UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

[x]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
      SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2003

OR

[  ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
      OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to _________

Commission file number: 1-12110

3 Greenway Plaza, Suite 1300, Houston, Texas 77046
(Address of Principal Executive Offices) (Zip Code)

(713) 354-2500
(Registrant's Telephone Number, Including Area Code)

N/A
(Former Name, Former Address and Former Fiscal Year, If Changed Since Last Report)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).
YES X        NO

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date:

As of August 1, 2003, there were 39,332,233 shares of Common Shares of Beneficial Interest, $0.01 par value outstanding.

CAMDEN PROPERTY TRUST
Table of Contents

2

See Notes to Consolidated Financial Statements.

3

See Notes to Consolidated Financial Statements.

4

See Notes to Consolidated Financial Statements.

5

CAMDEN PROPERTY TRUST
Notes to Consolidated Financial Statements
(Unaudited)

1.      Interim Unaudited Financial Information

         The accompanying interim unaudited financial information has been prepared according to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted according to such rules and regulations. Management believes that the disclosures included are adequate to make the information presented not misleading. In the opinion of management, all adjustments and eliminations, consisting only of normal recurring adjustments, necessary to present fairly the financial position of Camden Property Trust as of June 30, 2003 and the results of operations and cash flows for the three and six months ended June 30, 2003 and 2002 have been included. The results of operations for such interim periods are not necessarily indicative of the results for the full year.

Business

        Camden Property Trust is a real estate investment trust (“REIT”) organized on May 25, 1993. We, with our subsidiaries, report as a single business segment, with activities related to the ownership, development, construction and management of multifamily apartment communities. As of June 30, 2003, we owned interests in, operated or were developing 145 multifamily properties containing 51,882 apartment homes located in nine states. At June 30, 2003, we had one recently completed multifamily property containing 364 apartment homes in lease-up. Three of our multifamily properties containing 1,120 apartment homes were in various stages of construction at June 30, 2003. Additionally, we have several sites which we intend to develop into multifamily apartment communities.

        As of June 30, 2003, we had operating properties in 16 markets. No one market contributed more than 15% of our net operating income for the quarter then ended. Currently, Houston, Dallas and Las Vegas contribute 14.2%, 14.2% and 13.6% of our net operating income, respectively. We continually evaluate our portfolio to ensure appropriate geographic diversification. We also seek to selectively dispose of assets that management believes are highly capital intensive, have a lower projected net operating income growth rate than the overall portfolio, or no longer conform to our operating and investment strategies.

        Approximately 24% of our multifamily apartment units at June 30, 2003 were held in Camden Operating, L.P. This operating partnership has issued both common and preferred limited partnership units. As of June 30, 2003, we held 83.1% of the common limited partnership units and the sole 1% general partnership interest of the operating partnership. The remaining 15.9% of the common limited partnership units are primarily held by former officers, directors and investors of Paragon Group, Inc., which we acquired in 1997.

Real Estate Assets, at Cost

        We capitalized $10.0 million and $16.8 million in the six months ended June 30, 2003 and 2002, respectively, of renovation and improvement costs which we believe extended the economic lives and enhanced the earnings of our multifamily properties. Capital expenditures are capitalized and depreciated over their useful lives, which range from 3 to 20 years.

6

CAMDEN PROPERTY TRUST
Notes to Consolidated Financial Statements
(Unaudited)

        Property operating and maintenance expenses included repairs and maintenance expenses totaling $7.4 million and $14.2 million for the three and six months ended June 30, 2003, compared to $7.2 million and $13.1 million for the three and six months ended June 30, 2002. Costs recorded as repairs and maintenance include all costs which do not alter the primary use, extend the expected useful life or improve the safety or efficiency of the related asset. Our largest repair and maintenance expenditures related to landscaping, interior painting and floor coverings.

