UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
x
ANNUAL REPORT PURSUANT TO SECTION 13
OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended DECEMBER 31, 2006
OR
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number: 1-12252
EQUITY RESIDENTIAL
(Exact Name of Registrant as Specified in Its Charter)
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes x No o
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No x
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. Yes x No o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.
Large accelerated filer x Accelerated filer o Non-accelerated filer o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x
The aggregate market value of Common Shares held by non-affiliates of the Registrant was approximately $13.0 billion based upon the closing price on June 30, 2006 of $44.73 using beneficial ownership of shares rules adopted pursuant to Section 13 of the Securities Exchange Act of 1934 to exclude voting shares owned by Trustees and Executive Officers, some of who may not be held to be affiliates upon judicial determination.
The number of Common Shares of Beneficial Interest, $0.01 par value, outstanding on January 31, 2007 was 294,015,767.
DOCUMENTS INCORPORATED BY REFERENCE
Part III incorporates by reference certain information to be contained in the Company’s definitive proxy statement, which the Company anticipates will be filed no later than April 20, 2007, and thus these items have been omitted in accordance with General Instruction G (3) to Form 10-K.
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EQUITY RESIDENTIAL
TABLE OF CONTENTS
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General
Equity Residential (“EQR”), a Maryland real estate investment trust (“REIT”) formed in March 1993, is an S&P 500 company focused on the acquisition, development and management of high quality apartment properties in top United States growth markets. EQR has elected to be taxed as a REIT.
The Company is one of the largest publicly traded real estate companies and is the largest publicly traded owner of multifamily properties (based on the aggregate market value of its outstanding Common Shares, the number of apartment units wholly owned and total revenues earned). The Company’s corporate headquarters are located in Chicago, Illinois and the Company also operates approximately thirty-five property management offices throughout the United States.
EQR is the general partner of, and as of December 31, 2006 owned an approximate 93.6% ownership interest in, ERP Operating Limited Partnership, an Illinois limited partnership (the “Operating Partnership”). The Company is structured as an umbrella partnership REIT (“UPREIT”), under which all property ownership and business operations are conducted through the Operating Partnership and its subsidiaries. References to the “Company” include EQR, the Operating Partnership and those entities owned or controlled by the Operating Partnership and/or EQR.
As of December 31, 2006, the Company, directly or indirectly through investments in title holding entities, owned all or a portion of 617 properties in 25 states and the District of Columbia consisting of 165,716 units. The ownership breakdown includes (table does not include various uncompleted development properties):
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|
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Properties |
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Units |
|
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Wholly Owned Properties |
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546 |
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146,442 |
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Partially Owned Properties: |
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|
|
|
|
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Consolidated |
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25 |
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4,873 |
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Unconsolidated |
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45 |
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10,846 |
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Military Housing (Fee Managed) |
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1 |
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3,555 |
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|
|
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617 |
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165,716 |
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As of February 7, 2007, the Company has approximately 5,200 employees who provide real estate operations, leasing, legal, financial, accounting, acquisition, disposition, development and other support functions.
Certain capitalized terms used herein are defined in the Notes to Consolidated Financial Statements.
Available Information
You may access our Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q, our Current Reports on Form 8-K and any amendments to any of those reports we file with the SEC free of charge at our website, www.equityresidential.com . These reports are made available at our website as soon as reasonably practicable after we file them with the SEC.
Business Objectives and Operating Strategies
The Company seeks to maximize current income, capital appreciation of each property and the total return for its shareholders. The Company’s strategy for accomplishing these objectives includes:
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• Leveraging our size and scale in four critical ways:
• Investing in apartment communities located in strategically targeted markets, to maximize our total return on an enterprise level;
• Meeting the needs of our residents by offering a wide array of product choices and a commitment to service;
• Engaging, retaining, and attracting the best people by providing them with the education, resources and opportunities to succeed; and
• Sharing resources, customers and best practices in property management and across the enterprise.
• Owning a highly diversified portfolio by investing in target markets defined by a combination of the following criteria:
• High barrier-to-entry (low supply);
• Strong economic predictors (high demand); and
• Attractive quality of life (high demand and retention).
• Giving residents reasons to stay with the Company by providing a range of product options available in our diversified portfolio and by enhancing their experience through our employees and our services.
• Being open and responsive to market realities to take advantage of investment opportunities that align with our long-term vision.
Acquisition, Development and Disposition Strategies
The Company anticipates that future property acquisitions, developments and dispositions will occur within the United States. Acquisitions and developments may be financed from various sources of capital, which may include retained cash flow, issuance of additional equity and debt securities, sales of properties, joint venture agreements and collateralized and uncollateralized borrowings. In addition, the Company may acquire properties in transactions that include the issuance of limited partnership interests in the Operating Partnership (“OP Units”) as consideration for the acquired properties. Such transactions may, in certain circumstances, enable the sellers to defer, in whole or in part, the recognition of taxable income or gain that might otherwise result from the sales. In addition, EQR may acquire or develop multifamily properties specifically to convert directly into condominiums as well as upgrade and sell existing properties as individual condominiums. EQR may also acquire land parcels to hold and/or sell based on market opportunities.
When evaluating potential acquisitions, developments and dispositions, the Company generally considers the following factors:
• strategically targeted markets;
• income levels and employment growth trends in the relevant market;
• employment and household growth and net migration of the relevant market’s population;
• barriers to entry that would limit competition (zoning laws, building permit availability, supply of undeveloped or developable real estate, local building costs and construction costs, among other factors);
• the location, construction quality, condition and design of the property;
• the current and projected cash flow of the property and the ability to increase cash flow;
• the potential for capital appreciation of the property;
• the terms of resident leases, including the potential for rent increases;
• the potential for economic growth and the tax and regulatory environment of the community in which the property is located;
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• the occupancy and demand by residents for properties of a similar type in the vicinity (the overall market and submarket);
• the prospects for liquidity through sale, financing or refinancing of the property;
• the benefits of integration into existing operations;
• purchase prices and yields of available existing stabilized properties, if any;
• competition from existing multifamily properties, residential properties under development and the potential for the construction of new multifamily properties in the area; and
• opportunistic selling based on demand and price of high quality assets, including condominium conversions.
The Company generally reinvests the proceeds received from property dispositions primarily to achieve its acquisition and development strategies. In addition, when feasible, the Company may structure these transactions as tax-deferred exchanges.
Debt and Equity Activity
Please refer to Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, for the Company’s Capital Structure chart as of December 31, 2006.
Debt and Equity Offerings for the Years Ended December 31, 2006, 2005 and 2004
During 2006:
• The Operating Partnership issued $400.0 million of ten and one-half year 5.375% unsecured fixed rate notes (the “August 2016 Notes”) in a public debt offering in January 2006. The August 2016 Notes were issued at a discount, which is being amortized over the life of the notes on a straight-line basis. The August 2016 Notes are due August 1, 2016 with interest payable semiannually in arrears on February 1 and August 1, commencing August 1, 2006. The Operating Partnership received net proceeds of approximately $395.5 million in connection with this issuance.
• The Operating Partnership issued $650.0 million of twenty-year 3.85% exchangeable senior notes (the “August 2026 Notes”) in a public debt offering in August 2006. The August 2026 Notes were issued at a discount, which is being amortized over the life of the notes on a straight-line basis. The August 2026 Notes are due August 15, 2026 with interest payable semiannually in arrears on February 15 and August 15, commencing February 15, 2007. The Operating Partnership received net proceeds of approximately $637.0 million in connection with this issuance. See Note 9 in the Notes to Consolidated Financial Statements for further discussion.
• The Company issued 2,647,776 Common Shares pursuant to its Share Incentive Plans and received net proceeds of approximately $69.7 million.
• The Company issued 213,427 Common Shares pursuant to its Employee Share Purchase Plan and received net proceeds of approximately $8.0 million.
• The Company repurchased 1,897,912 of its Common Shares on the open market at an average price of $43.85 per share. The Company paid approximately $83.2 million for these shares, which were retired subsequent to the repurchase.
During 2005:
• The Operating Partnership issued $500.0 million of ten and one-half year 5.125% unsecured fixed rate notes (the “March 2016 Notes”) in a public debt offering in September 2005. The March 2016 Notes were issued at a discount, which is being amortized over the life of the notes on a straight-line basis. The March 2016 Notes are due March 15, 2016 with interest payable semiannually in arrears on March 15 and September 15, commencing March 15, 2006. The Operating Partnership received net proceeds of approximately $496.2 million in connection with this issuance.
• The Company issued 2,248,744 Common Shares pursuant to its Share Incentive Plans and received
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net proceeds of approximately $54.9 million.
• The Company issued 286,751 Common Shares pursuant to its Employee Share Purchase Plan and received net proceeds of approximately $8.3 million.
During 2004:
• The Operating Partnership issued $300.0 million of five-year 4.75% unsecured fixed rate notes (the “June 2009 Notes”) in a public debt offering in June 2004. The June 2009 Notes were issued at a discount, which is being amortized over the life of the notes on a straight-line basis. The June 2009 Notes are due June 15, 2009 with interest payable semiannually in arrears on June 1 and December 1, commencing December 1, 2004. The Operating Partnership received net proceeds of approximately $296.8 million in connection with this issuance.
• The Operating Partnership issued $500.0 million of ten-year 5.25% unsecured fixed rate notes (the “September 2014 Notes”) in a public debt offering in September 2004. The September 2014 Notes were issued at a discount, which is being amortized over the life of the notes on a straight-line basis. The September 2014 Notes are due September 15, 2014 with interest payable semiannually in arrears on September 1 and March 1, commencing March 1, 2005. The Operating Partnership received net proceeds of approximately $496.1 million in connection with this issuance.
• The Operating Partnership received $100.0 million as an initial draw on a $300.0 million floating rate loan in July 2004. The loan was paid off in full and terminated in September 2004.
• The Company issued 3,350,759 Common Shares pursuant to its Share Incentive Plans and received net proceeds of approximately $79.0 million.
• The Company issued 275,616 Common Shares pursuant to its Employee Share Purchase Plan and received net proceeds of approximately $6.9 million.
As of February 28, 2007, an unlimited amount of debt securities remains available for issuance by the Operating Partnership under a registration statement that became automatically effective upon filing with the SEC in June 2006 (under SEC regulations enacted in 2005, the registration statement automatically expires on June 29, 2009 and does not contain a maximum issuance amount) and $956.5 million in equity securities remains available for issuance by the Company under a registration statement the SEC declared effective in February 1998.
In May 2002, the Company’s shareholders approved the Company’s 2002 Share Incentive Plan. In January 2003, the Company filed a Form S-8 registration statement to register 23,125,828 Common Shares under this plan. As of January 1, 2007, 23,574,211 shares are available for issuance under this plan.
Credit Facilities
The Operating Partnership has an unsecured revolving credit facility with potential borrowings of up to $1.0 billion maturing on May 29, 2008, with the ability to increase available borrowings by an additional $500.0 million under certain circumstances. Advances under the credit facility bear interest at variable rates based upon LIBOR at various interest periods plus a spread dependent upon the Operating Partnership’s credit rating or based on bids received from the lending group. EQR has guaranteed the Operating Partnership’s credit facility up to the maximum amount and for its full term.
On August 30, 2005, the Operating Partnership entered into a one-year $600.0 million revolving credit facility maturing on August 29, 2006. This credit facility was repaid in full and terminated on January 20, 2006.
On July 6, 2006, the Operating Partnership entered into a one-year $500.0 million revolving credit facility maturing on July 6, 2007. This facility was repaid in full and terminated on October 13, 2006. Advances under this facility bore interest at variable rates based on LIBOR at various interest periods plus a spread dependent upon the Operating Partnership’s credit rating. EQR guaranteed this credit facility up to the maximum amount and for its full term.
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As of December 31, 2006 and December 31, 2005, $460.0 million and $769.0 million, respectively, was outstanding and $69.3 million and $50.2 million, respectively, was restricted (dedicated to support letters of credit and not available for borrowing) on the credit facilities. During the years ended December 31, 2006 and 2005, the weighted average interest rate under the credit facilities were 5.40% and 3.80%, respectively.
Competition
All of the Company’s properties are located in developed areas that include other multifamily properties. The number of competitive multifamily properties in a particular area could have a material effect on the Company’s ability to lease units at the properties or at any newly acquired properties and on the rents charged. The Company may be competing with other entities that have greater resources than the Company and whose managers have more experience than the Company’s managers. In addition, other forms of rental properties and single-family housing provide housing alternatives to potential residents of multifamily properties. See Item 1A Risk Factors for additional information with respect to competition.
Environmental Considerations
See Item 1A Risk Factors for information concerning the potential effects of environmental regulations on our operations.
General
The following Risk Factors may contain defined terms that are different from those used in the other sections of this report. Unless otherwise indicated, when used in this section, the terms “we” and “us” refer to Equity Residential and its subsidiaries, including ERP Operating Limited Partnership.
The occurrence of the events discussed in the following risk factors could adversely affect, possibly in a material manner, our business, financial condition or results of operations, which could adversely affect the value of our common shares of beneficial interest or preferred shares of beneficial interest (which we refer to collectively as “Shares”); preference interests (“Interests”) of a subsidiary of ERP Operating Limited Partnership, our operating partnership; and limited partnership interests in the Operating Partnership (“OP Units”). In this section, we refer to the Shares, Interests, Units and the OP Units together as our “securities”, and the investors who own Shares, Interests, Units and/or OP Units as our “security holders”.
Real property investments are subject to varying degrees of risk and are relatively illiquid. Several factors may adversely affect the economic performance and value of our properties. These factors include changes in the national, regional and local economic climates, local conditions such as an oversupply of multifamily properties or a reduction in demand for our multifamily properties, the attractiveness of our properties to residents, competition from other available multifamily property owners and changes in market rental rates. Our performance also depends on our ability to collect rent from residents and to pay for adequate maintenance, insurance and other operating costs, including real estate taxes, which could increase over time. Also, the expenses of owning and operating a property are not necessarily reduced when circumstances such as market factors and competition cause a reduction in income from the property.
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We May Be Unable to Renew Leases or Relet Units as Leases Expire
When our residents decide not to renew their leases upon expiration, we may not be able to relet their units. Even if the residents do renew or we can relet the units, the terms of renewal or reletting may be less favorable than current lease terms. Because virtually all of our leases are for apartments, they are generally for terms of no more than one year. If we are unable to promptly renew the leases or relet the units, or if the rental rates upon renewal or reletting are significantly lower than expected rates, then our results of operations and financial condition will be adversely affected. Consequently, our cash flow and ability to service debt and make distributions to security holders would be reduced.
New Acquisitions, Developments and/or Condominium Conversion Projects May Fail to Perform as Expected and Competition for Acquisitions May Result in Increased Prices for Properties
We intend to actively acquire and develop multifamily properties for rental operations and/or conversion into condominiums, as well as upgrade and sell existing properties as individual condominiums. We may underestimate the costs necessary to bring an acquired or development property up to standards established for its intended market position. Additionally, we expect that other major real estate investors with significant capital will compete with us for attractive investment opportunities or may also develop properties in markets where we focus our development efforts. This competition may increase prices for multifamily properties or decrease the price at which we expect to sell individual properties. We may not be in a position or have the opportunity in the future to make suitable property acquisitions on favorable terms. We also plan to develop more properties ourselves in addition to co-investing with our development partners for either the rental or condominium market, depending on opportunities in each sub-market. This may increase the overall level of risk associated with our developments. The total number of development units, cost of development and estimated completion dates are subject to uncertainties arising from changing economic conditions (such as the cost of labor and construction materials), competition and local government regulation.
Because Real Estate Investments Are Illiquid, We May Not Be Able to Sell Properties When Appropriate
Real estate investments generally cannot be sold quickly. We may not be able to reconfigure our portfolio promptly in response to economic or other conditions. This inability to respond promptly to changes in the performance of our investments could adversely affect our financial condition and ability to make distributions to our security holders.
Changes in Laws and Litigation Risk Could Affect Our Business
We are generally not able to pass through to our residents under existing leases real estate or other federal, state or local taxes. Consequently, any such tax increases may adversely affect our financial condition and limit our ability to make distributions to our security holders. Similarly, changes that increase our potential liability under environmental laws or our expenditures on environmental compliance would adversely affect our cash flow and ability to make distributions on our securities.
We may become involved in legal proceedings, including but not limited to, proceedings related to consumer, employment, development, condominium conversion, tort and commercial legal issues that if decided adversely to or settled by us, could result in liability material to our financial condition or results of operations.
Environmental Problems Are Possible and Can Be Costly
Federal, state and local laws and regulations relating to the protection of the environment may require a current or previous owner or operator of real estate to investigate and clean up hazardous or toxic
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substances or petroleum product releases at such property. The owner or operator may have to pay a governmental entity or third parties for property damage and for investigation and clean-up costs incurred by such parties in connection with the contamination. These laws typically impose clean-up responsibility and liability without regard to whether the owner or operator knew of or caused the presence of the contaminants. Even if more than one person may have been responsible for the contamination each person covered by the environmental laws may be held responsible for all of the clean-up costs incurred. In addition, third parties may sue the owner or operator of a site for damages and costs resulting from environmental contamination emanating from that site.
Substantially all of our properties have been the subject of environmental assessments completed by qualified independent environmental consultant companies. These environmental assessments have not revealed, nor are we aware of, any environmental liability that our management believes would have a material adverse effect on our business, results of operations, financial condition or liquidity.
Over the past several years, there have been an increasing number of lawsuits against owners and managers of multifamily properties alleging personal injury and property damage caused by the presence of mold in residential real estate. Some of these lawsuits have resulted in substantial monetary judgments or settlements. Insurance carriers have reacted to these liability awards by excluding mold related claims from standard policies and pricing mold endorsements at prohibitively high rates. We have adopted programs designed to minimize the existence of mold in any of our properties as well as guidelines for promptly addressing and resolving reports of mold to minimize any impact mold might have on residents or the property.
We cannot be assured that existing environmental assessments of our properties reveal all environmental liabilities, that any prior owner of any of our properties did not create a material environmental condition not known to us, or that a material environmental condition does not otherwise exist as to any of our properties.
Insurance Policy Deductibles and Exclusions
In order to partially mitigate the substantial increase in insurance costs in recent years, management has gradually increased deductible and self-insured retention amounts. As of December 31, 2006, the Company’s property insurance policy (for Wholly Owned Properties) provides for a per occurrence deductible of $250,000 and self-insured retention of $5.0 million per occurrence, subject to a maximum annual aggregate self-insured retention of $7.5 million, with approximately 90% of any excess losses being covered by insurance. Any earthquake and named windstorm losses are subject to a deductible of 5% of the values of the buildings involved in the losses and are not subject to the aggregate self-insured retention. The Company’s liability and worker’s compensation policies at December 31, 2006, provide for a $1.0 million per occurrence deductible. These higher deductible and self-insured retention amounts do expose the Company to greater potential uninsured losses, such as the property damage caused by hurricanes and other natural disasters, but management believes the savings in insurance premium expense justifies this increased exposure over the long-term.
As a result of the terrorist attacks of September 11, 2001, property insurance carriers have created exclusions for losses from terrorism from our “all risk” property insurance policies. While separate terrorism insurance coverage is available in certain instances, premiums for such coverage are generally very expensive and deductibles are very high. Additionally, the terrorism insurance coverage that is available typically excludes coverage for losses from nuclear, biological and chemical attacks. As of December 31, 2006, the Company was insured for $500 million in terrorism insurance coverage, with a $5.0 million deductible. In the event of a terrorist attack impacting one or more of our properties, we could lose the revenues from the property, our capital investment in the property and possibly face liability claims from residents or others suffering injuries or losses. The Company believes, however, that the number and geographic diversity of its portfolio and its terrorism insurance coverage help to mitigate its exposure to the risks associated with potential terrorist attacks.
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General
In addition to debt, we have $398.3 million of combined liquidation value of outstanding preferred shares of beneficial interest and preference interests and units, with a weighted average dividend preference of 7.69% per annum, as of December 31, 2006. Our use of debt and preferred equity financing creates certain risks, including the following:
Scheduled Debt Payments Could Adversely Affect Our Financial Condition
In the future, our cash flow could be insufficient to meet required payments of principal and interest or to pay distributions on our securities at expected levels.
We may not be able to refinance existing debt (which in virtually all cases requires substantial principal payments at maturity) and, if we can, the terms of such refinancing might not be as favorable as the terms of existing indebtedness. If principal payments due at maturity cannot be refinanced, extended or paid with proceeds of other capital transactions, such as new equity capital, our cash flow will not be sufficient in all years to repay all maturing debt. As a result, we may be forced to postpone capital expenditures necessary for the maintenance of our properties and may have to dispose of one or more properties on terms that would otherwise be unacceptable to us.
Please refer to Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations , for the Company’s debt maturity schedule as of December 31, 2006.
Financial Covenants Could Adversely Affect the Company’s Financial Condition
If a property we own is mortgaged to secure debt and we are unable to meet the mortgage payments, the holder of the mortgage could foreclose on the property, resulting in loss of income and asset value. Foreclosure on mortgaged properties or an inability to refinance existing indebtedness would likely have a negative impact on our financial condition and results of operations.
The mortgages on our properties may contain negative covenants that, among other things, limit our ability, without the prior consent of the lender, to further mortgage the property and to reduce or change insurance coverage. In addition, our unsecured credit facilities contain certain restrictions, requirements and other limitations on our ability to incur debt. The indentures under which a substantial portion of our debt was issued also contain certain financial and operating covenants including, among other things, maintenance of certain financial ratios, as well as limitations on our ability to incur secured and unsecured debt (including acquisition financing), and to sell all or substantially all of our assets. Our credit facilities and indentures are cross-defaulted and also contain cross default provisions with other material debt. Our most restrictive unsecured public debt covenants as of December 31, 2006 and 2005, respectively, are (terms are defined in the indentures):
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Some of the properties were financed with tax-exempt bonds that contain certain restrictive covenants or deed restrictions. We have retained an independent outside consultant to monitor compliance with the restrictive covenants and deed restrictions that affect these properties. If these bond compliance requirements restrict our ability to increase our rental rates to attract low or moderate-income residents, or eligible/qualified residents, then our income from these properties may be limited.
Our Degree of Leverage Could Limit Our Ability to Obtain Additional Financing
Our consolidated debt-to-total market capitalization ratio was 33.0% as of December 31, 2006. Our degree of leverage could have important consequences to security holders. For example, the degree of leverage could affect our ability to obtain additional financing in the future for working capital, capital expenditures, acquisitions, development or other general corporate purposes, making us more vulnerable to a downturn in business or the economy in general.
Rising Interest Rates Could Adversely Affect Cash Flow
Advances under our credit facilities bear interest at variable rates based upon LIBOR at various interest periods, plus a spread dependent upon the Operating Partnership’s credit rating, or based upon bids received from the lending group. Certain public issuances of our senior unsecured debt instruments may also, from time to time, bear interest at floating rates. We may also borrow additional money with variable interest rates in the future. Increases in interest rates would increase our interest expense under these debt instruments and would increase the costs of refinancing existing debt and of issuing new debt. Accordingly, higher interest rates could adversely affect cash flow and our ability to service our debt and to make distributions to security holders. We use interest rate hedging arrangements to manage our exposure to interest rate volatility, but these arrangements may expose us to additional risks, and no strategy can completely insulate us from risks associated with interest rate fluctuations. There can be no assurance that our hedging arrangements will have the desired beneficial impact and may involve costs, such as transaction fees or breakage costs, if we terminate them.
We Depend on Our Key Personnel
We depend on the efforts of the Chairman of our Board of Trustees, Samuel Zell, and our executive officers, particularly David J. Neithercut, our President and Chief Executive Officer and Gerald A. Spector, our Chief Operating Officer. If they resign or otherwise cease to be employed by us, our operations could be temporarily adversely affected. Mr. Zell has entered into executive compensation and retirement benefit agreements with the Company. Mr. Spector has entered into a Deferred Compensation Agreement with the Company that under certain conditions could provide him with a salary benefit after his termination of employment with the Company. In addition, Mr. Zell and Mr. Spector have entered into Noncompetition Agreements with the Company.
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In the event the Chairman of the Board and/or the CEO are unable to serve, (i) the Lead Trustee will automatically be appointed to serve as the interim successor to the Chairman, (ii) the Chairman will automatically be appointed to serve as the interim successor to the CEO and (iii) the Chair of the Compensation Committee of the Board will immediately call a meeting of the Committee to recommend to the full Board the selection of a permanent replacement for either or both positions, as necessary.
Control and Influence by Significant Shareholders Could Be Exercised in a Manner Adverse to Other Shareholders
The consent of certain affiliates of Mr. Zell is required for certain amendments to the Fifth Amended and Restated Agreement of Limited Partnership of the Operating Partnership (the “Partnership Agreement”). As a result of their security ownership and rights concerning amendments to the Partnership Agreement, the security holders referred to herein may have influence over the Company. Although these security holders have not agreed to act together on any matter, they would be in a position to exercise even more influence over the Company’s affairs if they were to act together in the future. This influence could conceivably be exercised in a manner that is inconsistent with the interests of other security holders. For additional information regarding the security ownership of our trustees, including Mr. Zell, and our executive officers, see the Company’s definitive proxy statement.
Shareholders’ Ability to Effect Changes in Control of the Company is Limited
Provisions of Our Declaration of Trust and Bylaws Could Inhibit Changes in Control
Certain provisions of our Declaration of Trust and Bylaws may delay or prevent a change in control of the Company or other transactions that could provide the security holders with a premium over the then-prevailing market price of their securities or which might otherwise be in the best interest of our security holders. This includes the 5% Ownership Limit described below. Also, any future series of preferred shares of beneficial interest may have certain voting provisions that could delay or prevent a change of control or other transactions that might otherwise be in the interest of our security holders.
We Have a Share Ownership Limit for REIT Tax Purposes
To remain qualified as a REIT for federal income tax purposes, not more than 50% in value of our outstanding Shares may be owned, directly or indirectly, by five or fewer individuals at any time during the last half of any year. To facilitate maintenance of our REIT qualification, our Declaration of Trust, subject to certain exceptions, prohibits ownership by any single shareholder of more than 5% of the lesser of the number or value of the outstanding class of common or preferred shares. We refer to this restriction as the “Ownership Limit.” Absent any exemption or waiver granted by our Board of Trustees, securities acquired or held in violation of the Ownership Limit will be transferred to a trust for the exclusive benefit of a designated charitable beneficiary, and the security holder’s rights to distributions and to vote would terminate. A transfer of Shares may be void if it causes a person to violate the Ownership Limit. The Ownership Limit could delay or prevent a change in control and, therefore, could adversely affect our security holders’ ability to realize a premium over the then-prevailing market price for their Shares. To reduce the ability of the Board to use the Ownership Limit as an anti-takeover device, in 2004 the Company amended the Ownership Limit to require, rather than permit, the Board to grant a waiver of the Ownership Limit if the individual seeking a waiver demonstrates that such ownership would not jeopardize the Company’s status as a REIT.
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Our Preferred Shares May Affect Changes in Control
Our Declaration of Trust authorizes the Board of Trustees to issue up to 100 million preferred shares, and to establish the preferences and rights (including the right to vote and the right to convert into common shares) of any preferred shares issued. The Board of Trustees may use its powers to issue preferred shares and to set the terms of such securities to delay or prevent a change in control of the Company, even if a change in control were in the interest of security holders.
Inapplicability of Maryland Law Limiting Certain Changes in Control
Certain provisions of Maryland law applicable to real estate investment trusts prohibit “business combinations” (including certain issuances of equity securities) with any person who beneficially owns ten percent or more of the voting power of outstanding securities, or with an affiliate who, at any time within the two-year period prior to the date in question, was the beneficial owner of ten percent or more of the voting power of the Company’s outstanding voting securities (an “Interested Shareholder”), or with an affiliate of an Interested Shareholder. These prohibitions last for five years after the most recent date on which the Interested Shareholder became an Interested Shareholder. After the five-year period, a business combination with an Interested Shareholder must be approved by two super-majority shareholder votes unless, among other conditions, holders of common shares receive a minimum price for their shares and the consideration is received in cash or in the same form as previously paid by the Interested Shareholder for its common shares. As permitted by Maryland law, however, the Board of Trustees of the Company has opted out of these restrictions with respect to any business combination involving Mr. Zell and certain of his affiliates and persons acting in concert with them. Consequently, the five-year prohibition and the super-majority vote requirements will not apply to a business combination involving us and/or any of them. Such business combinations may not be in the best interest of our security holders.
Our Success as a REIT Is Dependent on Compliance with Federal Income Tax Requirements
Our Failure to Qualify as a REIT Would Have Serious Adverse Consequences to Our Security Holders
We believe that we have qualified for taxation as a REIT for federal income tax purposes since our taxable year ended December 31, 1992 based, in part, upon opinions of tax counsel received whenever we have issued equity securities or engaged in significant merger transactions. We plan to continue to meet the requirements for taxation as a REIT. Many of these requirements, however, are highly technical and complex. We cannot, therefore, guarantee that we have qualified or will qualify in the future as a REIT. The determination that we are a REIT requires an analysis of various factual matters that may not be totally within our control. For example, to qualify as a REIT, our gross income must generally come from rental and other real estate or passive related sources that are itemized in the REIT tax laws. We are also required to distribute to security holders at least 90% of our REIT taxable income excluding capital gains. The fact that we hold our assets through ERP Operating Limited Partnership and its subsidiaries further complicates the application of the REIT requirements. Even a technical or inadvertent mistake could jeopardize our REIT status. Furthermore, Congress and the IRS might make changes to the tax laws and regulations, and the courts might issue new rulings that make it more difficult, or impossible, for us to remain qualified as a REIT. We do not believe, however, that any pending or proposed tax law changes would jeopardize our REIT status.
If we fail to qualify as a REIT, we would be subject to federal income tax at regular corporate rates. Also, unless the IRS granted us relief under certain statutory provisions, we would remain disqualified as a REIT for four years following the year we first failed to qualify. If we fail to qualify as a REIT, we would have to pay significant income taxes. We, therefore, would have less money available for investments or for distributions to security holders. This would likely have a significant adverse affect on the value of our securities. In addition, we would no longer be required to make any distributions to security holders. Even if we quality as a REIT, we are and will continue to be subject to certain federal,
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state and local taxes on our income and property. In addition, our corporate housing business and condominium conversion business, which are conducted through taxable REIT subsidiaries, generally will be subject to federal income tax at regular corporate rates.
We Could Be Disqualified as a REIT or Have to Pay Taxes if Our Merger Partners Did Not Qualify as REITs
If any of our prior merger partners had failed to qualify as a REIT throughout the duration of their existence, then they might have had undistributed “C corporation earnings and profits” at the time of their merger with us. If that was the case and we did not distribute those earnings and profits prior to the end of the year in which the merger took place, we might not qualify as a REIT. We believe based, in part, upon opinions of legal counsel received pursuant to the terms of our merger agreements as well as our own investigations, among other things, that each of our prior merger partners qualified as a REIT and that, in any event, none of them had any undistributed “C corporation earnings and profits” at the time of their merger with us. If any of our prior merger partners failed to qualify as a REIT, an additional concern would be that they would have recognized taxable gain at the time they merged with us. We would be liable for the tax on such gain. In this event, we would have to pay corporate income tax on any gain existing at the time of the applicable merger on assets acquired in the merger if the assets are sold within ten years of the merger. Finally, we could be precluded from electing REIT status for up to four years after the year in which the predecessor entity failed to qualify for REIT status.
Compliance with REIT Distribution Requirements May Affect Our Financial Condition
Distribution Requirements May Increase the Indebtedness of the Company
We may be required from time to time, under certain circumstances, to accrue as income for tax purposes interest and rent earned but not yet received. In such event, or upon our repayment of principal on debt, we could have taxable income without sufficient cash to enable us to meet the distribution requirements of a REIT. Accordingly, we could be required to borrow funds or liquidate investments on adverse terms in order to meet these distribution requirements.
General
The following discussion summarizes the federal income tax considerations material to a holder of common shares. It is not exhaustive of all possible tax considerations. For example, it does not give a detailed discussion of any state, local or foreign tax considerations. The following discussion also does not address all tax matters that may be relevant to prospective shareholders in light of their particular circumstances. Moreover, it does not address all tax matters that may be relevant to shareholders who are subject to special treatment under the tax laws, such as insurance companies, tax-exempt entities, financial institutions or broker-dealers, foreign corporations and persons who are not citizens or residents of the United States.
The specific tax attributes of a particular shareholder could have a material impact on the tax considerations associated with the purchase, ownership and disposition of common shares. Therefore, it is essential that each prospective shareholder consult with his or her own tax advisors with regard to the application of the federal income tax laws to the shareholder’s personal tax situation, as well as any tax consequences arising under the laws of any state, local or foreign taxing jurisdiction.
The information in this section is based on the current Internal Revenue Code, current, temporary and proposed Treasury regulations, the legislative history of the Internal Revenue Code, current administrative interpretations and practices of the Internal Revenue Service, including its practices and policies as set forth in private letter rulings, which are not binding on the Internal Revenue Service, and
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existing court decisions. Future legislation, regulations, administrative interpretations and court decisions could change current law or adversely affect existing interpretations of current law. Any change could apply retroactively. Thus, it is possible that the Internal Revenue Service could challenge the statements in this discussion, which do not bind the Internal Revenue Service or the courts, and that a court could agree with the Internal Revenue Service.
Our Taxation
We elected REIT status beginning with the year that ended December 31, 1992. In any year in which we qualify as a REIT, we generally will not be subject to federal income tax on the portion of our REIT taxable income or capital gain that we distribute to our shareholders. This treatment substantially eliminates the double taxation that applies to most corporations, which pay a tax on their income and then distribute dividends to shareholders who are in turn taxed on the amount they receive. We elected taxable REIT subsidiary status for certain of our corporate subsidiaries, primarily those engaged in condominium conversion and sale activities. As a result, we will be subject to federal income taxes for activities performed by our taxable REIT subsidiaries.
We will be subject to federal income tax at regular corporate rates upon our REIT taxable income or capital gain that we do not distribute to our shareholders. In addition, we will be subject to a 4% excise tax if we do not satisfy specific REIT distribution requirements. We could also be subject to the “alternative minimum tax” on our items of tax preference. In addition, any net income from “prohibited transactions” (i.e., dispositions of property, other than property held by a taxable REIT subsidiary, held primarily for sale to customers in the ordinary course of business) will be subject to a 100% tax. We could also be subject to a 100% penalty tax on certain payments received from or on certain expenses deducted by a taxable REIT subsidiary if any such transaction is not respected by the Internal Revenue Service. If we fail to satisfy the 75% gross income test or the 95% gross income test (described below) but have maintained our qualification as a REIT because we satisfied certain other requirements, we will still generally be subject to a 100% penalty tax on the amount by which we fail such gross income test. If we fail to satisfy any of the REIT asset tests (described below) by more than a de minimis amount, due to reasonable cause, and we nonetheless maintain our REIT qualification because of specified cure provisions, we will be required to pay a tax equal to the greater of $50,000 or the highest corporate tax rate multiplied by the net income generated by the non-qualifying assets. If we fail to satisfy any provision of the Internal Revenue Code that would result in our failure to qualify as a REIT (other than a violation of the REIT gross income or asset tests described below) and the violation is due to reasonable cause, we may retain our REIT qualification but we will be required to pay a penalty of $50,000 for each such failure. Moreover, we may be subject to taxes in certain situations and on certain transactions that we do not presently contemplate.
We believe that we have qualified as a REIT for all of our taxable years beginning with 1992. We also believe that our current structure and method of operation is such that we will continue to qualify as a REIT. However, given the complexity of the REIT qualification requirements, we cannot provide any assurance that the actual results of our operations have satisfied or will satisfy the requirements under the Internal Revenue Code for a particular year.
If we fail to qualify for taxation as a REIT in any taxable year and the relief provisions described herein do not apply, we will be subject to tax on our taxable income at regular corporate rates. We also may be subject to the corporate “alternative minimum tax.” As a result, our failure to qualify as a REIT would significantly reduce the cash we have available to distribute to our shareholders. Unless entitled to statutory relief, we would be disqualified as a REIT for the four taxable years following the year during which qualification was lost. It is not possible to state whether we would be entitled to statutory relief.
Our qualification and taxation as a REIT depend on our ability to satisfy various requirements under the Internal Revenue Code. We are required to satisfy these requirements on a continuing basis through actual annual operating and other results. Accordingly, there can be no assurance that we will be
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able to continue to operate in a manner so as to remain qualified as a REIT.
Ownership of Taxable REIT Subsidiaries by Us . The Internal Revenue Code provides that for taxable years beginning after December 31, 2000, REITs may own greater than ten percent of the voting power and value of the securities of “taxable REIT subsidiaries” or “TRSs”, which are corporations subject to tax as a regular “C” corporation that have elected, jointly with a REIT, to be a TRS. Generally, a taxable REIT subsidiary may own assets that cannot otherwise be owned by a REIT and can perform impermissible tenant services (discussed above), which would otherwise taint our rental income under the REIT income tests. However, the REIT will be obligated to pay a 100% penalty tax on some payments that we receive or on certain expenses deducted by our TRSs if the economic arrangements between us, our tenants and the TRS are not comparable to similar arrangements among unrelated parties. A TRS may also receive income from prohibited transactions without incurring the 100% federal income tax liability imposed to REITs. Income from prohibited transactions may include the purchase and sale of land, the purchase and sale of completed development properties and the sale of condominium units.
TRSs pay federal and state income tax at the full applicable corporate rates. The amount of taxes paid on impermissible tenant services income and the sale of real estate held primarily for sale to customers in the ordinary course of business may be material in amount. The TRSs will attempt to minimize the amount of these taxes, but we cannot guarantee whether, or the extent to which, measures taken to minimize these taxes will be successful. To the extent that these companies are required to pay taxes, less cash may be available for distributions to shareholders.
Share Ownership Test and Organizational Requirement . In order to qualify as a REIT, our shares of beneficial interest must be held by a minimum of 100 persons for at least 335 days of a taxable year that is 12 months, or during a proportionate part of a taxable year of less than 12 months. Also, not more than 50% in value of our shares of beneficial interest may be owned directly or indirectly by applying certain constructive ownership rules, by five or fewer individuals during the last half of each taxable year. In addition, we must meet certain other organizational requirements, including, but not limited to, that (i) the beneficial ownership in us is evidenced by transferable shares and (ii) we are managed by one or more trustees. We believe that we have satisfied all of these tests and all other organizational requirements and that we will continue to do so in the future. In order to ensure compliance with the 100 person test and the 50% share ownership test discussed above, we have placed certain restrictions on the transfer of our shares that are intended to prevent further concentration of share ownership. However, such restrictions may not prevent us from failing these requirements, and thereby failing to qualify as a REIT.
Gross Income Tests . To qualify as a REIT, we must satisfy two gross income tests:
(1) At least 75% of our gross income for each taxable year must be derived directly or indirectly from rents from real property, investments in real estate and/or real estate mortgages, dividends paid by another REIT and from some types of temporary investments.
(2) At least 95% of our gross income for each taxable year must be derived from any combination of income qualifying under the 75% test and dividends, non-real estate mortgage interest, some payments under hedging instruments and gain from the sale or disposition of stock or securities.
To qualify as rents from real property for the purpose of satisfying the gross income tests, rental payments must generally be received from unrelated persons and not be based on the net income of the resident. Also, the rent attributable to personal property must not exceed 15% of the total rent. We may generally provide services to residents without “tainting” our rental income only if such services are “usually or customarily rendered” in connection with the rental of real property and not otherwise considered “impermissible services”. If such services are impermissible, then we may generally provide them only if they are considered de minimis in amount, or are provided through an independent contractor from whom we derive no revenue and that meets other requirements, or through a taxable REIT subsidiary. We believe that services provided to residents by us either are usually or customarily rendered in
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connection with the rental of real property and not otherwise considered impermissible, or, if considered impermissible services, will meet the de minimis test or will be provided by an independent contractor or taxable REIT subsidiary. However, we cannot provide any assurance that the Internal Revenue Service will agree with these positions.
If we fail to satisfy one or both of the gross income tests for any taxable year, we may nevertheless qualify as a REIT for the year if we are entitled to relief under certain provisions of the Internal Revenue Code. In this case, a penalty tax would still be applicable as discussed above. Generally, it is not possible to state whether in all circumstances we would be entitled to the benefit of these relief provisions and in the event these relief provisions do not apply, we will not qualify as a REIT.
Asset Tests . In general, at the close of each quarter of our taxable year, we must satisfy four tests relating to the nature of our assets:
(1) At least 75% of the value of our total assets must be represented by real estate assets (which include for this purpose shares in other real estate investment trusts) and certain cash related items;
(2) Not more than 25% of our total assets may be represented by securities other than those in the 75% asset class;
(3) Except for equity investments in other REITs, qualified REIT subsidiaries (i.e., corporations owned 100% by a REIT that are not TRSs or REITs), or taxable REIT subsidiaries: (a) the value of any one issuer’s securities owned by us may not exceed 5% of the value of our total assets and (b) we may not own more than 10% of the value of or the voting securities of any one issuer; and
(4) Not more than 20% of our total assets may be represented by securities of one or more taxable REIT subsidiaries.
The 10% value test described in clause (b) of (3) above does not apply to certain securities that fall within a safe harbor under the Code. Under the safe harbor, the following are not considered “securities” held by us for purposes of this 10% value test: (i) straight debt securities, (ii) any loan of an individual or an estate, (iii) certain rental agreements for the use of tangible property, (iv) any obligation to pay rents from real property, (v) any security issued by a state or any political subdivision thereof, foreign government or Puerto Rico only if the determination of any payment under such security is not based on the profits of another entity or payments on any obligation issued by such other entity, or (vi) any security issued by a REIT. The timing and payment of interest or principal on a security qualifying as straight debt may be subject to a contingency provided that (A) such contingency does not change the effective yield to maturity, not considering a de minimis change which does not exceed the greater of ¼ of 1% or 5% of the annual yield to maturity or we own $1,000,000 or less of the aggregate issue price or value of the particular issuer’s debt and not more than 12 months of unaccrued interest can be required to be prepaid or (B) the contingency is consistent with commercial practice and the contingency is effective upon a default or the exercise of a prepayment right by the issuer of the debt. If we hold indebtedness from any issuer, including a REIT, the indebtedness will be subject to, and may cause a violation of, the asset tests, unless it is a qualifying real estate asset or otherwise satisfies the above safe harbor. We currently own equity interests in certain entities that have elected to be taxed as REITs for federal income tax purposes and are not publicly traded. If any such entity were to fail to qualify as a REIT, we would not meet the 10% voting stock limitation and the 10% value limitation and we would fail to qualify as a REIT. We believe that we and each of the REITs we own an interest in have and will comply with the foregoing asset tests for REIT qualification. However, we cannot provide any assurance that the Internal Revenue Service will agree with our determinations.
For taxable years commencing on or after January 1, 2005, if we fail to satisfy the 5% or 10% asset tests described above after a 30-day cure period provided in the Internal Revenue Code, we will be deemed to have met such tests if the value of our non-qualifying assets is de minimis (i.e., does not exceed the lesser of 1% of the total value of our assets at the end of the applicable quarter or $10,000,000) and we
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dispose of the non-qualifying assets within six months after the last day of the quarter in which the failure to satisfy the asset tests is discovered. For violations due to reasonable cause and not willful neglect that are in excess of the de minimis exception described above, we may avoid disqualification as a REIT under any of the asset tests, after the 30-day cure period, by disposing of sufficient assets to meet the asset test within such six month period, paying a tax equal to the greater of $50,000 or the highest corporate tax rate multiplied by the net income generated by the non-qualifying assets and disclosing certain information to the Internal Revenue Service. If we cannot avail ourselves of these relief provisions, or if we fail to timely cure any noncompliance with the asset tests, we would cease to qualify as a REIT.
Annual Distribution Requirements . To qualify as a REIT, we are generally required to distribute dividends, other than capital gain dividends, to our shareholders each year in an amount at least equal to 90% of our REIT taxable income. These distributions must be paid either in the taxable year to which they relate, or in the following taxable year if declared before we timely file our tax return for the prior year and if paid with or before the first regular dividend payment date after the declaration is made. We intend to make timely distributions sufficient to satisfy our annual distribution requirements. To the extent that we do not distribute all of our net capital gain or distribute at least 90%, but less than 100% of our REIT taxable income, as adjusted, we are subject to tax on these amounts at regular corporate rates. We will be subject to a 4% excise tax on the excess of the required distribution over the sum of amounts actually distributed and amounts retained for which federal income tax was paid, if we fail to distribute during each calendar year at least the sum of: (1) 85% of our REIT ordinary income for the year; (2) 95% of our REIT capital gain net income for the year; and (3) any undistributed taxable income from prior taxable years. A REIT may elect to retain rather than distribute all or a portion of its net capital gains and pay the tax on the gains. In that case, a REIT may elect to have its shareholders include their proportionate share of the undistributed net capital gains in income as long-term capital gains and receive a credit for their share of the tax paid by the REIT. For purposes of the 4% excise tax described above, any retained amounts would be treated as having been distributed.
Ownership of Partnership Interests By Us . As a result of our ownership of the Operating Partnership, we will be considered to own and derive our proportionate share of the assets and items of income of the Operating Partnership, respectively, for purposes of the REIT asset and income tests, including its share of assets and items of income of any subsidiaries that are partnerships or limited liability companies.
State and Local Taxes . We may be subject to state or local taxation in various jurisdictions, including those in which we transact business or reside. Our state and local tax treatment may not conform to the federal income tax treatment discussed above. Consequently, prospective shareholders should consult their own tax advisors regarding the effect of state and local tax laws on an investment in common shares.
Taxation of Domestic Shareholders Subject to U.S. Tax
General . If we qualify as a REIT, distributions made to our taxable domestic shareholders with respect to their common shares, other than capital gain distributions and distributions attributable to taxable REIT subsidiaries, will be treated as ordinary income to the extent that the distributions come out of earnings and profits. These distributions will not be eligible for the dividends received deduction for shareholders that are corporations nor will they constitute “qualified dividend income” under the Internal Revenue Code, meaning that such dividends will be taxed at marginal rates applicable to ordinary income rather than the special capital gain rates applicable to qualified dividend income distributed to shareholders who satisfy applicable holding period requirements. In determining whether distributions are out of earnings and profits, we will allocate our earnings and profits first to preferred shares and second to the common shares. The portion of ordinary dividends, made after December 31, 2002, which represent ordinary dividends we receive from a TRS, will be designated as “qualified dividend income” to REIT shareholders and are eligible for preferential tax rates if paid to our non-corporate shareholders.
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To the extent we make distributions to our taxable domestic shareholders in excess of our earnings and profits, such distributions will be considered a return of capital. Such distributions will be treated as a tax-free distribution and will reduce the tax basis of a shareholder’s common shares by the amount of the distribution so treated. To the extent such distributions cumulatively exceed a taxable domestic shareholder’s tax basis; such distributions are taxable as a gain from the sale of shares. Shareholders may not include in their individual income tax returns any of our net operating losses or capital losses.
Dividends declared by a REIT in October, November, or December are deemed to have been paid by the REIT and received by its shareholders on December 31 of that year, so long as the dividends are actually paid during January of the following year. However, this treatment only applies to the extent of the REIT’s earnings and profits existing on December 31. To the extent the shareholder distribution paid in January exceeds available earnings and profits as of December 31, the excess is treated as a distribution taxable to shareholders in the year paid. As such, for tax reporting purposes, January distributions paid to our shareholders may be split between two tax years.
Distributions made by us that we properly designate as capital gain dividends will be taxable to taxable domestic shareholders as gain from the sale or exchange of a capital asset held for more than one year. This treatment applies only to the extent that the designated distributions do not exceed our actual net capital gain for the taxable year. It applies regardless of the period for which a domestic shareholder has held his or her common shares. Despite this general rule, corporate shareholders may be required to treat up to 20% of certain capital gain dividends as ordinary income.
Generally, we will classify a portion of our designated capital gain dividends as a 15% rate gain distribution and the remaining portion as an unrecaptured Section 1250 gain distribution. A 15% rate gain distribution would be taxable to taxable domestic shareholders that are individuals, estates or trusts at a maximum rate of 15%. An unrecaptured Section 1250 gain distribution would be taxable to taxable domestic shareholders that are individuals, estates or trusts at a maximum rate of 25%.
If, for any taxable year, we elect to designate as capital gain dividends any portion of the dividends paid or made available for the year to holders of all classes of shares of beneficial interest, then the portion of the capital gains dividends that will be allocable to the holders of common shares will be the total capital gain dividends multiplied by a fraction. The numerator of the fraction will be the total dividends paid or made available to the holders of the common shares for the year. The denominator of the fraction will be the total dividends paid or made available to holders of all classes of shares of beneficial interest.
We may elect to retain (rather than distribute as is generally required) net capital gain for a taxable year and pay the income tax on that gain. If we make this election, shareholders must include in income, as long-term capital gain, their proportionate share of the undistributed net capital gain. Shareholders will be treated as having paid their proportionate share of the tax paid by us on these gains. Accordingly, they will receive a tax credit or refund for the amount. Shareholders will increase the basis in their common shares by the difference between the amount of capital gain included in their income and the amount of the tax they are treated as having paid. Our earnings and profits will be adjusted appropriately.
In general, a shareholder will recognize gain or loss for federal income tax purposes on the sale or other disposition of common shares in an amount equal to the difference between:
(a) the amount of cash and the fair market value of any property received in the sale or other disposition; and
(b) the shareholder’s adjusted tax basis in the common shares.
The gain or loss will be capital gain or loss if the common shares were held as a capital asset. Generally, the capital gain or loss will be long-term capital gain or loss if the common shares were held for more than one year.
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In general, a loss recognized by a shareholder upon the sale of common shares that were held for six months or less, determined after applying certain holding period rules, will be treated as long-term capital loss to the extent that the shareholder received distributions that were treated as long-term capital gains. For shareholders who are individuals, trusts and estates, the long-term capital loss will be apportioned among the applicable long-term capital gain rates to the extent that distributions received by the shareholder were previously so treated.
Taxation of Domestic Tax-Exempt Shareholders
Most tax-exempt organizations are not subject to federal income tax except to the extent of their unrelated business taxable income, which is often referred to as UBTI. Unless a tax-exempt shareholder holds its common shares as debt financed property or uses the common shares in an unrelated trade or business, distributions to the shareholder should not constitute UBTI. Similarly, if a tax-exempt shareholder sells common shares, the income from the sale should not constitute UBTI unless the shareholder held the shares as debt financed property or used the shares in a trade or business.
However, for tax-exempt shareholders that are social clubs, voluntary employee benefit associations, supplemental unemployment benefit trusts, and qualified group legal services plans, income from owning or selling common shares will constitute UBTI unless the organization is able to properly deduct amounts set aside or placed in reserve so as to offset the income generated by its investment in common shares. These shareholders should consult their own tax advisors concerning these set aside and reserve requirements which are set forth in the Internal Revenue Code.
In addition, certain pension trusts that own more than 10% of a “pension-held REIT” must report a portion of the distributions that they receive from the REIT as UBTI. We have not been and do not expect to be treated as a pension-held REIT for purposes of this rule.
Taxation of Foreign Shareholders
The following is a discussion of certain anticipated United States federal income tax consequences of the ownership and disposition of common shares applicable to a foreign shareholder. For purposes of this discussion, a “foreign shareholder” is any person other than:
(a) a citizen or resident of the United States;
(b) a corporation or partnership created or organized in the United States or under the laws of the United States or of any state thereof; or
(c) an estate or trust whose income is includable in gross income for United States federal income tax purposes regardless of its source.
Distributions by Us . Distributions by us to a foreign shareholder that are neither attributable to gain from sales or exchanges by us of United States real property interests nor designated by us as capital gains dividends will be treated as dividends of ordinary income to the extent that they are made out of our earnings and profits. These distributions ordinarily will be subject to withholding of United States federal income tax on a gross basis at a 30% rate, or a lower treaty rate, unless the dividends are treated as effectively connected with the conduct by the foreign shareholder of a United States trade or business. Please note that under certain treaties lower withholding rates generally applicable to dividends do not apply to dividends from REITs. Dividends that are effectively connected with a United States trade or business will be subject to tax on a net basis at graduated rates, and are generally not subject to withholding. Certification and disclosure requirements must be satisfied before a dividend is exempt from withholding under this exemption. A foreign shareholder that is a corporation also may be subject to an additional branch profits tax at a 30% rate or a lower treaty rate.
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We expect to withhold United States income tax at the rate of 30% on any distributions made to a foreign shareholder unless:
(a) a lower treaty rate applies and any required form or certification evidencing eligibility for that reduced rate is filed with us; or
(b) the foreign shareholder files an IRS Form W-8ECI with us claiming that the distribution is effectively connected income.
A distribution in excess of our current or accumulated earnings and profits will not be taxable to a foreign shareholder to the extent that the distribution does not exceed the adjusted basis of the shareholder’s common shares. Instead, the distribution will reduce the adjusted basis of the common shares. To the extent that the distribution exceeds the adjusted basis of the common shares, it will give rise to gain from the sale or exchange of the shareholder’s common shares. The tax treatment of this gain is described below.
We intend to withhold at a rate of 30%, or a lower applicable treaty rate, on the entire amount of any distribution not designated as a capital gain distribution. In such event, a foreign shareholder may seek a refund of the withheld amount from the IRS if it subsequently determined that the distribution was, in fact, in excess of our earnings and profits, and the amount withheld exceeded the foreign shareholder’s United States tax liability with respect to the distribution.
From and after the taxable year ending December 31, 2005, any capital gain dividend with respect to any class of our stock which is “regularly traded” on an established securities market, will be treated as an ordinary dividend described above, if the foreign shareholder did not own more than 5% of such class of stock at any time during the taxable year. Foreign shareholders generally will not be required to report distributions received from us on U.S. federal income tax returns and all distributions treated as dividends for U.S. federal income tax purposes, including any capital gain dividends, will be subject to a 30% U.S. withholding tax (unless reduced or eliminated under an applicable income tax treaty), as described above. In addition, the branch profits tax will no longer apply to such distributions.
Distributions to a foreign shareholder that we designate at the time of the distributions as capital gain dividends, other than those arising from the disposition of a United States real property interest, generally will not be subject to United States federal income taxation unless:
(a) the investment in the common shares is effectively connected with the foreign shareholder’s United States trade or business, in which case the foreign shareholder will be subject to the same treatment as domestic shareholders, except that a shareholder that is a foreign corporation may also be subject to the branch profits tax, as discussed above; or
(b) the foreign shareholder is a nonresident alien individual who is present in the United States for 183 days or more during the taxable year and has a “tax home” in the United States, in which case the nonresident alien individual will be subject to a 30% tax on the individual’s capital gains.
Except as described above, under the Foreign Investment in Real Property Tax Act, which is known as FIRPTA, distributions to a foreign shareholder that are attributable to gain from sales or exchanges of United States real property interests will cause the foreign shareholder to be treated as recognizing the gain as income effectively connected with a United States trade or business. This rule applies whether or not a distribution is designated as a capital gain dividend. Accordingly, foreign shareholders generally would be taxed on these distributions at the same rates applicable to U.S. shareholders, subject to a special alternative minimum tax in the case of nonresident alien individuals. In addition, a foreign corporate shareholder might be subject to the branch profits tax discussed above. We
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are required to withhold 35% of these distributions. The withheld amount can be credited against the foreign shareholder’s United States federal income tax liability.
