Colonial Properties Trust Reports Increased Earnings for Fourth Quarte

BIRMINGHAM, Ala., Jan. 24 /PRNewswire-FirstCall/ -- Colonial Properties Trust (the "Company") a real estate investment trust (REIT) that owns a diversified portfolio of multifamily, office and retail properties, today reported financial results for the quarter and year ended December 31, 2004.

(Logo: http://www.newscom.com/cgi-bin/prnh/20030709/CLPLOGO-c ) For the quarter ended December 31, 2004,

Net income available to common shareholders was $15.0 million or $0.54 per fully diluted share (EPS), an increase from $9.8 million, or $0.37 per fully diluted share for the same period in 2003.

Funds from operations (FFO), a widely accepted measure of REIT performance, increased to $39.9 million, or $1.05 per fully diluted share/unit (FFOPS), from $36.0 million, or $0.97 per share/unit in the fourth quarter 2003. A reconciliation from net income available to common shareholders to funds from operations is provided in the attached tables.

For the year ended December 31, 2004,

Net income available to common shareholders was $39.8 million, or $1.45 per share, an increase from $32.5 million, or $1.29 per fully diluted share, for the year 2003.

FFO increased to $137.6 million, or $3.64 per fully diluted share/unit, from $123.0 million, or $3.45 per fully diluted share/unit for the year 2003, representing a 5.5 percent increase per fully diluted share/unit.

Highlights for the fourth quarter - Announced intention to merge with Cornerstone Realty Income Trust . - Entered into a joint venture with DRA Advisors. - Paid a dividend of $0.67 per common share in October. - Multifamily: - On a same-property basis, posted an NOI increase of 5.5 percent over the comparable period last year. - Occupancies for stabilized properties at year end were 94.6 percent. - Acquired three new multifamily properties; sold one property. - Office: - On a same property basis, increased NOI 0.1 percent from prior year's fourth quarter. - Occupancies at the end of the period for stabilized properties were 92.4 percent, up 20 basis points from third quarter of 2004. - Acquired 177,000 square feet of property in Huntsville, Alabama. - Retail: - On a same-property basis, realized a 1.4 percent increase in NOI compared to fourth quarter 2003. - Occupancies at the end of the period for stabilized properties were 91.4 percent, 150 basis points higher than third quarter of 2004. - Completed the sale of Orlando Fashion Square during the quarter. - Announced the development of a 450,000-square-foot lifestyle center in Birmingham, Alabama.

In comments summarizing the fourth quarter, Thomas H. Lowder, Colonial Properties' Chairman and Chief Executive Officer, stated, "We have significant momentum in our multifamily and retail divisions. Occupancy rates are above 91 percent in each division. As we head into 2005, we are poised to participate in the expected growth of the economy and, in particular, the recovery of the multifamily sector."

Acquisitions and Developments - On October 25, Colonial Properties announced its intention to merge with Cornerstone Realty Income Trust. The Richmond-based company owns and operates a multifamily portfolio with more than 23,000 units. With a total value of approximately $1.5 billion, the transaction is expected to close at the end of March 2005. The Securities and Exchange Commission (SEC) has elected not to review the Company's S-4 filing. - The Company entered into a joint venture with DRA Investments to acquire a 20 percent interest in 16 multifamily properties located in Las Vegas, Phoenix, Tucson and Albuquerque. Colonial Properties manages the 4,223 units with a current average occupancy of 93%. - On October 29, the Company acquired two multifamily properties in North Carolina. Colonial Grand at Beverly Crest in Charlotte, North Carolina has 300 units and is currently 89% occupied. Colonial Village at Patterson Place in Durham has 252 units and is also 89% occupied. The purchase price for each was $23.2 million and $21.5 million, respectively. - On December 7, Colonial Properties acquired Colonial Grand at McGinnis Ferry in Atlanta, Georgia for $40.0 million. The 434-unit multifamily property is 98% occupied. - Purchased office property in Research Place Office Park in Huntsville, Alabama totaling 177,000 square feet for $17.1 million at a capitalization rate of 10.4%. The property is 96.2% occupied. - The Company announced the development of Colonial Pinnacle at Tutwiler Farm in Birmingham, Alabama on November 24. The 450,000-square-foot lifestyle center is scheduled to open October 2006 and will be anchored by Belk, Parisian, JC Penney and Best Buy. Dispositions - On December 2, Colonial Properties and its joint venture partner completed the sale of its interest in Orlando Fashion Square. The total sales price was $123.2 million which represents a capitalization rate of 7.5 %. - The Company sold its 178 unit multifamily property, Colonial Village at Vernon Marsh in Savannah, Georgia on October 15. The sales price was $10.0 million. - Colonial Properties has received bids for each of its malls which are being marketed for sale by Granite Partners. The Company is reviewing the bids and will complete its plans for these assets by the second quarter of 2005. Financing Activities