        Carrying charges, principally interest and real estate taxes, of land under development and buildings under construction are capitalized as part of properties under development and buildings and improvements to the extent that such charges do not cause the carrying value of the asset to exceed its net realizable value. Capitalized interest was $4.2 million and $8.4 million for the three and six months ended June 30, 2003, respectively, and $2.6 million and $4.9 million for the three and six months ended June 30, 2002, respectively. Capitalized real estate taxes were $520,000 and $1.0 million for the three and six months ended June 30, 2003, respectively and $770,000 and $1.3 million for the three and six months ended June 30, 2002, respectively. All operating expenses, excluding depreciation, associated with completed apartment homes for properties in the development and leasing phase are expensed against revenues generated by those apartment homes. Upon substantial completion of the project, all apartment homes are considered operating and we begin expensing all items that were previously considered carrying costs.

Common Share Dividend Declaration

        In June 2003, we announced that our Board of Trust Managers had declared a dividend of $0.635 per share for the second quarter of 2003 which was paid on July 17, 2003 to all common shareholders of record as of June 30, 2003. We paid an equivalent amount per unit to holders of common operating partnership units. This distribution to common shareholders and holders of common operating partnership units equates to an annualized dividend rate of $2.54 per share or unit.

Recent Accounting Pronouncements

        In December 2002, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) No. 148, “Accounting for Stock-Based Compensation – Transition and Disclosure”, which is effective for fiscal years ending after December 15, 2002. SFAS No. 148 amends SFAS No. 123, “Accounting for Stock-Based Compensation” to provide alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation. Our adoption of the prospective method set forth in SFAS No. 148 did not have a material impact on our financial position, results of operations or cash flows. See further discussion of our accounting for stock-based compensation in Note 9.

        In January 2003, FASB issued Interpretation No. 46, “Consolidation of Variable Interest Entities” (“FIN 46”). FIN 46 establishes criteria to identify and assess a company’s interest in variable interest entities and for consolidating those entities. FIN 46 is currently effective for variable interest entities created or obtained after January 31, 2003, and will be effective for all variable interest entities for interim periods beginning after June 15, 2003. Our application of FIN 46 did not require the consolidation of any additional entities.

7

CAMDEN PROPERTY TRUST
Notes to Consolidated Financial Statements
(Unaudited)

Reclassifications

        Certain reclassifications have been made to amounts in prior year financial statements to conform with current year presentation.

2.     Earnings Per Share

        Basic earnings per share is computed using income from continuing operations and the weighted average number of common shares outstanding. Diluted earnings per share reflects common shares issuable from the assumed conversion of common share options and awards granted and units convertible into common shares. Only those items that have a dilutive impact on our basic earnings per share are included in diluted earnings per share. For the three and six months ended June 30, 2003, 1.9 million units convertible into common shares were excluded from the diluted earnings per share calculation, as they were not dilutive.

        The following table presents information necessary to calculate basic and diluted earnings per share for the three and six months ended June 30, 2003 and 2002:

8

CAMDEN PROPERTY TRUST
Notes to Consolidated Financial Statements
(Unaudited)

3.     Discontinued Operations

        The components of net income that are presented as discontinued operations include net operating income, depreciation and property specific interest expense, if any. In addition, the net gain or loss on the disposal of communities will be presented in discontinued operations when recognized. The operating results of discontinued operations related to properties held through our investment in joint ventures that are subsequently sold will continue to be reported in “Equity in income of joint ventures.” There were no property sales which classified as discontinued operations for the first six month of 2003. The operating results of the three properties included in discontinued operations for the three and six months ended June 30, 2002 is as follows:

4.     Third Party Construction Services

        Our construction division performs services for our internally developed construction pipeline, as well as provides construction management and general contracting services for third party owners of multifamily, commercial and retail properties. We are currently under contract for projects ranging from $1.2 million to $10.0 million. We earn fees on these projects ranging from 4% to 7% of the total contracted construction cost which we recognize when they are earned. Fees earned from third party construction projects totaled $548,000 and $507,000 for the three months and $1.5 million and $1.0 million for the six months ended June 30, 2003 and 2002, respectively, and are included in the revenues section of our consolidated statements of operations under “Fee and asset management.” For projects where our fee is based on a fixed price, any cost overruns, as compared to the original budget, incurred during construction will reduce the fee generated on those projects. For any project where cost overruns are expected to be in excess of the fee generated on the project, we will recognize the total expected loss in the period in which the loss is first estimated. During the six months ended June 30, 2003, we recorded cost overruns of $1.9 million on fixed fee projects, which represented the estimate of our remaining costs to complete the projects. These cost overruns are included in fee and asset management expenses in our consolidated statements of operations.