Although the law is not entirely clear on the matter, it appears that amounts we designate as undistributed capital gains in respect of the common shares held by U.S. shareholders would be treated with respect to foreign shareholders in the same manner as actual distributions of capital gain dividends. Under that approach, foreign shareholders would be able to offset as a credit against the United States federal income tax liability their proportionate share of the tax paid by us on these undistributed capital gains. In addition, foreign shareholders would be able to receive from the IRS a refund to the extent their proportionate share of the tax paid by us were to exceed their actual United States federal income tax liability.
Foreign Shareholders’ Sales of Common Shares . Gain recognized by a foreign shareholder upon the sale or exchange of common shares generally will not be subject to United States taxation unless the shares constitute a “United States real property interest” within the meaning of FIRPTA. The common shares will not constitute a United States real property interest so long as we are a domestically controlled REIT. A domestically controlled REIT is a REIT in which at all times during a specified testing period less than 50% in value of its stock is held directly or indirectly by foreign shareholders. We believe that we are a domestically controlled REIT. Therefore, we believe that the sale of common shares will not be subject to taxation under FIRPTA. However, because common shares and preferred shares are publicly traded, we cannot guarantee that we will continue to be a domestically controlled REIT. In any event, gain from the sale or exchange of common shares not otherwise subject to FIRPTA will be subject to U.S. tax, if either:
(a) the investment in the common shares is effectively connected with the foreign shareholder’s United States trade or business, in which case the foreign shareholder will be subject to the same treatment as domestic shareholders with respect to the gain; or
(b) the foreign shareholder is a nonresident alien individual who is present in the United States for 183 days or more during the taxable year and has a tax home in the United States, in which case the nonresident alien individual will be subject to a 30% tax on the individual’s capital gains.
Even if we do not qualify as or cease to be a domestically controlled REIT, gain arising from the sale or exchange by a foreign shareholder of common shares still would not be subject to United States taxation under FIRPTA as a sale of a United States real property interest if:
(a) the class or series of shares being sold is “regularly traded,” as defined by applicable IRS regulations, on an established securities market such as the New York Stock Exchange; and
(b) the selling foreign shareholder owned 5% or less of the value of the outstanding class or series of shares being sold throughout the five-year period ending on the date of the sale or exchange.
If gain on the sale or exchange of common shares were subject to taxation under FIRPTA, the foreign shareholder would be subject to regular United States income tax with respect to the gain in the same manner as a taxable U.S. shareholder, subject to any applicable alternative minimum tax, a special alternative minimum tax in the case of nonresident alien individuals and the possible application of the branch profits tax in the case of foreign corporations. The purchaser of the common shares would be required to withhold and remit to the IRS 10% of the purchase price.
Information Reporting Requirement and Backup Withholding
We will report to our domestic shareholders and the Internal Revenue Service the amount of
23
distributions paid during each calendar year and the amount of tax withheld, if any. Under certain circumstances, domestic shareholders may be subject to backup withholding. Backup withholding will apply only if such domestic shareholder fails to furnish certain information to us or the Internal Revenue Service. Backup withholding will not apply with respect to payments made to certain exempt recipients, such as corporations and tax-exempt organizations. Domestic shareholders should consult their own tax advisors regarding their qualification for exemption from backup withholding and the procedure for obtaining such an exemption. Backup withholding is not an additional tax. Rather, the amount of any backup withholding with respect to a payment to a domestic shareholder will be allowed as a credit against such person’s United States federal income tax liability and may entitle such person to a refund, provided that the required information is furnished to the Internal Revenue Service.
Item 1B. Unresolved Staff Comments
None.
24
As of December 31, 2006, the Company, directly or indirectly through investments in title holding entities, owned all or a portion of 617 properties in 25 states and the District of Columbia consisting of 165,716 units. The Company’s properties are more fully described as follows:
|
Type |
|
Properties |
|
Units |
|
Average
|
|
December 31, 2006
|
|
|
Garden |
|
553 |
|
145,161 |
|
262 |
|
94.3% |
|
|
Mid/High-Rise |
|
63 |
|
17,000 |
|
270 |
|
92.4% |
|
|
Military Housing |
|
1 |
|
3,555 |
|
3,555 |
|
95.4% |
|
|
Total |
|
617 |
|
165,716 |
|
|
|
|
|
Resident leases are generally for twelve months in length and typically require security deposits. The garden-style properties are generally defined as properties with two and/or three story buildings while the mid-rise/high-rise are defined as properties with greater than three story buildings. These two property types typically provide residents with amenities, which may include a clubhouse, swimming pool, laundry facilities and cable television access. Certain of these properties offer additional amenities such as saunas, whirlpools, spas, sports courts and exercise rooms or other amenities. The military housing properties are defined as those properties located on military bases.
The distribution of the properties throughout the United States reflects the Company’s belief that geographic diversification helps insulate the portfolio from regional and economic influences. At the same time, the Company has sought to create clusters of properties within each of its primary markets in order to achieve economies of scale in management and operation. The Company may nevertheless acquire additional multifamily properties located anywhere in the continental United States.
The following tables set forth certain information by type and state relating to the Company’s properties (occupancy information excludes condominium conversion, development and unstabilized acquired properties) at December 31, 2006:
25
GARDEN-STYLE PROPERTIES
|
|
Properties |
|
Units |
|
Percentage of
|
|
December 31, 2006
|
|
|||
|
Arizona |
|
43 |
|
12,010 |
|
7.25 |
% |
|
95.8 |
% |
|
|
California |
|
104 |
|
26,005 |
|
15.69 |
|
|
95.1 |
|
|
|
Colorado |
|
28 |
|
9,208 |
|
5.56 |
|
|
94.8 |
|
|
|
Connecticut |
|
20 |
|
2,528 |
|
1.53 |
|
|
95.8 |
|
|
|
Florida |
|
75 |
|
23,354 |
|
14.09 |
|
|
94.1 |
|
|
|
Georgia |
|
30 |
|
9,359 |
|
5.65 |
|
|
94.4 |
|
|
|
Illinois |
|
4 |
|
858 |
|
0.52 |
|
|
92.7 |
|
|
|
Maine |
|
5 |
|
672 |
|
0.41 |
|
|
89.0 |
|
|
|
Maryland |
|
21 |
|
5,145 |
|
3.10 |
|
|
91.0 |
|
|
|
Massachusetts |
|
36 |
|
5,010 |
|
3.02 |
|
|
94.0 |
|
|
|
Minnesota |
|
5 |
|
654 |
|
0.39 |
|
|
89.6 |
|
|
|
Missouri |
|
1 |
|
192 |
|
0.12 |
|
|
95.2 |
|
|
|
New Hampshire |
|
1 |
|
390 |
|
0.24 |
|
|
93.3 |
|
|
|
New Jersey |
|
4 |
|
1,402 |
|
0.85 |
|
|
94.4 |
|
|
|
New Mexico |
|
2 |
|
369 |
|
0.22 |
|
|
97.6 |
|
|
|
New York |
|
1 |
|
300 |
|
0.18 |
|
|
94.9 |
|
|
|
North Carolina |
|
28 |
|
7,783 |
|
4.70 |
|
|
95.3 |
|
|
|
Oklahoma |
|
3 |
|
580 |
|
0.35 |
|
|
96.5 |
|
|
|
Oregon |
|
9 |
|
3,164 |
|
1.91 |
|
|
95.0 |
|
|
|
Rhode Island |
|
5 |
|
778 |
|
0.47 |
|
|
93.0 |
|
|
|
Tennessee |
|
8 |
|
2,325 |
|
1.40 |
|
|
95.7 |
|
|
|
Texas |
|
59 |
|
17,822 |
|
10.75 |
|
|
94.7 |
|
|
|
Virginia |
|
16 |
|
5,115 |
|
3.09 |
|
|
93.0 |
|
|
|
Washington |
|
42 |
|
9,452 |
|
5.70 |
|
|
94.9 |
|
|
|
Wisconsin |
|
3 |
|
686 |
|
0.41 |
|
|
97.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Garden-Style |
|
553 |
|
145,161 |
|
87.60 |
% |
|
|
|
|
|
Average Garden-Style |
|
|
|
262 |
|
|
|
|
94.3 |
% |
|
26
MID-RISE/HIGH RISE PROPERTIES
|
State |
|
Properties |
|
Units |
|
Percentage
of
|
|
December 31,
2006
|
|
||
|
California |
|
3 |
|
682 |
|
0.41 |
% |
|
90.2 |
% |
|
|
Colorado |
|
1 |
|
339 |
|
0.21 |
|
|
90.3 |
|
|
|
Connecticut |
|
1 |
|
263 |
|
0.16 |
|
|
94.5 |
|
|
|
Florida |
|
3 |
|
653 |
|
0.39 |
|
|
94.6 |
|
|
|
Georgia |
|
4 |
|
1,178 |
|
0.71 |
|
|
96.3 |
|
|
|
Illinois |
|
1 |
|
478 |
|
0.29 |
|
|
95.3 |
|
|
|
Massachusetts |
|
11 |
|
3,334 |
|
2.01 |
|
|
94.5 |
|
|
|
Minnesota |
|
1 |
|
163 |
|
0.10 |
|
|
90.5 |
|
|
|
New Jersey |
|
5 |
|
1,366 |
|
0.83 |
|
|
95.5 |
|
|
|
New York |
|
7 |
|
2,112 |
|
1.28 |
|
|
97.5 |
|
|
|
Texas |
|
4 |
|
746 |
|
0.45 |
|
|
93.5 |
|
|
|
Virginia |
|
7 |
|
2,855 |
|
1.72 |
|
|
93.4 |
|
|
|
Washington |
|
13 |
|
2,328 |
|
1.40 |
|
|
92.5 |
|
|
|
Washington, D.C. |
|
2 |
|
503 |
|
0.30 |
|
|
74.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Mid-Rise/High-Rise |
|
63 |
|
17,000 |
|
10.26 |
% |
|
|
|
|
|
Average Mid-Rise/High-Rise |
|
|
|
270 |
|
|
|
|
92.4 |
% |
|
MILITARY HOUSING PROPERTIES
|
Washington (Ft. Lewis) |
|
1 |
|
3,555 |
|
2.14 |
% |
|
95.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Military Housing |
|
1 |
|
3,555 |
|
2.14 |
% |
|
|
|
|
|
Average Military Housing |
|
|
|
3,555 |
|
|
|
|
95.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Residential Portfolio |
|
617 |
|
165,716 |
|
100 |
% |
|
|
|
|
The properties currently in various stages of development at December 31, 2006 are included in the following table.
27
Consolidated Development Projects as of December 31, 2006
(Amounts in thousands except for project and unit amounts)
|
Projects |
|
Location |
|
No. of
|
|
Total
|
|
Total
Book
|
|
Total
Book
|
|
Total Debt |
|
Percentage
|
|
Percentage
|
|
Percentage
|
|
Estimated
|
|
Estimated
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Projects Under Development – Wholly Owned: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Bella Vista III |
|
Woodland Hills, CA |
|
264 |
|
$ |
73,336 |
|
$ |
59,682 |
|
$ |
59,682 |
|
$ |
— |
|
81 |
% |
|
3 |
% |
|
— |
|
|
2Q 2007 |
|
4Q 2007 |
|
|
Highland Glen II |
|
Westwood, MA |
|
102 |
|
21,620 |
|
7,069 |
|
7,069 |
|
1,384 |
|
43 |
% |
|
— |
|
|
% |
|
|
2Q 2007 |
|
1Q 2008 |
|
||||
|
Emerson/CRP II |
|
Boston, MA |
|
310 |
|
167,953 |
|
42,597 |
|
42,597 |
|
— |
|
33 |
% |
|
— |
|
|
% |
|
|
2Q 2008 |
|
1Q 2009 |
|
||||
|
Redmond Ridge |
|
Redmond, WA |
|
321 |
|
55,457 |
|
13,648 |
|
13,648 |
|
— |
|
12 |
% |
|
— |
|
|
% |
|
|
2Q 2008 |
|
3Q 2010 |
|
||||
|
77 Hudson |
|
Jersey City, NJ |
|
481 |
|
242,129 |
|
43,821 |
|
43,821 |
|
— |
|
9 |
% |
|
— |
|
|
% |
|
|
2Q 2009 |
|
4Q 2010 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Projects Under Development – Wholly Owned |
|
|
|
1,478 |
|
560,495 |
|
166,817 |
|
166,817 |
|
1,384 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Projects Under Development – Partially Owned: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Mozaic (a.k.a. Union Station) |
|
Los Angeles, CA |
|
272 |
|
69,661 |
|
64,852 |
|
42,757 |
|
39,787 |
|
98 |
% |
|
18 |
% |
|
11 |
% |
|
1Q 2007 |
|
1Q 2008 |
|
||||
|
Vintage |
|
Ontario, CA |
|
300 |
|
53,810 |
|
45,143 |
|
45,143 |
|
40,775 |
|
80 |
% |
|
22 |
% |
|
14 |
% |
|
3Q 2007 |
|
1Q 2008 |
|
||||
|
Silver Spring |
|
Silver Spring, MD |
|
457 |
|
147,454 |
|
40,684 |
|
40,684 |
|
— |
|
14 |
% |
|
— |
|
|
— |
|
|
4Q 2008 |
|
3Q 2010 |
|
||||
|
303 Third Street |
|
Cambridge, MA |
|
531 |
|
248,307 |
|
55,878 |
|
55,878 |
|
— |
|
7 |
% |
|
— |
|
|
— |
|
|
3Q 2008 |
|
1Q 2010 |
|
||||
|
City Lofts |
|
Chicago, IL |
|
278 |
|
71,109 |
|
13,848 |
|
13,848 |
|
— |
|
6 |
% |
|
— |
|
|
— |
|
|
3Q 2008 |
|
2Q 2009 |
|
||||
|
Alta Pacific (2) |
|
Irvine, CA |
|
132 |
|
46,416 |
|
21,790 |
|
21,790 |
|
28,260 |
|
22 |
% |
|
— |
|
|
— |
|
|
4Q 2007 |
|
3Q 2008 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Projects Under Development – Partially Owned |
|
|
|
1,970 |
|
636,757 |
|
242,195 |
|
220,100 |
|
108,822 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Projects Under Development |
|
|
|
3,448 |
|
1,197,252 |
|
409,012 |
|
386,917 |
|
110,206 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Land Held for Development |
|
|
|
N/A |
|
— |
|
254,227 |
|
254,227 |
|
50,332 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Land/Projects Held for and/or Under Development |
|
|
|
3,448 |
|
1,197,252 |
|
663,239 |
|
641,144 |
|
|
160,538 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Completed Not Stabilized: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
2400 M St (3) |
|
Washington, D.C. |
|
359 |
|
111,947 |
|
107,888 |
|
— |
|
75,936 |
|
100 |
% |
|
65 |
% |
|
58 |
% |
|
Completed |
|
3Q 2007 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Projects Completed Not Stabilized |
|
|
|
359 |
|
111,947 |
|
107,888 |
|
— |
|
75,936 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total Projects |
|
|
|
3,807 |
|
$ |
1,309,199 |
|
$ |
771,127 |
|
$ |
641,144 |
|
$ |
236,474 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Total capital cost represents estimated development cost for projects under development and all capitalized costs incurred to date plus any estimates of costs remaining to be funded for all projects, all in accordance with GAAP.
(2) Debt is primarily tax-exempt bonds that are entirely outstanding, with $18.8 million unfunded and classified as deposits - restricted in the consolidated balance sheets at 12/31/06.
(3) EQR acquired its partner’s interest on 4/28/2006 and now wholly-owns the property. Total Book Value to Date does not include additional purchase consideration of $30.7 million.
28
The Company is party to a housing discrimination lawsuit brought by a non-profit civil rights organization in April 2006 in the U.S. District Court for the District of Maryland. The suit alleges that the Company designed and built approximately 300 of its properties in violation of the accessibility requirements of the Fair Housing Act and Americans With Disabilities Act. The suit seeks actual and punitive damages, injunctive relief (including modification of non-compliant properties), costs and attorneys’ fees. The Company believes it has a number of viable defenses, including that a majority of the named properties were completed before the operative dates of the statutes in question and/or were not designed or built by the Company. Accordingly, the Company is defending the suit vigorously. Due to the pendency of the Company’s defenses and the uncertainty of many other critical factual and legal issues, it is not possible to determine or predict the outcome of the suit and as a result, no amounts have been accrued at December, 31, 2006. While no assurances can be given, the Company does not believe that the suit, if adversely determined, would have a material adverse effect on the Company.
The Company does not believe there is any other litigation pending or threatened against it that, individually or in the aggregate, reasonably may be expected to have a material adverse effect on the Company.
Item 4. Submission of Matters to a Vote of Security Holders
None.
29
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
The following table sets forth, for the years indicated, the high, low and closing sales prices for and the distributions paid on the Company’s Common Shares, which trade on the New York Stock Exchange under the trading symbol EQR.
|
|
|
Sales Price |
|
|
|
||||||||
|
|
|
High |
|
Low |
|
Closing |
|
Distributions |
|
||||
|
2006 |
|
|
|
|
|
|
|
|
|
||||
|
Fourth Quarter Ended December 31, 2006 |
|
$ |
61.50 |
|
$ |
49.42 |
|
$ |
50.75 |
|
$ |
0.4625 |
|
|
Third Quarter Ended September 30, 2006 |
|
$ |
51.35 |
|
$ |
44.04 |
|
$ |
50.58 |
|
$ |
0.4425 |
|
|
Second Quarter Ended June 30, 2006 |
|
$ |
47.47 |
|
$ |
41.45 |
|
$ |
44.73 |
|
$ |
0.4425 |
|
|
First Quarter Ended March 31, 2006 |
|
$ |
47.74 |
|
$ |
38.84 |
|
$ |
46.79 |
|
$ |
0.4425 |
|
|
|
|
Sales Price |
|
|
|
||||||||
|
|
|
High |
|
Low |
|
Closing |
|
Distributions |
|
||||
|
2005 |
|
|
|
|
|
|
|
|
|
||||
|
Fourth Quarter Ended December 31, 2005 |
|
$ |
42.17 |
|
$ |
35.52 |
|
$ |
39.12 |
|
$ |
0.4425 |
|
|
Third Quarter Ended September 30, 2005 |
|
$ |
40.74 |
|
$ |
36.35 |
|
$ |
37.85 |
|
$ |
0.4325 |
|
|
Second Quarter Ended June 30, 2005 |
|
$ |
37.57 |
|
$ |
31.50 |
|
$ |
36.82 |
|
$ |
0.4325 |
|
|
First Quarter Ended March 31, 2005 |
|
$ |
36.37 |
|
$ |
30.70 |
|
$ |
32.21 |
|
$ |
0.4325 |
|
The number of record holders of Common Shares at January 31, 2007 was approximately 4,000. The number of outstanding Common Shares as of January 31, 2007 was 294,015,767.
Certain information related to equity compensation plans is set forth in Item 8, Notes 14 and 15.
Item 6. Selected Financial Data
The following table sets forth selected financial and operating information on a historical basis for the Company. The following information should be read in conjunction with all of the financial statements and notes thereto included elsewhere in this Form 10-K. The historical operating and balance sheet data have been derived from the historical financial statements of the Company. All amounts have also been restated in accordance with the discontinued operations provisions of SFAS No. 144. Certain capitalized terms as used herein are defined in the Notes to Consolidated Financial Statements.
30
CONSOLIDATED HISTORICAL FINANCIAL INFORMATION
(Financial information in thousands except for per share and property data)
|
|
|
Year Ended December 31, |
|
|||||||||||||
|
|
|
2006 |
|
2005 |
|
2004 |
|
2003 |
|
2002 |
|
|||||
|
OPERATING DATA: |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Total revenues from continuing operations |
|
$ |
1,990,436 |
|
$ |
1,682,658 |
|
$ |
1,493,927 |
|
$ |
1,330,804 |
|
$ |
1,301,856 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Interest and other income |
|
$ |
31,131 |
|
$ |
68,399 |
|
$ |
8,765 |
|
$ |
15,581 |
|
$ |
13,947 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Income from continuing operations, net of minority interests |
|
$ |
100,532 |
|
$ |
147,323 |
|
$ |
88,778 |
|
$ |
98,966 |
|
$ |
104,689 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Discontinued operations, net of minority interests |
|
$ |
972,312 |
|
$ |
714,470 |
|
$ |
383,551 |
|
$ |
424,345 |
|
$ |
296,088 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Net income |
|
$ |
1,072,844 |
|
$ |
861,793 |
|
$ |
472,329 |
|
$ |
523,311 |
|
$ |
400,777 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Net income available to Common Shares |
|
$ |
1,031,766 |
|
$ |
807,792 |
|
$ |
418,583 |
|
$ |
426,639 |
|
$ |
324,162 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Earnings per share – basic: |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Income from continuing operations available to Common Shares |
|
$ |
0.21 |
|
$ |
0.33 |
|
$ |
0.13 |
|
$ |
0.01 |
|
$ |
0.10 |
|
|
Net income available to Common Shares |
|
$ |
3.56 |
|
$ |
2.83 |
|
$ |
1.50 |
|
$ |
1.57 |
|
$ |
1.19 |
|
|
Weighted average Common Shares outstanding |
|
290,019 |
|
285,760 |
|
279,744 |
|
272,337 |
|
271,974 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Earnings per share – diluted: |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Income from continuing operations available to Common Shares |
|
$ |
0.20 |
|
$ |
0.32 |
|
$ |
0.12 |
|
$ |
0.01 |
|
$ |
0.10 |
|
|
Net income available to Common Shares |
|
$ |
3.50 |
|
$ |
2.79 |
|
$ |
1.48 |
|
$ |
1.55 |
|
$ |
1.18 |
|
|
Weighted average Common Shares outstanding |
|
315,579 |
|
310,785 |
|
303,871 |
|
297,041 |
|
297,969 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Distributions declared per Common Share outstanding |
|
$ |
1.79 |
|
$ |
1.74 |
|
$ |
1.73 |
|
$ |
1.73 |
|
$ |
1.73 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
BALANCE SHEET DATA (at end of period): |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Real estate, before accumulated depreciation |
|
$ |
17,235,175 |
|
$ |
16,590,370 |
|
$ |
14,852,621 |
|
$ |
12,874,379 |
|
$ |
13,046,263 |
|
|
Real estate, after accumulated depreciation |
|
$ |
14,212,695 |
|
$ |
13,702,230 |
|
$ |
12,252,794 |
|
$ |
10,578,366 |
|
$ |
10,934,246 |
|
|
Total assets |
|
$ |
15,062,219 |
|
$ |
14,108,751 |
|
$ |
12,656,306 |
|
$ |
11,477,917 |
|
$ |
11,822,005 |
|
|
Total debt |
|
$ |
8,057,656 |
|
$ |
7,591,073 |
|
$ |
6,459,806 |
|
$ |
5,360,489 |
|
$ |
5,523,699 |
|
|
Minority Interests |
|
$ |
411,459 |
|
$ |
422,183 |
|
$ |
535,582 |
|
$ |
600,929 |
|
$ |
611,303 |
|
|
Shareholders’ equity |
|
$ |
5,884,222 |
|
$ |
5,395,340 |
|
$ |
5,072,528 |
|
$ |
5,015,441 |
|
$ |
5,197,123 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
OTHER DATA: |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Total properties (at end of period) |
|
617 |
|
926 |
|
939 |
|
968 |
|
1,039 |
|
|||||
|
Total apartment units (at end of period) |
|
165,716 |
|
197,404 |
|
200,149 |
|
207,506 |
|
223,591 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Funds from operations available to Common Shares and OP Units - basic (1)(2) |
|
$ |
716,143 |
|
$ |
784,625 |
|
$ |
651,741 |
|
$ |
640,390 |
|
$ |
719,265 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Cash flow provided by (used for): |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Operating activities |
|
$ |
755,466 |
|
$ |
698,531 |
|
$ |
707,061 |
|
$ |
744,319 |
|
$ |
888,263 |
|
|
Investing activities |
|
$ |
(259,472 |
) |
$ |
(592,201 |
) |
$ |
(555,279 |
) |
$ |
334,028 |
|
$ |
(48,622 |
) |
|
Financing activities |
|
$ |
(324,545 |
) |
$ |
(101,007 |
) |
$ |
(117,856 |
) |
$ |
(1,058,643 |
) |
$ |
(861,369 |
) |
(1) The National Association of Real Estate Investment Trusts (“NAREIT”) defines funds from operations (“FFO”) (April 2002 White Paper) as net income (computed in accordance with accounting principles generally accepted in the United States (“GAAP”)), excluding gains (or losses) from sales of depreciable property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect funds from operations on the same basis. The April 2002 White Paper states that gain or loss on sales of property is excluded from FFO for previously depreciated operating properties only. Once the Company commences the conversion of units to condominiums, it simultaneously discontinues depreciation of such property. See Item 7 for a reconciliation of net income to FFO.
(2) The Company believes that FFO is helpful to investors as a supplemental measure of the operating performance of a real estate company,
31
because it is a recognized measure of performance by the real estate industry and by excluding gains or losses related to dispositions of depreciable 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 compare the operating performance of a company’s real estate between periods or as compared to different companies. FFO in and of itself does not represent net income or net cash flows from operating activities in accordance with GAAP. Therefore, FFO should not be exclusively considered as an alternative to net income or to net cash flows from operating activities as determined by GAAP or as a measure of liquidity. The Company’s calculation of FFO may differ from other real estate companies due to, among other items, variations in cost capitalization policies for capital expenditures and, accordingly, may not be comparable to such other real estate companies.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Overview
The following discussion and analysis of the results of operations and financial condition of the Company should be read in connection with the Consolidated Financial Statements and Notes thereto. Due to the Company’s ability to control the Operating Partnership and its subsidiaries other than entities owning interests in the Partially Owned Properties - Unconsolidated and certain other entities in which the Company has investments, the Operating Partnership and each such subsidiary entity has been consolidated with the Company for financial reporting purposes. Capitalized terms used herein and not defined are as defined elsewhere in this Annual Report on Form 10-K for the year ended December 31, 2006.
Forward-looking statements in this Item 7 as well as elsewhere in this Annual Report on Form 10-K are intended to be made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations, estimates, projections and assumptions made by management. While the Company’s management believes the assumptions underlying its forward-looking statements are reasonable, such information is inherently subject to uncertainties and may involve certain risks, which could cause actual results, performance, or achievements of the Company to differ materially from anticipated future results, performance or achievements expressed or implied by such forward-looking statements. Many of these uncertainties and risks are difficult to predict and beyond management’s control. Forward-looking statements are not guarantees of future performance, results or events. The Company assumes no obligation to update or supplement forward-looking statements because of subsequent events. Factors that might cause such differences include, but are not limited to, the following:
• We intend to actively acquire and develop multifamily properties for rental operations and/or conversion into condominiums, as well as upgrade and sell existing properties as individual condominiums. We may underestimate the costs necessary to bring an acquired or development property up to standards established for its intended market position. Additionally, we expect that other major real estate investors with significant capital will compete with us for attractive investment opportunities or may also develop properties in markets where we focus our development efforts. This competition may increase prices for multifamily properties or decrease the price at which we expect to sell individual properties. We may not be in a position or have the opportunity in the future to make suitable property acquisitions on favorable terms. We also plan to develop more properties ourselves in addition to co-investing with our development partners for either the rental or condominium market, depending on opportunities in each sub-market. This may increase the overall level of risk associated with our developments. The total number of development units, cost of development and estimated completion dates are subject to uncertainties arising from changing economic conditions (such as the cost of labor and construction materials), competition and local government regulation.
• Sources of capital to the Company or labor and materials required for maintenance, repair, capital expenditure or development are more expensive than anticipated;
• Occupancy levels and market rents may be adversely affected by national and local economic and market conditions including, without limitation, new construction of multifamily housing, slow employment growth, availability of low interest mortgages for single-family home buyers and the potential for geopolitical instability, all of which are beyond the Company’s control;
32
and
• Additional factors as discussed in Part I of this Annual Report on Form 10-K, particularly those under “Risk Factors”.
Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to publicly release any revisions to these forward-looking statements, which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Forward-looking statements and related uncertainties are also included in Notes 5 and 11 to the Notes to Consolidated Financial Statements in this report.
Results of Operations
In conjunction with our business objectives and operating strategy, the Company has continued to invest or recycle its capital investment in apartment properties located in strategically targeted markets during the years ended December 31, 2006 and December 31, 2005. In summary, we:
Year Ended December 31, 2006:
• Acquired $1.8 billion of apartment properties consisting of 35 properties and 8,768 units, and $134.4 million of land parcels, all of which we deem to be in our strategic targeted markets; and
• Sold $2.3 billion of apartment properties consisting of 335 properties and 39,608 units, as well as 1,069 condominium units for $216.0 million and $1.6 million of land parcels.
Year Ended December 31, 2005:
• Acquired $2.5 billion of apartment properties consisting of 41 properties and 12,059 units, and $138.3 million of land parcels, all of which we deem to be in our strategic targeted markets; and
• Sold $1.4 billion of apartment properties consisting of 50 properties and 12,848 units, as well as 2,241 condominium units for $593.3 million and five land parcels for $108.3 million.
On June 28, 2006, the Company announced that it agreed to sell its Lexford Housing Division for a cash purchase price of $1.086 billion. The sale closed on October 5, 2006. The Lexford Housing Division results are classified as discontinued operations, net of minority interests, in the consolidated statements of operations for all periods presented. The Company recorded a gain on sale of approximately $418.7 million on the sale of the Lexford Housing Division in the fourth quarter of 2006. In conjunction with the Lexford disposition, the Company paid off/extinguished $196.3 million of mortgage notes payable secured by the properties and incurred approximately $9.2 million in prepayment penalties upon extinguishment.
The Company’s primary financial measure for evaluating each of its apartment communities is net operating income (“NOI”). NOI represents rental income less property and maintenance expense, real estate tax and insurance expense, and property management expense. The Company believes that NOI is helpful to investors as a supplemental measure of the operating performance of a real estate company because it is a direct measure of the actual operating results of the Company’s apartment communities.
Properties that the Company owned for all of both 2006 and 2005 (the “2006 Same Store Properties”), which represented 128,133 units, impacted the Company’s results of operations. Properties that the Company owned for all of both 2005 and 2004 (the “2005 Same Store Properties”), which represented 154,854 units, also impacted the Company’s results of operations. Both the 2006 Same Store Properties and 2005 Same Store Properties are discussed in the following paragraphs.
The Company’s acquisition, disposition, completed development and consolidation of previously unconsolidated property and variable interest entity activities also impacted overall results of operations for the years ended December 31, 2006 and 2005. The impacts of these activities are also discussed in greater
33
detail in the following paragraphs.
Comparison of the year ended December 31, 2006 to the year ended December 31, 2005
For the year ended December 31, 2006, income from continuing operations, net of minority interests, decreased by approximately $46.8 million when compared to the year ended December 31, 2005. The decrease in continuing operations is discussed below.
Revenues from the 2006 Same Store Properties increased $88.7 million primarily as a result of higher rental rates charged to residents. Expenses from the 2006 Same Store Properties increased $23.9 million primarily due to higher maintenance, payroll, utility costs and real estate taxes. The following tables provide comparative same store results and statistics for the 2006 Same Store Properties:
(1) Average rental rate is defined as total rental revenues divided by the weighted average occupied units for the period.
The following table presents a reconciliation of operating income per the consolidated statements of operations to NOI for the 2006 Same Store Properties.
|
|
|
Year Ended December 31, |
|
||||
|
|
|
2006 |
|
2005 |
|
||
|
|
|
(Amounts in thousands) |
|
||||
|
|
|
|
|
|
|
||
|
Operating income |
|
$ |
513,143 |
|
$ |
433,464 |
|
|
Adjustments: |
|
|
|
|
|
||
|
Non-same-store operating results |
|
(173,863 |
) |
(22,851 |
) |
||
|
Fee and asset management revenue |
|
(9,101 |
) |
(10,240 |
) |
||
|
Fee and asset management expense |
|
8,934 |
|
8,555 |
|
||
|
Depreciation |
|
562,739 |
|
439,594 |
|
||
|
General and administrative |
|
48,465 |
|
70,405 |
|
||
|
Impairment |
|
34,002 |
|
613 |
|
||
|
|
|
|
|
|
|
||
|
Same store NOI |
|
$ |
984,319 |
|
$ |
919,540 |
|
For properties that the Company acquired prior to January 1, 2006 and expects to continue to own through December 31, 2007, the Company anticipates the following same store results for the full year ending December 31, 2007:
34
|
2007 Same-Store Assumptions |
|||
|
Physical Occupancy |
|
95.0% |
|
|
Revenue Change |
|
5.00% to 6.00% |
|
|
Expense Change |
|
3.50% to 4.50% |
|
|
NOI Change |
|
5.50% to 7.50% |
|
These 2007 assumptions are based on current expectations and are forward-looking.
Non-same store operating results increased $151.0 million and consist primarily of properties acquired in calendar years 2006 and 2005 as well as our corporate housing business.
See also Note 20 in the Notes to Consolidated Financial Statements for additional discussion regarding the Company’s segment disclosures.
Fee and asset management revenues, net of fee and asset management expenses decreased $1.5 million primarily as a result of lower income earned from managing fewer properties for third parties and unconsolidated entities. As of December 31, 2006 and 2005, the Company managed 15,020 units and 16,269 units, respectively, for third parties and unconsolidated entities.
Property management expenses from continuing operations include off-site expenses associated with the self-management of the Company’s properties as well as management fees paid to any third party management companies. These expenses increased by approximately $9.3 million or 10.7%. This increase is primarily attributable to higher overall payroll costs and higher overall computer and training costs specific to the Company’s rollout of a new property management system.
Depreciation expense from continuing operations, which includes depreciation on non-real estate assets, increased $123.1 million primarily as a result of additional depreciation expense on newly acquired properties and capital expenditures for all properties owned.
General and administrative expenses, which include corporate operating expenses, decreased approximately $21.9 million between the periods under comparison. This decrease was primarily due to lower executive compensation expense due to severance costs for several executive officers incurred during the year ended December 31, 2005 and a $2.8 million reimbursement of legal expenses during the year ended December 31, 2006. The Company anticipates that general and administrative expenses will approximate $50.0 million to $52.0 million for the year ending December 31, 2007. The above assumption is based on current expectations and is forward-looking.
Impairment from continuing operations increased $33.4 million between periods under comparison. This increase was primarily due to an impairment charge on goodwill of $30.0 million related to the corporate housing business and $2.0 million related to the write-off of various deferred sales costs following the decision to halt the condominium conversion and sale process at five assets.
Interest and other income from continuing operations decreased by approximately $37.3 million, primarily as a result of the $57.1 million in cash received during the year ended December 31, 2005 for the Company’s ownership interest in Rent.com, which was acquired by eBay, Inc. This was partially offset by the $3.7 million in additional proceeds for Rent.com, an increase in interest earned on tax deferred 1031 exchange proceeds from the Lexford disposition and $14.7 million of forfeited deposits for various terminated transactions received during the year ended December 31, 2006.
Interest expense from continuing operations, including amortization of deferred financing costs, increased approximately $67.4 million primarily as a result of higher variable interest rates and overall debt levels outstanding. During the year ended December 31, 2006, the Company capitalized interest costs of approximately $20.7 million as compared to $13.7 million for the year ended December 31, 2005. This capitalization of interest primarily relates to consolidated projects under development. The effective interest cost on all indebtedness for the year ended December 31, 2006 was 6.21% as compared to 6.16% for the year ended December 31, 2005.
35
Loss from investments in unconsolidated entities increased approximately $1.1 million between the periods under comparison. This increase is primarily the result of consolidating previously unconsolidated properties as of January 1, 2006 as the result of EITF Issue No. 04-5. See Note 4 in the Notes to Consolidated Financial Statements for further discussion.
Net gain on sales of unconsolidated entities decreased $1.0 million, due to increased unconsolidated sales during the year ended December 31, 2005.
Net gain on sales of land parcels decreased $27.5 million, due to a large gain recorded on the sale of one land parcel during the year ended December 31, 2005.
Discontinued operations, net of minority interests, increased approximately $257.8 million between the periods under comparison. This increase is primarily the result of lower real estate net book values for properties sold during the year ended December 31, 2006 as compared to the same period in 2005. See Note 13 in the Notes to Consolidated Financial Statements for further discussion.
Comparison of the year ended December 31, 2005 to the year ended December 31, 2004
For the year ended December 31, 2005, income from continuing operations, net of minority interests, increased by approximately $58.5 million when compared to the year ended December 31, 2004. The increase in continuing operations is discussed below.
Revenues from the 2005 Same Store Properties increased $61.9 million primarily as a result of lower concessions provided residents and a slight increase in average occupancy rates. Expenses from the 2005 Same Store Properties increased $36.2 million primarily due to higher payroll, utility costs and real estate taxes. The following tables provide comparative revenue, expense, NOI and weighted average occupancy for the 2005 Same Store Properties:
(1) Year 2005 expenses exclude $11.1 million of uninsured property damage caused by Hurricane Wilma. Year 2004 expenses exclude $15.2 million of uninsured property damage caused by Hurricanes Charley, Frances, Ivan and Jeanne.
|
Same-Store Occupancy Statistics |
|||
|
|
|
|
|
|
Year 2005 |
|
94.1 |
% |
|
Year 2004 |
|
93.5 |
% |
|
Change |
|
0.6 |
% |
Non-same store operating results increased $78.6 million and consist primarily of properties acquired in calendar years 2005 and 2004 as well as our corporate housing business.
Fee and asset management revenues, net of fee and asset management expenses, decreased by $1.5 million primarily as a result of lower income earned from Ft. Lewis and managing fewer properties for third
36
parties and unconsolidated entities. As of December 31, 2005 and 2004, the Company managed 16,269 units and 17,988 units, respectively, for third parties and unconsolidated entities.
Property management expenses from continuing operations include off-site expenses associated with the self-management of the Company’s properties as well as management fees paid to any third party management companies. These expenses increased by approximately $10.2 million or 13.3%. This increase is primarily attributable to higher overall payroll costs including bonuses, long-term compensation costs and an increase of the Company’s match for employee 401(k) contributions.
Depreciation expense from continuing operations, which includes depreciation on non-real estate assets, increased $58.9 million primarily as a result of additional depreciation expense on newly acquired properties and capital expenditures for all properties involved.
General and administrative expenses, which include corporate operating expenses, increased approximately $23.3 million between the periods under comparison. This increase was primarily due to higher executive compensation expense due to severance costs of $9.8 million for several executive officers, $7.9 million of additional accruals specific to performance shares for selected executive officers and a $2.5 million profit sharing accrual paid in the first quarter of 2006.
Interest and other income from continuing operations increased approximately $59.6 million, primarily as a result of the $57.1 million in cash received for the Company’s ownership interest in Rent.com, which was acquired by eBay, Inc.
Interest expense from continuing operations, including amortization of deferred financing costs, increased approximately $55.3 million primarily as a result of higher overall debt balances as well as higher variable interest rates. During the year ended December 31, 2005, the Company capitalized interest costs of approximately $13.7 million as compared to $14.0 million for the year ended December 31, 2004. This capitalization of interest primarily relates to consolidated projects under development. The effective interest cost on all indebtedness for the year ended December 31, 2005 was 6.16% as compared to 5.87% for the year ended December 31, 2004.
(Loss) income from investments in unconsolidated entities increased approximately $7.8 million between the periods under comparison. This increase is primarily the result of consolidation of properties that were previously unconsolidated in the first quarter of 2004.
Net gain on sales of unconsolidated entities decreased $3.3 million, primarily due to a decrease in the number of unconsolidated entities sold.
Net gain on sales of land parcels increased $24.8 million, primarily due to an increase in the number of land parcels sold and large gains recorded on two land parcels located in Tyson’s Corner, Virginia.
Discontinued operations, net of minority interests, increased approximately $330.9 million between the periods under comparison. This increase is primarily the result of higher per unit sales prices and lower real estate net book values for properties sold during the year ended December 31, 2005 as compared to the same period in 2004 as well as higher condominium sales. The Company recognized $91.6 million and $32.1 million of net incremental gain on sales of condominium units (net of provision for income taxes) for the years ended December 31, 2005 and 2004, respectively.
Liquidity and Capital Resources
For the Year Ended December 31, 2006
As of January 1, 2006, the Company had approximately $88.8 million of cash and cash equivalents and $780.8 million available under its line of credit (net of $50.2 million which was restricted/dedicated to
37
support letters of credit and not available for borrowing). After taking into effect the various transactions discussed in the following paragraphs and the net cash provided by operating activities, the Company’s cash and cash equivalents balance at December 31, 2006 was approximately $260.3 million and the amount available on the Company’s revolving credit facilities was $470.7 million (net of $69.3 million which was restricted/dedicated to support letters of credit and not available for borrowing).
During the year ended December 31, 2006, the Company generated proceeds from various transactions, which included the following:
• Disposed of 340 properties, various individual condominium units and two land parcels, receiving net proceeds of approximately $2.3 billion;
• Obtained $395.5 million in net proceeds from the issuance of $400.0 million of ten and one-half year 5.375% fixed rate public notes and terminated six forward starting swaps designated to hedge the note issuance, receiving net proceeds of $10.7 million;
• Obtained $637.0 million in net proceeds from the issuance of $650.0 million of twenty year 3.85% exchangeable fixed rate public notes;
• Obtained $267.0 million in new mortgage financing; and
• Issued approximately 2.9 million Common Shares and received net proceeds of $77.7 million.
During the year ended December 31, 2006, the above proceeds were primarily utilized to:
• Invest $291.3 million primarily in development projects;
• Acquire 35 properties and nine land parcels, utilizing cash of $1.7 billion;
• Repurchase 1.9 million Common Shares utilizing cash of $83.2 million;
• Repay $493.0 million of mortgage loans;
• Repay $60.0 million of fixed rate public notes;
• Redeem the series G Preference Interests at a liquidation value of $25.5 million; and
• Redeem the Series C Preferred Shares at a liquidation value of $115.0 million.
Depending on its analysis of market prices, economic conditions, and other opportunities for the investment of available capital, the Company may repurchase its Common Shares pursuant to its existing share buyback program authorized by the Board of Trustees. The Company repurchased $83.2 million (1,897,912 shares at an average price per share of $43.85) of its Common Shares during the year ended December 31, 2006 to offset the issuance of 1,144,326 OP Units in connection with three property acquisitions and to partially offset restricted shares granted and ESPP shares purchased during the year ended December 31, 2006. The Company is authorized to repurchase approximately $501.8 million of additional Common Shares.
The Company’s total debt summary and debt maturity schedules as of December 31, 2006, are as follows:
38
Debt Summary as of December 31, 2006
(Amounts in thousands)
|
|
|
Amounts (1) |
|
% of Total |
|
Weighted
|
|
Weighted
|
|
|
|
Secured |
|
$ |
3,178,223 |
|
39.4 |
% |
5.82 |
% |
6.4 |
|
|
Unsecured |
|
4,879,433 |
|
60.6 |
% |
5.84 |
% |
6.6 |
|
|
|
Total |
|
$ |
8,057,656 |
|
100.0 |
% |
5.83 |
% |
6.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed Rate Debt: |
|
|
|
|
|
|
|
|
|
|
|
Secured – Conventional |
|
$ |
2,286,529 |
|
28.4 |
% |
6.30 |
% |
4.4 |
|
|
Secured – Tax Exempt |
|
18,260 |
|
0.2 |
% |
6.39 |
% |
18.3 |
|
|
|
Unsecured – Public/Private |
|
4,158,043 |
|
51.6 |
% |
5.90 |
% |
6.9 |
|
|
|
Unsecured – Tax Exempt |
|
111,390 |
|
1.4 |
% |
5.06 |
% |
22.3 |
|
|
|
Fixed Rate Debt |
|
6,574,222 |
|
81.6 |
% |
6.04 |
% |
6.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Floating Rate Debt: |
|
|
|
|
|
|
|
|
|
|
|
Secured – Conventional |
|
338,278 |
|
4.2 |
% |
6.31 |
% |
2.4 |
|
|
|
Secured – Tax Exempt |
|
535,156 |
|
6.6 |
% |
3.45 |
% |
17.4 |
|
|
|
Unsecured – Public |
|
150,000 |
|
1.9 |
% |
6.13 |
% |
2.4 |
|
|
|
Unsecured – Revolving Credit Facilities |
|
460,000 |
|
5.7 |
% |
5.40 |
% |
1.4 |
|
|
|
Floating Rate Debt |
|
1,483,434 |
|
18.4 |
% |
4.90 |
% |
7.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
8,057,656 |
|
100.0 |
% |
5.83 |
% |
6.5 |
|
(1) Net of the effect of any derivative instruments. Weighted average rates are for the year ended December 31, 2006.
Debt Maturity Schedule as of December 31, 2006
(Amounts in thousands)
|
Year |
|
Fixed
|
|
Floating
|
|
Total |
|
% of Total |
|
Weighted
Debt (1) |
|
Weighted
|
|
|||
|
2007 |
|
$ |
360,411 |
|
$ |
101,052 |
|
$ |
461,463 |
|
5.7 |
% |
6.34 |
% |
6.51 |
% |
|
2008 (2) |
|
520,499 |
|
489,335 |
|
1,009,834 |
|
12.5 |
% |
6.71 |
% |
6.17 |
% |
|||
|
2009 |
|
452,953 |
|
382,564 |
|
835,517 |
|
10.4 |
% |
6.37 |
% |
5.36 |
% |
|||
|
2010 |
|
279,323 |
|
— |
|
279,323 |
|
3.5 |
% |
7.05 |
% |
7.05 |
% |
|||
|
2011 (3) |
|
1,448,445 |
|
24,150 |
|
1,472,595 |
|
18.3 |
% |
5.52 |
% |
5.50 |
% |
|||
|
2012 |
|
558,396 |
|
— |
|
558,396 |
|
6.9 |
% |
6.48 |
% |
6.48 |
% |
|||
|
2013 |
|
567,355 |
|
— |
|
567,355 |
|
7.1 |
% |
5.93 |
% |
5.93 |
% |
|||
|
2014 |
|
504,141 |
|
34,460 |
|
538,601 |
|
6.7 |
% |
5.27 |
% |
5.26 |
% |
|||
|
2015 |
|
316,459 |
|
— |
|
316,459 |
|
3.9 |
% |
6.53 |
% |
6.53 |
% |
|||
|
2016 |
|
1,089,170 |
|
— |
|
1,089,170 |
|
13.5 |
% |
5.32 |
% |
5.32 |
% |
|||
|
2017+ |
|
477,070 |
|
451,873 |
|
928,943 |
|
11.5 |
% |
6.70 |
% |
5.88 |
% |
|||
|
Total |
|
$ |
6,574,222 |
|
$ |
1,483,434 |
|
$ |
8,057,656 |
|
100.0 |
% |
5.98 |
% |
5.82 |
% |
(1) Net of the effect of any derivative instruments. Weighted average rates are as of December 31, 2006.
(2) Includes $460.0 million outstanding on the Company’s $1.0 billion unsecured revolving credit facility, which matures on May 29, 2008.
(3) Includes $650.0 million of 3.85% convertible unsecured debt with a final maturity of 2026. The notes are callable by the Company on or after August 18, 2011. The notes are putable by the holders on August 18, 2011, August 15, 2016 and August 15, 2021.
39
The following table provides a summary of the Company’s unsecured debt as of December 31, 2006:
Unsecured Debt Summary as of December 31, 2006
(Amounts in thousands)
|
|
|
|
|
|
|
|
|
Unamortized |
|
|
|
|||
|
|
|
Coupon |
|
Due |
|
Face |
|
Premium/ |
|
Net |
|
|||
|
|
|
Rate |
|
Date |
|
Amount |
|
(Discount) |
|
Balance |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Fixed Rate Notes: |
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
7.625 |
% |
04/15/07 |
|
$ |
50,000 |
|
$ |
51 |
|
$ |
50,051 |
|
|
|
|
6.900 |
% |
08/01/07 |
|
50,000 |
|
(14 |
) |
49,986 |
|
|||
|
|
|
7.540 |
% |
09/01/07 |
(1) |
4,286 |
|
— |
|
4,286 |
|
|||
|
|
|
4.861 |
% |
11/30/07 |
|
50,000 |
|
— |
|
50,000 |
|
|||
|
|
|
7.500 |
% |
08/15/08 |
(1) |
130,000 |
|
— |
|
130,000 |
|
|||
|
|
|
4.750 |
% |
06/15/09 |
(2) |
300,000 |
|
(674 |
) |
299,326 |
|
|||
|
|
|
6.950 |
% |
03/02/11 |
|
300,000 |
|
3,632 |
|
303,632 |
|
|||
|
|
|
6.625 |
% |
03/15/12 |
|
400,000 |
|
(1,529 |
) |
398,471 |
|
|||
|
|
|
5.200 |
% |
04/01/13 |
|
400,000 |
|
(740 |
) |
399,260 |
|
|||
|
|
|
5.250 |
% |
09/15/14 |
|
500,000 |
|
(474 |
) |
499,526 |
|
|||
|
|
|
6.584 |
% |
04/13/15 |
|
300,000 |
|
(919 |
) |
299,081 |
|
|||
|
|
|
5.125 |
% |
03/15/16 |
|
500,000 |
|
(493 |
) |
499,507 |
|
|||
|
|
|
5.375 |
% |
08/01/16 |
|
400,000 |
|
(1,778 |
) |
398,222 |
|
|||
|
|
|
7.125 |
% |
10/15/17 |
|
150,000 |
|
(700 |
) |
149,300 |
|
|||
|
|
|
7.570 |
% |
08/15/26 |
|
140,000 |
|
— |
|
140,000 |
|
|||
|
|
|
3.850 |
% |
08/15/26 |
(3) |
650,000 |
|
(7,990 |
) |
642,010 |
|
|||
|
Floating Rate Adjustments |
|
|
|
|
(2) |
(150,000 |
) |
— |
|
(150,000 |
) |
|||
|
FAS 133 Adjustments - net |
|
|
|
|
(2) |
(4,615 |
) |
— |
|
(4,615 |
) |
|||
|
|
|
|
|
|
|
4,169,671 |
|
(11,628 |
) |
4,158,043 |
|
|||
|
Fixed Rate Tax Exempt Notes: |
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
4.750 |
% |
12/15/28 |
(1) |
35,600 |
|
— |
|
35,600 |
|
|||
|
|
|
5.200 |
% |
06/15/29 |
(1) |
75,790 |
|
— |
|
75,790 |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
111,390 |
|
— |
|
111,390 |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Floating Rate Notes: |
|
|
|
06/15/09 |
(2) |
150,000 |
|
— |
|
150,000 |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Revolving Credit Facilities: |
|
|
|
05/29/08 |
(4) |
460,000 |
|
— |
|
460,000 |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Total Unsecured Debt |
|
|
|
|
|
$ |
4,891,061 |
|
$ |
(11,628 |
) |
$ |
4,879,433 |
|
(1) Notes are private. All other unsecured debt is public.
(2) $150.0 million in fair value interest rate swaps converts 50% of the 4.750% Notes due June 15, 2009 to a floating interest rate.
(3) Convertible notes mature on August 15, 2026. The notes are callable by the Company on or after August 18, 2011. The notes are putable by the holders on August 18, 2011, August 15, 2016 and August 15, 2021.
(4) Represents amount outstanding on the Company’s $1.0 billion unsecured revolving credit facility.
As of February 28, 2007, an unlimited amount of debt securities remains available for issuance by the Operating Partnership under a registration statement that became automatically effective upon filing with the SEC in June 2006 (under SEC regulations enacted in 2005, the registration statement automatically expires on June 29, 2009 and does not contain a maximum issuance amount) and $956.5 million in equity securities
40
remains available for issuance by the Company under a registration statement the SEC declared effective in February 1998.
The Company’s “Consolidated Debt-to-Total Market Capitalization Ratio” as of December 31, 2006 is presented in the following table. The Company calculates the equity component of its market capitalization as the sum of (i) the total outstanding Common Shares and assumed conversion of all OP Units at the equivalent market value of the closing price of the Company’s Common Shares on the New York Stock Exchange; (ii) the “Common Share Equivalent” of all convertible preferred shares and preference interests/units; and (iii) the liquidation value of all perpetual preferred shares outstanding.
Capital Structure as of December 31, 2006
(Amounts in thousands except for share and per share amounts)
|
Secured Debt |
|
|
|
|
|
$ |
3,178,223 |
|
39.4 |
% |
|
|
|
|
Unsecured Debt |
|
|
|
|
|
4,419,433 |
|
54.9 |
% |
|
|
||
|
Lines of Credit |
|
|
|
|
|
460,000 |
|
5.7 |
% |
|
|
||
|
Total Debt |
|
|
|
|
|
$ |
8,057,656 |
|
100.0 |
% |
33.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Common Shares |
|
293,551,633 |
|
93.6 |
% |
|
|
|
|
|
|
||
|
OP Units |
|
19,914,583 |
|
6.4 |
% |
|
|
|
|
|
|
||
|
Total Shares & OP Units |
|
313,466,216 |
|
100.0 |
% |
|
|
|
|
|
|
||
|
Common Share Equivalents (see below) |
|
856,602 |
|
|
|
|
|
|
|
|
|
||
|
Total outstanding at quarter-end |
|
314,322,818 |
|
|
|
|
|
|
|
|
|
||
|
Common Share Price at December 31, 2006 |
|
$ |
50.75 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
15,951,883 |
|
97.7 |
% |
|
|
|
|
Perpetual Preferred Equity (see below) |
|
|
|
|
|
375,000 |
|
2.3 |
% |
|
|
||
|
Total Equity |
|
|
|
|
|
$ |
16,326,883 |
|
100.0 |
% |
67.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Total Market Capitalization |
|
|
|
|
|
$ |
24,384,539 |
|
|
|
100.0 |
% |
|
Convertible Preferred Equity as of December 31, 2006
(Amounts in thousands except for share and per share amounts)
|
Series |
|
Redemption
|
|
Outstanding
|
|
Liquidation
|
|
Annual
|
|
Annual
|
|
Weighted
|
|
Conversion
|
|
Common Share
|
|
|||
|
Preferred Shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
7.00% Series E |
|
11/1/98 |
|
434,816 |
|
$ |
10,871 |
|
$ |
1.75 |
|
$ |
761 |
|
|
|
1.1128 |
|
483,863 |
|
|
7.00% Series H |
|
6/30/98 |
|
28,134 |
|
703 |
|
1.75 |
|
49 |
|
|
|
1.4480 |
|
40,738 |
|
|||
|
Preference Interests: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
7.625% Series J |
|
12/14/06 |
|
230,000 |
|
11,500 |
|
3.8125 |
|
877 |
|
|
|
1.4108 |
|
324,484 |
|
|||
|
Junior Preference Units: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
8.00% Series B |
|
7/29/09 |
|
7,367 |
|
184 |
|
2.00 |
|
15 |
|
|
|
1.020408 |
|
7,517 |
|
|||
|
Total Convertible Preferred Equity |
|
|
|
700,317 |
|
$ |
23,258 |
|
|
|
$ |
1,702 |
|
7.32 |
% |
|
|
856,602 |
|
|
Perpetual Preferred Equity as of December 31, 2006
(Amounts in thousands except for share and per share amounts)
|
Series |
|
Redemption
|
|
Outstanding
|
|
Liquidation
|
|
Annual
|
|
Annual
|
|
Weighted
|
|
|||
|
Preferred Shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
8.60% Series D |
|
7/15/07 |
|
700,000 |
|
$ |
175,000 |
|
$ |
21.50 |
|
$ |
15,050 |
|
|
|
|
8.29% Series K |
|
12/10/26 |
|
1,000,000 |
|
50,000 |
|
4.145 |
|
4,145 |
|
|
|
|||
|
6.48% Series N |
|
6/19/08 |
|
600,000 |
|
150,000 |
|
16.20 |
|
9,720 |
|
|
|
|||
|
Total Perpetual Preferred Equity |
|
|
|
2,300,000 |
|
$ |
375,000 |
|
|
|
$ |
28,915 |
|
7.71 |
% |
|
The Company expects to meet its short-term liquidity requirements, including capital expenditures related to maintaining its existing properties and certain scheduled unsecured note and mortgage note repayments, generally through its working capital, net cash provided by operating activities and borrowings
41
under its revolving credit facilities. The Company considers its cash provided by operating activities to be adequate to meet operating requirements and payments of distributions. The Company also expects to meet its long-term liquidity requirements, such as scheduled unsecured note and mortgage debt maturities, property acquisitions, financing of construction and development activities and capital improvements through the issuance of unsecured notes and equity securities, including additional OP Units, and proceeds received from the disposition of certain properties. In addition, the Company has significant unencumbered properties available to secure additional mortgage borrowings in the event that the public capital markets are unavailable or the cost of alternative sources of capital is too high. The fair value of and cash flow from these unencumbered properties are in excess of the requirements the Company must maintain in order to comply with covenants under its unsecured notes and line of credit. Of the $17.2 billion in investment in real estate on the Company’s balance sheet at December 31, 2006, $11.6 billion or 67.0%, was unencumbered.