During the fourth quarter, senior management of the Company met with Fitch, Moody's and S&P. Each rating agency has affirmed the investment grade ratings for the company's bonds of BBB-, Baa3 and BBB-, respectively.

Portfolio Overview

Multifamily: The Company owns and/or manages 29,100 units. This is comprised of 45 wholly owned properties totaling approximately 15,489 units with 94.7 percent occupancy; a partial interest in 33 properties with over 9,520 units. Additionally, the Company provides third party management services for approximately 4,100 units.

Office: Colonial Properties owns or manages 6.8 million square feet of office space. The Company's office portfolio includes 26 wholly owned properties and one partially owned property that together total 5.9 million square feet. The Company manages an additional eight properties totaling 0.9 million square feet.

Retail: The Company owns and/or manages assets approximating 15.6 million square feet of retail centers, which is comprised of 45 wholly owned properties, 3 partially owned properties and management of another 4 centers.

EPS and FFO Per Share Guidance

The Company's guidance for the first-quarter and full-year 2005 for fully diluted EPS and FFOPS is set forth and reconciled below.

First-Quarter 2005 Range Full-Year 2005 Range Low - High Low - High Fully Diluted EPS $2.92 - $2.94 $4.45 - $4.53 Plus: Real Estate Depreciation & Amortization 0.80 - 0.80 2.28 - 2.28 Less: Gain on Sale of Assets (2.85) - (2.85) (3.05) - (3.05) Fully Diluted FFOPS $0.87 - $0.89 $3.68 - $3.76

"Our top priorities in 2005 are to close the merger with Cornerstone, integrate the two companies efficiently and execute our plans for asset dispositions and reinvestments," Lowder stated. "We will also focus on our balance sheet in order to reduce our effective leverage and regain more flexibility."

For additional details of disposition and investment activities, see the Company's detailed Supplemental Financial Highlights available on Colonial Properties' website.

Conference Call and Supplemental Materials

Colonial Properties will hold its quarterly conference call Tuesday, January 25th at 11:00 a.m. Central time. The call will include a review of the Company's fourth-quarter and full year 2004 performance and discussion of its strategy and current expectations for the future.

To participate, dial 1-877-500-9123. As with previous calls, a replay will be available for one week by dialing 800-642-1687; the Conference ID will be 3094365. Access to the live call and a replay will be available through the Company's website at http://www.colonialprop.com/ under "Investor Relations: Shareholder Information."

Colonial Properties produces a supplemental information package that provides detailed information regarding operating performance, investing activities and the Company's overall financial position. Additionally, 2005 earnings guidance is available in the supplemental. For a copy of Colonial Properties' detailed Supplemental Financial Highlights, please visit the Company's website at http://www.colonialprop.com/ under the "Investor Relations: Financial Reporting" tab or contact Barbara Pooley in Investor Relations at 800-645-3917.

