,759,821 votes were cast for and 295,601 votes were
withheld from the election of Mr.&nbsp;Healy.</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">61,743,543 votes were cast for and 311,879 votes were
withheld from the election of Mr.&nbsp;Meyer.</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">25,422,314 votes were cast for and 36,633,108 votes
were withheld from the election of Mr.&nbsp;Peebler.</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">61,590,261 votes were cast for and 465,161 votes were
withheld from the election of Mr.&nbsp;Primis.</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">60,857,941 votes were cast for and 1,197,481 votes were
withheld from the election of Mr.&nbsp;Schuster.</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">60,854,216 votes were cast for and 1,201,206 votes were
withheld from the election of Ms.&nbsp;Williams.</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Election as a director requires the affirmative vote of a
majority of outstanding shares as of the close of business on the
record date established for the Annual Meeting. In the case of
the 2004 Annual Meeting of Stockholders, a majority of
outstanding shares as of the close of business on the record date
was 35,670,385. Accordingly, the following individuals were
re-elected to serve as directors of the Company until the 2005
Annual<BR></TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>



<P align="center" style="font-size: 10pt">50
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="9%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="85%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Meeting of Stockholders and until their respective successors are
duly elected and qualify: Bryce Blair, Bruce A. Choate, John J.
Healy, Jr., Gilbert M. Meyer, Lance R. Primis, Allan D. Schuster
and Amy P. Williams. In addition, because there were only eight
nominees for eight board positions, Mr.&nbsp;Peebler ran unopposed and
he continues to serve as a director.<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Stockholders were also asked to vote on a stockholder proposal
relating to shareholder rights plans. The following stockholder
proposal was proposed and defeated at the meeting:<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&#147;RESOLVED: Shareholders request that our Directors
increase shareholder voting rights and submit the
adoption, maintenance or extension of any poison pill
to a shareholder vote as a separate ballot item as soon
as may be practical. Also once this proposal is
adopted, any dilution or removal of this proposal is
requested to be submitted to a shareholder vote at the
earliest possible shareholder election. Directors have
the flexibility of discretion accordingly in scheduling
the earliest shareholder vote and in responding to
shareholder votes.&#148;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Approval of the stockholder proposal required the affirmative
vote of a majority of the votes cast on the proposal. Of the
votes cast on this proposal, 46,118,234 were cast against,
10,844,855 were cast for, and 113,960 abstained. Accordingly, the
stockholder proposal failed.<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">Item&nbsp;5.</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Other Information<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">None.<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">Item&nbsp;6.</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left">Exhibits and Reports on Form&nbsp;8-K<BR></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top" align="left"><B>(a)&nbsp;Exhibits</B><BR></TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="90%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD nowrap valign="top"><DIV style="margin-left:0px; text-indent:-0px"><U>Exhibit No.</U>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><U>Description</u></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">3(i).1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Articles of Amendment and Restatement of Articles of Incorporation of AvalonBay Communities (the
&#147;Company&#148;), dated as of June&nbsp;4, 1998. (Incorporated by reference to Exhibit&nbsp;3(i).1 to Form&nbsp;10-Q of the
Company filed August&nbsp;14, 1998.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">3(i).2
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Articles of Amendment, dated as of October&nbsp;2, 1998. (Incorporated by reference to Exhibit&nbsp;3.1(ii) to Form
8-K of the Company filed on October&nbsp;6, 1998.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">3(i).3
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Articles Supplementary, dated as of October&nbsp;13, 1998, relating to the 8.70% Series&nbsp;H Cumulative Redeemable
Preferred Stock. (Incorporated by reference to Exhibit&nbsp;1 to Form&nbsp;8-A of the Company filed October&nbsp;14,
1998.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">3(ii).1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Amended and Restated Bylaws of the Company, as adopted by the Board of Directors on February&nbsp;13, 2003.
(Incorporated by reference to Exhibit&nbsp;3(ii) to Form&nbsp;10-K of the Company filed March&nbsp;11, 2003.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Indenture of Avalon Properties, Inc. (hereinafter referred to as &#147;Avalon Properties&#148;) dated as of
September&nbsp;18, 1995. (Incorporated by reference to Form&nbsp;8-K of Avalon Properties dated September&nbsp;18,
1995.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.2
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">First Supplemental Indenture of Avalon Properties dated as of September&nbsp;18, 1995. (Incorporated by
reference to Exhibit&nbsp;4.2 to Form&nbsp;10-K of the Company filed March&nbsp;26, 2002.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.3
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Second Supplemental Indenture of Avalon Properties dated as of December&nbsp;16, 1997. (Incorporated by
reference to Exhibit&nbsp;4.3 to Form&nbsp;10-K of the Company filed March&nbsp;11, 2003.)</TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>



<P align="center" style="font-size: 10pt">51
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="90%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.4
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Third Supplemental Indenture of Avalon Properties dated as of January&nbsp;22, 1998. (Incorporated by
reference to Exhibit&nbsp;4.4 to Form&nbsp;10-K of the Company filed March&nbsp;11, 2003.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.5
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Indenture, dated as of January&nbsp;16, 1998, between the Company and State Street Bank and Trust Company, as
Trustee. (Incorporated by reference to Exhibit&nbsp;4.5 to Form&nbsp;10-K of the Company filed on March&nbsp;11, 2003.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.6
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">First Supplemental Indenture, dated as of January&nbsp;20, 1998, between the Company and the Trustee.
(Incorporated by reference to Exhibit&nbsp;4.6 to Form&nbsp;10-K of the Company filed on March&nbsp;11, 2003.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.7
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Second Supplemental Indenture, dated as of July&nbsp;7, 1998, between the Company and the Trustee.
(Incorporated by reference to Exhibit&nbsp;4.2 to Form&nbsp;8-K of the Company filed on July&nbsp;9, 1998.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.8
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Amended and Restated Third Supplemental Indenture, dated as of July&nbsp;10, 2000 between the Company and the
Trustee, including forms of Floating Rate Note and Fixed Rate Note. (Incorporated by reference to Exhibit
4.4 to the Company&#146;s Current Report on Form&nbsp;8-K filed on July&nbsp;11, 2000.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.9
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Dividend Reinvestment and Stock Purchase Plan of the Company filed on September&nbsp;14, 1999. (Incorporated
by reference to Form&nbsp;S-3 of the Company, File No.&nbsp;333-87063.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.10
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Amendment to the Company&#146;s Dividend Reinvestment and Stock Purchase Plan filed on December&nbsp;17, 1999.
(Incorporated by reference to the Prospectus Supplement filed pursuant to Rule&nbsp;424(b)(2) of the Securities
Act of 1933 on December&nbsp;17, 1999.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.11
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Amendment to the Company&#146;s Dividend Reinvestment and Stock Purchase Plan filed on March&nbsp;26, 2004.
(Incorporated by reference to the Prospectus Supplement filed pursuant to Rule&nbsp;424(b)(3) of the Securities
Act of 1933 on March&nbsp;26, 2004).</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">10.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Amended and Restated Revolving Loan Agreement, dated as of May&nbsp;24, 2004, among AvalonBay Communities,
Inc., as Borrower, JPMorgan Chase Bank and Wachovia Bank, N.A., each as a Bank and Syndication Agent,
Fleet National Bank, as a Bank, Swing Lender and Issuing Bank, Morgan Stanley Bank, Wells Fargo Bank,
N.A., and Deutsche Bank Trust Company Americas, each as a Bank and Documentation Agent, the other banks
signatory thereto, each as a Bank, J.P. Morgan Securities, Inc., as Sole Bookrunner and Lead Arranger, and
Fleet National Bank, as Administrative Agent. (Filed herewith.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">12.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Statements re: Computation of Ratios. (Filed herewith.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">31.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Certification pursuant to Section&nbsp;302 of the Sarbanes-Oxley Act of 2002 (Chief Executive Officer.) (Filed
herewith.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">31.2
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Certification pursuant to Section&nbsp;302 of the Sarbanes-Oxley Act of 2002 (Chief Financial Officer.) (Filed
herewith.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">32
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&#151;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Certification pursuant to Section&nbsp;906 of the Sarbanes-Oxley Act of 2002 (Chief Executive Officer and Chief
Financial Officer). (Furnished herewith.)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>(b)&nbsp;Reports on Form&nbsp;8-K</B></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">On April&nbsp;21, 2004, the Company filed a Report on Form&nbsp;8-K to
report, under Item&nbsp;5 of such form, the commencement and pricing of
a public offering of an aggregate of $150,000,000 principal amount
of its 5.375% Medium Term Notes Due 2014.</TD>
</TR>

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</DIV>



<P align="center" style="font-size: 10pt">52
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="center" style="font-size: 10pt"><B>SIGNATURES</B>

<P align="left" style="font-size: 10pt">Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


<P align="center" style="font-size: 10pt"><B>AVALONBAY COMMUNITIES, INC.</B>


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>Date: August 6, 2004&nbsp;</TD>
    <TD valign="top">&nbsp;&nbsp;</TD>
        <TD colspan="2" style="border-bottom: 1px solid #000000">
/s/ Bryce Blair</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2">Bryce Blair&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2">Chief Executive Officer and President&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>Date: August 6, 2004&nbsp;</TD>
    <TD valign="top">&nbsp;&nbsp;</TD>
        <TD colspan="2" style="border-bottom: 1px solid #000000">
/s/ Thomas J. Sargeant&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2">Thomas J. Sargeant&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2">Chief Financial Officer&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt">53
</DIV>

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</HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>2
<FILENAME>w99702exv10w1.htm
<DESCRIPTION>EXHIBIT 10.1
<TEXT>
<HTML>
<HEAD>
<TITLE>exv10w1</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<P align="right" style="font-size: 10pt">Exhibit 10.1

<P>

<HR size="4" noshade color="#000000" style="margin-top: -5px">
<HR size="1" noshade color="#000000" style="margin-top: -10px">



<P align="center" style="font-size: 10pt"><B>AMENDED AND RESTATED<BR>
REVOLVING LOAN AGREEMENT</B>


<P align="center" style="font-size: 10pt">dated as of May&nbsp;24, 2004


<P align="center" style="font-size: 10pt">among


<P align="center" style="font-size: 10pt">AVALONBAY COMMUNITIES, INC.,<BR>
as Borrower,


<P align="center" style="font-size: 10pt">JPMORGAN CHASE BANK and<BR>
WACHOVIA BANK, NATIONAL ASSOCIATION,<BR>
as a Bank and Syndication Agent,


<P align="center" style="font-size: 10pt">FLEET NATIONAL BANK,<BR>
as a Bank, Swing Lender and Issuing Bank


<P align="center" style="font-size: 10pt">MORGAN STANLEY BANK,<BR>
WELLS FARGO BANK, NATIONAL ASSOCIATION<BR>
and DEUTSCHE BANK TRUST COMPANY AMERICAS,<BR>
as a Bank and Documentation Agent,


<P align="center" style="font-size: 10pt">THE OTHER BANKS SIGNATORY HERETO,<BR>
each as a Bank,


<P align="center" style="font-size: 10pt">J.P. MORGAN SECURITIES INC.,<BR>
as Sole Bookrunner and Lead Arranger,


<P align="center" style="font-size: 10pt">and


<P align="center" style="font-size: 10pt">FLEET NATIONAL BANK,<BR>
as Administrative Agent


<P>
<HR size="1" noshade color="#000000" style="margin-top: -2px">
<HR size="4" noshade color="#000000" style="margin-top: -10px">








<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">








<P align="center" style="font-size: 10pt"><u>TABLE OF CONTENTS</u>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="90%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="11%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="73%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD colspan="5" align="left">ARTICLE I&nbsp;&nbsp; DEFINITIONS; ETC</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 1.01</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Definitions</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 1.02</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Accounting Terms</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 1.03</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Computation of Time Periods</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 1.04</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Rules of Construction</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD colspan="5" align="left">ARTICLE II&nbsp;&nbsp; THE LOANS</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.01</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Ratable Loans; Bid Rate Loans; Purpose</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.02</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Bid Rate Loans</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.03</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Advances, Generally</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">22</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.04</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Procedures for Advances</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">22</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.05</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Interest Periods; Renewals</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">23</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.06</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Interest</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">23</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.07</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Fees</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">23</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.08</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Notes</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">24</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.09</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Prepayments</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">25</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.10</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Cancellation of Commitments</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">25</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.11</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Method of Payment</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">25</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.12</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Elections, Conversions or Continuation of Loans</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">26</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.13</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Minimum Amounts</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">26</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.14</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Certain Notices Regarding Elections, Conversions and Continuations of Loans</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">26</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.15</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Late Payment Premium</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">27</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.16</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Letters of Credit</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">27</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.17</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Swing Loans</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">28</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.18</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Extension Of Maturity</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">30</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 2.19</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Additional Loan Commitments</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">30</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD colspan="5" align="left">ARTICLE III&nbsp;&nbsp; YIELD PROTECTION; ILLEGALITY, ETC</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">32</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 3.01</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Additional Costs</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">32</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 3.02</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Limitation on Types of Loans</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">33</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 3.03</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Illegality</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">34</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>



<P align="center" style="font-size: 10pt">-i-
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="90%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="11%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="73%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 3.04</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Treatment of Affected Loans</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">34</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 3.05</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Certain Compensation</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">34</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 3.06</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Capital Adequacy</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">35</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 3.07</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Substitution of Banks</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">35</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 3.08</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Applicability</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">37</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD colspan="5" align="left">ARTICLE IV&nbsp;&nbsp; CONDITIONS PRECEDENT</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">37</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 4.01</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Conditions Precedent to the Initial Advance</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">37</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 4.02</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Conditions Precedent to Each Advance</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">38</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 4.03</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Deemed Representations</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD colspan="5" align="left">ARTICLE V&nbsp;&nbsp; REPRESENTATIONS AND WARRANTIES</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 5.01</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Due Organization</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 5.02</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Power and Authority; No Conflicts; Compliance With Laws</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 5.03</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Legally Enforceable Agreements</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 5.04</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Litigation</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 5.05</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Good Title to Properties</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">40</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 5.06</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Taxes</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">40</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 5.07</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">ERISA</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">40</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 5.08</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">No Default on Outstanding Judgments or Orders, Etc.</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">40</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 5.09</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">No Defaults on Other Agreements</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">41</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 5.10</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Government Regulation</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">41</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 5.11</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Environmental Protection</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">41</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 5.12</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Solvency</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">41</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 5.13</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Financial Statements</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">41</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 5.14</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Valid Existence of Affiliates</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">41</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 5.15</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Insurance</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">42</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 5.16</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Accuracy of Information; Full Disclosure</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">42</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD colspan="5" align="left">ARTICLE VI&nbsp;&nbsp; AFFIRMATIVE COVENANTS</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">42</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 6.01</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Maintenance of Existence</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">42</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 6.02</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Maintenance of Records</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">42</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 6.03</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Maintenance of Insurance</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">42</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 6.04</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Compliance with Laws; Payment of Taxes</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">42</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 6.05</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Right of Inspection</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">43</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 6.06</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Compliance With Environmental Laws</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">43</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>



<P align="center" style="font-size: 10pt">-ii-
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="90%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="11%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="73%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 6.07</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Maintenance of Properties</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">43</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 6.08</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Payment of Costs</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">43</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 6.09</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Reporting and Miscellaneous Document Requirements</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">43</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 6.10</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Principal Prepayments as a Result of Reduction in Total Loan Commitment</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">45</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD colspan="5" align="left">ARTICLE VII&nbsp;&nbsp; NEGATIVE COVENANTS</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">45</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 7.01</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Mergers Etc.</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">45</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 7.02</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Investments</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">45</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 7.03</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Sale of Assets</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">46</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 7.04</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Distributions</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">46</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD colspan="5" align="left">ARTICLE VIII&nbsp;&nbsp; FINANCIAL COVENANTS</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">46</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 8.01</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Consolidated Tangible Net Worth</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">46</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 8.02</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Relationship of Total Outstanding Indebtedness to Capitalization Value</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">46</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 8.03</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Relationship of Combined EBITDA to Interest Expense</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">46</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 8.04</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Relationship of Combined EBITDA to Combined Debt Service</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">46</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 8.05</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Ratio of Unsecured Indebtedness to Unencumbered Asset Value</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">47</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 8.06</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Relationship of Unencumbered Combined EBITDA to Unsecured Interest Expense</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">47</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 8.07</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Relationship of Dividends to Funds From Operations</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">47</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 8.08</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Relationship of Secured Indebtedness to Capitalization Value</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">47</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD colspan="5" align="left">ARTICLE IX&nbsp;&nbsp; EVENTS OF DEFAULT</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">47</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 9.01</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Events of Default</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">47</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 9.02</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Remedies</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">49</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD colspan="5" align="left">ARTICLE X&nbsp;&nbsp; ADMINISTRATIVE AGENT; RELATIONS AMONG BANKS</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">50</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.01</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Appointment, Powers and Immunities of Administrative Agent</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">50</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.02</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Reliance by Administrative Agent</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">50</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.03</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Defaults</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">51</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.04</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Rights of Administrative Agent as a Bank</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">51</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.05</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Indemnification of Administrative Agent</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">51</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.06</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Non-Reliance on Administrative Agent and Other Banks</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">52</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.07</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Failure of Administrative Agent to Act</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">52</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.08</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Resignation or Removal of Administrative Agent</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">52</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>



<P align="center" style="font-size: 10pt">-iii-
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="90%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="4%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="11%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="73%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.09</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Amendments Concerning Agency Function</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">53</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.10</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Liability of Administrative Agent</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">53</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.11</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Transfer of Agency Function</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">53</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.12</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Non-Receipt of Funds by Administrative Agent</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">53</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.13</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Withholding Taxes</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">54</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.14</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Minimum Commitment by Agents</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">54</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.15</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Pro Rata Treatment</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">54</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.16</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Sharing of Payments Among Banks</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">55</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 10.17</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Possession of Documents</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">55</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD colspan="5" align="left">ARTICLE XI&nbsp;&nbsp; NATURE OF OBLIGATIONS</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">55</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 11.01</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Absolute and Unconditional Obligations</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">55</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 11.02</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Non-Recourse to Borrower's Principals</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">56</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD colspan="5" align="left">ARTICLE XII&nbsp;&nbsp; MISCELLANEOUS</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">56</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.01</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Binding Effect of Request for Advance</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">56</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.02</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Amendments and Waivers</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">56</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.03</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Usury</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">57</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.04</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Expenses; Indemnification</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">57</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.05</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Assignment; Participation</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">58</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.06</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Documentation Satisfactory</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">59</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.07</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Notices</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">60</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.08</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Setoff</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">60</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.09</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Table of Contents; Headings</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">60</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.10</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Severability</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">60</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.11</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Counterparts</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">60</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.12</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Integration</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">60</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.13</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Governing Law</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">60</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.14</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Waivers</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">60</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.15</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Jurisdiction; Immunities</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">61</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.16</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Designated Lender</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">61</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.17</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">No Bankruptcy Proceedings</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">62</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.18</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">USA Patriot Act</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">62</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Section 12.19</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Transitional Arrangements</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">62</TD>
    <TD>&nbsp;</TD>
</TR>

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</TABLE>
</DIV>



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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt">AMENDED AND RESTATED REVOLVING LOAN AGREEMENT dated as of May&nbsp;24, 2004 (this
&#147;<B><I>Agreement</I></B>&#148;) among AVALONBAY COMMUNITIES, INC., a corporation organized and
existing under the laws of the State of Maryland (&#147;<B><I>Borrower</I></B>&#148;); JPMORGAN CHASE
BANK (&#147;<B><I>JPMC</I></B>&#148;), FLEET NATIONAL BANK or any successor thereto (in its individual
capacity and not as Administrative Agent, &#147;<B><I>Fleet</I></B>&#148;) and the other lenders
signatory hereto, as Banks; MORGAN STANLEY BANK, WELLS FARGO BANK, NATIONAL
ASSOCIATION and DEUTSCHE BANK TRUST COMPANY AMERICAS, as Documentation Agent;
and FLEET NATIONAL BANK, as administrative agent for the Banks (in such
capacity, together with its successors in such capacity, &#147;<B><I>Administrative
Agent</I></B>&#148;; JPMC, Fleet, the other lenders signatory hereto, such other lenders who
from time to time become Banks pursuant to Section&nbsp;2.19, 3.07 or 12.05 and, if
applicable, any of the foregoing lenders&#146; Designated Lender, each a &#147;<B><I>Bank</I></B>&#148; and
collectively, the &#147;<B><I>Banks</I></B>&#148;).



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Borrower, JPMC, Fleet, certain of the Banks and the Administrative Agent
entered into that certain Revolving Loan Agreement, dated as of May&nbsp;24, 2001
(the &#147;<B><I>2001 Credit Agreement</I></B>&#148;) and now desire to amend and restate the 2001
Credit Agreement in its entirety in accordance with the terms and provisions
contained herein. Accordingly, in consideration of the premises and the mutual
agreements, covenants and conditions hereinafter set forth, Borrower,
Administrative Agent and each of the Banks agree as follows:


<P align="center" style="font-size: 10pt"><B>ARTICLE I</B>


<P align="center" style="font-size: 10pt"><B>DEFINITIONS; ETC.</B>


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;1.01 </B><u><B>Definitions</B></u>. As used in this Agreement the following
terms have the following meanings:

<P align="left" style="font-size: 10pt">&#147;<B><I>Absolute Bid Rate</I></B>&#148; has the meaning specified in Section&nbsp;2.02(c)(2).


<P align="left" style="font-size: 10pt">&#147;<B><I>Absolute Bid Rate Loan</I></B>&#148; means a Bid Rate Loan bearing interest at the Absolute
Bid Rate.


<P align="left" style="font-size: 10pt">&#147;<b><I>Absolute Rate Auction</I></B>&#148; means a solicitation of Bid Rate Quotes setting forth
Absolute Bid Rates pursuant to Section&nbsp;2.02.


<P align="left" style="font-size: 10pt">&#147;<B><I>Acceptance Letter</I></B>&#148; has the meaning specified in Section&nbsp;2.19.


<P align="left" style="font-size: 10pt">&#147;<B><I>Accordion Amount</I></B>&#148; means, at any time, $150,000,000.


<P align="left" style="font-size: 10pt">&#147;<B><I>Acquisition</I></B>&#148; means the acquisition by Borrower, directly or indirectly, of an
interest in multi-family real estate.


<P align="left" style="font-size: 10pt">&#147;<B><I>Additional Costs</I></B>&#148; has the meaning specified in Section&nbsp;3.01.


<P align="left" style="font-size: 10pt">&#147;<b><I>Administrative Agent</I></B>&#148; has the meaning specified in the preamble.


<P align="left" style="font-size: 10pt">&#147;<B><I>Administrative Agent&#146;s Office</I></B>&#148; means Administrative Agent&#146;s address located at
777 Main Street, Hartford, Connecticut 06115, or such other address in the
United States as Administrative Agent may designate by written notice to
Borrower and the Banks.



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<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">&#147;<B><I>Affiliate</I></B>&#148; means, with respect to any Person (the &#147;first Person&#148;), any other
Person (1)&nbsp;which directly or indirectly controls, or is controlled by, or is
under common control with the first Person; or (2)&nbsp;10% or more of the
beneficial interest in which is directly or indirectly owned or held by the
first Person. The term &#147;control&#148; means the possession, directly or indirectly,
of the power, alone, to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities, by
contract, or otherwise.


<P align="left" style="font-size: 10pt">&#147;<B><I>Agreement</I></B>&#148; has the meaning specified in the preamble.


<P align="left" style="font-size: 10pt">&#147;<B><I>Applicable Lending Office</I></B>&#148; means, for each Bank and for its LIBOR Loan, Bid
Rate Loan(s) or Base Rate Loan, as applicable, the lending office of such Bank
(or of an Affiliate of such Bank) designated as such on its signature page
hereof or in the applicable Assignment and Acceptance, or such other office of
such Bank (or of an Affiliate of such Bank) as such Bank may from time to time
specify to Administrative Agent and Borrower as the office by which its LIBOR
Loan, Bid Rate Loan(s) or Base Rate Loan (and, in the case of the Swing Lender,
its Swing Loan), as applicable, is to be made and maintained.


<P align="left" style="font-size: 10pt">&#147;<B><I>Applicable Margin</I></B>&#148; means, with respect to Base Rate Loans and LIBOR Loans (and
for purposes of determining the Banks&#146; L/C Fee Rate under Section&nbsp;2.16(f)), the
respective rates per annum determined at any time, based on the range into
which Borrower&#146;s Credit Rating then falls, in accordance with the following
table (any change in Borrower&#146;s Credit Rating causing it to move to a different
range on the table shall effect an immediate change in the Applicable Margin):


<DIV align="center">
    <TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="65%">
      <!-- Begin Table Head -->
      <TR valign="bottom">
        <TD width="67%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="9%">&nbsp;</TD>
        <TD width="10%">&nbsp;</TD>
        <TD width="9%">&nbsp;</TD>
      </TR>

      <TR style="font-size: 1px">
        <TD colspan="5" align="left"><HR size="1" noshade> &nbsp;</TD>
      </TR>

      <TR style="font-size: 8pt" valign="bottom">
        <TD nowrap align="left"><div align="center">Range of Borrower's</div></TD>
        <TD>&nbsp;</TD>
        <TD nowrap align="center"><B>&nbsp;</B></TD>
        <TD>&nbsp;</TD>
        <TD nowrap align="center"><B>&nbsp;</B></TD>
      </TR>
      <TR style="font-size: 8pt" valign="bottom">
        <TD nowrap align="left"><div align="center">Credit Rating</div></TD>
        <TD>&nbsp;</TD>
        <TD nowrap align="center">Applicable Margin</TD>
        <TD>&nbsp;</TD>
        <TD nowrap align="center">Applicable Margin</TD>
      </TR>
      <TR style="font-size: 8pt" valign="bottom">
        <TD nowrap align="left"><div align="center">(S&#038;P/Moody's or other</div></TD>
        <TD>&nbsp;</TD>
        <TD nowrap align="center">for Base Rate Loans</TD>
        <TD>&nbsp;</TD>
        <TD nowrap align="center">for LIBOR Loans</TD>
      </TR>
      <TR style="font-size: 8pt" valign="bottom">
        <TD nowrap align="left"><div align="center">agency equivalent)</div></TD>
        <TD>&nbsp;</TD>
        <TD nowrap align="center">(% per annum)</TD>
        <TD>&nbsp;</TD>
        <TD nowrap align="center">(% per annum)</TD>
      </TR>
      <!-- End Table Head -->
      <!-- Begin Table Body -->

      <TR style="font-size: 1px">
        <TD colspan="5" align="left"><HR size="1" noshade> &nbsp;</TD>
      </TR>
      <TR valign="bottom" style="background: #eeeeee">
        <TD><DIV style="margin-left:10px; text-indent:-10px">Below BBB- or unrated/<br>
            Below Baa3 or unrated</DIV></TD>
        <TD>&nbsp;</TD>
        <TD align="left" valign="top">0.25</TD>
        <TD>&nbsp;</TD>
        <TD align="left" valign="top">1.15</TD>
      </TR>
      <TR style="font-size: 1px">
        <TD colspan="5" align="left"><HR size="1" noshade> &nbsp;</TD>
      </TR>
      <TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px">BBB-/Baa3</DIV></TD>
        <TD>&nbsp;</TD>
        <TD align="left" valign="top">0.00</TD>
        <TD>&nbsp;</TD>
        <TD align="left" valign="top">0.95</TD>
      </TR>
      <TR style="font-size: 1px">
        <TD colspan="5" align="left"><HR size="1" noshade> &nbsp;</TD>
      </TR>
      <TR valign="bottom" style="background: #eeeeee">
        <TD><DIV style="margin-left:10px; text-indent:-10px">BBB/Baa2</DIV></TD>
        <TD>&nbsp;</TD>
        <TD align="left" valign="top">0.00</TD>
        <TD>&nbsp;</TD>
        <TD align="left" valign="top">0.75</TD>
      </TR>
      <TR style="font-size: 1px">
        <TD colspan="5" align="left"><HR size="1" noshade> &nbsp;</TD>
      </TR>
      <TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px">BBB&#043;/Baa1</DIV></TD>
        <TD>&nbsp;</TD>
        <TD align="left" valign="top">0.00</TD>
        <TD>&nbsp;</TD>
        <TD align="left" valign="top">0.55</TD>
      </TR>
      <TR style="font-size: 1px">
        <TD colspan="5" align="left"><HR size="1" noshade> &nbsp;</TD>
      </TR>
      <TR valign="bottom" style="background: #eeeeee">
        <TD><DIV style="margin-left:10px; text-indent:-10px">A- or higher/A3 or
            higher</DIV></TD>
        <TD>&nbsp;</TD>
        <TD align="left" valign="top">0.00</TD>
        <TD>&nbsp;</TD>
        <TD align="left" valign="top">0.50</TD>
      </TR>
      <TR style="font-size: 1px">
        <TD colspan="5" align="left"><HR size="1" noshade> &nbsp;</TD>
      </TR>
      <!-- End Table Body -->
    </TABLE>
</DIV>


<P align="left" style="font-size: 10pt">&#147;<B><I>Assignee</I></B>&#148; has the meaning specified in Section&nbsp;12.05.


<P align="left" style="font-size: 10pt">&#147;<B><I>Assignment and Acceptance</I></B>&#148; means an Assignment and Acceptance, substantially
in the form of <B>EXHIBIT E</B>, pursuant to which a Bank assigns and an Assignee
assumes rights and obligations in accordance with Section&nbsp;12.05.


<P align="left" style="font-size: 10pt">&#147;<B><I>Authorization Letter</I></B>&#148; means a letter agreement executed by Borrower in the
form of <B>EXHIBIT A</B>.


<P align="left" style="font-size: 10pt">&#147;<B><I>Available Total Loan Commitment</I></B>&#148; has the meaning specified in Section&nbsp;2.01(b).



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<P align="left" style="font-size: 10pt">&#147;<B><I>Bank</I></B>&#148; and &#147;<B><I>Banks</I></B>&#148; have the respective meanings specified in the preamble;
provided, however, that the term &#147;Bank&#148; shall exclude each Designated Lender
when used in reference to a Ratable Loan, the Loan Commitments or terms
relating to the Ratable Loans and the Loan Commitments.


<P align="left" style="font-size: 10pt">&#147;<B><I>Bank Parties</I></B>&#148; means Administrative Agent, Issuing Bank, Swing Lender and the
Banks.


<P align="left" style="font-size: 10pt">&#147;<B><I>Banking Day</I></B>&#148; means (1)&nbsp;any day on which commercial banks are not authorized or
required to close in New York City and (2)&nbsp;whenever such day relates to a LIBOR
Loan, a LIBOR Bid Rate Loan, an Interest Period with respect to a LIBOR Loan or
a LIBOR Bid Rate Loan, or notice with respect to a LIBOR Loan or a LIBOR Bid
Rate Loan or a LIBOR Auction, a day on which dealings in Dollar deposits are
also carried out in the London interbank market and banks are open for business
in London.


<P align="left" style="font-size: 10pt">&#147;<B><I>Base Rate</I></B>&#148; means, for any day, the higher of (1)&nbsp;the Federal Funds Rate for
such day plus .50%, or (2)&nbsp;the Prime Rate for such day.


<P align="left" style="font-size: 10pt">&#147;<B><I>Base Rate Loan</I></B>&#148; means all or any portion (as the context requires) of a Bank&#146;s
Ratable Loan which shall accrue interest at a rate determined in relation to
the Base Rate.


<P align="left" style="font-size: 10pt">&#147;<B><I>Bid Borrowing Limit</I></B>&#148; means the lesser of $250,000,000 or fifty percent (50%)
of the Total Loan Commitment.


<P align="left" style="font-size: 10pt">&#147;<B><I>Bid Rate Loan</I></B>&#148; has the meaning specified in Section&nbsp;2.01(c).


<P align="left" style="font-size: 10pt">&#147;<B><I>Bid Rate Loan Note</I></B>&#148; has the meaning specified in Section&nbsp;2.08.


<P align="left" style="font-size: 10pt">&#147;<B><I>Bid Rate Quote</I></B>&#148; means an offer by a Bank to make a Bid Rate Loan in accordance
with Section&nbsp;2.02.


<P align="left" style="font-size: 10pt">&#147;<B><I>Bid Rate Quote Request</I></B>&#148; has the meaning specified in Section&nbsp;2.02(a).


<P align="left" style="font-size: 10pt">&#147;<B><I>Borrower</I></B>&#148; has the meaning specified in the preamble.


<P align="left" style="font-size: 10pt">&#147;<B><I>Borrower&#146;s Accountants</I></B>&#148; means Ernst &#038; Young, or such other accounting firm(s)
selected by Borrower and reasonably acceptable to the Super-Majority Banks.


<P align="left" style="font-size: 10pt">&#147;<B><I>Borrower&#146;s Credit Rating</I></B>&#148; means the rating assigned from time to time to
Borrower&#146;s unsecured and unsubordinated long-term indebtedness by,
respectively, S&#038;P, Moody&#146;s and/or one or more other nationally-recognized
rating agencies reasonably approved by Administrative Agent. If such a rating
is assigned by only one (1)&nbsp;such rating agency, it must be either S&#038;P or
Moody&#146;s. If such a rating is assigned by two (2)&nbsp;such rating agencies, at
least one (1)&nbsp;must be S&#038;P or Moody&#146;s, and &#147;Borrower&#146;s Credit Rating&#148; shall be
the lower of said ratings, except if the aforesaid ratings are greater than one
(1)&nbsp;rating level apart, in which case &#147;Borrower&#146;s Credit Rating&#148; shall be the
average of said ratings. If such a rating is obtained from more than two (2)
such rating agencies, &#147;Borrower&#146;s Credit Rating&#148; shall be the higher of the
lowest two (2)&nbsp;ratings, if at least one (1)&nbsp;of such two (2)&nbsp;is either S&#038;P or
Moody&#146;s; if neither of the two (2)&nbsp;lowest ratings is from S&#038;P or Moody&#146;s, then
&#147;Borrower&#146;s Credit Rating&#148; shall be the lower of the ratings from S&#038;P and



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<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="left" style="font-size: 10pt">Moody&#146;s. Unless such indebtedness of Borrower is rated by either S&#038;P or
Moody&#146;s, &#147;Borrower&#146;s Credit Rating&#148; shall be considered unrated for purposes of
this Agreement.


<P align="left" style="font-size: 10pt">&#147;<B><I>Borrower&#146;s Principals</I></B>&#148; means the officers and directors of Borrower at any
applicable time.


<P align="left" style="font-size: 10pt">&#147;<B><I>Borrower&#146;s Share of UJV Combined Outstanding Indebtedness</I></B>&#148; means the sum of
the indebtedness of each of the UJVs contributing to UJV Combined Outstanding
Indebtedness multiplied by Borrower&#146;s respective beneficial fractional
interests in each such UJV.


<P align="left" style="font-size: 10pt">&#147;<B><I>Capitalization Value</I></B>&#148; means, as of the end of any calendar quarter, the sum of
(1)&nbsp;Combined EBITDA (less all leasing commissions and management and
development fees, net of any expenses applicable thereto, contributing to
Combined EBITDA) for such quarter annualized (i.e., multiplied by four (4)),
capitalized at a rate of 8.0% per annum (i.e., divided by 8.0%), (2)&nbsp;such
leasing commissions and management and development fees for such quarter,
annualized, (i.e., multiplied by four (4)), capitalized at a rate of 25% per
annum (i.e., divided by 25%), (3)&nbsp;Cash and Cash Equivalents of Borrower and its
Consolidated Businesses, as of the end of such quarter, as reflected in
Borrower&#146;s Consolidated Financial Statements and (4)&nbsp;the lesser of (a)&nbsp;the
aggregate book value (on a cost basis) of the properties of Borrower and its
Consolidated Businesses under development plus Borrower&#146;s beneficial interest
in the book value (on a cost basis) of the properties of the UJVs under
development or (b)&nbsp;20% of the sum of the amounts determined pursuant to clauses
(1), (2)&nbsp;and (3)&nbsp;of this definition.


<P align="left" style="font-size: 10pt">&#147;<B><I>Capital Lease</I></B>&#148; means any lease which has been or should be capitalized on the
books of the lessee in accordance with GAAP.


<P align="left" style="font-size: 10pt">&#147;<B><I>Cash and Cash Equivalents</I></B>&#148; means (1)&nbsp;cash, (2)&nbsp;direct obligations of the
United States Government, including, without limitation, treasury bills, notes
and bonds, (3)&nbsp;interest-bearing or discounted obligations of federal agencies
and government-sponsored entities or pools of such instruments offered by
Approved Banks and dealers, including, without limitation, Federal Home Loan
Mortgage Corporation participation sale certificates, Government National
Mortgage Association modified pass through certificates, Federal National
Mortgage Association bonds and notes, and Federal Farm Credit System
securities, (4)&nbsp;time deposits, domestic and eurodollar certificates of deposit,
bankers&#146; acceptances, commercial paper rated at least A-1 by S&#038;P and P-1 by
Moody&#146;s and/or guaranteed by an Aa rating by Moody&#146;s, an AA rating by S&#038;P or
better rated credit, floating rate notes, other money market instruments and
letters of credit each issued by Approved Banks, (5)&nbsp;obligations of domestic
corporations, including, without limitation, commercial paper, bonds,
debentures and loan participations, each of which is rated at least AA by S&#038;P
and/or Aa2 by Moody&#146;s and/or guaranteed by an Aa rating by Moody&#146;s, an AA
rating by S&#038;P or better rated credit, (6)&nbsp;obligations issued by states and
local governments or their agencies, rated at least MIG-1 by Moody&#146;s and /or
SP-1 by S&#038;P and /or guaranteed by an irrevocable letter of credit of an
Approved Bank, (7)&nbsp;repurchase agreements with major banks and primary
government security dealers fully secured by the United States Government or
agency collateral equal to or exceeding the principal amount on a daily basis
and held in safekeeping and (8)&nbsp;real estate loan pool participations,
guaranteed by an AA rating given by S&#038;P or an Aa2 rating given by Moody&#146;s or
better rated credit. For purposes of this definition, &#147;Approved Bank&#148; means a
financial institution which has (x) (A)&nbsp;a minimum net worth of $500,000,000
and/or (B)&nbsp;total assets of at least $10,000,000,000 and (y)&nbsp;a minimum long-term
debt rating of A&#043; by S&#038;P or A1 by Moody&#146;s.



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<P align="left" style="font-size: 10pt">&#147;<B><I>Closing Date</I></B>&#148; means the date this Agreement has been executed by all parties.


<P align="left" style="font-size: 10pt">&#147;<B><I>Code</I></B>&#148; means the Internal Revenue Code of 1986, including the rules and
regulations promulgated thereunder.


<P align="left" style="font-size: 10pt">&#147;<B><I>Combined Debt Service</I></B>&#148; means, for any period of time, (1)&nbsp;Borrower&#146;s share of
total debt service (including principal) paid or payable by Borrower and its
Consolidated Businesses during such period (other than debt service on
construction loans until completion of the relevant construction and other
capitalized interest) plus a deemed annual capital expense charge of $150 per
apartment unit owned by Borrower or its Consolidated Businesses plus (2)
Borrower&#146;s beneficial interest in (a)&nbsp;total debt service (including principal)
paid or payable by the UJVs during such period (other than debt service on
construction loans until completion of the relevant construction and other
capitalized interest) plus (b)&nbsp;a deemed annual capital expense charge of $150
per apartment unit owned by the UJVs plus (3)&nbsp;preferred dividends and
distributions paid or payable by Borrower and its Consolidated Businesses
during such period.