The Operating Partnership’s senior debt credit ratings from Standard & Poors (“S&P”), Moody’s and Fitch are A-, Baal (positive outlook) and A, respectively. The Company’s preferred equity ratings from S&P, Moody’s and Fitch are BBB+, Baa2 (positive outlook) and A-, respectively.
The Operating Partnership has a long-term revolving credit facility with potential borrowings of up to $1.0 billion which matures in May 2008. This facility may, among other potential uses, be used to fund property acquisitions, costs for certain properties under development and short term liquidity requirements. As of February 26, 2007, $740.0 million was outstanding under this facility.
See Note 21 in the Notes to Consolidated Financial Statements for discussion of the events which occurred subsequent to December 31, 2006.
Capitalization of Fixed Assets and Improvements to Real Estate
Our policy with respect to capital expenditures is generally to capitalize expenditures that improve the value of the property or extend the useful life of the component asset of the property. We track improvements to real estate in two major categories and several subcategories:
• Replacements (inside the unit) . These include:
• flooring such as carpets, hardwood, vinyl, linoleum or tile;
• appliances;
• mechanical equipment such as individual furnace/air units, hot water heaters, etc;
• furniture and fixtures such as kitchen/bath cabinets, light fixtures, ceiling fans, sinks, tubs, toilets, mirrors, countertops, etc; and
• blinds/shades.
All replacements are depreciated over a five-year estimated useful life. We expense as incurred all make-ready maintenance and turnover costs such as cleaning, interior painting of individual units and the repair of any replacement item noted above.
• Building improvements ( outside the unit ). These include:
• roof replacement and major repairs;
• paving or major resurfacing of parking lots, curbs and sidewalks;
• amenities and common areas such as pools, exterior sports and playground equipment, lobbies, clubhouses, laundry rooms, alarm and security systems and offices;
• major building mechanical equipment systems;
• interior and exterior structural repair and exterior painting and siding;
• major landscaping and grounds improvement; and
• vehicles and office and maintenance equipment.
All building improvements are depreciated over a five to ten-year estimated useful life. We capitalize building improvements and upgrades only if the item: (i) exceeds $2,500 (selected projects must exceed
42
$10,000); (ii) extends the useful life of the asset; and (iii) improves the value of the asset.
For the year ended December 31, 2006, our actual improvements to real estate totaled approximately $255.2 million. This includes the following (amounts in thousands except for unit and per unit amounts):
Capitalized Improvements to Real Estate
For the Year Ended December 31, 2006
|
|
|
Total Units
|
|
Replacements |
|
Avg.
|
|
Building
|
|
Avg.
|
|
Total |
|
Avg.
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Established Properties (2) |
|
115,152 |
|
$ |
46,094 |
|
$ |
400 |
|
$ |
81,127 |
|
$ |
705 |
|
$ |
127,221 |
|
$ |
1,105 |
|
|
New Acquisition Properties (3) |
|
29,512 |
|
9,194 |
|
336 |
|
35,854 |
|
1,311 |
|
45,048 |
|
1,647 |
|
||||||
|
Other (4) |
|
6,651 |
|
30,384 |
|
|
|
52,527 |
|
|
|
82,911 |
|
|
|
||||||
|
Total |
|
151,315 |
|
$ |
85,672 |
|
|
|
$ |
169,508 |
|
|
|
$ |
255,180 |
|
|
|
|||
(1) Total units exclude 10,846 unconsolidated units and 3,555 military housing (fee managed) units.
(2) Wholly Owned Properties acquired prior to January 1, 2004.
(3) Wholly Owned Properties acquired during 2004, 2005 and 2006. Per unit amounts are based on a weighted average of 27,346 units.
(4) Includes properties either Partially Owned or sold during the period, commercial space, condominium conversions and $21.4 million included in building improvements spent on seventeen specific assets related to major renovations and repositioning of these assets.
For the year ended December 31, 2005, our actual improvements to real estate totaled approximately $232.5 million. This includes the following (amounts in thousands except for unit and per unit amounts):
Capitalized Improvements to Real Estate
For the Year Ended December 31, 2005
|
|
|
Total Units
|
|
Replacements |
|
Avg.
|
|
Building
|
|
Avg.
|
|
Total |
|
Avg.
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Established Properties (2) |
|
145,305 |
|
$ |
55,508 |
|
$ |
382 |
|
$ |
89,252 |
|
$ |
614 |
|
$ |
144,760 |
|
$ |
996 |
|
|
New Acquisition Properties (3) |
|
27,669 |
|
5,626 |
|
270 |
|
19,508 |
|
937 |
|
25,134 |
|
1,207 |
|
||||||
|
Other (4) |
|
8,531 |
|
23,421 |
|
|
|
39,185 |
|
|
|
62,606 |
|
|
|
||||||
|
Total |
|
181,505 |
|
$ |
84,555 |
|
|
|
$ |
147,945 |
|
|
|
$ |
232,500 |
|
|
|
|||
(1) Total units exclude 15,899 unconsolidated units.
(2) Wholly Owned Properties acquired prior to January 1, 2003.
(3) Wholly Owned Properties acquired during 2003, 2004 and 2005. Per unit amounts are based on a weighted average of 20,828 units.
(4) Includes properties either Partially Owned or sold during the period, commercial space, condominium conversions and $6.8 million included in building improvements spent on nine specific assets related to major renovations and repositioning of these assets.
The Company expects to fund approximately $145.0 million for capital expenditures for replacements and building improvements for all consolidated properties, exclusive of condominium conversion properties, in 2007. This includes an average of approximately $1,000 per unit for capital improvements for established properties.
During the year ended December 31, 2006, the Company’s total non-real estate capital additions, such as computer software, computer equipment, and furniture and fixtures and leasehold improvements to the Company’s property management offices and its corporate offices, were approximately $10.7 million. The
43
Company expects to fund approximately $8.2 million in total additions to non-real estate property in 2007.
Improvements to real estate and additions to non-real estate property were funded from net cash provided by operating activities.
Derivative Instruments
In the normal course of business, the Company is exposed to the effect of interest rate changes. The Company limits these risks by following established risk management policies and procedures including the use of derivatives to hedge interest rate risk on debt instruments.
The Company has a policy of only entering into contracts with major financial institutions based upon their credit ratings and other factors. When viewed in conjunction with the underlying and offsetting exposure that the derivatives are designed to hedge, the Company has not sustained a material loss from those instruments nor does it anticipate any material adverse effect on its net income or financial position in the future from the use of derivatives.
See Note 11 in the Notes to Consolidated Financial Statements for additional discussion of derivative instruments at December 31, 2006.
Other
Minority Interests as of December 31, 2006 decreased by $10.7 million when compared to December 31, 2005. The primary factors that impacted this account in the Company’s consolidated statements of operations and balance sheets during the year ended December 31, 2006 were:
• The redemption or repurchase of 1.0 million units of Series G, H and I Preference Interests with a combined liquidation value of $48.5 million and a premium on redemption of $0.7 million (see Note 3 in the Notes to Consolidated Financial Statements for further discussion);
• Distributions declared to Minority Interests, which amounted to $36.2 million (excluding Junior Preference Unit and Preference Interest distributions);
• The allocation of income from operations to holders of OP Units in the amount of $72.6 million;
• The issuance of 1,144,326 OP Units for the acquisition of three properties with a valuation of $49.6 million; and
• The conversion of 1.7 million OP Units into Common Shares valued at $27.9 million.
Total distributions paid in January 2007 amounted to $152.4 million (excluding distributions on Partially Owned Properties), which included certain distributions declared during the fourth quarter ended December 31, 2006.
44
Off-Balance Sheet Arrangements and Contractual Obligations
The Company has co-invested in various properties that are unconsolidated and accounted for under the equity method of accounting. Management does not believe these investments have a materially different impact upon the Company’s liquidity, capital resources, credit or market risk than its property management and ownership activities. During 2000 and 2001, the Company entered into institutional ventures with an unaffiliated partner. At the respective closing dates, the Company sold and/or contributed 45 properties containing 10,846 units to these ventures and retained a 25% ownership interest in the ventures. The Company’s joint venture partner contributed cash equal to 75% of the agreed-upon equity value of the properties comprising the ventures, which was then distributed to the Company. The Company’s strategy with respect to these ventures was to reduce its concentration of properties in a variety of markets.
As of December 31, 2006, the Company has 11 projects totaling 3,448 units in various stages of development with estimated completion dates ranging through June 30, 2009. The development agreements currently in place are discussed in detail in Note 18 of the Company’s Consolidated Financial Statements.
See also Notes 2 and 6 in the Notes to Consolidated Financial Statements for additional discussion regarding the Company’s investments in partially owned entities.
The following table summarizes the Company’s contractual obligations for the next five years and thereafter as of December 31, 2006:
|
|
|
Payments Due by Year (in thousands) |
|
|||||||||||||||||||
|
Contractual Obligations |
|
2007 |
|
2008 |
|
2009 |
|
2010 |
|
2011 |
|
Thereafter |
|
Total |
|
|||||||
|
Debt (a) |
|
$ |
461,463 |
|
$ |
1,009,834 |
|
$ |
835,517 |
|
$ |
279,323 |
|
$ |
1,472,595 |
|
$ |
3,998,924 |
|
$ |
8,057,656 |
|
|
Operating Leases: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Minimum Rent Payments (b) |
|
5,443 |
|
5,302 |
|
4,709 |
|
4,119 |
|
2,416 |
|
2,963 |
|
24,952 |
|
|||||||
|
Other Long-Term Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Deferred Compensation (c) |
|
813 |
|
813 |
|
1,450 |
|
1,450 |
|
2,049 |
|
14,736 |
|
21,311 |
|
|||||||
|
Total |
|
$ |
467,719 |
|
$ |
1,015,949 |
|
$ |
841,676 |
|
$ |
284,892 |
|
$ |
1,477,060 |
|
$ |
4,016,623 |
|
$ |
8,103,919 |
|
(a) Amounts include aggregate principal payments only. The Company paid $465,388, $397,886 and $348,574 for interest on debt, inclusive of derivative instruments, for the years ended December 31, 2006, 2005 and 2004, respectively.
(b) Minimum basic rent due for various office space the Company leases and fixed base rent due on a ground lease for one property.
(c) Estimated payments to the Company’s Chairman, two former CEO’s and its chief operating officer based on planned retirement dates.
Critical Accounting Policies and Estimates
The Company’s significant accounting policies are described in Note 2 in the Notes to Consolidated Financial Statements. These policies were followed in preparing the consolidated financial statements at and for the year ended December 31, 2006 and are consistent with the year ended December 31, 2005.
The Company has identified six significant accounting policies as critical accounting policies. These critical accounting policies are those that have the most impact on the reporting of our financial condition and those requiring significant judgments and estimates. With respect to these critical accounting policies, management believes that the application of judgments and assessments is consistently applied and produces financial information that fairly presents the results of operations for all periods presented. The six critical accounting policies are:
Impairment of Long-Lived Assets, Including Goodwill
The Company periodically evaluates its long-lived assets, including its investments in real estate and goodwill, for indicators of permanent impairment. The judgments regarding the existence of impairment indicators are based on factors such as operational performance, market conditions, expected
45
holding period of each asset and legal and environmental concerns. Future events could occur which would cause the Company to conclude that impairment indicators exist and an impairment loss is warranted.
Depreciation of Investment in Real Estate
The Company depreciates the building component of its investment in real estate over a 30-year estimated useful life, building improvements over a 5-year to 10-year estimated useful life and both the furniture, fixtures and equipment and replacements components over a 5-year estimated useful life, all of which are judgmental determinations.
Cost Capitalization
See the Capitalization of Fixed Assets and Improvements to Real Estate section for discussion of the policy with respect to capitalization vs. expensing of fixed asset/repair and maintenance costs. In addition, the Company capitalizes the payroll and associated costs of employees directly responsible for and who spend all of their time on the supervision of major capital and/or renovation projects. These costs are reflected on the balance sheet as an increase to depreciable property.
The Company follows the guidance in SFAS No. 67, Accounting for Costs and Initial Rental Operations of Real Estate Projects , for all development projects and uses its professional judgment in determining whether such costs meet the criteria for capitalization or must be expensed as incurred. The Company capitalizes interest, real estate taxes and insurance and payroll and associated costs for those individuals directly responsible for and who spend all of their time on development activities, with capitalization ceasing no later than 90 days following issuance of the certificate of occupancy. These costs are reflected on the balance sheet as construction in progress for each specific property. The Company expenses as incurred all payroll costs of on-site employees working directly at our properties, except as noted above on our development properties prior to certificate of occupancy issuance and on specific major renovation at selected properties when additional incremental employees are hired.
Fair Value of Financial Instruments, Including Derivative Instruments
The valuation of financial instruments under SFAS No. 107 and SFAS No. 133 and its amendments (SFAS Nos. 137/138/149) requires the Company to make estimates and judgments that affect the fair value of the instruments. The Company, where possible, bases the fair values of its financial instruments, including its derivative instruments, on listed market prices and third party quotes. Where these are not available, the Company bases its estimates on current instruments with similar terms and maturities or on other factors relevant to the financial instruments.
Revenue Recognition
Rental income attributable to leases is recorded when due from residents and is recognized monthly as it is earned, which is not materially different than on a straight-line basis. Leases entered into between a resident and a property for the rental of an apartment unit are generally year-to-year, renewable upon consent of both parties on an annual or monthly basis. Fee and asset management revenue and interest income are recorded on an accrual basis.
Share-Based Compensation
The Company accounts for its share-based compensation in accordance with SFAS No. 123 (R), Share-Based Payment , effective January 1, 2006, which results in compensation expense being recorded based on the fair value of the share compensation granted.
The Black-Scholes option valuation model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. This model is only one method
46
of valuing options and the Company’s use of this model should not be interpreted as an endorsement of its accuracy. Because the Company’s share options have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management’s opinion, the existing models do not necessarily provide a reliable single measure of the fair value of its share options and the actual value of the options may be significantly different.
Funds From Operations
For the year ended December 31, 2006, Funds From Operations (“FFO”) available to Common Shares and OP Units decreased $68.5 million, or 8.7%, as compared to the year ended December 31, 2005. For the year ended December 31, 2005, FFO available to Common Shares and OP Units increased $132.9 million, or 20.4%, as compared to the year ended December 31, 2004.
The following is a reconciliation of net income to FFO available to Common Shares and OP Units for each of the five years ended December 31, 2006:
Funds From Operations
(Amounts in thousands)
|
|
|
Year Ended December 31, |
|
|||||||||||||
|
|
|
2006 |
|
2005 |
|
2004 |
|
2003 |
|
2002 |
|
|||||
|
Net income |
|
$ |
1,072,844 |
|
$ |
861,793 |
|
$ |
472,329 |
|
$ |
523,311 |
|
$ |
400,777 |
|
|
Allocation to Minority Interests – Operating Partnership, net |
|
4,201 |
|
6,796 |
|
2,624 |
|
202 |
|
2,335 |
|
|||||
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Depreciation |
|
562,739 |
|
439,594 |
|
380,673 |
|
325,471 |
|
303,871 |
|
|||||
|
Depreciation – Non-real estate additions |
|
(7,840 |
) |
(5,541 |
) |
(5,303 |
) |
(6,774 |
) |
(9,029 |
) |
|||||
|
Depreciation – Partially Owned and Unconsolidated Properties |
|
4,338 |
|
2,487 |
|
1,903 |
|
19,911 |
|
12,166 |
|
|||||
|
Net gain on sales of unconsolidated entities |
|
(370 |
) |
(1,330 |
) |
(4,593 |
) |
(4,942 |
) |
(5,054 |
) |
|||||
|
Discontinued operations: |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Depreciation |
|
29,779 |
|
89,153 |
|
115,639 |
|
145,853 |
|
168,901 |
|
|||||
|
Gain on sales of discontinued operations, net of minority interests (3) |
|
(955,863 |
) |
(650,563 |
) |
(296,343 |
) |
(287,372 |
) |
(96,317 |
) |
|||||
|
Net incremental gain on sales of condominium units |
|
45,800 |
|
91,611 |
|
32,054 |
|
10,280 |
|
1,682 |
|
|||||
|
Minority Interests – Operating Partnership |
|
1,593 |
|
4,626 |
|
6,504 |
|
11,122 |
|
16,548 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
FFO (1)(2) |
|
757,221 |
|
838,626 |
|
705,487 |
|
737,062 |
|
795,880 |
|
|||||
|
Preferred distributions |
|
(37,113 |
) |
(49,642 |
) |
(53,746 |
) |
(76,435 |
) |
(76,615 |
) |
|||||
|
Premium on redemption of Preferred Shares |
|
(3,965 |
) |
(4,359 |
) |
— |
|
(20,237 |
) |
— |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
FFO available to Common Shares and OP Units |
|
$ |
716,143 |
|
$ |
784,625 |
|
$ |
651,741 |
|
$ |
640,390 |
|
$ |
719,265 |
|
(1) The National Association of Real Estate Investment Trusts (“NAREIT”) defines funds from operations (“FFO”) (April 2002 White Paper) as net income (computed in accordance with accounting principles generally accepted in the United States (GAAP)), excluding gains (or losses) from sales of depreciable property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect funds from operations on the same basis. The April 2002 White Paper states that gain or loss on sales of property is excluded from FFO for previously depreciated operating properties only. Once the Company commences the conversion of units to condominiums, it simultaneously discontinues depreciation of such property.
(2) The Company believes that FFO is helpful to investors as a supplemental measure of the operating performance of a real estate company, because it is a recognized measure of performance by the real estate industry and by excluding gains or losses related to dispositions of depreciable 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 compare the operating performance of a company’s real estate between periods or as compared to different companies. FFO in and of itself does not represent net income or net cash flows from operating activities in accordance with GAAP. Therefore, FFO should not be exclusively considered as an
47
alternative to net income or to net cash flows from operating activities as determined by GAAP or as a measure of liquidity. The Company’s calculation of FFO may differ from other real estate companies due to, among other items, variations in cost capitalization policies for capital expenditures and, accordingly, may not be comparable to such other real estate companies.
(3) Gain on sales of discontinued operations, net of minority interests, has been reduced by approximately $4.5 million in one-time accrued retention benefits for the year ended December 31, 2006, related to the previously announced October 5, 2006 closing of the Lexford Housing Division disposition.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
Market risks relating to the Company’s financial instruments result primarily from changes in short-term LIBOR interest rates. The Company does not have any direct foreign exchange or other significant market risk.
The Company’s exposure to market risk for changes in interest rates relates primarily to the unsecured revolving credit facilities. The Company typically incurs fixed rate debt obligations to finance acquisitions and capital expenditures, while it typically incurs floating rate debt obligations to finance working capital needs and as a temporary measure in advance of securing long-term fixed rate financing. The Company continuously evaluates its level of floating rate debt with respect to total debt and other factors, including its assessment of the current and future economic environment.
The Company also utilizes certain derivative financial instruments to limit market risk. Interest rate protection agreements are used to convert floating rate debt to a fixed rate basis or vice versa. Derivatives are used for hedging purposes rather than speculation. The Company does not enter into financial instruments for trading purposes. See also Note 11 to the Notes to Consolidated Financial Statements for additional discussion of derivative instruments.
The fair values of the Company’s financial instruments (including such items in the financial statement captions as cash and cash equivalents, other assets, lines of credit, accounts payable and accrued expenses, rents received in advance and other liabilities) approximate their carrying or contract values based on their nature, terms and interest rates that approximate current market rates. The fair value of the Company’s mortgage notes payable and unsecured notes were approximately $3.2 billion and $4.5 billion, respectively, at December 31, 2006.
The Company had total outstanding floating rate debt of approximately $1.5 billion, or 18.4% of total debt at December 31, 2006, net of the effects of any derivative instruments. If market rates of interest on all of the floating rate debt permanently increased by 49 basis points (a 10% increase from the Company’s existing weighted average interest rates), the increase in interest expense on the floating rate debt would decrease future earnings and cash flows by approximately $7.3 million. If market rates of interest on all of the floating rate debt permanently decreased by 49 basis points (a 10% decrease from the Company’s existing weighted average interest rates), the decrease in interest expense on the floating rate debt would increase future earnings and cash flows by approximately $7.3 million.
At December 31, 2006, the Company had total outstanding fixed rate debt of approximately $6.6 billion, net of the effects of any derivative instruments. If market rates of interest permanently increased by 60 basis points (a 10% increase from the Company’s existing weighted average interest rates), the estimated fair value of the Company’s fixed rate debt would be approximately $6.0 billion. If market rates of interest permanently decreased by 60 basis points (a 10% decrease from the Company’s existing weighted average interest rates), the estimated fair value of the Company’s fixed rate debt would be approximately $7.3 billion.
At December 31, 2006, the Company’s derivative instruments had a net liability fair value of approximately $16.2 million. If market rates of interest permanently increased by 54 basis points (a 10% increase from the Company’s existing weighted average interest rates), the net liability fair value of the Company’s derivative instruments would be approximately $16.4 million. If market rates of interest
48
permanently decreased by 54 basis points (a 10% decrease from the Company’s existing weighted average interest rates), the net liability fair value of the Company’s derivative instruments would be approximately $16.2 million.
The Company had total outstanding floating rate debt of approximately $1.9 billion, or 24.9% of total debt at December 31, 2005, net of the effects of any derivative instruments. If market rates of interest on all of the floating rate debt permanently increased by 37 basis points (a 10% increase from the Company’s existing weighted average interest rates), the increase in interest expense on the floating rate debt would decrease future earnings and cash flows by approximately $7.1 million. If market rates of interest on all of the floating rate debt permanently decreased by 37 basis points (a 10% decrease from the Company’s existing weighted average interest rates), the decrease in interest expense on the floating rate debt would increase future earnings and cash flows by approximately $7.1 million.
At December 31, 2005, the Company had total outstanding fixed rate debt of approximately $5.7 billion, net of the effects of any derivative instruments. If market rates of interest permanently increased by 63 basis points (a 10% increase from the Company’s existing weighted average interest rates), the estimated fair value of the Company’s fixed rate debt would be approximately $5.2 billion. If market rates of interest permanently decreased by 63 basis points (a 10% decrease from the Company’s existing weighted average interest rates), the estimated fair value of the Company’s fixed rate debt would be approximately $6.3 billion.
At December 31, 2005, the Company’s derivative instruments had a net liability fair value of approximately $6.0 million. If market rates of interest permanently increased by 49 basis points (a 10% increase from the Company’s existing weighted average interest rates), the net liability fair value of the Company’s derivative instruments would be approximately $0.1 million. If market rates of interest permanently decreased by 49 basis points (a 10% decrease from the Company’s existing weighted average interest rates), the net liability fair value of the Company’s derivative instruments would be approximately $11.5 million.
These amounts were determined by considering the impact of hypothetical interest rates on the Company’s financial instruments. The foregoing assumptions apply to the entire amount of the Company’s debt and derivative instruments and do not differentiate among maturities. These analyses do not consider the effects of the changes in overall economic activity that could exist in such an environment. Further, in the event of changes of such magnitude, management would likely take actions to further mitigate its exposure to the changes. However, due to the uncertainty of the specific actions that would be taken and their possible effects, this analysis assumes no changes in the Company’s financial structure or results.
The Company cannot predict the effect of adverse changes in interest rates on its debt and derivative instruments and, therefore, its exposure to market risk, nor can there be any assurance that long term debt will be available at advantageous pricing. Consequently, future results may differ materially from the estimated adverse changes discussed above.
Item 8. Financial Statements and Supplementary Data
See Index to Consolidated Financial Statements on page F-1 of this Form 10-K.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 9A. Controls and Procedures
(a) Evaluation of Disclosure Controls and Procedures:
Effective as of December 31, 2006, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the Company’s disclosure controls and procedures
49
pursuant to Exchange Act Rules 13a-15 and 15d-15. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in its Exchange Act filings is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.
(b) Management’s Report on Internal Control over Financial Reporting:
Equity Residential’s management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) under the Exchange Act. Under the supervision and with the participation of management, including the Company’s Chief Executive Officer and Chief Financial Officer, management conducted an evaluation of the effectiveness of internal control over financial reporting based on the framework in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can only provide reasonable assurance with respect to financial statement preparation and presentation.
Based on the Company’s evaluation under the framework in Internal Control – Integrated Framework, management concluded that its internal control over financial reporting was effective as of December 31, 2006. Management’s assessment of the effectiveness of internal control over financial reporting as of December 31, 2006 has been audited by Ernst & Young LLP, an independent registered public accounting firm, as stated in their report which is included herein at Item 8, page F-3.
(c) Changes in Internal Control over Financial Reporting:
There were no changes to the internal control over financial reporting of the Company identified in connection with the Company’s evaluation referred to above that occurred during the fourth quarter of 2006 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
None.
50
Trustees, Executive Officers and Corporate Governance; Executive Compensation; Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters; Certain Relationships and Related Transactions, and Trustee Independence; and Principal Accounting Fees and Services.
The information required by Item 10, Item 11, Item 12, Item 13 and Item 14 is incorporated by reference to, and will be contained in, the Company’s definitive proxy statement, which the Company anticipates will be filed no later than April 20, 2007, and thus these items have been omitted in accordance with General Instruction G(3) to Form 10-K.
51
Item 15. Exhibits and Financial Statement Schedules.
(a) The following documents are filed as part of the Report:
(1) Financial Statements: See Index to Financial Statements and Schedule on page F-1 of this Form 10-K.
(2) Exhibits: See the Exhibit Index.
(3) Financial Statement Schedules: See Index to Financial Statements attached hereto on page F-1 of this Form 10-K.
52
Pursuant to the requirements of Section 13 or 15(d) 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.
|
|
EQUITY RESIDENTIAL |
|||||
|
|
|
|||||
|
|
|
|||||
|
|
By: |
/s/ David J. Neithercut |
|
|||
|
|
|
David J. Neithercut, President and |
||||
|
|
|
Chief Executive Officer |
|
|||
|
|
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|||||
|
|
Date: |
February 28, 2007 |
|
|||
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below, hereby constitutes and appoints David J. Neithercut, Donna Brandin and Ian S. Kaufman, or any of them, his attorneys-in-fact and agents, with full power of substitution and resubstitution for him in any and all capacities, to do all acts and things which said attorneys and agents, or any of them, deem advisable to enable the Company to comply with the Securities Exchange Act of 1934, as amended, and any requirements or regulations of the Securities and Exchange Commission in respect thereof, in connection with the Company’s filing of an annual report on Form 10-K for the Company’s fiscal year 2006, including specifically, but without limitation of the general authority hereby granted, the power and authority to sign his name as a director or officer, or both, of the Company, as indicated below opposite his signature, to the Form 10-K, and any amendment thereto; and each of the undersigned does hereby fully ratify and confirm all that said attorneys and agents, or any of them, or the substitute of any of them, shall do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities set forth below and on the dates indicated:
|
Name |
|
Title |
|
Date |
|||||
|
|
|
|
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|||||
|
/s/ David J. Neithercut |
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|
President, Chief Executive Officer and Trustee |
|
February 28, 2007 |
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|
David J. Neithercut |
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|
|
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|||||
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|
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|||||
|
/s/ Donna Brandin |
|
|
Executive Vice President and Chief Financial Officer |
|
February 28, 2007 |
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|||
|
Donna Brandin |
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|
|||||
|
|
|
|
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|||||
|
/s/ Ian S. Kaufman |
|
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First Vice President, Controller and Chief Accounting Officer |
|
February 28, 2007 |
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|
Ian S. Kaufman |
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|
|
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|||||
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|
|
|
|
|
|||||
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/s/ John W. Alexander |
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|
Trustee |
|
February 22, 2007 |
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|||
|
John W. Alexander |
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|
|
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|||||
|
|
|
|
|
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|||||
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/s/ Charles L. Atwood |
|
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Trustee |
|
February 19, 2007 |
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|
Charles L. Atwood |
|
|
|
|
|||||
53
SIGNATURES - CONTINUED
|
/s/ Stephen O. Evans |
|
|
Trustee |
|
February 21, 2007 |
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||||||||
|
Stephen O. Evans |
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|
|
|
||||||||||
|
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|
|
|
||||||||||
|
/s/ James D. Harper, Jr. |
|
|
Trustee |
|
February 19, 2007 |
|
||||||||
|
James D. Harper, Jr. |
|
|
|
|
||||||||||
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|
|
|
|
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||||||||||
|
/s/ Boone A. Knox |
|
|
Trustee |
|
February 21, 2007 |
|
||||||||
|
Boone A. Knox |
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|
|
|
||||||||||
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|
|
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||||||||||
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/s/ John E. Neal |
|
|
Trustee |
|
February 20, 2007 |
|
||||||||
|
John E. Neal |
|
|
|
|
||||||||||
|
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|
|
|
|
||||||||||
|
/s/ Desiree G. Rogers |
|
|
Trustee |
|
February 20, 2007 |
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||||||||
|
Desiree G. Rogers |
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|
|
|
||||||||||
|
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|
|
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||||||||||
|
/s/ Sheli Z. Rosenberg |
|
|
Trustee |
|
February 20, 2007 |
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||||||||
|
Sheli Z. Rosenberg |
|
|
|
|
||||||||||
|
|
|
|
|
|
||||||||||
|
/s/ Gerald A. Spector |
|
|
Executive Vice President, Chief Operating Officer and Trustee |
|
February 26, 2007 |
|
||||||||
|
Gerald A. Spector |
|
|
|
|
||||||||||
|
|
|
|
|
|
||||||||||
|
/s/ B. Joseph White |
|
|
Trustee |
|
February 19, 2007 |
|
||||||||
|
B. Joseph White |
|
|
|
|
||||||||||
|
|
|
|
|
|
||||||||||
|
/s/ Samuel Zell |
|
|
Chairman of the Board of Trustees |
|
February 19, 2007 |
|
||||||||
|
Samuel Zell |
|
|
|
|
||||||||||
54
INDEX TO FINANCIAL STATEMENTS AND SCHEDULE
EQUITY RESIDENTIAL
|
|
|
PAGE |
|
|
|
|
|
FINANCIAL STATEMENTS FILED AS PART OF THIS REPORT |
|
|
|
|
|
|
|
|
||
|
|
|
|
|
Report of Independent
Registered Public Accounting Firm on
|
|
|
|
|
|
|
|
Consolidated Balance Sheets as of
|
|
|
|
|
|
|
|
Consolidated Statements of
Operations for
|
|
|
|
|
|
|
|
Consolidated Statements of
Cash Flows for
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
||
|
|
|
|
|
SCHEDULE FILED AS PART OF THIS REPORT |
|
|
|
|
|
|
|
|
All other schedules have been omitted because they are inapplicable, not required or the information is included elsewhere in the consolidated financial statements or notes thereto.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Trustees and Shareholders
Equity Residential
We have audited the accompanying consolidated balance sheets of Equity Residential (the “Company”) as of December 31, 2006 and 2005 and the related consolidated statements of operations, changes in shareholders’ equity and cash flows for each of the three years in the period ended December 31, 2006. Our audits also included the financial statement schedule listed in the accompanying index to the financial statements and schedule. These financial statements and schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Equity Residential at December 31, 2006 and 2005, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2006, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the effectiveness of Equity Residential’s internal control over financial reporting as of December 31, 2006, based on the criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 21, 2007 expressed an unqualified opinion thereon.
|
|
/s/ ERNST & YOUNG LLP |
|
|
|
ERNST & YOUNG LLP |
|
Chicago, Illinois
February 21, 2007
F-2
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM ON
INTERNAL CONTROL OVER FINANCIAL REPORTING
To the Board of Trustees and Shareholders
Equity Residential
We have audited management’s assessment, included in the accompanying Management’s Report on Internal Control over Financial Reporting at Item 9A, that Equity Residential (the “Company”) maintained effective internal control over financial reporting as of December 31, 2006, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the “COSO Criteria”). The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting. Our responsibility is to express an opinion on management’s assessment and an opinion on the effectiveness of the Company’s internal control over financial reporting based on our audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, evaluating management’s assessment, testing and evaluating the design and operating effectiveness of internal control, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
In our opinion, management’s assessment that Equity Residential maintained effective internal control over financial reporting as of December 31, 2006, is fairly stated, in all material respects, based on the COSO Criteria. Also, in our opinion, Equity Residential maintained, in all material respects, effective internal control over financial reporting as of December 31, 2006, based on the COSO Criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Equity Residential as of December 31, 2006 and 2005 and the related consolidated statements of operations, changes in shareholders’ equity and cash flows for each of the three years in the period ended December 31, 2006 and our report dated February 21, 2007, expressed an unqualified opinion thereon.
|
|
/s/ Ernst & Young LLP |
|
|
|
Ernst & Young LLP |
|
Chicago, Illinois
February 21, 2007
F-3
EQUITY RESIDENTIAL
(Amounts in thousands except for share amounts)
|
|
|
December 31,
|
|
December 31,
|
|
||
|
ASSETS |
|
|
|
|
|
||
|
Investment in real estate |
|
|
|
|
|
||
|
Land |
|
$ |
3,217,672 |
|
$ |
2,848,601 |
|
|
Depreciable property |
|
13,376,359 |
|
13,336,636 |
|
||
|
Projects under development |
|
386,917 |
|
240,980 |
|
||
|
Land held for development |
|
254,227 |
|
164,153 |
|
||
|
Investment in real estate |
|
17,235,175 |
|
16,590,370 |
|
||
|
Accumulated depreciation |
|
(3,022,480 |
) |
(2,888,140 |
) |
||
|
Investment in real estate, net |
|
14,212,695 |
|
13,702,230 |
|
||
|
|
|
|
|
|
|
||
|
Cash and cash equivalents |
|
260,277 |
|
88,828 |
|
||
|
Investments in unconsolidated entities |
|
4,448 |
|
6,838 |
|
||
|
Rents receivable |
|
390 |
|
789 |
|
||
|
Deposits – restricted |
|
391,825 |
|
77,093 |
|
||
|
Escrow deposits – mortgage |
|
25,528 |
|
35,225 |
|
||
|
Deferred financing costs, net |
|
43,384 |
|
40,636 |
|
||
|
Goodwill, net |
|
— |
|
30,000 |
|
||
|
Other assets |
|
123,672 |
|
127,112 |
|
||
|
Total assets |
|
$ |
15,062,219 |
|
$ |
14,108,751 |
|
|
|
|
|
|
|
|
||
|
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
|
|
||
|
Liabilities: |
|
|
|
|
|
||
|
Mortgage notes payable |
|
$ |
3,178,223 |
|
$ |
3,379,289 |
|
|
Notes, net |
|
4,419,433 |
|
3,442,784 |
|
||
|
Lines of credit |
|
460,000 |
|
769,000 |
|
||
|
Accounts payable and accrued expenses |
|
100,605 |
|
115,543 |
|
||
|
Accrued interest payable |
|
91,172 |
|
78,441 |
|
||
|
Rents received in advance and other liabilities |
|
307,651 |
|
305,536 |
|
||
|
Security deposits |
|
58,072 |
|
54,823 |
|
||
|
Distributions payable |
|
151,382 |
|
145,812 |
|
||
|
Total liabilities |
|
8,766,538 |
|
8,291,228 |
|
||
|
|
|
|
|
|
|
||
|
Commitments and contingencies |
|
|
|
|
|
||
|
Minority Interests: |
|
|
|
|
|
||
|
Operating Partnership |
|
372,961 |
|
345,034 |
|
||
|
Preference Interests and Units |
|
11,684 |
|
60,184 |
|
||
|
Partially Owned Properties |
|
26,814 |
|
16,965 |
|
||
|
Total Minority Interests |
|
411,459 |
|
422,183 |
|
||
|
|
|
|
|
|
|
||
|
Shareholders’ equity: |
|
|
|
|
|
||
|
Preferred Shares of beneficial interest, $0.01 par value; 100,000,000 shares authorized; 2,762,950 shares issued and outstanding as of December 31, 2006 and 3,323,830 shares issued and outstanding as of December 31, 2005 |
|
386,574 |
|
504,096 |
|
||
|
Common Shares of beneficial interest, $0.01 par value; 1,000,000,000 shares authorized; 293,551,633 shares issued and outstanding as of December 31, 2006 and 289,536,344 shares issued and outstanding as of December 31, 2005 |
|
2,936 |
|
2,895 |
|
||
|
Paid in capital |
|
5,349,194 |
|
5,253,188 |
|
||
|
Retained earnings (deficit) |
|
159,528 |
|
(350,367 |
) |
||
|
Accumulated other comprehensive loss |
|
(14,010 |
) |
(14,472 |
) |
||
|
Total shareholders’ equity |
|
5,884,222 |
|
5,395,340 |
|
||
|
Total liabilities and shareholders’ equity |
|
$ |
15,062,219 |
|
$ |
14,108,751 |
|
See accompanying notes
F-4
EQUITY RESIDENTIAL
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands except per share data)
|
|
|
Year Ended December 31, |
|
|||||||
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
REVENUES |
|
|
|
|
|
|
|
|||
|
Rental income |
|
$ |
1,981,335 |
|
$ |
1,672,418 |
|
$ |
1,483,184 |
|
|
Fee and asset management |
|
9,101 |
|
10,240 |
|
10,743 |
|
|||
|
Total revenues |
|
1,990,436 |
|
1,682,658 |
|
1,493,927 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
EXPENSES |
|
|
|
|
|
|
|
|||
|
Property and maintenance |
|
527,154 |
|
451,245 |
|
392,295 |
|
|||
|
Real estate taxes and insurance |
|
199,582 |
|
191,679 |
|
175,605 |
|
|||
|
Property management |
|
96,417 |
|
87,103 |
|
76,898 |
|
|||
|
Fee and asset management |
|
8,934 |
|
8,555 |
|
7,572 |
|
|||
|
Depreciation |
|
562,739 |
|
439,594 |
|
380,673 |
|
|||
|
General and administrative |
|
48,465 |
|
70,405 |
|
47,128 |
|
|||
|
Impairment |
|
34,002 |
|
613 |
|
1,538 |
|
|||
|
Total expenses |
|
1,477,293 |
|
1,249,194 |
|
1,081,709 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Operating income |
|
513,143 |
|
433,464 |
|
412,218 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Interest and other income |
|
31,131 |
|
68,399 |
|
8,765 |
|
|||
|
Interest: |
|
|
|
|
|
|
|
|||
|
Expense incurred, net |
|
(427,952 |
) |
(362,347 |
) |
(307,697 |
) |
|||
|
Amortization of deferred financing costs |
|
(8,302 |
) |
(6,503 |
) |
(5,814 |
) |
|||
|
|
|
|
|
|
|
|
|
|||
|
Income before allocation to Minority Interests, (loss) income from investments in unconsolidated entities, net gain on sales of unconsolidated entities and land parcels and discontinued operations |
|
108,020 |
|
133,013 |
|
107,472 |
|
|||
|
Allocation to Minority Interests: |
|
|
|
|
|
|
|
|||
|
Operating Partnership, net |
|
(4,201 |
) |
(6,796 |
) |
(2,624 |
) |
|||
|
Preference Interests and Units |
|
(2,002 |
) |
(7,606 |
) |
(19,490 |
) |
|||
|
Partially Owned Properties |
|
(3,132 |
) |
801 |
|
1,787 |
|
|||
|
Premium on redemption of Preference Interests |
|
(684 |
) |
(4,134 |
) |
(1,117 |
) |
|||
|
(Loss) income from investments in unconsolidated entities |
|
(631 |
) |
470 |
|
(7,325 |
) |
|||
|
Net gain on sales of unconsolidated entities |
|
370 |
|
1,330 |
|
4,593 |
|
|||
|
Net gain on sales of land parcels |
|
2,792 |
|
30,245 |
|
5,482 |
|
|||
|
Income from continuing operations, net of minority interests |
|
100,532 |
|
147,323 |
|
88,778 |
|
|||
|
Discontinued operations, net of minority interests |
|
972,312 |
|
714,470 |
|
383,551 |
|
|||
|
Net income |
|
1,072,844 |
|
861,793 |
|
472,329 |
|
|||
|
Preferred distributions |
|
(37,113 |
) |
(49,642 |
) |
(53,746 |
) |
|||
|
Premium on redemption of Preferred Shares |
|
(3,965 |
) |
(4,359 |
) |
— |
|
|||
|
Net income available to Common Shares |
|
$ |
1,031,766 |
|
$ |
807,792 |
|
$ |
418,583 |
|
|
|
|
|
|
|
|
|
|
|||
|
Earnings per share - basic: |
|
|
|
|
|
|
|
|||
|
Income from continuing operations available to Common Shares |
|
$ |
0.21 |
|
$ |
0.33 |
|
$ |
0.13 |
|
|
Net income available to Common Shares |
|
$ |
3.56 |
|
$ |
2.83 |
|
$ |
1.50 |
|
|
Weighted average Common Shares outstanding |
|
290,019 |
|
285,760 |
|
279,744 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Earnings per share - diluted: |
|
|
|
|
|
|
|
|||
|
Income from continuing operations available to Common Shares |
|
$ |
0.20 |
|
$ |
0.32 |
|
$ |
0.12 |
|
|
Net income available to Common Shares |
|
$ |
3.50 |
|
$ |
2.79 |
|
$ |
1.48 |
|
|
Weighted average Common Shares outstanding |
|
315,579 |
|
310,785 |
|
303,871 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Distributions declared per Common Share outstanding |
|
$ |
1.79 |
|
$ |
1.74 |
|
$ |
1.73 |
|
See accompanying notes
F-5
EQUITY RESIDENTIAL
CONSOLIDATED STATEMENTS OF OPERATIONS (Continued)
(Amounts in thousands except per share data)
|
|
|
Year Ended December 31, |
|
|||||||
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Comprehensive income: |
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Net income |
|
$ |
1,072,844 |
|
$ |
861,793 |
|
$ |
472,329 |
|
|
Other comprehensive income (loss) – derivative and other instruments: |
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Unrealized holding (losses) gains arising during the year |
|
(1,785 |
) |
4,357 |
|
(3,707 |
) |
|||
|
Equity in unrealized holding gains arising during the year – unconsolidated entities |
|
— |
|
— |
|
3,667 |
|
|||
|
Losses reclassified into earnings from other comprehensive income |
|
2,247 |
|
2,541 |
|
2,071 |
|
|||
|
Comprehensive income |
|
$ |
1,073,306 |
|
$ |
868,691 |
|
$ |
474,360 |
|
See accompanying notes
F-6
EQUITY RESIDENTIAL
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
|
|
|
Year Ended December 31, |
|
|||||||
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
|
|
|||
|
Net income |
|
$ |
1,072,844 |
|
$ |
861,793 |
|
$ |
472,329 |
|
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
|
|
|||
|
Allocation to Minority Interests: |
|
|
|
|
|
|
|
|||
|
Operating Partnership |
|
72,574 |
|
58,514 |
|
31,228 |
|
|||
|
Preference Interests and Units |
|
2,002 |
|
7,606 |
|
19,490 |
|
|||
|
Partially Owned Properties |
|
3,132 |
|
(801 |
) |
(1,787 |
) |
|||
|
Premium on redemption of Preference Interests |
|
684 |
|
4,134 |
|
1,117 |
|
|||
|
Depreciation |
|
592,637 |
|
528,958 |
|
496,583 |
|
|||
|
Amortization of deferred financing costs |
|
9,134 |
|
7,166 |
|
7,276 |
|
|||
|
Amortization of discounts and premiums on debt |
|
(6,506 |
) |
(3,502 |
) |
(784 |
) |
|||
|
Amortization of deferred settlements on derivative instruments |
|
841 |
|
1,160 |
|
1,001 |
|
|||
|
Impairment |
|
34,353 |
|
613 |
|
1,538 |
|
|||
|
(Income) from technology investments |
|
(4,021 |
) |
(57,054 |
) |
— |
|
|||
|
Loss (income) from investments in unconsolidated entities |
|
631 |
|
(470 |
) |
7,325 |
|
|||
|
Distributions from unconsolidated entities – return on capital |
|
171 |
|
— |
|
— |
|
|||
|
Net (gain) on sales of unconsolidated entities |
|
(370 |
) |
(1,330 |
) |
(4,593 |
) |
|||
|
Net (gain) on sales of land parcels |
|
(2,792 |
) |
(30,245 |
) |
(5,482 |
) |
|||
|
Net (gain) on sales of discontinued operations |
|
(1,016,443 |
) |
(697,655 |
) |
(318,443 |
) |
|||
|
Loss on debt extinguishments |
|
12,171 |
|
10,977 |
|
113 |
|
|||
|
Unrealized loss on derivative instruments |
|
7 |
|
10 |
|
249 |
|
|||
|
Compensation paid with Company Common Shares |
|
22,080 |
|
35,905 |
|
16,826 |
|
|||
|
Other operating activities, net |
|
555 |
|
(279 |
) |
(1,432 |
) |
|||
|
|
|
|
|
|
|
|
|
|||
|
Changes in assets and liabilities: |
|
|
|
|
|
|
|
|||
|
Decrease (increase) in rents receivable |
|
406 |
|
918 |
|
(628 |
) |
|||
|
Decrease (increase) in deposits – restricted |
|
2,225 |
|
5,829 |
|
(6,037 |
) |
|||
|
Decrease (increase) in other assets |
|
569 |
|
(21,553 |
) |
(20,633 |
) |
|||
|
(Decrease) in accounts payable and accrued expenses |
|
(10,797 |
) |
(10,400 |
) |
(8,214 |
) |
|||
|
Increase in accrued interest payable |
|
17,192 |
|
8,171 |
|
9,176 |
|
|||
|
(Decrease) increase in rents received in advance and other liabilities |
|
(50,727 |
) |
(15,203 |
) |
8,032 |
|
|||
|
Increase in security deposits |
|
2,914 |
|
5,269 |
|
2,811 |
|
|||
|
Net cash provided by operating activities |
|
755,466 |
|
698,531 |
|
707,061 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
|
|||
|
Investment in real estate – acquisitions |
|
(1,718,105 |
) |
(2,229,881 |
) |
(820,029 |
) |
|||
|
Investment in real estate – development/other |
|
(291,338 |
) |
(164,202 |
) |
(107,251 |
) |
|||
|
Improvements to real estate |
|
(255,180 |
) |
(232,500 |
) |
(212,171 |
) |
|||
|
Additions to non-real estate property |
|
(10,652 |
) |
(17,610 |
) |
(6,552 |
) |
|||
|
Interest capitalized for real estate under development |
|
(20,734 |
) |
(13,701 |
) |
(11,687 |
) |
|||
|
Interest capitalized for unconsolidated entities under development |
|
— |
|
— |
|
(2,282 |
) |
|||
|
Proceeds from disposition of real estate, net |
|
2,318,247 |
|
1,978,087 |
|
937,690 |
|
|||
|
Proceeds from disposition of unconsolidated entities |
|
373 |
|
3,533 |
|
7,940 |
|
|||
|
Proceeds from technology investments |
|
4,021 |
|
82,054 |
|
— |
|
|||
|
Investments in unconsolidated entities |
|
(1,072 |
) |
(1,480 |
) |
(406,524 |
) |
|||
|
Distributions from unconsolidated entities – return of capital |
|
92 |
|
3,194 |
|
26,553 |
|
|||
|
(Increase) decrease in deposits on real estate acquisitions, net |
|
(296,589 |
) |
(706 |
) |
58,715 |
|
|||
|
Decrease in mortgage deposits |
|
10,098 |
|
683 |
|
9,144 |
|
|||
See accompanying notes
F-7
EQUITY RESIDENTIAL
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
(Amounts in thousands)
|
|
|
Year Ended December 31, |
|
|||||||
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
CASH FLOWS FROM INVESTING ACTIVITIES (continued): |
|
|
|
|
|
|
|
|||
|
Consolidation of previously Unconsolidated Properties: |
|
|
|
|
|
|
|
|||
|
Via acquisition (net of cash acquired) |
|
$ |
— |
|
$ |
(62 |
) |
$ |
(49,183 |
) |
|
Via EITF 04-5/FIN 46 (cash consolidated) |
|
1,436 |
|
— |
|
3,628 |
|
|||
|
Acquisition of Minority Interests – Partially Owned Properties |
|
(71 |
) |
(1,989 |
) |
(72 |
) |
|||
|
Other investing activities, net |
|
2 |
|
2,379 |
|
16,802 |
|
|||
|
Net cash (used for) investing activities |
|
(259,472 |
) |
(592,201 |
) |
(555,279 |
) |
|||
|
|
|
|
|
|
|
|
|
|||
|
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|||
|
Loan and bond acquisition costs |
|
(11,662 |
) |
(12,816 |
) |
(9,696 |
) |
|||
|
Mortgage notes payable: |
|
|
|
|
|
|
|
|||
|
Proceeds |
|
267,045 |
|
280,125 |
|
467,541 |
|
|||
|
Restricted cash |
|
(20,193 |
) |
— |
|
— |
|
|||
|
Lump sum payoffs |
|
(466,035 |
) |
(442,786 |
) |
(469,333 |
) |
|||
|
Scheduled principal repayments |
|
(26,967 |
) |
(27,607 |
) |
(25,607 |
) |
|||
|
Prepayment premiums/fees |
|
(12,171 |
) |
(10,977 |
) |
(450 |
) |
|||
|
Notes, net: |
|
|
|
|
|
|
|
|||
|
Proceeds |
|
1,039,927 |
|
499,435 |
|
898,014 |
|
|||
|
Lump sum payoffs |
|
(60,000 |
) |
(190,000 |
) |
(531,390 |
) |
|||
|
Scheduled principal repayments |
|
(4,286 |
) |
(4,286 |
) |
(4,286 |
) |
|||
|
Lines of credit: |
|
|
|
|
|
|
|
|||
|
Proceeds |
|
6,417,500 |
|
6,291,300 |
|
1,742,000 |
|
|||
|
Repayments |
|
(6,726,500 |
) |
(5,672,300 |
) |
(1,602,000 |
) |
|||
|
Proceeds from (payments on) settlement of derivative instruments |
|
10,722 |
|
(7,823 |
) |
(7,346 |
) |
|||
|
Proceeds from sale of Common Shares |
|
7,972 |
|
8,285 |
|
6,853 |
|
|||
|
Proceeds from exercise of options |
|
69,726 |
|
54,858 |
|
79,043 |
|
|||
|
Common Shares repurchased and retired |
|
(83,230 |
) |
— |
|
— |
|
|||
|
Redemption of Preferred Shares |
|
(115,000 |
) |
(125,000 |
) |
— |
|
|||
|
Redemption of Preference Interests |
|
(25,500 |
) |
(146,000 |
) |
(40,000 |
) |
|||
|
Premium on redemption of Preferred Shares |
|
(27 |
) |
(43 |
) |
— |
|
|||
|
Premium on redemption of Preference Interests |
|
(10 |
) |
(322 |
) |
— |
|
|||
|
Payment of offering costs |
|
(125 |
) |
(26 |
) |
(24 |
) |
|||
|
Contributions – Minority Interests – Partially Owned Properties |
|
9,582 |
|
7,439 |
|
100 |
|
|||
|
Distributions: |
|
|
|
|
|
|
|
|||
|
Common Shares |
|
(514,055 |
) |
(496,004 |
) |
(484,540 |
) |
|||
|
Preferred Shares |
|
(39,344 |
) |
(51,092 |
) |
(54,350 |
) |
|||
|
Preference Interests and Units |
|
(2,054 |
) |
(7,778 |
) |
(19,612 |
) |
|||
|
Minority Interests – Operating Partnership |
|
(36,202 |
) |
(35,833 |
) |
(36,446 |
) |
|||
|
Minority Interests – Partially Owned Properties |
|
(3,658 |
) |
(11,756 |
) |
(26,327 |
) |
|||
|
Net cash (used for) financing activities |
|
(324,545 |
) |
(101,007 |
) |
(117,856 |
) |
|||
|
Net increase in cash and cash equivalents Nts |
|
171,449 |
|
5,323 |
|
33,926 |
|
|||
|
Cash and cash equivalents, beginning of year |
|
88,828 |
|
83,505 |
|
49,579 |
|
|||
|
Cash and cash equivalents, end of year |
|
$ |
260,277 |
|
$ |
88,828 |
|
$ |
83,505 |
|
See accompanying notes
F-8
EQUITY RESIDENTIAL
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
(Amounts in thousands)
|
|
|
Year Ended December 31, |
|
|||||||
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
SUPPLEMENTAL INFORMATION: |
|
|
|
|
|
|
|
|||
|
Cash paid during the year for interest |
|
$ |
465,388 |
|
$ |
397,886 |
|
$ |
348,574 |
|
|
|
|
|
|
|
|
|
|
|||
|
Cash paid during the year for income, franchise and excise taxes |
|
$ |
11,750 |
|
$ |
11,605 |
|
$ |
2,991 |
|
|
|
|
|
|
|
|
|
|
|||
|
Real estate acquisitions/dispositions/other: |
|
|
|
|
|
|
|
|||
|
Mortgage loans assumed |
|
$ |
126,988 |
|
$ |
443,478 |
|
$ |
95,901 |
|
|
Valuation of OP Units issued |
|
$ |
49,591 |
|
$ |
33,662 |
|
$ |
9,087 |
|
|
Mortgage loans (assumed) by purchaser |
|
$ |
(117,949 |
) |
$ |
(35,031 |
) |
$ |
(29,470 |
) |
|
|
|
|
|
|
|
|
|
|||
|
Consolidation of previously Unconsolidated Properties – Via acquisition: |
|
|
|
|
|
|
|
|||
|
Investment in real estate |
|
$ |
— |
|
$ |
(5,608 |
) |
$ |
(960,331 |
) |
|
Mortgage loans assumed |
|
$ |
— |
|
$ |
2,839 |
|
$ |
274,818 |
|
|
Minority Interests – Partially Owned Properties |
|
$ |
— |
|
$ |
59 |
|
$ |
445 |
|
|
Investments in unconsolidated entities |
|
$ |
— |
|
$ |
1,176 |
|
$ |
608,681 |
|
|
Net other liabilities recorded |
|
$ |
— |
|
$ |
1,472 |
|
$ |
27,204 |
|
|
|
|
|
|
|
|
|
|
|||
|
Consolidation
of previously Unconsolidated Properties –
|
|
|
|
|
|
|
|
|||
|
Investment in real estate, net |
|
$ |
(24,637 |
) |
$ |
— |
|
$ |
(548,342 |
) |
|
Mortgage loans consolidated |
|
$ |
22,545 |
|
$ |
— |
|
$ |
294,722 |
|
|
Minority Interests – Partially Owned Properties |
|
$ |
— |
|
$ |
— |
|
$ |
3,074 |
|
|
Investments in unconsolidated entities |
|
$ |
2,602 |
|
$ |
— |
|
$ |
234,984 |
|
|
Net other liabilities recorded |
|
$ |
926 |
|
$ |
— |
|
$ |
19,190 |
|
|
|
|
|
|
|
|
|
|
|||
|
Refinancing of mortgage notes payable into notes, net |
|
$ |
— |
|
$ |
— |
|
$ |
130,000 |
|
See accompanying notes
F-9
EQUITY RESIDENTIAL
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(Amounts in thousands)
|
|
|
Year Ended December 31, |
|
|||||||
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
PREFERRED SHARES |
|
|
|
|
|
|
|
|||
|
Balance, beginning of year |
|
$ |
504,096 |
|
$ |
636,216 |
|
$ |
670,913 |
|
|
Redemption of 9 1/8% Series B Cumulative Redeemable |
|
— |
|
(125,000 |
) |
— |
|
|||
|
Redemption of 9 1/8% Series C Cumulative Redeemable |
|
(115,000 |
) |
— |
|
— |
|
|||
|
Conversion of 7.00% Series E Cumulative Convertible |
|
(2,357 |
) |
(7,065 |
) |
(34,519 |
) |
|||
|
Conversion of 7.00% Series H Cumulative Convertible |
|
(165 |
) |
(55 |
) |
(178 |
) |
|||
|
Balance, end of year |
|
$ |
386,574 |
|
$ |
504,096 |
|
$ |
636,216 |
|
|
|
|
|
|
|
|
|
|
|||
|
COMMON SHARES, $0.01 PAR VALUE |
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Balance, beginning of year |
|
$ |
2,895 |
|
$ |
2,851 |
|
$ |
2,776 |
|
|
Conversion of Preferred Shares into Common Shares |
|
1 |
|
3 |
|
16 |
|
|||
|
Conversion of Preference Interests into Common Shares |
|
7 |
|
— |
|
— |
|
|||
|
Conversion of OP Units into Common Shares |
|
17 |
|
11 |
|
17 |
|
|||
|
Exercise of share options |
|
27 |
|
22 |
|
34 |
|
|||
|
Employee Share Purchase Plan (ESPP) |
|
2 |
|
3 |
|
3 |
|
|||
|
Share-based employee compensation expense: |
|
|
|
|
|
|
|
|||
|
Restricted/performance shares |
|
6 |
|
5 |
|
5 |
|
|||
|
Common Shares repurchased and retired |
|
(19 |
) |
— |
|
— |
|
|||
|
Balance, end of year |
|
$ |
2,936 |
|
$ |
2,895 |
|
$ |
2,851 |
|
|
|
|
|
|
|
|
|
|
|||
|
PAID IN CAPITAL |
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Balance, beginning of year |
|
$ |
5,253,188 |
|
$ |
5,112,311 |
|
$ |
4,956,712 |
|
|
Common Share Issuance: |
|
|
|
|
|
|
|
|||
|
Conversion of Preferred Shares into Common Shares |
|
2,521 |
|
7,117 |
|
34,681 |
|
|||
|
Conversion of Preference Interests into Common Shares |
|
22,993 |
|
— |
|
— |
|
|||
|
Conversion of OP Units into Common Shares |
|
27,865 |
|
24,185 |
|
36,903 |
|
|||
|
Exercise of share options |
|
69,699 |
|
54,836 |
|
79,009 |
|
|||
|
Employee Share Purchase Plan (ESPP) |
|
7,970 |
|
8,282 |
|
6,850 |
|
|||
|
Share-based employee compensation expense: |
|
|
|
|
|
|
|
|||
|
Performance shares |
|
1,795 |
|
7,697 |
|
224 |
|
|||
|
Restricted shares |
|
14,938 |
|
20,032 |
|
8,789 |
|
|||
|
Share options |
|
5,198 |
|
6,562 |
|
2,982 |
|
|||
|
ESPP discount |
|
1,578 |
|
1,591 |
|
1,290 |
|
|||
|
Common Shares repurchased and retired |
|
(83,211 |
) |
— |
|
|
|
|||
|
Offering costs |
|
(125 |
) |
(26 |
) |
(24 |
) |
|||
|
Premium on redemption of Preferred Shares – original issuance costs |
|
3,938 |
|
4,316 |
|
— |
|
|||
|
Premium on redemption of Preference Interests – original issuance costs |
|
674 |
|
3,812 |
|
1,117 |
|
|||
|
Supplemental Executive Retirement Plan (SERP) |
|
(9,947 |
) |
(4,177 |
) |
(8,705 |
) |
|||
|
Adjustment for Minority Interests ownership in Operating Partnership |
|
30,120 |
|
6,650 |
|
(7,517 |
) |
|||
|
Balance, end of year |
|
$ |
5,349,194 |
|
$ |
5,253,188 |
|
$ |
5,112,311 |
|
See accompanying notes
F-10
EQUITY RESIDENTIAL
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Continued)
(Amounts in thousands)
|
|
|
Year Ended December 31, |
|
|||||||
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
DEFERRED COMPENSATION |
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Balance, beginning of year |
|
$ |
— |
|
$ |
(18 |
) |
$ |
(3,554 |
) |
|
Amortization to compensation expense: |
|
|
|
|
|
|
|
|||
|
Performance shares |
|
— |
|
— |
|
88 |
|
|||
|
Restricted shares |
|
— |
|
18 |
|
3,448 |
|
|||
|
Balance, end of year |
|
$ |
— |
|
$ |
— |
|
$ |
(18 |
) |
|
|
|
|
|
|
|
|
|
|||
|
RETAINED EARNINGS (DEFICIT) |
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Balance, beginning of year |
|
$ |
(350,367 |
) |
$ |
(657,462 |
) |
$ |
(588,005 |
) |
|
Net income |
|
1,072,844 |
|
861,793 |
|
472,329 |
|
|||
|
Common Share distributions |
|
(521,871 |
) |
(500,697 |
) |
(488,040 |
) |
|||
|
Preferred Share distributions |
|
(37,113 |
) |
(49,642 |
) |
(53,746 |
) |
|||
|
Premium on redemption of Preferred Shares – cash charge |
|
(27 |
) |
(43 |
) |
— |
|
|||
|
Premium on redemption of Preferred Shares – original issuance costs |
|
(3,938 |
) |
(4,316 |
) |
— |
|
|||
|
Balance, end of year |
|
$ |
159,528 |
|
$ |
(350,367 |
) |
$ |
(657,462 |
) |
|
|
|
|
|
|
|
|
|
|||
|
ACCUMULATED OTHER COMPREHENSIVE LOSS |
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Balance, beginning of year |
|
$ |
(14,472 |
) |
$ |
(21,370 |
) |
$ |
(23,401 |
) |
|
Accumulated other comprehensive income (loss) – derivative and other instruments: |
|
|
|
|
|
|
|
|||
|
Unrealized holding (losses) gains arising during the year |
|
(1,785 |
) |
4,357 |
|
(3,707 |
) |
|||
|
Equity in unrealized holding gains arising during the year – unconsolidated entities |
|
— |
|
— |
|
3,667 |
|
|||
|
Losses reclassified into earnings from other comprehensive income |
|
2,247 |
|
2,541 |
|
2,071 |
|
|||
|
Balance, end of year |
|
$ |
(14,010 |
) |
$ |
(14,472 |
) |
$ |
(21,370 |
) |
F-11
EQUITY RESIDENTIAL
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Business
Equity Residential (“EQR”), a Maryland real estate investment trust (“REIT”) formed in March 1993, is an S&P 500 company focused on the acquisition, development and management of high quality apartment properties in top United States growth markets. EQR has elected to be taxed as a REIT.