Company Summary

Colonial Properties Trust is a diversified REIT that, through its subsidiaries, owns a portfolio of multifamily, office and retail properties where you live, work and shop in Alabama, Florida, Georgia, Mississippi, North Carolina, South Carolina, Tennessee, Texas and Virginia. Colonial Properties Trust performs development, acquisition, management, leasing and brokerage services for its portfolio and properties owned by third parties. Colonial Properties Trust is a diversified REIT, which has a total market capitalization in excess of $3.5 billion. The foundation of Colonial Properties' success is its live, work and shop diversified investment strategy. The Company manages or leases 29,100 apartment units, 6.8 million square feet of office space and 15.6 million square feet of retail shopping space. Additional information on Colonial Properties Trust is available on the Internet at http://www.colonialprop.com/ . The Company, headquartered in Birmingham, Ala., is listed on the New York Stock Exchange under the symbol "CLP" and is included in the S&P SmallCap 600 Index.

Forward Looking Statements

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Except for the historical information contained herein, this news release contains forward-looking statements regarding Company and property performance, and is based on the Company's current expectations and judgment. Actual results could vary materially depending on risks and uncertainties inherent to general and local real estate conditions, competitive factors specific to markets in which Colonial Properties operates, legislative or other regulatory decisions, future interest rate levels or capital markets conditions. The Company assumes no liability to update this information. For more details, please refer to the Company's SEC filings, including its most recent Annual Report on Form 10-K and quarterly reports on Form 10-Q.

Additional Information about the Merger and Where to Find It

In connection with the proposed merger of Cornerstone Realty Income Trust, Inc. with and into Colonial Properties Trust, Cornerstone and Colonial have filed and will continue to file relevant materials with the Securities and Exchange Commission, including a registration statement on Form S-4 that will contain a prospectus and a joint proxy statement. INVESTORS AND SECURITY HOLDERS OF CORNERSTONE AND COLONIAL ARE URGED TO READ THE MATERIALS WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT CORNERSTONE, COLONIAL AND THE MERGER. The proxy statement, prospectus and other relevant materials (when they become available), and any other documents filed by Cornerstone and Colonial with the SEC, may be obtained free of charge at the SEC's web site at http://www.sec.gov/ . In addition, investors and security holders may obtain free copies of the documents filed with the SEC by Colonial by directing a written request to Colonial Properties Trust, 2101 Sixth Avenue North, Suite 750, Birmingham, Alabama 35203, Attention: Investor Relations, and free copies of the documents filed with the SEC by Cornerstone by directing a written request to Cornerstone Realty Income Trust, Inc., 306 East Main Street, Richmond, Virginia 23219, Attention: Investor Relations. Investors and security holders are urged to read the proxy statement, prospectus and the other relevant materials when they become available before making any voting or investment decision with respect to the merger.

Cornerstone, Colonial and their respective executive officers, trustees and directors may be deemed to be participants in the solicitation of proxies from the security holders of Cornerstone and Colonial in connection with the merger. Information about those executive officers and directors of Cornerstone and their ownership of Cornerstone common shares is set forth in the proxy statement for Cornerstone's 2004 Annual Meeting of Shareholders, which was filed with the SEC on April 8, 2004. Information about the executive officers and trustees of Colonial and their ownership of Colonial common stock and limited partnership units in Colonial Realty Limited Partnership is set forth in the proxy statement for Colonial's 2004 Annual Meeting of Shareholders, which was filed with the SEC on March 22, 2004. Investors and security holders may obtain additional information regarding the direct and indirect interests of Cornerstone, Colonial and their respective executive officers, trustees and directors in the merger by reading the proxy statement and prospectus regarding the merger when they become available.

This communication shall not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.