<P align="left" style="font-size: 10pt">&#147;<B><I>Combined EBITDA</I></B>&#148; means, for any period of time, the sum, without duplication,
of (1)&nbsp;Borrower&#146;s share of revenues less operating expenses, general and
administrative expenses and property taxes before Interest Expense, income
taxes, gains or losses on the sale of real estate and/or marketable securities,
depreciation and amortization and extraordinary items for Borrower and its
Consolidated Businesses, and adjusted, if material, for non-cash revenue
attributable to straight lining of rents and (2)&nbsp;Borrower&#146;s beneficial interest
in revenues less operating expenses, general and administrative expenses and
property taxes before Interest Expense, income taxes, gains or losses on the
sale of real estate and/or marketable securities, depreciation and amortization
and extraordinary items (after eliminating appropriate intercompany amounts)
applicable to each of the UJVs, and adjusted, if material, for non-cash revenue
attributable to straight lining of rents, in all cases as reflected in
Borrower&#146;s Consolidated Financial Statements.


<P align="left" style="font-size: 10pt">&#147;<B><I>Consolidated Business</I></B>&#148; means, individually, each Affiliate of Borrower who is
or should be included in Borrower&#146;s Consolidated Financial Statements in
accordance with GAAP.


<P align="left" style="font-size: 10pt">&#147;<B><I>Consolidated Financial Statements</I></B>&#148; means, with respect to any Person, the
consolidated balance sheet and related consolidated statement of operations,
accumulated deficiency in assets and cash flows, and footnotes thereto, of such
Person, prepared in accordance with GAAP.


<P align="left" style="font-size: 10pt">&#147;<B><I>Consolidated Outstanding Indebtedness</I></B>&#148; means, as of any time, Borrower&#146;s share
of all indebtedness and liability for borrowed money, secured or unsecured, of
Borrower and its Consolidated Businesses, including mortgage and other notes
payable but excluding any indebtedness which is margin indebtedness on cash and
cash equivalent securities, all as reflected in Borrower&#146;s Consolidated
Financial Statements.


<P align="left" style="font-size: 10pt">&#147;<B><I>Consolidated Tangible Net Worth</I></B>&#148; means, at any date, Borrower&#146;s share of the
consolidated stockholders&#146; equity of Borrower and its Consolidated Businesses
less their consolidated Intangible Assets, all determined as of such date. For
purposes of this definition, &#147;<B><I>Intangible Assets</I></B>&#148; means with respect to any such
intangible assets, the amount (to the extent reflected in determining such
consolidated stockholders&#146; equity) of (1)&nbsp;all write-ups (other than write-ups
resulting from foreign currency translations and write-ups of assets of a going
concern business made within twelve (12)



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<P align="left" style="font-size: 10pt">months after the acquisition of such business) subsequent to September&nbsp;30, 1994
in the book value of any asset (other than real property assets) owned by
Borrower or a Consolidated Business and (2)&nbsp;all debt discount and expense,
deferred charges, goodwill, patents, trademarks, service marks, trade names,
anticipated future benefit of tax loss carry-forwards, copyrights, organization
or developmental expenses and other intangible assets (in each case, not
adjusted for depreciation).


<P align="left" style="font-size: 10pt">&#147;<B><I>Construction-in-Process</I></B>&#148; means a property on which construction of
improvements (excluding non-revenue generating capital expenditures and
excluding costs incurred prior to construction, all as set forth in related
quarterly financial statements or supplemental financial information attached
thereto) has commenced and is proceeding to completion in the ordinary course
but has not yet been completed (as such completion shall be evidenced by a
temporary or permanent certificate of occupancy permitting use of such property
by the general public). Any such property shall be treated as
Construction-in-Process until the earlier of (i)&nbsp;12&nbsp;months from the date of
completion (as evidenced by a certificate of occupancy permitting use of such
property by the general public) or (ii)&nbsp;such property achieves the occupancy
requirements set forth in clause (2)&nbsp;of the definition of Unencumbered
Wholly-Owned Assets.


<P align="left" style="font-size: 10pt">&#147;<B><I>Contingent Obligations</I></B>&#148; means, without duplication, Borrower&#146;s share of (1)
any contingent obligations of Borrower or its Consolidated Businesses required
to be shown on the balance sheet of Borrower and its Consolidated Businesses in
accordance with GAAP and (2)&nbsp;any obligation required to be disclosed in the
footnotes to Borrower&#146;s Consolidated Financial Statements, guaranteeing
partially or in whole any non-Recourse Debt, lease, dividend or other
obligation, exclusive of contractual indemnities (including, without
limitation, any indemnity or price-adjustment provision relating to the
purchase or sale of securities or other assets) and guarantees of non-monetary
obligations (other than guarantees of completion) which have not yet been
called on or quantified, of Borrower or any of its Consolidated Businesses or
of any other Person. The amount of any Contingent Obligation described in
clause (2)&nbsp;shall be deemed to be (a)&nbsp;with respect to a guaranty of interest or
interest and principal, or operating income guaranty, the net present value
(using the Base Rate as a discount rate) of the sum of all payments required to
be made thereunder (which in the case of an operating income guaranty shall be
deemed to be equal to the debt service for the note secured thereby), through
(i)&nbsp;in the case of an interest or interest and principal guaranty, the stated
date of maturity of the obligation (and commencing on the date interest could
first be payable thereunder) or (ii)&nbsp;in the case of an operating income
guaranty, the date through which such guaranty will remain in effect and (b)
with respect to all guarantees not covered by the preceding clause (a), an
amount equal to the stated or determinable amount of the primary obligation in
respect of which such guaranty is made or, if not stated or determinable, the
maximum reasonably anticipated liability in respect thereof (assuming Borrower
and/or one or more of its Consolidated Businesses is required to perform
thereunder) as recorded on the balance sheet and on the footnotes to the most
recent Borrower&#146;s Consolidated Financial Statements required to be delivered
pursuant to this Agreement. Notwithstanding anything contained herein to the
contrary, guarantees of completion shall not be deemed to be Contingent
Obligations unless and until a claim for payment or performance has been made
thereunder, at which time any such guaranty of completion shall be deemed to be
a Contingent Obligation in an amount equal to any such claim. Subject to the
preceding sentence, (1)&nbsp;in the case of a joint and several guaranty given by
Borrower or one of its Consolidated Businesses and another Person (but only to
the extent such guaranty is recourse, directly or indirectly to Borrower), the
amount of the guaranty shall be deemed to be 100% thereof unless and only to
the extent that such other Person has delivered Cash



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<P align="left" style="font-size: 10pt">and Cash Equivalents to secure all or any part of such Person&#146;s guaranteed
obligations and (2)&nbsp;in the case of joint and several guarantees given by a
Person in which Borrower owns an interest (which guarantees are non-recourse to
Borrower), to the extent the guarantees, in the aggregate, exceed 10% of
Capitalization Value, the amount in excess of 10% shall be deemed to be a
Contingent Obligation of Borrower. Notwithstanding anything contained herein
to the contrary, &#147;<B><I>Contingent Obligations</I></B>&#148; shall be deemed not to include
guarantees of unadvanced funds under any indebtedness of Borrower or its
Consolidated Businesses or of construction loans to the extent the same have
not been drawn. All matters constituting &#147;Contingent Obligations&#148; shall be
calculated without duplication.


<P align="left" style="font-size: 10pt">&#147;<B><I>Continue</I></B>&#148;, &#147;<B><I>Continuation</I></B>&#148; and &#147;<B><I>Continued</I></B>&#148; refer to the continuation pursuant
to Section&nbsp;2.12 of a LIBOR Loan as a LIBOR Loan from one Interest Period to the
next Interest Period.


<P align="left" style="font-size: 10pt">&#147;<B><I>Convert</I></B>&#148;, &#147;<B><I>Conversion</I></B>&#148; and &#147;<B><I>Converted</I></B>&#148; refer to a conversion pursuant to
Section&nbsp;2.12 of a Base Rate Loan into a LIBOR Loan or a LIBOR Loan into a Base
Rate Loan, each of which may be accompanied by the transfer by a Bank (at its
sole discretion) of all or a portion of its Ratable Loan from one Applicable
Lending Office to another.


<P align="left" style="font-size: 10pt">&#147;<B><I>Debt</I></B>&#148; means (1)&nbsp;indebtedness or liability for borrowed money, or for the
deferred purchase price of property or services (including trade obligations);
(2)&nbsp;obligations as lessee under Capital Leases; (3)&nbsp;current liabilities in
respect of unfunded vested benefits under any Plan; (4)&nbsp;obligations under
letters of credit issued for the account of any Person; (5)&nbsp;all obligations
arising under bankers&#146; or trade acceptance facilities; (6)&nbsp;all guarantees,
endorsements (other than for collection or deposit in the ordinary course of
business), and other contingent obligations to purchase any of the items
included in this definition, to provide funds for payment, to supply funds to
invest in any Person, or otherwise to assure a creditor against loss; (7)&nbsp;all
obligations secured by any Lien on property owned by the Person whose Debt is
being measured, whether or not the obligations have been assumed; and (8)&nbsp;all
obligations under any agreement providing for contingent participation or other
hedging mechanisms with respect to interest payable on any of the items
described above in this definition..


<P align="left" style="font-size: 10pt">&#147;<B><I>Declining Bank</I></B>&#148; has the meaning specified in Section&nbsp;2.19.


<P align="left" style="font-size: 10pt">&#147;<B><I>Default</I></B>&#148; means any event which with the giving of notice or lapse of time, or
both, would become an Event of Default.


<P align="left" style="font-size: 10pt">&#147;<B><I>Default Rate</I></B>&#148; means a rate per annum equal to: (1)&nbsp;with respect to Base Rate
Loans and Swing Loans, a variable rate 3% above the rate of interest then in
effect thereon; and (2)&nbsp;with respect to LIBOR Loans and Bid Rate Loans, a fixed
rate 3% above the rate(s) of interest in effect thereon (including the
Applicable Margin or the LIBOR Bid Margin, as the case may be) at the time of
Default until the end of the then current Interest Period therefor and,
thereafter, a variable rate 3% above the rate of interest for a Base Rate Loan.


<P align="left" style="font-size: 10pt">&#147;<B><I>Designated Lender</I></B>&#148; means a special purpose corporation that (i)&nbsp;shall have
become a party to this Agreement pursuant to Section&nbsp;12.16 and (ii)&nbsp;is not
otherwise a Bank.


<P align="left" style="font-size: 10pt">&#147;<B><I>Designating Lender</I></B>&#148; has the meaning specified in Section&nbsp;12.16.



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<P align="left" style="font-size: 10pt">&#147;<B><I>Designation Agreement</I></B>&#148; means an agreement in substantially the form of <B>EXHIBIT
F</B>, entered into by a Bank and a Designated Lender and accepted by
Administrative Agent.


<P align="left" style="font-size: 10pt">&#147;<B><I>Disposition</I></B>&#148; means a sale (whether by assignment, transfer or Capital Lease)
of an asset.


<P align="left" style="font-size: 10pt">&#147;<B><I>Documentation Agent</I></B>&#148; means, individually and collectively, Morgan Stanley
Bank, Wells Fargo Bank, National Association and Deutsche Bank Trust Company
Americas<B>.</B>


<P align="left" style="font-size: 10pt">&#147;<B><I>Dollars</I></B>&#148; and the sign &#147;$&#148; mean lawful money of the United States of America.


<P align="left" style="font-size: 10pt">&#147;<B><I>Elect</I></B>&#148; and &#147;<B><I>Election</I></B>&#148; refer to election, if any, by Borrower pursuant to
Section&nbsp;2.12 to have all or a portion of an advance of the Ratable Loans be
outstanding as LIBOR Loans.


<P align="left" style="font-size: 10pt">&#147;<B><I>Environmental Discharge</I></B>&#148; means any discharge or release of any Hazardous
Materials in violation of any applicable Environmental Law.


<P align="left" style="font-size: 10pt">&#147;<B><I>Environmental Law</I></B>&#148; means any applicable Law relating to pollution or the
environment, including Laws relating to noise or to emissions, discharges,
releases or threatened releases of Hazardous Materials into the work place, the
community or the environment, or otherwise relating to the generation,
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials.


<P align="left" style="font-size: 10pt">&#147;<B><I>Environmental Notice</I></B>&#148; means any written complaint, order, citation or notice
from any Person (1)&nbsp;affecting or relating to Borrower&#146;s compliance with any
Environmental Law in connection with any activity or operations at any time
conducted by Borrower, (2)&nbsp;relating to (a)&nbsp;the existence of any Hazardous
Materials contamination or Environmental Discharges or threatened Hazardous
Materials contamination or Environmental Discharges at any of Borrower<B>&#146;</B>s
locations or facilities or (b)&nbsp;remediation of any Environmental Discharge or
Hazardous Materials at any such location or facility or any part thereof; or
(3)&nbsp;relating to any violation or alleged violation by Borrower of any relevant
Environmental Law.


<P align="left" style="font-size: 10pt">&#147;<B><I>ERISA</I></B>&#148; means the Employee Retirement Income Security Act of 1974, including
the rules and regulations promulgated thereunder.


<P align="left" style="font-size: 10pt">&#147;<B><I>ERISA Affiliate</I></B>&#148; means any corporation which is a member of the same
controlled group of corporations (within the meaning of Section 414(b) of the
Code) as Borrower, or any trade or business which is under common control
(within the meaning of Section 414(c) of the Code) with Borrower, or any
organization which is required to be treated as a single employer with Borrower
under Section 414(m) or 414(o) of the Code.


<P align="left" style="font-size: 10pt">&#147;<B><I>Event of Default</I></B>&#148; has the meaning specified in Section&nbsp;9.01.


<P align="left" style="font-size: 10pt">&#147;<B><I>Extension Option</I></B>&#148; and &#147;<B><I>Notice to Extend</I></B>&#148; have the respective meanings
specified in Section&nbsp;2.18.


<P align="left" style="font-size: 10pt">&#147;<B><I>Facility Fee Rate</I></B>&#148; means the rate per annum determined, at any time, based on
Borrower&#146;s Credit Rating in accordance with the following table. Any change in
Borrower&#146;s Credit Rating which



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<P align="left" style="font-size: 10pt">causes it to move into a different range on the table shall effect an immediate
change in the Facility Fee Rate.


<DIV align="center">
    <TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="55%">
      <!-- Begin Table Head -->
      <TR valign="bottom">
        <TD width="90%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="2%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="2%">&nbsp;</TD>
      </TR>

      <TR style="font-size: 1px">
        <TD colspan="5" align="left"><HR size="1" noshade> &nbsp;</TD>
      </TR>

      <TR style="font-size: 8pt" valign="bottom">
        <TD nowrap align="left">Borrower's Credit Rating (S&#038;P/Moody's)</TD>
        <TD>&nbsp;</TD>
        <TD nowrap align="center" colspan="3">Facility Fee Rate</TD>
      </TR>
      <TR style="font-size: 8pt" valign="bottom">
        <TD nowrap align="left"><B>&nbsp;</B></TD>
        <TD>&nbsp;</TD>
        <TD nowrap align="center" colspan="3">(% per annum)</TD>
      </TR>
      <!-- End Table Head -->
      <!-- Begin Table Body -->
      <TR style="font-size: 1px">
        <TD colspan="5" align="left"><HR size="1" noshade> &nbsp;</TD>
      </TR>
      <TR valign="bottom" style="background: #eeeeee">
        <TD><DIV style="margin-left:10px; text-indent:-10px">Below BBB- or unrated/Below
            Baa3 or unrated</DIV></TD>
        <TD>&nbsp;</TD>
        <TD>&nbsp;</TD>
        <TD align="right">0.25</TD>
        <TD>&nbsp;</TD>
      </TR>
      <TR style="font-size: 1px">
        <TD colspan="5" align="left"><HR size="1" noshade> &nbsp;</TD>
      </TR>
      <TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px">BBB-/Baa3</DIV></TD>
        <TD>&nbsp;</TD>
        <TD>&nbsp;</TD>
        <TD align="right">0.20</TD>
        <TD>&nbsp;</TD>
      </TR>
      <TR style="font-size: 1px">
        <TD colspan="5" align="left"><HR size="1" noshade> &nbsp;</TD>
      </TR>
      <TR valign="bottom" style="background: #eeeeee">
        <TD><DIV style="margin-left:10px; text-indent:-10px">BBB/Baa2</DIV></TD>
        <TD>&nbsp;</TD>
        <TD>&nbsp;</TD>
        <TD align="right">0.15</TD>
        <TD>&nbsp;</TD>
      </TR>
      <TR style="font-size: 1px">
        <TD colspan="5" align="left"><HR size="1" noshade> &nbsp;</TD>
      </TR>
      <TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px">BBB&#043;/Baa1</DIV></TD>
        <TD>&nbsp;</TD>
        <TD>&nbsp;</TD>
        <TD align="right">0.15</TD>
        <TD>&nbsp;</TD>
      </TR>
      <TR style="font-size: 1px">
        <TD colspan="5" align="left"><HR size="1" noshade> &nbsp;</TD>
      </TR>
      <TR valign="bottom" style="background: #eeeeee">
        <TD><DIV style="margin-left:10px; text-indent:-10px">A- or higher/A3 or
            higher</DIV></TD>
        <TD>&nbsp;</TD>
        <TD>&nbsp;</TD>
        <TD align="right">0.15</TD>
        <TD>&nbsp;</TD>
      </TR>
      <TR style="font-size: 1px">
        <TD colspan="5" align="left"><HR size="1" noshade> &nbsp;</TD>
      </TR>
      <!-- End Table Body -->
    </TABLE>
</DIV>


<P align="left" style="font-size: 10pt">&#147;<b><I>Federal Funds Rate</I></B>&#148; means, for any day, the rate per annum (expressed on a
360-day basis of calculation) equal to the weighted average of the rates on
overnight federal funds transactions as published by the Federal Reserve Bank
of New York for such day provided that (1)&nbsp;if such day is not a Banking Day,
the Federal Funds Rate for such day shall be such rate on such transactions on
the immediately preceding Banking Day as so published on the next succeeding
Banking Day; and (2)&nbsp;if no such rate is so published on such next succeeding
Banking Day, the Federal Funds Rate for such day shall be the average of the
rates quoted by three (3)&nbsp;Federal Funds brokers to Administrative Agent on such
day on such transactions.


<P align="left" style="font-size: 10pt">&#147;<b><I>First Solicitation</I></B>&#148; has the meaning specified in Section&nbsp;2.19.


<P align="left" style="font-size: 10pt">&#147;<b><I>Fiscal Year</I></B>&#148; means each period from January 1 to December&nbsp;31.


<P align="left" style="font-size: 10pt">&#147;<b><I>Fleet</I></B>&#148; has the meaning specified in the preamble.


<P align="left" style="font-size: 10pt">&#147;<b><I>Funds From Operations</I></B>&#148; means &#147;funds from operations&#148; as defined in accordance
with resolutions adopted by the Board of Governors of the National Association
of Real Estate Investment Trusts as in effect from time to time.


<P align="left" style="font-size: 10pt">&#147;<b><I>GAAP</I></B>&#148; means generally accepted accounting principles in the United States of
America as in effect from time to time, applied on a basis consistent with
those used in the preparation of the financial statements referred to in
Section&nbsp;5.13 (except for changes concurred in by Borrower&#146;s Accountants).


<P align="left" style="font-size: 10pt">&#147;<b><I>Good Faith Contest</I></B>&#148; means the contest of an item if: (1)&nbsp;the item is
diligently contested in good faith, and, if appropriate, by proceedings timely
instituted; (2)&nbsp;reserves that are adequate based on reasonably foreseeable
likely outcomes are established with respect to the contested item; (3)&nbsp;during
the period of such contest, the enforcement of any contested item is
effectively stayed, delayed or postponed; and (4)&nbsp;the failure to pay or comply
with the contested item during the period of the contest is not likely to
result in a Material Adverse Change.


<P align="left" style="font-size: 10pt">&#147;<b><I>Governmental Approvals</I></B>&#148; means any authorization, consent, approval, license,
permit, certification, or exemption of, registration or filing with or report
or notice to, any Governmental Authority.



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<P align="left" style="font-size: 10pt">&#147;<b><I>Governmental Authority</I></B>&#148; means any nation or government, any state or other
political subdivision thereof, and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.


<P align="left" style="font-size: 10pt">&#147;<b><I>Hazardous Materials</I></B>&#148; means any pollutant, effluents, emissions, contaminants,
toxic or hazardous wastes or substances, as any of those terms are defined from
time to time in or for the purposes of any relevant Environmental Law,
including asbestos fibers and friable asbestos, polychlorinated biphenyls, and
any petroleum or hydrocarbon-based products or derivatives.


<P align="left" style="font-size: 10pt">&#147;<b><I>Initial Advance</I></B>&#148; means the first advance of proceeds of the Loans.


<P align="left" style="font-size: 10pt">&#147;<b><I>Interest Expense</I></B>&#148; means, for any period of time, Borrower&#146;s share of the
consolidated interest expense (without deduction of consolidated interest
income, and excluding (x)&nbsp;interest expense on construction loans and (y)&nbsp;other
capitalized interest expense in respect of either construction activity or
construction loans, in any such case under clauses (x)&nbsp;or (y), only until
completion of the relevant construction) of Borrower and its Consolidated
Businesses, including, without limitation or duplication (or, to the extent not
so included, with the addition of), (1)&nbsp;the portion of any rental obligation in
respect of any Capital Lease obligation allocable to interest expense in
accordance with GAAP; (2)&nbsp;the amortization of Debt discounts; (3)&nbsp;any expense,
payments or fees (other than up-front fees) with respect to interest rate swap
or similar agreements; and (4)&nbsp;the interest expense and items listed in clauses
(1)&nbsp;through (3)&nbsp;above applicable to each of the UJVs multiplied by Borrower&#146;s
respective beneficial interests in the UJVs, in all cases as reflected in
Borrower&#146;s Consolidated Financial Statements.


<P align="left" style="font-size: 10pt">&#147;<b><I>Interest Period</I></B>&#148; means, (1)&nbsp;with respect to any LIBOR Loan, the period
commencing on the date the same is advanced, Converted from a Base Rate Loan or
Continued, as the case may be, and ending, as Borrower may select pursuant to
Section&nbsp;2.05, on the numerically corresponding day in the first, second or
third calendar month thereafter, provided that each such Interest Period which
commences on the last Banking Day of a calendar month (or on any day for which
there is no numerically corresponding day in the appropriate subsequent
calendar month) shall end on the last Banking Day of the appropriate calendar
month; (2)&nbsp;with respect to any LIBOR Bid Rate Loan, the period commencing on
the date the same is advanced and ending, as Borrower may select pursuant to
Section&nbsp;2.02, on the numerically corresponding day in the first, second or
third calendar month thereafter, provided that each such Interest Period which
commences on the last Banking Day of a calendar month (or on any day for which
there is no numerically corresponding day in the appropriate subsequent
calendar month) shall end on the last Banking Day of the appropriate calendar
month; and (3)&nbsp;with respect to any Absolute Bid Rate Loan, the period
commencing on the date the same is advanced and ending, as Borrower may select
pursuant to Section&nbsp;2.02, provided, however, that each such period shall not be
less than fourteen (14)&nbsp;days nor more than ninety (90)&nbsp;days.


<P align="left" style="font-size: 10pt">&#147;<b><I>Invitation for Bid Rate Quotes</I></B>&#148; has the meaning specified in Section&nbsp;2.02 (b).


<P align="left" style="font-size: 10pt">&#147;<b><I>Issuing Bank</I></B>&#148; means Fleet in its capacity as issuing bank of the Letters of
Credit under the Letter of Credit facility described in Section&nbsp;2.16, and its
successors in such capacity.


<P align="left" style="font-size: 10pt">&#147;<b><I>JPMC</I></B>&#148; has the meaning specified in the preamble.



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<P align="left" style="font-size: 10pt">&#147;<b><I>Law</I></B>&#148; means any federal, state or local statute, law, rule, regulation,
ordinance, order, code, or rule of common law, now or hereafter in effect, and
in each case as amended, and any judicial or administrative order, consent
decree or judgment.


<P align="left" style="font-size: 10pt">&#147;<b><I>Letter of Credit</I></B>&#148; has the meaning specified in Section&nbsp;2.16(a).


<P align="left" style="font-size: 10pt">&#147;<b><I>LIBOR Auction</I></B>&#148; means a solicitation of Bid Rate Quotes setting forth LIBOR Bid
Margins pursuant to Section&nbsp;2.02.


<P align="left" style="font-size: 10pt">&#147;<b><I>LIBOR Base Rate</I></B>&#148; means, with respect to any Interest Period therefor, the rate
per annum (rounded up, if necessary, to the nearest 1/100 of 1%) that appears
on Dow Jones Page 3750 at approximately 11:00&nbsp;a.m. (London time) on the date
(the &#147;<B><I>LIBOR Determination Date</I></B>&#148;) two (2)&nbsp;Banking Days prior to the first day of
the applicable Interest Period, for the same period of time as the Interest
Period; or, if such rate does not appear on Dow Jones Page 3750 as of
approximately 11:00&nbsp;a.m. (London time) on the LIBOR Determination Date, the
rate (rounded up, if necessary, to the nearest 1/100 of 1%) for deposits in
Dollars for a period comparable to the applicable Interest Period that appears
on the Reuters Screen LIBOR Page as of approximately 11:00&nbsp;a.m. (London time)
on the LIBOR Determination Date. If such rate does not appear on either Dow
Jones Page 3750 or on the Reuters Screen LIBOR Page as of approximately 11:00
a.m. (London time) on the LIBOR Determination Date, the LIBOR Base Rate for the
Interest Period will be determined on the basis of the offered rates for
deposits in Dollars for the same period of time as such Interest Period that
are offered by four (4)&nbsp;major banks in the London interbank market at
approximately 11:00&nbsp;a.m. (London time) on the LIBOR Determination Date.
Administrative Agent will request that the principal London office of each of
the four (4)&nbsp;major banks provide a quotation of its Dollar deposit offered
rate. If at least two (2)&nbsp;such quotations are provided, the LIBOR Base Rate
will be the arithmetic mean of the quotations. If fewer than two (2)
quotations are provided as requested, the LIBOR Base Rate will be determined on
the basis of the rates quoted for loans in Dollars to leading European banks
for amounts comparable to such amount requested by Borrower for the same period
of time as such Interest Period offered by major banks in New York City at
approximately 11:00&nbsp;a.m. (New York time) on the LIBOR Determination Date. In
the event that Administrative Agent is unable to obtain any such quotation as
provided above, it will be deemed that the LIBOR Base Rate cannot be
determined. For purposes of the foregoing definition, &#147;Dow Jones Page 3750&#148;
means the display designated as &#147;Page 3750&#148; on the Dow Jones Markets Service
(or such other page as may replace Page 3750 on that service or such other
service as may be nominated by the British Bankers&#146; Association as the
information vendor for the purpose of displaying British Bankers&#146; Association
Interest Settlement Rates for Dollar deposits); and &#147;Reuters Screen LIBOR Page&#148;
means the display designated as page &#147;LIBO&#148; on the Reuters Monitor Money Rates
Service (or such other page as may replace the LIBO page on that service for
the purpose of displaying interbank rates from London in Dollars).


<P align="left" style="font-size: 10pt">&#147;<b><I>LIBOR Bid Margin</I></B>&#148; has the meaning specified in Section&nbsp;2.02(c)(2).


<P align="left" style="font-size: 10pt">&#147;<b><I>LIBOR Bid Rate</I></B>&#148; means the rate per annum equal to the sum of (1)&nbsp;the LIBOR
Interest Rate for the LIBOR Bid Rate Loan and Interest Period in question and
(2)&nbsp;the LIBOR Bid Margin.


<P align="left" style="font-size: 10pt">&#147;<b><I>LIBOR Bid Rate Loan</I></B>&#148; means a Bid Rate Loan bearing interest at the LIBOR Bid
Rate.



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<P align="left" style="font-size: 10pt">&#147;<b><I>LIBOR Interest Rate</I></B>&#148; means, for any LIBOR Loan or LIBOR Bid Rate Loan, a rate
per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%)
determined by Administrative Agent to be equal to the quotient of (1)&nbsp;the LIBOR
Base Rate for such LIBOR Loan or LIBOR Bid Rate Loan, as the case may be, for
the Interest Period therefor divided by (2)&nbsp;one minus the LIBOR Reserve
Requirement for such LIBOR Loan or LIBOR Bid Rate Loan, as the case may be, for
such Interest Period.


<P align="left" style="font-size: 10pt">&#147;<b><I>LIBOR Loan</I></B>&#148; means all or any portion (as the context requires) of any Bank&#146;s
Ratable Loan which shall accrue interest at rate(s) determined in relation to
LIBOR Interest Rate(s).


<P align="left" style="font-size: 10pt">&#147;<b><I>LIBOR Reserve Requirement</I></B>&#148; means, for any LIBOR Loan or LIBOR Bid Rate Loan,
the average maximum rate at which reserves (including any marginal,
supplemental or emergency reserves) are required to be maintained during the
Interest Period for such LIBOR Loan or LIBOR Bid Rate Loan under Regulation&nbsp;D
by member banks of the Federal Reserve System in New York City with deposits
exceeding $1,000,000,000 against &#147;Eurocurrency liabilities&#148; (as such term is
used in Regulation&nbsp;D). Without limiting the effect of the foregoing, the LIBOR
Reserve Requirement shall also reflect any other reserves required to be
maintained by such member banks by reason of any Regulatory Change against (1)
any category of liabilities which includes deposits by reference to which the
LIBOR Base Rate is to be determined as provided in the definition of &#147;LIBOR
Base Rate&#148; in this Section&nbsp;1.01 or (2)&nbsp;any category of extensions of credit or
other assets which include loans the interest rate on which is determined on
the basis of rates referred to in said definition of &#147;LIBOR Base Rate&#148;.


<P align="left" style="font-size: 10pt">&#147;<b><I>Lien</I></B>&#148; means any mortgage, deed of trust, pledge, negative pledge, security
interest, hypothecation, assignment for collateral purposes, deposit
arrangement, lien (statutory or other), or other security agreement or charge
of any kind or nature whatsoever of any third party (excluding any right of
setoff but including, without limitation, any conditional sale or other title
retention agreement, any financing lease having substantially the same economic
effect as any of the foregoing, and the filing of any financing statement under
the Uniform Commercial Code or comparable Law of any jurisdiction to evidence
any of the foregoing and carriers, warehousemen, mechanics and other similar
inchoate liens that have not been insured against in a manner reasonably
satisfactory to Administrative Agent).


<P align="left" style="font-size: 10pt">&#147;<b><I>Loan</I></B>&#148; means, with respect to each Bank, collectively, its Ratable Loan and Bid
Rate Loan(s), and, in the case of the Swing Lender, its Swing Loan(s).


<P align="left" style="font-size: 10pt">&#147;<b><I>Loan Commitment</I></B>&#148; means, with respect to each Bank, the obligation to make a
Ratable Loan in the principal amount set forth in Schedule&nbsp;1 (subject to change
in accordance with the terms of this Agreement).


<P align="left" style="font-size: 10pt">&#147;<b><I>Loan Documents</I></B>&#148; means this Agreement, the Notes, the Authorization Letter and
the Solvency Certificate.


<P align="left" style="font-size: 10pt">&#147;<b><I>Majority Banks</I></B>&#148; means at any time the Banks having Pro Rata Shares aggregating
at least 51%; provided, however, that during the existence of an Event of
Default, the &#147;<B><I>Majority Banks</I></B>&#148; shall be the Banks holding at least 51% of the
then aggregate unpaid principal amount of the Loans. For purposes of this
definition, a Bank&#146;s Loan shall be deemed to include its participating interest
in



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<P align="left" style="font-size: 10pt">Swing Loans pursuant to Section&nbsp;2.17(c) and the Swing Lender&#146;s Loans shall be
deemed to exclude such participating interests of other Banks.


<P align="left" style="font-size: 10pt">&#147;<b><I>Material Adverse Change</I></B>&#148; means an effect resulting from any circumstance or
event or series of circumstances or events, of whatever nature, which does or
could reasonably be expected to, on more than an interim basis, either (1)
materially and adversely impair the ability of Borrower and its Consolidated
Businesses, taken as a whole, to fulfill its material obligations or (2)&nbsp;cause
a Default or an Event of Default.


<P align="left" style="font-size: 10pt">&#147;<b><I>Material Affiliates</I></B>&#148; means the Affiliates of Borrower described on <B>EXHIBIT C</B>,
together with (or excluding) any Affiliates of Borrower which are hereafter
from time to time reasonably determined by Administrative Agent to be material
(or no longer material), upon written notice to Borrower, based on the most
recent Borrower&#146;s Consolidated Financial Statements.


<P align="left" style="font-size: 10pt">&#147;<b><I>Maturity Date</I></B>&#148; means May&nbsp;24, 2007, subject to extension in accordance with
Section&nbsp;2.18.


<P align="left" style="font-size: 10pt">&#147;<b><I>Moody&#146;s</I></B>&#148; means Moody&#146;s Investors Service, Inc.


<P align="left" style="font-size: 10pt">&#147;<b><I>Multiemployer Plan</I></B>&#148; means a Plan defined as such in Section&nbsp;3(37) of ERISA to
which contributions have been made by Borrower or any ERISA Affiliate and which
is covered by Title IV of ERISA.


<P align="left" style="font-size: 10pt">&#147;<b><I>New Bank</I></B>&#148; and &#147;<B><I>New Note</I></B>&#148; have the respective meanings specified in Section
2.19.


<P align="left" style="font-size: 10pt">&#147;<b><I>Note</I></B>&#148; and &#147;<B><I>Notes</I></B>&#148; have the respective meanings specified in Section&nbsp;2.08.


<P align="left" style="font-size: 10pt">&#147;<b><I>Obligations</I></B>&#148; means each and every obligation, covenant and agreement of
Borrower, now or hereafter existing, contained in this Agreement, and any of
the other Loan Documents, whether for principal, reimbursement obligations,
interest, fees, expenses, indemnities or otherwise, and any amendments or
supplements thereto, extensions or renewals thereof or replacements therefor,
including but not limited to all indebtedness, obligations and liabilities of
Borrower to Administrative Agent and any Bank now existing or hereafter
incurred under or arising out of or in connection with the Notes, this
Agreement, the other Loan Documents, and any documents or instruments executed
in connection therewith; in each case whether direct or indirect, joint or
several, absolute or contingent, liquidated or unliquidated, now or hereafter
existing, renewed or restructured, whether or not from time to time decreased
or extinguished and later increased, created or incurred, and including all
indebtedness of Borrower, under any instrument now or hereafter evidencing or
securing any of the foregoing.


<P align="left" style="font-size: 10pt">&#147;<b><I>Parent</I></B>&#148; means, with respect to any Bank, any Person controlling such Bank.


<P align="left" style="font-size: 10pt">&#147;<b><I>Participant</I></B>&#148; and &#147;<B><I>Participation</I></B>&#148; have the respective meanings specified in
Section&nbsp;12.05.


<P align="left" style="font-size: 10pt">&#147;<b><I>PBGC</I></B>&#148; means the Pension Benefit Guaranty Corporation and any entity succeeding
to any or all of its functions under ERISA.



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<P align="left" style="font-size: 10pt">&#147;<b><I>Person</I></B>&#148; means an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated
association, joint venture, Governmental Authority or other entity of whatever
nature.


<P align="left" style="font-size: 10pt">&#147;<b><I>Plan</I></B>&#148; means any employee benefit or other plan established or maintained, or
to which contributions have been made, by Borrower or any ERISA Affiliate and
which is covered by Title IV of ERISA or to which Section&nbsp;412 of the Code
applies.


<P align="left" style="font-size: 10pt">&#147;<b><I>presence</I></B>&#148;, when used in connection with any Environmental Discharge or
Hazardous Materials, means and includes presence, generation, manufacture,
installation, treatment, use, storage, handling, repair, encapsulation,
disposal, transportation, spill, discharge and release.


<P align="left" style="font-size: 10pt">&#147;<b><I>Prime Rate</I></B>&#148; means the variable per annum rate of interest designated from time
to time by Administrative Agent at its principal office as its &#147;prime rate&#148; (it
being understood that the &#147;prime rate&#148; is a reference rate and does not
necessarily represent the lowest or best rate being charged to any customer).


<P align="left" style="font-size: 10pt">&#147;<b><I>Pro Rata Share</I></B>&#148; means, for purposes of this Agreement and with respect to each
Bank, a fraction, the numerator of which is the amount of such Bank&#146;s Loan
Commitment and the denominator of which is the Total Loan Commitment.


<P align="left" style="font-size: 10pt">&#147;<b><I>Prohibited Transaction</I></B>&#148; means any transaction proscribed by Section&nbsp;406 of
ERISA or Section&nbsp;4975 of the Code and to which no statutory or administrative
exemption applies.


<P align="left" style="font-size: 10pt">&#147;<b><I>Ratable Loan</I></B>&#148; has the meaning specified in Section&nbsp;2.01(b).


<P align="left" style="font-size: 10pt">&#147;<b><I>Ratable Loan Note</I></B>&#148; has the meaning specified in Section&nbsp;2.08.


<P align="left" style="font-size: 10pt">&#147;<b><I>Recourse Debt</I></B>&#148; means Debt, recourse for the satisfaction of which is not
limited to specified collateral.


<P align="left" style="font-size: 10pt">&#147;<b><I>Refunded Swing Loans</I></B>&#148; and &#147;<B><I>Refunding Date</I></B>&#148; have the respective meanings
specified in Section&nbsp;2.17.


<P align="left" style="font-size: 10pt">&#147;<b><I>Regulation&nbsp;D</I></B>&#148; means Regulation&nbsp;D of the Board of Governors of the Federal
Reserve System.


<P align="left" style="font-size: 10pt">&#147;<b><I>Regulation&nbsp;U</I></B>&#148; means Regulation&nbsp;U of the Board of Governors of the Federal
Reserve System.


<P align="left" style="font-size: 10pt">&#147;<b><I>Regulatory Change</I></B>&#148; means, with respect to any Bank, any change after the date
of this Agreement in United States federal, state, municipal or foreign laws or
regulations (including Regulation&nbsp;D) or the adoption or making after such date
of any interpretations, directives or requests applying to a class of banks
including such Bank of or under any United States, federal, state, municipal or
foreign laws or regulations (whether or not having the force of law) by any
court or governmental or monetary authority charged with the interpretation or
administration thereof.


<P align="left" style="font-size: 10pt">&#147;<b><I>Reportable Event</I></B>&#148; means any of the events set forth in Section 4043(c) of
ERISA, other than those events as to which the thirty (30)&nbsp;day notice period is
waived under subsections .13, .14, .16, .18, .19 or .20 of PBGC Reg. &#167;2615.



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<P align="left" style="font-size: 10pt">&#147;<b><I>Requested Increase</I></B>&#148; has the meaning specified in Section&nbsp;2.19.


<P align="left" style="font-size: 10pt">&#147;<b><I>Secured Indebtedness</I></B>&#148; means that portion of Total Outstanding Indebtedness
that is secured by a Lien.


<P align="left" style="font-size: 10pt">&#147;<b><I>Shortfall</I></B>&#148; has the meaning specified in Section&nbsp;2.19.