EQR is the general partner of, and as of December 31, 2006 owned an approximate 93.6% ownership interest in, ERP Operating Limited Partnership, an Illinois limited partnership (the “Operating Partnership”). The Company is structured as an umbrella partnership REIT (“UPREIT”), under which all property ownership and business operations are conducted through the Operating Partnership and its subsidiaries. References to the “Company” include EQR, the Operating Partnership and those entities owned or controlled by the Operating Partnership and/or EQR.
As of December 31, 2006, the Company, directly or indirectly through investments in title holding entities, owned all or a portion of 617 properties in 25 states and the District of Columbia consisting of 165,716 units. The ownership breakdown includes (table does not include various uncompleted development properties):
|
|
|
Properties |
|
Units |
|
|
Wholly Owned Properties |
|
546 |
|
146,442 |
|
|
Partially Owned Properties: |
|
|
|
|
|
|
Consolidated |
|
25 |
|
4,873 |
|
|
Unconsolidated |
|
45 |
|
10,846 |
|
|
Military Housing (Fee Managed) |
|
1 |
|
3,555 |
|
|
|
|
617 |
|
165,716 |
|
The “Wholly Owned Properties” are accounted for under the consolidation method of accounting. The Company beneficially owns 100% fee simple title to 545 of the 546 Wholly Owned Properties. The Company owns the building and improvements and leases the land underlying the improvements under a long-term ground lease that expires in 2026 for one property. This one property is consolidated and reflected as a real estate asset while the ground lease is accounted for as an operating lease in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 13, Accounting for Leases .
The “Partially Owned Properties - Consolidated” are controlled by the Company but have partners with minority interests and are accounted for under the consolidation method of accounting. The “Partially Owned Properties - Unconsolidated” are partially owned but not controlled by the Company and consist of investments in partnership interests and/or subordinated mortgages that are accounted for under the equity method of accounting. The “Military Housing (Fee Managed)” property consists of an investment in a limited liability company that, as a result of the terms of the operating agreement, is accounted for as a management contract right with all fees recognized as fee and asset management revenue.
2. Summary of Significant Accounting Policies
Basis of Presentation
Due to the Company’s ability as general partner to control either through ownership or by contract the Operating Partnership and its subsidiaries, other than entities that own controlling interests in the
F-12
Partially Owned Properties - Unconsolidated and certain other entities in which the Company has investments, the Operating Partnership and each such subsidiary has been consolidated with the Company for financial reporting purposes. Effective March 31, 2004, the consolidated financial statements also include all variable interest entities for which the Company is the primary beneficiary.
The Company’s mergers and acquisitions were accounted for as purchases in accordance with either Accounting Principles Board (“APB”) Opinion No. 16, Business Combinations , or SFAS No. 141, Business Combinations . SFAS No. 141 requires all business combinations initiated after June 30, 2001 be accounted for under the purchase method of accounting. The fair value of the consideration given by the Company in the mergers were used as the valuation basis for each of the combinations. The accompanying consolidated statements of operations and cash flows include the results of the properties purchased through the mergers and through acquisitions from their respective closing dates.
Real Estate Assets and Depreciation of Investment in Real Estate
The Company allocates the purchase price of properties to net tangible and identified intangible assets acquired based on their fair values in accordance with the provisions of SFAS No. 141. In making estimates of fair values for purposes of allocating purchase price, the Company utilizes a number of sources, including independent appraisals that may be obtained in connection with the acquisition or financing of the respective property, our own analysis of recently acquired and existing comparable properties in our portfolio, and other market data. The Company also considers information obtained about each property as a result of its pre-acquisition due diligence, marketing and leasing activities in estimating the fair value of the tangible and intangible assets acquired. The Company allocates the purchase price of acquired real estate to various components as follows:
• Land – Based on actual purchase price if acquired separately or market research/comparables if acquired with an operating property.
• Furniture, Fixtures and Equipment – Ranges between $8,000 and $13,000 per apartment unit acquired as an estimate of the fair value of the appliances & fixtures inside a unit. The per-unit amount applied depends on the type of apartment building acquired. Depreciation is calculated on the straight-line method over an estimated useful life of five years.
• In-Place Leases – The Company considers the value of acquired in-place leases that meet the definition outlined in SFAS No. 141, paragraph 37. The amortization period is the average remaining term of each respective in-place acquired lease.
• Other Intangible Assets – The Company considers whether it has acquired other intangible assets that meet the definition outlined in SFAS No. 141, paragraph 39, including any customer relationship intangibles. The amortization period is the estimated useful life of the acquired intangible asset.
• Building – Based on the fair value determined on an “as-if vacant” basis. Depreciation is calculated on the straight-line method over an estimated useful life of thirty years.
Replacements inside a unit such as appliances and carpeting are depreciated over a five-year estimated useful life. Expenditures for ordinary maintenance and repairs are expensed to operations as incurred and significant renovations and improvements that improve and/or extend the useful life of the asset are capitalized over their estimated useful life, generally five to ten years. Initial direct leasing costs are expensed as incurred as such expense approximates the deferral and amortization of initial direct leasing costs over the lease terms. Property sales or dispositions are recorded when title transfers to unrelated third parties, contingencies have been removed and sufficient cash consideration has been received by the Company. Upon disposition, the related costs and accumulated depreciation are removed from the respective accounts. Any gain or loss on sale is recognized in accordance with accounting principles generally accepted in the United States.
The Company classifies real estate assets as real estate held for disposition when it is certain a property will be disposed of in accordance with SFAS No. 144 (see further discussion below).
F-13
The Company classifies properties under development and/or expansion and properties in the lease up phase (including land) as construction in progress until construction has been completed and all certificates of occupancy permits have been obtained.
Impairment of Long-Lived Assets, Including Goodwill
In June 2001, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 142, Goodwill and Other Intangible Assets . SFAS No. 142 prohibits the amortization of goodwill and requires that goodwill be reviewed for impairment at least annually. In August 2001, the FASB issued SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. SFAS Nos. 142 and 144 were effective for fiscal years beginning after December 15, 2001. The Company adopted these standards effective January 1, 2002. See Notes 13 and 19 for further discussion.
The Company periodically evaluates its long-lived assets, including its investments in real estate and goodwill, for indicators of permanent impairment. The judgments regarding the existence of impairment indicators are based on factors such as operational performance, market conditions, expected holding period of each asset and legal and environmental concerns. Future events could occur which would cause the Company to conclude that impairment indicators exist and an impairment loss is warranted.
For long-lived assets to be held and used, the Company compares the expected future undiscounted cash flows for the long-lived asset against the carrying amount of that asset. If the sum of the estimated undiscounted cash flows is less than the carrying amount of the asset, the Company further analyzes each individual asset for other temporary or permanent indicators of impairment. An impairment loss would be recorded for the difference between the estimated fair value and the carrying amount of the asset if the Company deems this difference to be permanent.
For long-lived assets to be disposed of, an impairment loss is recognized when the estimated fair value of the asset, less the estimated cost to sell, is less than the carrying amount of the asset measured at the time that the Company has determined it will sell the asset. Long-lived assets held for disposition and the related liabilities are separately reported at the lower of their carrying amounts or their estimated fair values, less their costs to sell, and are not depreciated after reclassification to real estate held for disposition.
Cost Capitalization
See the Real Estate Assets and Depreciation of Investment in Real Estate section for discussion of the policy with respect to capitalization vs. expensing of fixed asset/repair and maintenance costs. In addition, the Company capitalizes the payroll and associated costs of employees directly responsible for and who spend all of their time on the supervision of major capital and/or renovation projects. These costs are reflected on the balance sheet as an increase to depreciable property.
The Company follows the guidance in SFAS No. 67, Accounting for Costs and Initial Rental Operations of Real Estate Projects , for all development projects and uses its professional judgment in determining whether such costs meet the criteria for capitalization or must be expensed as incurred. The Company capitalizes interest, real estate taxes and insurance and payroll and associated costs for those individuals directly responsible for and who spend all of their time on development activities, with capitalization ceasing no later than 90 days following issuance of the certificate of occupancy. These costs are reflected on the balance sheet as construction in progress for each specific property. The Company expenses as incurred all payroll costs of on-site employees working directly at our properties, except as noted above on our development properties prior to certificate of occupancy issuance and on specific major renovation at selected properties when additional incremental employees are hired.
F-14
Cash and Cash Equivalents
The Company considers all demand deposits, money market accounts and investments in certificates of deposit and repurchase agreements purchased with a maturity of three months or less, at the date of purchase, to be cash equivalents. The Company maintains its cash and cash equivalents at financial institutions. The combined account balances at one or more institutions typically exceed the Federal Depository Insurance Corporation (“FDIC”) insurance coverage, and, as a result, there is a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. The Company believes that the risk is not significant, as the Company does not anticipate the financial institutions’ non-performance.
Deferred Financing Costs
Deferred financing costs include fees and costs incurred to obtain the Company’s lines of credit and long-term financings. These costs are amortized over the terms of the related debt. Unamortized financing costs are written-off when debt is retired before the maturity date. The accumulated amortization of such deferred financing costs was $24.5 million and $18.3 million at December 31, 2006 and 2005, respectively.
Fair Value of Financial Instruments, Including Derivative Instruments
The valuation of financial instruments under SFAS No. 107, Disclosures about Fair Value of Financial Instruments , and SFAS No. 133 and its amendments (SFAS Nos. 137/138/149), Accounting for Derivative Instruments and Hedging Activities , requires the Company to make estimates and judgments that affect the fair value of the instruments. The Company, where possible, bases the fair values of its financial instruments, including its derivative instruments, on listed market prices and third party quotes. Where these are not available, the Company bases its estimates on current instruments with similar terms and maturities or on other factors relevant to the financial instruments.
In the normal course of business, the Company is exposed to the effect of interest rate changes. The Company limits these risks by following established risk management policies and procedures including the use of derivatives to hedge interest rate risk on debt instruments.
The Company has a policy of only entering into contracts with major financial institutions based upon their credit ratings and other factors. When viewed in conjunction with the underlying and offsetting exposure that the derivatives are designed to hedge, the Company has not sustained a material loss from those instruments nor does it anticipate any material adverse effect on its net income or financial position in the future from the use of derivatives.
On January 1, 2001, the Company adopted SFAS No. 133 and its amendments (SFAS Nos. 137/138/149), which requires an entity to recognize all derivatives as either assets or liabilities in the statement of financial position and to measure those instruments at fair value. Additionally, the fair value adjustments will affect either shareholders’ equity or net income depending on whether the derivative instruments qualify as a hedge for accounting purposes and, if so, the nature of the hedging activity. When the terms of an underlying transaction are modified, or when the underlying transaction is terminated or completed, all changes in the fair value of the instrument are marked-to-market with changes in value included in net income each period until the instrument matures. Any derivative instrument used for risk management that does not meet the hedging criteria of SFAS No. 133 is marked-to-market each period. The Company does not use derivatives for trading or speculative purposes.
The fair value of the Company’s mortgage notes payable and unsecured notes were approximately $3.2 billion and $4.5 billion, respectively, at December 31, 2006. The fair values of the Company’s financial instruments, other than mortgage notes payable, unsecured notes and derivative instruments, including cash and cash equivalents, lines of credit and other financial instruments, approximate their carrying or contract values. See Note 11 for further discussion of derivative instruments.
F-15
Revenue Recognition
Rental income attributable to leases is recorded when due from residents and is recognized monthly as it is earned, which is not materially different than on a straight-line basis. Leases entered into between a resident and a property, for the rental of an apartment unit, are generally year-to-year, renewable upon consent of both parties on an annual or monthly basis. Fee and asset management revenue and interest income are recorded on an accrual basis.
Share-Based Compensation
The Company adopted SFAS No. 123(R), Share-Based Payment, as required effective January 1, 2006. SFAS No. 123(R) requires all companies to expense share-based compensation (such as share options), as well as making other revisions to SFAS No. 123. As the Company began expensing all share-based compensation effective January 1, 2003, the adoption of SFAS No. 123(R) did not have a material effect on its consolidated statements of operations or financial position.
The cost related to share-based employee compensation included in the determination of net income for the years ended December 31, 2006 and 2005 is equal to 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. 123. The cost related to share-based employee compensation included in the determination of net income for the year ended December 31, 2004 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. 123. The following table illustrates the effect on net income and earnings per share if the fair value based method had been applied to all outstanding and unvested awards for the year ended December 31, 2004 (amounts in thousands except per share amounts):
|
|
|
Year Ended
|
|
|
|
Net income available to Common Shares – as reported |
|
$ |
418,583 |
|
|
Add: Share-based employee compensation expense included in reported net income: |
|
|
|
|
|
Performance shares |
|
312 |
|
|
|
Restricted shares |
|
12,242 |
|
|
|
Share options |
|
2,982 |
|
|
|
ESPP discount |
|
1,290 |
|
|
|
Deduct: Share-based employee compensation expense determined under fair value based method for all awards: |
|
|
|
|
|
Performance shares |
|
(312 |
) |
|
|
Restricted shares |
|
(12,242 |
) |
|
|
Share options |
|
(5,385 |
) |
|
|
ESPP discount |
|
(1,290 |
) |
|
|
Net income available to Common Shares – pro forma |
|
$ |
416,180 |
|
|
Earnings per share: |
|
|
|
|
|
Basic – as reported |
|
$ |
1.50 |
|
|
Basic – pro forma |
|
$ |
1.49 |
|
|
|
|
|
|
|
|
Diluted – as reported |
|
$ |
1.48 |
|
|
Diluted – pro forma |
|
$ |
1.47 |
|
The fair value of the option grants as computed under SFAS No. 123 would be recognized over the vesting period of the options. The fair value for the Company’s share options was estimated at the time the share options were granted using the Black-Scholes option pricing model with the following weighted-average assumptions:
F-16
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
Expected volatility |
|
19.1 |
% |
18.2 |
% |
20.0 |
% |
|||
|
Expected life |
|
6 years |
|
6 years |
|
5 years |
|
|||
|
Expected dividend yield |
|
6.04 |
% |
6.37 |
% |
6.52 |
% |
|||
|
Risk-free interest rate |
|
4.52 |
% |
3.81 |
% |
3.03 |
% |
|||
|
Option valuation per share |
|
$ |
4.22 |
|
$ |
2.64 |
|
$ |
2.26 |
|
The valuation method and assumptions are the same as those the Company used in accounting for option expense in its consolidated financial statements. The Black-Scholes option valuation model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. This model is only one method of valuing options and the Company’s use of this model should not be interpreted as an endorsement of its accuracy. Because the Company’s share options have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management’s opinion, the existing models do not necessarily provide a reliable single measure of the fair value of its share options and the actual value of the options may be significantly different.
Income Taxes
Due to the structure of the Company as a REIT and the nature of the operations of its operating properties, no provision for federal income taxes has been made at the EQR level. Historically, the Company has generally only incurred certain state and local income, excise and franchise taxes. The Company has elected Taxable REIT Subsidiary (“TRS”) status for certain of its corporate subsidiaries, primarily those entities engaged in condominium conversion and sale activities and as a result, these entities incurred federal and state income taxes.
The Company provided for current income, franchise and excise taxes allocated as follows in the consolidated statements of operations for the years ended December 31, 2006, 2005 and 2004 (amounts in thousands):
|
|
|
Year Ended December 31, |
|
|||||||
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
General and administrative (1) |
|
$ |
4,263 |
|
$ |
3,949 |
|
$ |
2,432 |
|
|
Discontinued operations, net of minority interests (2) |
|
3,630 |
|
9,604 |
|
917 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Provision for income, franchise and excise taxes |
|
$ |
7,893 |
|
$ |
13,553 |
|
$ |
3,349 |
|
(1) Primarily includes state and local income, excise and franchise taxes. In 2006, also includes $2.9 million of federal income taxes related to a forfeited deposit on a terminated sale transaction and included in income from continuing operations. In 2005, also includes $2.0 million of federal income taxes related to the sale of land parcels owned by a TRS and included in income from continuing operations.
(2) Primarily represents federal income taxes incurred on the gains on sales of condominium units owned by a TRS and included in discontinued operations. Also represents state and local income, excise and franchise taxes on operating properties sold and included in discontinued operations.
The Company utilized approximately $43.9 million of net operating losses (“NOL”) during the year ended December 31, 2005 and had no NOL carryforwards available as of January 1, 2007 or 2006.
During the years ended December 31, 2006, 2005 and 2004, the Company’s tax treatment of dividends and distributions were as follows:
F-17
|
|
|
Year Ended December 31, |
|
|||||||
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
Tax treatment of dividends and distributions: |
|
|
|
|
|
|
|
|||
|
Ordinary dividends |
|
$ |
1.276 |
|
$ |
0.902 |
|
$ |
1.104 |
|
|
Qualified dividends |
|
0.090 |
|
0.070 |
|
0.003 |
|
|||
|
Long-term capital gain |
|
0.330 |
|
0.669 |
|
0.432 |
|
|||
|
Unrecaptured section 1250 gain |
|
0.094 |
|
0.099 |
|
0.151 |
|
|||
|
Nontaxable distributions |
|
— |
|
— |
|
0.040 |
|
|||
|
Dividends and distributions declared per Common Share outstanding |
|
$ |
1.790 |
|
$ |
1.740 |
|
$ |
1.730 |
|
The aggregate cost of land and depreciable property for federal income tax purposes as of December 31, 2006 and 2005 was approximately $10.2 billion and $9.4 billion, respectively.
Minority Interests
Operating Partnership: Net income is allocated to minority interests based on their respective ownership percentage of the Operating Partnership. The ownership percentage is calculated by dividing the number of units of limited partnership interest (“OP Units”) held by the minority interests by the total OP Units held by the minority interests and EQR. Issuance of additional common shares of beneficial interest, $0.01 par value per share (the “Common Shares”), and OP Units changes the ownership interests of both the minority interests and EQR. Such transactions and the related proceeds are treated as capital transactions.
Partially Owned Properties: The Company reflects minority interests in partially owned properties on the balance sheet for the portion of properties consolidated by the Company that are not wholly owned by the Company. The earnings or losses from those properties attributable to the minority interests are reflected as minority interests in partially owned properties in the consolidated statements of operations.
U se of Estimates
In preparation of the Company’s financial statements in conformity with accounting principles generally accepted in the United States, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.
Reclassifications
Certain reclassifications considered necessary for a fair presentation have been made to the prior period financial statements in order to conform to the current year presentation. These reclassifications have not changed the results of operations or shareholders’ equity.
Other
The Company adopted FASB Interpretation (“FIN”) No. 46, Consolidation of Variable Interest Entities, as required, effective March 31, 2004. The adoption required the consolidation of all previously unconsolidated development projects. FIN No. 46 requires the Company to consolidate the assets, liabilities and results of operations of the activities of a variable interest entity, which for the Company includes only its development partnerships, if the Company is entitled to receive a majority of the entity’s residual returns and/or is subject to a majority of the risk of loss from such entity’s activities. Due to the March 31, 2004 effective date, the Company has only consolidated the results of operations beginning April 1, 2004. The adoption of FIN No. 46 did not have any effect on net income as the aggregate results of operations of these development properties were previously included in (loss) income from
F-18
investments in unconsolidated entities.
The Company adopted the disclosure provisions of SFAS No. 150 and FSP No. FAS 150-3, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity, effective December 31, 2003. SFAS No. 150 and FSP No. FAS 150-3 require the Company to make certain disclosures regarding noncontrolling interests that are classified as equity in the financial statements of a subsidiary but would be classified as a liability in the parent’s financial statements under SFAS No. 150 (e.g., minority interests in consolidated limited-life subsidiaries). The Company is presently the controlling partner in various consolidated partnerships consisting of 25 properties and 4,873 units and various uncompleted development properties having a minority interest book value of $26.8 million at December 31, 2006. Some of these partnerships contain provisions that require the partnerships to be liquidated through the sale of its assets upon reaching a date specified in each respective partnership agreement. The Company, as controlling partner, has an obligation to cause the property owning partnerships to distribute proceeds of liquidation to the Minority Interests in these Partially Owned Properties only to the extent that the net proceeds received by the partnerships from the sale of its assets warrant a distribution based on the partnership agreements. As of December 31, 2006, the Company estimates the value of Minority Interest distributions would have been approximately $106.7 million (“Settlement Value”) had the partnerships been liquidated. This Settlement Value is based on estimated third party consideration realized by the partnerships upon disposition of the Partially Owned Properties and is net of all other assets and liabilities, including yield maintenance on the mortgages encumbering the properties, that would have been due on December 31, 2006 had those mortgages been prepaid. Due to, among other things, the inherent uncertainty in the sale of real estate assets, the amount of any potential distribution to the Minority Interests in the Company’s Partially Owned Properties is subject to change. To the extent that the partnerships’ underlying assets are worth less than the underlying liabilities, the Company has no obligation to remit any consideration to the Minority Interests in Partially Owned Properties.
The Company adopted EITF Issue No. 04-5, Determining Whether a General Partner, or the General Partners as a Group, Controls a Limited Partnership or Similar Entity When the Limited Partners Have Certain Rights (Issue “04-5”), effective January 1, 2006. Issue 04-5 provides guidance in determining whether a general partner controls a limited partnership. The Company consolidated its Lexford syndicated portfolio consisting of 20 separate partnerships (10 properties) containing 1,272 units, all of which were sold October 5, 2006. The adoption did not have a material effect on the results of operations or financial position. See Note 4 for further discussion of the adoption of EITF Issue No. 04-5.
In March 2005, the FASB issued FIN No. 47, Accounting for Conditional Asset Retirement Obligations, an interpretation of SFAS No. 143, Asset Retirement Obligations . A conditional asset retirement obligation refers to a legal obligation to retire assets where the timing and/or method of settlement are conditioned on future events. FIN No. 47 requires an entity to recognize a liability for the fair value of a conditional asset retirement obligation when incurred if the liability’s fair value can be reasonably estimated. The Company adopted the provisions of FIN No. 47 for the year ended December 31, 2005. The adoption did not have a material impact on the Company’s consolidated financial position, results of operations or cash flows.
In July 2006, the FASB ratified the consensus in FIN No. 48, Accounting for Uncertainty in Income Taxes . FIN No. 48 creates a single model to address uncertainty in income tax positions and prescribes a minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. It also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition and, clearly scopes income taxes out of SFAS No. 5, Accounting for Contingencies . The Company will adopt FIN No. 48 as required effective January 1, 2007. While still under review, based on analyses completed and knowledge of the Company’s tax positions to date, adoption of FIN No. 48 is not expected to have a material effect on the consolidated results of operations or financial position.
F-19
|
|
|
2006 |
|
2005 |
|
2004 |
|
|
|
|
|
|
|
|
|
|
|
Common Shares outstanding at January 1, |
|
289,536,344 |
|
285,076,915 |
|
277,643,885 |
|
|
|
|
|
|
|
|
|
|
|
Common Shares Issued : |
|
|
|
|
|
|
|
|
Conversion of Series E Preferred Shares |
|
104,904 |
|
314,485 |
|
1,536,501 |
|
|
Conversion of Series H Preferred Shares |
|
9,554 |
|
3,182 |
|
10,268 |
|
|
Conversion of Series H and I Preference Interests |
|
679,686 |
|
— |
|
— |
|
|
Conversion of OP Units |
|
1,653,988 |
|
1,085,446 |
|
1,744,463 |
|
|
Exercise of options |
|
2,647,776 |
|
2,248,744 |
|
3,350,759 |
|
|
Employee Share Purchase Plan |
|
213,427 |
|
286,751 |
|
275,616 |
|
|
Dividend Reinvestment – DRIP Plan |
|
169 |
|
— |
|
— |
|
|
Restricted share grants, net |
|
603,697 |
|
520,821 |
|
515,622 |
|
|
|
|
|
|
|
|
|
|
|
Common Shares Other : |
|
|
|
|
|
|
|
|
Repurchased and retired |
|
(1,897,912 |
) |
— |
|
— |
|
|
Other |
|
— |
|
— |
|
(199 |
) |
|
Common Shares outstanding at December 31, |
|
293,551,633 |
|
289,536,344 |
|
285,076,915 |
|
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
OP Units outstanding at January 1, |
|
20,424,245 |
|
20,552,940 |
|
21,907,732 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
OP Units Issued : |
|
|
|
|
|
|
|
|||
|
Acquisitions/consolidations |
|
1,144,326 |
|
956,751 |
|
306,694 |
|
|||
|
Conversion of Series A Junior Preference Units |
|
— |
|
— |
|
82,977 |
|
|||
|
Conversion of OP Units to Common Shares |
|
(1,653,988 |
) |
(1,085,446 |
) |
(1,744,463 |
) |
|||
|
OP Units Outstanding at December 31, |
|
19,914,583 |
|
20,424,245 |
|
20,552,940 |
|
|||
|
Total Common Shares and OP Units Outstanding at December 31, |
|
313,466,216 |
|
309,960,589 |
|
305,629,855 |
|
|||
|
OP Units Ownership Interest in Operating Partnership |
|
6.4 |
% |
6.6 |
% |
6.7 |
% |
|||
|
|
|
|
|
|
|
|
|
|||
|
OP Units Issued : |
|
|
|
|
|
|
|
|||
|
Acquisitions/consolidations – per unit |
|
$ |
43.34 |
|
$ |
35.18 |
|
$ |
29.63 |
|
|
Acquisitions/consolidations – valuation |
|
$ |
49.6 million |
|
$ |
33.7 million |
|
$ |
9.1 million |
|
|
Conversion of Series A Junior Preference Units – per unit |
|
— |
|
— |
|
$ |
24.50 |
|
||
|
Conversion of Series A Junior Preference Units – valuation |
|
— |
|
— |
|
$ |
2.0 million |
|
||
In February 1998, the Company filed and the SEC declared effective a Form S-3 Registration Statement to register $1.0 billion of equity securities. In addition, the Company carried over $272.4 million related to a prior registration statement. As of February 7, 2007, $956.5 million in equity securities remained available for issuance under this registration statement.
During the year ended December 31, 2006, the Company repurchased 1,897,912 of its Common Shares on the open market at an average price of $43.85 per share. The Company paid approximately $83.2 million for these shares, which were retired subsequent to the repurchase.
The equity positions of various individuals and entities that contributed their properties to the Operating Partnership in exchange for OP Units are collectively referred to as the “Minority Interests – Operating Partnership”. Subject to certain restrictions, the Minority Interests – Operating Partnership may exchange their OP Units for EQR Common Shares on a one-for-one basis.
Net proceeds from the Company’s Common Share and Preferred Share (see definition below) offerings are contributed by the Company to the Operating Partnership. In return for those contributions,
F-20
EQR receives a number of OP Units in the Operating Partnership equal to the number of Common Shares it has issued in the equity offering (or in the case of a preferred equity offering, a number of preference units in the Operating Partnership equal in number and having the same terms as the Preferred Shares issued in the equity offering). As a result, the net offering proceeds from Common Shares and Preferred Shares are allocated between shareholders’ equity and Minority Interests – Operating Partnership to account for the change in their respective percentage ownership of the underlying equity of the Operating Partnership.
The Company’s declaration of trust authorizes the Company to issue up to 100,000,000 preferred shares of beneficial interest, $0.01 par value per share (the “Preferred Shares”), with specific rights, preferences and other attributes as the Board of Trustees may determine, which may include preferences, powers and rights that are senior to the rights of holders of the Company’s Common Shares.
The following table presents the Company’s issued and outstanding Preferred Shares as of December 31, 2006 and 2005:
|
|
|
|
|
|
|
Annual
|
|
Amounts in thousands |
|
|||||
|
|
|
Redemption
|
|
Conversion
|
|
per Share
|
|
December
|
|
December
|
|
|||
|
Preferred Shares of beneficial interest, $0.01 par value; 100,000,000 shares authorized: |
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
9 1/8% Series C Cumulative Redeemable Preferred; liquidation value $250 per share; 0 and 460,000 shares issued and outstanding at December 31, 2006 and December 31, 2005, respectively |
|
9/9/06 |
|
N/A |
|
|
(5) |
$ |
— |
|
$ |
115,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
8.60% Series D Cumulative Redeemable Preferred; liquidation value $250 per share; 700,000 shares issued and outstanding at December 31, 2006 and December 31, 2005 (4) |
|
7/15/07 |
|
N/A |
|
$ |
21.50 |
|
175,000 |
|
175,000 |
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
7.00% Series E Cumulative Convertible Preferred; liquidation value $25 per share; 434,816 and 529,096 shares issued and outstanding at December 31, 2006 and December 31, 2005, respectively |
|
11/1/98 |
|
1.1128 |
|
$ |
1.75 |
|
10,871 |
|
13,228 |
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
7.00% Series H Cumulative Convertible Preferred; liquidation value $25 per share; 28,134 and 34,734 shares issued and outstanding at December 31, 2006 and December 31, 2005, respectively |
|
6/30/98 |
|
1.4480 |
|
$ |
1.75 |
|
703 |
|
868 |
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
8.29% Series K Cumulative Redeemable Preferred; liquidation value $50 per share; 1,000,000 shares issued and outstanding at December 31, 2006 and December 31, 2005 |
|
12/10/26 |
|
N/A |
|
$ |
4.145 |
|
50,000 |
|
50,000 |
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
6.48% Series N Cumulative Redeemable Preferred; liquidation value $250 per share; 600,000 shares issued and outstanding at December 31, 2006 and December 31, 2005 (4) |
|
6/19/08 |
|
N/A |
|
$ |
16.20 |
|
150,000 |
|
150,000 |
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
$ |
386,574 |
|
$ |
504,096 |
|
|
(1) On or after the redemption date, redeemable preferred shares (Series D, K and N) may be redeemed for cash at the option of the Company, in whole or in part, at a redemption price equal to the liquidation price per share, plus accrued and unpaid distributions, if any.
(2) On or after the redemption date, convertible preferred shares (Series E & H) may be redeemed under certain circumstances at the option of the Company for cash (in the case of Series E) or Common Shares (in the case of Series H), in whole or in part, at various redemption prices per share based upon the contractual conversion rate, plus accrued and unpaid distributions, if any.
F-21
(3) Dividends on all series of Preferred Shares are payable quarterly at various pay dates. Dividend rates listed for Series D and N are Preferred Share rates and the equivalent Depositary Share annual dividends are $2.15 and $1.62 per share, respectively.
(4) Series D and N Preferred Shares each have a corresponding depositary share that consists of ten times the number of shares and one-tenth the liquidation value and dividend per share.
(5) On August 9, 2006, the Company issued an irrevocable notice to redeem for cash on September 11, 2006 all 460,000 shares of its 9 1/8% Series C Preferred Shares. The Company recorded approximately $4.0 million as a premium on redemption of Preferred Shares in the accompanying consolidated statements of operations.
During the year ended December 31, 2005, the Company redeemed for cash all 500,000 shares of its Series B Preferred Shares with a liquidation value of $125.0 million. Additionally, the Company recorded the write-off of approximately $4.3 million in original issuance costs as a premium on redemption of Preferred Shares in the accompanying consolidated statements of operations.
The following table presents the issued and outstanding Preference Interests as of December 31, 2006 and December 31, 2005:
|
|
|
|
|
|
|
Annual
|
|
Amounts in thousands |
|
|||||
|
|
|
Redemption
|
|
Conversion
|
|
per Unit
|
|
December
|
|
December
|
|
|||
|
Preference Interests: |
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
7.875% Series G Cumulative Redeemable Preference Units; liquidation value $50 per unit; 0 and 510,000 units issued and outstanding at December 31, 2006 and December 31, 2005, respectively |
|
03/21/06 |
|
N/A |
|
|
(4) |
$ |
— |
|
$ |
25,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
7.625% Series H Cumulative Convertible Redeemable Preference Units; liquidation value $50 per unit; 0 and 190,000 units issued and outstanding at December 31, 2006 and December 31, 2005, respectively |
|
03/23/06 |
|
1.5108 |
|
|
(5) |
— |
|
9,500 |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
7.625% Series I Cumulative Convertible Redeemable Preference Units; liquidation value $50 per unit; 0 and 270,000 units issued and outstanding at December 31, 2006 and December 31, 2005, respectively |
|
06/22/06 |
|
1.4542 |
|
|
(6) |
— |
|
13,500 |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
7.625% Series J Cumulative Convertible Redeemable Preference Units; liquidation value $50 per unit; 230,000 units issued and outstanding at December 31, 2006 and December 31, 2005 |
|
12/14/06 |
|
1.4108 |
|
$ |
3.8125 |
|
11,500 |
|
11,500 |
|
||
|
|
|
|
|
|
|
|
|
$ |
11,500 |
|
$ |
60,000 |
|
|
(1) On or after the fifth anniversary of the respective issuance (the “Redemption Date”), all of the Preference Interests may be redeemed for cash at the option of the Company, in whole or in part, at any time or from time to time, at a redemption price equal to the liquidation preference of $50.00 per unit plus the cumulative amount of accrued and unpaid distributions, if any.
(2) On or after the tenth anniversary of the respective issuance (the “Conversion Date”), all of the Preference Interests are exchangeable at the option of the holder (in whole but not in part) on a one-for-one basis for a respective reserved series of EQR Preferred Shares. In addition, on or after the Conversion Date, the convertible Preference Interests may be converted under certain circumstances at the option of the holder (in whole but not in part) to Common Shares based upon the contractual conversion rate, plus accrued and unpaid distributions, if any. Prior to the Conversion Date, the convertible Preference Interests may be converted under certain circumstances at the option of the holder (in whole but not in part) to Common Shares based upon the contractual conversion rate, plus accrued and unpaid distributions, if any, if the issuer has called the series for redemption (the “Accelerated Conversion Right”).
(3) Dividends on all series of Preference Interests are payable quarterly on March 25 th , June 25 th , September 25 th , and December 25 th of each year.
(4) On February 15, 2006, the Company issued an irrevocable notice to redeem for cash on March 21, 2006 all 510,000 units of its 7.875% Series G Preference Interests with a liquidation value of $25.5 million. The company recorded approximately $0.7 million as a premium on redemption of Preference Interests (Minority Interests) in the accompanying consolidated statements of operations.
F-22
(5) On February 15, 2006, the Company issued an irrevocable notice to redeem for cash on March 23, 2006 all 190,000 units of its 7.625% Series H Preference Interests with a liquidation value of $9.5 million. This notice triggered the holder’s Accelerated Conversion Right, which they exercised. As a result, effective March 23, 2006, the 190,000 units were converted to 287,052 Common Shares.
(6) On May 16, 2006, the Company issued an irrevocable notice to redeem for cash on June 22, 2006 all 270,000 units of its 7.625% Series I Preference Interests with a liquidation value of $13.5 million. This notice triggered the holder’s Accelerated Conversion Right, which they exercised. As a result, effective June 22, 2006, the 270,000 units were converted to 392,634 Common Shares.
During the year ended December 31, 2005, the Company redeemed or repurchased for cash all of its Series B through F Preference Interests with a liquidation value of $146.0 million. The Company recorded approximately $4.1 million as premiums on redemption of Preference Interests (Minority Interests) in the accompanying consolidated statements of operations, which included $3.8 million in original issuance costs and $0.3 million in cash redemption charges.
During the year ended December 31, 2004, the Company redeemed for cash all 800,000 units of it 8.00% Series A Preference Interests with a liquidation value of $40.0 million. The Company recorded approximately $1.1 million as premiums on redemption of Preference Interests (Minority Interests) in the accompanying consolidated statements of operations.
The following table presents the Operating Partnership’s issued and outstanding Junior Convertible Preference Units (the “Junior Preference Units”) as of December 31, 2006 and December 31, 2005:
|
|
|
|
|
|
|
Annual
|
|
Amounts in thousands |
|
|||||
|
|
|
Redemption
|
|
Conversion
|
|
per Unit
|
|
December
|
|
December
|
|
|||
|
Junior Preference Units: |
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Series B Junior Convertible Preference Units; liquidation value $25 per unit; 7,367 units issued and outstanding at December 31, 2006 and December 31, 2005 |
|
07/29/09 |
|
1.020408 |
|
$ |
2.00 |
|
$ |
184 |
|
$ |
184 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
$ |
184 |
|
$ |
184 |
|
|
(1) Dividends on the Junior Preference Units are payable quarterly at various pay dates.
(2) On or after the tenth anniversary of the issuance (the “Redemption Date”), the Series B Junior Preference Units may be converted into OP Units at the option of the Operating Partnership based on the contractual conversion rate. Prior to the Redemption Date, the holders may elect to convert the Series B Junior Preference Units to OP Units under certain circumstances based on the contractual conversion rate. The contractual rate is based upon a ratio dependent upon the closing price of EQR’s Common Shares.
4. Real Estate
The following table summarizes the carrying amounts for investment in real estate (at cost) as of December 31, 2006 and 2005 (Amounts in thousands) :
F-23
|
|
|
2006 |
|
2005 |
|
||
|
Land |
|
$ |
3,217,672 |
|
$ |
2,848,601 |
|
|
Depreciable property: |
|
|
|
|
|
||
|
Buildings and improvements |
|
12,563,807 |
|
12,583,020 |
|
||
|
Furniture, fixtures and equipment |
|
812,552 |
|
753,616 |
|
||
|
Projects under development: |
|
|
|
|
|
||
|
Land |
|
125,496 |
|
90,261 |
|
||
|
Construction-in-progress |
|
261,421 |
|
150,719 |
|
||
|
Land held for development: |
|
|
|
|
|
||
|
Land |
|
214,704 |
|
148,234 |
|
||
|
Construction-in-progress |
|
39,523 |
|
15,919 |
|
||
|
Investment in real estate |
|
17,235,175 |
|
16,590,370 |
|
||
|
Accumulated depreciation |
|
(3,022,480 |
) |
(2,888,140 |
) |
||
|
Investment in real estate, net |
|
$ |
14,212,695 |
|
$ |
13,702,230 |
|
During the year ended December 31, 2006, the Company acquired the entire equity interest in 35 properties containing 8,768 units and nine land parcels from unaffiliated parties for a total purchase price of $1.9 billion. The Company also acquired the majority of its partners’ interest in eighteen partially owned properties containing 1,643 units for $56.6 million, partially funded through the issuance of 417,039 OP Units valued at $18.6 million.
The Company adopted EITF Issue No. 04-5, as required for existing limited partnership arrangements, effective January 1, 2006. The adoption required the consolidation of the Lexford syndicated portfolio consisting of 20 separate partnerships (10 properties) containing 1,272 units, all of which were sold October 5, 2006. The Company recorded $24.6 million in investment in real estate and also:
• Consolidated $22.5 million in mortgage debt;
• Reduced investments in unconsolidated entities by $2.6 million;
• Consolidated $0.9 million of other liabilities net of other assets acquired; and
• Consolidated $1.4 million of cash.
During the year ended December 31, 2005, the Company acquired the entire equity interest in forty-one properties containing 12,059 units, inclusive of one additional unit at one existing property, and seven land parcels from unaffiliated parties for a total purchase price of $2.7 billion.
During the year ended December 31, 2005, the Company also acquired a majority interest in the remaining equity interests it did not previously own in sixteen Partially Owned Properties, all of which remain partially owned. The acquisitions were funded using $24.2 million in cash and through the issuance of 614,717 OP Units valued at $20.8 million, with $43.0 million recorded as additional building basis and $2.0 million recorded as a reduction of Minority Interests – Partially Owned Properties. The Company also acquired the majority of the remaining third party equity interests it did not previously own in three properties, consisting of 211 units. The properties were previously accounted for under the equity method of accounting and subsequent to each purchase were consolidated. The Company recorded $5.6 million in investment in real estate and also:
• Assumed $2.8 million in mortgage debt;
• Reduced investments in unconsolidated entities by $1.2 million;
• Assumed $1.5 million of other liabilities net of other assets acquired; and
• Paid cash of $0.1 million (net of cash acquired).
During the year ended December 31, 2006, the Company disposed of the following to unaffiliated parties (sales price in thousands):
F-24
|
|
|
Properties |
|
Units |
|
Sales Price |
|
|
|
Rental Properties |
|
335 |
|
39,608 |
|
$ |
2,255,442 |
|
|
Condominium Units |
|
5 |
|
1,069 |
|
215,972 |
|
|
|
Land Parcels (two) |
|
— |
|
— |
|
1,569 |
|
|
|
|
|
340 |
|
40,677 |
|
$ |
2,472,983 |
|
The Company recognized a net gain on sales of discontinued operations of approximately $1.0 billion (amount is net of $3.2 million of income taxes incurred on condominium sales – see additional discussion in Note 2), a net gain on sales of land parcels of approximately $2.8 million and a net gain on sales of unconsolidated entities of $0.4 million on the above sales.
On June 28, 2006, the Company announced that it agreed to sell its Lexford Housing Division for a cash purchase price of $1.086 billion. The sale closed on October 5, 2006. The Lexford Housing Division results are classified as discontinued operations, net of minority interests, in the consolidated statements of operations for all periods presented. The Company recorded a gain on sale of approximately $418.7 million on the sale of the Lexford Housing Division in the fourth quarter of 2006. In conjunction with the Lexford disposition, the Company paid off/extinguished $196.3 million of mortgage notes payable secured by the properties and incurred approximately $9.2 million in prepayment penalties upon extinguishment. The Company also recorded approximately $4.5 million in one-time accrued retention benefits during the third quarter of 2006 related to the Lexford disposition. These costs are included in discontinued operations, net of minority interests, in the consolidated statements of operations. See Note 13 for additional information.
During the year ended December 31, 2005, the Company disposed of the following to unaffiliated parties (sales price in thousands):
|
|
|
Properties |
|
Units |
|
Sales Price |
|
|
|
Rental Properties |
|
50 |
|
12,848 |
|
$ |
1,351,636 |
|
|
Condominium Units |
|
6 |
|
2,241 |
|
593,305 |
|
|
|
Land Parcels (five) |
|
— |
|
— |
|
108,280 |
|
|
|
|
|
56 |
|
15,089 |
|
$ |
2,053,221 |
|
The Company recognized a net gain on sales of discontinued operations of approximately $697.7 million (amount is net of $8.8 million of income taxes incurred on condominium sales – see additional discussion in Note 2), a net gain on sales of land parcels of approximately $30.2 million and a net gain on the sales of unconsolidated entities of $1.3 million on the above sales.
5. Commitments to Acquire/Dispose of Real Estate
As of February 7, 2007, in addition to the properties that were subsequently acquired as discussed in Note 21, the Company had entered into separate agreements to acquire the following (purchase price in thousands):
|
|
|
Properties/
|
|
Units |
|
Purchase
|
|
|
|
Operating Properties |
|
5 |
|
1,564 |
|
$ |
410,850 |
|
|
Land Parcels |
|
4 |
|
— |
|
88,552 |
|
|
|
Total |
|
9 |
|
1,564 |
|
$ |
499,402 |
|
As of February 7, 2007, in addition to the property that was subsequently disposed of as discussed in Note 21, the Company had entered into separate agreements to dispose of the following (sales price in thousands):
F-25
|
|
|
Properties/
|
|
Units |
|
Sales
|
|
|
|
Operating Properties |
|
13 |
|
4,365 |
|
$ |
319,130 |
|
|
Land Parcels |
|
1 |
|
— |
|
4,000 |
|
|
|
Total |
|
14 |
|
4,365 |
|
$ |
323,130 |
|
The closings of these pending transactions are subject to certain conditions and restrictions, therefore, there can be no assurance that these transactions will be consummated or that the final terms will not differ in material respects from those summarized in the preceding paragraphs.
6. Investments in Partially Owned Entities
The Company has co-invested in various properties with unrelated third parties which are either consolidated or accounted for under the equity method of accounting (unconsolidated). The following table summarizes the Company’s investments in partially owned entities as of December 31, 2006 (amounts in thousands except for project and unit amounts):
|
|
|
Consolidated |
|
Unconsolidated |
|
|||||||||||
|
|
|
Development Projects |
|
|
|
|
|
|
|
|||||||
|
|
|
Held for
|
|
Completed and
|
|
Other |
|
Total |
|
Institutional
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Total projects (1) |
|
— |
|
4 |
|
21 |
|
25 |
|
45 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Total units (1) |
|
— |
|
977 |
|
3,896 |
|
4,873 |
|
10,846 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Debt – Secured (2): |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
EQR Ownership (3) |
|
$ |
159,154 |
|
$ |
61,000 |
|
$ |
287,022 |
|
$ |
507,176 |
|
$ |
121,200 |
|
|
Minority Ownership |
|
— |
|
— |
|
13,321 |
|
13,321 |
|
363,600 |
|
|||||
|
Total (at 100%) |
|
$ |
159,154 |
|
$ |
61,000 |
|
$ |
300,343 |
|
$ |
520,497 |
|
$ |
484,800 |
|
(1) Project and unit counts exclude all uncompleted development projects until those projects are completed.
(2) All debt is non-recourse to the Company with the exception of $28.3 million in mortgage bonds on one development project.
(3) Represents the Company’s economic ownership interest.
7. Deposits - Restricted
The following table presents the restricted deposits as of December 31, 2006 and 2005 (amounts in thousands):
|
|
|
December
|
|
December
|
|
||
|
|
|
|
|
|
|
||
|
Tax–deferred (1031) exchange proceeds |
|
$ |
299,392 |
|
$ |
853 |
|
|
Earnest money on pending acquisitions |
|
13,170 |
|
15,120 |
|
||
|
Resident security, utility and other |
|
79,263 |
|
61,120 |
|
||
|
|
|
|
|
|
|
||
|
Totals |
|
$ |
391,825 |
|
$ |
77,093 |
|
8. Mortgage Notes Payable
As of December 31, 2006, the Company had outstanding mortgage debt of approximately $3.2 billion.
F-26
!
During the year ended December 31, 2006, the Company:
• Repaid $493.0 million of mortgage loans;
• Assumed/consolidated $149.5 million of mortgage debt on certain properties in connection with their acquisition and/or consolidation;
• Obtained $267.0 million of new mortgage loans on certain properties; and
• Was released from $117.9 million of mortgage debt assumed by the purchaser on disposed properties.
As of December 31, 2006, scheduled maturities for the Company’s outstanding mortgage indebtedness were at various dates through September 1, 2045. At December 31, 2006, the interest rate range on the Company’s mortgage debt was 3.32% to 12.465%. During the year ended December 31, 2006, the weighted average interest rate on the Company’s mortgage debt was 5.82%.
The historical cost, net of accumulated depreciation, of encumbered properties was $4.7 billion and $4.8 billion at December 31, 2006 and 2005, respectively.
Aggregate payments of principal on mortgage notes payable for each of the next five years and thereafter are as follows (amounts in thousands):
|
Year |
|
Total |
|
|
|
2007 |
|
$ |
307,941 |
|
|
2008 |
|
420,583 |
|
|
|
2009 |
|
540,679 |
|
|
|
2010 |
|
279,688 |
|
|
|
2011 |
|
529,601 |
|
|
|
Thereafter |
|
1,099,731 |
|
|
|
Total |
|
$ |
3,178,223 |
|
As of December 31, 2005, the Company had outstanding mortgage indebtedness of approximately $3.4 billion.