COLONIAL PROPERTIES TRUST Financial Statements Fourth Quarter 2004 BALANCE SHEET ($ in 000s) As of As of 12/31/2004 12/31/2003 ASSETS Real Estate Investments Operating Properties $2,700,016 $2,378,835 Undeveloped Land & Construction in Progress 158,954 114,262 Total Real Estate, before Depreciation 2,858,970 2,493,097 Less: Accumulated Depreciation (437,635) (419,827) Real estate assets held for sale, net 167,712 11,691 Net Real Estate Assets 2,589,047 2,084,961 Cash and Equivalents 10,725 8,070 Restricted Cash 2,333 1,879 Accounts Receivable, net 20,642 10,262 Notes Receivable 906 2,504 Prepaid Expenses 11,238 6,587 Deferred Debt and Lease Costs 36,749 25,832 Investment in Unconsolidated Subsidiaries 65,472 37,496 Other Assets 64,230 17,336 Total Assets $2,801,343 $2,194,927 LIABILITIES Long-Term Liabilities Unsecured Credit Facility $239,970 $205,935 Notes and Mortgages Payable 1,615,817 1,050,145 Mortgages Payable related to real estate held for sale - 11,785 Total Long-Term Liabilities 1,855,787 1,267,865 Other Liabilities 74,548 55,275 Total Liabilities 1,930,335 1,323,140 MINORITY INTEREST & EQUITY Minority Interest 1,389 - Preferred Shares and Units, at Liquidation Value Series B 7-1/4%, Preferred Units 100,000 100,000 Series C 9-1/4%, Preferred Shares 50,000 50,000 Series D 8-1/8%, Preferred Shares 125,000 125,000 Total Preferred Shares and Units, at Liquidation Value 275,000 275,000 Common Equity, including Minority Interest 594,619 596,787 Total Equity, including Minority Interest 871,008 871,787 Total Liabilities and Equity $2,801,343 $2,194,927 SHARES & UNITS OUTSTANDING, END OF PERIOD (shares and units in 000s) As of As of 12/31/2004 12/31/2003 Basic Shares 27,599 26,395 Operating Partnership Units (OP Units) 10,373 10,361 Total Shares & OP Units 37,972 36,756 Dilutive Common Share Equivalents 341 266 Diluted Shares 27,940 26,661 Total Shares & OP Units 38,313 37,022 COLONIAL PROPERTIES TRUST Financial Statements Fourth Quarter 2004 CONSOLIDATED STATEMENTS OF INCOME ($ in 000s, except per share data) Three Months Ended 12/31/2004 12/31/2003 Revenue Minimum Rent $77,351 $60,502 27.8% Percentage Rent 1,359 1,380 -1.5% Tenant Recoveries 8,535 7,273 17.4% Other Property Related Revenue 5,643 4,220 33.7% Other Non-Property Related Revenue 3,648 804 353.7% Total Revenue 96,536 74,179 30.1% Operating Expenses Property Operating Expenses: General Operating Expenses 6,875 5,482 25.4% Salaries and Benefits 4,915 3,779 30.1% Repairs and Maintenance 8,590 6,447 33.2% Taxes, Licenses, and Insurance 8,495 6,671 27.3% Total Property Operating Expenses 28,875 22,379 29.0% General and Administrative 9,078 4,480 102.6% Depreciation 23,926 18,324 30.6% Amortization 4,845 2,080 132.9% Total Operating Expenses 66,724 47,263 41.2% Income from Operations 29,812 26,916 10.8% Other Income (Expense) Interest Expense (22,870) (16,655) 37.3% Income from Investments 385 155 148.4% Gain (Loss) on Hedging Activities 245 (35) -800.0% Gain on Sale of Property 1,587 1,648 -3.7% Other (415) 35 -1285.7% Total Other Expense (21,068) (14,852) 41.9% Income before Minority Interest & Discontinued Operations 8,744 12,064 -27.5% Minority Interest Minority Interest of limited partners (245) - Minority Interest in CRLP - Preferred (1,813) (2,218) -18.3% Minority Interest in CRLP - Common (817) (1,667) -51.0% Total Minority Interest (2,875) (3,885) -26.0% Income from Continuing Operations 5,869 