<P align="left" style="font-size: 10pt">&#147;<b><I>Solvency Certificate</I></B>&#148; means a certificate in the form of <B>EXHIBIT D</B>, to be
delivered by Borrower pursuant to the terms of this Agreement.


<P align="left" style="font-size: 10pt">&#147;<b><I>Solvent</I></B>&#148; means, when used with respect to any Person, that the fair value of
the property of such Person, on a going concern basis, is greater than the
total amount of liabilities (including, without limitation, contingent
liabilities) of such Person.


<P align="left" style="font-size: 10pt">&#147;<b><I>S&#038;P</I></B>&#148; means Standard and Poor&#146;s Ratings Services, a division of McGraw-Hill
Companies.


<P align="left" style="font-size: 10pt">&#147;<b><I>Super-Majority Banks</I></B>&#148; means at any time the Banks having Pro Rata Shares
aggregating at least 66-2/3%; provided, however, that during the existence of
an Event of Default, the &#147;Super-Majority Banks&#148; shall be the Banks holding at
least 66-2/3% of the then aggregate unpaid principal amount of the Loans. For
purposes of this definition, a Bank&#146;s Loan shall be deemed to include its
participating interest in Swing Loans pursuant to Section&nbsp;2.17(c) and the Swing
Lender&#146;s Loans shall be deemed to exclude such participating interests of other
Banks.


<P align="left" style="font-size: 10pt">&#147;<b><I>Supplemental Fee Letter</I></B>&#148; means, collectively, those certain letter agreements,
each dated as of April&nbsp;19, 2004, between Borrower and JPMC.


<P align="left" style="font-size: 10pt">&#147;<b><I>Supplemental Note</I></B>&#148; has the meaning specified in Section&nbsp;2.19.


<P align="left" style="font-size: 10pt">&#147;<b><I>Swing Lender</I></B>&#148; means Fleet in its capacity as the lender under the Swing Loan
facility described in Section&nbsp;2.17, and its successors in such capacity.


<P align="left" style="font-size: 10pt">&#147;<b><I>Swing Loan</I></B>&#148; means a loan made by the Swing Lender pursuant to Section&nbsp;2.17.


<P align="left" style="font-size: 10pt">&#147;<b><I>Swing Loan Commitment</I></B>&#148; means $20,000,000.


<P align="left" style="font-size: 10pt">&#147;<b><I>Swing Loan Note</I></B>&#148; has the meaning specified in Section&nbsp;2.08.


<P align="left" style="font-size: 10pt">&#147;<b><I>Swing Loan Refund Amount</I></B>&#148; has the meaning specified in Section&nbsp;2.17.


<P align="left" style="font-size: 10pt">&#147;<b><I>Syndication Agent</I></B>&#148; means JPMorgan Chase Bank.


<P align="left" style="font-size: 10pt">&#147;<b><I>Syndication Expiration Date</I></B>&#148; has the meaning specified in Section&nbsp;2.19.


<P align="left" style="font-size: 10pt">&#147;<b><I>Total Loan Commitment</I></B>&#148; means an amount equal to the aggregate amount of all
Loan Commitments (i.e., initially, $500,000,000), as the same may increase
pursuant to Section&nbsp;2.19 or decrease pursuant to Section&nbsp;2.10.



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<P align="left" style="font-size: 10pt">&#147;<b><I>Total Outstanding Indebtedness</I></B>&#148; means, at any time, the sum, without
duplication, of (1)&nbsp;Consolidated Outstanding Indebtedness; (2)&nbsp;Borrower&#146;s Share
of UJV Combined Outstanding Indebtedness; and (3)&nbsp;Contingent Obligations.


<P align="left" style="font-size: 10pt">&#147;<b><I>UJV Combined Outstanding Indebtedness</I></B>&#148; means, as of any time, all indebtedness
and liability for borrowed money, secured or unsecured, of the UJV&#146;s, on a
combined basis, including mortgage and other notes payable but excluding any
indebtedness which is margin indebtedness on cash and cash equivalent
securities, all as reflected in the balance sheets of each of the UJVs,
prepared in accordance with GAAP.


<P align="left" style="font-size: 10pt">&#147;<b><I>UJVs</I></B>&#148; means the unconsolidated joint ventures (including general and limited
partnerships) in which Borrower owns a beneficial interest and which are
accounted for under the equity method in Borrower&#146;s Consolidated Financial
Statements.


<P align="left" style="font-size: 10pt">&#147;<b><I>Unencumbered Asset Value</I></B>&#148; means, as of the end of any calendar quarter,
without duplication, (1)&nbsp;Unencumbered Combined EBITDA for such quarter,
annualized (i.e., multiplied by four (4)), capitalized at a rate of 8.0% per
annum (i.e., divided by 8.0%) plus (2)&nbsp;Unencumbered Land and
Construction-in-Process, valued at cost in accordance with GAAP (up to a
maximum of 10% of Unencumbered Asset Value), plus (3)&nbsp;Unencumbered Wholly-Owned
Assets owned for less than twelve (12)&nbsp;months, valued at cost in accordance
with GAAP, plus (4)&nbsp;the portion of Combined EBITDA for such quarter annualized,
capitalized at 8.0% per annum (i.e., divided by 8.0%), which is attributable to
assets that have been completed for more than twelve (12)&nbsp;months and would
qualify as Unencumbered Wholly-Owned Assets except that they have not achieved
the occupancy requirements set forth in clause (2)&nbsp;of the definition of
Unencumbered Wholly-Owned Assets (up to a maximum of 10% of Unencumbered Asset
Value).


<P align="left" style="font-size: 10pt">&#147;<b><I>Unencumbered Combined EBITDA</I></B>&#148; means that portion of Combined EBITDA
attributable to Unencumbered Wholly-Owned Assets (assuming general and
administrative expense is allocated proportionately to Unencumbered
Wholly-Owned Assets).


<P align="left" style="font-size: 10pt">&#147;<b><I>Unencumbered Land and Construction-in-Process</I></B>&#148; means all land held for future
development and Construction-in-Process reflected on Borrower&#146;s Consolidated
Financial Statements, wholly-owned, directly or indirectly, by Borrower which
are not, and the direct or indirect interests of Borrower therein are not,
subject to any lien to secure all or any portion of Secured Indebtedness or any
other encumbrances which in the reasonable judgment of the Administrative Agent
may diminish the value of the asset in question.


<P align="left" style="font-size: 10pt">&#147;<b><I>Unencumbered Wholly-Owned Assets</I></B>&#148; means income-producing assets, reflected on
Borrower&#146;s Consolidated Financial Statements, wholly owned, directly or
indirectly, by Borrower which (1)&nbsp;are not, and the direct or indirect interests
of Borrower therein are not, subject to any Lien to secure all or any portion
of Secured Indebtedness or any other encumbrances which, in the reasonable
judgment of Administrative Agent, may diminish the value of the asset in
question and (2)&nbsp;complies with the occupancy requirements set forth in the
immediately following sentence. In order to qualify as an Unencumbered
Wholly-Owned Asset for a particular calendar quarter an asset must (1)&nbsp;have
average occupancy for the twelve (12)-month period ending with such quarter of
80% or more and (2)&nbsp;have average quarterly occupancy for at least three (3)&nbsp;of
the four (4)&nbsp;calendar quarters during such twelve (12)-month period of 80% or
more.



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<P align="left" style="font-size: 10pt">&#147;<b><I>Unsecured Indebtedness</I></B>&#148; means that portion of Total Outstanding Indebtedness
that is not secured by a Lien.


<P align="left" style="font-size: 10pt">&#147;<b><I>Unsecured Interest Expense</I></B>&#148; means that portion of Interest Expense relating to
Unsecured Indebtedness.



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;1.02 </B><u><B>Accounting Terms</B></u>. All accounting terms not
specifically defined herein shall be construed in accordance with GAAP, and all
financial data required to be delivered hereunder shall be prepared in
accordance with GAAP.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;1.03 </B><u><B>Computation of Time Periods</B></u>. Except as otherwise
provided herein, in this Agreement, in the computation of periods of time from
a specified date to a later specified date, the word &#147;from&#148; means &#147;from and
including&#148; and words &#147;to&#148; and &#147;until&#148; each means &#147;to but excluding&#148;.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;1.04 </B><u><B>Rules of Construction</B></u>. Except as provided otherwise,
when used in this Agreement (1) &#147;or&#148; is not exclusive; (2)&nbsp;a reference to a Law
includes any amendment, modification or supplement to, or replacement of, such
Law; (3)&nbsp;a reference to a Person includes its permitted successors and
permitted assigns; (4)&nbsp;all terms used in the singular shall have a correlative
meaning when used in the plural and vice versa; (5)&nbsp;a reference to an
agreement, instrument or document shall include such agreement, instrument or
document as the same may be amended, modified or supplemented from time to time
in accordance with its terms and as permitted by the Loan Documents; (6)&nbsp;all
references to Articles, Sections or Exhibits shall be to Articles, Sections and
Exhibits of this Agreement unless otherwise indicated; (7) &#147;hereunder&#148;,
&#147;herein&#148;, &#147;hereof&#148; and the like refer to this Agreement as a whole; and (8)&nbsp;all
Exhibits to this Agreement shall be incorporated into this Agreement.


<P align="center" style="font-size: 10pt"><B>ARTICLE II</B>


<P align="center" style="font-size: 10pt"><B>THE LOANS</B>


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.01 </B><u><B>Ratable Loans; Bid Rate Loans; Purpose</B></u>.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Subject to the terms and conditions of this Agreement, the Banks agree
to make loans to Borrower as provided in this Article&nbsp;II.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;Each of the Banks severally agrees to make loans to Borrower (each
such loan by a Bank, a &#147;<B><I>Ratable Loan</I></B>&#148;) in an amount up to its Loan Commitment,
pursuant to which the Bank shall from time to time advance and re-advance to
Borrower an amount equal to its Pro Rata Share of the excess (the &#147;<B><I>Available
Total Loan Commitment</I></B>&#148;) of the Total Loan Commitment over the sum of (1)&nbsp;all
previous advances (including Bid Rate Loans and Swing Loans) made by the Banks
which remain unpaid and (2)&nbsp;the outstanding amount of all Letters of Credit and
unreimbursed drawings on all Letters of Credit. Within the limits set forth
herein, Borrower may borrow from time to time under this paragraph (b)&nbsp;and
prepay from time to time pursuant to Section&nbsp;2.09 (subject, however, to the
restrictions on prepayment set forth in said Section), and thereafter re-borrow
pursuant to this paragraph (b). The Ratable Loans may be outstanding as (1)
Base Rate Loans; (2)&nbsp;LIBOR Loans; or (3)&nbsp;a combination of the foregoing, as
Borrower shall elect and notify


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<P align="left" style="font-size: 10pt">Administrative Agent in accordance with Section&nbsp;2.14. The LIBOR Loan, Bid
Rate Loan and Base Rate Loan of each Bank shall be maintained at such Bank&#146;s
Applicable Lending Office.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;In addition to Ratable Loans pursuant to paragraph (b)&nbsp;above, so long
as Borrower&#146;s Credit Rating is BBB- or higher by S&#038;P or Baa3 or higher by
Moody&#146;s or an equivalent rating by another nationally-recognized rating agency,
as reasonably approved by Administrative Agent, one or more Banks may, at
Borrower&#146;s request and in their sole discretion, make non-ratable loans which
shall bear interest at the LIBOR Bid Rate or the Absolute Bid Rate in
accordance with Section&nbsp;2.02 (such loans being referred to in this Agreement as
&#147;<b><I>Bid Rate Loans</I></B>&#148;). Borrower may borrow Bid Rate Loans from time to time
pursuant to this paragraph (c)&nbsp;in an amount up to the Available Total Loan
Commitment at the time of the borrowing (taking into account any repayments of
the Loans made simultaneously therewith) and shall repay such Bid Rate Loans as
required by Section&nbsp;2.08, and it may thereafter re-borrow pursuant to this
paragraph (c); provided, however, that the aggregate outstanding principal
amount of Bid Rate Loans at any particular time shall not exceed the Bid
Borrowing Limit.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;The obligations of the Banks under this Agreement are several, and no
Bank shall be responsible for the failure of any other Bank to make any advance
of a Loan to be made by such other Bank. However, the failure of any Bank to
make any advance of the Loan to be made by it hereunder on the date specified
therefor shall not relieve any other Bank of its obligation to make any advance
of its Loan specified hereby to be made on such date.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;Borrower shall use the proceeds of the Loans for general capital and
working capital requirements of Borrower and its Consolidated Businesses and
UJVs (which shall include, but not be limited to, Acquisitions and/or costs
incurred in connection with the development, construction or reconstruction of
multi-family real estate properties). In no event shall proceeds of the Loans
be used in a manner that would violate Regulation&nbsp;U or in connection with a
hostile acquisition.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.02 </B><u><B>Bid Rate Loans</B></u>.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;When Borrower wishes to request offers from the Banks to make Bid Rate
Loans, it shall transmit to Administrative Agent by facsimile a request (a &#147;<B><I>Bid
Rate Quote Reques</I></B>t&#148;) substantially in the form of <B>EXHIBIT G-1 </B>so as to be
received not later than 12:00 Noon (New York time) on (x)&nbsp;the fifth Banking Day
prior to the date for funding of the LIBOR Bid Rate Loan(s) proposed therein in
the case of a LIBOR Auction or (y)&nbsp;the second Banking Day prior to the date for
funding of the Absolute Bid Rate Loan(s) proposed therein in the case of an
Absolute Rate Auction, specifying:



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) the proposed date of funding of the Bid Rate Loan(s), which
shall be a Banking Day;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) the aggregate amount of the Bid Rate Loans requested, which
shall be $10,000,000 or a larger integral multiple of $500,000;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) the duration of the Interest Period(s) applicable thereto,
subject to the provisions of the definition of &#147;Interest Period&#148; in
Section&nbsp;1.01 and the provisions of Section&nbsp;2.05; and


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<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) whether the Bid Rate Quotes requested are to set forth a LIBOR
Bid Margin (to be used to compute the LIBOR Bid Rate) or an Absolute Bid
Rate.

<P align="left" style="font-size: 10pt">Borrower may request offers to make Bid Rate Loans for more than one (1)
Interest Period in a single Bid Rate Quote Request. No more than two (2)&nbsp;Bid
Rate Quote Requests may be submitted by Borrower during any calendar month and
no more than twenty-four (24)&nbsp;Bid Rate Quote Requests per year may be submitted
by Borrower.



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;Promptly (the same day, if possible) upon receipt of a Bid Rate Quote
Request, Administrative Agent shall send to the Banks by facsimile an
invitation (an &#147;<B><I>Invitation for Bid Rate Quotes</I></B>&#148;) substantially in the form of
<B>EXHIBIT G-2</B>, which shall constitute an invitation by Borrower to the Banks to
submit Bid Rate Quotes offering to make Bid Rate Loans to which such Bid Rate
Quote Request relates in accordance with this Section.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;(1)&nbsp;Each Bank may submit a Bid Rate Quote containing an offer or
offers to make Bid Rate Loans in response to any Invitation for Bid Rate
Quotes. Each Bid Rate Quote must comply with the requirements of this
paragraph (c)&nbsp;and must be submitted to Administrative Agent by facsimile not
later than (x)&nbsp;2:00 p.m. (New York time) on the fourth Banking Day prior to the
proposed date of the LIBOR Bid Rate Loan(s) in the case of a LIBOR Auction or
(y)&nbsp;9:30 a.m. (New York time) on the Banking Day immediately preceding the
proposed date of the Absolute Bid Rate Loan(s) in the case of an Absolute Rate
Auction; provided that Bid Rate Quotes submitted by Administrative Agent (or
any Affiliate of Administrative Agent) in its capacity as a Bank may be
submitted, and may only be submitted, if Administrative Agent or such Affiliate
notifies Borrower of the terms of the offer or offers contained therein not
later than (x)&nbsp;one (1)&nbsp;hour prior to the deadline for the other Banks in the
case of a LIBOR Auction or (y)&nbsp;thirty (30)&nbsp;minutes prior to the deadline for
the other Banks in the case of an Absolute Rate Auction. Any Bid Rate Quote so
made shall (subject to Borrower&#146;s satisfaction of the conditions precedent set
forth in this Agreement to its entitlement to an advance) be irrevocable except
with the written consent of Administrative Agent given on the instructions of
Borrower. Bid Rate Loans to be funded pursuant to a Bid Rate Quote may, as
provided in Section&nbsp;12.16, be funded by a Bank&#146;s Designated Lender. A Bank
making a Bid Rate Quote shall, if then known, specify in its Bid Rate Quote
whether the related Bid Rate Loans are intended to be funded by such Bank&#146;s
Designated Lender, as provided in Section&nbsp;12.16, provided, however, that
whether or not the same is specified in a Bank&#146;s Bid Rate Quote, such Bank&#146;s
Bid Rate Loan(s) may be funded by its Designated Lender at the time of funding
thereof.



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Each Bid Rate Quote shall be in substantially the form of
<B>EXHIBIT G-3 </B>and shall in any case specify:



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the proposed date of funding of the Bid Rate Loan(s);



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the principal amount of the Bid Rate Loan(s) for which each
such offer is being made, which principal amount (w)&nbsp;may be greater than
or less than the Loan Commitment of the quoting Bank, (x)&nbsp;must be in the
aggregate $10,000,000 or a larger integral multiple of $500,000, (y)&nbsp;may
not exceed the principal amount of Bid Rate Loans for which offers were
requested and (z)&nbsp;may be subject to an aggregate limitation as to the


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<P align="left" style="margin-left:2%; font-size: 10pt">principal amount of Bid Rate Loans for which offers being made by
such quoting Bank may be accepted;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) in the case of a LIBOR Auction, the margin above or below the
applicable LIBOR Interest Rate (the &#147;<B><I>LIBOR Bid Margin</I></B>&#148;) offered for each
such LIBOR Bid Rate Loan, expressed as a percentage per annum (specified
to the nearest 1/1,000th of 1%) to be added to (or subtracted from) the
applicable LIBOR Interest Rate;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) in the case of an Absolute Rate Auction, the rate of interest,
expressed as a percentage per annum (specified to the nearest 1/1,000th
of 1%) (the &#147;<B><I>Absolute Bid Rate</I></B>&#148;), offered for each such Absolute Bid Rate
Loan;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) the applicable Interest Period; and



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) the identity of the quoting Bank.

<P align="left" style="font-size: 10pt">A Bid Rate Quote may set forth up to three (3)&nbsp;separate offers by the quoting
Bank with respect to each Interest Period specified in the related Invitation
for Bid Rate Quotes.




<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Any Bid Rate Quote shall be disregarded if it:



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) is not substantially in conformity with <B>EXHIBIT G-3 </B>or does not
specify all of the information required by sub-paragraph (c)(2) above;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) contains qualifying, conditional or similar language (except
for an aggregate limitation as provided in sub-paragraph (c)(2)(ii)
above);



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) proposes terms other than or in addition to those set forth in
the applicable Invitation for Bid Rate Quotes; or



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) arrives after the time set forth in sub-paragraph (c)(1) above.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;Administrative Agent shall (x)&nbsp;not later than 3:00 p.m. (New York
time) on the fourth Banking Day prior to the proposed date of funding of the
LIBOR Bid Rate Loan(s) in the case of a LIBOR Auction or (y)&nbsp;not later than
10:30&nbsp;a.m. (New York time) on the Banking Day immediately preceding the
proposed date of funding of the Absolute Bid Rate Loan(s) in the case of an
Absolute Rate Auction, notify Borrower in writing of the terms of any Bid Rate
Quote submitted by a Bank that is in accordance with paragraph (c). In
addition, Administrative Agent shall, on the Banking Day of its receipt
thereof, notify Borrower in writing of any Bid Rate Quote that amends, modifies
or is otherwise inconsistent with a previous Bid Rate Quote submitted by such
Bank with respect to the same Bid Rate Quote Request. Any such subsequent Bid
Rate Quote shall be disregarded by Administrative Agent unless such subsequent
Bid Rate Quote is submitted solely to correct a manifest error in such former
Bid Rate Quote. Administrative Agent&#146;s notice to Borrower shall specify (A)&nbsp;the
aggregate principal amount of Bid Rate Loans for which offers have been
received for each Interest Period specified in the related Bid Rate Quote
Request, (B)&nbsp;the respective principal amounts, LIBOR Bid Margins and Absolute
Bid Rates so offered and (C)&nbsp;if applicable, limitations on the aggregate
principal amount of Bid Rate Loans for which offers in any single Bid Rate
Quote may be accepted.


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<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;Not later than 9:30 a.m. (New York time) on (x)&nbsp;the third Banking Day
prior to the proposed date of funding of the LIBOR Bid Rate Loan in the case of
a LIBOR Auction or (y)&nbsp;the Banking Day immediately preceding the proposed date
of funding of the Absolute Bid Rate Loan in the case of an Absolute Rate
Auction, Borrower shall notify Administrative Agent of its acceptance or
non-acceptance of the offers so notified to it pursuant to paragraph (d). If
Borrower fails to notify Administrative Agent of its acceptance of such offers,
it shall be deemed to have rejected such offers. A notice of acceptance shall
be substantially in the form of <B>EXHIBIT G</B>-4 and shall specify the aggregate
principal amount of offers for each Interest Period that are accepted.
Borrower may accept any Bid Rate Quote in whole or in part; provided that:



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the principal amount of each Bid Rate Loan may not exceed the
applicable amount set forth in the related Bid Rate Quote Request or be
less than $500,000 per Bank and shall be an integral multiple of
$100,000;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) acceptance of offers with respect to a particular Interest
Period may only be made on the basis of ascending LIBOR Bid Margins or
Absolute Bid Rates, as the case may be, offered for such Interest Period
from the lowest effective cost; and



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Borrower may not accept any offer that is described in
sub-paragraph (c)(3) or that otherwise fails to comply with the
requirements of this Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;If offers are made by two (2)&nbsp;or more Banks with the same LIBOR Bid
Margins or Absolute Bid Rates, as the case may be, for a greater aggregate
principal amount than the amount in respect of which such offers are accepted
for the related Interest Period, the principal amount of Bid Rate Loans in
respect of which such offers are accepted shall be allocated by Administrative
Agent among such Banks as nearly as possible (in multiples of $100,000, as
Administrative Agent may deem appropriate) in proportion to the aggregate
principal amounts of such offers. Administrative Agent shall promptly (and in
any event within one (1)&nbsp;Banking Day after such offers are accepted) notify
Borrower and each such Bank in writing of any such allocation of Bid Rate
Loans. Determinations by Administrative Agent of the allocation of Bid Rate
Loans shall be conclusive in the absence of manifest error.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;In the event that Borrower accepts the offer(s) contained in one (1)
or more Bid Rate Quotes in accordance with paragraph (e), the Bank(s) making
such offer(s) shall make a Bid Rate Loan in the accepted amount (as allocated,
if necessary, pursuant to paragraph (f)) on the date specified therefor, in
accordance with the procedures specified in Section&nbsp;2.04, and such Bid Rate
Loan shall bear interest at the accepted LIBOR Bid Rate or Absolute Bid Rate,
as the case may be, for the applicable Interest Period.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;Notwithstanding anything to the contrary contained herein, each Bank
shall be required to fund its Pro Rata Share of the Available Total Loan
Commitment in accordance with Section&nbsp;2.01(b) despite the fact that any Bank&#146;s
Loan Commitment may have been or may be exceeded as a result of such Bank&#146;s
making Bid Rate Loans.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;A Bank who is notified that it has been selected to make a Bid Rate
Loan as provided above may designate its Designated Lender (if any) to fund
such Bid Rate Loan on its behalf, as described in Section&nbsp;12.16. Any
Designated Lender which funds a Bid Rate Loan shall


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<P align="left" style="font-size: 10pt">on and after the time of such funding become the obligee under such Bid
Rate Loan and be entitled to receive payment thereof when due. No Bank shall
be relieved of its obligation to fund a Bid Rate Loan, and no Designated Lender
shall assume such obligation, prior to the time the applicable Bid Rate Loan is
funded.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)&nbsp;Administrative Agent shall promptly notify each Bank which submitted a
Bid Rate Quote of Borrower&#146;s acceptance or non-acceptance thereof. At the
request of any Bank which submitted a Bid Rate Quote, Administrative Agent will
promptly notify all Banks which submitted Bid Rate Quotes of (a)&nbsp;the aggregate
principal amount of, and (b)&nbsp;the range of Absolute Bid Rates or LIBOR Bid
Margins of, the accepted Bid Rate Loans for each requested Interest Period.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.03 </B><u><B>Advances, Generally</B></u>. The Initial Advance shall be in
the minimum amount of $500,000 and in integral multiples of $100,000 above such
amount and shall be made upon satisfaction of the conditions set forth in
Section&nbsp;4.01. Subsequent advances shall be made no more frequently than twice
weekly thereafter, upon satisfaction of the conditions set forth in Section
4.02. The amount of each advance subsequent to the Initial Advance shall be in
the minimum amount of $500,000 (unless less than $500,000 is available for
disbursement pursuant to the terms hereof at the time of any subsequent
advance, in which case the amount of such subsequent advance shall be equal to
such remaining availability) and in integral multiples of $100,000 above such
amount. Additional restrictions on the amounts and timing of, and conditions
to the making of, advances of Bid Rate Loans are set forth in Section&nbsp;2.02.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.04 </B><u><B>Procedures for Advances</B></u>. In the case of advances of
Ratable Loans hereunder, Borrower shall submit to Administrative Agent a
request for each advance, stating the amount requested and certifying the
purpose, in general terms, for which such advance is to be used, no later than
11:00&nbsp;a.m. (New York time) on the date, in the case of advances of Base Rate
Loans, which is one (1)&nbsp;Banking Day, and, in the case of advances of LIBOR
Loans, which is three (3)&nbsp;Banking Days, prior to the date the advance is to be
made. In the case of advances of Swing Loans hereunder, Borrower shall submit
to Administrative Agent a request for such advance, stating the amount
requested and certifying the purpose, in general terms, for which such advance
is to be used, no later than 11:00&nbsp;a.m. (New York time) on the date which is
one (1)&nbsp;Banking Day prior to the date the advance is to be made. In the case
of advances of Bid Rate Loans hereunder, Borrower shall submit a Bid Rate Quote
Request at the time specified in Section&nbsp;2.02, accompanied by a certification
of the purpose, in general terms, for which the advance is to be used.
Administrative Agent, on the Banking Day of its receipt and approval of the
request for advance, will so notify the Banks (or, in the case of Swing Loans,
the Swing Lender) either by telephone or by facsimile. Not later than 11:00
a.m. (New York time) on the date of each advance, each Bank (in the case of
Ratable Loans) or the applicable Bank(s) (in the case of Bid Rate Loans) or the
Swing Lender (in the case of Swing Loans) shall, through its Applicable Lending
Office and subject to the conditions of this Agreement, make the amount to be
advanced by it on such day available to Administrative Agent, at Administrative
Agent&#146;s Office and in immediately available funds for the account of Borrower.
The amount so received by Administrative Agent shall, subject to the conditions
of this Agreement, be made available to Borrower, in immediately available
funds, by Administrative Agent&#146;s crediting an account of Borrower designated by
Borrower and maintained with Administrative Agent at Administrative Agent&#146;s
Office.


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<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.05 </B><u><B>Interest Periods; Renewals</B></u>. In the case of the LIBOR
Loans and Bid Rate Loans, Borrower shall select an Interest Period of any
duration in accordance with the definition of Interest Period in Section&nbsp;1.01,
subject to the following limitations: (1)&nbsp;no Interest Period may extend beyond
the Maturity Date; and (2)&nbsp;if an Interest Period would end on a day which is
not a Banking Day, such Interest Period shall be extended to the next Banking
Day, unless such Banking Day would fall in the next calendar month, in which
event such Interest Period shall end on the immediately preceding Banking Day.
Only twelve (12)&nbsp;discrete segments of a Bank&#146;s Ratable Loan bearing interest at
a LIBOR Interest Rate, for a designated Interest Period, pursuant to a
particular Election, Conversion or Continuation, may be outstanding at any one
time (each such segment of each Bank&#146;s Ratable Loan corresponding to a
proportionate segment of each of the other Banks&#146; Ratable Loans). Upon notice
to Administrative Agent as provided in Section&nbsp;2.14, Borrower may Continue any
LIBOR Loan on the last day of the Interest Period of the same or different
duration in accordance with the limitations provided above. If Borrower shall
fail to give notice to Administrative Agent of such a Continuation, such LIBOR
Loan shall automatically become a LIBOR Loan with an Interest Period of one (1)
month on the last day of the current Interest Period. Administrative Agent
shall notify each of the Banks, either by telephone or by facsimile, at least
two (2)&nbsp;Banking Days prior to the termination of the Interest Period in
question in the event of such failure by Borrower to give such notice of
Continuation.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.06 </B><u><B>Interest</B></u>. Borrower shall pay interest to
Administrative Agent for the account of the applicable Bank on the outstanding
and unpaid principal amount of the Loans, at a rate per annum as follows: (1)
for Base Rate Loans at a rate equal to the Base Rate plus the Applicable
Margin; (2)&nbsp;for LIBOR Loans at a rate equal to the applicable LIBOR Interest
Rate plus the Applicable Margin; (3)&nbsp;for LIBOR Bid Rate Loans at a rate equal
to the applicable LIBOR Bid Rate; (4)&nbsp;for Absolute Bid Rate Loans at a rate
equal to the applicable Absolute Bid Rate; and (5)&nbsp;for Swing Loans at a three
(3)-day LIBOR rate, as determined by the Swing Lender. Any principal amount
not paid when due (when scheduled, at acceleration or otherwise) shall bear
interest thereafter, payable on demand, at the Default Rate.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The interest rate on Base Rate Loans shall change when the Base Rate
changes. Interest on Base Rate Loans, LIBOR Loans, Bid Rate Loans and Swing
Loans shall not exceed the maximum amount permitted under applicable Law.
Interest shall be calculated for the actual number of days elapsed on the basis
of, in the case of Base Rate Loans, LIBOR Loans, Bid Rate Loans and Swing
Loans, three hundred sixty (360)&nbsp;days.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest shall be due and payable in arrears upon and with respect
to any payment or prepayment of principal and, (x)&nbsp;in the case of Base Rate
Loans, LIBOR Loans and Swing Loans, on the first Banking Day of each calendar
month and (y)&nbsp;in the case of Bid Rate Loans, at the expiration of the Interest
Period applicable thereto; provided, however, that interest accruing at the
Default Rate shall be due and payable on demand.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.07 </B><u><B>Fees</B></u>.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Borrower agrees to pay to and for the accounts of the parties
specified therein, the fees provided for in the Supplemental Fee Letter.


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<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;Borrower shall pay to Administrative Agent for the account of each
Bank a facility fee computed on the daily Loan Commitment of such Bank
(irrespective of usage) at a rate per annum equal to the daily Facility Fee
Rate, calculated on the basis of a year of three hundred sixty (360)&nbsp;days for
the actual number of days elapsed. The accrued facility fee shall be due and
payable quarterly in arrears on the tenth (10th) day of October, January,
April and July of each year, commencing on the first such date after the
Closing Date, and upon the Maturity Date (as stated or by acceleration or
otherwise) or earlier termination of the Loan Commitments.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.08 </B><u><B>Notes</B></u>. The Ratable Loan made by each Bank under this
Agreement shall be evidenced by, and repaid with interest in accordance with, a
single promissory note of Borrower in the form of <B>EXHIBIT B </B>duly completed and
executed by Borrower, in the principal amount equal to such Bank&#146;s Loan
Commitment, payable to such Bank for the account of its Applicable Lending
Office (each such note, as the same may hereafter be amended, modified,
extended, severed, assigned, renewed or restated from time to time, including
any new or substitute notes pursuant to Section&nbsp;2.19, 3.07 or 12.05, a &#147;<B><I>Ratable
Loan Note</I></B>&#148;). The Bid Rate Loans of the Banks shall be evidenced by a single
global promissory note of Borrower, in the form of <B>EXHIBIT B-1</B>, duly completed
and executed by Borrower, in the principal amount of $250,000,000, payable to
Administrative Agent for the account of the respective Banks making Bid Rate
Loans (such note, as the same may hereafter be amended, modified, extended,
severed, assigned, substituted, renewed or restated from time to time, the &#147;<B><I>Bid
Rate Loan Note</I></B>&#148;). The Swing Loan of the Swing Lender shall be evidenced by,
and repaid with interest in accordance with, a promissory note of Borrower, in
the form of <B>EXHIBIT B-2</B>, duly completed and executed by Borrower, payable to
the Swing Lender (such note, as the same may hereafter be amended, modified
extended, severed, assigned, substituted, renewed or restated from time to
time, the &#147;<B><I>Swing Loan Note</I></B>&#148;). A particular Bank&#146;s Ratable Loan Note, together
with its interest, if any, in the Bid Rate Loan Note, and, in the case of the
Swing Lender, the Swing Loan Note, are referred to collectively in this
Agreement as such Bank&#146;s &#147;<B><I>Note</I></B>&#148;; all such Ratable Loan Notes, the Bid Rate Loan
Note and the Swing Loan Note are referred to collectively in this Agreement as
the &#147;<B><I>Notes</I></B>&#148;. The Ratable Loan Notes shall mature, and all outstanding
principal and accrued interest and other sums thereunder shall be paid in full,
on the Maturity Date, as the same may be accelerated. The outstanding
principal amount of each Bid Rate Loan evidenced by the Bid Rate Loan Note, and
all accrued interest and other sums with respect thereto, shall become due and
payable to the Bank making such Bid Rate Loan at the earlier of the expiration
of the Interest Period applicable thereto or the Maturity Date, as the same may
be accelerated. Principal amounts evidenced by the Swing Loan Notes shall
become due and payable at the earlier of three (3)&nbsp;Banking Days after said
amounts are advanced or the Maturity Date.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each Bank is hereby authorized by Borrower to endorse on the schedule
attached to the Ratable Loan Note held by it, the amount of each advance and
each payment of principal received by such Bank for the account of its
Applicable Lending Office(s) on account of its Ratable Loan, which endorsement
shall, in the absence of manifest error, be conclusive as to the outstanding
balance of the Ratable Loan made by such Bank. The Swing Lender is hereby
authorized by Borrower to endorse on the schedule attached to the Swing Loan
Note held by it, the amount of each advance and each payment of principal
received by the Swing Lender for the account of its Applicable Lending
Office(s) on account of its Swing Loan, which endorsement shall, in the absence
of manifest error, be conclusive as to the outstanding balance of the Swing
Loan made by the Swing Lender. Administrative Agent is hereby authorized by
Borrower to endorse on the schedule attached to the Bid Rate Loan Note the
amount of each LIBOR Bid Rate Loan and/or


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<P align="left" style="font-size: 10pt">Absolute Bid Rate Loan, the name of the Bank making the same, the date of the
advance thereof, the interest rate applicable thereto and the expiration of the
Interest Period applicable thereto (i.e., the maturity date thereof). The
failure by Administrative Agent or any Bank to make such notations with respect
to the Loans or each advance or payment shall not limit or otherwise affect the
obligations of Borrower under this Agreement or the Notes. In case of any
loss, theft, destruction or mutilation of any Bank&#146;s Note, Borrower shall, upon
its receipt of an affidavit of an officer of such Bank as to such loss, theft,
destruction or mutilation and an appropriate indemnification, execute and
deliver a replacement Note to such Bank in the same principal amount and
otherwise of like tenor as the lost, stolen, destroyed or mutilated Note.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.09 </B><u><B>Prepayments</B></u>. Without prepayment premium or penalty
but subject to Section&nbsp;3.05, Borrower may, upon at least one (1)&nbsp;Banking Day&#146;s
notice to Administrative Agent in the case of the Base Rate Loans and Swing
Loans, and at least three (3)&nbsp;Banking Days&#146; notice to Administrative Agent (who
shall provide such notice, promptly upon receipt, to each of the Banks) in the
case of LIBOR Loans, prepay the Ratable Loans, provided that (1)&nbsp;any partial
prepayment under this Section shall be in integral multiples of $500,000; (2)&nbsp;a
LIBOR Loan or Swing Loan may be prepaid at any time, subject, however, to the
provisions of Section&nbsp;3.05; and (3)&nbsp;each prepayment under this Section shall
include all interest accrued on the amount of principal prepaid through the
date of prepayment. Prepayment of Bid Rate Loans shall not be permitted.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.10 </B><u><B>Cancellation of Commitments</B></u>.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;At any time, Borrower shall have the right, without premium or
penalty, to terminate any unused Loan Commitments (i.e., to terminate Loan
Commitments to the extent of the Available Total Loan Commitment) or unused
commitment of the Swing Lender to make Swing Loans, in whole or in part, from
time to time, provided that: (1)&nbsp;Borrower shall give notice of each such
termination to Administrative Agent (who shall provide such notice, promptly
upon receipt, to each of the Banks) and the Swing Lender, if applicable, no
later then 10:00&nbsp;a.m. (New York time) on the date which is fifteen (15)&nbsp;Banking
Days prior to the effectiveness of such termination; (2)&nbsp;the Loan Commitments
of each of the Banks, or Swing Lender, as applicable, must be terminated
ratably and simultaneously with those of the other Banks, or Swing Lender, as
applicable; (3)&nbsp;each partial termination of the Loan Commitments, or
commitments to make Swing Loans, as a whole (and corresponding reduction of the
Total Loan Commitment) shall be in an integral multiple of $1,000,000 and (4)
no partial cancellation of the Loan Commitments shall reduce the Total Loan
Commitment to an amount below $200,000,000.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;The Loan Commitments, to the extent terminated, may not be reinstated.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.11 </B><u><B>Method of Payment</B></u>. Borrower shall make each payment
under this Agreement and under the Notes not later than 11:00&nbsp;a.m. (New York
time) on the date when due in Dollars to Administrative Agent at Administrative
Agent&#146;s Office in immediately available funds. Administrative Agent will
thereafter, on the day of its receipt of each such payment, cause to be
distributed to each Bank (1)&nbsp;such Bank&#146;s appropriate share determined pursuant
to Section&nbsp;10.15 of the payments of principal and interest in like funds for
the account of such Bank&#146;s Applicable Lending Office; and (2)&nbsp;fees payable to
such Bank in accordance with the terms of this Agreement. In the event
Administrative Agent fails to pay funds received from Borrower to the Banks on
the date on which Borrower is credited with payment, Administrative Agent shall
pay interest on such


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<P align="left" style="font-size: 10pt">amounts at the Federal Funds Rate until such payment to the Banks is made.
Borrower hereby authorizes Administrative Agent and the Banks, if and to the
extent payment by Borrower is not made when due under this Agreement or under
the Notes, to charge from time to time against any account Borrower maintains
with Administrative Agent or any Bank any amount so due to Administrative Agent
and/or the Banks. Except to the extent provided in this Agreement, whenever
any payment to be made under this Agreement or under the Notes is due on any
day other than a Banking Day, such payment shall be made on the next succeeding
Banking Day, and such extension of time shall in such case be included in the
computation of the payment of interest and other fees, as the case may be.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.12 </B><u><B>Elections, Conversions or Continuation of Loans</B></u>.
Subject to the provisions of Article&nbsp;III and Sections&nbsp;2.05 and 2.13, Borrower
shall have the right to Elect to have all or a portion of any advance of the
Ratable Loans be LIBOR Loans, to Convert Base Rate Loans into LIBOR Loans, to
Convert LIBOR Loans into Base Rate Loans, or to Continue LIBOR Loans as LIBOR
Loans, at any time or from time to time, provided that (1)&nbsp;Borrower shall give
Administrative Agent notice of each such Election, Conversion or Continuation
as provided in Section&nbsp;2.14; and (2)&nbsp;a LIBOR Loan may be Converted or Continued
only on the last day of the applicable Interest Period for such LIBOR Loan.
Except as otherwise provided in this Agreement, each Election, Continuation and
Conversion shall be applicable to each Bank&#146;s Ratable Loan in accordance with
its Pro Rata Share.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.13 </B><u><B>Minimum Amounts</B></u>. With respect to the Ratable Loans as
a whole, each Election and each Conversion shall be in an amount at least equal
to $1,000,000 and in integral multiples of $500,000.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.14 </B><u><B>Certain Notices Regarding Elections, Conversions and
Continuations of Loans</B></u>. Notices by Borrower to Administrative Agent of
Elections, Conversions and Continuations of LIBOR Loans shall be irrevocable
and shall be effective only if received by Administrative Agent not later than
10:30&nbsp;a.m. (New York time) on the number of Banking Days prior to the date of
the relevant Election, Conversion or Continuation specified below:

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="55%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="78%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>

    <TD nowrap align="right" colspan="3" style="border-bottom: 1px solid gray">Number of Banking Days Prior Notice</TD>
</TR>

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<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Conversions into Base Rate Loans</DIV></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center">two (2)</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Elections of, Conversions into or<br>
Continuations as, LIBOR Loans</DIV></TD>
    <TD>&nbsp;</TD>
    <TD colspan="3" align="center">three (3)</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>


<P align="left" style="font-size: 10pt">Promptly following its receipt of any such notice, and no later than the close
of business on the Banking Day of such receipt, Administrative Agent shall so
advise the Banks either by telephone or by facsimile. Each such notice of
Election shall specify the portion of the amount of the advance that is to be
LIBOR Loans (subject to Section&nbsp;2.13) and the duration of the Interest Period
applicable thereto (subject to Section&nbsp;2.05); each such notice of Conversion
shall specify the LIBOR Loans or Base Rate Loans to be Converted; and each such
notice of Conversion or Continuation shall specify the date of Conversion or
Continuation (which shall be a Banking Day), the amount thereof (subject to
Section&nbsp;2.13) and the duration of the Interest Period applicable thereto
(subject to Section&nbsp;2.05). In the event that Borrower fails to Elect to have
any portion of an



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<P align="left" style="font-size: 10pt">advance of the Ratable Loans be LIBOR Loans, the entire amount of such advance
shall constitute Base Rate Loans. In the event that Borrower fails to Continue
LIBOR Loans within the time period and as otherwise provided in this Section,
such LIBOR Loans will automatically become LIBOR Loans with an Interest Period
of one (1)&nbsp;month on the last day of the then current applicable Interest Period
for such LIBOR Loans. Administrative Agent shall notify each of the Banks,
either by telephone or by facsimile, at least two (2)&nbsp;Banking Days prior to the
termination of the Interest Period in question in the event of such failure by
Borrower.