During the year ended December 31, 2005, the Company:
• Repaid $470.4 million of mortgage loans;
• Assumed/consolidated $446.3 million of mortgage debt on certain properties in connection with their acquisition and/or consolidation;
• Obtained $280.1 million of new mortgage loans on certain properties; and
• Was released from $35.0 million of mortgage debt assumed by the purchaser on disposed properties.
As of December 31, 2005, scheduled maturities for the Company’s outstanding mortgage indebtedness were at various dates through February 1, 2041. At December 31, 2005, the interest rate range on the Company’s mortgage debt was 3.35% to 12.465%. During the year ended December 31, 2005, the weighted average interest rate on the Company’s mortgage debt was 5.63%.
9. Notes
The following tables summarize the Company’s unsecured note balances and certain interest rate and maturity date information as of and for the years ended December 31, 2006 and 2005, respectively:
F-27
|
December 31, 2006
|
|
Net Principal
|
|
Interest Rate
|
|
Weighted
|
|
Maturity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed Rate Public/Private Notes (1) |
|
$ |
4,158,043 |
|
3.85% - 7.625% |
|
5.90 |
% |
2007 - 2026 |
|
|
Floating Rate Public Notes (1) |
|
150,000 |
|
(1) |
|
6.13 |
% |
2009 |
|
|
|
Fixed Rate Tax-Exempt Bonds |
|
111,390 |
|
4.75% - 5.20% |
|
5.06 |
% |
2028 - 2029 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals |
|
$ |
4,419,433 |
|
|
|
|
|
|
|
(1) $150.0 million in fair value interest rate swaps converts 50% of the $300.0 million 4.750% notes due June 15, 2009 to a floating interest rate.
|
December 31, 2005
|
|
Net Principal
|
|
Interest Rate
|
|
Weighted
|
|
Maturity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed Rate Public/Private Notes |
|
$ |
3,331,394 |
|
4.75% - 7.625% |
|
6.13 |
% |
2006 - 2026 |
|
|
Fixed Rate Tax-Exempt Bonds |
|
111,390 |
|
4.75% - 5.20% |
|
5.06 |
% |
2028 - 2029 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals |
|
$ |
3,442,784 |
|
|
|
|
|
|
|
The Company’s unsecured public debt contains certain financial and operating covenants including, among other things, maintenance of certain financial ratios. The Company was in compliance with its unsecured public debt covenants for both the years ended December 31, 2006 and 2005.
As of February 7, 2007, an unlimited amount of debt securities remains available for issuance by the Operating Partnership under a registration statement that became automatically effective upon filing with the SEC in June 2006 (under SEC regulations enacted in 2005, the registration statement automatically expires on June 29, 2009 and does not contain a maximum issuance amount).
During the year ended December 31, 2006, the Company:
• Issued $400.0 million of ten and one-half year 5.375% fixed-rate public notes, receiving net proceeds of $395.5 million;
• Issued $650.0 million of twenty year 3.85% fixed rate public notes that are exchangeable into EQR Common Shares, receiving net proceeds of $637.0 million (see further discussion below);
• Repaid $60.0 million of fixed-rate public notes at maturity; and
• Repaid $4.3 million of other unsecured notes.
On August 23, 2006, the Operating Partnership issued $650.0 million of exchangeable senior notes that mature on August 15, 2026. The notes bear interest at a fixed rate of 3.85%. The notes are exchangeable into EQR Common Shares, at the option of the holders, under specific circumstances or on or after August 15, 2025, at an initial exchange rate of 16.3934 shares per $1,000 principal amount of notes (equivalent to an initial exchange price of $61.00 per share). The initial exchange rate is subject to adjustment in certain circumstances, including upon an increase in the Company’s dividend rate. Upon an exchange of the notes, the Operating Partnership will settle any amounts up to the principal amount of the notes in cash and the remaining exchange value, if any, will be settled, at the Operating Partnership’s option, in cash, EQR Common Shares or a combination of both.
On or after August 18, 2011, the Operating Partnership may redeem the notes at a redemption price equal to the principal amount of the notes plus any accrued and unpaid interest thereon. Upon notice of redemption by the Operating Partnership, the holders may elect to exercise their exchange rights In addition, on August 18, 2011,
F-28
August 15, 2016 and August 15, 2021 or following the occurrence of certain change in control transactions prior to August 18, 2011, note holders may require the Operating Partnership to repurchase the notes for an amount equal to the principal amount of the notes plus any accrued and unpaid interest thereon.
Note holders may also require an exchange of the notes should the closing sale price of Common Shares exceed 130% of the exchange price for a certain period of time or should the trading price on the notes be less than 98% of the product of the closing sales price of Common Shares multiplied by the applicable exchange rate for a certain period of time.
During the year ended December 31, 2005, the Company:
• Issued $500.0 million of ten and one-half year 5.125% fixed-rate public notes, receiving net proceeds of $496.2 million;
• Had $300.0 million in fixed rate public notes remarketed as originally contemplated in a remarketing agreement entered into in connection with the original issuance of the notes, with the interest rate changing from 6.63% to 6.584% effective April 14, 2005 (notes still mature on April 13, 2015);
• Repaid $190.0 million of fixed rate public notes at maturity; and
• Repaid $4.3 million of other unsecured notes.
Aggregate payments of principal on unsecured notes payable for each of the next five years and thereafter are as follows (amounts in thousands):
|
Year |
|
Total |
|
|
|
2007 |
|
$ |
153,522 |
|
|
2008 |
|
129,251 |
|
|
|
2009 |
|
294,838 |
|
|
|
2010 (1) |
|
(365 |
) |
|
|
2011 (2) |
|
942,994 |
|
|
|
Thereafter |
|
2,899,193 |
|
|
|
Total |
|
$ |
4,419,433 |
|
(1) Principal payments on unsecured notes includes amortization of any discounts or premiums related to the notes. Premiums and discounts are amortized over the life of the unsecured notes.
(2) Includes the $650.0 million of 3.85% convertible unsecured debt with a final maturity of 2026.
10. Lines of Credit
The Operating Partnership has an unsecured revolving credit facility with potential borrowings of up to $1.0 billion maturing on May 29, 2008, with the ability to increase available borrowings by an additional $500.0 million under certain circumstances. Advances under the credit facility bear interest at variable rates based upon LIBOR at various interest periods plus a spread dependent upon the Operating Partnership’s credit rating or based on bids received from the lending group. EQR has guaranteed the Operating Partnership’s credit facility up to the maximum amount and for its full term.
On August 30, 2005, the Operating Partnership entered into a one-year $600.0 million revolving credit facility maturing on August 29, 2006. This credit facility was repaid in full and terminated on January 20, 2006.
On July 6, 2006, the Operating Partnership entered into a one-year $500.0 million revolving credit facility maturing on July 6, 2007. This facility was repaid in full and terminated on October 13, 2006. Advances under this facility bore interest at variable rates based on LIBOR at various interest periods plus a spread dependent upon the Operating Partnership’s credit rating. EQR guaranteed this credit facility up to the maximum amount and for its full term.
F-29
As of December 31, 2006 and 2005, $460.0 million and $769.0 million, respectively, was outstanding and $69.3 million and $50.2 million, respectively, was restricted (dedicated to support letters of credit and not available for borrowing) on the credit facilities. During the years ended December 31, 2006 and 2005, the weighted average interest rates were 5.40% and 3.80%, respectively.
11. Derivative Instruments
The following table summarizes the consolidated derivative instruments at December 31, 2006 (dollar amounts are in thousands):
|
|
|
Fair Value
|
|
Forward Starting
|
|
Development Cash
|
|
|||
|
Current Notional Balance |
|
$ |
370,000 |
|
$ |
100,000 |
|
$ |
40,775 |
|
|
Lowest Possible Notional |
|
$ |
370,000 |
|
$ |
100,000 |
|
$ |
13,925 |
|
|
Highest Possible Notional |
|
$ |
370,000 |
|
$ |
100,000 |
|
$ |
46,296 |
|
|
Lowest Interest Rate |
|
3.245 |
% |
5.596 |
% |
4.530 |
% |
|||
|
Highest Interest Rate |
|
3.787 |
% |
5.596 |
% |
4.530 |
% |
|||
|
Earliest Maturity Date |
|
2009 |
|
2017 |
|
2007 |
|
|||
|
Latest Maturity Date |
|
2009 |
|
2017 |
|
2007 |
|
|||
|
Estimated Asset (Liability) Fair Value |
|
$ |
(13,130 |
) |
$ |
(3,122 |
) |
$ |
57 |
|
(1) Fair Value Hedges – Converts outstanding fixed rate debt to a floating interest rate.
(2) Forward Starting Swaps – Designed to partially fix the interest rate in advance of a planned future debt issuance.
(3) Development Cash Flow Hedges – Converts outstanding floating rate debt to a fixed interest rate.
On December 31, 2006, the net derivative instruments were reported at their fair value as other assets of approximately $0.1 million and as other liabilities of approximately $16.3 million. As of December 31, 2006, there were approximately $14.6 million in deferred losses, net, included in accumulated other comprehensive loss. Based on the estimated fair values of the net derivative instruments at December 31, 2006, the Company may recognize an estimated $2.4 million of accumulated other comprehensive loss as additional interest expense during the year ending December 31, 2007.
In January 2006, the Company received approximately $10.7 million to terminate six forward starting swaps in conjunction with the issuance of $400.0 million of ten and one-half year unsecured notes. The $10.7 million has been deferred as a component of accumulated other comprehensive loss and will be recognized as a reduction of interest expense over the life of the unsecured notes.
12. Earnings Per Share
The following tables set forth the computation of net income per share – basic and net income per share – diluted (amounts in thousands except per share amounts):
|
|
|
Year Ended December 31, |
|
|||||||
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
Numerator for net income per share – basic: |
|
|
|
|
|
|
|
|||
|
Income from continuing operations, net of minority interests |
|
$ |
100,532 |
|
$ |
147,323 |
|
$ |
88,778 |
|
|
Preferred distributions |
|
(37,113 |
) |
(49,642 |
) |
(53,746 |
) |
|||
|
Premium on redemption of Preferred Shares |
|
(3,965 |
) |
(4,359 |
) |
— |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Income from continuing operations available to Common Shares, net of minority interests |
|
59,454 |
|
93,322 |
|
35,032 |
|
|||
|
Discontinued operations, net of minority interests |
|
972,312 |
|
714,470 |
|
383,551 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Numerator for net income per share – basic |
|
$ |
1,031,766 |
|
$ |
807,792 |
|
$ |
418,583 |
|
F-30
|
|
|
Year Ended December 31, |
|
|||||||
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
Numerator for net income per share – diluted: |
|
|
|
|
|
|
|
|||
|
Income from continuing operations, net of minority interests |
|
$ |
100,532 |
|
$ |
147,323 |
|
$ |
88,778 |
|
|
Preferred distributions |
|
(37,113 |
) |
(49,642 |
) |
(53,746 |
) |
|||
|
Premium on redemption of Preferred Shares |
|
(3,965 |
) |
(4,359 |
) |
— |
|
|||
|
Effect of dilutive securities: |
|
|
|
|
|
|
|
|||
|
Allocation to Minority Interests – Operating Partnership, net |
|
4,201 |
|
6,796 |
|
2,624 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Income from continuing operations available to Common Shares |
|
63,655 |
|
100,118 |
|
37,656 |
|
|||
|
Discontinued operations |
|
1,040,685 |
|
766,188 |
|
412,155 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Numerator for net income per share – diluted |
|
$ |
1,104,340 |
|
$ |
866,306 |
|
$ |
449,811 |
|
|
|
|
|
|
|
|
|
|
|||
|
Denominator for net income per share – basic and diluted: |
|
|
|
|
|
|
|
|||
|
Denominator for net income per share – basic |
|
290,019 |
|
285,760 |
|
279,744 |
|
|||
|
Effect of dilutive securities: |
|
|
|
|
|
|
|
|||
|
OP Units |
|
20,433 |
|
20,819 |
|
20,939 |
|
|||
|
Share options/restricted shares |
|
5,127 |
|
4,206 |
|
3,188 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Denominator for net income per share – diluted |
|
315,579 |
|
310,785 |
|
303,871 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Net income per share – basic |
|
$ |
3.56 |
|
$ |
2.83 |
|
$ |
1.50 |
|
|
|
|
|
|
|
|
|
|
|||
|
Net income per share – diluted |
|
$ |
3.50 |
|
$ |
2.79 |
|
$ |
1.48 |
|
|
|
|
|
|
|
|
|
|
|||
|
Net income per share – basic: |
|
|
|
|
|
|
|
|||
|
Income from continuing operations available to Common Shares, net of minority interests |
|
$ |
0.205 |
|
$ |
0.327 |
|
$ |
0.125 |
|
|
Discontinued operations, net of minority interests |
|
3.353 |
|
2.500 |
|
1.371 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Net income per share – basic |
|
$ |
3.558 |
|
$ |
2.827 |
|
$ |
1.496 |
|
|
|
|
|
|
|
|
|
|
|||
|
Net income per share – diluted: |
|
|
|
|
|
|
|
|||
|
Income from continuing operations available to Common Shares |
|
$ |
0.202 |
|
$ |
0.322 |
|
$ |
0.124 |
|
|
Discontinued operations |
|
3.298 |
|
2.466 |
|
1.356 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Net income per share – diluted |
|
$ |
3.500 |
|
$ |
2.788 |
|
$ |
1.480 |
|
Convertible preferred shares/units that could be converted into 1,163,908, 1,772,048 and 3,215,472 weighted average Common Shares for the years ended December 31, 2006, 2005 and 2004, respectively, were outstanding but were not included in the computation of diluted earnings per share because the effects would be anti-dilutive. In addition, the effect of the Common Shares that could ultimately be issued upon the conversion/exchange of the Operating Partnership’s $650.0 million exchangeable senior notes were not included in the computation of diluted earnings per share because the effects would be anti-dilutive.
For additional disclosures regarding the employee share options and restricted shares, see Notes 2 and 14.
13. Discontinued Operations
The Company has presented separately as discontinued operations in all periods the results of operations for all consolidated assets disposed of on or after January 1, 2002 (the date of adoption of SFAS No. 144), all operations related to condominium conversion properties effective upon their respective transfer into a TRS and all properties held for sale.
The components of discontinued operations are outlined below and include the results of operations for the respective periods that the Company owned such assets during each of the years ended December 31, 2006, 2005, and 2004 (amounts in thousands).
F-31
|
|
|
Year Ended December 31, |
|
|||||||
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
REVENUES |
|
|
|
|
|
|
|
|||
|
Rental income |
|
$ |
173,907 |
|
$ |
365,492 |
|
$ |
458,431 |
|
|
Fee and asset management |
|
— |
|
908 |
|
1,053 |
|
|||
|
Total revenues |
|
173,907 |
|
366,400 |
|
459,484 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
EXPENSES (1) |
|
|
|
|
|
|
|
|||
|
Property and maintenance |
|
65,871 |
|
120,104 |
|
148,452 |
|
|||
|
Real estate taxes and insurance |
|
20,028 |
|
46,069 |
|
53,852 |
|
|||
|
Property management |
|
8,695 |
|
10,409 |
|
9,706 |
|
|||
|
Depreciation |
|
29,898 |
|
89,364 |
|
115,910 |
|
|||
|
General and administrative |
|
579 |
|
1,142 |
|
974 |
|
|||
|
Impairment |
|
351 |
|
— |
|
— |
|
|||
|
Total expenses |
|
125,422 |
|
267,088 |
|
328,894 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Discontinued operating income |
|
48,485 |
|
99,312 |
|
130,590 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Interest and other income |
|
1,507 |
|
1,411 |
|
376 |
|
|||
|
Interest (2): |
|
|
|
|
|
|
|
|||
|
Expense incurred, net |
|
(24,918 |
) |
(31,527 |
) |
(35,792 |
) |
|||
|
Amortization of deferred financing costs |
|
(832 |
) |
(663 |
) |
(1,462 |
) |
|||
|
|
|
|
|
|
|
|
|
|||
|
Discontinued operations |
|
24,242 |
|
68,533 |
|
93,712 |
|
|||
|
Minority Interests – Operating Partnership |
|
(1,593 |
) |
(4,626 |
) |
(6,504 |
) |
|||
|
Discontinued operations, net of minority interests |
|
22,649 |
|
63,907 |
|
87,208 |
|
|||
|
Net gain on sales of discontinued operations |
|
1,016,443 |
|
697,655 |
|
318,443 |
|
|||
|
Minority Interests – Operating Partnership |
|
(66,780 |
) |
(47,092 |
) |
(22,100 |
) |
|||
|
Gain on sales of discontinued operations, net of minority interests |
|
949,663 |
|
650,563 |
|
296,343 |
|
|||
|
Discontinued operations, net of minority interests |
|
$ |
972,312 |
|
$ |
714,470 |
|
$ |
383,551 |
|
Note: Discontinued operations includes the Lexford Housing Division.
(1) Includes expenses paid in the current period for properties sold or held for sale in prior periods related to the Company’s period of ownership.
(2) Includes only interest expense specific to secured mortgage notes payable for properties sold and/or held for sale.
For the properties sold during 2006 (excluding condominium conversion properties), the investment in real estate, net of accumulated depreciation, and the mortgage notes payable balances at December 31, 2005 were $1.3 billion and $348.4 million, respectively.
The net real estate basis of the Company’s condominium conversion properties owned by the TRS and included in discontinued operations (excludes the Company’s five halted conversions as they are now held for use), which were included in investment in real estate, net in the consolidated balance sheets, was $95.4 million and $121.3 million at December 31, 2006 and 2005, respectively.
14. Share Incentive Plans
On May 15, 2002, the shareholders of EQR approved the Company’s 2002 Share Incentive Plan. The maximum aggregate number of awards that may be granted under this plan may not exceed 7.5% of the Company’s outstanding Common Shares calculated on a “fully diluted” basis and determined annually on
F-32
the first day of each calendar year. As of January 1, 2007, this amount equaled 23,574,211, of which 13,521,150 is available for future issuance. No awards may be granted under the 2002 Share Incentive Plan after February 20, 2012.
Pursuant to the 2002 Share Incentive Plan and the Fifth Amended and Restated 1993 Share Option and Share Award Plan (collectively the “Share Incentive Plans”), officers, trustees and key employees of the Company may be granted share options to acquire Common Shares (“Options”) including non-qualified share options (“NQSOs”), incentive share options (“ISOs”) and share appreciation rights (“SARs”), or may be granted restricted or non-restricted shares, subject to conditions and restrictions as described in the Share Incentive Plans. Finally, certain executive officers of the Company participate in the Company’s performance based restricted share plan. Options, SARs, restricted shares and performance shares are sometimes collectively referred to herein as “Awards”.
The Options are generally granted at the fair market value of the Company’s Common Shares at the date of grant, vest in three equal installments over a three year period, are exercisable upon vesting and expire ten years from the date of grant. The exercise price for all Options under the Share Incentive Plans is equal to the fair market value of the underlying Common Shares at the time the Option is granted. The Fifth Amended and Restated 1993 Share Option and Share Award Plan will terminate at such time as all outstanding Awards have expired or have been exercised/vested. The Board of Trustees may at any time amend or terminate the Share Incentive Plans, but termination will not affect Awards previously granted. Any Options which had vested prior to such a termination would remain exercisable by the holder.
As to the restricted shares that have been awarded through December 31, 2006, these shares generally vest three years from the award date. During the three-year period of restriction, the Company’s unvested restricted shareholders receive quarterly dividend payments on their shares at the same rate and on the same date as any other Common Share holder. In addition, the Company’s unvested restricted shareholders have the same voting rights as any other Common Share holder. As a result, dividends paid on unvested restricted shares are included as a component of retained earnings (deficit) and have not been considered in reducing net income available to Common Shares in a manner similar to the Company’s preferred share dividends for the earnings per share calculation. If employment is terminated prior to the lapsing of the restriction, the shares are generally canceled.
In addition, each year prior to 2007, selected executive officers of the Company received performance-based awards. Effective January 1, 2007, the Company has elected to discontinue the award of new performance-based award grants. The executive officers have the opportunity to earn in Common Shares an amount as little as 0% to as much as 225% of the target number of performance-based awards. The owners of performance-based awards have no right to vote, receive dividends or transfer the awards until Common Shares are issued in exchange for the awards. The number of Common Shares the executive officer actually receives on the third anniversary of the grant date will depend on the excess, if any, by which the Company’s Average Annual Return (i.e., the average of the Common Share dividends declared during each year as a percentage of the Common Share price as of the first business day of the first performance year and the average percentage increase in funds from operations (“FFO”) for each calendar year on a per share basis over the prior year) for the three performance years exceeds the average of the 10-year Treasury Note interest rate as of the first business day in January of each performance year (the “T-Note Rate”).
F-33
|
If the Company’s Average Annual Return exceeds the T-Note Rate by: |
|
Less
|
|
1-1.99% |
|
2% |
|
3% |
|
4% |
|
5% |
|
6% |
|
Greater
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Then
the executive officer will receive Common Shares equal to the target number
of awards times the
|
|
0% |
|
50% |
|
100% |
|
115% |
|
135% |
|
165% |
|
190% |
|
225% |
If the Company’s Average Annual Return exceeds the T-Note Rate by an amount which falls between any of the percentages in excess of the 2% threshold, the performance-based award will be determined by extrapolation between the two percentages. Fifty percent of the Common Shares to which an executive officer may be entitled under the performance share grants will vest, subject to the executive’s continued employment with the Company, on the third anniversary of the award (which will be the date the Common Shares are issued); twenty-five percent will vest on the fourth anniversary and the remaining twenty-five percent will vest on the fifth anniversary. The Common Shares will also fully vest upon the executive’s death, retirement at or after age 62, disability or upon a change in control of the Company.
The following tables summarize compensation information regarding the performance shares, restricted shares, share options and ESPP for the three years ended December 31, 2006, 2005 and 2004 (amounts in thousands):
|
|
|
Year Ended December 31, 2006 |
|
||||||||||
|
|
|
Compensation
|
|
Compensation
|
|
Compensation
|
|
Dividends
|
|
||||
|
Performance shares |
|
$ |
1,795 |
|
$ |
— |
|
$ |
1,795 |
|
$ |
— |
|
|
Restricted shares |
|
13,923 |
|
1,021 |
|
14,944 |
|
2,437 |
|
||||
|
Share options |
|
4,868 |
|
330 |
|
5,198 |
|
— |
|
||||
|
ESPP discount |
|
1,494 |
|
84 |
|
1,578 |
|
— |
|
||||
|
Total |
|
$ |
22,080 |
|
$ |
1,435 |
|
$ |
23,515 |
|
$ |
2,437 |
|
|
|
|
Year Ended December 31, 2005 |
|
Year Ended December 31, 2004 |
|
||||||||
|
|
|
Compensation
|
|
Dividends
|
|
Compensation
|
|
Dividends
|
|
||||
|
Performance shares |
|
$ |
7,697 |
|
$ |
— |
|
$ |
312 |
|
$ |
— |
|
|
Restricted shares |
|
20,055 |
|
2,743 |
|
12,242 |
|
2,508 |
|
||||
|
Share options |
|
6,562 |
|
— |
|
2,982 |
|
— |
|
||||
|
ESPP discount |
|
1,591 |
|
— |
|
1,290 |
|
— |
|
||||
|
Total |
|
$ |
35,905 |
|
$ |
2,743 |
|
$ |
16,826 |
|
$ |
2,508 |
|
Compensation expense is recognized for all Awards over the vesting period. The total compensation expense related to Awards not yet vested at December 31, 2006 is $23.7 million, which is expected to be recognized over a weighted average term of 1.6 years.
See Note 2 for additional information regarding the Company’s share-based compensation.
The table below summarizes the Award activity of the Share Incentive Plans and options assumed in connection with mergers (the “Merger Options”) for the three years ended December 31, 2006, 2005 and 2004:
F-34
|
|
|
Common Shares
|
|
Weighted Average
|
|
Restricted
|
|
Weighted
|
|
||
|
Balance at December 31, 2003 |
|
12,085,598 |
|
$ |
24.27 |
|
1,362,733 |
|
$ |
22.75 |
|
|
Awards granted (2002 plan) |
|
2,254,570 |
|
$ |
29.33 |
|
572,688 |
|
$ |
29.28 |
|
|
Awards exercised/vested (1993 plan) |
|
(2,920,057 |
) |
$ |
23.75 |
|
(457,127 |
) |
$ |
20.05 |
|
|
Awards exercised/vested (2002 plan) |
|
(423,866 |
) |
$ |
23.55 |
|
(7,973 |
) |
$ |
28.05 |
|
|
Merger Options exercised |
|
(6,836 |
) |
$ |
20.14 |
|
— |
|
— |
|
|
|
Awards canceled (1993 plan) |
|
(90,436 |
) |
$ |
23.44 |
|
(33,374 |
) |
$ |
25.25 |
|
|
Awards canceled (2002 plan) |
|
(79,751 |
) |
$ |
28.02 |
|
(23,692 |
) |
$ |
28.19 |
|
|
Balance at December 31, 2004 |
|
10,819,222 |
|
$ |
25.48 |
|
1,413,255 |
|
$ |
26.06 |
|
|
Awards granted (2002 plan) |
|
2,235,268 |
|
$ |
31.91 |
|
620,192 |
|
$ |
31.89 |
|
|
Awards exercised/vested (1993 plan) |
|
(1,630,321 |
) |
$ |
23.44 |
|
(373,310 |
) |
$ |
24.68 |
|
|
Awards exercised/vested (2002 plan) |
|
(611,943 |
) |
$ |
26.31 |
|
(190,938 |
) |
$ |
29.36 |
|
|
Merger Options exercised |
|
(6,480 |
) |
$ |
18.10 |
|
— |
|
— |
|
|
|
Awards canceled (1993 plan) |
|
(27,677 |
) |
$ |
24.53 |
|
(12,363 |
) |
$ |
23.64 |
|
|
Awards canceled (2002 plan) |
|
(205,326 |
) |
$ |
30.32 |
|
(87,008 |
) |
$ |
29.55 |
|
|
Balance at December 31, 2005 |
|
10,572,743 |
|
$ |
27.02 |
|
1,369,828 |
|
$ |
28.42 |
|
|
Awards granted (2002 plan) |
|
1,671,122 |
|
$ |
42.32 |
|
684,998 |
|
$ |
34.76 |
|
|
Awards exercised/vested (1993 plan) (1) |
|
(1,754,288 |
) |
$ |
25.24 |
|
(151,104 |
) |
$ |
23.55 |
|
|
Awards exercised/vested (2002 plan) (1) |
|
(890,326 |
) |
$ |
29.24 |
|
(519,664 |
) |
$ |
21.07 |
|
|
Merger Options exercised (1) |
|
(3,162 |
) |
$ |
19.49 |
|
— |
|
— |
|
|
|
Awards canceled (1993 plan) |
|
(8,866 |
) |
$ |
22.46 |
|
(275 |
) |
$ |
23.55 |
|
|
Awards canceled (2002 plan) |
|
(171,436 |
) |
$ |
35.28 |
|
(81,026 |
) |
$ |
34.74 |
|
|
Balance at December 31, 2006 |
|
9,415,787 |
|
$ |
29.71 |
|
1,302,757 |
|
$ |
34.85 |
|
(1) The aggregate intrinsic value of options exercised during the year ended December 31, 2006 was $58.0 million.
The following table summarizes information regarding options outstanding at December 31, 2006:
|
|
|
Options Outstanding (1) |
|
|
|
|
|
||||||
|
|
|
|
|
Weighted |
|
|
|
Options Exercisable (2) |
|
||||
|
|
|
|
|
Average |
|
Weighted |
|
|
|
Weighted |
|
||
|
Range of Exercise Prices |
|
Options |
|
Remaining
|
|
Average
|
|
Options |
|
Average
|
|
||
|
$9.00 to $18.13 |
|
92 |
|
0.01 |
|
$ |
9.55 |
|
92 |
|
$ |
9.55 |
|
|
$18.14 to $22.67 |
|
837,986 |
|
2.52 |
|
$ |
20.56 |
|
837,986 |
|
$ |
20.56 |
|
|
$22.68 to $27.20 |
|
2,376,911 |
|
3.78 |
|
$ |
24.63 |
|
2,376,911 |
|
$ |
24.63 |
|
|
$27.21 to $31.73 |
|
2,784,929 |
|
5.98 |
|
$ |
28.30 |
|
2,264,236 |
|
$ |
28.06 |
|
|
$31.74 to $36.26 |
|
1,817,740 |
|
8.05 |
|
$ |
31.77 |
|
773,233 |
|
$ |
31.77 |
|
|
$36.27 to $40.80 |
|
329,167 |
|
8.96 |
|
$ |
39.74 |
|
302,967 |
|
$ |
39.90 |
|
|
$40.81 to $45.33 |
|
1,268,962 |
|
9.03 |
|
$ |
42.81 |
|
76,624 |
|
$ |
42.80 |
|
|
$9.00 to $45.33 |
|
9,415,787 |
|
6.03 |
|
$ |
29.71 |
|
6,632,049 |
|
$ |
27.03 |
|
(1) The aggregate intrinsic value of options outstanding as of December 31, 2006 is $198.1 million.
(2) The aggregate intrinsic value and weighted average remaining contractual life in years of options exercisable as of December 31, 2006 is $156.8 million and 5.1 years, respectively.
As of December 31, 2005 and 2004, 6,864,922 Options (with a weighted average exercise price of $25.60) and 6,851,442 Options (with a weighted average exercise price of $24.47) were exercisable, respectively.
F-35
15. Employee Plans
The Company established an Employee Share Purchase Plan (the “ESPP”) to provide employees and trustees the ability to annually acquire up to $100,000 of Common Shares of the Company. In 2003, the Company’s shareholders approved an increase in the aggregate number of Common Shares available under the ESPP to 7,000,000 (from 2,000,000). The Company has 4,270,759 Common Shares available for purchase under the ESPP at December 31, 2006. The Common Shares may be purchased quarterly at a price equal to 85% of the lesser of: (a) the closing price for a share on the last day of such quarter; and (b) the greater of: (i) the closing price for a share on the first day of such quarter, and (ii) the average closing price for a share for all the business days in the quarter. The following table summarizes information regarding the Common Shares issued under the ESPP:
|
|
|
Year Ended December 31, |
|
||||
|
|
|
2006 |
|
2005 |
|
2004 |
|
|
|
|
(Amounts in thousands except share and per share amounts) |
|
||||
|
|
|
|
|
|
|
|
|
|
Shares issued |
|
213,427 |
|
286,751 |
|
275,616 |
|
|
Issuance price ranges |
|
$35.43 – $43.30 |
|
$27.89 – $32.27 |
|
$23.35 – $27.39 |
|
|
Issuance proceeds |
|
$7,972 |
|
$8,285 |
|
$6,853 |
|
The Company established a defined contribution plan (the “401(k) Plan”) to provide retirement benefits for employees that meet minimum employment criteria. The Company matches dollar for dollar up to the first 3% of eligible compensation that a participant contributes to the 401(k) Plan (2% for 2004). Participants are vested in the Company’s contributions over five years. The Company made contributions in the amount of $3.5 million and $1.7 million for the years ended December 31, 2005 and 2004, respectively, and expects to make contributions in the amount of approximately $3.0 million for the year ended December 31, 2006.
The Company may also elect to make an annual discretionary profit-sharing contribution as a percentage of each individual employee’s eligible compensation under the 401(k) Plan. The Company expects to make contributions in the amount of approximately $3.4 million for the year ended December 31, 2006. The Company made contributions of approximately $2.6 million for the year ended December 31, 2005 and did not make a contribution for the year ended December 31, 2004.
The Company established a supplemental executive retirement plan (the “SERP”) to provide certain officers and trustees an opportunity to defer a portion of their eligible compensation in order to save for retirement. The SERP is restricted to investments in Company Common Shares, certain marketable securities that have been specifically approved, and cash equivalents. The deferred compensation liability represented in the SERP and the securities issued to fund such deferred compensation liability are consolidated by the Company and carried on the Company’s balance sheet, and the Company’s Common Shares held in the SERP are accounted for as a reduction to paid in capital.
16. Distribution Reinvestment and Share Purchase Plan
On November 3, 1997, the Company filed with the SEC a Form S-3 Registration Statement to register 14,000,000 Common Shares pursuant to a Distribution Reinvestment and Share Purchase Plan (the “DRIP Plan”). The registration statement was declared effective on November 25, 1997. The Company has 11,571,277 Common Shares available for issuance under the DRIP Plan at December 31, 2006.
The DRIP Plan provides holders of record and beneficial owners of Common Shares and Preferred Shares with a simple and convenient method of investing cash distributions in additional Common Shares (which is referred to herein as the “Dividend Reinvestment – DRIP Plan”). Common Shares may also be purchased on a monthly basis with optional cash payments made by participants in the DRIP Plan and interested new investors, not currently shareholders of the Company, at the market price of the Common
F-36
Shares less a discount ranging between 0% and 5%, as determined in accordance with the DRIP Plan (which is referred to herein as the “Share Purchase – DRIP Plan”). Common Shares purchased under the DRIP Plan may, at the option of the Company, be directly issued by the Company or purchased by the Company’s transfer agent in the open market using participants’ funds.
17. Transactions with Related Parties
The Company provided asset and property management services to certain related entities for properties not owned by the Company. Fees received for providing such services were approximately $0.3 million, $0.2 million and $0.2 million for the years ended December 31, 2006, 2005 and 2004, respectively.
The Company leases its corporate headquarters from an entity controlled by EQR’s Chairman of the Board of Trustees. The lease terminates on July 31, 2011. Amounts incurred for such office space for the years ended December 31, 2006, 2005 and 2004, respectively, were approximately $2.8 million, $2.1 million and $1.9 million. The Company believes these amounts equal market rates for such space.
The Company had the following additional non-continuing related party transactions:
• The Company reimbursed its Chief Operating Officer for the actual operating costs (excluding acquisition costs) of operating his personal aircraft for himself and other employees on Company business in 2005 and 2004. Amounts incurred were approximately $0.4 million and $0.3 million for the years ended December 31, 2005 and 2004, respectively.
• The Company leased space in an office building in Augusta, Georgia indirectly owned by one of EQR’s former trustees since May 2003 and directly owned by an entity affiliated with the same EQR trustee from 1998 to 2003 (individual was a trustee through May 2004). Approximately $0.2 million was incurred for such office space for the year ended December 31, 2004.
18. Commitments and Contingencies
The Company, as an owner of real estate, is subject to various Federal, state and local environmental laws. Compliance by the Company with existing laws has not had a material adverse effect on the Company. However, the Company cannot predict the impact of new or changed laws or regulations on its current properties or on properties that it may acquire in the future.
The Company is party to a housing discrimination lawsuit brought by a non-profit civil rights organization in April 2006 in the U.S. District Court for the District of Maryland. The suit alleges that the Company designed and built approximately 300 of its properties in violation of the accessibility requirements of the Fair Housing Act and Americans With Disabilities Act. The suit seeks actual and punitive damages, injunctive relief (including modification of non-compliant properties), costs and attorneys’ fees. The Company believes it has a number of viable defenses, including that a majority of the named properties were completed before the operative dates of the statutes in question and/or were not designed or built by the Company. Accordingly, the Company is defending the suit vigorously. Due to the pendency of the Company’s defenses and the uncertainty of many other critical factual and legal issues, it is not possible to determine or predict the outcome of the suit and as a result, no amounts have been accrued at December 31, 2006. While no assurances can be given, the Company does not believe that the suit, if adversely determined, would have a material adverse effect on the Company.
The Company does not believe there is any other litigation pending or threatened against it that, individually or in the aggregate, reasonably may be expected to have a material adverse effect on the Company.
During the years ended December 31, 2005 and 2004, the Company established a reserve and recorded a corresponding expense, net of insurance receivables, for estimated uninsured property damage at
F-37
certain of its properties caused by various hurricanes in each respective year. During the year ended December 31, 2006, the Company received $12.1 million in insurance proceeds and recorded an additional $6.2 million of receivables in anticipation of proceeds expected. As of December 31, 2006, a receivable of $5.1 million and a liability of $3.2 million are included in other assets and rents received in advance and other liabilities, respectively, on the consolidated balance sheets.
As of December 31, 2006, the Company has eleven projects totaling 3,448 units in various stages of development with estimated completion dates ranging through June 30, 2009. The primary development agreements currently in place have the following key terms:
• The first development partner has the right, at any time following completion of a project, to stipulate a value for such project and offer to sell its interest in the project to the Company based on such value. If the Company chooses not to purchase the interest, the Company must agree to a sale of the project to an unrelated third party at such value. The Company’s partner must exercise this right as to all projects subject to the agreement within five years after the receipt of the final certificate of occupancy on the last developed property.
• The second development partner has the right, at any time following completion of a project, to require the Company to purchase the partner’s interest in that project at a mutually agreeable price. If the Company and the partner are unable to agree on a price, both parties will obtain appraisals. If the appraised values vary by more than 10%, both the Company and its partner will agree on a third appraiser to determine which original appraisal is closest to its determination of value. The Company may elect at that time not to purchase the property and instead, authorize its partner to sell the project at or above the agreed-upon value to an unrelated third party. Five years following the receipt of the final certificate of occupancy on the last developed property, the Company must purchase, at the agreed-upon price, any projects remaining unsold.
• The third development partner has the exclusive right for six months following stabilization, as defined, to market a subject project for sale. Thereafter, either the Company or its development partner may market a subject project for sale. If the Company’s development partner proposes the sale, the Company may elect to purchase the project at the price proposed by its partner or defer the sale until two independent appraisers appraise the project. If the two appraised values vary by more than 5%, a third appraiser will be chosen to determine the fair market value of the property. Once a value has been determined, the Company may elect to purchase the property or authorize its development partner to sell the project at the agreed-upon value.
In addition, the Company has various deal-specific development agreements with partners, the overall terms of which are similar in nature to those described above.
The Company’s guaranty of a credit enhancement agreement with respect to certain tax-exempt bonds issued to finance certain public improvements at a multifamily development project was terminated effective May 2, 2005 as the tax-exempt bonds were redeemed in full and the associated letter of credit was cancelled.
During the years ended December 31, 2006, 2005 and 2004, total operating lease payments incurred for office space, including a portion of real estate taxes, insurance, repairs and utilities, aggregated $6.7 million, $6.1 million and $5.8 million, respectively.
The Company has entered into a retirement benefits agreement with its Chairman of the Board of Trustees and deferred compensation agreements with its chief operating officer and two former chief executive officers. During the years ended December 31, 2006, 2005 and 2004, the Company recognized compensation expense of $1.1 million, $2.2 million and $39,000, respectively, related to these agreements.
The following table summarizes the Company’s contractual obligations for minimum rent payments
F-38
under operating leases and deferred compensation for the next five years and thereafter as of December 31, 2006:
|
|
|
Payments Due by Year (in thousands) |
|
|||||||||||||||||||
|
|
|
2007 |
|
2008 |
|
2009 |
|
2010 |
|
2011 |
|
Thereafter |
|
Total |
|
|||||||
|
Operating Leases: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Minimum Rent Payments (a) |
|
$ |
5,443 |
|
$ |
5,302 |
|
$ |
4,709 |
|
$ |
4,119 |
|
$ |
2,416 |
|
$ |
2,963 |
|
$ |
24,952 |
|
|
Other Long-Term Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Deferred Compensation (b) |
|
813 |
|
813 |
|
1,450 |
|
1,450 |
|
2,049 |
|
14,736 |
|
21,311 |
|
|||||||
(a) Minimum basic rent due for various office space the Company leases and fixed base rent due on a ground lease for one property.
(b) Estimated payments to the Company’s Chairman, two former CEO’s and its chief operating officer based on planned retirement dates.
19. Impairment
The Company recorded approximately $30.0 million of asset impairment charges related to its write-down of the entire carrying value of the goodwill on its corporate housing business during the year ended December 31, 2006. Following the guidance in SFAS No. 142, this charge was the result of the continued poor operating performance of the corporate housing business and management’s expectations for future performance. This charge is reflected on the consolidated statements of operations as impairment.
The Company also took an impairment charge of $2.0 million related to the write-off of various deferred sales costs following the decision to halt the condominium conversion and sale process at five assets. The remaining $2.0 million of impairment losses in 2006 along with the $0.6 million and $1.5 million of losses in 2005 and 2004, respectively, represent the write-off of various pursuit and out-of-pocket costs for terminated acquisition, disposition and development transactions.
20. Reportable Segments
Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by senior management. Senior management decides how resources are allocated and assesses performance on a monthly basis.
The Company’s primary business is owning, managing, and operating multifamily residential properties, which includes the generation of rental and other related income through the leasing of apartment units to residents. Senior management evaluates the performance of each of our apartment communities individually and geographically, and both on a same store and non-same store basis; however, each of our apartment communities generally has similar economic characteristics, residents, products and services. The Company’s operating segments have been aggregated by geography in a manner identical to that which is provided to its chief operating decision maker.
The Company’s fee and asset management, development (including FIN No. 46 partially owned properties), condominium conversion and corporate housing (Equity Corporate Housing or “ECH”) activities are immaterial and do not individually meet the threshold requirements of a reportable segment as provided for in SFAS No. 131 and as such, have been aggregated in the tables presented below.
All revenues are from external customers and there is no customer who contributed 10% or more of the Company’s total revenues during the three years ended December 31, 2006, 2005, or 2004.
The primary financial measure for the Company’s rental real estate properties is net operating income (“NOI”), which represents rental income less: 1) property and maintenance expense; 2) real estate taxes and insurance expense; and 3) property management expense (all as reflected in the accompanying statements of operations). The Company believes that NOI is helpful to investors as a supplemental measure of the operating performance of a real estate company because it is a direct measure of the actual operating results of the Company’s apartment communities. Current year NOI is compared to prior year NOI and current year budgeted NOI as a measure of financial performance. The following table presents NOI for each segment from our rental real estate specific to continuing operations as well as total assets for the years ended December 31, 2006, and 2005, respectively (amounts in thousands):
F-39
|
|
|
Year Ended December 31, 2006 |
|
|||||||||||||
|
|
|
Northeast |
|
South |
|
West |
|
Other (3) |
|
Total |
|
|||||
|
Rental income: |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Same store (1) |
|
$ |
424,292 |
|
$ |
611,636 |
|
$ |
576,601 |
|
$ |
— |
|
$ |
1,612,529 |
|
|
Non-same store/other (2) (3) |
|
126,535 |
|
79,383 |
|
76,524 |
|
86,364 |
|
368,806 |
|
|||||
|
Total rental income |
|
550,827 |
|
691,019 |
|
653,125 |
|
86,364 |
|
1,981,335 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Same store (1) |
|
164,050 |
|
259,789 |
|
204,371 |
|
— |
|
628,210 |
|
|||||
|
Non-same store/other (2) (3) |
|
49,781 |
|
32,528 |
|
28,869 |
|
83,765 |
|
194,943 |
|
|||||
|
Total operating expenses |
|
213,831 |
|
292,317 |
|
233,240 |
|
83,765 |
|
823,153 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
NOI: |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Same store (1) |
|
260,242 |
|
351,847 |
|
372,230 |
|
— |
|
984,319 |
|
|||||
|
Non-same store/other (2) (3) |
|
76,754 |
|
46,855 |
|
47,655 |
|
2,599 |
|
173,863 |
|
|||||
|
Total NOI |
|
$ |
336,996 |
|
$ |
398,702 |
|
$ |
419,885 |
|
$ |
2,599 |
|
$ |
1,158,182 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Total assets |
|
$ |
4,465,461 |
|
$ |
4,316,252 |
|
$ |
4,507,019 |
|
$ |
1,773,487 |
|
$ |
15,062,219 |
|
(1) Same store includes properties owned for all of both 2006 and 2005 which represented 128,133 units.
(2) Non-same store includes properties acquired after January 1, 2005.
(3) Other includes ECH, development, condominium conversion overhead of $5.9 million and other corporate operations. Also reflects $15.8 million elimination of rental income recorded in Northeast, South and West operating segments related to ECH.
|
|
|
Year Ended December 31, 2005 |
|
|||||||||||||
|
|
|
Northeast |
|
South |
|
West |
|
Other (3) |
|
Total |
|
|||||
|
Rental income: |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Same store (1) |
|
$ |
405,983 |
|
$ |
571,485 |
|
$ |
546,390 |
|
$ |
— |
|
$ |
1,523,858 |
|
|
Non-same store/other (2) (3) |
|
32,478 |
|
21,006 |
|
22,677 |
|
72,399 |
|
148,560 |
|
|||||
|
Total rental income |
|
438,461 |
|
592,491 |
|
569,067 |
|
72,399 |
|
1,672,418 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Same store (1) |
|
157,065 |
|
250,989 |
|
196,264 |
|
— |
|
604,318 |
|
|||||
|
Non-same store/other (2) (3) |
|
13,737 |
|
7,784 |
|
8,868 |
|
95,320 |
|
125,709 |
|
|||||
|
Total operating expenses |
|
170,802 |
|
258,773 |
|
205,132 |
|
95,320 |
|
730,027 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
NOI: |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Same store (1) |
|
248,918 |
|
320,496 |
|
350,126 |
|
— |
|
919,540 |
|
|||||
|
Non-same store/other (2) (3) |
|
18,741 |
|
13,222 |
|
13,809 |
|
(22,921 |
) |
22,851 |
|
|||||
|
Total NOI |
|
$ |
267,659 |
|
$ |
333,718 |
|
$ |
363,935 |
|
$ |
(22,921 |
) |
$ |
942,391 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Total assets |
|
$ |
4,056,535 |
|
$ |
3,829,466 |
|
$ |
3,977,377 |
|
$ |
2,245,373 |
|
$ |
14,108,751 |
|
(1) Same store includes properties owned for all of both 2006 and 2005 which represented 128,133 units.
(2) Non-same store includes properties acquired after January 1, 2005.
(3) Other includes ECH, development, condominium conversion overhead of $3.1 million and other corporate operations. Also reflects $13.4 million elimination of rental income recorded in Northeast, South and West operating segments related to ECH and $11.1 million of hurricane insurance losses.
Note: Markets included in the above geographic segments are as follows:
(a) Northeast – New England (excl Boston), Boston, New York Metro, DC Northern Virginia, Suburban Maryland, Chicago, Milwaukee and Minneapolis/St. Paul.
(b) South – Charlotte, Raleigh/Durham, Atlanta, Jacksonville, Orlando, Tampa/Ft. Myers, South Florida, Nashville, Tulsa, Austin, Houston, Dallas/Ft. Worth, Albuquerque and Phoenix.
(c) West – Seattle/Tacoma, Portland, Central Valley, San Francisco Bay Area, Inland Empire, Los Angeles, Orange County, San Diego and Denver.
The following table presents a reconciliation of NOI from our rental real estate specific to continuing operations for the years ended December 31, 2006, 2005 and 2004, respectively:
|
|
|
Year Ended December 31, |
|
|||||||
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
|
|
(Amounts in thousands) |
|
|||||||
|
|
|
|
|
|
|
|
|
|||
|
Rental income |
|
$ |
1,981,335 |
|
$ |
1,672,418 |
|
$ |
1,483,184 |
|
|
Property and maintenance expense |
|
(527,154 |
) |
(451,245 |
) |
(392,295 |
) |
|||
|
Real estate taxes and insurance expense |
|
(199,582 |
) |
(191,679 |
) |
(175,605 |
) |
|||
|
Property management expense |
|
(96,417 |
) |
(87,103 |
) |
(76,898 |
) |
|||
|
Total operating expenses |
|
(823,153 |
) |
(730,027 |
) |
(644,798 |
) |
|||
|
Net operating income |
|
$ |
1,158,182 |
|
$ |
942,391 |
|
$ |
838,386 |
|
21. Subsequent Events/Other
Subsequent to December 31, 2006 and through February 7, 2007, the Company:
• Acquired $536.5 million of apartment properties consisting of nine properties and 2,905 units;
• Sold one residential property consisting of 280 units for $14.4 million (excluding condominium units); and
• Repaid $115.3 million of mortgage loans.
During the years ended December 31, 2006 and 2005, the Company received proceeds from technology and other investments of $4.0 million and $82.1 million, respectively, from the following:
• $25.0 million in full redemption of 1,000,000 shares of Wellsford 8.25% Convertible Trust Preferred Securities during 2005;
• $3.7 million and $57.1 million for its ownership interest in Rent.com in connection with the acquisition of Rent.com by eBay, Inc in 2006 and 2005, respectively. Both amounts were recorded as interest and other income in the accompanying consolidated statements of operations; and
• $0.3 million as a partial distribution for its ownership interest in Constellation Real Technologies, LLC in 2006. The amount was recorded as interest and other income.
During 2006, the Company recognized $14.7 million of forfeited deposits for various terminated transactions, included in interest and other income.
During the fourth quarter of 2006, the Company established a reserve of $6.2 million related to potential liabilities associated with certain asset sales. While no assurances can be given, the Company does not believe that the potential issue, if adversely determined or settled, will have a material adverse effect on the Company.
On March 28, 2005, the Company and Bruce W. Duncan, the Company’s former Chief Executive Officer (“CEO”), entered into an Amended and Restated Employment Agreement (as further amended effective June 30, 2005, the “Amendment”) to reflect changes required in view of Mr. Duncan’s retirement as CEO and trustee effective December 31, 2005. The Amendment also amended Mr. Duncan’s Deferred Compensation Agreement entered into in January 2003. The Company recorded approximately $11.2 million of additional general and administrative expense during the year ended
F-40
December 31, 2005, primarily related to accelerated vesting of share options and restricted/performance shares.
Effective February 28, 2005, the Company and Edward Geraghty, the President of the Company’s Eastern Division, entered into a Separation Agreement and General Release reflecting Mr. Geraghty’s resignation effective February 28, 2005. The Company recorded approximately $3.3 million of severance as additional general and administrative expense during the quarter ended March 31, 2005.
22. Quarterly Financial Data (Unaudited)
The following unaudited quarterly data has been prepared on the basis of a December 31 year-end. All amounts have also been restated in accordance with the discontinued operations provisions of SFAS No 144 and reflect dispositions and/or properties held for sale through December 31, 2006. Amounts are in thousands, except for per share amounts.
|
2006 |
|
Fourth
|
|
Third
|
|
Second
|
|
First
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total revenues (1) |
|
$ |
517,880 |
|
$ |
511,464 |
|
$ |
490,614 |
|
$ |
470,478 |
|
|
Operating income (1) |
|
104,731 |
|
139,726 |
|
140,463 |
|
128,223 |
|
||||
|
Income from continuing operations, net of minority interests (1) |
|
11,961 |
|
35,440 |
|
34,016 |
|
19,115 |
|
||||
|
Discontinued operations, net of minority interests (1) |
|
453,100 |
|
34,371 |
|
126,141 |
|
358,700 |
|
||||
|
Net income * |
|
465,061 |
|
69,811 |
|
160,157 |
|
377,815 |
|
||||
|
Net income available to Common Shares |
|
457,606 |
|
56,356 |
|
150,084 |
|
367,720 |
|
||||
|
Earnings per share – basic: |
|
|
|
|
|
|
|
|
|
||||
|
Net income available to Common Shares |
|
$ |
1.57 |
|
$ |
0.19 |
|
$ |
0.52 |
|
$ |
1.27 |
|
|
Weighted average Common Shares outstanding |
|
291,669 |
|
290,036 |
|
289,460 |
|
288,880 |
|
||||
|
Earnings per share – diluted: |
|
|
|
|
|
|
|
|
|
||||
|
Net income available to Common Shares |
|
$ |
1.54 |
|
$ |
0.19 |
|
$ |
0.51 |
|
$ |
1.25 |
|
|
Weighted average Common Shares outstanding |
|
317,076 |
|
315,886 |
|
314,698 |
|
314,049 |
|
||||
(1) The amounts presented for the first three quarters of 2006 are not equal to the same amounts previously reported in the respective Form 10-Q’s filed with the SEC for each period as a result of changes in discontinued operations due to additional property sales which occurred throughout 2006. Below is a reconciliation to the amounts previously reported in the respective Form 10-Q’s:
F-41
|
2006 |
|
Third
|
|
Second
|
|
First
|
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Total revenues previously reported in Form 10-Q |
|
$ |
513,865 |
|
$ |
491,939 |
|
$ |
520,979 |
|
|
Total revenues subsequently reclassified to discontinued operations |
|
(2,401 |
) |
(1,325 |
) |
(50,501 |
) |
|||
|
Total revenues disclosed in Form 10-K |
|
$ |
511,464 |
|
$ |
490,614 |
|
$ |
470,478 |
|
|
|
|
|
|
|
|
|
|
|||
|
Operating income previously reported in Form 10-Q |
|
$ |
140,784 |
|
$ |
140,321 |
|
$ |
142,019 |
|
|
Operating income subsequently reclassified to discontinued operations |
|
(1,058 |
) |
142 |
|
(13,796 |
) |
|||
|
Operating income disclosed in Form 10-K |
|
$ |
139,726 |
|
$ |
140,463 |
|
$ |
128,223 |
|
|
|
|
|
|
|
|
|
|
|||
|
Income from continuing operations, net of minority interests previously reported in Form 10-Q |
|
$ |
36,426 |
|
$ |
33,883 |
|
$ |
26,869 |
|
|
Income from continuing operations, net of minority interests subsequently reclassified to discontinued operations |
|
(986 |
) |
133 |
|
(7,754 |
) |
|||
|
Income from continuing operations, net of minority interests disclosed in Form 10-K |
|
$ |
35,440 |
|
$ |
34,016 |
|
$ |
19,115 |
|
|
|
|
|
|
|
|
|
|
|||
|
Discontinued operations, net of minority interests previously reported in Form 10-Q |
|
$ |
33,385 |
|
$ |
126,274 |
|
$ |
350,946 |
|
|
Discontinued operations, net of minority interests from properties sold subsequent to the respective reporting period |
|
986 |
|
(133 |
) |
7,754 |
|
|||
|
Discontinued operations, net of minority interests disclosed in Form 10-K |
|
$ |
34,371 |
|
$ |
126,141 |
|
$ |
358,700 |
|
|
2005 |
|
Fourth
|
|
Third
|
|
Second
|
|
First
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total revenues (2) |
|
$ |
449,541 |
|
$ |
426,771 |
|
$ |
411,278 |
|
$ |
395,068 |
|
|
Operating income (2) |
|
106,461 |
|
108,196 |
|
115,151 |
|
103,656 |
|
||||
|
Income from continuing operations, net of minority interests (2) |
|
30,554 |
|
14,343 |
|
23,678 |
|
78,748 |
|
||||
|
Discontinued operations, net of minority interests (2) |
|
195,332 |
|
253,181 |
|
117,666 |
|
148,291 |
|
||||
|
Net income * |
|
225,886 |
|
267,524 |
|
141,344 |
|
227,039 |
|
||||
|
Net income available to Common Shares |
|
215,205 |
|
250,247 |
|
128,326 |
|
214,014 |
|
||||
|
Earnings per share – basic: |
|
|
|
|
|
|
|
|
|
||||
|
Net income available to Common Shares |
|
$ |
0.75 |
|
$ |
0.87 |
|
$ |
0.45 |
|
$ |
0.75 |
|
|
Weighted average Common Shares outstanding |
|
287,033 |
|
286,182 |
|
285,283 |
|
284,511 |
|
||||
|
Earnings per share – diluted: |
|
|
|
|
|
|
|
|
|
||||
|
Net income available to Common Shares |
|
$ |
0.74 |
|
$ |
0.87 |
|
$ |
0.44 |
|
$ |
0.74 |
|
|
Weighted average Common Shares outstanding |
|
312,048 |
|
286,182 |
|
309,979 |
|
308,576 |
|
||||
(2) The amounts presented for the four quarters of 2005 are not equal to the same amounts previously reported in the Form 8-K filed with the SEC on August 15, 2006 for each period as a result of changes in discontinued operations due to additional property sales which occurred throughout 2006. Below is a reconciliation to the amounts previously reported:
F-42
|
2005 |
|
Fourth
|
|
Third
|
|
Second
|
|
First
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total revenues previously reported in August 2006 Form 8-K |
|
$ |
452,858 |
|
$ |
430,758 |
|
$ |
415,230 |
|
$ |
399,054 |
|
|
Total revenues subsequently reclassified to discontinued operations |
|
(3,317 |
) |
(3,987 |
) |
(3,952 |
) |
(3,986 |
) |
||||
|
Total revenues disclosed in Form 10-K |
|
$ |
449,541 |
|
$ |
426,771 |
|
$ |
411,278 |
|
$ |
395,068 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Operating income previously reported in August 2006 Form 8-K |
|
$ |
107,051 |
|
$ |
109,077 |
|
$ |
116,263 |
|
$ |
104,818 |
|
|
Operating income subsequently reclassified to discontinued operations |
|
(590 |
) |
(881 |
) |
(1,112 |
) |
(1,162 |
) |
||||
|
Operating income disclosed in Form 10-K |
|
$ |
106,461 |
|
$ |
108,196 |
|
$ |
115,151 |
|
$ |
103,656 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Income from continuing operations, net of minority interests previously reported in August 2006 Form 8-K |
|
$ |
30,777 |
|
$ |
14,833 |
|
$ |
24,379 |
|
$ |
79,502 |
|
|
Income from continuing operations, net of minority interests subsequently reclassified to discontinued operations |
|
(223 |
) |
(490 |
) |
(701 |
) |
(754 |
) |
||||
|
Income from continuing operations, net of minority interests disclosed in Form 10-K |
|
$ |
30,554 |
|
$ |
14,343 |
|
$ |
23,678 |
|
$ |
78,748 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Discontinued operations, net of minority interests previously reported in August 2006 Form 8-K |
|
$ |
195,109 |
|
$ |
252,691 |
|
$ |
116,965 |
|
$ |
147,537 |
|
|
Discontinued operations, net of minority interests from properties sold subsequent to the respective reporting period |
|
223 |
|
490 |
|
701 |
|
754 |
|
||||
|
Discontinued operations, net of minority interests disclosed in Form 10-K |
|
$ |
195,332 |
|
$ |
253,181 |
|
$ |
117,666 |
|
$ |
148,291 |
|
* The Company did not have any extraordinary items or cumulative effect of change in accounting principle during the years ended December 31, 2006 and 2005. Therefore, income before extraordinary items and cumulative effect of change in accounting principle is not shown as it was equal to the net income amounts disclosed above.