8,179 -28.2% Discontinued Operations Income from Discontinued Operations 7,178 7,034 2.0% Gain (Loss) on Disposal of Discontinued Operations 10,531 388 2614.2% Minority Interest in Discontinued Operations (4,838) (2,103) 130.1% Income from Discontinued Operations 12,871 5,319 142.0% Net Income 18,740 13,498 38.8% Dividends to Preferred Shareholders (3,695) (3,696) 0.0% Preferred Share Issuance Costs - - Net Income Available to Common Shareholders $15,045 $9,802 53.5% Earnings per Share - Basic Continuing Operations $0.08 $0.17 -52.9% Discontinued Operations 0.47 0.20 135.0% EPS - Basic $0.55 $0.37 48.6% Earnings per Share - Diluted Continuing Operations $0.08 $0.17 -52.9% Discontinued Operations 0.46 0.20 130.0% EPS - Diluted $0.54 $0.37 45.9% COLONIAL PROPERTIES TRUST Financial Statements Fourth Quarter 2004 CONSOLIDATED STATEMENTS OF INCOME ($ in 000s, except per share data) Twelve Months Ended 12/31/2004 12/31/2003 Revenue Minimum Rent $276,284 $235,815 17.2% Percentage Rent 2,735 2,494 9.7% Tenant Recoveries 30,132 28,777 4.7% Other Property Related Revenue 19,977 18,190 9.8% Other Non-Property Related Revenue 8,282 4,728 75.2% Total Revenue 337,410 290,004 16.3% Operating Expenses Property Operating Expenses: General Operating Expenses 25,135 21,807 15.3% Salaries and Benefits 17,212 14,233 20.9% Repairs and Maintenance 30,896 26,790 15.3% Taxes, Licenses, and Insurance 31,786 27,034 17.6% Total Property Operating Expenses 105,029 89,864 16.9% General and Administrative 27,208 19,481 39.7% Depreciation 84,475 72,093 17.2% Amortization 13,411 7,762 72.8% Total Operating Expenses 230,123 189,200 21.6% Income from Operations 107,287 100,804 6.4% Other Income (Expense) Interest Expense (78,933) (66,613) 18.5% Income from Investments 990 130 661.5% Gain (Loss) on Hedging Activities 387 (361) -207.2% Gain on Sale of Property 4,608 7,704 -40.2% Other (691) (121) 471.1% Total Other Expense (73,639) (59,261) 24.3% Income before Minority Interest & Discontinued Operations 33,648 41,543 -19.0% Minority Interest Minority Interest of limited partners (281) - Minority Interest in CRLP - Preferred (7,493) (8,873) -15.6% Minority Interest in CRLP - Common (3,064) (3,822) -19.8% Total Minority Interest (10,838) (12,695) -14.6% Income from Continuing Operations 22,810 28,848 -20.9% Discontinued Operations Income from Discontinued Operations 22,114 22,477 -1.6% Gain (Loss) on Disposal of Discontinued Operations 21,832 10,762 102.9% Minority Interest in Discontinued Operations (12,138) (9,822) 23.6% Income from Discontinued Operations 31,808 23,417 35.8% Net Income 54,618 52,265 4.5% Dividends to Preferred Shareholders (14,781) (15,284) -3.3% Preferred Share Issuance Costs - (4,451) -100.0% Net Income Available to Common Shareholders $39,837 $32,530 22.5% Earnings per Share - Basic Continuing Operations $0.30 $0.37 -18.9% Discontinued Operations 1.17 0.94 24.5% EPS - Basic $1.47 $1.30 13.1% Earnings per Share - Diluted Continuing Operations $0.29 $0.36 -19.4% Discontinued Operations 1.16 0.93 24.7% EPS - Diluted $1.45 $1.29 12.4% COLONIAL PROPERTIES TRUST Financial Statements Fourth Quarter 2004 FOURTH QUARTER FUNDS FROM OPERATIONS (FFO) RECONCILIATION ($ in 000s, except per share data) Three Months Ended 12/31/2004 12/31/2003 Net Income Available to Common Shareholders $15,045 $9,802 53.5% Minority Interest in CRLP (Operating Ptr Unitholders) 5,655 3,770 50.0% Total 20,700 