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.15 </B><u><B>Late Payment Premium</B></u>. Borrower shall, at
Administrative Agent&#146;s option and upon notice to Borrower, pay to
Administrative Agent for the account of the Banks a late payment premium in the
amount of 4% of any payments of interest under the Loans made more than ten
(10)&nbsp;days after the due date thereof, which shall be due with any such late
payment.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.16 </B><u><B>Letters of Credit</B></u>.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Borrower, by notice to Administrative Agent and the Issuing Bank, may
request, in lieu of advances of proceeds of the Ratable Loans, that the Issuing
Bank issue unconditional, irrevocable standby letters of credit or direct-pay
letters of credit (each, a &#147;<B><I>Letter of Credit</I></B>&#148;) for the account of Borrower,
payable by sight drafts, for such beneficiaries and with such other terms as
Borrower shall specify. Promptly upon receipt of notice from the Issuing Bank
of the issuance, amendment or extension of a Letter of Credit, Administrative
Agent shall notify each of the Banks.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;The amount of any Letter of Credit shall be limited to the lesser of
(x) $70,000,000 less the aggregate amount of all Letters of Credit theretofore
issued and outstanding or (y)&nbsp;the Available Total Loan Commitment, it being
understood that the amount of each Letter of Credit issued and outstanding
shall effect a reduction, by an equal amount, of the Available Total Loan
Commitment (such reduction to be allocated to each Bank&#146;s Loan Commitment
ratably in accordance with the Banks&#146; respective Pro Rata Shares).


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;The amount of each Letter of Credit shall be further subject to the
limitations applicable to amounts of advances set forth in Section&nbsp;2.03 and the
procedures for the issuance of each Letter of Credit shall be the same as the
procedures applicable to the making of advances as set forth in the first
sentence of Section&nbsp;2.04. The Issuing Bank&#146;s issuance of each Letter of Credit
shall be subject to notice from the Administrative Agent that it has determined
that Borrower has satisfied all conditions precedent to its entitlement to an
advance of proceeds of the Loans.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;Each Letter of Credit shall expire no later than one (1)&nbsp;month prior
to the Maturity Date, but may have a so-called &#147;evergreen&#148; clause allowing for
the extension of the expiration date thereof upon the extension of the Maturity
Date pursuant to Section&nbsp;2.18.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;In connection with, and as a further condition to the issuance of,
each Letter of Credit, Borrower shall execute and deliver to Administrative
Agent and the Issuing Bank an application for the Letter of Credit on the
Issuing Bank&#146;s standard form therefor, together with such other documents,
opinions and assurances as Administrative Agent and the Issuing Bank shall
reasonably require.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;In connection with each Letter of Credit, Borrower hereby covenants to
pay to Administrative Agent the following fees: (1)&nbsp;a fee, payable quarterly
in arrears (on the first


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<P align="left" style="font-size: 10pt">Banking Day of each calendar quarter following the issuance of the Letter
of Credit), for the account of the Banks, computed daily on the amount of the
Letter of Credit issued and outstanding at a rate per annum equal to the
&#147;Banks&#146; L/C Fee Rate&#148; (as hereinafter defined) and (2)&nbsp;the fee, for the Issuing
Bank&#146;s account, required by the Supplemental Fee Letter between Borrower and
Fleet. In addition to the fees described in the preceding sentence, the
Borrower shall pay to the Issuing Bank such other customary letter of credit
charges when incurred. For purposes of this Agreement, the &#147;Banks&#146; L/C Fee
Rate&#148; shall mean, at any time, a rate per annum equal to the Applicable Margin
for LIBOR Loans less 0.125% per annum. It is understood and agreed that the
last installment of the fees provided for in this paragraph (f)&nbsp;with respect to
any particular Letter of Credit shall be due and payable on the first day of
the calendar quarter following the return, undrawn, or cancellation of such
Letter of Credit to the Issuing Bank, who shall promptly provide notice to
Administrative Agent of such return or cancellation, and Borrower&#146;s receipt of
notice from Administrative Agent.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;Upon any drawing under a Letter of Credit, the Issuing Bank shall
immediately provide notice to the Borrower and Administrative Agent of such
drawing. The Borrower shall reimburse the Issuing Bank on the date of any
drawing under a Letter of Credit. Such reimbursement shall be made with the
proceeds of an advance of Loans as set forth below unless such advance cannot
for any reason be made. The parties hereto acknowledge and agree that,
immediately upon notice from Administrative Agent of any drawing under a Letter
of Credit, each Bank shall, notwithstanding the existence of a Default or Event
of Default or the non-satisfaction of any conditions precedent to the making of
an advance of the Loans, advance proceeds of its Ratable Loan, in an amount
equal to its Pro Rata Share of such drawing, which advance shall be made to
Administrative Agent for the account of the Issuing Bank to reimburse the
Issuing Bank for such drawing. Each of the Banks further acknowledges that its
obligation to fund its Pro Rata Share of drawings under Letters of Credit as
aforesaid shall survive the Banks&#146; termination of this Agreement or enforcement
of remedies hereunder or under the other Loan Documents. In the event that any
Ratable Loan cannot for any reason be made on the date otherwise required above
(including, without limitation, as a result of the commencement of a proceeding
under any applicable bankruptcy or insolvency Law with respect to Borrower),
then each Bank shall purchase (on or as of the date such Ratable Loan would
otherwise have been made) from the Issuing Bank a participation interest in any
unreimbursed drawing in an amount equal to its Pro Rata Share of such
unreimbursed drawing.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;Borrower agrees, upon the occurrence of an Event of Default and at the
written request of Administrative Agent, (1)&nbsp;to deposit with Administrative
Agent for the benefit of the Issuing Bank and the Banks cash collateral in the
amount of all the outstanding Letters of Credit, which cash collateral shall be
held by Administrative Agent for the benefit of the Issuing Bank and the Banks
as security for Borrower&#146;s obligations in connection with the Letters of Credit
and (2)&nbsp;to execute and deliver to Administrative Agent and the Issuing Bank
such documents as Administrative Agent or the Issuing Bank reasonably requests
to confirm and perfect the assignment of such cash collateral to Administrative
Agent for the benefit of the Issuing Bank and the Banks.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.17 </B><u><B>Swing Loans</B></u>.


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<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;During the term of this Agreement, the Swing Lender agrees, on the
terms and conditions set forth in this Agreement, to make advances to Borrower
pursuant to this Section from time to time in amounts such that (i)&nbsp;the
aggregate of such advance and amount of Swing Loans theretofore advanced and
still outstanding does not at any time exceed the Swing Loan Commitment and
(ii)&nbsp;the amount of such advance does not exceed the Available Total Loan
Commitment. Each advance under this Section shall be in an aggregate principal
amount of $1,000,000 or a larger multiple of $100,000 (except that any such
advance may be in the aggregate available amount of Swing Loans determined in
accordance with the immediately preceding sentence). With the foregoing
limits, Borrower may borrow under this Section, repay or, to the extent
permitted by Section&nbsp;2.09, prepay Swing Loans and reborrow under this Section
at any time during the term of this Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;The Swing Lender shall, on behalf of Borrower (which hereby
irrevocably directs the Swing Lender to act on its behalf), on notice given by
the Swing Lender no later than 1:00 p.m. (New York time) on the Banking Day
immediately following the funding of any Swing Loan, request each Bank to make,
and each Bank hereby agrees to make, an advance of its Ratable Loan, in an
amount (with respect to each Bank, its &#147;<B><I>Swing Loan Refund Amount</I></B>&#148;) equal to
such Bank&#146;s Pro Rata Share of the aggregate principal amount of the Swing Loans
(the &#147;<B><I>Refunded Swing Loans</I></B>&#148;) outstanding on the date of such notice, to repay
the Swing Lender. Unless any of the events described in paragraph (5)&nbsp;of
Section&nbsp;9.01 with respect to Borrower shall have occurred and be continuing (in
which case the procedures of paragraph (c)&nbsp;of this Section shall apply), each
Bank shall make such advance of its Ratable Loan available to Administrative
Agent at Administrative Agent&#146;s Office in immediately available funds, not
later than 1:00 p.m. (New York time), on the third Banking Day immediately
following the date of such notice. Administrative Agent shall pay the proceeds
of such advance of Ratable Loans to the Swing Lender, which shall immediately
apply such proceeds to repay Refunded Swing Loans. Effective on the day such
advances of Ratable Loans are made, the portion of the Swing Loans so paid
shall no longer be outstanding as Swing Loans, shall no longer be due as Swing
Loans under the Swing Loan Note held by the Swing Lender, and shall be due as
Ratable Loans under the respective Ratable Loan Notes issued to the Banks
(including the Swing Lender). Borrower authorizes the Swing Lender to charge
Borrower&#146;s accounts with Administrative Agent (up to the amount available in
each such accounts) in order to immediately pay the amount of such Refunded
Swing Loans to the extent amounts received from the Banks are not sufficient to
repay in full such Refunded Swing Loans.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;If, prior to the time advances of Ratable Loans would have otherwise
been made pursuant to paragraph (b)&nbsp;of this Section, one of the events
described in paragraph (5)&nbsp;of Section&nbsp;9.01 with respect to the Borrower shall
have occurred and be continuing, each Bank shall, on the date such advances
were to have been made pursuant to the notice referred to in paragraph (b)&nbsp;of
this Section (the &#147;<B><I>Refunding Date</I></B>&#148;), purchase an undivided participating
interest in the Swing Loans in an amount equal to such Bank&#146;s Swing Loan Refund
Amount. On the Refunding Date, each Bank shall transfer to the Swing Lender,
in immediately available funds, such Bank&#146;s Swing Loan Refund Amount, and upon
receipt thereof, the Swing Lender shall deliver to such Bank a Swing Loan
participation certificate dated the date of the Swing Lender&#146;s receipt of such
funds and in the Swing Loan Refund Amount of such Bank.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;Whenever, at any time after the Swing Lender has received from any
Bank such Bank&#146;s Swing Loan Refund Amount pursuant to paragraph (c)&nbsp;of this
Section, the Swing Lender


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<P align="left" style="font-size: 10pt">receives any payment on account of the Swing Loans in which the Banks have
purchased Participations pursuant to said paragraph (c), the Swing Lender will
promptly distribute to each such Bank its ratable share (determined on the
basis of the Swing Loan Refund Amounts of all of the Banks) of such payment
(appropriately adjusted, in the case of interest payments, to reflect the
period of time during which such Bank&#146;s participating interest was outstanding
and funded); provided, however, that in the event that such payment received by
the Swing Lender is required to be returned, such Bank will return to the Swing
Lender any portion thereof previously distributed to it by the Swing Lender.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;Each Bank&#146;s obligation to make an advance of its Ratable Loan as
provided in paragraph (b)&nbsp;of this Section or to purchase a participating
interest pursuant to paragraph (c)&nbsp;of this Section shall be absolute and
unconditional and shall not be affected by any circumstance, including, without
limitation, (i)&nbsp;any set-off, counterclaim, recoupment, defense or other right
which such Bank, Borrower or any other Person may have against the Swing Lender
or any other Person, (ii)&nbsp;the occurrence or continuance of a Default or an
Event of Default, the termination or reduction of the Loan Commitments or the
non-satisfaction of any condition precedent to the making of any advance of the
Loans, (iii)&nbsp;any adverse change in the condition (financial or otherwise) of
Borrower or any other Person, (iv)&nbsp;any breach of this Agreement by Borrower,
any other Bank or any other Person or (v)&nbsp;any other circumstance, happening or
event whatsoever, whether or not similar to any of the foregoing.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;Notwithstanding anything above in this Section or elsewhere in this
Agreement to the contrary, in the event that the Swing Lender funds a Swing
Loan hereunder when it has actual knowledge that a monetary Default, or
material Event of Default (which, for the avoidance of doubt shall include any
violation of any provision of Article&nbsp;VII or Article&nbsp;VIII) has occurred and is
continuing, the Banks shall have the option, but not the obligation, to make
Ratable Loans to fund their ratable shares of such Swing Loan as contemplated
in paragraph (b)&nbsp;of this Section or to purchase participations as contemplated
in paragraph (c)&nbsp;of this Section.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;For purposes of Article&nbsp;III, Swing Loans shall be deemed to be LIBOR
Loans.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.18 </B><u><B>Extension Of Maturity</B></u>. Borrower shall have the option
(the &#147;<B><I>Extension Option</I></B>&#148;) to extend the original Maturity Date for a period of
one (1)&nbsp;year. Subject to the conditions set forth below, Borrower may exercise
the Extension Option by delivering a written notice to Administrative Agent
(who shall provide such notice, promptly upon receipt, to each of the Banks)
not more than ninety (90)&nbsp;days and not less than thirty (30)&nbsp;days prior to the
original Maturity Date (a &#147;<B><I>Notice to Extend</I></B>&#148;), stating that Borrower has
elected to extend the original Maturity Date for one (1)&nbsp;year. Borrower&#146;s
delivery of the Notice to Extend shall be irrevocable and Borrower&#146;s right to
exercise the Extension Option shall be subject to the following terms and
conditions: (i)&nbsp;there shall exist no Event of Default on both the date
Borrower delivers the Notice to Extend to Administrative Agent and on the
original Maturity Date, (ii)&nbsp;Borrower shall have paid to Administrative Agent
for the account of each Bank an extension fee equal to 0.15% of such Bank&#146;s
Loan Commitment simultaneously with delivery of the Notice to Extend and (iii)
Borrower shall be in compliance with the covenants contained in Articles VII
and VIII, as evidenced by a certificate from Borrower of the sort required by
paragraph (3)&nbsp;of Section&nbsp;6.09 (based on financial results for the most recent
calendar quarter for which Borrower is required to report financial results).


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<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;2.19 </B><u><B>Additional Loan Commitments</B></u>.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;Borrower may, from time to time, up to a maximum of three (3)
requests, request the Banks to increase their Loan Commitments, so as to
increase the Total Loan Commitment to an amount no greater than the sum of (1)
the Accordion Amount plus (2) $500,000,000 less (3)&nbsp;the amount of any reduction
of the Total Loan Commitment pursuant to Section&nbsp;2.10. The increase in the
Total Loan Commitment pursuant to any such particular request shall be at least
an amount (the &#147;<B><I>Minimum Request</I></B>&#148;) equal to the lesser of (x) $50,000,000 or (y)
the Accordion Amount less all previous increases in the Total Loan Commitment
pursuant to this Section. Borrower shall make each such request by giving
notice to Syndication Agent no later than forty-five (45)&nbsp;days prior to the
date (the &#147;<B><I>Syndication Expiration Date</I></B>&#148;) that is twenty-seven (27)&nbsp;months after
the Closing Date, which notice shall set forth the amount (which shall be no
less than the Minimum Request) of the requested increase in the Total Loan
Commitment (the &#147;<B><I>Requested Increase</I></B>&#148;) and such other details with respect to
such increase as Syndication Agent shall reasonably request. Syndication Agent
will use commercially reasonable efforts, with the assistance of Borrower, to
arrange a syndicate of Banks with Loan Commitments (including the then-existing
Loan Commitments) aggregating the then existing Total Loan Commitment plus the
Requested Increase. Upon receipt of notice as aforesaid from Borrower,
Syndication Agent shall promptly send a copy of such notice to each Bank and
shall request that each Bank increase its Loan Commitment by an amount equal to
its Pro Rata Share of the Requested Increase (the &#147;<B><I>First Solicitation</I></B>&#148;). Each
Bank shall have the right, but not the obligation, to increase its Loan
Commitment by an amount equal to its Pro Rata Share of the Requested Increase,
and shall have a period of fifteen (15)&nbsp;days from the First Solicitation to
notify Syndication Agent whether or not such Bank elects so to increase its
Loan Commitment. Any Bank that fails to respond to the First Solicitation
within such fifteen (15)-day period will be deemed to have elected not to
increase its Loan Commitment. If all Banks elect to increase their respective
Loan Commitments by amounts equal to their respective Pro Rata Shares of the
Requested Increase, Syndication Agent shall so notify Borrower, Administrative
Agent and each of the Banks, and Borrower shall proceed in accordance with
paragraph (b)&nbsp;below. If any Bank (any such Bank, a &#147;<B><I>Declining Bank</I></B>&#148;) shall not
elect or shall be deemed to have elected not to increase its Loan Commitment as
aforesaid, (i)&nbsp;the amount of such Declining Bank&#146;s Loan Commitment shall be
unchanged, (ii)&nbsp;Syndication Agent shall notify Borrower, Administrative Agent
and each of the Banks as to which Banks have elected to increase their Loan
Commitments and by what amounts and (iii)&nbsp;if Borrower so requests, Syndication
Agent shall either (A)&nbsp;solicit from the Banks that elected to increase their
respective Loan Commitments a further increase in their Loan Commitments in an
aggregate amount equal to all or any portion of the aggregate amount of the
Declining Banks&#146; Pro Rata Shares of the Requested Increase (the &#147;<B><I>Shortfall</I></B>&#148;) or
(B)&nbsp;submit a list of proposed syndicate members that are not then a party to
this Agreement to Borrower for its review and approval (such approval not to be
unreasonably withheld or delayed) in order to obtain additional commitments in
an amount equal to the Shortfall. From and after the Syndication Expiration
Date, Syndication Agent shall have no further obligation to syndicate the
Facility or to obtain or accept any additional Loan Commitments.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;In connection with increases to the Loan Commitments of some or all of
the Banks as provided in paragraph (a)&nbsp;above, Borrower shall execute
supplemental Ratable Loan Notes (the &#147;<B><I>Supplemental Notes</I></B>&#148;) evidencing such
increases, as well as such other confirmatory modifications to this Agreement
as Syndication Agent shall reasonably request. In connection with the addition
of lenders as a result of solicitations by Syndication Agent pursuant to clause
(B)&nbsp;of


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<P align="left" style="font-size: 10pt">paragraph (a)&nbsp;above (&#147;<B><I>New Banks</I></B>&#148;), Borrower, Administrative Agent and each
New Bank shall execute an Acceptance Letter in the form of <B>EXHIBIT H, </B>Borrower
shall execute a Ratable Loan Note to each New Bank in the amount of the New
Bank&#146;s Loan Commitment (a &#147;<B><I>New Note</I></B>&#148;) and Borrower and Administrative Agent
(with the consent of only the New Banks and those Banks increasing their Loan
Commitments) shall execute such confirmatory modifications to this Agreement as
Administrative Agent shall reasonably request, whereupon the New Bank shall
become, and have the rights and obligations of, a &#147;Bank&#148;, with a Loan
Commitment in the amount set forth in such Acceptance Letter. The Banks shall
have no right of approval with respect to a New Bank&#146;s becoming a Bank or the
amount of its Loan Commitment, provided, however, that Syndication Agent shall
have such right of approval, not to be unreasonably withheld. Each
Supplemental Note and New Note shall constitute &#147;Ratable Loan Notes&#148; for all
purposes of this Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;If at the time a New Bank becomes a Bank (or a Bank increases its Loan
Commitment) pursuant to this Section there is any principal outstanding under
the Ratable Loan Notes of the previously admitted Banks (the &#147;<B><I>Existing Banks</I></B>&#148;),
such New Bank (or Bank increasing its Loan Commitment) shall remit to
Administrative Agent an amount equal to the Outstanding Percentage (as defined
below) multiplied by the Loan Commitment of the New Bank (or the amount of the
increase in the Loan Commitment of a Bank increasing its Loan Commitment),
which amount shall be deemed advanced under the Ratable Loan of the New Bank
(or the Bank increasing its Loan Commitment). Administrative Agent shall pay
such amount to the Existing Banks in accordance with the Existing Banks&#146;
respective Pro Rata Shares (as calculated immediately prior to the admission of
the New Bank (or the increase in a Bank&#146;s Loan Commitment)), and such payment
shall effect an automatic reduction of the outstanding principal balance under
the respective Ratable Loan Notes of the Existing Banks. For purposes of this
Section, the term &#147;Outstanding Percentage&#148; means the ratio of (i)&nbsp;the aggregate
outstanding principal amount under the Ratable Notes of the Existing Banks,
immediately prior to the admission of the New Bank (or the increase in the Loan
Commitment of a Bank), to (ii)&nbsp;the aggregate of the Loan Commitments of the
Existing Banks (as increased pursuant to this Section, if applicable) and the
New Bank.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;The fees payable by the Borrower upon any increase of the Loan
Commitments shall be agreed upon by the Borrower, the Syndication Agent, the
New Banks and those Banks increasing their Loan Commitments. Nothing in this
Section&nbsp;2.19 shall constitute or be deemed to constitute an agreement or
commitment by any Bank to increase its Loan Commitment hereunder.


<P align="center" style="font-size: 10pt"><B>ARTICLE III</B>


<P align="center" style="font-size: 10pt"><B>YIELD PROTECTION; ILLEGALITY, ETC.</B>


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;3.01 </B><u><B>Additional Costs</B></u>. Borrower shall pay directly to each
Bank from time to time on demand such amounts as such Bank may determine to be
necessary to compensate it for any increased costs which such Bank determines
are attributable to its making or maintaining a LIBOR Loan or a LIBOR Bid Rate
Loan, or its obligation to make or maintain a LIBOR Loan or a LIBOR Bid Rate
Loan, or its obligation to Convert a Base Rate Loan to a LIBOR Loan hereunder,
or any reduction in any amount receivable by such Bank hereunder in respect of
its LIBOR Loan or LIBOR Bid Rate Loan(s) or such obligations (such increases in
costs and reductions in amounts


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<P align="left" style="font-size: 10pt">receivable being herein called &#147;<B><I>Additional Costs</I></B>&#148;), in each case resulting
from any Regulatory Change which:



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) changes the basis of taxation of any amounts payable to such
Bank under this Agreement or the Notes in respect of any such LIBOR Loan
or LIBOR Bid Rate Loan (other than changes in the rate of general
corporate, franchise, branch profit, net income or other income tax
imposed on such Bank or its Applicable Lending Office by the jurisdiction
in which such Bank has its principal office or such Applicable Lending
Office); or



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) (other than to the extent the LIBOR Reserve Requirement is taken
into account in determining the LIBOR Rate at the commencement of the
applicable Interest Period) imposes or modifies any reserve, special
deposit, deposit insurance or assessment, minimum capital, capital ratio
or similar requirements relating to any extensions of credit or other
assets of, or any deposits with or other liabilities of, such Bank
(including any LIBOR Loan or LIBOR Bid Rate Loan or any deposits referred
to in the definition of &#147;LIBOR Interest Rate&#148; in Section&nbsp;1.01), or any
commitment of such Bank (including such Bank&#146;s Loan Commitment
hereunder); or



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) imposes any other condition affecting this Agreement or the
Notes (or any of such extensions of credit or liabilities).


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Without limiting the effect of the provisions of the first paragraph of
this Section, in the event that, by reason of any Regulatory Change, any Bank
either (1)&nbsp;incurs Additional Costs based on or measured by the excess above a
specified level of the amount of a category of deposits of other liabilities of
such Bank which includes deposits by reference to which the LIBOR Interest Rate
is determined as provided in this Agreement or a category of extensions of
credit or other assets of such Bank which includes loans based on the LIBOR
Interest Rate or (2)&nbsp;becomes subject to restrictions on the amount of such a
category of liabilities or assets which it may hold, then, if such Bank so
elects by notice to Borrower (with a copy to Administrative Agent), the
obligation of such Bank to permit Elections of, to Continue, or to Convert Base
Rate Loans into, LIBOR Loans shall be suspended (in which case the provisions
of Section&nbsp;3.04 shall be applicable) until such Regulatory Change ceases to be
in effect.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Determinations and allocations by a Bank for purposes of this Section of
the effect of any Regulatory Change pursuant to the first or second paragraph
of this Section, on its costs or rate of return of making or maintaining its
Loan or portions thereof or on amounts receivable by it in respect of its Loan
or portions thereof, and the amounts required to compensate such Bank under
this Section, shall be included in a calculation of such amounts given to
Borrower and shall be conclusive absent manifest error.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;3.02 </B><u><B>Limitation on Types of Loans</B></u>. Anything herein to the
contrary notwithstanding, if, on or prior to the determination of the LIBOR
Interest Rate for any Interest Period:



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Administrative Agent reasonably determines (which determination
shall be conclusive), and provides Borrower, in writing, with reasonable
detail supporting such determination, that quotations of interest rates
for the relevant deposits referred to in the


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<P align="left" style="margin-left:2%; font-size: 10pt">definition of &#147;LIBOR Interest Rate&#148; in Section&nbsp;1.01 are not being
provided in the relevant amounts or for the relevant maturities for
purposes of determining rates of interest for the LIBOR Loans or LIBOR
Bid Rate Loans as provided in this Agreement; or



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) a Bank reasonably determines (which determination shall be
conclusive), and provides Borrower, in writing, with reasonable detail
supporting such determination, and promptly notifies Administrative Agent
that the relevant rates of interest referred to in the definition of
&#147;LIBOR Interest Rate&#148; in Section&nbsp;1.01 upon the basis of which the rate of
interest for LIBOR Loans or LIBOR Bid Rate Loans for such Interest Period
is to be determined do not adequately cover the cost to such Bank of
making or maintaining such LIBOR Loan or LIBOR Bid Rate Loan for such
Interest Period;

<P align="left" style="font-size: 10pt">then Administrative Agent shall give Borrower prompt notice thereof, and so
long as such condition remains in effect, the Banks (or, in the case of the
circumstances described in clause (2)&nbsp;above, the affected Bank) shall be under
no obligation to permit Elections of LIBOR Loans, to Convert Base Rate Loans
into LIBOR Loans or to Continue LIBOR Loans and Borrower shall, on the last
day(s) of the then current Interest Period(s) for the affected outstanding
LIBOR Loans or LIBOR Bid Rate Loans, either (x)&nbsp;prepay the affected LIBOR Loans
or LIBOR Bid Rate Loans or (y)&nbsp;Convert the affected LIBOR Loans into Base Rate
Loans in accordance with Section&nbsp;2.12 or convert the rate of interest under the
affected LIBOR Bid Rate Loans to the rate applicable to Base Rate Loans by
following the same procedures as are applicable for Conversions into Base Rate
Loans set forth in Section&nbsp;2.12.



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;3.03 </B><u><B>Illegality</B></u>. Notwithstanding any other provision of
this Agreement, in the event that it becomes unlawful for any Bank or its
Applicable Lending Office to honor its obligation to make or maintain a LIBOR
Loan or LIBOR Bid Rate Loan hereunder, to allow Elections or Continuations of a
LIBOR Loan or to Convert a Base Rate Loan into a LIBOR Loan, then such Bank
shall promptly notify Administrative Agent and Borrower thereof and such Bank&#146;s
obligation to make or maintain a LIBOR Loan or LIBOR Bid Rate Loan, or to
permit Elections of, to Continue, or to Convert its Base Rate Loan into, a
LIBOR Loan shall be suspended (in which case the provisions of Section&nbsp;3.04
shall be applicable) until such time as such Bank may again make and maintain a
LIBOR Loan or a LIBOR Bid Rate Loan.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;3.04 </B><u><B>Treatment of Affected Loans</B></u>. If the obligations of
any Bank to make or maintain a LIBOR Loan or a LIBOR Bid Rate Loan, or to
permit an Election of a LIBOR Loan, to Continue its LIBOR Loan, or to Convert
its Base Rate Loan into a LIBOR Loan, are suspended pursuant to Sections&nbsp;3.01
or 3.03 (each LIBOR Loan or LIBOR Bid Rate Loan so affected being herein called
an &#147;<B><I>Affected Loan</I></B>&#148;), such Bank&#146;s Affected Loan shall be automatically Converted
into a Base Rate Loan (or, in the case of an Affected Loan that is a LIBOR Bid
Rate Loan, the interest rate thereon shall be converted to the rate applicable
to Base Rate Loans) on the last day of the then current Interest Period for the
Affected Loan (or, in the case of a Conversion (or conversion) required by
Sections&nbsp;3.01 or 3.03, on such earlier date as such Bank may specify to
Borrower).


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To the extent that such Bank&#146;s Affected Loan has been so Converted (or the
interest rate thereon so converted), all payments and prepayments of principal
which would otherwise be applied to such Bank&#146;s Affected Loan shall be applied
instead to its Base Rate Loan (or to its


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<P align="left" style="font-size: 10pt">LIBOR Bid Rate Loan bearing interest at the converted rate) and such Bank shall
have no obligation to Convert its Base Rate Loan into a LIBOR Loan.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;3.05 </B><u><B>Certain Compensation</B></u>. Other than in connection with a
Conversion of an Affected Loan, Borrower shall pay to Administrative Agent for
the account of the applicable Bank, upon the request of such Bank through
Administrative Agent which request includes a calculation of the amount(s) due,
such amount or amounts as shall be sufficient (in the reasonable opinion of
such Bank) to compensate it for any non-administrative, actual loss, cost or
expense which such Bank reasonably determines is attributable to:



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) any payment or prepayment of a LIBOR Loan or Bid Rate Loan made
by such Bank, or any Conversion or Continuation of a LIBOR Loan (or
conversion of the rate of interest on a LIBOR Bid Rate Loan) made by such
Bank, in any such case on a date other than the last day of an applicable
Interest Period, whether by reason of acceleration or otherwise; or



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) any failure by Borrower for any reason to Convert a Base Rate
Loan or a LIBOR Loan or Continue a LIBOR Loan to be Converted or
Continued by such Bank on the date specified therefor in the relevant
notice under Section&nbsp;2.14; or



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) any failure by Borrower to borrow (or to qualify for a borrowing
of) a LIBOR Loan or Bid Rate Loan which would otherwise be made hereunder
on the date specified in the relevant Election notice under Section&nbsp;2.14
or Bid Rate Quote acceptance under Section&nbsp;2.02(e) given or submitted by
Borrower.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Without limiting the foregoing, such compensation shall include any loss
incurred in obtaining, liquidating or employing deposits from third parties,
but excluding loss of margin for the period after the date of such payment,
prepayment, Conversion or Continuation (or failure to Convert, Continue or
borrow). A determination of any Bank as to the amounts payable pursuant to
this Section shall be conclusive absent manifest error. No Bank shall make any
request pursuant to this Section&nbsp;3.05 unless such amounts due to, and costs
incurred by, such Bank are equal to or greater than $100.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;3.06 </B><u><B>Capital Adequacy</B></u>. If any Bank shall have determined
that, after the date hereof, the adoption of any applicable law, rule or
regulation regarding capital adequacy, or any change therein, or any change in
the interpretation or administration thereof by any Governmental Authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or any request or directive regarding capital adequacy
(whether or not having the force of law) of any such Governmental Authority,
central bank or comparable agency, has or would have the effect of reducing the
rate of return on capital of such Bank (or its Parent) as a consequence of such
Bank&#146;s obligations hereunder to a level below that which such Bank (or its
Parent) could have achieved but for such adoption, change, request or directive
(taking into consideration its policies with respect to capital adequacy) by an
amount deemed by such Bank to be material, then from time to time, within
fifteen (15)&nbsp;days after demand by such Bank (with a copy to Administrative
Agent), Borrower shall pay to such Bank such additional amount or amounts as
will compensate such Bank (or its Parent) for such reduction. A certificate of
any Bank claiming compensation


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<P align="left" style="font-size: 10pt">under this Section, setting forth in reasonable detail the basis therefor,
shall be conclusive absent manifest error.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;3.07 </B><u><B>Substitution of Banks</B></u>. If any Bank (an &#147;<B><I>Affected
Bank</I></B>&#148;) (1)&nbsp;makes demand upon Borrower for (or if Borrower is otherwise required
to pay) Additional Costs pursuant to Section&nbsp;3.01 or (2)&nbsp;is unable to make or
maintain a LIBOR Loan or LIBOR Bid Rate Loan as a result of a condition
described in Section&nbsp;3.03 or clause (2)&nbsp;of Section&nbsp;3.02, Borrower may, within
ninety (90)&nbsp;days of receipt of such demand or notice (or the occurrence of such
other event causing Borrower to be required to pay Additional Costs or causing
said Section&nbsp;3.03 or clause (2)&nbsp;of Section&nbsp;3.02 to be applicable), as the case
may be, give written notice (a &#147;<B><I>Replacement Notice</I></B>&#148;) to Administrative Agent
and to each Bank of Borrower&#146;s intention either (x)&nbsp;to prepay in full the
Affected Bank&#146;s Note and to terminate the Affected Bank&#146;s entire Loan
Commitment or (y)&nbsp;to replace the Affected Bank with another financial
institution (the &#147;<B><I>Replacement Bank</I></B>&#148;) designated in such Replacement Notice. In
the event Borrower opts to give the notice provided for in clause (x)&nbsp;above,
and if the Affected Bank shall not agree within thirty (30)&nbsp;days of its receipt
thereof to waive the payment of the Additional Costs in question or the effect
of the circumstances described in Section&nbsp;3.03 or clause (2)&nbsp;of Section&nbsp;3.02,
then, so long as no Default or Event of Default shall exist, Borrower may
(notwithstanding the provisions of clause (2)&nbsp;of Section&nbsp;2.10(a)) terminate the
Affected Bank&#146;s entire Loan Commitment, provided that in connection therewith
it pays to the Affected Bank all outstanding principal and accrued and unpaid
interest under the Affected Bank&#146;s Note, together with all other amounts, if
any, due from Borrower to the Affected Bank, including all amounts properly
demanded and unreimbursed under Sections&nbsp;3.01 and 3.05.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event Borrower opts to give the notice provided for in clause (y)
above, and if (i)&nbsp;Administrative Agent shall, within thirty (30)&nbsp;days of its
receipt of the Replacement Notice, notify Borrower and each Bank in writing
that the Replacement Bank is reasonably satisfactory to Administrative Agent
and (ii)&nbsp;the Affected Bank shall not, prior to the end of such thirty (30)-day
period, agree to waive the payment of the Additional Costs in question or the
effect of the circumstances described in Section&nbsp;3.03 or clause (2)&nbsp;of Section
3.02, then the Affected Bank shall, so long as no Default or Event of Default
shall exist, assign its Note and all of its rights and obligations under this
Agreement to the Replacement Bank, and the Replacement Bank shall assume all of
the Affected Bank&#146;s rights and obligations, pursuant to an agreement,
substantially in the form of an Assignment and Acceptance, executed by the
Affected Bank and the Replacement Bank. In connection with such assignment and
assumption, the Replacement Bank shall pay to the Affected Bank an amount equal
to the outstanding principal amount under the Affected Bank&#146;s Note plus all
interest accrued thereon, plus all other amounts, if any (other than the
Additional Costs in question), then due and payable to the Affected Bank;
provided, however, that prior to or simultaneously with any such assignment and
assumption, Borrower shall have paid to such Affected Bank all amounts properly
demanded and unreimbursed under Sections&nbsp;3.01 and 3.05. Upon the effective
date of such assignment and assumption, the Replacement Bank shall become a
Bank party to this Agreement and shall have all the rights and obligations of a
Bank as set forth in such Assignment and Acceptance, and the Affected Bank
shall be released from its obligations hereunder, and no further consent or
action by any party shall be required. Upon the consummation of any assignment
pursuant to this Section, a substitute Ratable Loan Note (and, if applicable,
Swing Loan Note) shall be issued to the Replacement Bank by Borrower, in
exchange for the return of the Affected Bank&#146;s Ratable Loan Note (and, if
applicable, Swing Loan Note). The obligations evidenced by such substitute
note shall constitute &#147;Obligations&#148; for all purposes of


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<P align="left" style="font-size: 10pt">this Agreement and the other Loan Documents. In connection with Borrower&#146;s
execution of substitute notes as aforesaid, Borrower shall deliver to
Administrative Agent evidence, satisfactory to Administrative Agent, of all
requisite corporate action to authorize Borrower&#146;s execution and delivery of
the substitute notes and any related documents. If the Replacement Bank is not
incorporated under the Laws of the United States of America or a state thereof,
it shall, prior to the first date on which interest or fees are payable
hereunder for its account, deliver to Borrower and Administrative Agent
certification as to exemption from deduction or withholding of any United
States federal income taxes in accordance with Section&nbsp;10.13. Each Replacement
Bank shall be deemed to have made the representations contained in, and shall
be bound by the provisions of, Section&nbsp;10.13.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Borrower, Administrative Agent and the Banks shall execute such
modifications to the Loan Documents as shall be reasonably required in
connection with and to effectuate the foregoing.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;3.08 </B><u><B>Applicability</B></u>. The provisions of this Article&nbsp;III
shall be applied to Borrower so as not to discriminate against Borrower
vis-a-vis similarly situated customers of the Banks.