F-43
EQUITY RESIDENTIAL
Schedule III - Real Estate and Accumulated Depreciation
Overall Summary
December 31, 2006
|
|
|
Properties
|
|
Units (I) |
|
Investment in Real
|
|
Accumulated
|
|
Investment in Real
|
|
Encumbrances |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Wholly Owned Unencumbered |
|
438 |
|
97,902 |
|
$ |
11,453,690,644 |
|
$ |
(2,006,699,313 |
) |
$ |
9,446,991,331 |
|
$ |
— |
|
|
Wholly Owned Encumbered |
|
108 |
|
48,540 |
|
5,221,601,153 |
|
(936,392,757 |
) |
4,285,208,396 |
|
1,923,428,819 |
|
||||
|
Portfolio/Entity Encumbrances (1) |
|
— |
|
— |
|
— |
|
— |
|
— |
|
893,451,149 |
|
||||
|
Wholly Owned Properties |
|
546 |
|
146,442 |
|
16,675,291,797 |
|
(2,943,092,070 |
) |
13,732,199,727 |
|
2,816,879,968 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Partially Owned Unencumbered |
|
2 |
|
483 |
|
99,157,051 |
|
(7,660,504 |
) |
91,496,547 |
|
— |
|
||||
|
Partially Owned Encumbered |
|
23 |
|
4,390 |
|
460,726,265 |
|
(71,727,221 |
) |
388,999,044 |
|
361,343,204 |
|
||||
|
Partially Owned Properties |
|
25 |
|
4,873 |
|
559,883,316 |
|
(79,387,725 |
) |
480,495,591 |
|
361,343,204 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total Unencumbered Properties |
|
440 |
|
98,385 |
|
11,552,847,695 |
|
(2,014,359,817 |
) |
9,538,487,878 |
|
— |
|
||||
|
Total Encumbered Properties |
|
131 |
|
52,930 |
|
5,682,327,418 |
|
(1,008,119,978 |
) |
4,674,207,440 |
|
3,178,223,172 |
|
||||
|
Total Consolidated Investment in Real Estate |
|
571 |
|
151,315 |
|
$ |
17,235,175,113 |
|
$ |
(3,022,479,795 |
) |
$ |
14,212,695,318 |
|
$ |
3,178,223,172 |
|
(I) See attached Encumbrances Reconciliation.
S-1
EQUITY RESIDENTIAL
Schedule III - Real Estate and Accumulated Depreciation
Encumbrances Reconciliation
December 31, 2006
|
Portfolio/Entity Encumbrances |
|
Number of
|
|
See Properties
|
|
Amount |
|
|
|
|
|
|
|
|
|
|
|
|
|
EQR Arbors Financing LP |
|
1 |
|
(K) |
|
$ |
13,265,000 |
|
|
EQR-Bond Partnership |
|
10 |
|
(L) |
|
144,514,000 |
|
|
|
GPT-Windsor, LLC |
|
16* |
|
(M) |
|
63,000,000 |
|
|
|
EQR-Codelle, LP |
|
10 |
|
(N) |
|
114,553,427 |
|
|
|
EQR-Conner, LP |
|
14 |
|
(O) |
|
198,301,191 |
|
|
|
EQR-FANCAP 2000A LP |
|
11 |
|
(P) |
|
148,333,000 |
|
|
|
EQR-Fankey 2004 Ltd. Pship |
|
8 |
|
(Q) |
|
211,484,531 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Portfolio/Entity Encumbrances |
|
|
|
|
|
893,451,149 |
|
|
|
Individual Property Encumbrances |
|
|
|
|
|
2,284,772,023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Encumbrances per Financial Statements |
|
|
|
|
|
$ |
3,178,223,172 |
|
* Collateral also includes $2.7 million invested in U.S. Treasury Securities which is included in Deposits - Restricted in the accompanying consolidated balance sheets at December 31, 2006.
S-2
ERP OPERATING LIMITED PARTNERSHIP
Schedule III - Real Estate and Accumulated Depreciation
(Amounts in thousands)
The changes in total real estate for the years ended December 31, 2006, 2005 and 2004 are as follows:
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Balance, beginning of year |
|
$ |
16,590,370 |
|
$ |
14,852,621 |
|
$ |
12,874,379 |
|
|
Acquisitions and development |
|
2,252,039 |
|
2,906,414 |
|
2,563,612 |
|
|||
|
Improvements |
|
265,832 |
|
250,110 |
|
218,724 |
|
|||
|
Dispositions and other |
|
(1,873,066 |
) |
(1,418,775 |
) |
(804,094 |
) |
|||
|
Balance, end of year |
|
$ |
17,235,175 |
|
$ |
16,590,370 |
|
$ |
14,852,621 |
|
The changes in accumulated depreciation for the years ended December 31, 2006, 2005, and 2004 are as follows:
|
|
|
2006 |
|
2005 |
|
2004 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Balance, beginning of year |
|
$ |
2,888,140 |
|
$ |
2,599,827 |
|
$ |
2,296,013 |
|
|
Depreciation |
|
592,637 |
|
528,152 |
|
496,422 |
|
|||
|
Dispositions and other |
|
(458,297 |
) |
(239,839 |
) |
(192,608 |
) |
|||
|
Balance, end of year |
|
$ |
3,022,480 |
|
$ |
2,888,140 |
|
$ |
2,599,827 |
|
S-3
EQUITY RESIDENTIAL
Schedule III - Real Estate and Accumulated Depreciation
December 31, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost Capitalized |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsequent to |
|
|
|
Gross Amount Carried |
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
Initial Cost to |
|
|
|
Acquisition |
|
|
|
at Close of |
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Description |
|
|
|
|
|
Company |
|
|
|
(Improvements, net) (E) |
|
|
|
Period 12/31/06 |
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
|
|
|
|
Date of |
|
|
|
|
|
Building & |
|
|
|
Building & |
|
|
|
Building & |
|
|
|
Accumulated |
|
Investment in Real |
|
|
|
|||||||||
|
Apartment Name |
|
Location |
|
Construction |
|
Units (I) |
|
Land |
|
Fixtures |
|
Land |
|
Fixtures |
|
Land |
|
Fixtures (A) |
|
Total (B) |
|
Depreciation (C) |
|
Estate, Net at 12/31/06 |
|
Encumbrances |
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
EQR Wholly Owned Unencumbered: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
107 Lawrence |
|
Brooklyn, NY |
|
(F) |
|
— |
|
27,605,161 |
|
$ |
210,067 |
|
$ |
— |
|
$ |
— |
|
$ |
27,605,161 |
|
$ |
210,067 |
|
$ |
27,815,228 |
|
$ |
— |
|
$ |
27,815,228 |
|
$ |
— |
|
|
2300 Elliott |
|
Seattle, WA |
|
1992 |
|
92 |
|
796,800 |
|
7,173,725 |
|
— |
|
4,498,851 |
|
796,800 |
|
11,672,576 |
|
12,469,376 |
|
(5,768,648 |
) |
6,700,728 |
|
— |
|
|||||||||
|
303 Third Street - Residential |
|
Cambridge, MA |
|
(F) |
|
— |
|
27,812,384 |
|
28,065,881 |
|
— |
|
— |
|
27,812,384 |
|
28,065,881 |
|
55,878,265 |
|
— |
|
55,878,265 |
|
— |
|
|||||||||
|
500 Elliott, LLC |
|
Seattle, WA (G) |
|
2001 |
|
8 |
|
966,158 |
|
1,625,708 |
|
— |
|
(298,337 |
) |
966,158 |
|
1,327,370 |
|
2,293,528 |
|
— |
|
2,293,528 |
|
— |
|
|||||||||
|
71 Broadway |
|
New York, NY (G) |
|
1997 |
|
238 |
|
22,611,600 |
|
77,491,686 |
|
— |
|
324,536 |
|
22,611,600 |
|
77,816,223 |
|
100,427,823 |
|
(6,728,503 |
) |
93,699,319 |
|
— |
|
|||||||||
|
77 Hudson |
|
Jersey City, NJ |
|
(F) |
|
— |
|
28,170,659 |
|
15,650,251 |
|
— |
|
— |
|
28,170,659 |
|
15,650,251 |
|
43,820,910 |
|
— |
|
43,820,910 |
|
— |
|
|||||||||
|
420 East 80th Street |
|
New York, NY |
|
1961 |
|
155 |
|
39,277,000 |
|
22,976,681 |
|
— |
|
(678 |
) |
39,277,000 |
|
22,976,003 |
|
62,253,003 |
|
(322,377 |
) |
61,930,626 |
|
— |
|
|||||||||
|
600 Washington |
|
New York, NY (G) |
|
2004 |
|
135 |
|
32,852,000 |
|
43,140,551 |
|
— |
|
2,030 |
|
32,852,000 |
|
43,142,581 |
|
75,994,581 |
|
(2,633,563 |
) |
73,361,019 |
|
— |
|
|||||||||
|
Abington Glen |
|
Abington, MA |
|
1968 |
|
90 |
|
553,105 |
|
3,697,396 |
|
— |
|
1,939,825 |
|
553,105 |
|
5,637,221 |
|
6,190,327 |
|
(1,323,816 |
) |
4,866,511 |
|
— |
|
|||||||||
|
Acacia Creek |
|
Scottsdale, AZ |
|
1988-1994 |
|
304 |
|
3,663,473 |
|
21,172,386 |
|
— |
|
1,910,460 |
|
3,663,473 |
|
23,082,847 |
|
26,746,320 |
|
(7,582,253 |
) |
19,164,067 |
|
— |
|
|||||||||
|
Alborada |
|
Fremont, CA |
|
1999 |
|
442 |
|
24,310,000 |
|
59,214,129 |
|
— |
|
1,539,697 |
|
24,310,000 |
|
60,753,826 |
|
85,063,826 |
|
(14,438,092 |
) |
70,625,734 |
|
— |
|
|||||||||
|
Alexander on Ponce |
|
Atlanta, GA |
|
2003 |
|
330 |
|
9,900,000 |
|
35,819,022 |
|
— |
|
401,189 |
|
9,900,000 |
|
36,220,211 |
|
46,120,211 |
|
(2,282,467 |
) |
43,837,744 |
|
— |
|
|||||||||
|
Alexandria at Lake Buena Vista |
|
Orlando, FL |
|
2000 |
|
336 |
|
11,760,000 |
|
40,542,177 |
|
— |
|
1,045,771 |
|
11,760,000 |
|
41,587,948 |
|
53,347,948 |
|
(2,390,411 |
) |
50,957,537 |
|
— |
|
|||||||||
|
Arbors of Brentwood |
|
Nashville, TN |
|
1986 |
|
346 |
|
404,670 |
|
13,535,919 |
|
— |
|
4,185,885 |
|
404,670 |
|
17,721,804 |
|
18,126,474 |
|
(8,395,734 |
) |
9,730,740 |
|
— |
|
|||||||||
|
Ashley Park at Brier Creek |
|
Raleigh, NC |
|
2002 |
|
374 |
|
5,610,000 |
|
31,467,489 |
|
— |
|
1,635,301 |
|
5,610,000 |
|
33,102,790 |
|
38,712,790 |
|
(2,789,282 |
) |
35,923,509 |
|
— |
|
|||||||||
|
Ashton, The |
|
Corona Hills, CA |
|
1986 |
|
492 |
|
2,594,264 |
|
33,042,398 |
|
— |
|
3,935,511 |
|
2,594,264 |
|
36,977,909 |
|
39,572,173 |
|
(12,206,098 |
) |
27,366,075 |
|
— |
|
|||||||||
|
Aspen Crossing |
|
Silver Spring, MD |
|
1979 |
|
192 |
|
2,880,000 |
|
8,551,377 |
|
— |
|
2,586,168 |
|
2,880,000 |
|
11,137,546 |
|
14,017,546 |
|
(3,534,475 |
) |
10,483,071 |
|
— |
|
|||||||||
|
Audubon Village |
|
Tampa, FL |
|
1990 |
|
447 |
|
3,576,000 |
|
26,121,909 |
|
— |
|
2,029,250 |
|
3,576,000 |
|
28,151,159 |
|
31,727,159 |
|
(8,490,754 |
) |
23,236,405 |
|
— |
|
|||||||||
|
Auvers Village |
|
Orlando, FL |
|
1991 |
|
480 |
|
3,840,000 |
|
29,322,243 |
|
— |
|
2,602,927 |
|
3,840,000 |
|
31,925,170 |
|
35,765,170 |
|
(9,903,937 |
) |
25,861,234 |
|
— |
|
|||||||||
|
Avenue Royale |
|
Jacksonville, FL |
|
2001 |
|
200 |
|
5,000,000 |
|
17,785,388 |
|
— |
|
391,054 |
|
5,000,000 |
|
18,176,442 |
|
23,176,442 |
|
(1,476,970 |
) |
21,699,472 |
|
— |
|
|||||||||
|
Azure Creek at Tatum Ranch |
|
Phoenix, AZ |
|
2001 |
|
160 |
|
8,778,000 |
|
17,840,790 |
|
— |
|
409,690 |
|
8,778,000 |
|
18,250,480 |
|
27,028,480 |
|
(714,342 |
) |
26,314,139 |
|
— |
|
|||||||||
|
Balcones Club |
|
Austin, TX |
|
1984 |
|
312 |
|
2,185,500 |
|
10,119,232 |
|
— |
|
2,799,645 |
|
2,185,500 |
|
12,918,877 |
|
15,104,377 |
|
(4,782,660 |
) |
10,321,717 |
|
— |
|
|||||||||
|
Barrington Place |
|
Oviedo, FL |
|
1998 |
|
233 |
|
6,990,000 |
|
15,740,374 |
|
— |
|
126,688 |
|
6,990,000 |
|
15,867,062 |
|
22,857,062 |
|
(700,171 |
) |
22,156,890 |
|
— |
|
|||||||||
|
Bay Ridge |
|
San Pedro, CA |
|
1987 |
|
60 |
|
2,401,300 |
|
2,176,963 |
|
— |
|
583,314 |
|
2,401,300 |
|
2,760,277 |
|
5,161,577 |
|
(1,053,383 |
) |
4,108,194 |
|
— |
|
|||||||||
|
Bayside at the Islands |
|
Gilbert, AZ |
|
1989 |
|
272 |
|
3,306,484 |
|
15,573,006 |
|
— |
|
2,050,029 |
|
3,306,484 |
|
17,623,035 |
|
20,929,519 |
|
(6,016,204 |
) |
14,913,315 |
|
— |
|
|||||||||
|
Bell Road I & II |
|
Nashville, TN |
|
(F) |
|
— |
|
3,100,000 |
|
1,120,214 |
|
— |
|
— |
|
3,100,000 |
|
1,120,214 |
|
4,220,214 |
|
— |
|
4,220,214 |
|
— |
|
|||||||||
|
Bella Vista I & II |
|
Los Angeles, CA |
|
2003 |
|
315 |
|
16,883,410 |
|
61,671,977 |
|
— |
|
529,479 |
|
16,883,410 |
|
62,201,456 |
|
79,084,866 |
|
(6,719,808 |
) |
72,365,058 |
|
— |
|
|||||||||
|
Bella Vista III |
|
Los Angeles, CA |
|
(F) |
|
— |
|
14,799,344 |
|
44,882,173 |
|
— |
|
— |
|
14,799,344 |
|
44,882,173 |
|
59,681,518 |
|
— |
|
59,681,518 |
|
— |
|
|||||||||
|
Bella Vista |
|
Phoenix, AZ |
|
1995 |
|
248 |
|
2,978,879 |
|
20,641,333 |
|
— |
|
2,769,148 |
|
2,978,879 |
|
23,410,482 |
|
26,389,361 |
|
(7,013,886 |
) |
19,375,474 |
|
— |
|
|||||||||
|
Bellagio Apartment Homes |
|
Scottsdale, AZ |
|
1995 |
|
202 |
|
2,626,000 |
|
16,025,041 |
|
— |
|
552,328 |
|
2,626,000 |
|
16,577,369 |
|
19,203,369 |
|
(1,690,463 |
) |
17,512,906 |
|
— |
|
|||||||||
|
Belle Arts Condominium Homes, LLC |
|
Bellevue, WA |
|
2000 |
|
128 |
|
5,678,370 |
|
24,655,908 |
|
— |
|
46,857 |
|
5,678,370 |
|
24,702,764 |
|
30,381,134 |
|
— |
|
30,381,134 |
|
— |
|
|||||||||
|
Bellevue Meadows |
|
Bellevue, WA |
|
1983 |
|
180 |
|
4,507,100 |
|
12,574,814 |
|
— |
|
2,338,278 |
|
4,507,100 |
|
14,913,093 |
|
19,420,193 |
|
(4,212,491 |
) |
15,207,702 |
|
— |
|
|||||||||
|
Beneva Place |
|
Sarasota, FL |
|
1986 |
|
192 |
|
1,344,000 |
|
9,665,447 |
|
— |
|
1,211,761 |
|
1,344,000 |
|
10,877,208 |
|
12,221,208 |
|
(3,313,743 |
) |
8,907,465 |
|
— |
|
|||||||||
|
Bermuda Cove |
|
Jacksonville, FL |
|
1989 |
|
350 |
|
1,503,000 |
|
19,561,896 |
|
— |
|
3,594,399 |
|
1,503,000 |
|
23,156,295 |
|
24,659,295 |
|
(6,975,137 |
) |
17,684,158 |
|
— |
|
|||||||||
|
Bishop Park |
|
Winter Park, FL |
|
1991 |
|
324 |
|
2,592,000 |
|
17,990,436 |
|
— |
|
2,759,444 |
|
2,592,000 |
|
20,749,880 |
|
23,341,880 |
|
(6,771,015 |
) |
16,570,865 |
|
— |
|
|||||||||
|
Braewood, LLC |
|
Bothell, WA |
|
1999/2000 |
|
2 |
|
57,582 |
|
239,610 |
|
— |
|
29,813 |
|
57,582 |
|
269,423 |
|
327,005 |
|
— |
|
327,005 |
|
— |
|
|||||||||
|
Bramblewood |
|
San Jose, CA |
|
1986 |
|
108 |
|
5,190,700 |
|
9,659,184 |
|
— |
|
653,840 |
|
5,190,700 |
|
10,313,025 |
|
15,503,725 |
|
(3,180,360 |
) |
12,323,364 |
|
— |
|
|||||||||
|
Brentwood |
|
Vancouver, WA |
|
1990 |
|
296 |
|
1,357,221 |
|
12,202,521 |
|
— |
|
2,062,577 |
|
1,357,221 |
|
14,265,098 |
|
15,622,320 |
|
(6,293,490 |
) |
9,328,830 |
|
— |
|
|||||||||
|
Breton Mill |
|
Houston, TX |
|
1986 |
|
392 |
|
212,820 |
|
8,547,263 |
|
— |
|
1,990,798 |
|
212,820 |
|
10,538,061 |
|
10,750,881 |
|
(5,241,611 |
) |
5,509,270 |
|
— |
|
|||||||||
|
Bridford Lakes II |
|
Greensboro, NC |
|
(F) |
|
— |
|
1,100,564 |
|
792,509 |
|
— |
|
— |
|
1,100,564 |
|
792,509 |
|
1,893,073 |
|
— |
|
1,893,073 |
|
— |
|
|||||||||
|
Bridgeport |
|
Raleigh, NC |
|
1990 |
|
276 |
|
1,296,700 |
|
11,666,278 |
|
— |
|
1,541,285 |
|
1,296,700 |
|
13,207,564 |
|
14,504,264 |
|
(6,427,922 |
) |
8,076,341 |
|
— |
|
|||||||||
|
Bridgewater at Wells Crossing |
|
Orange Park, FL |
|
1986 |
|
288 |
|
2,160,000 |
|
13,347,549 |
|
— |
|
1,221,537 |
|
2,160,000 |
|
14,569,086 |
|
16,729,086 |
|
(4,041,899 |
) |
12,687,186 |
|
— |
|
|||||||||
|
Broadway |
|
Garland, TX |
|
1983 |
|
288 |
|
1,443,700 |
|
7,790,989 |
|
— |
|
2,100,689 |
|
1,443,700 |
|
9,891,678 |
|
11,335,378 |
|
(3,722,784 |
) |
7,612,594 |
|
— |
|
|||||||||
|
Brookside (CO) |
|
Boulder, CO |
|
1993 |
|
144 |
|
3,600,400 |
|
10,211,159 |
|
— |
|
619,154 |
|
3,600,400 |
|
10,830,313 |
|
14,430,713 |
|
(3,356,877 |
) |
11,073,836 |
|
— |
|
|||||||||
|
Brookside II (MD) |
|
Frederick, MD |
|
1979 |
|
204 |
|
2,450,800 |
|
6,913,202 |
|
— |
|
1,955,989 |
|
2,450,800 |
|
8,869,191 |
|
11,319,991 |
|
(3,086,573 |
) |
8,233,419 |
|
— |
|
|||||||||
|
Cambridge at Hickory Hollow |
|
Antioch, TN |
|
1997 |
|
360 |
|
3,240,800 |
|
17,900,033 |
|
— |
|
1,342,665 |
|
3,240,800 |
|
19,242,698 |
|
22,483,498 |
|
(6,648,883 |
) |
15,834,615 |
|
— |
|
|||||||||
|
Cambridge Estates |
|
Norwich, CT |
|
1977 |
|
92 |
|
590,185 |
|
3,945,265 |
|
— |
|
404,392 |
|
590,185 |
|
4,349,657 |
|
4,939,842 |
|
(1,046,975 |
) |
3,892,867 |
|
— |
|
|||||||||
|
Camellero |
|
Scottsdale, AZ |
|
1979 |
|
348 |
|
1,924,900 |
|
17,324,593 |
|
— |
|
4,779,600 |
|
1,924,900 |
|
22,104,193 |
|
24,029,093 |
|
(10,449,088 |
) |
13,580,005 |
|
— |
|
|||||||||
|
Canyon Crest |
|
Santa Clarita, CA |
|
1993 |
|
158 |
|
2,370,000 |
|
10,141,878 |
|
— |
|
1,606,610 |
|
2,370,000 |
|
11,748,489 |
|
14,118,489 |
|
(3,332,190 |
) |
10,786,298 |
|
— |
|
|||||||||
|
Canyon Ridge |
|
San Diego, CA |
|
1989 |
|
162 |
|
4,869,448 |
|
11,955,064 |
|
— |
|
1,172,039 |
|
4,869,448 |
|
13,127,103 |
|
17,996,551 |
|
(4,336,837 |
) |
13,659,713 |
|
— |
|
|||||||||
|
Carlyle Mill |
|
Alexandria, VA |
|
2002 |
|
317 |
|
10,000,000 |
|
51,368,058 |
|
— |
|
2,810,598 |
|
10,000,000 |
|
54,178,657 |
|
64,178,657 |
|
(6,908,594 |
) |
57,270,062 |
|
— |
|
|||||||||
|
Carmel Terrace |
|
San Diego, CA |
|
1988-89 |
|
384 |
|
2,288,300 |
|
20,596,281 |
|
— |
|
5,595,116 |
|
2,288,300 |
|
26,191,397 |
|
28,479,697 |
|
(10,034,342 |
) |
18,445,355 |
|
— |
|
|||||||||
|
Casa Capricorn |
|
San Diego, CA |
|
1981 |
|
192 |
|
1,262,700 |
|
11,365,093 |
|
— |
|
2,471,705 |
|
1,262,700 |
|
13,836,799 |
|
15,099,499 |
|
(5,213,614 |
) |
9,885,885 |
|
— |
|
|||||||||
|
Casa Ruiz |
|
San Diego, CA |
|
1976-1986 |
|
196 |
|
3,922,400 |
|
9,389,153 |
|
— |
|
2,384,821 |
|
3,922,400 |
|
11,773,975 |
|
15,696,375 |
|
(4,165,558 |
) |
11,530,817 |
|
— |
|
|||||||||
|
Cascade at Landmark |
|
Alexandria, VA |
|
1990 |
|
277 |
|
3,603,400 |
|
19,657,554 |
|
— |
|
3,143,091 |
|
3,603,400 |
|
22,800,644 |
|
26,404,044 |
|
(8,144,168 |
) |
18,259,876 |
|
— |
|
|||||||||
|
CenterPointe |
|
Beaverton, OR |
|
1996 |
|
264 |
|
3,421,535 |
|
15,708,853 |
|
— |
|
2,223,580 |
|
3,421,535 |
|
17,932,433 |
|
21,353,968 |
|
(3,907,448 |
) |
17,446,520 |
|
— |
|
|||||||||
|
Centre Club |
|
Ontario, CA |
|
1994 |
|
312 |
|
5,616,000 |
|
23,485,891 |
|
— |
|
1,510,601 |
|
5,616,000 |
|
24,996,492 |
|
30,612,492 |
|
(5,869,598 |
) |
24,742,894 |
|
— |
|
|||||||||
|
Centre Club II |
|
Ontario, CA |
|
2002 |
|
100 |
|
1,820,000 |
|
9,528,898 |
|
— |
|
204,951 |
|
1,820,000 |
|
9,733,849 |
|
11,553,849 |
|
(1,690,078 |
) |
9,863,771 |
|
— |
|
|||||||||
|
Champion Oaks |
|
Houston, TX |
|
1984 |
|
252 |
|
931,900 |
|
8,389,394 |
|
— |
|
1,843,161 |
|
931,900 |
|
10,232,555 |
|
11,164,455 |
|
(4,716,988 |
) |
6,447,467 |
|
— |
|
|||||||||
|
Chandler Court |
|
Chandler, AZ |
|
1987 |
|
312 |
|
1,353,100 |
|
12,175,173 |
|
— |
|
3,052,915 |
|
1,353,100 |
|
15,228,087 |
|
16,581,187 |
|
(6,692,817 |
) |
9,888,370 |
|
— |
|
|||||||||
|
Chantecleer Lakes Condominium Homes |
|
Naperville, IL |
|
1986 |
|
98 |
|
2,198,362 |
|
5,409,097 |
|
— |
|
1,576,810 |
|
2,198,362 |
|
6,985,907 |
|
9,184,269 |
|
(1,835,502 |
) |
7,348,767 |
|
— |
|
|||||||||
|
Chatelaine Park |
|
Duluth, GA |
|
1995 |
|
303 |
|
1,818,000 |
|
24,489,671 |
|
— |
|
1,037,802 |
|
1,818,000 |
|
25,527,473 |
|
27,345,473 |
|
(7,511,459 |
) |
19,834,014 |
|
— |
|
|||||||||
|
Chelsea Square |
|
Redmond, WA |
|
1991 |
|
113 |
|
3,397,100 |
|
9,289,074 |
|
— |
|
503,639 |
|
3,397,100 |
|
9,792,713 |
|
13,189,813 |
|
(3,037,454 |
) |
10,152,360 |
|
— |
|
|||||||||
|
Chestnut Hills |
|
Puyallup, WA |
|
1991 |
|
157 |
|
756,300 |
|
6,806,635 |
|
— |
|
995,919 |
|
756,300 |
|
7,802,554 |
|
8,558,854 |
|
(2,913,367 |
) |
5,645,486 |
|
— |
|
|||||||||
|
Chinatown Gateway (Land) |
|
Los Angeles, CA |
|
(F) |
|
— |
|
13,191,831 |
|
3,991,333 |
|
— |
|
— |
|
13,191,831 |
|
3,991,333 |
|
17,183,164 |
|
— |
|
17,183,164 |
|
— |
|
|||||||||
|
Cimarron Ridge |
|
Aurora, CO |
|
1984 |
|
296 |
|
1,591,100 |
|
14,320,031 |
|
— |
|
2,545,944 |
|
1,591,100 |
|
16,865,975 |
|
18,457,075 |
|
(6,598,783 |
) |
11,858,292 |
|
— |
|
|||||||||
|
City View (GA) |
|
Atlanta, GA (G) |
|
2003 |
|
202 |
|
6,440,800 |
|
19,992,518 |
|
— |
|
632,851 |
|
6,440,800 |
|
20,625,369 |
|
27,066,169 |
|
(1,708,955 |
) |
25,357,214 |
|
— |
|
|||||||||
|
Clarion |
|
Decatur, GA |
|
1990 |
|
217 |
|
1,504,300 |
|
13,537,919 |
|
— |
|
1,508,419 |
|
1,504,300 |
|
15,046,339 |
|
16,550,639 |
|
(4,999,128 |
) |
11,551,511 |
|
— |
|
|||||||||
|
Clarys Crossing |
|
Columbia, MD |
|
1984 |
|
198 |
|
891,000 |
|
15,489,721 |
|
— |
|
1,543,279 |
|
891,000 |
|
17,033,000 |
|
17,924,000 |
|
(5,209,534 |
) |
12,714,465 |
|
— |
|
|||||||||
|
Club at the Green |
|
Beaverton, OR |
|
1991 |
|
254 |
|
2,030,950 |
|
12,616,747 |
|
— |
|
1,967,019 |
|
2,030,950 |
|
14,583,766 |
|
16,614,716 |
|
(5,483,038 |
) |
11,131,679 |
|
— |
|
|||||||||
|
Coach Lantern |
|
Scarborough, ME |
|
1971/1981 |
|
90 |
|
452,900 |
|
4,405,723 |
|
— |
|
794,424 |
|
452,900 |
|
5,200,147 |
|
5,653,047 |
|
(1,766,626 |
) |
3,886,421 |
|
— |
|
|||||||||
|
Coachman Trails |
|
Plymouth, MN |
|
1987 |
|
154 |
|
1,227,000 |
|
9,517,381 |
|
— |
|
1,029,605 |
|
1,227,000 |
|
10,546,986 |
|
11,773,986 |
|
(3,457,671 |
) |
8,316,315 |
|
— |
|
|||||||||
|
Coconut Palm Club |
|
Coconut Creek, GA |
|
1992 |
|
300 |
|
3,001,700 |
|
17,678,928 |
|
— |
|
1,476,372 |
|
3,001,700 |
|
19,155,300 |
|
22,157,000 |
|
(6,129,308 |
) |
16,027,692 |
|
— |
|
|||||||||
|
Colinas Pointe |
|
Denver, CO |
|
1986 |
|
272 |
|
1,587,400 |
|
14,285,902 |
|
— |
|
1,463,344 |
|
1,587,400 |
|
15,749,246 |
|
17,336,646 |
|
(5,605,917 |
) |
11,730,729 |
|
— |
|
|||||||||
|
Collier Ridge |
|
Atlanta, GA |
|
1980 |
|
300 |
|
5,100,000 |
|
20,425,822 |
|
— |
|
4,033,049 |
|
5,100,000 |
|
24,458,871 |
|
29,558,871 |
|
(7,419,956 |
) |
22,138,915 |
|
— |
|
|||||||||
|
Colorado Pointe |
|
Denver, CO |
|
2006 |
|
193 |
|
5,790,000 |
|
28,815,766 |
|
— |
|
58,843 |
|
5,790,000 |
|
28,874,609 |
|
34,664,609 |
|
(716,602 |
) |
33,948,007 |
|
— |
|
|||||||||
|
Copper Canyon |
|
Highlands Ranch, CO |
|
1999 |
|
222 |
|
1,443,000 |
|
16,251,114 |
|
— |
|
793,560 |
|
1,443,000 |
|
17,044,673 |
|
18,487,673 |
|
(4,703,098 |
) |
13,784,575 |
|
— |
|
|||||||||
|
Copper Creek |
|
Tempe, AZ |
|
1984 |
|
144 |
|
1,017,400 |
|
9,148,068 |
|
— |
|
1,255,555 |
|
1,017,400 |
|
10,403,623 |
|
11,421,023 |
|
(3,772,096 |
) |
7,648,926 |
|
— |
|
|||||||||
|
Copper Terrace |
|
Orlando, FL |
|
1989 |
|
300 |
|
1,200,000 |
|
17,887,868 |
|
— |
|
2,648,075 |
|
1,200,000 |
|
20,535,943 |
|
21,735,943 |
|
(6,269,942 |
) |
15,466,001 |
|
— |
|
|||||||||
|
Cortona at Dana Park |
|
Mesa, AZ |
|
1986 |
|
222 |
|
2,028,939 |
|
12,466,128 |
|
— |
|
1,671,892 |
|
2,028,939 |
|
14,138,020 |
|
16,166,959 |
|
(4,898,170 |
) |
11,268,789 |
|
— |
|
|||||||||
|
Country Brook |
|
Chandler, AZ |
|
1986-1996 |
|
396 |
|
1,505,219 |
|
29,542,535 |
|
— |
|
2,370,420 |
|
1,505,219 |
|
31,912,955 |
|
33,418,174 |
|
(10,347,720 |
) |
23,070,454 |
|
— |
|
|||||||||
|
Country Gables |
|
Beaverton, OR |
|
1991 |
|
288 |
|
1,580,500 |
|
14,215,444 |
|
— |
|
2,819,737 |
|
1,580,500 |
|
17,035,181 |
|
18,615,681 |
|
(6,510,077 |
) |
12,105,603 |
|
— |
|
|||||||||
|
Cove at Boynton Beach I |
|
Boynton Beach, FL |
|
1996 |
|
252 |
|
12,600,000 |
|
31,590,391 |
|
— |
|
332,720 |
|
12,600,000 |
|
31,923,111 |
|
44,523,111 |
|
(2,251,184 |
) |
42,271,927 |
|
— |
|
|||||||||
|
Cove at Boynton Beach II |
|
Boynton Beach, FL |
|
1998 |
|
296 |
|
14,800,000 |
|
37,874,719 |
|
— |
|
— |
|
14,800,000 |
|
37,874,719 |
|
52,674,719 |
|
(2,646,714 |
) |
50,028,005 |
|
— |
|
|||||||||
|
Cove at Fishers Landing |
|
Vancouver, WA |
|
1993 |
|
253 |
|
2,277,000 |
|
15,656,887 |
|
— |
|
700,518 |
|
2,277,000 |
|
16,357,405 |
|
18,634,405 |
|
(3,138,452 |
) |
15,495,953 |
|
— |
|
|||||||||
|
Creekside Village |
|
Mountlake Terrace, WA |
|
1987 |
|
512 |
|
2,807,600 |
|
25,270,594 |
|
— |
|
3,299,425 |
|
2,807,600 |
|
28,570,019 |
|
31,377,619 |
|
(12,817,564 |
) |
18,560,055 |
|
— |
|
|||||||||
|
Creekwood |
|
Charlotte, NC |
|
1987-1990 |
|
384 |
|
1,861,700 |
|
16,740,569 |
|
— |
|
2,145,322 |
|
1,861,700 |
|
18,885,890 |
|
20,747,590 |
|
(6,669,019 |
) |
14,078,571 |
|
— |
|
|||||||||
|
Crescent at Cherry Creek |
|
Denver, CO |
|
1994 |
|
216 |
|
2,594,000 |
|
15,149,470 |
|
— |
|
1,076,462 |
|
2,594,000 |
|
16,225,932 |
|
18,819,932 |
|
(5,424,098 |
) |
13,395,834 |
|
— |
|
|||||||||
|
Crosswinds |
|
St. Petersburg, FL |
|
1986 |
|
208 |
|
1,561,200 |
|
5,756,822 |
|
— |
|
1,552,636 |
|
1,561,200 |
|
7,309,457 |
|
8,870,657 |
|
(2,850,054 |
) |
6,020,603 |
|
— |
|
|||||||||
|
Crowntree Lakes |
|
Orlando, FL |
|
(F) |
|
— |
|
12,009,630 |
|
206,669 |
|
— |
|
— |
|
12,009,630 |
|
206,669 |
|
12,216,299 |
|
— |
|
12,216,299 |
|
— |
|
|||||||||
|
Crystal Village |
|
Attleboro, MA |
|
1974 |
|
91 |
|
1,369,000 |
|
4,989,028 |
|
— |
|
2,177,092 |
|
1,369,000 |
|
7,166,120 |
|
8,535,120 |
|
(2,507,884 |
) |
6,027,236 |
|
— |
|
|||||||||
|
Cypress Lake at Waterford |
|
Orlando, Fl |
|
2001 |
|
316 |
|
7,000,000 |
|
27,654,816 |
|
— |
|
773,349 |
|
7,000,000 |
|
28,428,165 |
|
35,428,165 |
|
(3,229,623 |
) |
32,198,542 |
|
— |
|
|||||||||
S-4
EQUITY RESIDENTIAL
Schedule III - Real Estate and Accumulated Depreciation
December 31, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost Capitalized |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsequent to |
|
|
|
Gross Amount Carried |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Initial Cost to |
|
|
|
Acquisition |
|
|
|
at Close of |
|
|
|
|
|
|
|
|
|
|
|
|
Description |
|
|
|
|
|
Company |
|
|
|
(Improvements, net) (E) |
|
|
|
Period 12/31/06 |
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
Date of |
|
|
|
|
|
Building & |
|
|
|
Building & |
|
|
|
Building & |
|
|
|
Accumulated |
|
Investment in Real |
|
|
|
|
Apartment Name |
|
Location |
|
Construction |
|
Units (I) |
|
Land |
|
Fixtures |
|
Land |
|
Fixtures |
|
Land |
|
Fixtures (A) |
|
Total (B) |
|
Depreciation (C) |
|
Estate, Net at 12/31/06 |
|
Encumbrances |
|
|
Dartmouth Woods |
|
Lakewood, CO |
|
1990 |
|
201 |
|
1,609,800 |
|
10,832,754 |
|
— |
|
1,379,477 |
|
1,609,800 |
|
12,212,231 |
|
13,822,031 |
|
(4,419,618 |
) |
9,402,414 |
|
— |
|
|
Dean Estates |
|
Taunton, MA |
|
1984 |
|
58 |
|
498,080 |
|
3,329,560 |
|
— |
|
475,797 |
|
498,080 |
|
3,805,357 |
|
4,303,437 |
|
(918,462 |
) |
3,384,975 |
|
— |
|
|
Deerwood (SD) |
|
San Diego, CA |
|
1990 |
|
316 |
|
2,082,095 |
|
18,739,815 |
|
— |
|
5,532,754 |
|
2,082,095 |
|
24,272,569 |
|
26,354,664 |
|
(12,324,380 |
) |
14,030,284 |
|
— |
|
|
Defoor Village |
|
Atlanta, GA |
|
1997 |
|
156 |
|
2,966,400 |
|
10,570,210 |
|
— |
|
1,785,266 |
|
2,966,400 |
|
12,355,477 |
|
15,321,877 |
|
(3,697,813 |
) |
11,624,064 |
|
— |
|
|
Desert Homes |
|
Phoenix, AZ |
|
1982 |
|
412 |
|
1,481,050 |
|
13,390,249 |
|
— |
|
3,541,588 |
|
1,481,050 |
|
16,931,837 |
|
18,412,887 |
|
(7,202,820 |
) |
11,210,066 |
|
— |
|
|
Duraleigh Woods |
|
Raleigh, NC |
|
1987 |
|
362 |
|
1,629,000 |
|
19,917,750 |
|
— |
|
3,061,396 |
|
1,629,000 |
|
22,979,145 |
|
24,608,145 |
|
(7,470,099 |
) |
17,138,047 |
|
— |
|
|
Eagle Canyon |
|
Chino Hills, CA |
|
1985 |
|
252 |
|
1,808,900 |
|
16,426,168 |
|
— |
|
2,671,769 |
|
1,808,900 |
|
19,097,937 |
|
20,906,837 |
|
(6,842,353 |
) |
14,064,484 |
|
— |
|
|
Emerson Place |
|
Boston, MA (G) |
|
1962 |
|
444 |
|
14,855,000 |
|
57,566,636 |
|
— |
|
12,924,634 |
|
14,855,000 |
|
70,491,269 |
|
85,346,269 |
|
(24,626,242 |
) |
60,720,027 |
|
— |
|
|
Emerson Place/CRP II |
|
Boston, MA |
|
(F) |
|
— |
|
— |
|
42,597,465 |
|
— |
|
— |
|
— |
|
42,597,465 |
|
42,597,465 |
|
— |
|
42,597,465 |
|
— |
|
|
Enclave at Winston Park |
|
Coconut Creek, FL |
|
1995 |
|
278 |
|
5,560,000 |
|
19,939,324 |
|
— |
|
834,324 |
|
5,560,000 |
|
20,773,648 |
|
26,333,648 |
|
(4,021,894 |
) |
22,311,754 |
|
— |
|
|
Enclave, The |
|
Tempe, AZ |
|
1994 |
|
204 |
|
1,500,192 |
|
19,281,399 |
|
— |
|
928,687 |
|
1,500,192 |
|
20,210,085 |
|
21,710,277 |
|
(6,445,362 |
) |
15,264,915 |
|
— |
|
|
Estates at Wellington Green |
|
Wellington, FL |
|
2003 |
|
400 |
|
20,000,000 |
|
64,790,850 |
|
— |
|
349,308 |
|
20,000,000 |
|
65,140,158 |
|
85,140,158 |
|
(2,901,329 |
) |
82,238,829 |
|
— |
|
|
Estates at Maitland Summit |
|
Orlando, FL |
|
1998 |
|
272 |
|
9,520,000 |
|
28,301,909 |
|
— |
|
6,246 |
|
9,520,000 |
|
28,308,155 |
|
37,828,155 |
|
(491,690 |
) |
37,336,465 |
|
— |
|
|
Estates at Phipps |
|
Atlanta, GA |
|
1996 |
|
234 |
|
9,360,000 |
|
29,705,236 |
|
— |
|
1,651,994 |
|
9,360,000 |
|
31,357,230 |
|
40,717,230 |
|
(2,260,013 |
) |
38,457,217 |
|
— |
|
|
Estates at Tanglewood |
|
Westminster, CO |
|
2003 |
|
504 |
|
7,560,000 |
|
51,256,538 |
|
— |
|
680,745 |
|
7,560,000 |
|
51,937,283 |
|
59,497,283 |
|
(3,931,705 |
) |
55,565,578 |
|
— |
|
|
Fairfield |
|
Stamford, CT (G) |
|
1996 |
|
263 |
|
6,510,200 |
|
39,690,120 |
|
— |
|
3,844,536 |
|
6,510,200 |
|
43,534,656 |
|
50,044,856 |
|
(12,747,627 |
) |
37,297,229 |
|
— |
|
|
Fairland Gardens |
|
Silver Spring, MD |
|
1981 |
|
400 |
|
6,000,000 |
|
19,972,183 |
|
— |
|
4,285,270 |
|
6,000,000 |
|
24,257,453 |
|
30,257,453 |
|
(7,346,146 |
) |
22,911,307 |
|
— |
|
|
Fairway Greens, LLC |
|
Pembroke Pines, FL |
|
1987 |
|
2 |
|
12,622 |
|
140,229 |
|
— |
|
(3,961 |
) |
12,622 |
|
136,268 |
|
148,890 |
|
(37,812 |
) |
111,078 |
|
— |
|
|
Farnham Park |
|
Houston, TX |
|
1996 |
|
216 |
|
1,512,600 |
|
14,233,760 |
|
— |
|
899,939 |
|
1,512,600 |
|
15,133,699 |
|
16,646,299 |
|
(4,940,281 |
) |
11,706,017 |
|
— |
|
|
Fifth Avenue North Combined |
|
Seattle, WA (G) |
|
2002 |
|
6 |
|
489,188 |
|
826,405 |
|
— |
|
(400,162 |
) |
489,188 |
|
426,242 |
|
915,430 |
|
— |
|
915,430 |
|
— |
|
|
Four Lakes Athletic Club |
|
Lisle, IL (G) |
|
N/A |
|
— |
|
50,000 |
|
153,489 |
|
— |
|
227,651 |
|
50,000 |
|
381,140 |
|
431,140 |
|
(88,962 |
) |
342,178 |
|
— |
|
|
Fox Run (WA) |
|
Federal Way, WA |
|
1988 |
|
144 |
|
639,700 |
|
5,765,018 |
|
— |
|
1,212,156 |
|
639,700 |
|
6,977,174 |
|
7,616,874 |
|
(3,276,285 |
) |
4,340,590 |
|
— |
|
|
Fox Run II (WA) |
|
Federal Way, WA |
|
1988 |
|
18 |
|
80,000 |
|
1,286,139 |
|
— |
|
53,086 |
|
80,000 |
|
1,339,225 |
|
1,419,225 |
|
(184,368 |
) |
1,234,857 |
|
— |
|
|
Foxcroft |
|
Scarborough, ME |
|
1977/1979 |
|
104 |
|
523,400 |
|
4,527,409 |
|
— |
|
832,452 |
|
523,400 |
|
5,359,861 |
|
5,883,261 |
|
(1,828,747 |
) |
4,054,514 |
|
— |
|
|
Gables Grand Plaza |
|
Coral Gables, FL (G) |
|
1998 |
|
195 |
|
— |
|
44,601,000 |
|
— |
|
1,015,213 |
|
— |
|
45,616,213 |
|
45,616,213 |
|
(5,208,168 |
) |
40,408,045 |
|
— |
|
|
Gatehouse at Pine Lake |
|
Pembroke Pines, FL |
|
1990 |
|
296 |
|
1,896,600 |
|
17,070,795 |
|
— |
|
1,812,803 |
|
1,896,600 |
|
18,883,598 |
|
20,780,198 |
|
(7,094,803 |
) |
13,685,395 |
|
— |
|
|
Gatehouse on the Green |
|
Plantation, FL |
|
1990 |
|
312 |
|
2,228,200 |
|
20,056,270 |
|
— |
|
2,444,883 |
|
2,228,200 |
|
22,501,153 |
|
24,729,353 |
|
(8,394,116 |
) |
16,335,237 |
|
— |
|
|
Gates of Redmond |
|
Redmond, WA |
|
1979 |
|
180 |
|
2,306,100 |
|
12,064,015 |
|
— |
|
1,292,538 |
|
2,306,100 |
|
13,356,553 |
|
15,662,653 |
|
(4,602,577 |
) |
11,060,075 |
|
— |
|
|
Gateway at Malden Center |
|
Malden, MA (G) |
|
1988 |
|
203 |
|
9,209,780 |
|
25,722,666 |
|
— |
|
3,349,436 |
|
9,209,780 |
|
29,072,102 |
|
38,281,882 |
|
(4,225,495 |
) |
34,056,387 |
|
— |
|
|
Gatewood |
|
Pleasanton, CA |
|
1985 |
|
200 |
|
6,796,511 |
|
20,249,392 |
|
— |
|
1,465,733 |
|
6,796,511 |
|
21,715,125 |
|
28,511,636 |
|
(3,050,358 |
) |
25,461,278 |
|
— |
|
|
Glastonbury Center |
|
Glastonbury, CT |
|
1962 |
|
105 |
|
852,606 |
|
5,699,497 |
|
— |
|
550,273 |
|
852,606 |
|
6,249,770 |
|
7,102,376 |
|
(1,532,652 |
) |
5,569,724 |
|
— |
|
|
Gramercy Park |
|
Houston, TX |
|
1998 |
|
384 |
|
3,957,000 |
|
22,075,243 |
|
— |
|
1,763,341 |
|
3,957,000 |
|
23,838,584 |
|
27,795,584 |
|
(4,956,657 |
) |
22,838,927 |
|
— |
|
|
Granada Highlands |
|
Malden, MA (G) |
|
1972 |
|
919 |
|
28,210,000 |
|
99,944,576 |
|
— |
|
21,184,728 |
|
28,210,000 |
|
121,129,305 |
|
149,339,305 |
|
(31,588,191 |
) |
117,751,113 |
|
— |
|
|
Grandeville at River Place |
|
Oviedo, FL |
|
2002 |
|
280 |
|
6,000,000 |
|
23,114,693 |
|
— |
|
1,117,815 |
|
6,000,000 |
|
24,232,508 |
|
30,232,508 |
|
(2,933,052 |
) |
27,299,456 |
|
— |
|
|
Greenfield Village |
|
Rocky Hill , CT |
|
1965 |
|
151 |
|
911,534 |
|
6,093,418 |
|
— |
|
494,673 |
|
911,534 |
|
6,588,092 |
|
7,499,626 |
|
(1,561,181 |
) |
5,938,445 |
|
— |
|
|
Greentree 1 |
|
Glen Burnie, MD |
|
1973 |
|
350 |
|
3,912,968 |
|
11,784,021 |
|
— |
|
5,618,784 |
|
3,912,968 |
|
17,402,805 |
|
21,315,773 |
|
(4,926,427 |
) |
16,389,346 |
|
— |
|
|
Greentree 2 |
|
Glen Burnie, MD |
|
1973 |
|
239 |
|
2,700,000 |
|
8,246,737 |
|
— |
|
3,743,353 |
|
2,700,000 |
|
11,990,090 |
|
14,690,090 |
|
(3,119,348 |
) |
11,570,741 |
|
— |
|
|
Greentree 3 |
|
Glen Burnie, MD |
|
1973 |
|
207 |
|
2,380,443 |
|
7,270,294 |
|
— |
|
3,263,587 |
|
2,380,443 |
|
10,533,881 |
|
12,914,324 |
|
(2,712,856 |
) |
10,201,468 |
|
— |
|
|
Hammocks Place |
|
Miami, FL |
|
1986 |
|
296 |
|
319,180 |
|
12,513,467 |
|
— |
|
2,144,153 |
|
319,180 |
|
14,657,620 |
|
14,976,800 |
|
(7,053,999 |
) |
7,922,801 |
|
— |
|
|
Hamptons |
|
Puyallup, WA |
|
1991 |
|
230 |
|
1,119,200 |
|
10,075,844 |
|
— |
|
1,220,603 |
|
1,119,200 |
|
11,296,447 |
|
12,415,647 |
|
(4,116,061 |
) |
8,299,586 |
|
— |
|
|
Harborview |
|
San Pedro, CA |
|
1985 |
|
160 |
|
6,402,500 |
|
12,627,347 |
|
— |
|
1,516,656 |
|
6,402,500 |
|
14,144,003 |
|
20,546,503 |
|
(5,153,082 |
) |
15,393,421 |
|
— |
|
|
Harbour Town |
|
Boca Raton, FL |
|
1985 |
|
392 |
|
11,760,000 |
|
20,190,252 |
|
— |
|
4,862,069 |
|
11,760,000 |
|
25,052,321 |
|
36,812,321 |
|
(7,104,611 |
) |
29,707,710 |
|
— |
|
|
Hathaway |
|
Long Beach, CA |
|
1987 |
|
385 |
|
2,512,500 |
|
22,611,912 |
|
— |
|
4,084,554 |
|
2,512,500 |
|
26,696,465 |
|
29,208,965 |
|
(10,830,627 |
) |
18,378,338 |
|
— |
|
|
Heights on Capitol Hill |
|
Seattle, WA (G) |
|
2006 |
|
104 |
|
5,425,000 |
|
21,102,842 |
|
— |
|
3,400 |
|
5,425,000 |
|
21,106,242 |
|
26,531,242 |
|
(77,367 |
) |
26,453,874 |
|
— |
|
|
Heritage Ridge |
|
Lynwood, WA |
|
1999 |
|
197 |
|
6,895,000 |
|
18,983,597 |
|
— |
|
32,613 |
|
6,895,000 |
|
19,016,210 |
|
25,911,210 |
|
(444,572 |
) |
25,466,638 |
|
— |
|
|
Heritage, The |
|
Phoenix, AZ |
|
1995 |
|
204 |
|
1,211,205 |
|
13,136,903 |
|
— |
|
876,356 |
|
1,211,205 |
|
14,013,259 |
|
15,224,464 |
|
(4,599,536 |
) |
10,624,929 |
|
— |
|
|
Heron Pointe |
|
Boynton Beach, FL |
|
1989 |
|
192 |
|
1,546,700 |
|
7,774,676 |
|
— |
|
1,285,073 |
|
1,546,700 |
|
9,059,749 |
|
10,606,449 |
|
(3,449,996 |
) |
7,156,453 |
|
— |
|
|
Hidden Lakes |
|
Haltom City, TX |
|
1996 |
|
312 |
|
1,872,000 |
|
20,242,109 |
|
— |
|
1,382,580 |
|
1,872,000 |
|
21,624,689 |
|
23,496,689 |
|
(6,530,976 |
) |
16,965,712 |
|
— |
|
|
Hidden Oaks |
|
Cary, NC |
|
1988 |
|
216 |
|
1,178,600 |
|
10,614,135 |
|
— |
|
2,045,175 |
|
1,178,600 |
|
12,659,310 |
|
13,837,910 |
|
(4,667,272 |
) |
9,170,638 |
|
— |
|
|
Hidden Palms |
|
Tampa, FL |
|
1986 |
|
256 |
|
2,049,600 |
|
6,345,885 |
|
— |
|
1,917,063 |
|
2,049,600 |
|
8,262,948 |
|
10,312,548 |
|
(3,281,502 |
) |
7,031,046 |
|
— |
|
|
Highland Glen |
|
Westwood, MA |
|
1979 |
|
180 |
|
2,229,095 |
|
16,828,153 |
|
— |
|
875,906 |
|
2,229,095 |
|
17,704,060 |
|
19,933,155 |
|
(3,799,499 |
) |
16,133,656 |
|
— |
|
|
Highlands, The |
|
Scottsdale, AZ |
|
1990 |
|
272 |
|
11,823,840 |
|
31,990,970 |
|
— |
|
1,988,178 |
|
11,823,840 |
|
33,979,148 |
|
45,802,988 |
|
(1,292,483 |
) |
44,510,505 |
|
— |
|
|