13,572 52.5% Adjustments - Consolidated Properties Depreciation - Real Estate 24,466 20,221 21.0% Amortization - Real Estate 3,819 1,188 221.5% Remove: Gain/(Loss) on Sale of Property (5,845) (2,036) 187.1% Include: Gain/(Loss) on Sale of Undepreciated Property 1,424 2,050 -30.5% Total Adjustments - Consolidated 23,864 21,423 11.4% Adjustments - Unconsolidated Properties Depreciation - Real Estate 1,649 1,000 64.9% Amortization - Real Estate 7 15 -53.3% Remove: Gain/(Loss) on Sale of Property (6,267) - Include: Gain/(Loss) on Sale of Undepreciated Property - - Total Adjustments - Unconsolidated (4,611) 1,015 -554.3% Funds from Operations $39,953 $36,010 10.9% FFO per Share Basic $1.06 $0.98 7.6% Diluted $1.05 $0.97 7.7% COLONIAL PROPERTIES TRUST Financial Statements Fourth Quarter 2004 FOURTH QUARTER FUNDS FROM OPERATIONS (FFO) RECONCILIATION ($ in 000s, except per share data) Twelve Months Ended 12/31/2004 12/31/2003 Net Income Available to Common Shareholders $39,837 $32,530 22.5% Minority Interest in CRLP (Operating Ptr Unitholders) 15,202 13,644 11.4% Total 55,039 46,174 19.2% Adjustments - Consolidated Properties Depreciation - Real Estate 90,659 79,006 14.7% Amortization - Real Estate 9,482 4,367 117.1% Remove: Gain/(Loss) on Sale of Property (19,517) (18,463) 5.7% Include: Gain/(Loss) on Sale of Undepreciated Property 4,357 8,040 -45.8% Total Adjustments - Consolidated 84,981 72,950 16.5% Adjustments - Unconsolidated Properties Depreciation - Real Estate 4,562 3,844 18.7% Amortization - Real Estate 89 83 7.2% Remove: Gain/(Loss) on Sale of Property (7,061) - Include: Gain/(Loss) on Sale of Undepreciated Property - - Total Adjustments - Unconsolidated (2,410) 3,927 -161.4% Funds from Operations $137,610 $123,051 11.8% FFO per Share Basic $3.67 $3.47 5.7% Diluted $3.64 $3.45 5.5% Pursuant to the definition of Funds from Operations ("FFO") adopted by the Board of Governors of the National Association of Real Estate Investment Trusts ("NAREIT"), FFO is calculated by adjusting net income (loss) (computed in accordance with GAAP), excluding gains (or losses) from sales of depreciated property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures are calculated to reflect FFO on the same basis. The Company believes that FFO is useful to investors because it provides an additional indicator of the Company's financial and operating performance. This is because, by excluding the effect of real estate depreciation and gains (or losses) from sales of properties (all of which are based on historical costs which may be of limited relevance in evaluating current performance), FFO can facilitate comparison of operating performance among equity REITs. FFO is a widely recognized measure in the Company's industry. FFO does not represent cash generated from operating activities determined in accordance with GAAP, and should not be considered as an alternative to net cash flows from operating activities (determined in accordance with GAAP), as a measure of our liquidity, or as an indicator of our ability to make cash distributions. FOURTH QUARTER SHARES AND UNITS OUTSTANDING, WEIGHTED (shares and units in 000s) Three Months Twelve Ended Months Ended 12/31/ 12/31/ 12/31/ 12/31/ 2004 2003 2004 2003 Basic Shares 27,467 26,267 4.6% 27,121 24,965 8.6% Operating Partnership Units (OP Units) 10,323 10,390 -0.6% 10,347 10,451 -1.0% Total Shares & OP Units 37,790 36,657 3.1% 37,468 