5.     Notes Receivable

        During the third quarter of 2002, we implemented a mezzanine financing program under which we provide financing to owners of real estate properties. In conjunction with this program, as of June 30, 2003, we had $22.5 million in secured notes receivable outstanding, which mature through 2008. Interest on these notes accrues at 12% to 18% annually and is recognized as earned.

        During the second quarter of 2003, two of our executive officers repaid their unsecured loans which totaled $1.8 million. Each note was scheduled to mature in February 2004 and had a fixed interest rate of 5.23%.

9

        We have a $500 million unsecured line of credit which matures in August 2006. The scheduled interest rate is currently based on spreads over LIBOR or Prime. The scheduled interest rate spreads are subject to change as our credit ratings change. Advances under the line of credit may be priced at the scheduled rates, or we may enter into bid rate loans with participating banks at rates below the scheduled rates. These bid rate loans have terms of six months or less and may not exceed the lesser of $250 million or the remaining amount available under the line of credit. The line of credit is subject to customary financial covenants and limitations all of which we were in compliance with at June 30, 2003.

        Our line of credit provides us with the ability to issue up to $100 million in letters of credit. While our issuance of letters of credit does not increase our borrowings outstanding under our line, it does reduce the amount available to us. At June 30, 2003 we had outstanding letters of credit totaling $3.0 million.

        As an alternative to our unsecured line of credit, we from time to time borrow using competitively bid unsecured short-term notes with lenders who may or may not be a part of the unsecured line of credit bank group. Such borrowings vary in term and pricing and are typically priced at interest rates below those available under the unsecured line of credit.

10

        During the second quarter of 2003, we repaid one conventional mortgage note totaling $6.6 million. This note had an interest rate of 7.70% and was scheduled to mature in November 2003. This note was repaid using proceeds available under our unsecured line of credit.

        At June 30, 2003, our floating rate debt, which includes our unsecured line of credit, totaled $233.0 million and had a weighted average interest rate of 2.0%

7.     Net Change in Operating Accounts

         The effect of changes in the operating accounts on cash flows from operating activities is as follows:

8.     Preferred Units

        Our operating partnership has issued $100 million of 8.5% Series B Cumulative Redeemable Perpetual Preferred Units and $53 million of 8.25% Series C Cumulative Redeemable Perpetual Preferred Units. Distributions on the preferred units are payable quarterly. The preferred units are redeemable for cash by the operating partnership beginning in 2004 at par plus the amount of any accumulated and unpaid distributions. The preferred units are convertible beginning in 2009 by the holder into corresponding Series B or C Cumulative Redeemable Perpetual Preferred Shares. The preferred units are subordinate to present and future debt.

9.     Restricted Share and Option Awards

        During the first six months of 2003, we granted 138,105 restricted shares to certain key employees and non-employee trust managers. The restricted shares were issued based on the market value of our common shares at the date of grant and have vesting periods of up to five years. During the six month period ended June 30, 2003, 144,919 restricted shares vested.

        During the first six months of 2003, we also granted 517,000 options with an exercise price of $31.48, which was equal to the market value on the date of grant. The options become exercisable in equal increments over three years, beginning on the first anniversary of the date of grant. During the six month period ended June 30, 2003, previously granted options to purchase 356,474 shares became exercisable, and 38,010 options were exercised at an average price of $29.79 per share.

        The fair value of each option granted in 2003 was estimated on the date of grant utilizing the Black-Scholes option pricing model with the following assumptions: risk-free interest rates of 4.0%, expected life of ten years, dividend yield of 8.1%, and expected share volatility of 18.3%. The fair value of options granted in 2003 was $1.38 per share, and is being amortized over the vesting period in accordance with SFAS No. 148.