Hudson Crossing |
|
New York, NY (G) |
|
2003 |
|
259 |
|
23,420,000 |
|
70,086,385 |
|
— |
|
221,972 |
|
23,420,000 |
|
70,308,357 |
|
93,728,357 |
|
(6,183,117 |
) |
87,545,240 |
|
— |
|
|
Hudson Crossing II |
|
New York, NY |
|
(F) |
|
— |
|
13,177,769 |
|
3,517,127 |
|
— |
|
— |
|
13,177,769 |
|
3,517,127 |
|
16,694,895 |
|
— |
|
16,694,895 |
|
— |
|
|
Hudson Pointe |
|
Jersey City, NJ |
|
2003 |
|
182 |
|
5,148,500 |
|
41,013,460 |
|
— |
|
299,906 |
|
5,148,500 |
|
41,313,365 |
|
46,461,865 |
|
(4,267,517 |
) |
42,194,348 |
|
— |
|
|
Hunt Club |
|
Charlotte, NC |
|
1990 |
|
300 |
|
990,000 |
|
17,992,887 |
|
— |
|
1,154,961 |
|
990,000 |
|
19,147,849 |
|
20,137,849 |
|
(5,850,067 |
) |
14,287,781 |
|
— |
|
|
Hunt Club II |
|
Charlotte, NC |
|
(F) |
|
— |
|
100,000 |
|
— |
|
— |
|
— |
|
100,000 |
|
— |
|
100,000 |
|
— |
|
100,000 |
|
— |
|
|
Huntington Park |
|
Everett, WA |
|
1991 |
|
381 |
|
1,597,500 |
|
14,367,864 |
|
— |
|
2,518,625 |
|
1,597,500 |
|
16,886,489 |
|
18,483,989 |
|
(7,804,784 |
) |
10,679,205 |
|
— |
|
|
Indian Bend |
|
Scottsdale, AZ |
|
1973 |
|
277 |
|
1,075,700 |
|
9,800,330 |
|
— |
|
2,673,652 |
|
1,075,700 |
|
12,473,982 |
|
13,549,682 |
|
(6,042,389 |
) |
7,507,293 |
|
— |
|
|
Indian Tree |
|
Arvada, CO |
|
1983 |
|
168 |
|
881,225 |
|
4,552,815 |
|
— |
|
1,766,348 |
|
881,225 |
|
6,319,163 |
|
7,200,388 |
|
(3,386,758 |
) |
3,813,630 |
|
— |
|
|
Indigo Springs |
|
Kent, WA |
|
1991 |
|
278 |
|
1,270,500 |
|
11,446,902 |
|
— |
|
2,215,795 |
|
1,270,500 |
|
13,662,697 |
|
14,933,197 |
|
(5,404,642 |
) |
9,528,555 |
|
— |
|
|
Ivy Place |
|
Atlanta, GA |
|
1978 |
|
122 |
|
802,950 |
|
7,228,257 |
|
— |
|
1,738,715 |
|
802,950 |
|
8,966,972 |
|
9,769,922 |
|
(3,535,461 |
) |
6,234,461 |
|
— |
|
|
Junipers at Yarmouth |
|
Yarmouth, ME |
|
1970 |
|
225 |
|
1,355,700 |
|
7,860,135 |
|
— |
|
1,996,205 |
|
1,355,700 |
|
9,856,340 |
|
11,212,040 |
|
(3,794,278 |
) |
7,417,761 |
|
— |
|
|
Kempton Downs |
|
Gresham, OR |
|
1990 |
|
278 |
|
1,217,349 |
|
10,943,372 |
|
— |
|
2,235,902 |
|
1,217,349 |
|
13,179,273 |
|
14,396,622 |
|
(5,916,913 |
) |
8,479,709 |
|
— |
|
|
Kenwood Mews |
|
Burbank, CA |
|
1991 |
|
141 |
|
14,100,000 |
|
24,622,612 |
|
— |
|
1,848 |
|
14,100,000 |
|
24,624,460 |
|
38,724,460 |
|
(383,877 |
) |
38,340,583 |
|
— |
|
|
Keystone |
|
Austin, TX |
|
1981 |
|
166 |
|
498,500 |
|
4,487,295 |
|
— |
|
1,547,837 |
|
498,500 |
|
6,035,133 |
|
6,533,633 |
|
(2,961,334 |
) |
3,572,298 |
|
— |
|
|
Kings Colony |
|
Miami, FL |
|
1986 |
|
480 |
|
19,200,000 |
|
48,378,023 |
|
— |
|
257,964 |
|
19,200,000 |
|
48,635,987 |
|
67,835,987 |
|
(2,458,570 |
) |
65,377,418 |
|
— |
|
|
Kingsport |
|
Alexandria, VA |
|
1986 |
|
416 |
|
1,262,250 |
|
12,198,188 |
|
— |
|
4,334,005 |
|
1,262,250 |
|
16,532,194 |
|
17,794,444 |
|
(7,426,728 |
) |
10,367,716 |
|
— |
|
|
Kirby Place |
|
Houston, TX |
|
1994 |
|
362 |
|
3,621,600 |
|
25,896,774 |
|
— |
|
1,899,748 |
|
3,621,600 |
|
27,796,522 |
|
31,418,122 |
|
(9,307,656 |
) |
22,110,466 |
|
— |
|
|
La Mirage |
|
San Diego, CA |
|
1988/1992 |
|
1,070 |
|
28,895,200 |
|
95,567,943 |
|
— |
|
7,199,796 |
|
28,895,200 |
|
102,767,738 |
|
131,662,938 |
|
(34,836,363 |
) |
96,826,576 |
|
— |
|
|
La Mirage IV |
|
San Diego, CA |
|
2001 |
|
340 |
|
6,000,000 |
|
47,449,353 |
|
— |
|
848,077 |
|
6,000,000 |
|
48,297,430 |
|
54,297,430 |
|
(8,904,407 |
) |
45,393,023 |
|
— |
|
|
La Tour Fontaine |
|
Houston, TX |
|
1994 |
|
162 |
|
2,916,000 |
|
15,917,178 |
|
— |
|
1,180,868 |
|
2,916,000 |
|
17,098,046 |
|
20,014,046 |
|
(5,182,559 |
) |
14,831,487 |
|
— |
|
|
Lakes at Vinings |
|
Atlanta, GA |
|
1972/1975 |
|
464 |
|
6,498,000 |
|
21,832,252 |
|
— |
|
2,882,527 |
|
6,498,000 |
|
24,714,779 |
|
31,212,779 |
|
(8,123,649 |
) |
23,089,129 |
|
— |
|
|
Lakeshore at Preston |
|
Plano, TX |
|
1992 |
|
302 |
|
3,325,800 |
|
15,208,348 |
|
— |
|
2,028,442 |
|
3,325,800 |
|
17,236,789 |
|
20,562,589 |
|
(5,350,594 |
) |
15,211,996 |
|
— |
|
|
Lakeville Resort |
|
Petaluma, CA |
|
1984 |
|
492 |
|
2,736,500 |
|
24,610,651 |
|
— |
|
4,067,520 |
|
2,736,500 |
|
28,678,171 |
|
31,414,671 |
|
(11,115,508 |
) |
20,299,163 |
|
— |
|
|
Lakewood Oaks |
|
Dallas, TX |
|
1987 |
|
352 |
|
1,631,600 |
|
14,686,192 |
|
— |
|
3,279,166 |
|
1,631,600 |
|
17,965,357 |
|
19,596,957 |
|
(8,029,747 |
) |
11,567,210 |
|
— |
|
|
Landings at Port Imperial |
|
W. New York, NJ |
|
1999 |
|
276 |
|
27,246,045 |
|
37,741,050 |
|
— |
|
882,249 |
|
27,246,045 |
|
38,623,298 |
|
65,869,343 |
|
(8,230,557 |
) |
57,638,786 |
|
— |
|
|
Larkspur Shores |
|
Hilliard, OH |
|
1983 |
|
342 |
|
17,107,300 |
|
31,399,237 |
|
— |
|
4,308,968 |
|
17,107,300 |
|
35,708,205 |
|
52,815,505 |
|
(11,956,101 |
) |
40,859,404 |
|
— |
|
|
Larkspur Woods |
|
Sacramento, CA |
|
1989/1993 |
|
232 |
|
5,802,900 |
|
14,576,106 |
|
— |
|
1,542,005 |
|
5,802,900 |
|
16,118,112 |
|
21,921,012 |
|
(5,554,100 |
) |
16,366,912 |
|
— |
|
|
Laurel Ridge |
|
Chapel Hill, NC |
|
1975 |
|
160 |
|
160,000 |
|
3,206,076 |
|
— |
|
3,911,569 |
|
160,000 |
|
7,117,645 |
|
7,277,645 |
|
(4,932,549 |
) |
2,345,096 |
|
— |
|
|
Laurel Ridge II |
|
Chapel Hill, NC |
|
(F) |
|
— |
|
22,551 |
|
— |
|
— |
|
— |
|
22,551 |
|
— |
|
22,551 |
|
— |
|
22,551 |
|
— |
|
|
Lexington Farm |
|
Alpharetta, GA |
|
1995 |
|
352 |
|
3,521,900 |
|
22,888,305 |
|
— |
|
1,764,602 |
|
3,521,900 |
|
24,652,907 |
|
28,174,807 |
|
(7,201,543 |
) |
20,973,264 |
|
— |
|
|
Lexington Park |
|
Orlando, FL |
|
1988 |
|
252 |
|
2,016,000 |
|
12,346,726 |
|
— |
|
1,999,917 |
|
2,016,000 |
|
14,346,642 |
|
16,362,642 |
|
(4,568,150 |
) |
11,794,493 |
|
— |
|
|
Lincoln Green |
|
Pleasant Hill, CA |
|
1973 |
|
252 |
|
15,000,000 |
|
24,335,499 |
|
— |
|
34,297 |
|
15,000,000 |
|
24,369,795 |
|
39,369,795 |
|
(1,099,329 |
) |
38,270,466 |
|
— |
|
|
Little Cottonwoods |
|
Tempe, AZ |
|
1984 |
|
379 |
|
3,050,133 |
|
26,991,689 |
|
— |
|
2,504,455 |
|
3,050,133 |
|
29,496,145 |
|
32,546,278 |
|
(9,768,618 |
) |
22,777,659 |
|
— |
|
|
Lofton Place |
|
Tampa, FL |
|
1988 |
|
280 |
|
2,240,000 |
|
16,679,214 |
|
— |
|
2,077,089 |
|
2,240,000 |
|
18,756,303 |
|
20,996,303 |
|
(5,843,509 |
) |
15,152,794 |
|
— |
|
|
Longfellow Place |
|
Boston, MA (G) |
|
1975 |
|
710 |
|
53,164,160 |
|
183,940,619 |
|
— |
|
30,254,795 |
|
53,164,160 |
|
214,195,414 |
|
267,359,574 |
|
(60,712,369 |
) |
206,647,205 |
|
— |
|
|
Longview Place |
|
Waltham, MA |
|
2004 |
|
348 |
|
20,880,000 |
|
90,255,509 |
|
— |
|
79,293 |
|
20,880,000 |
|
90,334,802 |
|
111,214,802 |
|
(5,458,557 |
) |
105,756,245 |
|
— |
|
|
Madison at Stone Creek |
|
Austin, TX |
|
1995 |
|
390 |
|
2,535,000 |
|
22,611,700 |
|
— |
|
1,848,920 |
|
2,535,000 |
|
24,460,620 |
|
26,995,620 |
|
(7,436,946 |
) |
19,558,674 |
|
— |
|
|
Madison at the Arboretum |
|
Austin, TX |
|
1995 |
|
161 |
|
1,046,500 |
|
9,638,269 |
|
— |
|
1,952,393 |
|
1,046,500 |
|
11,590,662 |
|
12,637,162 |
|
(3,471,984 |
) |
9,165,178 |
|
— |
|
|
Madison at Walnut Creek |
|
Austin, TX |
|
1994 |
|
342 |
|
2,737,600 |
|
14,623,574 |
|
— |
|
1,835,038 |
|
2,737,600 |
|
16,458,612 |
|
19,196,212 |
|
(5,852,372 |
) |
13,343,840 |
|
— |
|
|
Madison at Wells Branch |
|
Austin, TX |
|
1995 |
|
300 |
|
2,377,344 |
|
16,370,879 |
|
— |
|
2,158,072 |
|
2,377,344 |
|
18,528,951 |
|
20,906,295 |
|
(4,671,141 |
) |
16,235,154 |
|
— |
|
|
Madison on Melrose |
|
Richardson, TX |
|
1995 |
|
200 |
|
1,300,000 |
|
15,096,551 |
|
— |
|
829,103 |
|
1,300,000 |
|
15,925,654 |
|
17,225,654 |
|
(4,675,241 |
) |
12,550,413 |
|
— |
|
|
Madison on the Parkway |
|
Dallas, TX |
|
1995 |
|
376 |
|
2,444,000 |
|
22,505,043 |
|
— |
|
2,081,282 |
|
2,444,000 |
|
24,586,325 |
|
27,030,325 |
|
(7,384,461 |
) |
19,645,864 |
|
— |
|
S-5
EQUITY RESIDENTIAL
Schedule III - Real Estate and Accumulated Depreciation
December 31, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost Capitalized |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsequent to |
|
|
|
Gross Amount Carried |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Initial Cost to |
|
|
|
Acquisition |
|
|
|
at Close of |
|
|
|
|
|
|
|
|
|
|
|
|
Description |
|
|
|
|
|
Company |
|
|
|
(Improvements, net) (E) |
|
|
|
Period 12/31/06 |
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
Date of |
|
|
|
|
|
Building & |
|
|
|
Building & |
|
|
|
Building & |
|
|
|
Accumulated |
|
Investment in Real |
|
|
|
|
Apartment Name |
|
Location |
|
Construction |
|
Units (I) |
|
Land |
|
Fixtures |
|
Land |
|
Fixtures |
|
Land |
|
Fixtures (A) |
|
Total (B) |
|
Depreciation (C) |
|
Estate, Net at 12/31/06 |
|
Encumbrances |
|
|
Magnolia at Whitlock |
|
Marietta, GA |
|
1971 |
|
152 |
|
132,979 |
|
1,526,005 |
|
— |
|
3,782,685 |
|
132,979 |
|
5,308,690 |
|
5,441,668 |
|
(3,581,897 |
) |
1,859,771 |
|
— |
|
|
Mariners Wharf |
|
Orange Park, FL |
|
1989 |
|
272 |
|
1,861,200 |
|
16,744,951 |
|
— |
|
2,127,022 |
|
1,861,200 |
|
18,871,973 |
|
20,733,173 |
|
(6,234,520 |
) |
14,498,652 |
|
— |
|
|
Marquessa |
|
Corona Hills, CA |
|
1992 |
|
336 |
|
6,888,500 |
|
21,604,584 |
|
— |
|
2,176,400 |
|
6,888,500 |
|
23,780,983 |
|
30,669,483 |
|
(8,110,280 |
) |
22,559,203 |
|
— |
|
|
Martha Lake |
|
Lynnwood, WA |
|
1991 |
|
155 |
|
821,200 |
|
7,405,070 |
|
— |
|
1,531,105 |
|
821,200 |
|
8,936,176 |
|
9,757,376 |
|
(3,324,988 |
) |
6,432,388 |
|
— |
|
|
Merrill Creek |
|
Lakewood, WA |
|
1994 |
|
149 |
|
814,200 |
|
7,330,606 |
|
— |
|
664,425 |
|
814,200 |
|
7,995,031 |
|
8,809,231 |
|
(2,833,005 |
) |
5,976,226 |
|
— |
|
|
Metro on First |
|
Seattle, WA (G) |
|
2002 |
|
102 |
|
8,540,000 |
|
12,209,981 |
|
— |
|
69,697 |
|
8,540,000 |
|
12,279,678 |
|
20,819,678 |
|
(870,026 |
) |
19,949,652 |
|
— |
|
|
Milano Terrace Private Residences |
|
Scottsdale, AZ |
|
1984 |
|
71 |
|
1,061,993 |
|
6,356,901 |
|
— |
|
1,748,516 |
|
1,061,993 |
|
8,105,417 |
|
9,167,410 |
|
(1,897,428 |
) |
7,269,982 |
|
— |
|
|
Mill Creek |
|
Milpitas, CA |
|
1991 |
|
516 |
|
12,858,693 |
|
57,168,503 |
|
— |
|
1,334,067 |
|
12,858,693 |
|
58,502,570 |
|
71,361,263 |
|
(8,255,094 |
) |
63,106,169 |
|
— |
|
|
Millbrook I |
|
Alexandria, VA |
|
1996 |
|
406 |
|
24,360,000 |
|
86,177,543 |
|
— |
|
42,227 |
|
24,360,000 |
|
86,219,770 |
|
110,579,770 |
|
(3,923,864 |
) |
106,655,905 |
|
— |
|
|
Mira Flores |
|
Palm Beach Gardens, FL |
|
1996 |
|
352 |
|
7,040,000 |
|
22,515,299 |
|
— |
|
852,627 |
|
7,040,000 |
|
23,367,926 |
|
30,407,926 |
|
(4,658,817 |
) |
25,749,108 |
|
— |
|
|
Mission Bay |
|
Orlando, FL |
|
1991 |
|
304 |
|
2,432,000 |
|
21,623,560 |
|
— |
|
1,617,988 |
|
2,432,000 |
|
23,241,549 |
|
25,673,549 |
|
(7,036,480 |
) |
18,637,069 |
|
— |
|
|
Missions at Sunbow |
|
Chula Vista, CA |
|
2003 |
|
336 |
|
28,560,000 |
|
59,287,427 |
|
— |
|
164,982 |
|
28,560,000 |
|
59,452,409 |
|
88,012,409 |
|
(3,692,391 |
) |
84,320,018 |
|
— |
|
|
Misty Woods |
|
Cary, NC |
|
1984 |
|
360 |
|
720,790 |
|
18,063,934 |
|
— |
|
2,650,973 |
|
720,790 |
|
20,714,907 |
|
21,435,697 |
|
(7,094,334 |
) |
14,341,363 |
|
— |
|
|
Montecito |
|
Valencia, CA |
|
1999 |
|
210 |
|
8,400,000 |
|
24,709,146 |
|
— |
|
1,010,303 |
|
8,400,000 |
|
25,719,449 |
|
34,119,449 |
|
(5,509,670 |
) |
28,609,779 |
|
— |
|
|
Monterra in Mill Creek |
|
Mill Creek, WA |
|
2003 |
|
139 |
|
2,800,000 |
|
13,255,123 |
|
— |
|
112,437 |
|
2,800,000 |
|
13,367,560 |
|
16,167,560 |
|
(1,159,046 |
) |
15,008,514 |
|
— |
|
|
Montevista |
|
Dallas, TX |
|
2000 |
|
350 |
|
3,931,550 |
|
19,788,568 |
|
— |
|
1,073,778 |
|
3,931,550 |
|
20,862,346 |
|
24,793,896 |
|
(4,151,265 |
) |
20,642,631 |
|
— |
|
|
Montclair Metro |
|
Montclair, NJ |
|
(F) |
|
— |
|
2,208,343 |
|
1,876,675 |
|
— |
|
— |
|
2,208,343 |
|
1,876,675 |
|
4,085,018 |
|
— |
|
4,085,018 |
|
— |
|
|
Morningside |
|
Scottsdale, AZ |
|
1989 |
|
160 |
|
670,470 |
|
12,607,976 |
|
— |
|
1,018,022 |
|
670,470 |
|
13,625,998 |
|
14,296,468 |
|
(4,539,150 |
) |
9,757,318 |
|
— |
|
|
Mountain Park Ranch |
|
Phoenix, AZ |
|
1994 |
|
240 |
|
1,662,332 |
|
18,260,276 |
|
— |
|
1,282,342 |
|
1,662,332 |
|
19,542,618 |
|
21,204,950 |
|
(6,461,637 |
) |
14,743,312 |
|
— |
|
|
Mountain Terrace |
|
Stevenson Ranch, CA |
|
1992 |
|
510 |
|
3,966,500 |
|
35,814,995 |
|
— |
|
2,582,625 |
|
3,966,500 |
|
38,397,620 |
|
42,364,120 |
|
(13,712,782 |
) |
28,651,338 |
|
— |
|
|
Newport Heights |
|
Tukwila, WA |
|
1985 |
|
80 |
|
391,200 |
|
3,522,780 |
|
— |
|
754,129 |
|
391,200 |
|
4,276,909 |
|
4,668,109 |
|
(2,030,416 |
) |
2,637,693 |
|
— |
|
|
North Pier at Harborside |
|
Jersey City, NJ |
|
2003 |
|
297 |
|
4,000,159 |
|
94,681,052 |
|
— |
|
377,442 |
|
4,000,159 |
|
95,058,494 |
|
99,058,653 |
|
(9,178,311 |
) |
89,880,343 |
|
— |
|
|
Northampton 2 |
|
Largo, MD |
|
1988 |
|
276 |
|
1,513,500 |
|
14,246,990 |
|
— |
|
2,574,425 |
|
1,513,500 |
|
16,821,415 |
|
18,334,915 |
|
(7,489,500 |
) |
10,845,415 |
|
— |
|
|
Northlake (MD) |
|
Germantown, MD |
|
1985 |
|
304 |
|
15,000,000 |
|
23,142,302 |
|
— |
|
6,499,373 |
|
15,000,000 |
|
29,641,675 |
|
44,641,675 |
|
(1,908,165 |
) |
42,733,510 |
|
— |
|
|
Northridge |
|
Pleasant Hill, CA |
|
1974 |
|
221 |
|
5,527,800 |
|
14,691,705 |
|
— |
|
2,171,747 |
|
5,527,800 |
|
16,863,452 |
|
22,391,252 |
|
(5,749,674 |
) |
16,641,577 |
|
— |
|
|
Northwoods Village |
|
Cary, NC |
|
1986 |
|
228 |
|
1,369,700 |
|
11,460,337 |
|
— |
|
2,155,446 |
|
1,369,700 |
|
13,615,783 |
|
14,985,483 |
|
(4,997,276 |
) |
9,988,207 |
|
— |
|
|
Oaks (NC) |
|
Charlotte, NC |
|
1996 |
|
318 |
|
2,196,744 |
|
23,601,540 |
|
— |
|
792,240 |
|
2,196,744 |
|
24,393,780 |
|
26,590,524 |
|
(7,155,627 |
) |
19,434,897 |
|
— |
|
|
Oaks at Falls Church |
|
Falls Church, VA |
|
1966 |
|
176 |
|
20,240,000 |
|
20,152,616 |
|
— |
|
1,262,957 |
|
20,240,000 |
|
21,415,573 |
|
41,655,573 |
|
(926,752 |
) |
40,728,821 |
|
— |
|
|
Ocean Crest |
|
Solana Beach, CA |
|
1986 |
|
146 |
|
5,111,200 |
|
11,910,438 |
|
— |
|
1,221,892 |
|
5,111,200 |
|
13,132,330 |
|
18,243,530 |
|
(4,082,916 |
) |
14,160,614 |
|
— |
|
|
Olympus Towers |
|
Seattle, WA (G) |
|
2000 |
|
328 |
|
14,752,034 |
|
73,376,841 |
|
— |
|
393,564 |
|
14,752,034 |
|
73,770,405 |
|
88,522,439 |
|
(8,316,047 |
) |
80,206,392 |
|
— |
|
|
Orchard Ridge |
|
Lynnwood, WA |
|
1988 |
|
104 |
|
480,600 |
|
4,372,033 |
|
— |
|
811,590 |
|
480,600 |
|
5,183,622 |
|
5,664,222 |
|
(2,419,734 |
) |
3,244,488 |
|
— |
|
|
Overlook Manor |
|
Frederick, MD |
|
1980/1985 |
|
108 |
|
1,299,100 |
|
3,930,931 |
|
— |
|
1,578,052 |
|
1,299,100 |
|
5,508,983 |
|
6,808,083 |
|
(1,937,726 |
) |
4,870,357 |
|
— |
|
|
Overlook Manor II |
|
Frederick, MD |
|
1980/1985 |
|
182 |
|
2,186,300 |
|
6,262,597 |
|
— |
|
634,872 |
|
2,186,300 |
|
6,897,469 |
|
9,083,769 |
|
(2,193,575 |
) |
6,890,194 |
|
— |
|
|
Overlook Manor III |
|
Frederick, MD |
|
1980/1985 |
|
64 |
|
1,026,300 |
|
3,027,390 |
|
— |
|
328,263 |
|
1,026,300 |
|
3,355,652 |
|
4,381,952 |
|
(1,039,663 |
) |
3,342,289 |
|
— |
|
|
Paces Station |
|
Atlanta, GA |
|
1984-1988/1989 |
|
610 |
|
4,801,500 |
|
32,548,053 |
|
— |
|
6,244,275 |
|
4,801,500 |
|
38,792,327 |
|
43,593,827 |
|
(14,162,416 |
) |
29,431,412 |
|
— |
|
|
Pacific Cove at Playa Del Rey, LLC |
|
Playa Del Ray, CA |
|
1984 |
|
80 |
|
7,550,220 |
|
20,008,783 |
|
— |
|
156,059 |
|
7,550,220 |
|
20,164,842 |
|
27,715,062 |
|
— |
|
27,715,062 |
|
— |
|
|
Palladia |
|
Hillsboro, OR |
|
2000 |
|
497 |
|
6,461,000 |
|
44,888,156 |
|
— |
|
821,855 |
|
6,461,000 |
|
45,710,011 |
|
52,171,011 |
|
(9,358,197 |
) |
42,812,813 |
|
— |
|
|
Panther Ridge |
|
Federal Way, WA |
|
1980 |
|
260 |
|
1,055,800 |
|
9,506,117 |
|
— |
|
1,308,645 |
|
1,055,800 |
|
10,814,762 |
|
11,870,562 |
|
(4,163,363 |
) |
7,707,199 |
|
— |
|
|
Paradise Pointe |
|
Dania, FL |
|
1987-90 |
|
320 |
|
1,913,414 |
|
17,417,956 |
|
— |
|
4,119,571 |
|
1,913,414 |
|
21,537,527 |
|
23,450,941 |
|
(9,471,257 |
) |
13,979,684 |
|
— |
|
|
Parc Royale |
|
Houston, TX |
|
1994 |
|
171 |
|
2,223,000 |
|
11,936,833 |
|
— |
|
1,558,738 |
|
2,223,000 |
|
13,495,570 |
|
15,718,570 |
|
(4,240,368 |
) |
11,478,202 |
|
— |
|
|
Parc Vue at Lake Buena Vista |
|
Orlando, FL |
|
2000/2002 |
|
336 |
|
11,760,000 |
|
34,526,029 |
|
— |
|
855,283 |
|
11,760,000 |
|
35,381,312 |
|
47,141,312 |
|
(2,214,447 |
) |
44,926,865 |
|
— |
|
|
Park at Turtle Run |
|
Coral Springs, FL |
|
2001 |
|
257 |
|
15,420,000 |
|
36,064,629 |
|
— |
|
115,286 |
|
15,420,000 |
|
36,179,915 |
|
51,599,915 |
|
(2,113,355 |
) |
49,486,559 |
|
— |
|
|
Park Bloomingdale
|
|
Bloomingdale, IL |
|
1989 |
|
172 |
|
2,282,317 |
|
11,550,120 |
|
— |
|
2,195,517 |
|
2,282,317 |
|
13,745,637 |
|
16,027,954 |
|
(4,107,908 |
) |
11,920,046 |
|
— |
|
|
Park Meadow |
|
Gilbert, AZ |
|
1986 |
|
224 |
|
835,217 |
|
15,120,769 |
|
— |
|
1,670,556 |
|
835,217 |
|
16,791,324 |
|
17,626,541 |
|
(5,550,735 |
) |
12,075,806 |
|
— |
|
|
Park Place (TX) |
|
Houston, TX |
|
1996 |
|
229 |
|
1,603,000 |
|
12,054,926 |
|
— |
|
914,966 |
|
1,603,000 |
|
12,969,891 |
|
14,572,891 |
|
(4,275,260 |
) |
10,297,631 |
|
— |
|
|
Park West (CA) |
|
Los Angeles, CA |
|
1987/90 |
|
444 |
|
3,033,500 |
|
27,302,383 |
|
— |
|
3,444,937 |
|
3,033,500 |
|
30,747,320 |
|
33,780,820 |
|
(12,802,928 |
) |
20,977,892 |
|
— |
|
|
Parkside |
|
Union City, CA |
|
1979 |
|
208 |
|
6,246,700 |
|
11,827,453 |
|
— |
|
2,803,628 |
|
6,246,700 |
|
14,631,081 |
|
20,877,781 |
|
(5,202,705 |
) |
15,675,076 |
|
— |
|
|
Parkview Terrace |
|
Redlands, CA |
|
1986 |
|
558 |
|
4,969,200 |
|
35,653,777 |
|
— |
|
8,070,060 |
|
4,969,200 |
|
43,723,837 |
|
48,693,037 |
|
(13,325,566 |
) |
35,367,472 |
|
— |
|
|
Parkwood (CT) |
|
East Haven, CT |
|
1975 |
|
102 |
|
531,365 |
|
3,552,064 |
|
— |
|
464,999 |
|
531,365 |
|
4,017,063 |
|
4,548,427 |
|
(966,800 |
) |
3,581,627 |
|
— |
|
|
Phillips Park |
|
Wellesley, MA |
|
1988 |
|
49 |
|
816,922 |
|
5,460,955 |
|
— |
|
551,882 |
|
816,922 |
|
6,012,837 |
|
6,829,759 |
|
(1,335,175 |
) |
5,494,584 |
|
— |
|
|
Pine Harbour |
|
Orlando, FL |
|
1991 |
|
366 |
|
1,664,300 |
|
14,970,915 |
|
— |
|
2,631,472 |
|
1,664,300 |
|
17,602,387 |
|
19,266,687 |
|
(8,332,502 |
) |
10,934,185 |
|
— |
|
|
Playa Pacifica |
|
Hermosa Beach, CA |
|
1972 |
|
285 |
|
35,100,000 |
|
33,473,822 |
|
— |
|
410,291 |
|
35,100,000 |
|
33,884,113 |
|
68,984,113 |
|
(1,887,355 |
) |
67,096,758 |
|
— |
|
|
Plum Tree |
|
Hales Corners, WI |
|
1989 |
|
332 |
|
1,996,700 |
|
20,247,195 |
|
— |
|
1,435,400 |
|
1,996,700 |
|
21,682,595 |
|
23,679,295 |
|
(7,131,242 |
) |
16,548,053 |
|
— |
|
|
Pointe at South Mountain |
|
Phoenix, AZ |
|
1988 |
|
364 |
|
2,228,800 |
|
20,059,311 |
|
— |
|
2,536,265 |
|
2,228,800 |
|
22,595,576 |
|
24,824,376 |
|
(8,111,203 |
) |
16,713,174 |
|
— |
|
|
Polos East |
|
Orlando, FL |
|
1991 |
|
308 |
|
1,386,000 |
|
19,058,620 |
|
— |
|
1,438,211 |
|
1,386,000 |
|
20,496,831 |
|
21,882,831 |
|
(6,265,330 |
) |
15,617,500 |
|
— |
|
|
Port Royale |
|
Ft. Lauderdale, FL (G) |
|
1988 |
|
252 |
|
1,754,200 |
|
15,789,873 |
|
— |
|
4,293,894 |
|
1,754,200 |
|
20,083,767 |
|
21,837,967 |
|
(8,314,371 |
) |
13,523,596 |
|
— |
|
|
Port Royale II |
|
Ft. Lauderdale, FL (G) |
|
1988 |
|
161 |
|
1,022,200 |
|
9,203,166 |
|
— |
|
2,712,635 |
|
1,022,200 |
|
11,915,801 |
|
12,938,001 |
|
(4,532,826 |
) |
8,405,175 |
|
— |
|
|
Port Royale III |
|
Ft. Lauderdale, FL (G) |
|
1988 |
|
324 |
|
7,454,900 |
|
14,725,802 |
|
— |
|
4,931,699 |
|
7,454,900 |
|
19,657,501 |
|
27,112,401 |
|
(6,749,472 |
) |
20,362,929 |
|
— |
|
|
Port Royale IV |
|
Ft. Lauderdale, FL |
|
(F) |
|
— |
|
— |
|
26,997 |
|
— |
|
— |
|
— |
|
26,997 |
|
26,997 |
|
— |
|
26,997 |
|
— |
|
|
Portofino |
|
Chino Hills, CA |
|
1989 |
|
176 |
|
3,572,400 |
|
14,660,994 |
|
— |
|
1,314,151 |
|
3,572,400 |
|
15,975,145 |
|
19,547,545 |
|
(5,206,302 |
) |
14,341,242 |
|
— |
|
|
Preakness |
|
Antioch, TN |
|
1986 |
|
260 |
|
1,561,900 |
|
7,668,521 |
|
— |
|
2,224,100 |
|
1,561,900 |
|
9,892,621 |
|
11,454,521 |
|
(3,998,297 |
) |
7,456,225 |
|
— |
|
|
Preserve at Deer Creek |
|
Deerfield Beach, FL |
|
1997 |
|
540 |
|
13,500,000 |
|
60,011,208 |
|
— |
|
691,204 |
|
13,500,000 |
|
60,702,413 |
|
74,202,413 |
|
(7,071,995 |
) |
67,130,418 |
|
— |
|
|
Prime, The |
|
Arlington, VA |
|
2002 |
|
256 |
|
32,000,000 |
|
64,449,841 |
|
— |
|
(5) |
|
32,000,000 |
|
64,449,836 |
|
96,449,836 |
|
(1,003,651 |
) |
95,446,185 |
|
— |
|
|
Promenade (FL) |
|
St. Petersburg, FL |
|
1994 |
|
334 |
|
2,124,193 |
|
25,804,037 |
|
— |
|
3,107,691 |
|
2,124,193 |
|
28,911,728 |
|
31,035,921 |
|
(8,760,171 |
) |
22,275,750 |
|
— |
|
|
Promenade at Aventura |
|
Aventura, FL |
|
1995 |
|
296 |
|
13,320,000 |
|
30,353,748 |
|
— |
|
1,529,461 |
|
13,320,000 |
|
31,883,209 |
|
45,203,209 |
|
(6,985,380 |
) |
38,217,829 |
|
— |
|
|
Promenade at Peachtree |
|
Chamblee, GA |
|
2001 |
|
406 |
|
10,150,000 |
|
31,219,739 |
|
— |
|
1,040,108 |
|
10,150,000 |
|
32,259,847 |
|
42,409,847 |
|
(3,372,922 |
) |
39,036,925 |
|
— |
|
|
Promenade at Town Center I |
|
Valencia, CA |
|
2001 |
|
294 |
|
14,700,000 |
|
35,390,279 |
|
— |
|
841,778 |
|
14,700,000 |
|
36,232,057 |
|
50,932,057 |
|
(4,382,847 |
) |
46,549,209 |
|
— |
|
|
Promenade at Wyndham Lakes |
|
Coral Springs, FL |
|
1998 |
|
332 |
|
6,640,000 |
|
26,743,760 |
|
— |
|
1,038,403 |
|
6,640,000 |
|
27,782,163 |
|
34,422,163 |
|
(6,559,185 |
) |
27,862,978 |
|
— |
|
|
Promenade Terrace |
|
Corona, CA |
|
1990 |
|
330 |
|
2,272,800 |
|
20,546,289 |
|
— |
|
3,110,625 |
|
2,272,800 |
|
23,656,915 |
|
25,929,715 |
|
(9,058,086 |
) |
16,871,628 |
|
— |
|
|
Promontory Pointe I & II |
|
Phoenix, AZ |
|
1984/1996 |
|
424 |
|
2,355,509 |
|
30,421,840 |
|
— |
|
2,899,735 |
|
2,355,509 |
|
33,321,575 |
|
35,677,084 |
|
(10,974,605 |
) |
24,702,479 |
|
— |
|
|
Prospect Towers |
|
Hackensack, NJ |
|
1995 |
|
157 |
|
3,926,600 |
|
27,966,416 |
|
— |
|
2,831,346 |
|
3,926,600 |
|
30,797,763 |
|
34,724,363 |
|
(9,993,091 |
) |
24,731,271 |
|
— |
|
|
Prospect Towers II |
|
Hackensack, NJ |
|
2002 |
|
203 |
|
4,500,000 |
|
33,104,733 |
|
— |
|
889,424 |
|
4,500,000 |
|
33,994,157 |
|
38,494,157 |
|
(5,663,287 |
) |
32,830,870 |
|
— |
|
|
Providence |
|
Bothell, WA |
|
2000 |
|
200 |
|
3,573,621 |
|
19,055,505 |
|
— |
|
266,848 |
|
3,573,621 |
|
19,322,354 |
|
22,895,975 |
|
(2,345,897 |
) |
20,550,078 |
|
— |
|
|
Ranch at Fossil Creek |
|
Haltom City, TX |
|
2003 |
|
274 |
|
1,715,435 |
|
16,829,282 |
|
— |
|
436,756 |
|
1,715,435 |
|
17,266,038 |
|
18,981,473 |
|
(2,300,557 |
) |
16,680,916 |
|
— |
|
|
Ravinia |
|
Greenfield, WI |
|
1991 |
|
206 |
|
1,240,100 |
|
12,055,713 |
|
— |
|
832,049 |
|
1,240,100 |
|
12,887,762 |
|
14,127,862 |
|
(4,265,270 |
) |
9,862,593 |
|
— |
|
|
Redlands Lawn and Tennis |
|
Redlands, CA |
|
1986 |
|
496 |
|
4,822,320 |
|
26,359,328 |
|
— |
|
3,241,300 |
|
4,822,320 |
|
29,600,629 |
|
34,422,949 |
|
(9,888,427 |
) |
24,534,522 |
|
— |
|
|
Redmond Ridge (Land) |
|
Redmond, WA |
|
(F) |
|
— |
|
6,975,705 |
|
6,671,830 |
|
— |
|
— |
|
6,975,705 |
|
6,671,830 |
|
13,647,535 |
|
— |
|
13,647,535 |
|
— |
|
|
Regency |
|
Charlotte, NC |
|
1986 |
|
178 |
|
890,000 |
|
11,783,920 |
|
— |
|
1,315,147 |
|
890,000 |
|
13,099,067 |
|
13,989,067 |
|
(3,982,637 |
) |
10,006,429 |
|
— |
|
|
Regency Palms |
|
Huntington Beach, CA |
|
1969 |
|
310 |
|
1,857,400 |
|
16,713,254 |
|
— |
|
3,079,768 |
|
1,857,400 |
|
19,793,021 |
|
21,650,421 |
|
(8,064,331 |
) |
13,586,090 |
|
— |
|
|
Regency Park |
|
Centreville, VA |
|
1989 |
|
252 |
|
2,521,500 |
|
16,200,666 |
|
— |
|
4,662,656 |
|
2,521,500 |
|
20,863,322 |
|
23,384,822 |
|
(6,371,370 |
) |
17,013,452 |
|
— |
|
|
Remington Place |
|
Phoenix, AZ |
|
1983 |
|
412 |
|
1,492,750 |
|
13,377,478 |
|
— |
|
3,470,919 |
|
1,492,750 |
|
16,848,397 |
|
18,341,147 |
|
(7,278,079 |
) |
11,063,068 |
|
— |
|
|
Reserve at Clarendon Centre, The |
|
Arlington, VA (G) |
|
2003 |
|
252 |
|
10,500,000 |
|
52,812,935 |
|
— |
|
776,698 |
|
10,500,000 |
|
53,589,633 |
|
64,089,633 |
|
(6,382,075 |
) |
57,707,558 |
|
— |
|
|
Reserve at Eisenhower, The |
|
Alexandria, VA |
|
2002 |
|
226 |
|
6,500,000 |
|
34,585,060 |
|
— |
|
174,392 |
|
6,500,000 |
|
34,759,452 |
|
41,259,452 |
|
(5,085,596 |
) |
36,173,855 |
|
— |
|
|
Reserve at Empire Lakes |
|
Rancho Cucamonga, CA |
|
2005 |
|
467 |
|
16,345,000 |
|
73,081,671 |
|
— |
|
112,194 |
|
16,345,000 |
|
73,193,864 |
|
89,538,864 |
|
(4,504,542 |
) |
85,034,322 |
|
— |
|
|
Reserve at Moreno Valley Ranch |
|
Moreno Valley, CA |
|
2005 |
|
176 |
|
8,800,000 |
|
26,151,088 |
|
— |
|
31,882 |
|
8,800,000 |
|
26,182,970 |
|
34,982,970 |
|
(1,196,124 |
) |
33,786,846 |
|
— |
|
|
Residences at Little River |
|
Haverhill, MA |
|
2003 |
|
174 |
|
6,905,138 |
|
19,172,797 |
|
— |
|
190,531 |
|
6,905,138 |
|
19,363,328 |
|
26,268,466 |
|
(2,409,000 |
) |
23,859,467 |
|
— |
|
|
Richmond Townhomes |
|
Houston, TX |
|
1995 |
|
188 |
|
940,000 |
|
13,906,905 |
|
— |
|
2,171,398 |
|
940,000 |
|
16,078,303 |
|
17,018,303 |
|
(4,589,497 |
) |
12,428,806 |
|
— |
|
|
Ridgewood Village |
|
San Diego, CA |
|
1997 |
|
192 |
|
5,761,500 |
|
14,032,511 |
|
— |
|
775,745 |
|
5,761,500 |
|
14,808,256 |
|
20,569,756 |
|
(4,598,153 |
) |
15,971,602 |
|
— |
|
|
Ridgewood Village II |
|
San Diego, CA |
|
1997 |
|
216 |
|
6,048,000 |
|
19,971,537 |
|
— |
|
136,416 |
|
6,048,000 |
|
20,107,953 |
|
26,155,953 |
|
(4,312,547 |
) |
21,843,406 |
|
— |
|
|
Rincon |
|
Houston, TX |
|
1996 |
|
288 |
|
4,401,900 |
|
16,734,746 |
|
— |
|
1,664,598 |
|
4,401,900 |
|
18,399,344 |
|
22,801,244 |
|
(6,572,590 |
) |
16,228,654 |
|
— |
|
|
River Hill |
|
Grand Prairie, TX |
|
1996 |
|
334 |
|
2,004,000 |
|
19,272,944 |
|
— |
|
1,428,146 |
|
2,004,000 |
|
20,701,090 |
|
22,705,090 |
|
(6,277,321 |
) |
16,427,769 |
|
— |
|
|
River Park |
|
Fort Worth, TX |
|
1984 |
|
280 |
|
2,245,400 |
|
8,811,727 |
|
— |
|
2,891,050 |
|
2,245,400 |
|
11,702,777 |
|
13,948,177 |
|
(4,414,847 |
) |
9,533,329 |
|
— |
|
|
River Stone Ranch |
|
Austin, TX |
|
1998 |
|
448 |
|
5,376,000 |
|
27,004,185 |
|
— |
|
1,391,746 |
|
5,376,000 |
|
28,395,931 |
|
33,771,931 |
|
(3,966,450 |
) |
29,805,481 |
|
— |
|
|
Riviera at West Village |
|
Dallas, TX |
|
1995 |
|
150 |
|
6,534,000 |
|
14,749,422 |
|
— |
|
822,128 |
|
6,534,000 |
|
15,571,550 |
|
22,105,550 |
|
(1,111,667 |
) |
20,993,883 |
|
— |
|
S-6
EQUITY RESIDENTIAL
Schedule III - Real Estate and Accumulated Depreciation
December 31, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost Capitalized |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsequent to |
|
|
|
Gross Amount Carried |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Initial Cost to |
|
|
|
Acquisition |
|
|
|
at Close of |
|
|
|
|
|
|
|
|
|
|
|
|
Description |
|
|
|
|
|
Company |
|
|
|
(Improvements, net) (E) |
|
|
|
Period 12/31/06 |
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
Date of |
|
|
|
|
|
Building & |
|
|
|
Building & |
|
|
|
Building & |
|
|
|
Accumulated |
|
Investment in Real |
|
|
|
|
Apartment Name |
|
Location |
|
Construction |
|
Units (I) |
|
Land |
|
Fixtures |
|
Land |
|
Fixtures |
|
Land |
|
Fixtures (A) |
|
Total (B) |
|
Depreciation (C) |
|
Estate, Net at 12/31/06 |
|
Encumbrances |
|
|
Rivers Edge |
|
Waterbury, CT |
|
1974 |
|
156 |
|
781,900 |
|
6,561,167 |
|
— |
|
908,573 |
|
781,900 |
|
7,469,740 |
|
8,251,640 |
|
(2,379,281 |
) |
5,872,359 |
|
— |
|
|
Rock Creek |
|
Carrboro, NC |
|
1986 |
|
188 |
|
895,700 |
|
8,062,543 |
|
— |
|
1,888,798 |
|
895,700 |
|
9,951,341 |
|
10,847,041 |
|
(3,850,036 |
) |
6,997,004 |
|
— |
|
|
Rosecliff |
|
Quincy, MA |
|
1990 |
|
156 |
|
5,460,000 |
|
15,721,570 |
|
— |
|
385,476 |
|
5,460,000 |
|
16,107,046 |
|
21,567,046 |
|
(4,164,987 |
) |
17,402,058 |
|
— |
|
|
Royal Oaks (FL) |
|
Jacksonville, FL |
|
1991 |
|
284 |
|
1,988,000 |
|
13,645,117 |
|
— |
|
2,018,719 |
|
1,988,000 |
|
15,663,836 |
|
17,651,836 |
|
(4,763,881 |
) |
12,887,955 |
|
— |
|
|
Sabal Palm at Boot Ranch |
|
Palm Harbor, FL |
|
1996 |
|
432 |
|
3,888,000 |
|
28,923,692 |
|
— |
|
2,086,359 |
|
3,888,000 |
|
31,010,050 |
|
34,898,050 |
|
(9,325,573 |
) |
25,572,477 |
|
— |
|
|
Sabal Palm at Carrollwood Place |
|
Tampa, FL |
|
1995 |
|
432 |
|
3,888,000 |
|
26,911,542 |
|
— |
|
1,475,872 |
|
3,888,000 |
|
28,387,415 |
|
32,275,415 |
|
(8,426,151 |
) |
23,849,264 |
|
— |
|
|
Sabal Palm at Lake Buena Vista |
|
Orlando, FL |
|
1988 |
|
400 |
|
2,800,000 |
|
23,687,893 |
|
— |
|
2,182,202 |
|
2,800,000 |
|
25,870,095 |
|
28,670,095 |
|
(7,872,138 |
) |
20,797,956 |
|
— |
|
|
Sabal Palm at Metrowest |
|
Orlando, FL |
|
1998 |
|
411 |
|
4,110,000 |
|
38,394,865 |
|
— |
|
2,197,274 |
|
4,110,000 |
|
40,592,138 |
|
44,702,138 |
|
(12,045,661 |
) |
32,656,477 |
|
— |
|
|
Sabal Palm at Metrowest II |
|
Orlando, FL |
|
1997 |
|
456 |
|
4,560,000 |
|
33,907,283 |
|
— |
|
1,628,540 |
|
4,560,000 |
|
35,535,823 |
|
40,095,823 |
|
(10,349,274 |
) |
29,746,549 |
|
— |
|
|
Sabal Pointe |
|
Coral Springs, FL |
|
1995 |
|
275 |
|
1,951,600 |
|
17,570,508 |
|
— |
|
2,421,872 |
|
1,951,600 |
|
19,992,380 |
|
21,943,980 |
|
(7,902,438 |
) |
14,041,542 |
|
— |
|
|
Saddle Ridge |
|
Ashburn, VA |
|
1989 |
|
216 |
|
1,364,800 |
|
12,283,616 |
|
— |
|
1,578,493 |
|
1,364,800 |
|
13,862,110 |
|
15,226,910 |
|
(5,622,464 |
) |
9,604,445 |
|
— |
|
|
Sailboat Bay |
|
Raleigh, NC |
|
1986 |
|
192 |
|
960,000 |
|
8,797,580 |
|
— |
|
1,146,582 |
|
960,000 |
|
9,944,161 |
|
10,904,161 |
|
(3,111,950 |
) |
7,792,211 |
|
— |
|
|
San Marcos |
|
Scottsdale, AZ |
|
1995 |
|
320 |
|
20,000,000 |
|
31,236,223 |
|
— |
|
11,258 |
|
20,000,000 |
|
31,247,481 |
|
51,247,481 |
|
(519,582 |
) |
50,727,899 |
|
— |
|
|
Savannah at Park Place |
|
Atlanta, GA |
|
2001 |
|
416 |
|
7,696,095 |
|
34,114,542 |
|
— |
|
1,919,334 |
|
7,696,095 |
|
36,033,876 |
|
43,729,971 |
|
(4,071,207 |
) |
39,658,764 |
|
— |
|
|
Savannah Lakes |
|
Boynton Beach, FL |
|
1991 |
|
466 |
|
7,000,000 |
|
30,422,607 |
|
— |
|
1,443,363 |
|
7,000,000 |
|
31,865,970 |
|
38,865,970 |
|
(6,147,882 |
) |
32,718,087 |
|
— |
|
|
Scottsdale Meadows |
|
Scottsdale, AZ |
|
1984 |
|
168 |
|
1,512,000 |
|
11,407,699 |
|
— |
|
1,138,943 |
|
1,512,000 |
|
12,546,642 |
|
14,058,642 |
|
(4,204,408 |
) |
9,854,234 |
|
— |
|
|
Seeley Lake |
|
Lakewood, WA |
|
1990 |
|
522 |
|
2,760,400 |
|
24,845,286 |
|
— |
|
2,716,246 |
|
2,760,400 |
|
27,561,533 |
|
30,321,933 |
|
(9,781,751 |
) |
20,540,182 |
|
— |
|
|
Seventh & James |
|
Seattle, WA |
|
1992 |
|
96 |
|
663,800 |
|
5,974,803 |
|
— |
|
1,980,783 |
|
663,800 |
|
7,955,586 |
|
8,619,386 |
|
(3,242,280 |
) |
5,377,107 |
|
— |
|
|
Shadow Creek |
|
Winter Springs, FL |
|
2000 |
|
280 |
|
6,000,000 |
|
21,719,768 |
|
— |
|
686,031 |
|
6,000,000 |
|
22,405,800 |
|
28,405,800 |
|
(2,528,671 |
) |
25,877,129 |
|
— |
|
|
Shadow Lake |
|
Doraville, GA |
|
1989 |
|
228 |
|
1,140,000 |
|
13,117,277 |
|
— |
|
904,999 |
|
1,140,000 |
|
14,022,276 |
|
15,162,276 |
|
(4,256,796 |
) |
10,905,480 |
|
— |
|
|
Sheffield Court |
|
Arlington, VA |
|
1986 |
|
597 |
|
3,349,350 |
|
31,337,332 |
|
— |
|
3,706,251 |
|
3,349,350 |
|
35,043,584 |
|
38,392,934 |
|
(15,153,000 |
) |
23,239,934 |
|
— |
|
|
Silver Spring |
|
Silver Spring, MD |
|
(F) |
|
— |
|
18,539,817 |
|
22,144,191 |
|
— |
|
— |
|
18,539,817 |
|
22,144,191 |
|
40,684,008 |
|
— |
|
40,684,008 |
|
— |
|
|
Silver Springs (FL) |
|
Jacksonville, FL |
|
1985 |
|
432 |
|
1,831,100 |
|
16,474,735 |
|
— |
|
4,521,158 |
|
1,831,100 |
|
20,995,893 |
|
22,826,993 |
|
(8,295,022 |
) |
14,531,971 |
|
— |
|
|
Skylark |
|
Union City, CA |
|
1986 |
|
174 |
|
1,781,600 |
|
16,731,916 |
|
— |
|
1,143,820 |
|
1,781,600 |
|
17,875,736 |
|
19,657,336 |
|
(5,425,454 |
) |
14,231,882 |
|
— |
|
|
Sommerset Place |
|
Raleigh, NC |
|
1983 |
|
144 |
|
360,000 |
|
7,800,206 |
|
— |
|
1,045,295 |
|
360,000 |
|
8,845,500 |
|
9,205,500 |
|
(2,803,374 |
) |
6,402,126 |
|
— |
|
|
Sonata at Cherry Creek |
|
Denver, CO |
|
1999 |
|
183 |
|
5,490,000 |
|
18,130,479 |
|
— |
|
693,378 |
|
5,490,000 |
|
18,823,857 |
|
24,313,857 |
|
(4,107,443 |
) |
20,206,414 |
|
— |
|
|
Sonoran |
|
Phoenix, AZ |
|
1995 |
|
429 |
|
2,361,922 |
|
31,841,724 |
|
— |
|
1,787,444 |
|
2,361,922 |
|
33,629,167 |
|
35,991,089 |
|
(10,913,107 |
) |
25,077,982 |
|
— |
|
|
South Palm Place Condominium Homes |
|
Tamarac, FL |
|
1991 |
|
99 |
|
771,120 |
|
7,019,483 |
|
— |
|
1,364,382 |
|
771,120 |
|
8,383,864 |
|
9,154,984 |
|
(2,119,831 |
) |
7,035,152 |
|
— |
|
|
Southwood |
|
Palo Alto, CA |
|
1985 |
|
99 |
|
6,936,600 |
|
14,324,069 |
|
— |
|
1,485,834 |
|
6,936,600 |
|
15,809,903 |
|
22,746,503 |
|
(5,048,516 |
) |
17,697,988 |
|
— |
|
|
Spring Hill Commons |
|
Acton, MA |
|
1973 |
|
105 |
|
1,107,436 |
|
7,402,980 |
|
— |
|
961,530 |
|
1,107,436 |
|
8,364,510 |
|
9,471,945 |
|
(1,887,933 |
) |
7,584,013 |
|
— |
|
|
Springbrook Estates |
|
Riverside, CA |
|
(F) |
|
— |
|
70,532,700 |
|
158,297 |
|
— |
|
— |
|
70,532,700 |
|
158,297 |
|
70,690,997 |
|
— |
|
70,690,997 |
|
— |
|
|
St. Andrews at Winston Park |
|
Coconut Creek, FL |
|
1997 |
|
284 |
|
5,680,000 |
|
19,812,090 |
|
— |
|
862,771 |
|
5,680,000 |
|
20,674,861 |
|
26,354,861 |
|
(4,047,253 |
) |
22,307,608 |
|
— |
|
|
Steeplechase |
|
Charlotte, NC |
|
1986 |
|
247 |
|
1,111,500 |
|
10,180,750 |
|
— |
|
1,367,405 |
|
1,111,500 |
|
11,548,155 |
|
12,659,655 |
|
(3,630,538 |
) |
9,029,117 |
|
— |
|
|
Stone Oak |
|
Houston, TX |
|
1998 |
|
318 |
|
2,502,876 |
|
17,513,496 |
|
— |
|
947,832 |
|
2,502,876 |
|
18,461,328 |
|
20,964,204 |
|
(3,364,858 |
) |
17,599,346 |
|
— |
|
|
Stonegate (CO) |
|
Broomfield, CO |