<P align="center" style="font-size: 10pt"><B>ARTICLE IV</B>


<P align="center" style="font-size: 10pt"><B>CONDITIONS PRECEDENT</B>


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;4.01 </B><u><B>Conditions Precedent to the Initial Advance</B></u>. The
obligations of the Banks hereunder and the obligation of each Bank to make the
Initial Advance are subject to the condition precedent that Administrative
Agent shall have received and approved on or before the Closing Date (other
than with respect to paragraph (10)&nbsp;below which shall be required prior to the
Initial Advance) each of the following documents, and each of the following
requirements shall have been fulfilled:



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) <u>Fees and Expenses</u>. The payment of (a)&nbsp;all fees and
expenses incurred by Syndication Agent and Administrative Agent
(including, without limitation, the reasonable fees and expenses of legal
counsel) and (b)&nbsp;those fees specified in the Supplemental Fee Letter to
be paid by Borrower on or before the Closing Date;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) <u>Loan Agreement and Notes</u>. This Agreement, the Ratable
Loan Notes for each of the Banks signatory hereto, the Bid Rate Loan Note
for Administrative Agent, and the Swing Note for the Swing Lender, each
duly executed by Borrower;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) <u>Financial Statements</u>. (a)&nbsp;Audited Borrower&#146;s
Consolidated Financial Statements as of and for the year ended December
31, 2003 and (b)&nbsp;unaudited Borrower&#146;s Consolidated Financial Statements,
certified by the chief financial officer thereof, as of and for the
quarter ended March&nbsp;31, 2004;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) <u>Evidence of Formation of Borrower</u>. Certified (as of the
Closing Date) copies of Borrower&#146;s certificate of incorporation and
by-laws, with all amendments thereto, and a certificate of the Secretary
of State of the jurisdiction of formation as to its good standing
therein;


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<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) <u>Evidence of All Corporate Action</u>. Certified (as of the
Closing Date) copies of all documents evidencing the corporate action
taken by Borrower authorizing the execution, delivery and performance of
the Loan Documents and each other document to be delivered by or on
behalf of Borrower pursuant to this Agreement;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) <u>Incumbency and Signature Certificate of Borrower</u>. A
certificate (dated as of the Closing Date) of the secretary of Borrower
certifying the names and true signatures of each person authorized to
sign on behalf of Borrower;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7) <u>Solvency Certificate.</u> A duly executed Solvency
Certificate;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(8) <u>Opinion of Counsel for Borrower</u>. A favorable opinion,
dated the Closing Date, of Goodwin Procter LLP, counsel for Borrower, as
to such matters as Administrative Agent may reasonably request;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(9) <u>Authorization Letter</u>. The Authorization Letter, duly
executed by Borrower;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(10) <u>Request for Advance</u>. A request for an advance in
accordance with Section&nbsp;2.04;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(11) <u>Certificate</u>. The following statements shall be true and
Administrative Agent shall have received a certificate dated the Closing
Date signed by a duly authorized signatory of Borrower stating, to the
best of the certifying party&#146;s knowledge, the following:



<P align="left" style="margin-left:5%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All representations and warranties contained in this
Agreement and in each of the other Loan Documents are true and
correct on and as of the Closing Date as though made on and as of
such date, and



<P align="left" style="margin-left:5%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No Default or Event of Default has occurred and is
continuing, or could result from the transactions contemplated by
this Agreement and the other Loan Documents; and



<P align="left" style="margin-left:5%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) No Material Adverse Change exists on and as of the Closing
Date;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(12) <u>Supplemental Fee Letter</u>. The Supplemental Fee Letter,
duly executed by Borrower;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(13) <u>Covenant Compliance.</u> A covenant compliance certificate
of the sort required by paragraph (3)&nbsp;of Section&nbsp;6.09 for the most recent
calendar quarter for which Borrower is required to report financial
results; and



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(14) <u>Additional Materials</u>. Such other approvals, documents,
instruments or opinions as Administrative Agent may reasonably request.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;4.02 </B><u><B>Conditions Precedent to Each Advance</B></u>. The obligation
of each Bank to make each advance of the Loans, and the obligation of the
Issuing Bank to issue any Letter of Credit, shall be subject to satisfaction of
the following conditions precedent:


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<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) All conditions of Section&nbsp;4.01 shall have been and remain
satisfied as of the date of such advance or issuance;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) No Default or Event of Default shall have occurred and be
continuing as of the date of the advance or issuance or would result from
the making of such advance or issuance;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Each of the representations and warranties contained in this
Agreement and in each of the other Loan Documents shall be true and
correct in all material respects as of the date of the advance or
issuance; and



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Administrative Agent shall have received a request for an
advance in accordance with Section&nbsp;2.04 or Administrative Agent and the
Issuing Bank shall have received a request for such Letter of Credit in
accordance with Section&nbsp;2.16.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;4.03 </B><u><B>Deemed Representations</B></u>. Each request by Borrower for,
and acceptance by Borrower of, an advance of proceeds of the Loans, and each
request by Borrower for, and each issuance by the Issuing Bank of, a Letter of
Credit, shall constitute a representation and warranty by Borrower that, as of
both the date of such request and the date of such advance or issuance (1)&nbsp;no
Default or Event of Default has occurred and is continuing or would result from
the making of such advance or issuance and (2)&nbsp;each representation or warranty
contained in this Agreement or the other Loan Documents is true and correct in
all material respects.


<P align="center" style="font-size: 10pt"><B>ARTICLE V</B>


<P align="center" style="font-size: 10pt"><B>REPRESENTATIONS AND WARRANTIES</B>

<P align="left" style="font-size: 10pt">Borrower represents and warrants to Administrative Agent and each Bank as
follows:



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;5.01 </B><u><B>Due Organization</B></u>. Borrower is duly organized, validly
existing and in good standing under the Laws of the jurisdiction of its
organization, has the power and authority to own its assets and to transact the
business in which it is now engaged, and, if applicable, is duly qualified for
the conduct of business and in good standing under the Laws of each other
jurisdiction in which such qualification is required and where the failure to
be so qualified would cause a Material Adverse Change.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;5.02 </B><u><B>Power and Authority; No Conflicts; Compliance With
Laws</B></u>. The execution, delivery and performance of the obligations required
to be performed by Borrower of the Loan Documents does not and will not (a)
require the consent or approval of its shareholders or such consent or approval
has been obtained, (b)&nbsp;contravene either its certificate of incorporation or
by-laws, (c)&nbsp;to the best of Borrower&#146;s knowledge, violate any provision of, or
require any filing, registration, consent or approval under, any Law
(including, without limitation, Regulation&nbsp;U), order, writ, judgment,
injunction, decree, determination or award presently in effect having
applicability to it, (d)&nbsp;result in a breach of or constitute a default under or
require any consent under any indenture or loan or credit agreement or any
other agreement, lease or instrument to which it may be a party or by which it
or its properties may be bound or affected except for consents which have been
obtained, (e)&nbsp;result in, or require, the creation or imposition of any Lien,
upon or with respect to any of its properties now owned or hereafter acquired
or (f)&nbsp;to the best of Borrower&#146;s


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<P align="left" style="font-size: 10pt">knowledge, cause it to be in default under any such Law, order, writ,
judgment, injunction, decree, determination or award or any such indenture,
agreement, lease or instrument; to the best of its knowledge, Borrower is in
material compliance with all Laws applicable to it and its properties.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;5.03 </B><u><B>Legally Enforceable Agreements</B></u>. Each Loan Document is
a legal, valid and binding obligation of Borrower, enforceable against Borrower
in accordance with its terms, except to the extent that such enforcement may be
limited by applicable bankruptcy, insolvency and other similar Laws affecting
creditors&#146; rights generally.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;5.04 </B><u><B>Litigation</B></u>. There are no actions, suits or
proceedings pending or, to its knowledge, threatened against Borrower or any of
its Affiliates before any court or arbitrator or any Governmental Authority
which are reasonably likely to result in a Material Adverse Change or challenge
the validity or enforceability of any of the Loan Documents.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;5.05 </B><u><B>Good Title to Properties</B></u>. Borrower and each of its
Material Affiliates have good, marketable and legal title to all of the
properties and assets each of them purports to own (including, without
limitation, those reflected in the Consolidated Financial Statements referred
to in Section&nbsp;5.13), only with exceptions which do not materially detract from
the value of such property or assets or the use thereof in Borrower&#146;s and such
Material Affiliate&#146;s business, and except to the extent that any such
properties and assets have been encumbered or disposed of since the date of
such financial statements without violating any of the covenants contained in
Article&nbsp;VII or elsewhere in this Agreement. Borrower and its Material
Affiliates enjoy peaceful and undisturbed possession of all leased property
necessary in any material respect in the conduct of their respective
businesses. All such leases are valid and subsisting and are in full force and
effect.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;5.06 </B><u><B>Taxes</B></u>. Borrower has filed all tax returns (federal,
state and local) required to be filed and has paid all taxes, assessments and
governmental charges and levies due and payable without the imposition of a
penalty, including interest and penalties, except to the extent they are the
subject of a Good Faith Contest. Borrower qualifies as a real estate investment
trust under the Code.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;5.07 </B><u><B>ERISA</B></u>. Borrower is in compliance in all material
respects with all applicable provisions of ERISA. Neither a Reportable Event
nor a Prohibited Transaction has occurred with respect to any Plan which could
result in liability of Borrower; no notice of intent to terminate a Plan has
been filed nor has any Plan been terminated within the past five (5)&nbsp;years; no
circumstance exists which constitutes grounds under Section&nbsp;4042 of ERISA
entitling the PBGC to institute proceedings to terminate, or appoint a trustee
to administer, a Plan, nor has the PBGC instituted any such proceedings;
Borrower and the ERISA Affiliates have not completely or partially withdrawn
under Sections&nbsp;4201 or 4204 of ERISA from a Multiemployer Plan; Borrower and
the ERISA Affiliates have met the minimum funding requirements of Section&nbsp;412
of the Code and Section&nbsp;302 of ERISA of each with respect to the Plans of each
and there is no material &#147;Unfunded Current Liability&#148; (as such quoted term is
defined in ERISA) with respect to any Plan established or maintained by each;
and Borrower and the ERISA Affiliates have not incurred any liability to the
PBGC under ERISA (other than for the payment of premiums under Section&nbsp;4007 of
ERISA). No part of the funds to be used by Borrower in satisfaction of its
obligations under this Agreement constitute &#147;plan assets&#148; of any &#147;employee
benefit plan&#148; within the meaning of ERISA or of any &#147;plan&#148; within the meaning
of Section&nbsp;4975(e)(1) of the Code, as interpreted by the


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<P align="left" style="font-size: 10pt">Internal Revenue Service and the U.S. Department of Labor in rules,
regulations, releases, bulletins or as interpreted under applicable case law.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;5.08 </B><u><B>No Default on Outstanding Judgments or Orders, Etc</B></u>.
Borrower and each of its Material Affiliates have satisfied all judgments which
are not being appealed or which are not fully covered by insurance, and are not
in default with respect to any judgment, order, writ, injunction, decree, rule
or regulation of any court, arbitrator or federal, state, municipal or other
Governmental Authority, commission, board, bureau, agency or instrumentality,
domestic or foreign.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;5.09 </B><u><B>No Defaults on Other Agreements</B></u>. Except as disclosed
to Administrative Agent in writing (who shall provide such information,
promptly upon receipt, to each of the Banks), Borrower is not a party to any
indenture, loan or credit agreement or any lease or other agreement or
instrument or subject to any partnership, trust or other restriction which is
likely to result in a Material Adverse Change. Borrower is not in default in
any respect in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in any agreement or instrument
which is likely to result in a Material Adverse Change. Borrower and each of
its Material Affiliates are in compliance in all material respects with all
Laws applicable to it, except where no Material Adverse Change could occur as a
result of such non-compliance.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;5.10 </B><u><B>Government Regulation</B></u>. Borrower is not subject to
regulation under the Investment Company Act of 1940 or any statute or
regulation limiting its ability to incur indebtedness for money borrowed as
contemplated hereby.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;5.11 </B><u><B>Environmental Protection</B></u>. To the best of Borrower&#146;s
knowledge, none of Borrower&#146;s or its Material Affiliates&#146; properties contains
any Hazardous Materials that, under any Environmental Law currently in effect,
(1)&nbsp;would impose liability on Borrower that is likely to result in a Material
Adverse Change or (2)&nbsp;is likely to result in the imposition of a Lien on any
assets of Borrower or its Material Affiliates, in each case if not properly
handled in accordance with applicable Law or not covered by insurance or a
bond, in either case reasonably satisfactory to Administrative Agent. To the
best of Borrower&#146;s knowledge, neither it nor any of its Material Affiliates is
in material violation of, or subject to any existing, pending or threatened
material investigation or proceeding by any Governmental Authority under any
Environmental Law.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;5.12 </B><u><B>Solvency</B></u>. Borrower is, and upon consummation of the
transactions contemplated by this Agreement, the other Loan Documents and any
other documents, instruments or agreements relating thereto, will be, Solvent.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;5.13 </B><u><B>Financial Statements</B></u>. The Borrower&#146;s Consolidated
Financial Statements most recently delivered to the Banks pursuant to the terms
of this Agreement are in all material respects complete and correct and fairly
present the financial condition of the subject thereof as of the dates of and
for the periods covered by such statements, all in accordance with GAAP. There
has been no Material Adverse Change since the date of such most recently
delivered Borrower&#146;s Consolidated Financial Statements.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;5.14 </B><u><B>Valid Existence of Affiliates</B></u>. At the Closing Date,
the only Material Affiliates of Borrower are listed on <B>EXHIBIT C</B>. Each
Material Affiliate is a corporation,


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<P align="left" style="font-size: 10pt">partnership or limited liability company duly organized and existing in
good standing under the Laws of the jurisdiction of its formation. As to each
Material Affiliate, its correct name, the jurisdiction of its formation,
Borrower&#146;s percentage of beneficial interest therein, and the type of business
in which it is primarily engaged, are set forth on said <B>EXHIBIT C</B>. Borrower
and each of its Material Affiliates have the power to own their respective
properties and to carry on their respective businesses now being conducted.
Each Material Affiliate is duly qualified as a foreign corporation to do
business and is in good standing in every jurisdiction in which the nature of
the respective businesses conducted by it or its respective properties, owned
or held under lease, make such qualification necessary and where the failure to
be so qualified would cause a Material Adverse Change.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;5.15 </B><u><B>Insurance</B></u>. Borrower and each of its Material
Affiliates have in force paid insurance with financially sound and reputable
insurance companies or associations in such amounts and covering such risks as
are usually carried by companies engaged in the same type of business and
similarly situated.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;5.16 </B><u><B>Accuracy of Information; Full Disclosure</B></u>. Neither
this Agreement nor any documents, financial statements, reports, notices,
schedules, certificates, statements or other writings furnished by or on behalf
of Borrower to Administrative Agent or any Bank in connection with the
negotiation of this Agreement or the consummation of the transactions
contemplated hereby, or required herein to be furnished by or on behalf of
Borrower (other than projections which are made by Borrower in good faith),
contains any untrue or misleading statement of a material fact or omits a
material fact necessary to make the statements herein or therein not
misleading. To the best of Borrower&#146;s knowledge, there is no fact which
Borrower has not disclosed to Administrative Agent and the Banks in writing
which materially affects adversely nor, so far as Borrower can now foresee,
will materially affect adversely the business affairs or financial condition of
Borrower or the ability of Borrower to perform this Agreement and the other
Loan Documents.


<P align="center" style="font-size: 10pt"><B>ARTICLE VI</B>


<P align="center" style="font-size: 10pt"><B>AFFIRMATIVE COVENANTS</B>

<P align="left" style="font-size: 10pt">So long as any of the Notes shall remain unpaid or the Loan Commitments remain
in effect, or any other amount is owing by Borrower to any Bank Party hereunder
or under any other Loan Document, Borrower shall, and, in the case of Sections
6.01 through 6.07, inclusive, shall cause each of its Material Affiliates to:



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;6.01 </B><u><B>Maintenance of Existence</B></u>. Preserve and maintain its
legal existence and good standing in the jurisdiction of its organization, and
qualify and remain qualified as a foreign entity in each other jurisdiction in
which such qualification is required except to the extent that failure to be so
qualified in such other jurisdictions is not likely to result in a Material
Adverse Change.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;6.02 </B><u><B>Maintenance of Records</B></u>. Keep adequate records and
books of account, in which complete entries will be made reflecting all of its
financial transactions, in accordance with GAAP.


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<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;6.03 </B><u><B>Maintenance of Insurance</B></u>. At all times, maintain and
keep in force insurance with financially sound and reputable insurance
companies or associations in such amounts and covering such risks as are
usually carried by companies engaged in the same type of business and similarly
situated, which insurance shall be acceptable to Administrative Agent and may
provide for reasonable deductibility from coverage thereof. In connection with
the foregoing, it is understood that Borrower&#146;s earthquake insurance coverage
in place as of the Closing Date is acceptable to Administrative Agent.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;6.04 </B><u><B>Compliance with Laws; Payment of Taxes</B></u>. Comply in all
material respects with all Laws applicable to it or to any of its properties or
any part thereof, such compliance to include, without limitation, paying before
the same become delinquent all taxes, assessments and governmental charges
imposed upon it or upon its property, except to the extent they are the subject
of a Good Faith Contest.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;6.05 </B><u><B>Right of Inspection</B></u>. At any reasonable time and from
time to time upon reasonable notice, permit Administrative Agent or any Bank or
any agent or representative thereof to examine and make copies and abstracts
from its records and books of account and visit its properties and to discuss
its affairs, finances and accounts with the independent accountants of
Borrower.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;6.06 </B><u><B>Compliance With Environmental Laws</B></u>. Comply in all
material respects with all applicable Environmental Laws and timely pay or
cause to be paid all costs and expenses incurred in connection with such
compliance, except to the extent there is a Good Faith Contest.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;6.07 </B><u><B>Maintenance of Properties</B></u>. Do all things reasonably
necessary to maintain, preserve, protect and keep its properties in good
repair, working order and condition except where the cost thereof is not in
Borrower&#146;s best interests and the failure to do so would not result in a
Material Adverse Change.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;6.08 </B><u><B>Payment of Costs</B></u>. Pay all costs and expenses required
for the satisfaction of the conditions of this Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;6.09 </B><u><B>Reporting and Miscellaneous Document Requirements</B></u>.
Furnish directly to Administrative Agent (who shall provide, promptly upon
receipt, to each of the Banks):



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) <u>Annual Financial Statements</u>. As soon as available and in
any event within ninety (90)&nbsp;days after the end of each Fiscal Year,
Borrower&#146;s Consolidated Financial Statements as of the end of and for
such Fiscal Year, in reasonable detail and stating in comparative form
the respective figures for the corresponding date and period in the prior
Fiscal Year and audited by Borrower&#146;s Accountants;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) <u>Quarterly Financial Statements</u>. As soon as available and
in any event within forty-five (45)&nbsp;days after the end of each calendar
quarter (other than the last quarter of the Fiscal Year), the unaudited
Borrower&#146;s Consolidated Financial Statements as of the end of and for
such calendar quarter, in reasonable detail and stating in comparative
form the respective figures for the corresponding date and period in the
prior Fiscal Year;


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<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) <u>Certificate of No Default and Financial Compliance</u>.
Within ninety (90)&nbsp;days after the end of each Fiscal Year and within
forty-five (45)&nbsp;days after the end of each calendar quarter, a
certificate of Borrower&#146;s chief financial officer or treasurer (a)
stating that, to the best of his or her knowledge, no Default or Event of
Default has occurred and is continuing, or if a Default or Event of
Default has occurred and is continuing, specifying the nature thereof and
the action which is proposed to be taken with respect thereto; (b)
stating that the covenants contained in Sections&nbsp;7.02, 7.03 and 7.04 and
in Article&nbsp;VIII have been complied with (or specifying those that have
not been complied with) and including computations demonstrating such
compliance (or non-compliance); (c)&nbsp;setting forth the details of all
items comprising Total Outstanding Indebtedness, Secured Indebtedness,
Unencumbered Combined EBITDA, Interest Expense and Unsecured Indebtedness
(including amount, maturity, interest rate and amortization requirements
with respect to all Indebtedness and including an occupancy report for
each Unencumbered Wholly-Owned Asset for each of the preceding four (4)
calendar quarters and for such four (4)&nbsp;calendar quarter-period as a
whole); and (d)&nbsp;only at the end of each Fiscal Year, stating Borrower&#146;s
taxable income;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) <u>Certificate of Borrower&#146;s Accountants</u>. Simultaneously
with the delivery of the annual financial statements required by
paragraph (1)&nbsp;of this Section, (a)&nbsp;a statement of Borrower&#146;s Accountants
who audited such financial statements comparing the computations set
forth in the financial compliance certificate required by paragraph (3)
of this Section to the audited financial statements required by paragraph
(1)&nbsp;of this Section and (b)&nbsp;when the audited financial statements
required by paragraph (1)&nbsp;of this Section have a qualified auditor&#146;s
opinion, a statement of Borrower&#146;s Accountants who audited such financial
statements of whether any Default or Event of Default has occurred and is
continuing;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) <u>Notice of Litigation</u>. Promptly after the commencement
and knowledge thereof, notice of all actions, suits, and proceedings
before any court or arbitrator, affecting Borrower which, if determined
adversely to Borrower is likely to result in a Material Adverse Change;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) <u>Notices of Defaults and Events of Default</u>. As soon as
possible and in any event within ten (10)&nbsp;days after Borrower becomes
aware of the occurrence of a material Default or any Event of Default, a
written notice (which notice shall state that it is a &#147;Notice of
Default&#148;) setting forth the details of such Default or Event of Default
and the action which is proposed to be taken with respect thereto;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7) <u>Sales or Acquisitions of Assets</u>. Promptly after the
occurrence thereof, written notice (which may be in the form of a press
release sent to Administrative Agent) of (i)&nbsp;any Disposition or
acquisition (including Acquisitions) of assets (other than acquisitions
or Dispositions of investments such as certificates of deposit, Treasury
securities, money market deposits and other similar financial instruments
in the ordinary course of Borrower&#146;s cash management) with respect to
which Borrower is required to file an &#147;8-K&#148;, or (ii)&nbsp;the granting of a
Lien on any Unencumbered Wholly-Owned Asset or Unencumbered Land or
Construction-In-Process, together with, in the case of any acquisition of
such an asset, copies of all material agreements governing the
acquisition and historical financial information and Borrower&#146;s
projections with respect to the property acquired;


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<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(8) <u>Material Adverse Change</u>. As soon as is practicable and
in any event within five (5)&nbsp;days after knowledge of the occurrence of
any event or circumstance which is likely to result in or has resulted in
a Material Adverse Change, written notice thereof;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(9) <u>Offices</u>. Thirty (30)&nbsp;days&#146; prior written notice of any
change in the chief executive office or principal place of business of
Borrower;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(10) <u>Environmental and Other Notices</u>. As soon as possible
and in any event within ten (10)&nbsp;days after receipt, copies of all
Environmental Notices received by Borrower which are not received in the
ordinary course of business and which relate to a situation which is
likely to result in a Material Adverse Change;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(11) <u>Insurance Coverage</u>. Promptly, such information
concerning Borrower<B>&#145;</B>s insurance coverage as Administrative Agent may
reasonably request;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(12) <u>Proxy Statements, Etc</u>.. Promptly after the sending or
filing thereof, copies of all proxy statements, financial statements and
reports which Borrower or its Material Affiliates sends to its
shareholders, and copies of all regular, periodic and special reports,
and all registration statements which Borrower or its Material Affiliates
files with the Securities and Exchange Commission or any Governmental
Authority which may be substituted therefor, or with any national
securities exchange;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(13) <u>Operating Statements</u>. As soon as available and in any
event within forty-five (45)&nbsp;days after the end of each calendar quarter,
an operating statement for each property directly or indirectly owned in
whole or in part by Borrower;



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(14) <u>Capital Expenditures</u>. As soon as available and in any
event within forty-five (45)&nbsp;days after the end of each Fiscal Year, a
schedule of such Fiscal Year&#146;s capital expenditures and a budget for the
next Fiscal Year&#146;s planned capital expenditures for each property
directly or indirectly owned in whole or in part by Borrower; and



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(15) <u>General Information</u>. Promptly, such other information
respecting the condition or operations, financial or otherwise, of
Borrower or any properties of Borrower as Administrative Agent may from
time to time reasonably request.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;6.10 </B><u><B>Principal Prepayments as a Result of Reduction in Total
Loan Commitment</B></u>. If the outstanding principal amount under the Notes at
any time exceeds the Total Loan Commitment, Borrower shall, within ten (10)
days of Administrative Agent&#146;s written demand, make a payment in the amount of
such excess in reduction of such outstanding principal balance.


<P align="center" style="font-size: 10pt"><B>ARTICLE VII</B>


<P align="center" style="font-size: 10pt"><B>NEGATIVE COVENANTS</B>

<P align="left" style="font-size: 10pt">So long as any of the Notes shall remain unpaid, or the Loan Commitments remain
in effect, or any other amount is owing by Borrower to any Bank Party hereunder
or under any other Loan Document, Borrower shall not do any or all of the
following:



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<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;7.01 </B><u><B>Mergers Etc</B></u>. Merge or consolidate with (except where
Borrower is the surviving entity), or sell, assign, lease or otherwise dispose
of (whether in one transaction or in a series of transactions) all or
substantially all of its assets (whether now owned or hereafter acquired).


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;7.02 </B><u><B>Investments</B></u>. Directly or indirectly, make any loan or
advance to any Person or purchase or otherwise acquire any capital stock,
assets, obligations or other securities of, make any capital contribution to,
or otherwise invest in, or acquire any interest in, any Person (any such
transaction, an &#147;<B><I>Investment</I></B>&#148;) if such Investment constitutes the acquisition of
a minority interest in a Person (a &#147;<B><I>Minority Interest</I></B>&#148;) and the amount of such
Investment, together with the value of all other Minority Interests, would
exceed 20% of Capitalization Value, determined as of the end of the most recent
calendar quarter for which Borrower is required to have reported financial
results pursuant to Section&nbsp;6.09. A 50% beneficial interest in a Person, in
connection with which the holder thereof exercises joint control over such
Person with the holder(s) of the other 50% beneficial interest, shall not
constitute a &#147;Minority Interest&#148; for purposes of this Section.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;7.03 </B><u><B>Sale of Assets</B></u>. Effect (i)&nbsp;a Disposition of any of
its now owned or hereafter acquired assets (including equity interests
therein), including assets in which Borrower owns a beneficial interest through
its ownership of interests in joint ventures, (a)&nbsp;in one or more transactions
after the Closing Date aggregating more than 25% of Capitalization Value or (b)
if after giving effect to such Disposition, a Default or Event of Default would
exist, or (ii)&nbsp;the granting of a Lien on any Unencumbered Wholly-Owned Assets
or Unencumbered Land and Construction-In-Process, if after granting such Lien,
a Default or Event of Default would exist.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;7.04 </B><u><B>Distributions</B></u>. In addition to the limitations under
Section&nbsp;8.07, during the existence of any Event of Default, make, declare or
pay, directly or indirectly, any dividend or distribution to any of its equity
holders in an amount greater than the minimum dividend or distribution required
under the Code to maintain the real estate investment trust status of Borrower
under the Code, as evidenced by a detailed certificate of Borrower&#146;s chief
financial officer or treasurer reasonably satisfactory in form and substance to
Administrative Agent; provided, however, that following acceleration of the
maturity of the Notes, Borrower shall not, directly or indirectly, make,
declare or pay any dividend or distribution to any of its equity holders.


<P align="center" style="font-size: 10pt"><B>ARTICLE VIII</B>


<P align="center" style="font-size: 10pt"><B>FINANCIAL COVENANTS</B>

<P align="left" style="font-size: 10pt">So long as any of the Notes shall remain unpaid, or the Loan Commitments remain
in effect, or any other amount is owing by Borrower to any Bank Party under
this Agreement or under any other Loan Document, Borrower shall not permit or
suffer any or all of the following:



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;8.01 </B><u><B>Consolidated Tangible Net Worth</B></u>. At any time,
Consolidated Tangible Net Worth to be less than $2,000,000,000.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;8.02 </B><u><B>Relationship of Total Outstanding Indebtedness to
Capitalization Value</B></u>. At any time, Total Outstanding Indebtedness to
exceed 60% of Capitalization Value.


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<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;8.03 </B><u><B>Relationship of Combined EBITDA to Interest Expense</B></u>.
For any calendar quarter, the ratio of (1)&nbsp;Combined EBITDA to (2)&nbsp;Interest
Expense (each for the twelve (12)-month period ending with such quarter), to be
less than 2.25 to 1.00.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;8.04 </B><u><B>Relationship of Combined EBITDA to Combined Debt
Service</B></u>. For any calendar quarter, the ratio of (1)&nbsp;Combined EBITDA to (2)
Combined Debt Service (each for the twelve (12)-month period ending with such
quarter), to be less than 1.80 to 1.00.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;8.05 </B><u><B>Ratio of Unsecured Indebtedness to Unencumbered Asset
Value</B></u>. At any time, the ratio of (1)&nbsp;Unsecured Indebtedness to (2)
Unencumbered Asset Value to exceed 60%.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;8.06 </B><u><B>Relationship of Unencumbered Combined EBITDA to Unsecured
Interest Expense</B></u>. For any calendar quarter, the ratio of (1)&nbsp;Unencumbered
Combined EBITDA to (2)&nbsp;Unsecured Interest Expense (each for such calendar
quarter), to be less than 2.00 to 1.00.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;8.07 </B><u><B>Relationship of Dividends to Funds From Operations</B></u>.
For any calendar year, dividends declared by Borrower on to exceed 95% of Funds
From Operations, each for such calendar year, or such greater amount as may be
required under the Code to maintain the real estate investment trust status of
Borrower under the Code, as evidenced by a detailed certificate of Borrower&#146;s
chief financial officer or treasurer reasonably satisfactory in form and
substance to Administrative Agent.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;8.08 </B><u><B>Relationship of Secured Indebtedness to Capitalization
Value</B></u>. At any time, Secured Indebtedness to exceed 40% of Capitalization
Value.


<P align="center" style="font-size: 10pt"><B>ARTICLE IX</B>


<P align="center" style="font-size: 10pt"><B>EVENTS OF DEFAULT</B>


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;9.01 </B><u><B>Events of Default</B></u>. Any of the following events shall
be an &#147;Event of Default&#148;:



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) If Borrower shall fail to pay the principal of any Notes as and
when due, and such failure to pay shall continue unremedied for five (5)
days after the due date of such amount; or fail to pay interest accruing
on any Notes as and when due, and such failure to pay shall continue
unremedied for five (5)&nbsp;days after written notice by Administrative Agent
of such failure to pay; or fail to make any payment required under
Section&nbsp;6.10 as and when due; or fail to pay any fee or any other amount
due under this Agreement, any other Loan Document or the Supplemental Fee
Letter as and when due and such failure to pay shall continue unremedied
for two (2)&nbsp;Banking Days after written notice by Administrative Agent of
such failure to pay; or



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) If any representation or warranty made by Borrower in this
Agreement or in any other Loan Document or which is contained in any
certificate, document, opinion, financial or other statement furnished at
any time under or in connection with a Loan Document shall prove to have
been incorrect in any material respect on or as of the date made; or


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<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) If Borrower shall fail (a)&nbsp;to perform or observe any term,
covenant or agreement contained in Article&nbsp;VII or Article&nbsp;VIII; or (b)&nbsp;to
perform or observe any term, covenant or agreement contained in this
Agreement (other than obligations specifically referred to elsewhere in
this Section&nbsp;9.01) or any Loan Document, or any other document executed
by Borrower and delivered to Administrative Agent or the Banks in
connection with the transactions contemplated hereby and such failure
under this clause (b)&nbsp;shall remain unremedied for thirty (30)&nbsp;consecutive
calendar days after notice thereof (or such shorter cure period as may be
expressly prescribed in the applicable document); provided, however, that
if any such default under clause (b)&nbsp;above cannot by its nature be cured
within such thirty (30)&nbsp;day, or shorter, as the case may be, grace period
and so long as Borrower shall have commenced cure within such thirty (30)
day, or shorter, as the case may be, grace period and shall, at all times
thereafter, diligently prosecute the same to completion, Borrower shall
have an additional period, not to exceed sixty (60)&nbsp;days, to cure such
default; in no event, however, is the foregoing intended to effect an
extension of the Maturity Date; or



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) If Borrower shall fail (a)&nbsp;to pay any Recourse Debt (other than
the payment obligations described in paragraph (1)&nbsp;of this Section) in
any amount, or any Debt (other than Recourse Debt) in an amount equal to
or greater than $50,000,000, in any such case when due (whether by
scheduled maturity, required prepayment, acceleration, demand, or
otherwise) after the expiration of any applicable grace period, or (b)&nbsp;to
perform or observe any material term, covenant, or condition under any
agreement or instrument relating to any such Debt, when required to be
performed or observed, if the effect of such failure to perform or
observe is to accelerate, or to permit the acceleration of, after the
giving of notice or the lapse of time, or both (other than in cases
where, in the judgment of the Majority Banks, meaningful discussions
likely to result in (i)&nbsp;a waiver or cure of the failure to perform or
observe, or (ii)&nbsp;otherwise averting such acceleration are in progress
between Borrower and the obligee of such Debt), the maturity of such
Debt, or any such Debt shall be declared to be due and payable, or
required to be prepaid (other than by a regularly scheduled or otherwise
required prepayment), prior to the stated maturity thereof; or



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) If Borrower, or any Affiliate of Borrower to which $50,000,000
or more of Capitalization Value is attributable, shall (a)&nbsp;generally not,
or be unable to, or shall admit in writing its inability to, pay its
debts as such debts become due; or (b)&nbsp;make an assignment for the benefit
of creditors, petition or apply to any tribunal for the appointment of a
custodian, receiver or trustee for it or a substantial part of its
assets; or (c)&nbsp;commence any proceeding under any bankruptcy,
reorganization, arrangement, readjustment of debt, dissolution or
liquidation Law of any jurisdiction, whether now or hereafter in effect;
or (d)&nbsp;have had any such petition or application filed or any such
proceeding shall have been commenced, against it, in which an
adjudication or appointment is made or order for relief is entered, or
which petition, application or proceeding remains undismissed or unstayed
for a period of sixty (60)&nbsp;days or more; or (e)&nbsp;be the subject of any
proceeding under which all or a substantial part of its assets may be
subject to seizure, forfeiture or divestiture; or (f)&nbsp;by any act or
omission indicate its consent to, approval of or acquiescence in any such
petition, application or proceeding or order for relief or the
appointment of a custodian, receiver or trustee for all or any
substantial part of its property; or (g)&nbsp;suffer any such custodianship,


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<P align="left" style="margin-left:2%; font-size: 10pt">receivership or trusteeship for all or any substantial part of its
property, to continue undischarged for a period of sixty (60)&nbsp;days or
more; or



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) If one or more judgments, decrees or orders for the payment of
money in an amount in excess of 5% of Consolidated Tangible Net Worth
(excluding any such judgments, decrees or orders which are fully covered
by insurance) in the aggregate shall be rendered against Borrower or any
of its Material Affiliates, and any such judgments, decrees or orders
shall continue unsatisfied and in effect for a period of thirty (30)
consecutive days without being vacated, discharged, satisfied or stayed
or bonded pending appeal; or



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7) If any of the following events shall occur or exist with respect
to Borrower or any ERISA Affiliate: (a)&nbsp;any Prohibited Transaction
involving any Plan; (b)&nbsp;any Reportable Event with respect to any Plan;
(c)&nbsp;the filing under Section&nbsp;4041 of ERISA of a notice of intent to
terminate any Plan or the termination of any Plan; (d)&nbsp;any event or
circumstance which would constitute grounds for the termination of, or
for the appointment of a trustee to administer, any Plan under Section
4042 of ERISA, or the institution by the PBGC of proceedings for any such
termination or appointment under Section&nbsp;4042 of ERISA; or (e)&nbsp;complete
or partial withdrawal under Section&nbsp;4201 or 4204 of ERISA from a
Multiemployer Plan or the reorganization, insolvency, or termination of
any Multiemployer Plan; and in each case above, if such event or
conditions, if any, could in the reasonable opinion of any Bank subject
Borrower to any tax, penalty, or other liability to a Plan, Multiemployer
Plan, the PBGC or otherwise (or any combination thereof) which in the
aggregate exceeds or is likely to exceed $50,000; or



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(8) If at any time Borrower is not a qualified real estate
investment trust under Sections&nbsp;856 through 860 of the Code or is not a
publicly traded company listed on the New York Stock Exchange; or



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(9) If at any time any portion of Borrower&#146;s assets constitute plan
assets for ERISA purposes (within the meaning of C.F.R. &#167;2510.3-101); or



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(10) If, in the reasonable judgment of all of the Banks (and the
basis for such determination is provided to Borrower in writing in
reasonable detail), there shall occur a Material Adverse Change; or



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(11) If, during any period of up to twelve (12)&nbsp;consecutive months
commencing on or after the Closing Date, individuals who were directors
of Borrower at the beginning of such period (the &#147;<B><I>Continuing Directors</I></B>&#148;),
plus any new directors whose election or appointment was approved by a
majority of the Continuing Directors then in office, shall cease for any
reason to constitute a majority of the Board of Directors of Borrower; or



<P align="left" style="margin-left:2%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(12) If, through any transaction or series of related transactions,
any Person (including Affiliates of such Person) shall acquire beneficial
ownership, directly or indirectly, of securities of Borrower (or of
securities convertible into securities of Borrower) representing 25% or
more of the combined voting power of all securities of Borrower entitled
to vote in the election of directors.


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<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;9.02 </B><u><B>Remedies</B></u>. If any Event of Default shall occur and be
continuing, Administrative Agent shall, upon request of the Majority Banks, by
notice to Borrower, (1)&nbsp;declare the outstanding balance of the Notes, all
interest thereon, and all other amounts payable under this Agreement to be
forthwith due and payable, whereupon such balance, all such interest, and all
such amounts due under this Agreement and under any other Loan Document shall
become and be forthwith due and payable, without presentment, demand, protest,
or further notice of any kind, all of which are hereby expressly waived by
Borrower; and/or (2)&nbsp;exercise any remedies provided in any of the Loan
Documents or by law. Notwithstanding the foregoing, if an Event of Default
under Section&nbsp;9.01(10) shall occur and be continuing, Administrative Agent
shall not be entitled to exercise the foregoing remedies until (1)&nbsp;it has
received a written notice from all of the Banks (the &#147;<B><I>Unanimous Bank Notices</I></B>&#148;)
(i)&nbsp;requesting Administrative Agent exercise such remedies and (ii)&nbsp;indicating
each Bank&#146;s conclusion in its reasonable judgment that a Material Adverse
Change has occurred and (2)&nbsp;Administrative Agent has provided notice to
Borrower, together with copies of all of the Unanimous Bank Notices.