11

        For option grants prior to January 1, 2003, we continue to use the intrinsic value method. If the fair value method had been applied to all outstanding stock option grants, our net income and earnings per share at June 30, 2003 and 2002 would have been as follows:

10.   Securities Repurchase Program

        In 1998, we began repurchasing our securities under a program approved by our Board of Trust Managers. The program allows us to repurchase or redeem up to $250 million of our securities through open market purchases and private transactions. Management consummates these repurchases and redemptions at the time when they believe that we can reinvest available cash flow into our own securities at yields which exceed those currently available on direct real estate investments. These repurchases were made and we expect that future repurchases, if any, will be made without incurring additional debt and, in management’s opinion, without reducing our financial flexibility. As of June 30, 2003, we had repurchased 8.8 million common shares and redeemed approximately 106,000 units convertible into common shares for a total cost of $243.6 million. No common shares or units convertible into common shares have been repurchased in 2003.

11.   Townhom Sales

        We have completed construction of 17 for-sale townhomes in the downtown Dallas area at a total cost of approximately $5.5 million. During the six months ended June 30, 2003, we sold our four remaining units at a total sales price of approximately $1.3 million. The proceeds received from these townhome sales are included in other income in our consolidated statements of operations. Other expenses in our consolidated statements of operations represents the construction costs and marketing expenses associated with the townhomes.

12.   Commitments and Contingencies

        Construction Contracts. As of June 30, 2003, we were obligated for approximately $1.4 million of additional expenditures on our three development properties (a substantial amount of which we expect to be funded with debt).

        Contingencies. We are subject to various legal proceedings and claims that arise in the ordinary course of business. These matters are generally covered by insurance. While the resolution of these matters cannot be predicted with certainty, management believes that the final outcome of such matters will not have a material adverse effect on our consolidated financial statements.

12

        In the ordinary course of our business, we issue letters of intent indicating a willingness to negotiate for the purchase or sale of multifamily properties or development land. In accordance with local real estate market practice, such letters of intent are non-binding, and neither party to the letter of intent is obligated to pursue negotiations unless and until a definitive contract is entered into by the parties. Even if definitive contracts are entered into, the letters of intent and resulting contracts contemplate that such contracts will provide the purchaser with time to evaluate the properties and conduct due diligence and during which periods the purchaser will have the ability to terminate the contracts without penalty or forfeiture of any deposit or earnest money. There can be no assurance that definitive contracts will be entered into with respect to any properties covered by letters of intent or that we will acquire or sell any property as to which we may have entered into a definitive contract. Further, due diligence periods are frequently extended as needed. An acquisition or sale becomes probable at the time that the due diligence period expires and the definitive contract has not been terminated. We are then at risk under an acquisition contract, but only to the extent of any earnest money deposits associated with the contract, and are obligated to sell under a sales contract.

        We are currently in the due diligence period for the purchase of land for development and the acquisitions of properties. No assurance can be made that we will be able to complete the negotiations or become satisfied with the outcome of the due diligence.

13

Business

        Camden Property Trust is a real estate investment trust (“REIT”) and, with our subsidiaries, reports as a single business segment with activities related to the ownership, development, construction and management of multifamily apartment communities. As of June 30, 2003, we owned interests in, operated or were developing 145 multifamily properties containing 51,882 apartment homes located in nine states. Our properties, excluding properties in lease-up and under development, had a weighted average occupancy rate of 91.6% for the six months ended June 30, 2003. Weighted average occupancy was 91.8% for the six months ended June 30, 2002. At June 30, 2003, we had one recently completed multifamily property containing 364 apartment homes in lease-up. Three of our multifamily properties containing 1,120 apartment homes were in various stages of construction at June 30, 2003. Additionally, we have several sites which we intend to develop into multifamily apartment communities.

        As of June 30, 2003, we had operating properties in 16 markets. No one market contributed more than 15% of our net operating income for the quarter then ended. Currently, Houston, Dallas and Las Vegas contribute 14.2%, 14.2% and 13.6% of our net operating income, respectively. We continually evaluate our portfolio to ensure appropriate geographic diversification. We also seek to selectively dispose of assets that management believes are highly capital intensive, have a lower projected net operating income growth rate than the overall portfolio, or no longer conform to our operating and investment strategies.