35,416 5.8% Dilutive Common Share Equivalents 372 398 -6.6% 341 266 28.1% Diluted Shares 27,839 26,665 4.4% 27,462 25,231 8.8% Total Shares & OP Units 38,162 37,055 3.0% 37,808 35,682 6.0% COLONIAL PROPERTIES TRUST Financial Statements Fourth Quarter 2004 FOURTH QUARTER SEGMENT DATA & RECONCILIATION Three Months Ended Twelve Months Ended 12/31/2004 12/31/2003 12/31/2004 12/31/2003 Net Operating Income (NOI) Divisional Same- Property NOI Multifamily 16,294 15,440 5.5% 61,260 59,250 3.4% Office 15,799 15,791 0.1% 63,238 65,224 -3.0% Retail 28,085 27,699 1.4% 99,805 98,323 1.5% Total Same-Property 60,178 58,930 2.1% 224,303 222,797 0.7% Less: Unconsolidated Assets (989) (857) (3,492) (2,939) Same-Property NOI, Consolidated 59,189 58,073 220,811 219,858 Divisional Non Same- Property NOI Multifamily 6,096 635 14,037 2,640 Office 2,016 242 6,718 602 Retail 7,028 2,999 18,652 10,841 Total Non-Same Property 15,140 3,876 39,407 14,083 Less: Unconsolidated Assets (2,198) (1,819) (6,633) (3,388) Non Same-Property NOI, Consolidated 12,942 2,057 32,774 10,695 Divisional Total NOI Multifamily 22,390 16,075 39.3% 75,297 61,890 21.7% Office 17,815 16,033 11.1% 69,956 65,826 6.3% Retail 35,113 30,698 14.4% 118,457 109,164 8.5% Total Divisional NOI 75,318 62,806 19.9% 263,710 236,880 11.3% Less: NOI, Unconsolidated (3,187) (2,676) (10,125) (9,355) Less: Discontinued Operations (7,844) (9,145) (28,989) (31,906) Unallocated Corporate Rev 3,648 811 8,280 4,578 Other Expense (274) (7) (495) (57) General & Administrative Expenses (9,078) (4,480) (27,208) (19,481) Depreciation (23,926) (18,324) (84,475) (72,093) Amortization (4,845) (2,080) (13,411) (7,762) Income from Operations, restated for additional discontinued operations 29,812 26,905 107,287 100,804 Total Other Income (Expense) (21,068) (14,852) (73,639) (59,261) Income from Continuing Operations before Extraordinary Items, Minority Interest and Discontinued Operations, as restated for additional discontinued operations 8,744 12,053 33,648 41,543 Add: Discontinued Operations Income, post 4Q 2003 - 6,907 - 22,224 Income from Continuing Operations before Extraordinary Items, Minority Interest and Discontinued Operations, per corresponding 10-K or 10-Q 8,744 18,960 33,648 63,767 Divisional NOI is defined as total property revenues, including unconsolidated partnerships and joint ventures, less real estate expenses (such items as repairs and maintenance, payroll, utilities, property taxes, insurance, advertising, management fees). The Company believes Total Divisional NOI (and other NOI measures aggregating segment data) is useful to investors as a meaningful indicator of property level operating performance and current market conditions affecting the Company . Additionally, the Company also believes Total Divisional NOI (and such other NOI measures) is useful to investors because NOI is commonly used industry-wide to evaluate and compare property level operating results of real estate companies, allowing investors to view the Company in comparison to these other real estate companies. The Company cautions investors that other real estate companies may calculate Total Divisional NOI on a basis different than the Company. In addition, Total Divisional NOI (and such other NOI measures) should not be viewed as a substitute measure of performance for GAAP income from continuing operations or other applicable GAAP performance measures.