<P align="center" style="font-size: 10pt"><B>ARTICLE X</B>


<P align="center" style="font-size: 10pt"><B>ADMINISTRATIVE AGENT; RELATIONS AMONG BANKS</B>


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.01 </B><u><B>Appointment, Powers and Immunities of Administrative
Agent</B></u>. Each Bank hereby irrevocably appoints and authorizes Administrative
Agent to act as its agent hereunder and under any other Loan Document with such
powers as are specifically delegated to Administrative Agent by the terms of
this Agreement and any other Loan Document, together with such other powers as
are reasonably incidental thereto. Administrative Agent shall have no duties
or responsibilities except those expressly set forth in this Agreement and any
other Loan Document or required by Law, and shall not by reason of this
Agreement be a fiduciary or trustee for any Bank except to the extent that
Administrative Agent acts as an agent with respect to the receipt or payment of
funds (nor shall Administrative Agent have any fiduciary duty to Borrower nor
shall any Bank have any fiduciary duty to Borrower or to any other Bank). No
implied covenants, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or otherwise exist against Administrative Agent.
Neither Administrative Agent nor any of its directors, officers, employees,
attorneys-in-fact or affiliates shall be responsible to the Banks for any
recitals, statements, representations or warranties made by Borrower or any
officer, partner or official of Borrower or any other Person contained in this
Agreement or any other Loan Document, or in any certificate or other document
or instrument referred to or provided for in, or received by any of them under,
this Agreement or any other Loan Document, or for the value, legality,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Loan Document or any other document or instrument
referred to or provided for herein or therein, for the perfection or priority
of any Lien securing the Obligations or for any failure by Borrower to perform
any of its obligations hereunder or thereunder. Administrative Agent may
employ agents and attorneys-in-fact and shall not be responsible, except as to
money or securities received by it or its authorized agents, for the negligence
or misconduct of any such agents or attorneys-in-fact selected by it with
reasonable care. Neither Administrative Agent nor any of its directors,
officers, employees, attorneys-in-fact, agents or affiliates shall be liable or
responsible for any action taken or omitted to be taken by it or them hereunder
or under any other Loan Document or in connection herewith or therewith, except
for its or their own gross negligence or willful misconduct. Borrower


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<P align="left" style="font-size: 10pt">shall pay any fee agreed to by Borrower and Administrative Agent with
respect to Administrative Agent&#146;s services hereunder.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.02 </B><u><B>Reliance by Administrative Agent</B></u>. Administrative
Agent shall be entitled to rely upon any certification, notice or other
communication (including any thereof by telephone, telex, telegram or cable)
believed by it to be genuine and correct and to have been signed or sent by or
on behalf of the proper Person or Persons, and upon advice and statements of
legal counsel, independent accountants and other experts selected by
Administrative Agent. Administrative Agent may deem and treat each Bank as the
holder of the Loan made by it for all purposes hereof and shall not be required
to deal with any Person who has acquired a Participation in any Loan or
Participation from a Bank. As to any matters not expressly provided for by
this Agreement or any other Loan Document, Administrative Agent shall in all
cases be fully protected in acting, or in refraining from acting, hereunder in
accordance with instructions signed by the Majority Banks, Super-Majority Banks
or all Banks, as required by this Agreement, and such instructions of the
Majority Banks, Super-Majority Banks or all Banks, as the case may be, and any
action taken or failure to act pursuant thereto, shall be binding on all of the
Banks and any other holder of all or any portion of any Loan or Participation.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.03 </B><u><B>Defaults</B></u>. Administrative Agent shall not be deemed
to have knowledge of the occurrence of a Default or Event of Default unless
Administrative Agent has received notice from a Bank or Borrower specifying
such Default or Event of Default and stating that such notice is a &#147;Notice of
Default.&#148; In the event that Administrative Agent receives such a notice of the
occurrence of a Default or Event of Default, Administrative Agent shall give
prompt notice thereof to the Banks. Administrative Agent, following
consultation with the Banks, shall (subject to Section&nbsp;10.07 and Section&nbsp;12.02)
take such action with respect to such Default or Event of Default which is
continuing as shall be directed by the Majority Banks; provided that, unless
and until Administrative Agent shall have received such directions,
Administrative Agent may take such action, or refrain from taking such action,
with respect to such Default or Event of Default as it shall deem advisable in
the best interest of the Banks; and provided further that Administrative Agent
shall not send a notice of Default or acceleration to Borrower without the
approval of the Majority Banks. In no event shall Administrative Agent be
required to take any such action which it determines to be contrary to Law or
to the Loan Documents. Each of the Banks acknowledges and agrees that no
individual Bank may separately enforce or exercise any of the provisions of any
of the Loan Documents, including, without limitation, the Notes, other than
through Administrative Agent.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.04 </B><u><B>Rights of Administrative Agent as a Bank</B></u>. With
respect to its Loan Commitment and the Loan provided by it, Administrative
Agent in its capacity as a Bank hereunder shall have the same rights and powers
hereunder as any other Bank and may exercise the same as though it were not
acting as Administrative Agent, and the term &#147;Bank&#148; or &#147;Banks&#148; shall, unless
the context otherwise indicates, include Administrative Agent in its capacity
as a Bank. Administrative Agent and its Affiliates may (without having to
account therefor to any Bank) accept deposits from, lend money to (on a secured
or unsecured basis), and generally engage in any kind of banking, trust or
other business with Borrower (and any Affiliates of Borrower) as if it were not
acting as Administrative Agent.


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<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.05 </B><u><B>Indemnification of Administrative Agent</B></u>. Each Bank
agrees to indemnify Administrative Agent (to the extent not reimbursed under
Section&nbsp;12.04 or under the applicable provisions of any other Loan Document,
but without limiting the obligations of Borrower under Section&nbsp;12.04 or such
provisions), for its Pro Rata Share of any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind and nature whatsoever which may be imposed on,
incurred by or asserted against Administrative Agent in any way relating to or
arising out of this Agreement, any other Loan Document or any other documents
contemplated by or referred to herein or the transactions contemplated hereby
or thereby (including, without limitation, the costs and expenses which
Borrower is obligated to pay under Section&nbsp;12.04) or under the applicable
provisions of any other Loan Document or the enforcement of any of the terms
hereof or thereof or of any such other documents or instruments; provided that
no Bank shall be liable for (1)&nbsp;any of the foregoing to the extent they arise
from the gross negligence or willful misconduct of the party to be indemnified,
(2)&nbsp;any loss of principal or interest with respect to Administrative Agent&#146;s
Loan or (3)&nbsp;any loss suffered by Administrative Agent in connection with a swap
or other interest rate hedging arrangement entered into with Borrower.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.06 </B><u><B>Non-Reliance on Administrative Agent and Other Banks</B></u>.
Each Bank agrees that it has, independently and without reliance on
Administrative Agent or any other Bank, and based on such documents and
information as it has deemed appropriate, made its own credit analysis of
Borrower and the decision to enter into this Agreement and that it will,
independently and without reliance upon Administrative Agent or any other Bank,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own analysis and decisions in taking or not taking
action under this Agreement or any other Loan Document. Administrative Agent
shall not be required to keep itself informed as to the performance or
observance by Borrower of this Agreement or any other Loan Document or any
other document referred to or provided for herein or therein or to inspect the
properties or books of Borrower. Except for notices, reports and other
documents and information expressly required to be furnished to the Banks by
Administrative Agent hereunder, Administrative Agent shall not have any duty or
responsibility to provide any Bank with any credit or other information
concerning the affairs, financial condition or business of Borrower (or any
Affiliate of Borrower) which may come into the possession of Administrative
Agent or any of its Affiliates. Administrative Agent shall not be required to
file this Agreement, any other Loan Document or any document or instrument
referred to herein or therein, for record or give notice of this Agreement, any
other Loan Document or any document or instrument referred to herein or
therein, to anyone.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.07 </B><u><B>Failure of Administrative Agent to Act</B></u>. Except for
action expressly required of Administrative Agent hereunder, Administrative
Agent shall in all cases be fully justified in failing or refusing to act
hereunder unless it shall have received further assurances (which may include
cash collateral) of the indemnification obligations of the Banks under Section
10.05 in respect of any and all liability and expense which may be incurred by
it by reason of taking or continuing to take any such action. If any indemnity
furnished by the Banks to Administrative Agent for any purpose shall, in the
reasonable opinion of Administrative Agent, be insufficient or become impaired,
Administrative Agent may call for additional indemnity and cease, or not
commence, to do the action indemnified against until such additional indemnity
is furnished.


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<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.08 </B><u><B>Resignation or Removal of Administrative Agent</B></u>.
Administrative Agent hereby agrees not to unilaterally resign except in the
event it becomes an Affected Bank and is removed or replaced as a Bank pursuant
to Section&nbsp;3.07, in which event it shall have the right to resign. Fleet
agrees that it may be replaced as Administrative Agent by the Majority Banks if
its Loan Commitment is reduced to $25,000,000 or less through assignments to
Assignees. In addition, Administrative Agent may be removed at any time with
cause by the Super-Majority Banks. In the case of any removal of
Administrative Agent, Borrower and the Banks shall be promptly notified
thereof. Upon any such resignation or removal of Administrative Agent, the
Super-Majority Banks shall have the right to appoint a successor Administrative
Agent, which successor Administrative Agent, so long as it is reasonably
acceptable to the Super-Majority Banks, shall be that Bank then having the
greatest Loan Commitment; if two (2)&nbsp;or more Banks have an equal greatest Loan
Commitment, the Super-Majority Banks shall select between or among them. If no
successor Administrative Agent shall have been so appointed by the
Super-Majority Banks and shall have accepted such appointment within thirty
(30)&nbsp;days after the Super-Majority Banks&#146; removal of the retiring
Administrative Agent, then the retiring Administrative Agent may, on behalf of
the Banks, appoint a successor Administrative Agent, which shall be one of the
Banks. The Super-Majority Banks or the retiring Administrative Agent, as the
case may be, shall upon the appointment of a successor Administrative Agent
promptly so notify Borrower and the other Banks. Upon the acceptance of any
appointment as Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder. After any retiring
Administrative Agent&#146;s removal hereunder as Administrative Agent, the
provisions of this Article&nbsp;X shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it while it was acting
as Administrative Agent.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.09 </B><u><B>Amendments Concerning Agency Function</B></u>.
Notwithstanding anything to the contrary contained herein, Administrative Agent
shall not be bound by any waiver, amendment, supplement or modification hereof
or of any other Loan Document which affects its duties, rights, and/or function
hereunder or thereunder unless it shall have given its prior written consent
thereto.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.10 </B><u><B>Liability of Administrative Agent</B></u>. Administrative
Agent shall not have any liabilities or responsibilities to Borrower on account
of the failure of any Bank to perform its obligations hereunder or to any Bank
on account of the failure of Borrower to perform its obligations hereunder or
under any other Loan Document.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.11 </B><u><B>Transfer of Agency Function</B></u>. Without the consent of
Borrower or any Bank, Administrative Agent may at any time or from time to time
transfer its functions as Administrative Agent hereunder to any of its offices
wherever located in the United States, provided that Administrative Agent shall
promptly notify Borrower and the Banks thereof.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.12 </B><u><B>Non-Receipt of Funds by Administrative Agent</B></u>. (a)
Unless Administrative Agent shall have received notice from a Bank or Borrower
(either one as appropriate being the &#147;Payor&#148;) prior to the date on which such
Bank is to make payment hereunder to Administrative Agent of the proceeds of a
Loan or Borrower is to make payment to Administrative Agent, as the case may be
(either such payment being a &#147;<B><I>Required Payment</I></B>&#148;), which notice shall be
effective upon receipt, that the Payor will not make the Required Payment in


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<P align="left" style="font-size: 10pt">full to Administrative Agent, Administrative Agent may assume that the
Required Payment has been made in full to Administrative Agent on such date,
and Administrative Agent in its sole discretion may, but shall not be obligated
to, in reliance upon such assumption, make the amount thereof available to the
intended recipient on such date. If and to the extent the Payor shall not have
in fact so made the Required Payment in full to Administrative Agent, the
recipient of such payment shall repay to Administrative Agent forthwith on
demand such amount made available to it together with interest thereon, for
each day from the date such amount was so made available by Administrative
Agent until the date Administrative Agent recovers such amount, at the
customary rate set by Administrative Agent for the correction of errors among
Banks for three (3)&nbsp;Banking Days and thereafter at the Base Rate.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;If, after Administrative Agent has paid each Bank&#146;s share of any
payment received or applied by Administrative Agent in respect of the Loan,
that payment is rescinded or must otherwise be returned or paid over by
Administrative Agent, whether pursuant to any bankruptcy or insolvency Law,
sharing of payments clause of any loan agreement or otherwise, such Bank shall,
at Administrative Agent&#146;s request, promptly return its share of such payment or
application to Administrative Agent, together with such Bank&#146;s proportionate
share of any interest or other amount required to be paid by Administrative
Agent with respect to such payment or application. In addition, if a court of
competent jurisdiction shall adjudge that any amount received and distributed
by Administrative Agent is to be repaid, each Person to whom any such
distribution shall have been made shall either repay to Administrative Agent
its share of the amount so adjudged to be repaid or shall pay over to the same
in such manner and to such Persons as shall be determined by such court.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.13 </B><u><B>Withholding Taxes</B></u>. Each Bank represents that it is
entitled to receive any payments to be made to it hereunder without the
withholding of any tax and will furnish to Administrative Agent such forms,
certifications, statements and other documents as Administrative Agent may
request from time to time to evidence such Bank&#146;s exemption from the
withholding of any tax imposed by any jurisdiction or to enable Administrative
Agent or Borrower to comply with any applicable Laws or regulations relating
thereto. Without limiting the effect of the foregoing, if any Bank is not
created or organized under the Laws of the United States of America or any
state thereof, such Bank will furnish to Administrative Agent a United States
Internal Revenue Service Form W-8ECI in respect of all payments to be made to
such Bank by Borrower or Administrative Agent under this Agreement or any other
Loan Document or a United States Internal Revenue Service Form W-8BEN
establishing such Bank&#146;s complete exemption from United States withholding tax
in respect of payments to be made to such Bank by Borrower or Administrative
Agent under this Agreement or any other Loan Document, or such other forms,
certifications, statements or documents, duly executed and completed by such
Bank as evidence of such Bank&#146;s exemption from the withholding of U.S. tax with
respect thereto. Administrative Agent shall not be obligated to make any
payments hereunder to such Bank in respect of any Loan or Participation or such
Bank&#146;s Loan Commitment or obligation to purchase Participations until such Bank
shall have furnished to Administrative Agent the requested form, certification,
statement or document.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.14 </B><u><B>Minimum Commitment by Syndication Agent</B></u>. In the
event JPMC&#146;s individual Loan Commitment is reduced to $25,000,000 or less
through assignments, Borrower may replace JPMC as Syndication Agent with a
lending institution selected by Borrower. In


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<P align="left" style="font-size: 10pt">making such selection, Borrower will consider in good faith Fleet, Morgan
Stanley Bank, Wells Fargo Bank, National Association and Deutsche Bank Trust
Company Americas<B>.</B>


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.15 </B><u><B>Pro Rata Treatment</B></u>. Except to the extent otherwise
provided, (1)&nbsp;each advance of proceeds of the Ratable Loans shall be made by
the Banks; (2)&nbsp;each reduction of the amount of the Total Loan Commitment under
Section&nbsp;2.10 shall be applied to the Loan Commitments of the Banks; and (3)
each payment of the fee accruing under paragraph (b)&nbsp;of Section&nbsp;2.07 and clause
(1)&nbsp;of Section&nbsp;2.16(f) shall be made for the account of the Banks, ratably
according to the amounts of their respective Loan Commitments. Except as
otherwise expressly provided in this Agreement, each payment in respect of
principal or interest under the Loans shall be applied to such obligations
owing to the Banks pro rata according to the respective amounts then due and
owing to the Banks.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.16 </B><u><B>Sharing of Payments Among Banks</B></u>. If a Bank shall
obtain payment of any principal of or interest on any Loan made by it through
the exercise of any right of setoff, banker&#146;s lien, counterclaim, or by any
other means (including direct payment), and such payment results in such Bank
receiving a greater payment than it would have been entitled to had such
payment been paid directly to Administrative Agent for disbursement to the
Banks, then such Bank shall promptly purchase for cash from the other Banks
Participations in the Loans made by the other Banks in such amounts, and make
such other adjustments from time to time as shall be equitable to the end that
all the Banks shall share ratably the benefit of such payment. To such end the
Banks shall make appropriate adjustments among themselves (by the resale of
Participations sold or otherwise) if such payment is rescinded or must
otherwise be restored. Borrower agrees that any Bank so purchasing a
Participation in the Loans made by other Banks may exercise all rights of
setoff, banker&#146;s lien, counterclaim or similar rights with respect to such
Participation. Nothing contained herein shall require any Bank to exercise any
such right or shall affect the right of any Bank to exercise, and retain the
benefits of exercising, any such right with respect to any other indebtedness
of Borrower.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;10.17 </B><u><B>Possession of Documents</B></u>. Each Bank shall keep
possession of its own Ratable Loan Note and the Swing Lender shall keep
possession of its Swing Loan Note. Administrative Agent shall hold all the
other Loan Documents and related documents in its possession and maintain
separate records and accounts with respect thereto, and shall permit the Banks
and their representatives access at all reasonable times to inspect such Loan
Documents, related documents, records and accounts.


<P align="center" style="font-size: 10pt"><B>ARTICLE XI</B>


<P align="center" style="font-size: 10pt"><B>NATURE OF OBLIGATIONS</B>


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;11.01 </B><u><B>Absolute and Unconditional Obligations</B></u>. Borrower
acknowledges and agrees that its obligations and liabilities under this
Agreement and under the other Loan Documents shall be absolute and
unconditional irrespective of (1)&nbsp;any lack of validity or enforceability of any
of the Obligations, any Loan Documents, or any agreement or instrument relating
thereto; (2)&nbsp;any change in the time, manner or place of payment of, or in any
other term in respect of, all or any of the Obligations, or any other amendment
or waiver of or consent to any departure from any Loan Documents or any other
documents or instruments executed in connection with or related to the


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<P align="left" style="font-size: 10pt">Obligations; (3)&nbsp;any exchange or release of any collateral, if any, or of
any other Person from all or any of the Obligations; or (4)&nbsp;any other
circumstances which might otherwise constitute a defense available to, or a
discharge of, Borrower or any other Person in respect of the Obligations.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The obligations and liabilities of Borrower under this Agreement and other
Loan Documents shall not be conditioned or contingent upon the pursuit by any
Bank or any other Person at any time of any right or remedy against Borrower or
any other Person which may be or become liable in respect of all or any part of
the Obligations or against any collateral or security or guarantee therefor or
right of setoff with respect thereto.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;11.02 </B><u><B>Non-Recourse to Borrower&#146;s Principals</B></u>.
Notwithstanding anything to the contrary contained herein, in any of the other
Loan Documents, or in any other instruments, certificates, documents or
agreements executed in connection with the Loans (all of the foregoing, for
purposes of this Section, hereinafter referred to, individually and
collectively, as the &#147;<B><I>Relevant Documents</I></B>&#148;), no recourse under or upon any
Obligation, representation, warranty, promise or other matter whatsoever shall
be had against any of Borrower&#146;s Principals and each Bank expressly waives and
releases, on behalf of itself and its successors and assigns, all right to
assert any liability whatsoever under or with respect to the Relevant Documents
against, or to satisfy any claim or obligation arising thereunder against, any
of Borrower&#146;s Principals or out of any assets of Borrower&#146;s Principals,
provided, however, that nothing in this Section shall be deemed to (1)&nbsp;release
Borrower from any personal liability pursuant to, or from any of its respective
obligations under, the Relevant Documents, or from personal liability for its
fraudulent actions or fraudulent omissions; (2)&nbsp;release any of Borrower&#146;s
Principals from personal liability for its or his own fraudulent actions or
fraudulent omissions; (3)&nbsp;constitute a waiver of any obligation evidenced or
secured by, or contained in, the Relevant Documents or affect in any way the
validity or enforceability of the Relevant Documents; or (4)&nbsp;limit the right of
Administrative Agent and/or the Banks to proceed against or realize upon any
collateral hereafter given for the Loans or any and all of the assets of
Borrower (notwithstanding the fact that any or all of Borrower&#146;s Principals
have an ownership interest in Borrower and, thereby, an interest in the assets
of Borrower) or to name Borrower (or, to the extent that the same are required
by applicable Law or are determined by a court to be necessary parties in
connection with an action or suit against Borrower or any collateral hereafter
given for the Loans, any of Borrower&#146;s Principals) as a party defendant in, and
to enforce against any collateral hereafter given for the Loans and/or assets
of Borrower any judgment obtained by Administrative Agent and/or the Banks with
respect to, any action or suit under the Relevant Documents so long as no
judgment shall be taken (except to the extent taking a judgment is required by
applicable Law or determined by a court to be necessary to preserve
Administrative Agent&#146;s and/or Banks&#146; rights against any collateral hereafter
given for the Loans or Borrower, but not otherwise) or shall be enforced
against Borrower&#146;s Principals or their assets.


<P align="center" style="font-size: 10pt"><B>ARTICLE XII</B>


<P align="center" style="font-size: 10pt"><B>MISCELLANEOUS</B>


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.01 </B><u><B>Binding Effect of Request for Advance</B></u>. Borrower
agrees that, by its acceptance of any advance of proceeds of the Loans under
this Agreement, it shall be bound in all respects by the request for advance
submitted on its behalf in connection therewith with the same


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<P align="left" style="font-size: 10pt">force and effect as if Borrower had itself executed and submitted the
request for advance and whether or not the request for advance is executed
and/or submitted by an authorized person.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.02 </B><u><B>Amendments and Waivers</B></u>. No amendment or waiver of
any provision of this Agreement or any other Loan Document nor consent to any
departure by Borrower therefrom, shall in any event be effective unless the
same shall be in writing and signed by the Majority Banks and, solely for
purposes of its acknowledgment thereof, Administrative Agent, and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given, provided, however, that no amendment, waiver
or consent shall, unless in writing and signed or consented to by (A)&nbsp;the
Super-Majority Banks modify any provision of Section&nbsp;7.02, Article&nbsp;VIII or
clause (11)&nbsp;or (12)&nbsp;of Section&nbsp;9.01, or any other provision requiring the
consent of the Super-Majority Banks; and (B)&nbsp;all the Banks do any of the
following: (1)&nbsp;reduce the principal of, or interest on, the Notes or any fees
due hereunder or any other amount due hereunder or under any Loan Document; (2)
except as provided in Section&nbsp;2.18, postpone any date fixed for any payment of
principal of, or interest on, the Notes or any fees due hereunder or under any
Loan Document; (3)&nbsp;change the definition of &#147;Majority Banks&#148; or &#147;Super-Majority
Banks&#148;; (4)&nbsp;amend this Section or any other provision requiring the consent of
all the Banks; or (5)&nbsp;waive any default under paragraph (5)&nbsp;of Section&nbsp;9.01.
Any advance of proceeds of the Loans made, or any Letter of Credit issued,
prior to or without the fulfillment by Borrower of all of the conditions
precedent thereto, whether or not known to Administrative Agent and the Banks,
shall not constitute a waiver of the requirement that all conditions, including
the non-performed conditions, shall be required with respect to all future
advances and issuances of Letters of Credit. No failure on the part of
Administrative Agent or any Bank to exercise, and no delay in exercising, any
right hereunder shall operate as a waiver thereof or preclude any other or
further exercise thereof or the exercise of any other right. The remedies
herein provided are cumulative and not exclusive of any remedies provided by
law. All communications from Administrative Agent to the Banks requesting the
Banks&#146; determination, consent, approval or disapproval (i)&nbsp;shall be given in
the form of a written notice to each Bank, (ii)&nbsp;shall be accompanied by a
description of the matter or thing as to which such determination, approval,
consent or disapproval is requested and (iii)&nbsp;shall include Administrative
Agent&#146;s recommended course of action or determination in respect thereof. Each
Bank shall reply promptly, but in any event within ten (10)&nbsp;Banking Days (or
five (5)&nbsp;Banking Days with respect to any decision to accelerate or stop
acceleration of the Loan) after receipt of the request therefor by
Administrative Agent (the &#147;<B><I>Bank Reply Period</I></B>&#148;). Unless a Bank shall give
written notice to Administrative Agent that it objects to the recommendation or
determination of Administrative Agent (together with a written explanation of
the reasons behind such objection) within the Bank Reply Period, such Bank
shall be deemed to have approved or consented to such recommendation or
determination.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.03 </B><u><B>Usury</B></u>. Anything herein to the contrary
notwithstanding, the obligations of Borrower under this Agreement and the Notes
shall be subject to the limitation that payments of interest shall not be
required to the extent that receipt thereof would be contrary to provisions of
Law applicable to a Bank limiting rates of interest which may be charged or
collected by such Bank.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.04 </B><u><B>Expenses; Indemnification</B></u>. Borrower agrees (i)&nbsp;to
reimburse Administrative Agent on demand for all costs, expenses, and charges
(including, without limitation, all reasonable fees and charges of engineers,
appraisers and legal counsel) incurred by it in


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<P align="left" style="font-size: 10pt">connection with the Loans and the preparation, execution, delivery and
administration of the Loan Documents and any amendment or waiver with respect
thereto, and (ii)&nbsp;to reimburse each of the Banks for reasonable legal costs,
expenses and charges incurred by each of the Banks in connection with the
performance or enforcement of this Agreement, the Notes, or any other Loan
Documents; provided, however, that Borrower is not responsible for costs,
expenses and charges incurred by the Bank Parties in connection with the
administration or syndication of the Loans (other than the fees required by the
Supplemental Fee Letter). Borrower agrees to indemnify Administrative Agent
and each Bank and their respective directors, officers, employees and agents
from, and hold each of them harmless against, any and all losses, liabilities,
claims, damages or expenses incurred by any of them arising out of or by reason
of (x)&nbsp;any claims by brokers due to acts or omissions by Borrower, (y)&nbsp;this
Agreement or the transactions contemplated hereby or (z)&nbsp;any investigation or
litigation or other proceedings (including any threatened investigation or
litigation or other proceedings) relating to any actual or proposed use by
Borrower of the proceeds of the Loans, including without limitation, the
reasonable fees and disbursements of counsel incurred in connection with any
such investigation or litigation or other proceedings (but excluding any such
losses, liabilities, claims, damages or expenses incurred by reason of the
gross negligence or willful misconduct of the Person to be indemnified).


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The obligations of Borrower under this Section and under Article&nbsp;III shall
survive the repayment of all amounts due under or in connection with any of the
Loan Documents and the termination of the Loans, provided, however, that in the
case of Article&nbsp;III, such obligations shall survive only for a period of ninety
(90)&nbsp;days after such repayment and termination.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.05 </B><u><B>Assignment; Participation</B></u>. This Agreement shall be
binding upon, and shall inure to the benefit of, Borrower, Administrative
Agent, the Banks and their respective successors and permitted assigns.
Borrower may not assign or transfer its rights or obligations hereunder.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any Bank may at any time grant to one or more banks or other institutions
(each a &#147;<B><I>Participant</I></B>&#148;) participating interests in its Loan (each a
"<B><I>Participation</I></B>&#148;). In the event of any such grant by a Bank of a Participation
to a Participant, whether or not Borrower or Administrative Agent was given
notice, such Bank shall remain responsible for the performance of its
obligations hereunder, and Borrower and Administrative Agent shall continue to
deal solely and directly with such Bank in connection with such Bank&#146;s rights
and obligations hereunder. Any agreement pursuant to which any Bank may grant
such a participating interest shall provide that such Bank shall retain the
sole right and responsibility to enforce the obligations of Borrower hereunder
and under any other Loan Document including, without limitation, the right to
approve any amendment, modification or waiver of any provision of this
Agreement or any other Loan Document; provided that such participation
agreement may provide that such Bank will not agree to any modification,
amendment or waiver of this Agreement described in clause (B)(1) through (B)(5)
of Section&nbsp;12.02 without the consent of the Participant. Any Participant
hereunder shall have the same benefits as any Bank with respect to the yield
protection and increased cost provisions of Article&nbsp;III.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any Bank may at any time assign to any bank or other institution with the
consent of Administrative Agent and the Issuing Bank and, provided there exists
no Event of Default, Borrower, which consents shall not be unreasonably
withheld or delayed (such assignee, an &#147;<B><I>Assignee</I></B>&#148;), all, or a proportionate
part of all, of its rights and obligations under this Agreement


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<P align="left" style="font-size: 10pt">and its Note, and such Assignee shall assume rights and obligations, pursuant
to an Assignment and Acceptance executed by such Assignee and the assigning
Bank, provided that, in each case, after giving effect to such assignment the
Assignee&#146;s Loan Commitment, and, in the case of a partial assignment, the
assigning Bank&#146;s Loan Commitment, each will be equal to or greater than
$5,000,000, provided, further, however, that the assigning Bank shall not be
required to maintain a Loan Commitment in the minimum amount aforesaid in the
event it assigns all of its rights and obligations under this Agreement and its
Note. Notwithstanding the provisions of the immediately preceding sentence,
the consent of Borrower shall not be required in the case of assignments by any
Bank provided that the Assignee thereunder (or a guarantor of such Assignee&#146;s
obligations under this Agreement) has a credit rating of AA (or its equivalent)
or higher from a nationally recognized rating agency. Upon (i)&nbsp;execution and
delivery of such instrument, (ii)&nbsp;payment by such Assignee to the Bank of an
amount equal to the purchase price agreed between the Bank and such Assignee
and (iii)&nbsp;payment by such Assignee to Administrative Agent of a fee, for
Administrative Agent&#146;s own account, in the amount of $3,500, such Assignee
shall be a Bank Party to this Agreement and shall have all the rights and
obligations of a Bank as set forth in such Assignment and Acceptance, and the
assigning Bank shall be released from its obligations hereunder to a
corresponding extent, and no further consent or action by any party shall be
required. Upon the consummation of any assignment pursuant to this paragraph,
substitute Ratable Loan Notes (and, if applicable, Swing Loan Note) shall be
issued to the assigning Bank and Assignee by Borrower, in exchange for the
return of the original Ratable Loan Note (and, if applicable, Swing Loan Note).
The obligations evidenced by such substitute notes shall constitute
&#147;Obligations&#148; for all purposes of this Agreement and the other Loan Documents.
In connection with Borrower&#146;s execution of substitute notes as aforesaid,
Borrower shall deliver to Administrative Agent evidence, satisfactory to
Administrative Agent, of all requisite corporate action to authorize Borrower&#146;s
execution and delivery of the substitute notes and any related documents. If
the Assignee is not incorporated under the Laws of the United States of America
or a state thereof, it shall, prior to the first date on which interest or fees
are payable hereunder for its account, deliver to Borrower and Administrative
Agent certification as to exemption from deduction or withholding of any United
States federal income taxes in accordance with Section&nbsp;10.13. Each Assignee
shall be deemed to have made the representations contained in, and shall be
bound by the provisions of, Section&nbsp;10.13. Notwithstanding the foregoing, any
Designated Lender may assign at any time to its Designating Lender, without the
consents required by or other limitations set forth in the first sentence of
this paragraph, any or all of the Loans it may have funded hereunder and
pursuant to its Designation Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any Bank may at any time assign all or any portion of its rights under
this Agreement and its Note to a Federal Reserve Bank. No such assignment
shall release the transferor Bank from its obligations hereunder.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Borrower recognizes that in connection with a Bank&#146;s selling of
Participations or making of assignments, any or all documentation, financial
statements, appraisals and other data, or copies thereof, relevant to Borrower
or the Loans may be exhibited to and retained by any such Participant or
assignee or prospective Participant or assignee. In connection with a Bank&#146;s
delivery of any financial statements and appraisals to any such Participant or
assignee or prospective Participant or assignee, such Bank shall also indicate
that the same are delivered on a confidential basis. Borrower agrees to
provide all assistance reasonably requested by a Bank to enable such Bank to
sell Participations or make assignments of its Loan as permitted by this
Section. Each Bank agrees


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<P align="left" style="font-size: 10pt">to provide Borrower with notice of all Participations sold by such Bank to
other than its Affiliates. Any Bank or Participant may pledge its Loans or
Participations as collateral in accordance with applicable law.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.06 </B><u><B>Documentation Satisfactory</B></u>. All documentation
required from or to be submitted on behalf of Borrower in connection with this
Agreement and the documents relating hereto shall be subject to the prior
approval of, and be satisfactory in form and substance to, Administrative
Agent, its counsel and, where specifically provided herein, the Banks. In
addition, the persons or parties responsible for the execution and delivery of,
and signatories to, all of such documentation, shall be acceptable to, and
subject to the approval of, Administrative Agent and its counsel and the Banks.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.07 </B><u><B>Notices</B></u>. Unless the party to be notified otherwise
notifies the other party in writing as provided in this Section, and except as
otherwise provided in this Agreement, notices shall be given to Administrative
Agent by telephone, confirmed by writing, and to the Banks and to Borrower by
ordinary mail or overnight courier, receipt confirmed, addressed to such party
at its address on the signature page of this Agreement. Notices shall be
effective (1)&nbsp;if by telephone, at the time of such telephone conversation, (2)
if given by mail, three (3)&nbsp;days after mailing; and (3)&nbsp;if given by overnight
courier, upon receipt.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.08 </B><u><B>Setoff</B></u>. Borrower agrees that, in addition to (and
without limitation of) any right of setoff, bankers&#146; lien or counterclaim a
Bank may otherwise have, each Bank shall be entitled, at its option, to offset
balances (general or special, time or demand, provisional or final) held by it
for the account of Borrower at any of such Bank&#146;s offices, in Dollars or in any
other currency, against any amount payable by Borrower to such Bank under this
Agreement or such Bank&#146;s Note, or any other Loan Document which is not paid
when due (regardless of whether such balances are then due to Borrower), in
which case it shall promptly notify Borrower and Administrative Agent thereof;
provided that such Bank&#146;s failure to give such notice shall not affect the
validity thereof. Payments by Borrower hereunder or under the other Loan
Documents shall be made without setoff or counterclaim.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.09 </B><u><B>Table of Contents; Headings</B></u>. Any table of contents
and the headings and captions hereunder are for convenience only and shall not
affect the interpretation or construction of this Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.10 </B><u><B>Severability</B></u>. The provisions of this Agreement are
intended to be severable. If for any reason any provision of this Agreement
shall be held invalid or unenforceable in whole or in part in any jurisdiction,
such provision shall, as to such jurisdiction, be ineffective to the extent of
such invalidity or unenforceability without in any manner affecting the
validity or enforceability thereof in any other jurisdiction or the remaining
provisions hereof in any jurisdiction.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.11 </B><u><B>Counterparts</B></u>. This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and
the same instrument, and any party hereto may execute this Agreement by signing
any such counterpart.


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<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.12 </B><u><B>Integration</B></u>. The Loan Documents and Supplemental Fee
Letter set forth the entire agreement among the parties hereto relating to the
transactions contemplated thereby and supersede any prior oral or written
statements or agreements with respect to such transactions.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.13 </B><u><B>Governing Law</B></u>. This Agreement shall be governed by,
and construed and enforced in accordance with, the Laws of the State of New
York (without giving effect to New York&#146;s principles of conflicts of Laws).


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.14 </B><u><B>Waivers</B></u>. In connection with the obligations and
liabilities as aforesaid, Borrower hereby waives (1)&nbsp;promptness and diligence;
(2)&nbsp;notice of any actions taken by any Bank Party under this Agreement, any
other Loan Document or any other agreement or instrument relating thereto
except to the extent otherwise provided herein; (3)&nbsp;all other notices, demands
and protests, and all other formalities of every kind in connection with the
enforcement of the Obligations, the omission of or delay in which, but for the
provisions of this Section, might constitute grounds for relieving Borrower of
its obligations hereunder; (4)&nbsp;any requirement that any Bank Party protect,
secure, perfect or insure any Lien on any collateral or exhaust any right or
take any action against Borrower or any other Person or any collateral; (5)&nbsp;any
right or claim of right to cause a marshalling of the assets of Borrower; and
(6)&nbsp;all rights of subrogation or contribution, whether arising by contract or
operation of law (including, without limitation, any such right arising under
the Federal Bankruptcy Code) or otherwise by reason of payment by Borrower,
either jointly or severally, pursuant to this Agreement or other Loan
Documents.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.15 </B><u><B>Jurisdiction; Immunities</B></u>. Borrower, Administrative
Agent and each Bank hereby irrevocably submit to the jurisdiction of any New
York State or United States Federal court sitting in New York City over any
action or proceeding arising out of or relating to this Agreement, the Notes or
any other Loan Document. Borrower, Administrative Agent, and each Bank
irrevocably agree that all claims in respect of such action or proceeding may
be heard and determined in such New York State or United States Federal court.
Borrower, Administrative Agent, and each Bank irrevocably consent to the
service of any and all process in any such action or proceeding by the mailing
of copies of such process to Borrower, Administrative Agent or each Bank, as
the case may be, at the addresses specified herein. Borrower, Administrative
Agent and each Bank agree that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by Law. Borrower,
Administrative Agent and each Bank further waive any objection to venue in the
State of New York and any objection to an action or proceeding in the State of
New York on the basis of forum non conveniens. Borrower, Administrative Agent
and each Bank agree that any action or proceeding brought against Borrower,
Administrative Agent or any Bank, as the case may be, shall be brought only in
a New York State court sitting in New York City or a United States Federal
court sitting in New York City, to the extent permitted or not expressly
prohibited by applicable Law.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nothing in this Section shall affect the right of Borrower, Administrative
Agent or any Bank to serve legal process in any other manner permitted by Law.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To the extent that Borrower, Administrative Agent or any Bank have or
hereafter may acquire any immunity from jurisdiction of any court or from any
legal process (whether from service or notice, attachment prior to judgment,
attachment in aid of execution, execution or


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<P align="left" style="font-size: 10pt">otherwise) with respect to itself or its property, Borrower, Administrative
Agent and each Bank hereby irrevocably waive such immunity in respect of its
obligations under this Agreement, the Notes and any other Loan Document.
BORROWER, ADMINISTRATIVE AGENT AND EACH BANK WAIVE ANY RIGHT EACH SUCH PARTY
MAY HAVE TO JURY TRIAL IN CONNECTION WITH ANY SUIT, ACTION OR PROCEEDING
BROUGHT WITH RESPECT TO THIS AGREEMENT, THE NOTES OR THE LOANS.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.16 </B><u><B>Designated Lender</B></u>. Any Bank (other than a Bank who
is such solely because it is a Designated Lender) (each, a &#147;<B><I>Designating
Lender</I></B>&#148;) may at any time designate one (1)&nbsp;Designated Lender to fund Bid Rate
Loans on behalf of such Designating Lender subject to the terms of this Section
and the provisions in Section&nbsp;12.05 shall not apply to such designation. No
Bank may designate more than one (1)&nbsp;Designated Lender. The parties to each
such designation shall execute and deliver to Administrative Agent for its
acceptance a Designation Agreement. Upon such receipt of an appropriately
completed Designation Agreement executed by a Designating Lender and a designee
representing that it is a Designated Lender, Administrative Agent will accept
such Designation Agreement and give prompt notice thereto to Borrower,
whereupon, (i)&nbsp;from and after the &#147;Effective Date&#148; specified in the Designation
Agreement, the Designated Lender shall become a party to this Agreement with a
right to make Bid Rate Loans on behalf of its Designating Lender pursuant to
Section&nbsp;2.02 after Borrower has accepted the Bid Rate Quote of the Designating
Lender and (ii)&nbsp;the Designated Lender shall not be required to make payments
with respect to any obligations in this Agreement except to the extent of
excess cash flow of such Designated Lender which is not otherwise required to
repay obligations of such Designated Lender which are then due and payable;
provided, however, that regardless of such designation and assumption by the
Designated Lender, the Designating Lender shall be and remain obligated to
Borrower, Administrative Agent and the Banks for each and every of the
obligations of the Designating Lender and its related Designated Lender with
respect to this Agreement, including, without limitation, any indemnification
obligations under Section&nbsp;10.05. Each Designating Lender shall serve as the
administrative agent of its Designated Lender and shall on behalf of, and to
the exclusion of, the Designated Lender: (i)&nbsp;receive any and all payments made
for the benefit of the Designated Lender and (ii)&nbsp;give and receive all
communications and notices and take all actions hereunder, including, without
limitation, votes, approvals, waivers and consents under or relating to this
Agreement and the other Loan Documents. Any such notice, communication, vote,
approval, waiver or consent shall be signed by the Designating Lender as
administrative agent for the Designated Lender and shall not be signed by the
Designated Lender on its own behalf, but shall be binding on the Designated
Lender to the same extent as if actually signed by the Designated Lender.
Borrower, Administrative Agent and the Banks may rely thereon without any
requirement that the Designated Lender sign or acknowledge the same. No
Designated Lender may assign or transfer all or any portion of its interest
hereunder or under any other Loan Document, other than assignments to the
Designating Lender which originally designated such Designated Lender.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.17 </B><u><B>No Bankruptcy Proceedings</B></u>. Each of Borrower, the
Banks and Administrative Agent hereby agrees that it will not institute against
any Designated Lender or join any other Person in instituting against any
Designated Lender any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceeding under any federal or state bankruptcy or similar Law,
for one (1)&nbsp;year and one (1)&nbsp;day after the payment in full of the latest
maturing commercial paper note issued by such Designated Lender.