        Approximately 24% of our multifamily apartment units at June 30, 2003 were held in Camden Operating, L.P. This operating partnership has issued both common and preferred limited partnership units. As of June 30, 2003, we held 83.1% of the common limited partnership units and the sole 1% general partnership interest of the operating partnership. The remaining 15.9% of the common limited partnership units are primarily held by former officers, directors and investors of Paragon Group, Inc., which we acquired in 1997.

14

15

At June 30, 2003, we had three properties under development as follows:

($ in millions)

        Real estate assets are carried at cost plus capitalized carrying charges. Carrying charges are principally interest and real estate taxes which are capitalized as part of properties under development. Expenditures directly related to the development, acquisition and improvement of real estate assets, excluding internal costs relating to acquisitions, are capitalized at cost as land, buildings and improvements. All construction and carrying costs are capitalized and reported on the balance sheet in properties under development until individual apartment homes are substantially completed. Upon substantial completion of each apartment home, the total cost for the completed apartment home and the associated land is transferred to buildings and improvements and land, respectively, and the assets are depreciated over their estimated useful lives using the straight-line method of depreciation.

        Where possible, we stage our construction to allow leasing and occupancy during the construction period which we believe minimizes the duration of the lease-up period following completion of construction. Our accounting policy related to properties in the development and leasing phase is that all operating expenses associated with completed apartment homes are expensed against revenues generated by those apartment homes. Upon substantial completion of the project, all apartment homes are considered operating and we begin expensing all items that were previously considered carrying costs.

        If an event or change in circumstance indicates a potential impairment in the value of a property has occurred, our policy is to assess any potential impairment by making a comparison of the current and projected operating cash flows for such property over its remaining useful life, on an undiscounted basis, to the carrying amount of the property. If such carrying amounts were in excess of the estimated projected operating cash flows of the property, we would recognize an impairment loss equivalent to an amount required to adjust the carrying amount to its estimated fair market value.

16

Management's Discussion and Analysis of Financial Condition and Results of Operations

        Our consolidated balance sheet at June 30, 2003 included $242.7 million related to properties under development, including land. Of this amount, $104.7 million relates to our three development projects currently under construction. Additionally, we have $138.0 million invested in land held for future development. Included in this amount is $73.3 million related to projects we expect to begin constructing throughout 2003. We also have $35.0 million invested in land tracts adjacent to current development projects which are being utilized in conjunction with those projects. Upon completion of these current development projects we expect to utilize this land to further develop apartment homes in these areas. We may also sell certain parcels of these undeveloped land tracts to third parties for commercial and retail development.

Results of Operations

        Changes in revenues and expenses related to our operating properties from period to period are primarily due to property developments, dispositions, acquisitions, and the performance of the stabilized properties in the portfolio. Where appropriate, comparisons are made on a dollars-per-weighted-average-apartment home basis in order to adjust for such changes in the number of apartments homes owned during each period. Selected weighted averages for the three and six months ended June 30, 2003 and 2002 are as follows:

Comparison of the Quarters Ended June 30, 2003 and June 30, 2002

        Income from continuing operations decreased $5.4 million, or 47.9% from $11.3 million to $5.9 million for the quarter ended June 30, 2002 and 2003, respectively. The weighted average number of operating apartment homes for the second quarter of 2003 increased by 883 apartment homes, or 1.9%, to 46,218 from 45,335 for the second quarter of 2002. The increase in the weighted average number of operating apartment homes is due to the acquisition of three properties totaling 936 apartment homes and an increase in occupancy at our newly constructed properties. These increases were offset by our disposition of two properties with 786 apartment homes. Total operating properties we owned 100% were 125 and 124 at June 30, 2003 and 2002, respectively. The weighted average number of apartment homes and the number of operating properties excludes the impact of our ownership interest in properties owned in joint ventures, and the impact from properties classified as discontinued operations.

        Our apartment communities generate rental revenue and other income through the leasing of apartment homes. Total property income comprised 97% of our total revenues for the quarters ended June 30, 2003 and 2002. Our primary financial focus for our apartment communities is net operating income. Net operating income represents total property revenues less total property expenses. Net operating income decreased $652,000, or 1.1%, from $60.2 million to $59.6 million for the quarters ended June 30, 2002 and 2003, respectively.

17