<P align="center" style="font-size: 10pt">-62-
</DIV>

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<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.18 </B><u><B>USA Patriot Act</B></u>. Each Bank hereby notifies Borrower
that pursuant to the requirements of the USA Patriot Act (Title III of
Pub.L.107-56 (signed into law October&nbsp;26, 2001)) (the &#147;<B><I>Act</I></B>&#148;), it is required to
obtain, verify and record information that identifies Borrower, which
information includes the name and address of Borrower and other information
that will allow such Bank to identify Borrower in accordance with the Act.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Section&nbsp;12.19 </B><u><B>Transitional Arrangements</B></u>.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;2001 Credit Agreement Superseded. This Agreement shall supersede the
2001 Credit Agreement in its entirety, except as provided in this Section
12.19. On the Closing Date, the rights and obligations of the parties under
the 2001 Credit Agreement and the &#147;Notes&#148; defined therein shall be subsumed
within and be governed by this Agreement and the Notes; <I>provided however</I>, that
any of the &#147;Obligations&#148; (as defined in the 2001 Credit Agreement) outstanding
under the 2001 Credit Agreement shall, for purposes of this Agreement, be
Obligations hereunder. The Banks&#146; interests in such Obligations, and
participations in such Letters of Credit shall be reallocated on the Closing
Date in accordance with each Bank&#146;s applicable Pro Rata Share.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;Return and Cancellation of Notes. Upon its receipt of the Notes to be
delivered hereunder on the Closing Date, each Bank will promptly return to
Borrower, marked &#147;Cancelled&#148; or &#147;Replaced&#148;, the notes of Borrower held by such
Bank pursuant to the 2001 Credit Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;Interest and Fees Under Original Agreement. All interest and all
commitment, facility and other fees and expenses owing or accruing under or in
respect of the 2001 Credit Agreement shall be calculated as of the Closing Date
(prorated in the case of any fractional periods), and shall be paid on the
Closing Date in accordance with the method specified in the 2001 Credit
Agreement as if such agreement were still in effect.


<P align="center" style="font-size: 10pt">-63-
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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.


<P align="left" style="font-size: 10pt; margin-left: 50%">AVALONBAY COMMUNITIES, INC.


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u>/s/ Joanne M. Lockridge </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Joanne M. Lockridge<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Senior Vice President - Finance


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices:


<P align="left" style="font-size: 10pt; margin-left: 50%">220 Elm Street<BR>
Suite&nbsp;200<BR>
New Canaan, CT 06840


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: Joanne M. Lockridge


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (203)&nbsp;801-3331<BR>
Telecopy: (203)&nbsp;801-3335


<P align="left" style="font-size: 10pt; margin-left: 50%">Address of principal place of business:


<P align="left" style="font-size: 10pt; margin-left: 50%">2900 Eisenhower Ave.<BR>
Suite&nbsp;300<BR>
Alexandria, VA 22314


<P align="left" style="font-size: 10pt; margin-left: 50%">Taxpayer Identification Number: 77-0404318


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt; margin-left: 50%">FLEET NATIONAL BANK (as Bank and<BR>
Administrative Agent)


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u>/s/ Lisa Sanders </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Lisa Sanders<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Senior Vice President


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">Fleet National Bank<BR>
One Landmark Square<BR>
Stamford, CT 06904


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: Lisa Sanders


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (203)&nbsp;973-1984<BR>
Telecopy: (301)&nbsp;438-7696


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt; margin-left: 50%">JPMORGAN CHASE BANK (as Bank<BR>
and Syndication Agent)


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u>/s/ Marc E. Costantino </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Marc E. Costantino<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Vice President


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">JPMorgan Chase Bank<BR>
270 Park Avenue, 4<sup>th</sup> Floor<BR>
New York, NY 10017


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: Marc Costantino


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (212)&nbsp;270-9554<BR>
Telecopy: (212)&nbsp;270-0213


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt; margin-left: 50%">WACHOVIA BANK, NATIONAL<BR>
ASSOCIATION (as Bank and<BR>
Syndication Agent)


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u> /s/ David Hoagland </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: David Hoagland<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Director


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">Wachovia Bank, National Association<BR>
301 South College Street<BR>
Charlotte NC 28288-0172


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: David Hoagland


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (704)&nbsp;374-4809<BR>
Telecopy: (704)&nbsp;383-6205


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt; margin-left: 50%">DEUTSCHE BANK TRUST COMPANY<BR>
AMERICAS (as Bank and<BR>
Documentation Agent)


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u> /s/ Linda Wang </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Linda Wang<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Vice President


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">Deutsche Bank Trust Company Americas<BR>
60 Wall Street, 10<sup>th</sup> Floor<BR>
New York, NY 10005


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: Linda Wang


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (212)&nbsp;250-2368<BR>
Telecopy: (212)&nbsp;797-4496


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt; margin-left: 50%">MORGAN STANLEY BANK (as Bank<BR>
and Documentation Agent)


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u> /s/ Daniel Twenge </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Daniel Twenge<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Vice President


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">Morgan Stanley Bank<BR>
1585 Broadway, 2<sup>nd</sup> Floor<BR>
New York, NY 10036


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: Elizabeth Frattaroli


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (212)&nbsp;761-1285<BR>
Telecopy: (212)&nbsp;507-3505


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt; margin-left: 50%">WELLS FARGO BANK, NATIONAL<BR>
ASSOCIATION (as Bank and<BR>
Documentation Agent)


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u> /s/ Stephen Gray </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Stephen Gray<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Assistant Vice President


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">Wells Fargo Bank, National Association<BR>
1750 H Street, N.W., Suite&nbsp;400<BR>
Washington, DC 20006


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: Stephen Gray


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (202)&nbsp;303-3010<BR>
Telecopy: (202)&nbsp;429-2984


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<P align="left" style="font-size: 10pt; margin-left: 50%">SOUTHTRUST BANK


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u> /s/ Renald Ferrovecchio </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Renald Ferrovecchio<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Vice President


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">SouthTrust Bank<BR>
171 17<sup>th</sup> Street, 6<sup>th</sup> Floor<BR>
Atlanta, GA 30363


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: Renald Ferrovecchio


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (404)&nbsp;214-5913<BR>
Telecopy: (404)&nbsp;214-3728


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<P align="left" style="font-size: 10pt; margin-left: 50%">SUNTRUST BANK


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u> /s/ Nancy B. Richards </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Nancy B. Richards<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Vice President


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">SunTrust Bank<BR>
8245 Boone Blvd., Suite&nbsp;820<BR>
Vienna, VA 22182


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: Nancy B. Richards


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (703)&nbsp;902-9039<BR>
Telecopy: (703)&nbsp;902-9245


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="45%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="50%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="left" nowrap valign="top"><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
UBS LOAN FINANCE LLC</TD>
</TR>

<TR valign="bottom" style="padding-top: 1em">
    <TD align="left" nowrap valign="top">By: <u>  /s/ Joselin Fernandes </u></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
By: <u>  /s/ Doris Mesa </u></TD>
</TR>

<TR valign="bottom" style="padding-top: 0em">
    <TD align="left" nowrap valign="top">
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name:  Joselin Fernandes<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title:  Associate Director<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Banking Products Services, US</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name:  Doris Mesa<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title:  Associate Director<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Banking Products Services, US</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="padding-top: 1em">
    <TD align="center" nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
Address for Notices and<BR>
Applicable Lending Office:</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="padding-top: 1em">
    <TD align="center" nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
UBS Loan Finance, LLC<BR>
677 Washington Boulevard<BR>
Stamford, CT 06901</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="padding-top: 1em">
    <TD align="center" nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
Attention: Christopher Aitkin</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="padding-top: 1em">
    <TD align="center" nowrap valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
Telephone: (203) 719-3845<BR>
Telecopy: (203) 719-3888</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>



<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">


<P align="left" style="font-size: 10pt; margin-left: 50%">AMSOUTH BANK


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u> /s/ Robert W. Blair </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Robert W. Blair<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Vice President


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">AmSouth Bank<BR>
1900 5<sup>th</sup> Avenue N.<BR>
Birmingham, AL 35203


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: Robert Blair


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (205)&nbsp;326-4071<BR>
Telecopy: (205)&nbsp;326-4075


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt; margin-left: 50%">BANK OF CHINA, NEW YORK<BR>
BRANCH


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u>/s/ Bailin Zheng </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Bailin Zheng<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: General Manager


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">Bank of China, New York Branch<BR>
410 Madison Avenue<BR>
New York, NY 10017


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: David Hoang


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (212)&nbsp;935-3101 ext. 229<BR>
Telecopy: (212)&nbsp;308-4993


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt; margin-left: 50%">THE BANK OF NEW YORK


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u> /s/ Anthony A. Filorimo </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Anthony A. Filorimo<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Vice President


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">The Bank of New York<BR>
One Wall Street<BR>
New York, NY 10286


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: Anthony Filorimo


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (212)&nbsp;635-7519<BR>
Telecopy: (212)&nbsp;809-9526


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt; margin-left: 50%">KEYBANK NATIONAL<BR>
ASSOCIATION


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u> /s/ Jennifer A. Dakin </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Jennifer A. Dakin<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: AVP


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">KeyBank, N.A.<BR>
1146 19<sup>th</sup> Street, N.W., Ste. 400<BR>
Washington, DC 20036


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: John Scott


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (202)&nbsp;452-4941<BR>
Telecopy: (202)&nbsp;452-4925


<P align="left" style="font-size: 10pt; margin-left: 50%">With a copy to:


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: Jennifer Dakin


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (202)&nbsp;452-4940<BR>
Telecopy: (202)&nbsp;452-4925


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt; margin-left: 50%">PNC BANK, NATIONAL<BR>
ASSOCIATION


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u> /s/ William R. Lynch, III </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: William R. Lynch, III<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Senior Vice President


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">PNC Bank, National Association<BR>
One PNC Plaza<BR>
249 Fifth Avenue<BR>
P1-POPP-19-2<BR>
Pittsburgh, PA 15222


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: Real Estate Banking


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (412)&nbsp;762-8519<BR>
Telecopy: (412)&nbsp;768-3930


<P align="left" style="font-size: 10pt; margin-left: 50%">with a copy to:


<P align="left" style="font-size: 10pt; margin-left: 50%">7200 Wisconsin Avenue, Suite&nbsp;314<BR>
Bethesda, MD 20814


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: William Lynch


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (301)&nbsp;986-5268<BR>
Telecopy: (301)&nbsp;986-5279


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt; margin-left: 50%">SCOTIABANC INC.


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u> /s/ William E. Zarrett </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: William E. Zarrett<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Managing Director


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">Scotiabanc Inc.<BR>
600 Peachtree St. N.E., Suite&nbsp;2700<BR>
Atlanta, GA 30308


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: William. E. Zarrett


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (404)&nbsp;877-1504<BR>
Telecopy: (404)&nbsp;888-8995


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt; margin-left: 50%">CHANG HWA COMMERCIAL BANK,<BR>
LTD., NEW YORK BRANCH


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u> /s/ Ming-Hsien Lin </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Ming-Hsien Lin<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: SVP &#038; General Manager


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">Chang Hwa Commercial Bank, Ltd.,<BR>
New York Branch<BR>
685 Third Avenue, 29<sup>th</sup> Floor<BR>
New York, NY 10017


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: Danielle Tsai


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (212)&nbsp;651-9770 ext. 29<BR>
Telecopy: (212)&nbsp;651-9785


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt; margin-left: 50%">COMERICA BANK


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u> /s/ Jessica L. Kempf </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Jessica L. Kempf<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Assistant Vice President


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">Overnight Mail:<BR>
Comerica Bank<BR>
500 Woodward Ave., 7<sup>th</sup> Floor<BR>
Detroit, MI 48226-3256


<P align="left" style="font-size: 10pt; margin-left: 50%">U.S. Mail:<BR>
Comerica Bank<BR>
P.O. Box 75000<BR>
Detroit, MI 48275-3256


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: Casey L. Ostrander


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (313)&nbsp;222-5286<BR>
Telecopy: (313)&nbsp;222-9295


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt; margin-left: 50%">FIRST HORIZON BANK, a division of<BR>
First Tennessee Bank N.A.


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u> /s/ J. Jordan O&#146;Neill, III </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: J. Jordan O&#146;Neill, III<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Senior Vice President


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">First Horizon Bank, a division of<BR>
First Tennessee Bank N.A.<BR>
1650 Tysons Boulevard, Suite&nbsp;1150<BR>
McLean, VA 22102


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: J. Jordan O&#146;Neill, III


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (703)&nbsp;394-2518<BR>
Telecopy: (703)&nbsp;734-1834


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt; margin-left: 50%">US BANK NATIONAL ASSOCIATION


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u> /s/ Sherry Reynolds </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Sherry Reynolds<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Vice President


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">US Bank National Association<BR>
800 Nicollet Mall, 3<sup>rd</sup> Floor<BR>
Minneapolis, MN 55402-7020


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: Michael Raarup


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (612)&nbsp;303-3586<BR>
Telecopy: (612)&nbsp;303-2270


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt; margin-left: 50%">E.SUN COMMERCIAL BANK, LTD.,<BR>
LOS ANGELES BRANCH


<P align="left" style="font-size: 10pt; margin-left: 50%">By: <u> /s/ Peter Shih </u><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name: Peter Shih<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title: Chief Financial Officer


<P align="left" style="font-size: 10pt; margin-left: 50%">Address for Notices and<BR>
Applicable Lending Office:


<P align="left" style="font-size: 10pt; margin-left: 50%">E.Sun Commercial Bank, Ltd.,<BR>
Los Angeles Branch<BR>
17700 Castleton Street, Suite&nbsp;500<BR>
City of Industry, CA 91748


<P align="left" style="font-size: 10pt; margin-left: 50%">Attention: Homer Hou


<P align="left" style="font-size: 10pt; margin-left: 50%">Telephone: (626)&nbsp;810-2400 ext. 225<BR>
Telecopy: (626)&nbsp;839-5531



<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="center" style="font-size: 10pt"><B>EXHIBITS</B>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="65%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="16%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="78%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">EXHIBIT A
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">-
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Authorization Letter</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">EXHIBIT B
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">-
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Ratable Loan Note</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">EXHIBIT B-1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">-
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Bid Rate Loan Note</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">EXHIBIT B-2
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">-
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Swing Loan Note</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">EXHIBIT C
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">-
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Information Regarding Material Affiliates</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">EXHIBIT D
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">-
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Solvency Certificate</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">EXHIBIT E
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">-
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Assignment and Acceptance</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">EXHIBIT F
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">-
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Designation Agreement</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">EXHIBIT G-1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">-
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Bid Rate Quote Request</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">EXHIBIT G-2
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">-
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Invitation for Bid Rate Quotes</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top" nowrap><DIV style="margin-left:0px; text-indent:-0px">EXHIBIT G-3
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">-
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Bid Rate Quote</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">EXHIBIT G-4
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">-
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Borrower&#146;s Acceptance of Bid Rate Quote</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">EXHIBIT H
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">-
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Acceptance Letter</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD colspan="5" align="center" valign="top"><B>SCHEDULES</B></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top" nowrap><DIV style="margin-left:0px; text-indent:-0px">SCHEDULE 1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">-
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Loan Commitments</TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>



<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="center" style="font-size: 10pt"><B>EXHIBIT A</B>


<P align="center" style="font-size: 10pt"><B>AUTHORIZATION LETTER</B>


<P align="center" style="font-size: 10pt"><B>________ ___, 2004</B>


<P align="left" style="font-size: 10pt">Fleet National Bank


<P align="left" style="font-size: 10pt"><HR size="1" noshade width="30%" align="LEFT"><BR>
<HR size="1" noshade width="30%" align="LEFT"><BR>
<HR size="1" noshade width="30%" align="LEFT">


<P>
<TABLE width="100%" border="0" cellpadding="2" cellspacing="0" style="font-size: 10pt; background: transparent; color: #000000">
<TR>
    <TD width="5%"></TD>
    <TD width="95%"></TD>
</TR>
<TR valign="top">
    <TD nowrap align="right">Re:&nbsp;</TD>
    <TD>Amended and Restated Revolving Loan Agreement dated as of May
______, 2004 (the &#147;<B><I>Loan Agreement</I></B>&#148;; capitalized terms not otherwise
defined herein shall have the meanings ascribed to such terms in the
Loan Agreement) among us, as Borrower, the Banks named therein, and
you, as Administrative Agent for said Banks</TD>
</TR>
</TABLE>


<P align="left" style="font-size: 10pt">Ladies/Gentlemen:


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In connection with the captioned Loan Agreement, we hereby designate any
of the following persons to give to you instructions, including notices
required pursuant to the Loan Agreement, orally, by telephone or teleprocess,
or in writing:


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#091;NAMES&#093;


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Instructions may be honored on the oral, telephonic, teleprocess or
written instructions of anyone purporting to be any one of the above designated
persons even if the instructions are for the benefit of the person delivering
them. We will furnish you with written confirmation of each such instruction
signed by any person designated above (including any telecopy which appears to
bear the signature of any person designated above) on the same day that the
instruction is provided to you, but your responsibility with respect to any
instruction shall not be affected by your failure to receive such confirmation
or by its contents.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Without limiting the foregoing, we hereby unconditionally authorize any
one of the above-designated persons to execute and submit requests for advances
of proceeds of the Loans (including the Initial Advance) and notices of
Elections, Conversions and Continuations to you under the Loan Agreement with
the identical force and effect in all respects as if executed and submitted by
us.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You and the Banks shall be fully protected in, and shall incur no
liability to us for, acting upon any instructions which you in good faith
believe to have been given by any person designated above, and in no event
shall you or the Banks be liable for special, consequential or punitive
damages. In addition, we agree to hold you and the Banks and your and their
respective agents harmless from any and all liability, loss and expense arising
directly or indirectly out of instructions that we provide to you in connection
with the Loan Agreement except for liability, loss or expense occasioned by
your gross negligence or willful misconduct.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon notice to us, you may, at your option, refuse to execute any
instruction, or part thereof, without incurring any responsibility for any
loss, liability or expense arising out of such


<P align="center" style="font-size: 10pt">A-1
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt">refusal if you in good faith believe that the person delivering the
instruction is not one of the persons designated above or if the instruction is
not accompanied by an authentication method that we have agreed to in writing.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We will promptly notify you in writing of any change in the persons
designated above and, until you have actually received such written notice and
have had a reasonable opportunity to act upon it, you are authorized to act
upon instructions, even though the person delivering them may no longer be
authorized.


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">Very truly yours, <BR>
<BR>
AVALONBAY COMMUNITIES, INC.<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt">A-2
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt"><B>EXHIBIT B</B>


<P align="center" style="font-size: 10pt"><B>RATABLE LOAN NOTE</B>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="47%"></TD>
    <TD width="5%"></TD>
    <TD width="47%"></TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="left" valign="top">$__________
</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">New York, New York<br>
______________, 200_</TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For value received, AvalonBay Communities, Inc., a Maryland corporation
(&#147;<B><I>Borrower</I></B>&#148;), hereby promises to pay to the
order of &#95;&#95;&#95;&#95;&#95;&#95;&#95; or its
successors or assigns (collectively, the &#147;<B><I>Bank</I></B>&#148;), at the principal office of
Fleet National Bank (&#147;<B><I>Administrative Agent</I></B>&#148;)
located at &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95; for
the account of the Applicable Lending Office of the Bank, the principal sum of
&#95;&#95;&#95;&#95;&#95;&#95; Dollars ($&#95;&#95;&#95;&#95;&#95;), or if less, the amount loaned by the Bank
under its Ratable Loan to Borrower pursuant to the Loan Agreement (as defined
below) and actually outstanding, in lawful money of the United States and in
immediately available funds, in accordance with the terms set forth in the Loan
Agreement. Borrower also promises to pay interest on the unpaid principal
balance hereof, for the period such balance is outstanding, in like money, at
said office for the account of said Applicable Lending Office, at the time and
at a rate per annum as provided in the Loan Agreement. Any amount of principal
hereof which is not paid when due, whether at stated maturity, by acceleration,
or otherwise, shall bear interest from the date when due until said principal
amount is paid in full, payable on demand, at the rate set forth in the Loan
Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The date and amount of each advance of the Ratable Loan made by the Bank
to Borrower under the Loan Agreement referred to below, and each payment of
said Ratable Loan, shall be recorded by the Bank on its books and, prior to any
transfer of this Note (or, at the discretion of the Bank, at any other time),
may be endorsed by the Bank on the schedule attached hereto and any
continuation thereof.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Note is one of the Ratable Loan Notes referred to in the Amended and
Restated Revolving Loan Agreement dated as of May&nbsp;24, 2004 (as the same may be
amended from time to time, the &#147;<B><I>Loan Agreement</I></B>&#148;) among Borrower, the Banks
named therein (including the Bank) and Administrative Agent, as administrative
agent for the Banks. All of the terms, conditions and provisions of the Loan
Agreement are hereby incorporated by reference. All capitalized terms used
herein and not defined herein shall have the meanings given to them in the Loan
Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Loan Agreement contains, among other things, provisions for the
prepayment of and acceleration of this Note upon the happening of certain
stated events.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No recourse shall be had under this Note against Borrower&#146;s Principals
except as and to the extent set forth in Section&nbsp;11.02 of the Loan Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All parties to this Note, whether principal, surety, guarantor or
endorser, hereby waive presentment for payment, demand, protest, notice of
protest and notice of dishonor. This Note shall be governed by, and construed
and enforced in accordance with, the Laws of the State of New York, provided
that, as to the maximum lawful rate of interest which may be charged or
collected,


<P align="center" style="font-size: 10pt">B-1
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<P align="left" style="font-size: 10pt">if the Laws applicable to the Bank permit it to charge or collect a higher
rate than the Laws of the State of New York, then such Law applicable to the
Bank shall apply to the Bank under this Note.


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">AVALONBAY COMMUNITIES, INC.<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt">B-2
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
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    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>

</TABLE>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="90%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="1%">&nbsp;</TD>
    <TD width="22%">&nbsp;</TD>
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    <TD width="2%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
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    <TD width="2%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
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    <TD width="7%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
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    <TD width="2%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>

    <TD width="1%">&nbsp;</TD>
</TR><TR style="font-size: 1px" valign="bottom">
    <TD nowrap align="left" colspan="23" style="border-bottom: 2px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">    <TD width="1%" style="border-left: 2px solid #000000">&nbsp;</TD>

    <TD align="center">Date</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Amount of</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Amount of</TD>
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    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Balance of</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
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    <TD width="1%" style="border-right: 2px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">    <TD width="1%" style="border-left: 2px solid #000000">&nbsp;</TD>

    <TD>&nbsp;</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Loan</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Principal Paid or</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Principal</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">By:</TD>
    <TD width="1%" style="border-right: 2px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">    <TD width="1%" style="border-left: 2px solid #000000">&nbsp;</TD>

    <TD nowrap align="center">&nbsp;</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Prepaid</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Unpaid</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000">&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">

<TD width="1%" style="border-left: 2px solid #000000; border-top: 2px solid #000000">&nbsp;</TD>
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</TR>

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</TR>

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    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
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    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
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    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
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    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
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    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
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    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
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    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
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    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
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    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
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    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR style="font-size: 1px" valign="bottom">
    <TD nowrap align="left" colspan="23" style="border-top: 2px solid #000000">&nbsp;</TD>
</TR>


<!-- End Table Body --></TABLE>
</DIV>



<P align="center" style="font-size: 10pt">B-3
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="center" style="font-size: 10pt"><B>EXHIBIT B-1</B>


<P align="center" style="font-size: 10pt"><B>BID RATE LOAN NOTE</B>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="47%"></TD>
    <TD width="5%"></TD>
    <TD width="47%"></TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="left" valign="top">$250,000,000
</TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">New York, New York<BR>
&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;, 2004</TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For value received, AvalonBay Communities, Inc., a Maryland corporation
(&#147;<B><I>Borrower</I></B>&#148;), hereby promises to pay to the order of Fleet National Bank
(&#147;<B><I>Administrative Agent</I></B>&#148;) or its successors or assigns for the account of the
respective Banks making Bid Rate Loans or their respective successors or
assigns (for the further account of their respective Applicable Lending
Offices), at the principal office of Administrative Agent located at
&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;, the principal sum of Two
Hundred Fifty Million Dollars ($250,000,000), or if less, the amount loaned by
one or more of said Banks under their respective Bid Rate Loans to Borrower
pursuant to the Loan Agreement (as defined below) and actually outstanding, in
lawful money of the United States and in immediately available funds, in
accordance with the terms set forth in the Loan Agreement. Borrower also
promises to pay interest on the unpaid principal balance hereof, for the period
such balance is outstanding, in like money, at said office for the account of
said Banks for the further account of their respective Applicable Lending
Offices, at the times and at the rates per annum as provided in the Loan
Agreement. Any amount of principal hereof which is not paid when due, whether
at stated maturity, by acceleration, or otherwise, shall bear interest from the
date when due until said principal amount is paid in full, payable on demand,
at the rate set forth in the Loan Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The date and amount of each Bid Rate Loan to Borrower under the Loan
Agreement referred to below, the name of the Bank making the same, the interest
rate applicable thereto and the maturity date thereof (i.e., the end of the
Interest Period Applicable thereto) shall be recorded by Administrative Agent
on its records and may be endorsed by Administrative Agent on the schedule
attached hereto and any continuation thereof.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Note is the Bid Rate Loan Note referred to in the Amended and
Restated Revolving Loan Agreement dated as of May&nbsp;24, 2004 (as the same may be
amended from time to time, the &#147;<B><I>Loan Agreement</I></B>&#148;) among Borrower, the Banks
named therein and Administrative Agent, as administrative agent for the Banks.
All of the terms, conditions and provisions of the Loan Agreement are hereby
incorporated by reference. All capitalized terms used herein and not defined
herein shall have the meanings given to them in the Loan Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Loan Agreement contains, among other things, provisions for the
prepayment of and acceleration of this Note upon the happening of certain
stated events.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No recourse shall be had under this Note against the Borrower&#146;s Principals
except as and to the extent set forth in Section&nbsp;11.02 of the Loan Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All parties to this Note, whether principal, surety, guarantor or
endorser, hereby waive presentment for payment, demand, protest, notice of
protest and notice of dishonor.


<P align="center" style="font-size: 10pt">B-1-1
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Note shall be governed by, and construed and enforced in accordance
with, the Laws of the State of New York, provided that, as to the maximum
lawful rate of interest which may be charged or collected, if the Laws
applicable to a particular Bank permit it to charge or collect a higher rate
than the Laws of the State of New York, then such Law applicable to such Bank
shall apply to such Bank under this Note.


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">AVALONBAY COMMUNITIES, INC.<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt">B-1-2
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>

</TABLE>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="90%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="1%">&nbsp;</TD>
    <TD width="18%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="6%">&nbsp;</TD>

    <TD width="1%">&nbsp;</TD>
</TR><TR style="font-size: 1px" valign="bottom">
    <TD nowrap align="left" colspan="28" style="border-bottom: 2px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">    <TD width="1%" style="border-left: 2px solid #000000">&nbsp;</TD>

    <TD nowrap align="center">Bid Rate</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Date</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>

    <TD nowrap align="center" colspan="3">Amount of Bid</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Interest Rate</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Expiration of</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Notation Made</TD>
    <TD width="1%" style="border-right: 2px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">    <TD width="1%" style="border-left: 2px solid #000000">&nbsp;</TD>

    <TD nowrap align="center">Loan</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Rate Loan</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Interest Period</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">By:</TD>
    <TD width="1%" style="border-right: 2px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">    <TD width="1%" style="border-left: 2px solid #000000">&nbsp;</TD>

    <TD nowrap align="center">Number</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
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    <TD nowrap align="left" colspan="28" style="border-top: 2px solid #000000">&nbsp;</TD>
</TR>


<!-- End Table Body --></TABLE>
</DIV>



<P align="center" style="font-size: 10pt">B-1-3
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="center" style="font-size: 10pt"><B>EXHIBIT B-2</B>


<P align="center" style="font-size: 10pt"><B>SWING LOAN NOTE</B>


<P align="right" style="font-size: 10pt">New York, New York<br>
__________, 200_


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For value received, AvalonBay Communities, Inc., a Maryland corporation
(&#147;<B><I>Borrower</I></B>&#148;), hereby promises to pay to the
order of &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95; or its
successors or assigns (collectively, the &#147;<B><I>Bank</I></B>&#148;), at the principal office of
Fleet National Bank (&#147;<B><I>Administrative Agent</I></B>&#148;) located at &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95; for
the account of the Applicable Lending Office of the Bank, the principal sum
equal to the amount loaned by the Bank under its Swing Loan to Borrower
pursuant to the Loan Agreement (as defined below) and actually outstanding, in
lawful money of the United States and in immediately available funds, in
accordance with the terms set forth in the Loan Agreement. Borrower also
promises to pay interest on the unpaid principal balance hereof, for the period
such balance is outstanding, in like money, at said office for the account of
said Applicable Lending Office, at the time and at a rate per annum as provided
in the Loan Agreement. Any amount of principal hereof which is not paid when
due, whether at stated maturity, by acceleration, or otherwise, shall bear
interest from the date when due until said principal amount is paid in full,
payable on demand, at the rate set forth in the Loan Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The date and amount of each advance of the Swing Loan made by the Bank to
Borrower under the Loan Agreement referred to below, and each payment of said
Swing Loan, shall be recorded by the Bank on its books and, prior to any
transfer of this Note (or, at the discretion of the Bank, at any other time),
may be endorsed by the Bank on the schedule attached hereto and any
continuation thereof.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Note is one of the Swing Loan Notes referred to in the Amended and
Restated Revolving Loan Agreement dated as of May&nbsp;24, 2004 (as the same may be
amended from time to time, the &#147;<B><I>Loan Agreement</I></B>&#148;) among Borrower, the Banks
named therein (including the Bank) and Administrative Agent, as administrative
agent for the Banks. All of the terms, conditions and provisions of the Loan
Agreement are hereby incorporated by reference. All capitalized terms used
herein and not defined herein shall have the meanings given to them in the Loan
Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Loan Agreement contains, among other things, provisions for the
prepayment of and acceleration of this Note upon the happening of certain
stated events.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No recourse shall be had under this Note against Borrower&#146;s Principals
except as and to the extent set forth in Section&nbsp;11.02 of the Loan Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All parties to this Note, whether principal, surety, guarantor or
endorser, hereby waive presentment for payment, demand, protest, notice of
protest and notice of dishonor.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Note shall be governed by, and construed and enforced in accordance
with, the Laws of the State of New York, provided that, as to the maximum
lawful rate of interest which may be charged or collected, if the Laws
applicable to the Bank permit it to charge or collect a higher rate than the
Laws of the State of New York, then such Law applicable to the Bank shall apply
to the Bank under this Note.


<P align="center" style="font-size: 10pt">B-2-1
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">AVALONBAY COMMUNITIES, INC.<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt">B-2-2
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>

</TABLE>
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="90%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="1%">&nbsp;</TD>
    <TD width="22%">&nbsp;</TD>
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    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>

    <TD width="1%">&nbsp;</TD>
</TR><TR style="font-size: 1px" valign="bottom">
    <TD nowrap align="left" colspan="23" style="border-bottom: 2px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">    <TD width="1%" style="border-left: 2px solid #000000">&nbsp;</TD>

    <TD>&nbsp;</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Amount of</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Balance of</TD>
    <TD style="border-right: 0px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">    <TD width="1%" style="border-left: 2px solid #000000">&nbsp;</TD>

    <TD>&nbsp;</TD>
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    <TD>&nbsp;</TD>
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    <TD>&nbsp;</TD>
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<TR valign="bottom" style="background: #eeeeee">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR style="font-size: 1px" valign="bottom">
    <TD nowrap align="left" colspan="23" style="border-top: 2px solid #000000">&nbsp;</TD>
</TR>


<!-- End Table Body --></TABLE>
</DIV>



<P align="center" style="font-size: 10pt">B-2-3
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="center" style="font-size: 10pt"><B><U>EXHIBIT C</U></B>


<P align="center" style="font-size: 10pt"><B>INFORMATION REGARDING MATERIAL AFFILIATES</B>


<P align="center" style="font-size: 10pt"><B>&#091;Omitted &#151;
Lists all AvalonBay subsidiaries without regard to size or materiality&#093;</B>


<P align="center" style="font-size: 10pt">C-1
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="center" style="font-size: 10pt"><B><U>EXHIBIT D</U></B>


<P align="center" style="font-size: 10pt"><B>SOLVENCY CERTIFICATE</B>


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The person executing this certificate is the &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95; of
AvalonBay Communities, Inc., a Maryland corporation (&#147;<B><I>Borrower</I></B>&#148;), and is
familiar with its properties, assets and businesses, and is duly authorized to
execute this certificate on behalf of Borrower pursuant to Section&nbsp;4.01(7) of
the Amended and Restated Revolving Loan Agreement dated the date hereof (the
&#147;<B><I>Loan Agreement</I></B>&#148;) among Borrower, the banks party thereto (each a &#147;<B><I>Bank</I></B>&#148; and
collectively, the &#147;<B><I>Banks</I></B>&#148;) and Fleet National Bank, as administrative agent for
the Banks (in such capacity, together with its successors in such capacity,
&#147;<B><I>Administrative Agent</I></B>&#148;). In executing this Certificate, such person is acting
solely in his or her capacity as the &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95; of Borrower, and not in
his or her individual capacity. Unless otherwise defined herein, terms defined
in the Loan Agreement are used herein as therein defined.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The undersigned further certifies that he or she has carefully reviewed
the Loan Agreement and the other Loan Documents and the contents of this
Certificate and, in connection herewith, has made such investigation and
inquiries as he or she deems reasonably necessary and prudent therefor. The
undersigned further certifies that the financial information and assumptions
which underlie and form the basis for the representations made in this
Certificate were reasonable when made and were made in good faith and continue
to be reasonable as of the date hereof.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The undersigned understands that Administrative Agent and the Banks are
relying on the truth and accuracy of this Certificate in connection with the
transactions contemplated by the Loan Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The undersigned certifies that Borrower is Solvent.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, the undersigned has executed this Certificate on May
&#95;&#95;&#95;&#95;&#95;, 2004.


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD valign="top"></TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


<P align="center" style="font-size: 10pt">D-1
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="center" style="font-size: 10pt"><B><U>EXHIBIT E</U></B>


<P align="center" style="font-size: 10pt"><B>ASSIGNMENT AND ACCEPTANCE</B>

<P align="left" style="font-size: 10pt">This Assignment and Acceptance (the &#147;<B><I>Assignment and Acceptance</I></B>&#148;) is dated as of
the Effective Date set forth below and is entered into by and between
&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95; (the &#147;<B><I>Assignor</I></B>&#148;) and &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95; (the
"<B><I>Assignee</I></B>&#148;). Capitalized terms used but not defined herein shall have the
meanings given to them in the Loan Agreement identified below (as amended, the
"<B><I>Loan Agreement</I></B>&#148;), receipt of a copy of which is hereby acknowledged by the
Assignee. The Standard Terms and Conditions set forth in Annex 1 attached
hereto are hereby agreed to and incorporated herein by reference and made a
part of this Assignment and Acceptance as if set forth herein in full.

<P align="left" style="font-size: 10pt">For an agreed consideration, the Assignor hereby irrevocably sells and assigns
to the Assignee, and the Assignee hereby irrevocably purchases and assumes from
the Assignor, subject to and in accordance with the Standard Terms and
Conditions and the Loan Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below (a)&nbsp;all of the Assignor&#146;s rights and
obligations in its capacity as a Bank under the Loan Agreement and any other
documents or instruments delivered pursuant thereto to the extent related to
the amount and percentage interest identified below of all of such outstanding
rights and obligations of the Assignor under the respective facilities
identified below (including without limitation any letters of credit,
guarantees, and swingline loans included in such facilities) and (b)&nbsp;to the
extent permitted to be assigned under applicable law, all claims, suits, causes
of action and any other right of the Assignor (in its capacity as a Bank)
against any Person, whether known or unknown, arising under or in connection
with the Loan Agreement, any other documents or instruments delivered pursuant
thereto or the loan transactions governed thereby or in any way based on or
related to any of the foregoing, including, but not limited to, contract
claims, tort claims, malpractice claims, statutory claims and all other claims
at law or in equity related to the rights and obligations sold and assigned
pursuant to clause (a)&nbsp;above (the rights and obligations sold and assigned
pursuant to clauses (a)&nbsp;and (b)&nbsp;above being referred to herein collectively as,
the &#147;<B><I>Assigned Interest</I></B>&#148;). Such sale and assignment is without recourse to the
Assignor and, except as expressly provided in this Assignment and Acceptance,
without representation or warranty by the Assignor.

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="top">
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="24%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="70%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">1.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">Assignor:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">2.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Assignee:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;<br>
&#091;and is an Affiliate of &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;<sup>1</sup>&#093;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">3.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Borrower:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">AvalonBay Communities, Inc.</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">4.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Administrative Agent:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&#091;Fleet National Bank&#093;,<br>
as the Administrative Agent under the Loan Agreement</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">5.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Loan Agreement:
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">The Amended and Restated Revolving Loan Agreement dated as of May&nbsp;24, 2004, among AvalonBay
Communities, Inc., as borrower, the Banks parties thereto, JPMorgan Chase Bank, and Fleet National
Bank or any successor thereto, individually and as Administrative Agent, Swing Lender and Issuing
Bank.</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="bottom">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">6.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Assigned Interest:</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="bottom">&nbsp;</TD>
</TR>


<!-- End Table Body --></TABLE>
</DIV>



<P align="left" style="font-size: 10pt"><HR size="1" noshade width="15%" align="left"><BR>
<font style="font-size: 10pt"><sup>1</sup>Select Bank as applicable.</font>


<P align="center" style="font-size: 10pt">E-1
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="1%">&nbsp;</TD>
    <TD width="77%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>

    <TD width="1%">&nbsp;</TD>
</TR><TR style="font-size: 1px" valign="bottom">
    <TD nowrap align="left" colspan="18" style="border-bottom: 2px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">    <TD width="1%" style="border-left: 2px solid #000000">&nbsp;</TD>

    <TD>&nbsp;</TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Aggregate Amount of</TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Amount of</TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Percentage Assigned</TD>
    <TD width="1%" style="border-right: 2px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">    <TD width="1%" style="border-left: 2px solid #000000">&nbsp;</TD>

    <TD>&nbsp;</TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Commitment/Loans</TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Commitment/Loans</TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">of</TD>
    <TD width="1%" style="border-right: 2px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 10pt" valign="bottom">    <TD width="1%" style="border-left: 2px solid #000000">&nbsp;</TD>

    <TD nowrap align="left">Facility Assigned</TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">for all Lenders<u>*</u></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Assigned<u>*</u></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3">Commitment/Loans<u><sup>2</sup></u></TD>
    <TD width="1%" style="border-right: 2px solid #000000">&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
                  <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">Commitment</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">%</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">Revolving Loans</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">%</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">Bid Rate Loans</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">%</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">Participations in
Letters of Credit</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">%</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">&#091;Swing Loans&#093;</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">%</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR style="font-size: 1px" valign="bottom">
    <TD nowrap align="left" colspan="18" style="border-top: 2px solid #000000">&nbsp;</TD>
</TR>


<!-- End Table Body --></TABLE>
</DIV>


<P align="left" style="font-size: 10pt">&#091;7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Trade Date: &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#093;<u><sup>3</sup></u>

<P align="left" style="font-size: 10pt">Effective Date: &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;, 20&#95;&#95;&#95;&#091;TO BE INSERTED BY ADMINISTRATIVE
AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE
REGISTER THEREFOR.&#093;


<P align="center" style="font-size: 10pt"><I>&#091;Remainder of Page Intentionally Left Blank&#093;</I>

<P align="left" style="font-size: 10pt"><HR size="1" noshade width="15%" align="left">
<font style="font-size: 10pt"><u>*</u>Amount to be adjusted by the counterparties to take into account any payments
or prepayments made between the Trade Date and the Effective Date.</font>

<P align="left" style="font-size: 10pt"><u><sup>2</sup></u>Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of
all Lenders thereunder.

<P align="left" style="font-size: 10pt"><u><sup>3</sup></u>To be completed if the Assignor and the Assignee intend that the minimum
assignment amount is to be determined as of the Trade Date.


<P align="center" style="font-size: 10pt">E-2
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">


<P align="left" style="font-size: 10pt">The terms set forth in this Assignment and Acceptance are hereby agreed to:


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3"><U>ASSIGNOR</U><BR>
&#091;NAME OF ASSIGNOR&#093;<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3"><U>ASSIGNEE</U><BR>
&#091;NAME OF ASSIGNEE&#093;<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>

<P align="left" style="font-size: 10pt">Consented to and Accepted:


<P align="left" style="font-size: 10pt"><B>&#091;FLEET NATIONAL BANK&#093;,</B><BR>
acting in its capacity as Administrative<BR>
Agent and as Issuing Bank


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="58%">&nbsp;</TD>
</TR>
<TR>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="1" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>
<P align="left" style="font-size: 10pt">&#091;Consented to:


<P align="left" style="font-size: 10pt">AVALONBAY COMMUNITIES, Inc.,<BR>
a Maryland corporation


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
    <TD width="48%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&#093;<u><sup>4</sup></u>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>
<P align="left" style="font-size: 10pt"><HR size="1" noshade width="15%" align="left">
<font style="font-size: 10pt"><u><sup>4</sup></u>Borrower consent is required when no Event of Default exists; provided that
no Borrower consent is required in the event that the Assignee (or a guarantor
of Assignee's obligations) has a credit rating of AA (or its equivalent) or
higher from a nationally recognized rating agency.</font>


<P align="center" style="font-size: 10pt">E-3
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="right" style="font-size: 10pt">ANNEX 1



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Amended and Restated Revolving Loan Agreement dated as of May&nbsp;24,
2004, among AvalonBay Communities, Inc., as borrower, the Banks parties
thereto, JPMorgan Chase Bank, Fleet National Bank and any successors thereto,
individually and as Administrative Agent, Swing Lender and Issuing Bank (the
"<B><I>Loan Agreement</I></B>&#148;). Capitalized terms used but not defined herein shall have
the meanings given to them in the Assignment and Acceptance to which this annex
is attached and if not defined therein, shall have the meanings given to them
in the Loan Agreement.


<P align="center" style="font-size: 10pt">STANDARD TERMS AND CONDITIONS FOR<BR>
ASSIGNMENT AND ACCEPTANCE


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;<U>Representations and Warranties</U>.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1&nbsp;&nbsp;<U>Assignor</U>. The Assignor (a)&nbsp;represents and warrants that (i)&nbsp;it
is the legal and beneficial owner of the Assigned Interest, (ii)&nbsp;the Assigned
Interest is free and clear of any lien, encumbrance or other adverse claim and
(iii)&nbsp;it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Acceptance and to consummate the
transactions contemplated hereby; and (b)&nbsp;assumes no responsibility with
respect to (i)&nbsp;any statements, warranties or representations made in or in
connection with the Loan Agreement or any other Loan Document, (ii)&nbsp;the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of the Loan Documents or any collateral thereunder, (iii)&nbsp;the financial
condition of the Borrower, any of their subsidiaries or Affiliates or any other
Person obligated in respect of any Loan Document or (iv)&nbsp;the performance or
observance by the Borrower, any of their subsidiaries or Affiliates or any
other Person of any of their respective obligations under any Loan Document.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2.&nbsp;&nbsp;<U>Assignee</U>. The Assignee (a)&nbsp;represents and warrants that (i)
it has full power and authority, and has taken all action necessary, to execute
and deliver this Assignment and Acceptance and to consummate the transactions
contemplated hereby and to become a Bank under the Loan Agreement, (ii)&nbsp;it
meets all requirements of an Assignee under the Loan Agreement (subject to
receipt of such consents as may be required under the Loan Agreement), (iii)
from and after the Effective Date, it shall be bound by the provisions of the
Loan Agreement as a Bank thereunder and, to the extent of the Assigned
Interest, shall have the obligations of a Bank thereunder, and (iv)&nbsp;it has
received a copy of the Loan Agreement, together with copies of the most recent
financial statements delivered pursuant to &#167;4.01(3) and &#167;6.09 thereof, as
applicable, and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance and to purchase the Assigned Interest on the basis of
which it has made such analysis and decision independently and without reliance
on the Administrative Agent or any other Bank, and (v)&nbsp;if it is a non-U.S.
Bank, attached to the Assignment and Acceptance is any documentation required
to be delivered by it pursuant to the terms of the Loan Agreement, duly
completed and executed by the Assignee; and (b)&nbsp;agrees that (i)&nbsp;it will,
independently and without reliance on the Administrative Agent, the Assignor or
any other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Documents, and (ii)&nbsp;it will perform in
accordance with their terms all of the obligations which by the terms of the
Loan Documents are required to be performed by it as a Bank.


<P align="center" style="font-size: 10pt">E-4
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;<U>Payments</U>. From and after the Effective Date, the Administrative
Agent shall make all payments in respect of the Assigned Interest (including
payments of principal, interest, fees and other amounts) to the Assignee
whether such amounts have accrued prior to, on or after the Effective Date.
The Assignor and the Assignee shall make all appropriate adjustments in
payments by the Administrative Agent for periods prior to the Effective Date or
with respect to the making of this assignment directly between themselves.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;<U>General Provisions</U>. This Assignment and Acceptance shall be
binding upon, and inure to the benefit of, the parties hereto and their
respective successors and assigns. This Assignment and Acceptance may be
executed in any number of counterparts, which together shall constitute one
instrument. Delivery of an executed counterpart of a signature page of this
Assignment and Acceptance by telecopy shall be effective as delivery of a
manually executed counterpart of this Assignment and Acceptance. This
Assignment and Acceptance shall be governed by, and construed in accordance
with, the laws of the State of New York.


<P align="center" style="font-size: 10pt">E-5
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="center" style="font-size: 10pt"><B><U>EXHIBIT F</U></B>


<P align="center" style="font-size: 10pt"><B>DESIGNATION AGREEMENT</B>


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Reference is made to that certain Amended and Restated Revolving Loan
Agreement dated as of May&nbsp;24, 2004 (as amended, supplemented or otherwise
modified from time to time, the &#147;<B><I>Loan Agreement</I></B>&#148;) among AvalonBay Communities,
Inc., a Maryland corporation, the banks parties thereto, and Fleet National
Bank, as administrative agent for said banks. Terms defined in the Loan
Agreement not otherwise defined herein are used herein with the same meaning.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>&#091;BANK&#093; </B>(&#147;<B><I>Designor</I></B>&#148;) and &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;, a
&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;(&#147;
<B><I>Designee</I></B>&#148;) agree as follows:


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;Designor hereby designates Designee, and Designee hereby accepts such
designation, to have a right to make Bid Rate Loans pursuant to Section&nbsp;2.02 of
the Loan Agreement. Any assignment by Designor to Designee of its rights to
make a Bid Rate Loan pursuant to such Section shall be effective at the time of
the funding of such Bid Rate Loan and not before such time.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;Except as set forth in Section&nbsp;6 below, Designor makes no representation
or warranty and assumes no responsibility pursuant to this Designation
Agreement with respect to (a)&nbsp;any statements, warranties or representations
made in or in connection with any Loan Document or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of any Loan
Document or any other instrument and document furnished pursuant thereto and
(b)&nbsp;the financial condition of Borrower or the performance or observance by
Borrower of any of its obligations under any Loan Document or any other
instrument or document furnished pursuant thereto.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;Designee (a)&nbsp;confirms that it has received a copy of each Loan Document,
together with copies of such financial statements and other documents and
information as it has med appropriate to make its own credit analysis and
decision to enter into this Designation Agreement; (b)&nbsp;agrees that it will
independently and without reliance upon Administrative Agent, Designor or any
other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under any Loan Document; (c)&nbsp;represents that it is a
Designated Lender; (d)&nbsp;appoints and authorizes Administrative Agent to take
such action as agent on its behalf and to exercise such powers and discretion
under any Loan Document as are delegated to Administrative Agent by the terms
thereof, together with such powers and discretion as are reasonably incidental
thereto; and (e)&nbsp;agrees that it will perform in accordance with their terms all
of the obligations which by the terms of any Loan Document are required to be
performed by it as a Bank.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;Designee hereby appoints Designor as Designee&#146;s agent and
attorney-in-fact, and grants to Designor an irrevocable power of attorney, to
receive payments made for the benefit of Designee under the Loan Agreement, to
deliver and receive all communications and notices under the Loan Agreement and
other Loan Documents and to exercise on Designee&#146;s behalf all rights to vote
and to grant and make approvals, waivers, consents or amendments to or under
the


<P align="center" style="font-size: 10pt">F-1
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">


<P align="left" style="font-size: 10pt">Loan Agreement or other Loan Documents. Any document executed by Designor
on Designee&#146;s behalf in connection with the Loan Agreement or other Loan
Documents shall be binding on Designee. Borrower, Administrative Agent and
each of the Banks may rely on and are beneficiaries of this Designation
Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;Following the execution of this Designation Agreement by Designor and
Designee, it will be delivered to Administrative Agent for acceptance by
Administrative Agent. The effective date for this Designation Agreement (the
"<B><I>Effective Date</I></B>&#148;) shall be the date of acceptance hereof by Administrative
Agent.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;&nbsp;&nbsp;&nbsp;Designor unconditionally agrees to pay or reimburse Designee and save
Designee harmless against all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever which may be imposed or asserted by any of the
parties to the Loan Documents against Designee, in its capacity as such, in any
way relating to or arising out of this Agreement or any other Loan Documents or
any action taken or omitted by the Designee hereunder or thereunder,
<U>provided</U> that Designor shall not be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements if the same results from Designee&#146;s
gross negligence or willful misconduct.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;As of the Effective Date, Designee shall be a party to the Loan Agreement
with a right to make Bid Rate Loans as a Bank pursuant to Section&nbsp;2.02 of the
Loan Agreement and the rights and obligations of a Bank related thereto;
<U>provided</U>, <U>however</U>, that Designee shall not be required to make
payments with respect to such obligations except to the extent of excess cash
flow of such Designee which is not otherwise required to repay obligations of
such Designated Lender which are then due and payable. Notwithstanding the
foregoing, Designor, as administrative agent for Designee, shall be and remain
obligated to Borrower, Administrative Agent and the Banks for each and every of
the obligations of Designee and its Designor with respect to the Loan
Agreement, including, without limitation, any indemnification obligations under
Section&nbsp;10.05 of the Loan Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;This Designation Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;This Designation Agreement may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together
shall constitute one and the same agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, Designor and Designee have executed and delivered this
Designation Agreement as of the date first set forth above.


<P align="center" style="font-size: 10pt"><B>&#091;DESIGNOR&#093;</B>


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt">F-2
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3"><B>&#091;DESIGNEE&#093;</B><BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top">Applicable Lending Office and Address for Notices:</TD>
    <TD>&nbsp;</TD>
</TR>


<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="3" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="3" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
    <TD colspan="3" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>


<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top">Attention:&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;<BR>
Telephone: (&#95;&#95;&#95;) &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;<BR>
Telecopy: (&#95;&#95;&#95;) &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
    <TD colspan="3" valign="top">ACCEPTED AS OF THE &#95;&#95;&#95;&#95;&#95;&#95;DAY OF &#95;&#95;&#95;&#95;&#95;,200_.</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3"><B>&#091;ADMINISTRATIVE AGENT&#093;</B>, as Administrative Agent<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


<P align="center" style="font-size: 10pt">F-3
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="center" style="font-size: 10pt"><B><U>EXHIBIT G-1</U></B>


<P align="center" style="font-size: 10pt"><B>BID RATE QUOTE REQUEST</B>


<P align="right" style="font-size: 10pt">&#091;Date&#093;

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="96%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">To:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>&#091;Administrative Agent&#093;</B>, as Administrative Agent (the &#147;<B><I>Administrative Agent</I></B>&#148;)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">From:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">AvalonBay Communities, Inc.</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Re:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Amended and Restated Revolving Loan Agreement (the <B><I>&#147;Loan Agreement</I></B>&#148;) dated as of May&nbsp;24, 2004 among AvalonBay Communities,
Inc., the Banks parties thereto and the Administrative Agent</TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We hereby give notice pursuant to Section&nbsp;2.02 of the Loan Agreement that
we request Bid Rate Quotes for the following proposed Bid Rate Loans:


<P align="left" style="font-size: 10pt">Date of Borrowing: &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;


<P align="left" style="font-size: 10pt">Principal Amount* &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest Period**


<P align="left" style="font-size: 10pt">$&nbsp;&nbsp;&nbsp;


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Such Bid Rate Quotes should offer a(n) &#091;LIBOR Bid Margin&#093; &#091;Absolute Bid
Rate&#093;.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Terms used herein have the meanings assigned to them in the Loan
Agreement.


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">AVALONBAY COMMUNITIES, INC.<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;<sup>5</sup></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


<P>
<HR size="1" width="18%" align="left" noshade>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top">
    <TD width="1%" nowrap align="right">*</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="98%">Subject to the minimum amount and other requirements set forth in Section
2.02(a) of the Loan Agreement.</TD>
</TR>

<TR><TD>&nbsp;</TD></TR>

<TR valign="top">
    <TD width="1%" nowrap align="right">**</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="98%">Subject to the provisions regarding #Interest Period# in the Loan Agreement.</TD>
</TR>

</TABLE>


<P align="center" style="font-size: 10pt">G-1-1
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">



<P align="center" style="font-size: 10pt"><B><U>EXHIBIT G-2 </U></B>


<P align="center" style="font-size: 10pt"><B><U>INVITATION FOR BID RATE QUOTES</U></B>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="97%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">To:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&#091;Bank&#093;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Re:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Invitation for Bid Rate Quotes to AvalonBay Communities, Inc. (&#147;<B><I>Borrower</I></B>&#148;)</TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to Section&nbsp;2.02 of the Amended and Restated Revolving Loan
Agreement dated as of May&nbsp;24, 2004 among Borrower, the Banks parties thereto
and the undersigned, as Administrative Agent, we are pleased on behalf of
Borrower to invite you to submit Bid Rate Quotes to Borrower for the following
proposed Bid Rate Loans:

<P align="left" style="font-size: 10pt">Date of Borrowing: &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="38%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="60%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><U>Principal Amount</U>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><U>Interest Period</U></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="left" valign="top"><DIV style="margin-left:0px; text-indent:-0px">$&nbsp;&nbsp;&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Such Bid Rate Quotes should offer a(n) &#091;LIBOR Bid Margin&#093; &#091;Absolute Bid
Rate&#093;.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Please respond to this invitation by no later than 2:00 P.M. (New York
time) on &#091;date&#093;.


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3"><B>&#091;ADMINISTRATIVE AGENT&#093;</B>, as Administrative Agent<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt">G-2-1
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="center" style="font-size: 10pt"><B><U>EXHIBIT G-3</U></B>


<P align="center" style="font-size: 10pt"><B>BID RATE QUOTE</B>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="97%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">To:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>&#091;Administrative Agent&#093;</B>, as Administrative Agent</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Re:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Bid Rate Quote to AvalonBay Communities, Inc. (&#147;<B><I>Borrower</I></B>&#148;) pursuant to
the Amended and Restated Revolving Loan Agreement dated May&nbsp;24, 2004
among Borrower, the Banks party thereto and you, as Administrative Agent
(the &#147;<B><I>Loan Agreement</I></B>&#148;)</TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In response to your invitation on behalf of Borrower dated &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;200&#95;&#95;&#95;, we
hereby make the following Bid Rate Quote on the following terms:



<P align="left" style="margin-left:4%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;Quoting Bank:



<P align="left" style="margin-left:4%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;Person to contact at quoting Bank: &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;



<P align="left" style="margin-left:4%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;Date of borrowing: &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;<U>*</U>


<P align="left" style="margin-left:4%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;We hereby offer to make Bid Rate Loan(s) in the following principal
amounts, for the following Interest Periods and at the following rates:

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="20%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="20%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="20%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="29%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Principal
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Interest
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">LIBOR Bid
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Absolute</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Amount<u>**</U>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Period<u>***</u>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Margin<u>****</u>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">Bid Rate</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="left" valign="top"><DIV style="margin-left:0px; text-indent:-0px">$&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD align="left" valign="top"><DIV style="margin-left:0px; text-indent:-0px">$&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>




<P align="left" style="margin-left:4%; font-size: 10pt">&#091;Provided, that the aggregate principal amount of Bid Rate Loans for which
the above offers may be accepted shall not exceed $&nbsp;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;.&#093;



<P align="left" style="margin-left:6%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;LIBOR Reserve Requirement, if any: &#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;



<P align="left" style="margin-left:6%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;&nbsp;&nbsp;Terms used herein have the meanings assigned to them in the Loan Agreement.<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>*</u>As specified in the related Invitation for Bid Rate Quotes.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>**</u>Principal amount bid for each Interest Period may not exceed principal amount
requested. Specify aggregate limitation if the sum of the individual offers
exceeds the amount the Bank is willing to lend. Amounts of bids are subject to
the requirements of Section&nbsp;2.02(c) of the Loan Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>***</u>No more than three (3)&nbsp;bids are permitted for each Interest Period.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>****</u>Margin over or under the LIBOR Interest Rate determined for the applicable
Interest Period. Specify percentage (to the nearest 1/1,000 of 1%) and specify
whether &#147;PLUS&#148; or &#147;MINUS&#148;.


<P align="center" style="font-size: 10pt">G-3-1
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We understand and agree that the offer(s) set forth above, subject to the
satisfaction of the applicable conditions set forth in the Loan Agreement,
irrevocably obligates us to make the Bid Rate Loan(s) for which any offer(s)
are accepted, in whole or in part.


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">Very truly yours, &#091;NAME OF BANK&#093;<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>Date: _________&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2">Authorized Officer&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt">G-3-2
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<P align="center" style="font-size: 10pt"><B><U>EXHIBIT G-4</U></B>


<P align="center" style="font-size: 10pt"><B>ACCEPTANCE OF BID RATE QUOTE</B>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="95%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">To:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>&#091;Administrative Agent&#093;</B>, as Administrative Agent (the &#147;<B><I>Administrative Agent</I></B>&#148;)</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">From:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"> AvalonBay Communities, Inc.</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Re:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Amended and Restated Revolving Loan Agreement (the &#147;<B><I>Loan Agreement</I></B>&#148;) dated as of May&nbsp;24, 2004 among AvalonBay Communities,
Inc., the Banks parties thereto and Administrative Agent</TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>


<P align="left" style="font-size: 10pt">We hereby accept the offers to make Bid Rate Loan(s) set forth in the Bid Rate
Quote(s) identified below:

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="15%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">Date of Bid
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">Principal
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">Interest
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">LIBOR Bid
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom">Absolute</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><u>Bank</u>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom"><u>Rate Quote</u>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom"><u>Amount</u>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom"><u>Period</u>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom"><u>Margin</u>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="bottom"><u>Bid Rate</u></TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>



<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">Very truly yours,<BR>
&nbsp;<BR>
AVALONBAY COMMUNITIES, INC.<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


<P align="center" style="font-size: 10pt">G-4-1
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="center" style="font-size: 10pt"><B><U>EXHIBIT H</U></B>


<P align="center" style="font-size: 10pt"><B>ACCEPTANCE LETTER</B>


<P align="left" style="font-size: 10pt">Fleet National Bank,<BR>
as Administrative Agent


<div align="left" style="font-size: 1px"><HR size="1" noshade width="21%" align="left">
<HR size="1" noshade width="21%" align="left">
</DIV>

<P align="left" style="font-size: 10pt">AvalonBay Communities, Inc.


<div align="left" style="font-size: 10pt"><HR size="1" noshade width="21%" align="left">
<HR size="1" noshade width="21%" align="left"></DIV>


<P align="left" style="font-size: 10pt">Gentlemen:


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We refer to the Amended and Restated Revolving Loan Agreement, dated as of
May&nbsp;24, 2004, among AvalonBay Communities, Inc., as Borrower; JPMorgan Chase
Bank, Fleet National Bank and the other lenders who have become a party to said
Amended and Restated Revolving Loan Agreement as original signatories thereto
or through the execution of Acceptance Letters or Assignment and Assumption
Agreements prior to the date hereof, as Banks; and Fleet National Bank, as
Administrative Agent. Said Amended and Restated Revolving Loan Agreement, as
amended from time to time, is hereinafter referred to as the &#147;<B><I>Loan Agreement</I></B>&#148;.
Capitalized terms not otherwise defined herein shall have the respective
definitions given them in the Loan Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You and we hereby acknowledge and agree that, pursuant to Section&nbsp;2.19 of
the Loan Agreement, we are hereby made a party to the Loan Agreement, and for
all purposes of the Loan Agreement shall be, and shall have all the rights and
obligations of, a Bank, with a Loan Commitment in the amount of $<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </U> . We hereby
acknowledge receipt of a Ratable Loan Note from Borrower in said principal
amount. Each of you acknowledges your consent to our becoming a Bank and to
the amount of our Loan Commitment.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Immediately following the execution hereof by all parties, we shall,
pursuant to paragraph (c)&nbsp;of Section&nbsp;2.19 of the Loan Agreement, remit to
Administrative Agent the sum of $<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </U>, which shall be deemed the first advance
under our Ratable Loan. Attached hereto as Schedule&nbsp;A is an updated list
setting forth the Total Loan Commitment, each Bank&#146;s Loan Commitment and the
principal balance that will be outstanding under each Bank&#146;s Ratable Loan Note
following our disbursement of funds as aforesaid and the application thereof as
provided in said paragraph (c)&nbsp;of Section&nbsp;2.19.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Set forth beneath our signature are the location of our Applicable Lending
Office(s) and our address for notices under the Loan Agreement.


<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Kindly indicate your agreement with the foregoing by your execution below.


<P align="center" style="font-size: 10pt">H-1
</DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">Very truly yours,<BR>
<BR>&#091;NEW BANK&#093;<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="44%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">Address for notices:<BR>
<BR>
<BR>
Applicable Lending Office:<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
</TABLE>

<P align="left" style="font-size: 10pt">Agreement acknowledged this day of<BR>
&#95;&#95;&#95;&#95;&#95;&#95;, 200_.


<P align="left" style="font-size: 10pt">AVALONBAY COMMUNITIES, INC.


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="18%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="68%">&nbsp;</TD>
</TR>
<TR>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>

<P align="left" style="font-size: 10pt">Agreement acknowledged this day of<BR>
&#95;&#95;&#95;&#95;&#95;&#95;, 200_.


<P align="left" style="font-size: 10pt">FLEET NATIONAL BANK, as<BR>
Administrative Agent


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="18%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="68%">&nbsp;</TD>
</TR>
<TR>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>

<P align="left" style="font-size: 10pt">Agreement acknowledged this day of<BR>
&#95;&#95;&#95;&#95;&#95;&#95;, 200_.


<P align="left" style="font-size: 10pt">&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;&#95;,
as Syndication<BR>Agent


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="18%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="68%">&nbsp;</TD>
</TR>
<TR>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">By&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Name:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD valign="top">Title:&nbsp;&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt">H-2
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>

</TABLE>

<P align="right" style="font-size: 10pt"><u>Schedule&nbsp;1</u>


<P align="center" style="font-size: 10pt"><B><U>Loan Commitments</U></B>

<DIV align="center">
<TABLE style="font-size: 11pt" cellspacing="0" border="0" cellpadding="0" width="70%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="1%">&nbsp;</TD>
    <TD width="66%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="6%">&nbsp;</TD>
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>

    <TD width="1%">&nbsp;</TD>
</TR><TR style="font-size: 1px" valign="bottom">
    <TD nowrap align="left" colspan="8" style="border-bottom: 2px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 11pt" valign="bottom">    <TD width="1%" style="border-left: 2px solid #000000">&nbsp;</TD>

    <TD nowrap align="center"><B>Lender</B></TD>
    <TD style="border-right: 1px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Commitment</B></TD>
    <TD width="1%" style="border-right: 2px solid #000000">&nbsp;</TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
              <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">Fleet National Bank</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">35,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">JPMorgan Chase Bank</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">35,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">Wachovia Bank, National Association</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">35,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">Deutsche Bank Trust Company Americas</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">35,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">Morgan Stanley Bank</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">35,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">Wells Fargo Bank, National Association</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">35,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">SouthTrust Bank</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">30,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">SunTrust Bank</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">30,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">UBS Loan Finance LLC</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">30,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">AmSouth Bank</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">23,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">Bank of China, New York Branch</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">23,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">The Bank of New York</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">23,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">KeyBank National Association</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">23,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">PNC Bank, National Association</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">23,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">Scotiabanc Inc.</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">23,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">Chang Hwa Commercial Bank, Ltd., New York Branch</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">13,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">Comerica Bank</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">13,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">First Horizon Bank</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">13,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">US Bank National Association</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">13,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000"><DIV style="margin-left:10px; text-indent:-10px">E.Sun Commercial Bank, Ltd., Los Angeles</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000">$</TD>
    <TD align="right" style="border-top: 1px solid #000000">10,000,000</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD width="1%" style="border-left: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>

<TD style="border-top: 1px solid #000000" align="right"><DIV style="margin-left:100px; text-indent:-10px">Total:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="right" style="border-top: 1px solid #000000"><B>$</B></TD>
    <TD align="right" style="border-top: 1px solid #000000"><B>500,000,000</B></TD>
    <TD style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD width="1%" style="border-right: 2px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
</TR>

<TR style="font-size: 1px" valign="bottom">
    <TD nowrap align="left" colspan="8" style="border-top: 2px solid #000000">&nbsp;</TD>
</TR>


<!-- End Table Body --></TABLE>
</DIV>




</DIV>


</BODY>
</HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-12.1
<SEQUENCE>3
<FILENAME>w99702exv12w1.htm
<DESCRIPTION>EXHIBIT 12.1
<TEXT>
<HTML>
<HEAD>
<TITLE>exv12w1</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="left" style="font-size: 10pt"><B>Exhibit&nbsp;12.1</B>


<P align="center" style="font-size: 10pt"><B>AVALONBAY COMMUNITIES, INC.<BR>
RATIOS OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS</B>

<DIV align="center">
<TABLE style="font-size:8pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="35%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Six Months</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Year</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Year</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Year</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Year</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Year</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Ended</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>June 30,</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>December 31,</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>December 31,</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>December 31,</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>December 31,</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>December 31,</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>2004</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>2003</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>2002</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>2001</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>2000</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>1999</B><HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Income before gain on sale of communities and
cumulative effect of change in accounting principle</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">41,597</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">100,471</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">103,825</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">163,146</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">149,502</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">110,575</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">(Plus) Minority interest in consolidated partnerships</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">275</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">999</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">914</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">997</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,086</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,231</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Earnings before fixed charges</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">41,872</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">101,470</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">104,739</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">164,143</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">150,588</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">111,806</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">(Plus) Fixed charges:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Portion of rents representative
of the interest factor</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">204</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">503</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">527</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">472</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">461</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">526</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Interest expense</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">64,768</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">134,911</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">119,666</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">101,170</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">81,071</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">72,461</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Interest capitalized</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,078</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">24,709</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">29,937</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">27,635</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,328</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,888</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Preferred dividend</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,350</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,744</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,896</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">40,035</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39,779</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39,779</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Total fixed charges (1)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">79,400</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">170,867</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">168,026</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">169,312</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">139,639</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">134,654</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">(Less):</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Interest capitalized</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,078</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">24,709</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">29,937</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">27,635</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,328</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,888</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Preferred dividend</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">4,350</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,744</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">17,896</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">32,497</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39,779</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">39,779</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Earnings (2)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">106,844</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">236,884</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">224,932</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">273,323</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">232,120</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">184,793</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Ratio (2 divided by 1)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1.35</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1.39</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1.34</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1.61</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1.66</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1.37</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>



<P align="left" style="font-size: 10pt"><B>Exhibit&nbsp;12.1 </B>(continued)


<P align="center" style="font-size: 10pt"><B>AVALONBAY COMMUNITIES, INC.<BR>
RATIOS OF EARNINGS TO FIXED CHARGES</B>

<DIV align="center">
<TABLE style="font-size: 9pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head --><TR valign="bottom">
    <TD width="35%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Six Months</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Year</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Year</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Year</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Year</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Year</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Ended</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>Ended</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>June 30,</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>December 31,</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>December 31,</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>December 31,</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>December 31,</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>December 31,</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>2004</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>2003</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>2002</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>2001</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>2000</B><HR size="1" noshade></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" colspan="3"><B>1999</B><HR size="1" noshade></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">Income before gain on sale of communities and
extraordinary item</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">41,597</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">100,471</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">103,825</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">163,146</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">149,502</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">110,575</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">(Plus) Minority interest in consolidated partnerships</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">275</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">999</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">914</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">997</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,086</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1,231</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Earnings before fixed charges</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">41,872</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">101,470</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">104,739</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">164,143</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">150,588</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">111,806</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:10px; text-indent:-10px">(Plus) Fixed charges:</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Portion of rents representative
of the interest factor</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">204</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">503</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">527</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">472</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">461</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">526</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Interest expense</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">64,768</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">134,911</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">119,666</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">101,170</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">81,071</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">72,461</TD>
    <TD>&nbsp;</TD>
</TR>

<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Interest capitalized</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,078</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">24,709</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">29,937</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">27,635</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,328</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,888</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Total fixed charges (1)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">75,050</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">160,123</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">150,130</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">129,277</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">99,860</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">94,875</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:10px; text-indent:-10px">(Less):</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:50px; text-indent:-10px">Interest capitalized</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">10,078</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">24,709</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">29,937</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">27,635</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">18,328</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">21,888</TD>
    <TD>&nbsp;</TD>
</TR>

<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="1" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom" style="background: #eeeeee">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Earnings (2)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">106,844</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">236,884</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">224,932</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">265,785</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">232,120</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">$</TD>
    <TD align="right">184,793</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD><DIV style="margin-left:70px; text-indent:-10px">Ratio (2 divided by 1)</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1.42</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1.48</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1.50</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2.06</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">2.32</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right">1.95</TD>
    <TD>&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD><DIV style="margin-left:10px; text-indent:-10px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="right"><HR size="4" noshade>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<!-- End Table Body --></TABLE>
</DIV>




<P align="center" style="font-size: 10pt">
</DIV>


</BODY>
</HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.1
<SEQUENCE>4
<FILENAME>w99702exv31w1.htm
<DESCRIPTION>EXHIBIT 31.1
<TEXT>
<HTML>
<HEAD>
<TITLE>exv31w1</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">


<P align="right" style="font-size: 10pt"><u><B>Exhibit&nbsp;31.1</B></u>


<P align="left" style="font-size: 10pt"><B>CERTIFICATION</B>



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;I, Bryce Blair, certify that:


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>I have reviewed this quarterly report on Form 10-Q of
AvalonBay Communities, Inc.;</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Based on my knowledge, this report does not contain any
untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not
misleading with respect to the period covered by this report;</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">3.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Based on my knowledge, the financial statements, and
other financial information included in this report, fairly
present in all material respects the financial condition, results
of operations and cash flows of the registrant as of, and for,
the periods presented in this report;</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">4.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The registrant&#146;s other certifying officers and I are
responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules&nbsp;13a-15(e) and
15d-15(e)) for the registrant and have:</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Designed such disclosure controls and
procedures, or caused such disclosure controls and
procedures to be designed under our supervision, to
ensure that material information relating to the
registrant, including its consolidated subsidiaries, is
made known to us by others within those entities,
particularly during the period in which this report is
being prepared;</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Evaluated the effectiveness of the
registrant&#146;s disclosure controls and procedures and
presented in this report our conclusions about the
effectiveness of the disclosure controls and
procedures, as of the end of the period covered by this
report based on such evaluation; and</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">(c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Disclosed in this report any change in the
registrant&#146;s internal control over financial reporting
that occurred during the registrant&#146;s most recent
fiscal quarter (the registrant&#146;s fourth fiscal quarter
in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect,
the registrant&#146;s internal control over financial
reporting; and</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">5.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The registrant&#146;s other certifying officers and I have
disclosed, based on our most recent evaluation of internal
control over financial reporting, to the registrant&#146;s auditors
and the audit committee of the registrant&#146;s board of directors
(or persons performing the equivalent functions):</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>All significant deficiencies and material
weaknesses in the design or operation of internal
control over financial reporting which are reasonably
likely to adversely affect the registrant&#146;s ability to
record, process, summarize and report financial
information; and</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Any fraud, whether or not material, that involves
management or other employees who have a significant role in
the registrant&#146;s internal control over financial reporting.</TD>
</TR>

</TABLE>


<P align="left" style="font-size: 10pt">Date: August 6, 2004


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">/s/ Bryce Blair
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2">Bryce Blair&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2">Chief Executive Officer and President&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

</BODY>
</HTML>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.2
<SEQUENCE>5
<FILENAME>w99702exv31w2.htm
<DESCRIPTION>EXHIBIT 31.2
<TEXT>
<HTML>
<HEAD>
<TITLE>exv31w2</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<P align="right" style="font-size: 10pt"><u><B>Exhibit&nbsp;31.2</B></U>


<P align="left" style="font-size: 10pt"><B>CERTIFICATION</B>



<P align="left" style="font-size: 10pt">&nbsp;&nbsp;&nbsp;I, Thomas J. Sargeant, certify that:


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">1.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>I have reviewed this quarterly report on Form 10-Q of AvalonBay Communities, Inc.;</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">2.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Based on my knowledge, this report does not contain any
untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not
misleading with respect to the period covered by this report;</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">3.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Based on my knowledge, the financial statements, and
other financial information included in this report, fairly
present in all material respects the financial condition, results
of operations and cash flows of the registrant as of, and for,
the periods presented in this report;</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">4.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The registrant&#146;s other certifying officers and I are
responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules&nbsp;13a-15(e) and
15d-15(e)) for the registrant and have:</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Designed such disclosure controls and
procedures, or caused such disclosure controls and
procedures to be designed under our supervision, to
ensure that material information relating to the
registrant, including its consolidated subsidiaries, is
made known to us by others within those entities,
particularly during the period in which this report is
being prepared;</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Evaluated the effectiveness of the
registrant&#146;s disclosure controls and procedures and
presented in this report our conclusions about the
effectiveness of the disclosure controls and
procedures, as of the end of the period covered by this
report based on such evaluation; and</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">(c)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Disclosed in this report any change in the
registrant&#146;s internal control over financial reporting
that occurred during the registrant&#146;s most recent
fiscal quarter (the registrant&#146;s fourth fiscal quarter
in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect,
the registrant&#146;s internal control over financial
reporting; and</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">5.</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The registrant&#146;s other certifying officers and I have
disclosed, based on our most recent evaluation of internal
control over financial reporting, to the registrant&#146;s auditors
and the audit committee of the registrant&#146;s board of directors
(or persons performing the equivalent functions):</TD>
</TR>

</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">(a)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>All significant deficiencies and material
weaknesses in the design or operation of internal
control over financial reporting which are reasonably
likely to adversely affect the registrant&#146;s ability to
record, process, summarize and report financial
information; and</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="6%" style="background: transparent">&nbsp;</TD>
    <TD width="1%" nowrap align="right">(b)</TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Any fraud, whether or not material, that
involves management or other employees who have a
significant role in the registrant&#146;s internal control
over financial reporting.</TD>
</TR>

</TABLE>


<P align="left" style="font-size: 10pt">Date: August 6, 2004


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    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">/s/ Thomas J. Sargeant
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2">Thomas J. Sargeant&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2">Chief Financial Officer&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>6
<FILENAME>w99702exv32.htm
<DESCRIPTION>EXHIBIT 32
<TEXT>
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<TITLE>exv32</TITLE>
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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

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<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>

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<P align="right" style="font-size: 10pt"><u><B>Exhibit&nbsp;32</B></u>


<P align="center" style="font-size: 10pt"><B>CERTIFICATION</B>

<P align="left" style="font-size: 10pt">The undersigned officers of AvalonBay Communities, Inc. (the &#147;Company&#148;) hereby
certify that the Company&#146;s quarterly report on Form 10-Q to which this
certification is attached (the &#147;Report&#148;), as filed with the Securities and
Exchange Commission on the date hereof, fully complies with the requirements of
Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934,
as amended (the &#147;Exchange Act&#148;), and that the information contained in the
Report fairly presents, in all material respects, the financial condition and
results of operations of the Company.


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<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>Date: August 6, 2004&nbsp;</TD>
    <TD valign="top">&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">/s/ Bryce Blair&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2">Bryce Blair&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2">Chief Executive Officer and President&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top">&nbsp;</TD>
    <TD colspan="3">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD valign="top">&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000">/s/ Thomas J. Sargeant
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2">Thomas J. Sargeant&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2">Chief Financial Officer&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>
<P align="left" style="font-size: 10pt">This certification is being furnished and not filed, and shall not be
incorporated into any document for any purpose, under the Securities Exchange
Act of 1934 or the Securities Act of 1933.



<P align="center" style="font-size: 10pt">&nbsp;
</DIV>


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