|
2003 |
|
350 |
|
8,750,000 |
|
32,998,775 |
|
— |
|
1,615,116 |
|
8,750,000 |
|
34,613,891 |
|
43,363,891 |
|
(2,333,918 |
) |
41,029,973 |
|
— |
|
|
Stoneleigh at Deerfield |
|
Alpharetta, GA |
|
2003 |
|
370 |
|
4,810,000 |
|
29,999,596 |
|
— |
|
331,831 |
|
4,810,000 |
|
30,331,427 |
|
35,141,427 |
|
(2,836,991 |
) |
32,304,435 |
|
— |
|
|
Stoney Creek |
|
Lakewood, WA |
|
1990 |
|
231 |
|
1,215,200 |
|
10,938,134 |
|
— |
|
1,594,714 |
|
1,215,200 |
|
12,532,847 |
|
13,748,047 |
|
(4,449,457 |
) |
9,298,590 |
|
— |
|
|
Sturbridge Meadows |
|
Sturbridge, MA |
|
1985 |
|
104 |
|
702,447 |
|
4,695,714 |
|
— |
|
643,591 |
|
702,447 |
|
5,339,305 |
|
6,041,752 |
|
(1,222,760 |
) |
4,818,992 |
|
— |
|
|
Summer Creek |
|
Plymouth, MN |
|
1985 |
|
72 |
|
579,600 |
|
3,815,800 |
|
— |
|
563,958 |
|
579,600 |
|
4,379,758 |
|
4,959,358 |
|
(1,528,244 |
) |
3,431,114 |
|
— |
|
|
Summer Ridge |
|
Riverside, CA |
|
1985 |
|
136 |
|
602,400 |
|
5,422,807 |
|
— |
|
1,785,972 |
|
602,400 |
|
7,208,779 |
|
7,811,179 |
|
(2,745,010 |
) |
5,066,169 |
|
— |
|
|
Summerset Village II |
|
Chatsworth, CA |
|
(F) |
|
— |
|
260,646 |
|
31,577 |
|
— |
|
— |
|
260,646 |
|
31,577 |
|
292,223 |
|
— |
|
292,223 |
|
— |
|
|
Summerwood |
|
Hayward, CA |
|
1982 |
|
162 |
|
4,866,600 |
|
6,942,743 |
|
— |
|
1,042,052 |
|
4,866,600 |
|
7,984,796 |
|
12,851,396 |
|
(2,695,431 |
) |
10,155,965 |
|
— |
|
|
Summit at Lake Union |
|
Seattle, WA |
|
1995 - 1997 |
|
150 |
|
1,424,700 |
|
12,852,461 |
|
— |
|
1,428,589 |
|
1,424,700 |
|
14,281,050 |
|
15,705,750 |
|
(5,124,417 |
) |
10,581,333 |
|
— |
|
|
Sunforest |
|
Davie, FL |
|
1989 |
|
494 |
|
10,000,000 |
|
32,124,850 |
|
— |
|
1,747,157 |
|
10,000,000 |
|
33,872,006 |
|
43,872,006 |
|
(4,706,870 |
) |
39,165,137 |
|
— |
|
|
Surrey Downs |
|
Bellevue, WA |
|
1986 |
|
122 |
|
3,057,100 |
|
7,848,618 |
|
— |
|
793,762 |
|
3,057,100 |
|
8,642,380 |
|
11,699,480 |
|
(2,799,920 |
) |
8,899,560 |
|
— |
|
|
Sycamore Creek |
|
Scottsdale, AZ |
|
1984 |
|
350 |
|
3,152,000 |
|
19,083,727 |
|
— |
|
2,197,744 |
|
3,152,000 |
|
21,281,471 |
|
24,433,471 |
|
(7,389,141 |
) |
17,044,330 |
|
— |
|
|
Tamarlane |
|
Portland, ME |
|
1986 |
|
115 |
|
690,900 |
|
5,153,633 |
|
— |
|
603,641 |
|
690,900 |
|
5,757,274 |
|
6,448,174 |
|
(2,078,515 |
) |
4,369,659 |
|
— |
|
|
Timber Hollow |
|
Chapel Hill, NC |
|
1986 |
|
198 |
|
800,000 |
|
11,219,537 |
|
— |
|
1,475,045 |
|
800,000 |
|
12,694,581 |
|
13,494,581 |
|
(3,902,869 |
) |
9,591,712 |
|
— |
|
|
Timber Ridge, LLC |
|
Woodinville, WA |
|
1986 |
|
4 |
|
28,629 |
|
265,181 |
|
— |
|
(64,057 |
) |
28,629 |
|
201,125 |
|
229,754 |
|
(115,062 |
) |
114,691 |
|
— |
|
|
Timberwalk |
|
Jacksonville, FL |
|
1987 |
|
284 |
|
1,988,000 |
|
13,204,219 |
|
— |
|
1,415,041 |
|
1,988,000 |
|
14,619,259 |
|
16,607,259 |
|
(4,641,908 |
) |
11,965,351 |
|
— |
|
|
Tortuga Bay |
|
Orlando, FL |
|
2004 |
|
314 |
|
6,280,000 |
|
32,121,779 |
|
— |
|
416,449 |
|
6,280,000 |
|
32,538,228 |
|
38,818,228 |
|
(2,723,427 |
) |
36,094,801 |
|
— |
|
|
Toscana |
|
Irvine, CA |
|
1991/1993 |
|
563 |
|
39,410,000 |
|
50,806,072 |
|
— |
|
3,776,758 |
|
39,410,000 |
|
54,582,831 |
|
93,992,831 |
|
(12,480,800 |
) |
81,512,030 |
|
— |
|
|
Town Center (TX) |
|
Kingwood, TX |
|
1994 |
|
258 |
|
1,291,300 |
|
11,530,216 |
|
— |
|
1,992,505 |
|
1,291,300 |
|
13,522,721 |
|
14,814,021 |
|
(4,873,105 |
) |
9,940,917 |
|
— |
|
|
Town Center II (TX) |
|
Kingwood, TX |
|
1994 |
|
260 |
|
1,375,000 |
|
14,169,656 |
|
— |
|
92,683 |
|
1,375,000 |
|
14,262,339 |
|
15,637,339 |
|
(3,604,908 |
) |
12,032,431 |
|
— |
|
|
Townes at Herndon |
|
Herndon, VA |
|
2002 |
|
218 |
|
10,900,000 |
|
49,216,125 |
|
— |
|
22,214 |
|
10,900,000 |
|
49,238,339 |
|
60,138,339 |
|
(1,574,437 |
) |
58,563,902 |
|
— |
|
|
Tradition at Alafaya |
|
Oviedo, FL |
|
2006 |
|
253 |
|
7,590,000 |
|
32,014,299 |
|
— |
|
(117 |
) |
7,590,000 |
|
32,014,182 |
|
39,604,182 |
|
(1,010,541 |
) |
38,593,642 |
|
— |
|
|
Trails at Dominion Park |
|
Houston, TX |
|
1992 |
|
843 |
|
2,531,800 |
|
35,699,589 |
|
— |
|
5,248,612 |
|
2,531,800 |
|
40,948,201 |
|
43,480,001 |
|
(15,291,501 |
) |
28,188,500 |
|
— |
|
|
Trump Place, 140 Riverside |
|
New York, NY (G) |
|
2003 |
|
354 |
|
103,539,100 |
|
94,082,057 |
|
— |
|
122,980 |
|
103,539,100 |
|
94,205,037 |
|
197,744,137 |
|
(5,953,348 |
) |
191,790,789 |
|
— |
|
|
Trump Place, 160 Riverside |
|
New York, NY (G) |
|
2001 |
|
455 |
|
139,933,500 |
|
190,963,887 |
|
— |
|
469,688 |
|
139,933,500 |
|
191,433,575 |
|
331,367,075 |
|
(10,922,967 |
) |
320,444,108 |
|
— |
|
|
Trump Place, 180 Riverside |
|
New York, NY (G) |
|
1998 |
|
516 |
|
144,968,250 |
|
138,345,708 |
|
— |
|
1,546,310 |
|
144,968,250 |
|
139,892,018 |
|
284,860,268 |
|
(8,557,076 |
) |
276,303,193 |
|
— |
|
|
Turnberry Isle |
|
Dallas, TX |
|
1994 |
|
187 |
|
2,992,000 |
|
15,287,285 |
|
— |
|
584,990 |
|
2,992,000 |
|
15,872,275 |
|
18,864,275 |
|
(1,582,010 |
) |
17,282,266 |
|
— |
|
|
Tuscany at Lindbergh |
|
Atlanta, GA |
|
2001 |
|
324 |
|
9,720,000 |
|
40,874,023 |
|
— |
|
641,135 |
|
9,720,000 |
|
41,515,158 |
|
51,235,158 |
|
(2,500,579 |
) |
48,734,580 |
|
— |
|
|
Tyrone Gardens |
|
Randolph, MA |
|
1961/1965 |
|
165 |
|
4,953,000 |
|
5,799,572 |
|
— |
|
1,414,338 |
|
4,953,000 |
|
7,213,910 |
|
12,166,910 |
|
(2,456,900 |
) |
9,710,010 |
|
— |
|
|
Uptown Square |
|
Denver, CO (G) |
|
1999/2001 |
|
696 |
|
17,492,000 |
|
100,697,530 |
|
— |
|
321,993 |
|
17,492,000 |
|
101,019,523 |
|
118,511,523 |
|
(3,250,099 |
) |
115,261,423 |
|
— |
|
|
Valencia Plantation |
|
Orlando, FL |
|
1990 |
|
194 |
|
873,000 |
|
12,819,377 |
|
— |
|
935,834 |
|
873,000 |
|
13,755,211 |
|
14,628,211 |
|
(4,008,336 |
) |
10,619,875 |
|
— |
|
|
Versailles |
|
Woodland Hills, CA |
|
1991 |
|
253 |
|
12,650,000 |
|
33,656,292 |
|
— |
|
2,335,009 |
|
12,650,000 |
|
35,991,301 |
|
48,641,301 |
|
(4,672,266 |
) |
43,969,035 |
|
— |
|
|
Via Ventura |
|
Scottsdale, AZ |
|
1980 |
|
328 |
|
1,486,600 |
|
13,382,006 |
|
— |
|
6,976,055 |
|
1,486,600 |
|
20,358,061 |
|
21,844,661 |
|
(11,540,954 |
) |
10,303,707 |
|
— |
|
|
View Pointe |
|
Riverside, CA |
|
1998 |
|
208 |
|
10,400,000 |
|
26,315,150 |
|
— |
|
630,958 |
|
10,400,000 |
|
26,946,108 |
|
37,346,108 |
|
(1,569,338 |
) |
35,776,770 |
|
— |
|
|
Villa Solana |
|
Laguna Hills, CA |
|
1984 |
|
272 |
|
1,665,100 |
|
14,985,678 |
|
— |
|
3,690,234 |
|
1,665,100 |
|
18,675,911 |
|
20,341,011 |
|
(8,999,716 |
) |
11,341,295 |
|
— |
|
|
Village at Lakewood |
|
Phoenix, AZ |
|
1988 |
|
240 |
|
3,166,411 |
|
13,859,090 |
|
— |
|
1,476,850 |
|
3,166,411 |
|
15,335,940 |
|
18,502,351 |
|
(5,322,569 |
) |
13,179,782 |
|
— |
|
|
Village Oaks |
|
Austin, TX |
|
1984 |
|
280 |
|
1,186,000 |
|
10,663,736 |
|
— |
|
2,882,522 |
|
1,186,000 |
|
13,546,258 |
|
14,732,258 |
|
(4,953,970 |
) |
9,778,287 |
|
— |
|
|
Village of Newport |
|
Kent, WA |
|
1987 |
|
100 |
|
416,300 |
|
3,756,582 |
|
— |
|
621,623 |
|
416,300 |
|
4,378,205 |
|
4,794,505 |
|
(2,054,658 |
) |
2,739,847 |
|
— |
|
|
Virgil Square |
|
Los Angeles, CA |
|
1979 |
|
142 |
|
5,500,000 |
|
15,216,210 |
|
— |
|
381,952 |
|
5,500,000 |
|
15,598,162 |
|
21,098,162 |
|
(1,165,569 |
) |
19,932,594 |
|
— |
|
|
Vista Del Lago |
|
Mission Viejo, CA |
|
1986-88 |
|
608 |
|
4,525,800 |
|
40,736,293 |
|
— |
|
7,454,025 |
|
4,525,800 |
|
48,190,319 |
|
52,716,119 |
|
(21,970,822 |
) |
30,745,296 |
|
— |
|
|
Vista Grove |
|
Mesa, AZ |
|
1997 - 1998 |
|
224 |
|
1,341,796 |
|
12,157,045 |
|
— |
|
925,655 |
|
1,341,796 |
|
13,082,700 |
|
14,424,496 |
|
(4,168,626 |
) |
10,255,871 |
|
— |
|
|
Vista Montana - Residential |
|
San Jose, CA |
|
(F) |
|
— |
|
— |
|
1,225,533 |
|
— |
|
— |
|
— |
|
1,225,533 |
|
1,225,533 |
|
— |
|
1,225,533 |
|
— |
|
|
Vista Montana - Condo |
|
San Jose, CA |
|
(F) |
|
— |
|
— |
|
439,553 |
|
— |
|
— |
|
— |
|
439,553 |
|
439,553 |
|
— |
|
439,553 |
|
— |
|
|
Waterford (Jax) II |
|
Jacksonville, FL |
|
(F) |
|
— |
|
566,923 |
|
62,373 |
|
— |
|
— |
|
566,923 |
|
62,373 |
|
629,296 |
|
— |
|
629,296 |
|
— |
|
|
Waterford at Deerwood |
|
Jacksonville, FL |
|
1985 |
|
248 |
|
1,696,000 |
|
10,659,702 |
|
— |
|
2,068,695 |
|
1,696,000 |
|
12,728,397 |
|
14,424,397 |
|
(4,193,484 |
) |
10,230,913 |
|
— |
|
|
Waterford Place (CO) |
|
Thornton, CO |
|
1998 |
|
336 |
|
5,040,000 |
|
29,733,022 |
|
— |
|
662,702 |
|
5,040,000 |
|
30,395,724 |
|
35,435,724 |
|
(2,289,513 |
) |
33,146,212 |
|
— |
|
|
Waterside |
|
Reston, VA |
|
1984 |
|
276 |
|
20,700,000 |
|
27,474,388 |
|
— |
|
796,855 |
|
20,700,000 |
|
28,271,242 |
|
48,971,242 |
|
(1,938,567 |
) |
47,032,675 |
|
— |
|
|
Webster Green |
|
Needham, MA |
|
1985 |
|
77 |
|
1,418,893 |
|
9,485,006 |
|
— |
|
457,298 |
|
1,418,893 |
|
9,942,304 |
|
11,361,197 |
|
(2,226,316 |
) |
9,134,881 |
|
— |
|
|
Welleby Lake Club |
|
Sunrise, FL |
|
1991 |
|
304 |
|
3,648,000 |
|
17,620,879 |
|
— |
|
1,583,390 |
|
3,648,000 |
|
19,204,270 |
|
22,852,270 |
|
(5,886,183 |
) |
16,966,086 |
|
— |
|
|
Westfield Village |
|
Centerville, VA |
|
1988 |
|
228 |
|
7,000,000 |
|
23,245,834 |
|
— |
|
3,765,784 |
|
7,000,000 |
|
27,011,618 |
|
34,011,618 |
|
(2,873,291 |
) |
31,138,327 |
|
— |
|
|
Westridge |
|
Tacoma, WA |
|
1987/1991 |
|
714 |
|
3,501,900 |
|
31,506,082 |
|
— |
|
3,983,305 |
|
3,501,900 |
|
35,489,387 |
|
38,991,287 |
|
(12,958,546 |
) |
26,032,741 |
|
— |
|
|
Westside Villas I |
|
Los Angeles, CA |
|
1999 |
|
21 |
|
1,785,000 |
|
3,233,254 |
|
— |
|
193,400 |
|
1,785,000 |
|
3,426,654 |
|
5,211,654 |
|
(822,173 |
) |
4,389,482 |
|
— |
|
|
Westside Villas II |
|
Los Angeles, CA |
|
1999 |
|
23 |
|
1,955,000 |
|
3,541,435 |
|
— |
|
50,148 |
|
1,955,000 |
|
3,591,583 |
|
5,546,583 |
|
(781,098 |
) |
4,765,486 |
|
— |
|
|
Westside Villas III |
|
Los Angeles, CA |
|
1999 |
|
36 |
|
3,060,000 |
|
5,538,871 |
|
— |
|
98,852 |
|
3,060,000 |
|
5,637,723 |
|
8,697,723 |
|
(1,233,642 |
) |
7,464,081 |
|
— |
|
|
Westside Villas IV |
|
Los Angeles, CA |
|
1999 |
|
36 |
|
3,060,000 |
|
5,539,390 |
|
— |
|
84,742 |
|
3,060,000 |
|
5,624,133 |
|
8,684,133 |
|
(1,220,045 |
) |
7,464,088 |
|
— |
|
|
Westside Villas V |
|
Los Angeles, CA |
|
1999 |
|
60 |
|
5,100,000 |
|
9,224,485 |
|
— |
|
143,070 |
|
5,100,000 |
|
9,367,556 |
|
14,467,556 |
|
(2,038,121 |
) |
12,429,434 |
|
— |
|
|
Westside Villas VI |
|
Los Angeles, CA |
|
1989 |
|
18 |
|
1,530,000 |
|
3,023,523 |
|
— |
|
146,993 |
|
1,530,000 |
|
3,170,515 |
|
4,700,515 |
|
(694,718 |
) |
4,005,797 |
|
— |
|
|
Westside Villas VII |
|
Los Angeles, CA |
|
2001 |
|
53 |
|
4,505,000 |
|
10,758,900 |
|
— |
|
141,444 |
|
4,505,000 |
|
10,900,343 |
|
15,405,343 |
|
(1,786,865 |
) |
13,618,479 |
|
— |
|
|
Whispering Oaks |
|
Walnut Creek, CA |
|
1974 |
|
316 |
|
2,170,800 |
|
19,539,586 |
|
— |
|
3,246,477 |
|
2,170,800 |
|
22,786,063 |
|
24,956,863 |
|
(8,857,885 |
) |
16,098,977 |
|
— |
|
|
Willow Trail |
|
Norcross, GA |
|
1985 |
|
224 |
|
1,120,000 |
|
11,412,982 |
|
— |
|
1,027,009 |
|
1,120,000 |
|
12,439,990 |
|
13,559,990 |
|
(3,850,958 |
) |
9,709,033 |
|
— |
|
S-7
EQUITY RESIDENTIAL
Schedule III - Real Estate and Accumulated Depreciation
December 31, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost Capitalized |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsequent to |
|
|
|
Gross Amount Carried |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Initial Cost to |
|
|
|
Acquisition |
|
|
|
at Close of |
|
|
|
|
|
|
|
|
|
|
|
|
Description |
|
|
|
|
|
Company |
|
|
|
(Improvements, net) (E) |
|
|
|
Period 12/31/06 |
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
Date of |
|
|
|
|
|
Building & |
|
|
|
Building & |
|
|
|
Building & |
|
|
|
Accumulated |
|
Investment in Real |
|
|
|
|
Apartment Name |
|
Location |
|
Construction |
|
Units (I) |
|
Land |
|
Fixtures |
|
Land |
|
Fixtures |
|
Land |
|
Fixtures (A) |
|
Total (B) |
|
Depreciation (C) |
|
Estate, Net at 12/31/06 |
|
Encumbrances |
|
|
Wimberly |
|
Dallas, TX |
|
1996 |
|
372 |
|
2,232,000 |
|
27,685,923 |
|
— |
|
1,445,913 |
|
2,232,000 |
|
29,131,836 |
|
31,363,836 |
|
(8,636,474 |
) |
22,727,362 |
|
— |
|
|
Wimberly at Deerwood |
|
Jacksonville, FL |
|
2000 |
|
322 |
|
8,000,000 |
|
30,057,214 |
|
— |
|
807,195 |
|
8,000,000 |
|
30,864,410 |
|
38,864,410 |
|
(1,878,829 |
) |
36,985,581 |
|
— |
|
|
Wimbledon Oaks |
|
Arlington, TX |
|
1985 |
|
248 |
|
1,491,700 |
|
8,843,716 |
|
— |
|
2,200,545 |
|
1,491,700 |
|
11,044,261 |
|
12,535,961 |
|
(3,615,907 |
) |
8,920,054 |
|
— |
|
|
Winchester Park |
|
Riverside, RI |
|
1972 |
|
416 |
|
2,822,618 |
|
18,868,626 |
|
— |
|
3,031,769 |
|
2,822,618 |
|
21,900,395 |
|
24,723,013 |
|
(5,883,598 |
) |
18,839,415 |
|
— |
|
|
Winchester Wood |
|
Riverside, RI |
|
1989 |
|
62 |
|
683,215 |
|
4,567,154 |
|
— |
|
436,297 |
|
683,215 |
|
5,003,451 |
|
5,686,666 |
|
(1,098,276 |
) |
4,588,391 |
|
— |
|
|
Windemere |
|
Mesa, AZ |
|
1986 |
|
224 |
|
940,450 |
|
8,659,280 |
|
— |
|
1,948,232 |
|
940,450 |
|
10,607,512 |
|
11,547,962 |
|
(4,190,260 |
) |
7,357,702 |
|
— |
|
|
Windmont |
|
Atlanta, GA |
|
1988 |
|
178 |
|
3,204,000 |
|
7,128,448 |
|
— |
|
783,453 |
|
3,204,000 |
|
7,911,901 |
|
11,115,901 |
|
(2,139,825 |
) |
8,976,076 |
|
— |
|
|
Windsor at Fair Lakes |
|
Fairfax, VA |
|
1988 |
|
250 |
|
10,000,000 |
|
28,587,109 |
|
— |
|
3,820,070 |
|
10,000,000 |
|
32,407,178 |
|
42,407,178 |
|
(3,280,409 |
) |
39,126,769 |
|
— |
|
|
Winterwood |
|
Charlotte, NC |
|
1986 |
|
384 |
|
1,722,000 |
|
15,501,142 |
|
— |
|
3,767,520 |
|
1,722,000 |
|
19,268,662 |
|
20,990,662 |
|
(9,406,175 |
) |
11,584,487 |
|
— |
|
|
Wood Creek (CA) |
|
Pleasant Hill, CA |
|
1987 |
|
256 |
|
9,729,900 |
|
23,009,768 |
|
— |
|
1,711,007 |
|
9,729,900 |
|
24,720,775 |
|
34,450,675 |
|
(8,542,210 |
) |
25,908,465 |
|
— |
|
|
Woodbridge II |
|
Cary, GA |
|
1993-95 |
|
216 |
|
1,244,600 |
|
11,243,364 |
|
— |
|
1,546,563 |
|
1,244,600 |
|
12,789,927 |
|
14,034,527 |
|
(4,862,665 |
) |
9,171,862 |
|
— |
|
|
Woodland Hills |
|
Decatur, GA |
|
1985 |
|
228 |
|
1,224,600 |
|
11,010,681 |
|
— |
|
2,314,167 |
|
1,224,600 |
|
13,324,848 |
|
14,549,448 |
|
(5,522,032 |
) |
9,027,416 |
|
— |
|
|
Woodlands of Brookfield |
|
Brookfield, WI |
|
1990 |
|
148 |
|
1,484,600 |
|
13,961,081 |
|
— |
|
1,157,041 |
|
1,484,600 |
|
15,118,122 |
|
16,602,722 |
|
(4,884,796 |
) |
11,717,926 |
|
— |
|
|
Woodmoor |
|
Austin, TX |
|
1981 |
|
208 |
|
653,800 |
|
5,875,968 |
|
— |
|
2,398,443 |
|
653,800 |
|
8,274,412 |
|
8,928,212 |
|
(4,290,687 |
) |
4,637,525 |
|
— |
|
|
Woodside |
|
Lorton, VA |
|
1987 |
|
252 |
|
1,326,000 |
|
12,510,903 |
|
— |
|
4,816,061 |
|
1,326,000 |
|
17,326,963 |
|
18,652,963 |
|
(6,745,922 |
) |
11,907,041 |
|
— |
|
|
Yarmouth Woods |
|
Yarmouth, ME |
|
1971/1978 |
|
138 |
|
692,800 |
|
6,096,155 |
|
— |
|
1,290,437 |
|
692,800 |
|
7,386,592 |
|
8,079,392 |
|
(2,497,078 |
) |
5,582,314 |
|
— |
|
|
Management Business |
|
Chicago, IL |
|
(D) |
|
— |
|
— |
|
— |
|
— |
|
69,475,276 |
|
— |
|
69,475,276 |
|
69,475,276 |
|
(31,833,061 |
) |
37,642,215 |
|
— |
|
|
Operating Partnership |
|
Chicago, IL |
|
(F) |
|
— |
|
— |
|
491,595 |
|
— |
|
— |
|
— |
|
491,595 |
|
491,595 |
|
— |
|
491,595 |
|
— |
|
|
EQR Wholly Owned Unencumbered |
|
|
|
|
|
97,902 |
|
2,480,114,318 |
|
8,218,412,694 |
|
— |
|
755,163,632 |
|
2,480,114,318 |
|
8,973,576,325 |
|
11,453,690,644 |
|
(2,006,699,313 |
) |
9,446,991,331 |
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EQR Wholly Owned Encumbered: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1660 Peachtree |
|
Atlanta, GA |
|
1999 |
|
355 |
|
7,987,511 |
|
23,602,563 |
|
— |
|
2,052,728 |
|
7,987,511 |
|
25,655,291 |
|
33,642,802 |
|
(2,969,665 |
) |
30,673,137 |
|
23,000,000 |
|
|
2400 M St |
|
Washington, D.C. (G) |
|
2006 |
|
359 |
|
30,006,593 |
|
114,138,624 |
|
— |
|
85,766 |
|
30,006,593 |
|
114,224,390 |
|
144,230,983 |
|
(3,205,390 |
) |
141,025,593 |
|
75,936,000 |
|
|
2nd & 85th St |
|
New York, NY |
|
(F) |
|
— |
|
15,601,092 |
|
9,944,601 |
|
— |
|
— |
|
15,601,092 |
|
9,944,601 |
|
25,545,693 |
|
— |
|
25,545,693 |
|
15,566,275 |
|
|
740 River Drive |
|
St. Paul, MN |
|
1962 |
|
163 |
|
1,626,700 |
|
11,234,943 |
|
— |
|
3,347,310 |
|
1,626,700 |
|
14,582,252 |
|
16,208,952 |
|
(5,642,838 |
) |
10,566,114 |
|
5,077,662 |
|
|
929 House |
|
Cambridge, MA (G) |
|
1975 |
|
127 |
|
3,252,993 |
|
21,745,595 |
|
— |
|
1,673,535 |
|
3,252,993 |
|
23,419,130 |
|
26,672,123 |
|
(5,226,889 |
) |
21,445,234 |
|
4,035,104 |
|
|
Academy Village |
|
North Hollywood, CA |
|
1989 |
|
248 |
|
25,000,000 |
|
23,593,194 |
|
— |
|
1,184,661 |
|
25,000,000 |
|
24,777,855 |
|
49,777,855 |
|
(1,952,440 |
) |
47,825,415 |
|
20,000,000 |
|
|
Agliano |
|
Tampa, FL |
|
(F) |
|
— |
|
8,424,662 |
|
4,797,568 |
|
— |
|
— |
|
8,424,662 |
|
4,797,568 |
|
13,222,229 |
|
— |
|
13,222,229 |
|
6,099,616 |
|
|
Alta Pacific |
|
Irvine, CA |
|
(F) |
|
— |
|
10,752,145 |
|
11,037,426 |
|
— |
|
— |
|
10,752,145 |
|
11,037,426 |
|
21,789,570 |
|
— |
|
21,789,570 |
|
28,260,000 |
|
|
Amberton |
|
Manassas, VA |
|
1986 |
|
190 |
|
900,600 |
|
11,921,815 |
|
— |
|
1,959,704 |
|
900,600 |
|
13,881,519 |
|
14,782,119 |
|
(4,963,171 |
) |
9,818,948 |
|
10,705,000 |
|
|
Arbor Terrace |
|
Sunnyvale, CA |
|
1979 |
|
174 |
|
9,057,300 |
|
18,483,642 |
|
— |
|
1,590,781 |
|
9,057,300 |
|
20,074,423 |
|
29,131,723 |
|
(6,001,316 |
) |
23,130,407 |
|
(O |
) |
|
Arboretum (MA) |
|
Canton, MA |
|
1989 |
|
156 |
|
4,685,900 |
|
10,992,751 |
|
— |
|
1,178,505 |
|
4,685,900 |
|
12,171,256 |
|
16,857,156 |
|
(3,896,064 |
) |
12,961,092 |
|
(L |
) |
|
Arboretum at Stonelake |
|
Austin, TX |
|
1996 |
|
408 |
|
6,120,000 |
|
24,069,023 |
|
— |
|
1,657,170 |
|
6,120,000 |
|
25,726,193 |
|
31,846,193 |
|
(3,600,313 |
) |
28,245,880 |
|
14,970,000 |
|
|
Arbors of Hickory Hollow |
|
Antioch, TN |
|
1986 |
|
336 |
|
202,985 |
|
6,936,761 |
|
— |
|
3,529,757 |
|
202,985 |
|
10,466,517 |
|
10,669,502 |
|
(5,870,130 |
) |
4,799,372 |
|
(K |
) |
|
Arden Villas |
|
Orlando, FL |
|
1999 |
|
336 |
|
5,500,000 |
|
28,600,796 |
|
— |
|
2,089,931 |
|
5,500,000 |
|
30,690,727 |
|
36,190,727 |
|
(2,094,908 |
) |
34,095,819 |
|
23,247,561 |
|
|
Artisan Square |
|
Northridge, CA |
|
2002 |
|
140 |
|
7,000,000 |
|
20,537,359 |
|
— |
|
292,700 |
|
7,000,000 |
|
20,830,060 |
|
27,830,060 |
|
(3,133,707 |
) |
24,696,353 |
|
(Q |
) |
|
Autumn River |
|
Raleigh, NC |
|
2002 |
|
284 |
|
3,408,000 |
|
20,890,457 |
|
— |
|
513,753 |
|
3,408,000 |
|
21,404,210 |
|
24,812,210 |
|
(2,650,683 |
) |
22,161,527 |
|
(Q |
) |
|
Avon Place |
|
Avon, CT |
|
1973 |
|
163 |
|
1,788,943 |
|
12,440,003 |
|
— |
|
811,291 |
|
1,788,943 |
|
13,251,294 |
|
15,040,237 |
|
(2,988,280 |
) |
12,051,958 |
|
(M |
) |
|
Bay Hill |
|
Long Beach, CA |
|
2002 |
|
160 |
|
7,600,000 |
|
27,437,239 |
|
— |
|
153,455 |
|
7,600,000 |
|
27,590,694 |
|
35,190,694 |
|
(2,912,115 |
) |
32,278,579 |
|
13,996,000 |
|
|
Bradford Apartments |
|
Newington, CT |
|
1964 |
|
64 |
|
401,091 |
|
2,681,210 |
|
— |
|
334,347 |
|
401,091 |
|
3,015,557 |
|
3,416,648 |
|
(734,598 |
) |
2,682,049 |
|
(M |
) |
|
Bradley Park |
|
Puyallup, WA |
|
1999 |
|
155 |
|
3,813,000 |
|
18,313,645 |
|
— |
|
81,765 |
|
3,813,000 |
|
18,395,410 |
|
22,208,410 |
|
(1,103,632 |
) |
21,104,778 |
|
12,443,749 |
|
|
Briar Knoll Apts |
|
Vernon, CT |
|
1986 |
|
150 |
|
928,972 |
|
6,209,988 |
|
— |
|
815,944 |
|
928,972 |
|
7,025,932 |
|
7,954,904 |
|
(1,704,439 |
) |
6,250,465 |
|
5,587,997 |
|
|
Briarwood (CA) |
|
Sunnyvale, CA |
|
1985 |
|
192 |
|
9,991,500 |
|
22,247,278 |
|
— |
|
934,943 |
|
9,991,500 |
|
23,182,221 |
|
33,173,721 |
|
(6,824,575 |
) |
26,349,146 |
|
12,800,000 |
|
|
Brookdale Village |
|
Naperville, IL |
|
1986 |
|
252 |
|
3,276,000 |
|
16,293,023 |
|
— |
|
1,890,027 |
|
3,276,000 |
|
18,183,050 |
|
21,459,050 |
|
(5,259,890 |
) |
16,199,160 |
|
10,820,000 |
|
|
Brookside (MD) |
|
Frederick, MD |
|
1993 |
|
228 |
|
2,736,000 |
|
7,934,069 |
|
— |
|
1,505,337 |
|
2,736,000 |
|
9,439,406 |
|
12,175,406 |
|
(2,949,476 |
) |
9,225,930 |
|
8,170,000 |
|
|
Brooksyde Apts |
|
West Hartford, CT |
|
1945 |
|
80 |
|
594,711 |
|
3,975,523 |
|
— |
|
462,828 |
|
594,711 |
|
4,438,351 |
|
5,033,062 |
|
(1,078,479 |
) |
3,954,583 |
|
(M |
) |
|
Burgundy Studios |
|
Middletown, CT |
|
1973 |
|
102 |
|
395,238 |
|
2,642,087 |
|
— |
|
305,181 |
|
395,238 |
|
2,947,268 |
|
3,342,506 |
|
(766,460 |
) |
2,576,046 |
|
(M |
) |
|
Canterbury |
|
Germantown, MD |
|
1986 |
|
544 |
|
2,781,300 |
|
32,942,531 |
|
— |
|
9,622,847 |
|
2,781,300 |
|
42,565,377 |
|
45,346,677 |
|
(14,717,022 |
) |
30,629,655 |
|
31,680,000 |
|
|
Carlyle |
|
Dallas, TX |
|
1993 |
|
180 |
|
1,890,000 |
|
14,155,000 |
|
— |
|
757,963 |
|
1,890,000 |
|
14,912,963 |
|
16,802,963 |
|
(2,121,562 |
) |
14,681,401 |
|
7,985,386 |
|
|
Cedar Glen |
|
Reading, MA |
|
1980 |
|
114 |
|
1,248,505 |
|
8,346,003 |
|
— |
|
870,999 |
|
1,248,505 |
|
9,217,002 |
|
10,465,507 |
|
(2,093,019 |
) |
8,372,489 |
|
1,330,414 |
|
|
Centennial Court |
|
Seattle, WA (G) |
|
2001 |
|
187 |
|
3,800,000 |
|
21,280,039 |
|
— |
|
147,078 |
|
3,800,000 |
|
21,427,117 |
|
25,227,117 |
|
(1,768,802 |
) |
23,458,314 |
|
17,671,302 |
|
|
Centennial Tower |
|
Seattle, WA (G) |
|
1991 |
|
221 |
|
5,900,000 |
|
48,800,339 |
|
— |
|
727,028 |
|
5,900,000 |
|
49,527,368 |
|
55,427,368 |
|
(3,858,363 |
) |
51,569,004 |
|
27,893,694 |
|
|
Cherry Creek I,II,&III (TN) |
|
Hermitage, TN |
|
1986/96 |
|
627 |
|
2,942,345 |
|
45,725,245 |
|
— |
|
2,595,966 |
|
2,942,345 |
|
48,321,211 |
|
51,263,556 |
|
(13,377,168 |
) |
37,886,388 |
|
16,892,453 |
|
|
Chestnut Glen |
|
Abington, MA |
|
1983 |
|
130 |
|
1,178,965 |
|
7,881,139 |
|
— |
|
616,872 |
|
1,178,965 |
|
8,498,011 |
|
9,676,976 |
|
(1,988,090 |
) |
7,688,887 |
|
3,607,045 |
|
|
Chickasaw Crossing |
|
Orlando, FL |
|
1986 |
|
292 |
|
2,044,000 |
|
12,366,832 |
|
— |
|
1,201,286 |
|
2,044,000 |
|
13,568,119 |
|
15,612,119 |
|
(4,232,373 |
) |
11,379,746 |
|
11,648,914 |
|
|
Church Corner |
|
Cambridge, MA (G) |
|
1987 |
|
85 |
|
5,220,000 |
|
16,744,643 |
|
— |
|
106,905 |
|
5,220,000 |
|
16,851,548 |
|
22,071,548 |
|
(1,554,793 |
) |
20,516,755 |
|
12,000,000 |
|
|
Cierra Crest |
|
Denver, CO |
|
1996 |
|
480 |
|
4,803,100 |
|
34,894,898 |
|
— |
|
2,171,147 |
|
4,803,100 |
|
37,066,044 |
|
41,869,144 |
|
(12,039,922 |
) |
29,829,222 |
|
(O |
) |
|
City Lofts |
|
Chicago, IL |
|
(F) |
|
— |
|
5,946,369 |
|
7,902,033 |
|
— |
|
— |
|
5,946,369 |
|
7,902,033 |
|
13,848,402 |
|
— |
|
13,848,402 |
|
(J |
) |
|
Club at Tanasbourne |
|
Hillsboro, OR |
|
1990 |
|
352 |
|
3,521,300 |
|
16,257,934 |
|
— |
|
2,560,552 |
|
3,521,300 |
|
18,818,487 |
|
22,339,787 |
|
(6,914,209 |
) |
15,425,578 |
|
(N |
) |
|
Coachlight Village |
|
Agawam, MA |
|
1967 |
|
88 |
|
501,726 |
|
3,353,933 |
|
— |
|
286,900 |
|
501,726 |
|
3,640,833 |
|
4,142,558 |
|
(878,731 |
) |
3,263,827 |
|
(M |
) |
|
Colonial Village |
|
Plainville, CT |
|
1968 |
|
104 |
|
693,575 |
|
4,636,410 |
|
— |
|
697,434 |
|
693,575 |
|
5,333,844 |
|
6,027,419 |
|
(1,303,637 |
) |
4,723,782 |
|
(M |
) |
|
Conway Court |
|
Roslindale, MA |
|
1920 |
|
28 |
|
101,451 |
|
710,524 |
|
— |
|
148,476 |
|
101,451 |
|
858,999 |
|
960,450 |
|
(211,156 |
) |
749,295 |
|
372,378 |
|
|
Country Club Lakes |
|
Jacksonville, FL |
|
1997 |
|
555 |
|
15,000,000 |
|
41,055,786 |
|
— |
|
1,458,520 |
|
15,000,000 |
|
42,514,306 |
|
57,514,306 |
|
(3,201,835 |
) |
54,312,471 |
|
34,106,923 |
|
|
Coventry at Cityview |
|
Fort Worth, TX |
|
1996 |
|
360 |
|
2,160,000 |
|
23,072,847 |
|
— |
|
1,805,282 |
|
2,160,000 |
|
24,878,129 |
|
27,038,129 |
|
(7,412,420 |
) |
19,625,709 |
|
(Q |
) |
|
Creekside (San Mateo) |
|
San Mateo, CA |
|
1985 |
|
192 |
|
9,606,600 |
|
21,193,232 |
|
— |
|
1,090,183 |
|
9,606,600 |
|
22,283,415 |
|
31,890,015 |
|
(6,693,710 |
) |
25,196,305 |
|
(O |
) |
|
Creekside Homes at Legacy |
|
Plano. TX |
|
1998 |
|
380 |
|
4,560,000 |
|
32,275,748 |
|
— |
|
1,925,740 |
|
4,560,000 |
|
34,201,488 |
|
38,761,488 |
|
(9,950,809 |
) |
28,810,679 |
|
16,800,000 |
|
|
Cross Creek |
|
Matthews, NC |
|
1989 |
|
420 |
|
3,151,600 |
|
20,295,925 |
|
— |
|
1,926,578 |
|
3,151,600 |
|
22,222,503 |
|
25,374,103 |
|
(7,077,104 |
) |
18,296,999 |
|
(O |
) |
|
Crown Court |
|
Scottsdale, AZ |
|
1987 |
|
416 |
|
3,156,600 |
|
28,414,599 |
|
— |
|
4,338,515 |
|
3,156,600 |
|
32,753,114 |
|
35,909,714 |
|
(11,534,011 |
) |
24,375,703 |
|
(P |
) |
|
Dean Estates II |
|
Cranston, RI |
|
1970 |
|
48 |
|
308,457 |
|
2,061,971 |
|
— |
|
404,267 |
|
308,457 |
|
2,466,238 |
|
2,774,695 |
|
(613,800 |
) |
2,160,895 |
|
(M |
) |
|
Deerwood (Corona) |
|
Corona, CA |
|
1992 |
|
316 |
|
4,742,200 |
|
20,272,892 |
|
— |
|
2,538,163 |
|
4,742,200 |
|
22,811,055 |
|
27,553,255 |
|
(7,870,791 |
) |
19,682,464 |
|
(Q |
) |
|
Eastbridge |
|
Dallas, TX |
|
1998 |
|
169 |
|
3,380,000 |
|
11,860,382 |
|
— |
|
661,554 |
|
3,380,000 |
|
12,521,935 |
|
15,901,935 |
|
(2,733,407 |
) |
13,168,528 |
|
8,026,896 |
|
|
Fernbrook Townhomes |
|
Plymouth, MN |
|
1993 |
|
72 |
|
580,100 |
|
6,683,693 |
|
— |
|
459,059 |
|
580,100 |
|
7,142,752 |
|
7,722,852 |
|
(2,206,216 |
) |
5,516,636 |
|
4,855,548 |
|
|
Fireside Park |
|
Rockville, MD |
|
1961 |
|
236 |
|
4,248,000 |
|
9,977,101 |
|
— |
|
2,323,800 |
|
4,248,000 |
|
12,300,901 |
|
16,548,901 |
|
(3,788,931 |
) |
12,759,970 |
|
8,095,000 |
|
|
Forest Ridge I & II |
|
Arlington, TX |
|
1984/85 |
|
660 |
|
2,362,700 |
|
21,263,295 |
|
— |
|
5,245,440 |
|
2,362,700 |
|
26,508,735 |
|
28,871,435 |
|
(10,897,465 |
) |
17,973,969 |
|
(P |
) |
|
Four Lakes 5 |
|
Lisle, IL (G) |
|
1968/1988 |
|
478 |
|
600,000 |
|
19,186,686 |
|
— |
|
3,171,557 |
|
600,000 |
|
22,358,243 |
|
22,958,243 |
|
(13,891,138 |
) |
9,067,105 |
|
(L |
) |
|
Four Winds |
|
Fall River, MA |
|
1987 |
|
168 |
|
1,370,843 |
|
9,163,804 |
|
— |
|
1,067,946 |
|
1,370,843 |
|
10,231,751 |
|
11,602,593 |
|
(2,345,502 |
) |
9,257,092 |
|
(M |
) |
|
Fox Hill Apartments |
|
Enfield, CT |
|
1974 |
|
168 |
|
1,129,018 |
|
7,547,256 |
|
— |
|
731,052 |
|
1,129,018 |
|
8,278,308 |
|
9,407,326 |
|
(1,959,318 |
) |
7,448,008 |
|
(M |
) |
|
Gallery, The |
|
Hermosa Beach,CA |
|
1971 |
|
168 |
|
18,144,000 |
|
46,565,645 |
|
— |
|
3,190 |
|
18,144,000 |
|
46,568,835 |
|
64,712,835 |
|
(543,302 |
) |
64,169,533 |
|
34,460,000 |
|
|
Geary Court Yard |
|
San Francisco, CA |
|
1990 |
|
164 |
|
1,722,400 |
|
15,471,429 |
|
— |
|
1,155,470 |
|
1,722,400 |
|
16,626,899 |
|
18,349,299 |
|
(5,446,542 |
) |
12,902,757 |
|
17,693,865 |
|
|
Glen Grove |
|
Wellesley, MA |
|
1979 |
|
125 |
|
1,344,601 |
|
8,988,383 |
|
— |
|
661,016 |
|
1,344,601 |
|
9,649,399 |
|
10,994,000 |
|
(2,225,895 |
) |
8,768,105 |
|
2,157,190 |
|
|
Glen Meadow |
|
Franklin, MA |
|
1971 |
|
288 |
|
2,339,330 |
|
17,796,431 |
|
— |
|
2,018,461 |
|
2,339,330 |
|
19,814,892 |
|
22,154,222 |
|
(4,542,534 |
) |
17,611,689 |
|
1,546,912 |
|
|
Glenlake |
|
Glendale Heights. IL |
|
1988 |
|
336 |
|
5,041,700 |
|
16,671,970 |
|
— |
|
4,635,767 |
|
5,041,700 |
|
21,307,737 |
|
26,349,437 |
|
(7,990,753 |
) |
18,358,684 |
|
14,845,000 |
|
|
Gosnold Grove |
|
East Falmouth, MA |
|
1978 |
|
33 |
|
124,296 |
|
830,891 |
|
— |
|
171,810 |
|
124,296 |
|
1,002,701 |
|
1,126,996 |
|
(282,786 |
) |
844,210 |
|
529,015 |
|
|
Greenhaven |
|
Union City, CA |
|
1983 |
|
250 |
|
7,507,000 |
|
15,210,399 |
|
— |
|
1,664,822 |
|
7,507,000 |
|
16,875,221 |
|
24,382,221 |
|
(5,413,716 |
) |
18,968,505 |
|
10,975,000 |
|
|
Greenhouse - Frey Road |
|
Kennesaw, GA |
|
1985 |
|
489 |
|
2,467,200 |
|
22,187,443 |
|
— |
|
3,643,631 |
|
2,467,200 |
|
25,831,074 |
|
28,298,274 |
|
(11,927,896 |
) |
16,370,378 |
|
(L |
) |
|
Greenhouse - Holcomb Bridge |
|
Alpharetta, GA |
|
1985 |
|
437 |
|
2,143,300 |
|
19,291,427 |
|
— |
|
3,431,367 |
|
2,143,300 |
|
22,722,795 |
|
24,866,095 |
|
(10,729,479 |
) |
14,136,616 |
|
(L |
) |
|
Greenhouse - Roswell |
|
Roswell, GA |
|
1985 |
|
236 |
|
1,220,000 |
|
10,974,727 |
|
— |
|
2,091,987 |
|
1,220,000 |
|
13,066,714 |
|
14,286,714 |
|
(6,262,485 |
) |
8,024,229 |
|
(L |
) |
|
Hampshire Place |
|
Los Angeles, CA |
|
1989 |
|
259 |
|
10,806,000 |
|
30,335,330 |
|
— |
|
954,609 |
|
10,806,000 |
|
31,289,939 |
|
42,095,939 |
|
(2,947,784 |
) |
39,148,155 |
|
18,681,951 |
|
|
Harbor Steps |
|
Seattle, WA (G) |
|
2000 |
|
730 |
|
59,900,000 |
|
158,829,662 |
|
— |
|
812,941 |
|
59,900,000 |
|
159,642,603 |
|
219,542,603 |
|
(9,618,544 |
) |
209,924,059 |
|
142,998,760 |
|
|
Heritage at Stone Ridge |
|
Burlington, MA |
|
2005 |
|
180 |
|
10,800,000 |
|
31,808,335 |
|
— |
|
13,390 |
|
10,800,000 |
|
31,821,725 |
|
42,621,725 |
|
(1,032,478 |
) |
41,589,248 |
|
29,186,892 |
|
|
Heritage Green |
|
Sturbridge, MA |
|
1974 |
|
130 |
|
835,313 |
|
5,583,898 |
|
— |
|
822,502 |
|
835,313 |
|
6,406,400 |
|
7,241,713 |
|
(1,583,527 |
) |
5,658,186 |
|
1,722,829 |
|
|
High Meadow |
|
Ellington, CT |
|
1975 |
|
100 |
|
583,679 |
|
3,901,774 |
|
— |
|
296,872 |
|
583,679 |
|
4,198,647 |
|
4,782,326 |
|
(1,016,090 |
) |
3,766,236 |
|
3,994,044 |
|
|
Highland Glen II |
|
Westwood, MA |
|
(F) |
|
— |
|
— |
|
7,069,447 |
|
— |
|
— |
|
— |
|
7,069,447 |
|
7,069,447 |
|
— |
|
7,069,447 |
|
1,384,362 |
|
|
Highland Point |
|
Aurora, CO |
|
1984 |
|
319 |
|
1,631,900 |
|
14,684,439 |
|
— |
|
1,900,859 |
|
1,631,900 |
|
16,585,298 |
|
18,217,198 |
|
(6,060,369 |
) |
12,156,829 |
|
(N |
) |
S-8
EQUITY RESIDENTIAL
Schedule III - Real Estate and Accumulated Depreciation
December 31, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost Capitalized |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsequent to |
|
|
|
Gross Amount Carried |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Initial Cost to |
|
|
|
Acquisition |
|
|
|
at Close of |
|
|
|
|
|
|
|
|
|
|
|
|
Description |
|
|
|
|
|
Company |
|
|
|
(Improvements, net) (E) |
|
|
|
Period 12/31/06 |
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
Date of |
|
|
|
|
|
Building & |
|
|
|
Building & |
|
|
|
Building & |
|
|
|
Accumulated |
|
Investment in Real |
|
|
|
|
Apartment Name |
|
Location |
|
Construction |
|
Units (I) |
|
Land |
|
Fixtures |
|
Land |
|
Fixtures |
|
Land |
|
Fixtures (A) |
|
Total (B) |
|
Depreciation (C) |
|
Estate, Net at 12/31/06 |
|
Encumbrances |
|
|
Highlands at Cherry Hill |
|
Cherry Hills, NJ |
|
2002 |
|
170 |
|
6,800,000 |
|
21,459,108 |
|
— |
|
63,469 |
|
6,800,000 |
|
21,522,577 |
|
28,322,577 |
|
(1,537,068 |
) |
26,785,509 |
|
16,983,599 |
|
|
Highlands at South Plainfield |
|
South Plainfield, NJ |
|
2000 |
|
252 |
|
10,080,000 |
|
37,526,912 |
|
— |
|
143,289 |
|
10,080,000 |
|
37,670,201 |
|
47,750,201 |
|
(2,182,182 |
) |
45,568,019 |
|
21,978,565 |
|
|
Highline Oaks |
|
Denver, CO |
|
1986 |
|
220 |
|
1,057,400 |
|
9,340,249 |
|
— |
|
1,633,630 |
|
1,057,400 |
|
10,973,879 |
|
12,031,279 |
|
(4,268,727 |
) |
7,762,552 |
|
(L |
) |
|
Isle at Arrowhead Ranch |
|
Glendale, AZ |
|
1996 |
|
256 |
|
1,650,237 |
|
19,593,123 |
|
— |
|
1,076,108 |
|
1,650,237 |
|
20,669,232 |
|
22,319,469 |
|
(6,635,237 |
) |
15,684,231 |
|
(N |
) |
|
Ivory Wood |
|
Bothell, WA |
|
2000 |
|
144 |
|
2,732,800 |
|
13,888,282 |
|
— |
|
260,308 |
|
2,732,800 |
|
14,148,590 |
|
16,881,390 |
|
(1,536,323 |
) |
15,345,067 |
|
8,020,000 |
|
|
Jaclen Towers |
|
Beverly, NJ |
|
1976 |
|
100 |
|
437,072 |
|
2,921,735 |
|
— |
|
757,876 |
|
437,072 |
|
3,679,611 |
|
4,116,683 |
|
(1,021,556 |
) |
3,095,127 |
|
1,662,193 |
|
|
James Street Crossing |
|
Kent, WA |
|
1989 |
|
300 |
|
2,081,254 |
|
18,748,337 |
|
— |
|
1,591,291 |
|
2,081,254 |
|
20,339,629 |
|
22,420,882 |
|
(6,793,182 |
) |
15,627,700 |
|
16,379,123 |
|
|
Laguna Clara |
|
Santa Clara, CA |
|
1972 |
|
264 |
|
13,642,420 |
|
29,707,475 |
|
— |
|
1,589,501 |
|
13,642,420 |
|
31,296,976 |
|
44,939,395 |
|
(3,593,540 |
) |
41,345,855 |
|
16,395,237 |
|
|
LaSalle |
|
Beaverton, OR (G) |
|
1998 |
|
554 |
|
7,202,000 |
|
35,877,612 |
|
— |
|
1,421,673 |
|
7,202,000 |
|
37,299,285 |
|
44,501,285 |
|
(6,286,439 |
) |
38,214,845 |
|
32,281,178 |
|
|
Legacy at Highlands Ranch |
|
Highlands Ranch, CO |
|
1999 |
|
422 |
|
6,330,000 |
|
37,557,013 |
|
— |
|
715,465 |
|
6,330,000 |
|
38,272,478 |
|
44,602,478 |
|
(3,683,899 |
) |
40,918,579 |
|
23,364,115 |
|
|
Legends at Preston |
|
Morrisville, NC |
|
2000 |
|
382 |
|
3,056,000 |
|
27,150,092 |
|
— |
|
825,344 |
|
3,056,000 |
|
27,975,437 |
|
31,031,437 |
|
(6,437,195 |
) |
24,594,241 |
|
(Q |
) |
|
Lenox at Patterson Place |
|
Durham, NC |
|
1999 |
|
292 |
|
4,380,000 |
|
18,969,172 |
|
— |
|
252,146 |
|
4,380,000 |
|
19,221,319 |
|
23,601,319 |
|
(1,733,779 |
) |
21,867,540 |
|
13,311,200 |
|
|
Liberty Park |
|
Brain Tree, MA |
|
2000 |
|
202 |
|
5,977,504 |
|
26,748,835 |
|
— |
|
1,144,941 |
|
5,977,504 |
|
27,893,775 |
|
33,871,279 |
|
(3,915,415 |
) |
29,955,864 |
|
26,500,000 |
|
|
Lincoln Heights |
|
Quincy, MA |
|
1991 |
|
336 |
|
5,928,400 |
|
33,595,262 |
|
— |
|
3,407,908 |
|
5,928,400 |
|
37,003,170 |
|
42,931,570 |
|
(11,388,352 |
) |
31,543,219 |
|
(O |
) |
|
Longfellow Glen |
|
Sudbury, MA |
|
1984 |
|
120 |
|
1,094,273 |
|
7,314,994 |
|
— |
|
1,962,404 |
|
1,094,273 |
|
9,277,398 |
|
10,371,671 |
|
(2,350,664 |
) |
8,021,007 |
|
3,646,298 |
|
|
Longwood |
|
Decatur, GA |
|
1992 |
|
268 |
|
1,454,048 |
|
13,087,393 |
|
— |
|
1,294,958 |
|
1,454,048 |
|
14,382,351 |
|
15,836,399 |
|
(6,580,613 |
) |
9,255,787 |
|
(P |
) |
|
Loomis Manor |
|
West Hartford, CT |
|
1948 |
|
43 |
|
422,350 |
|
2,823,326 |
|
— |
|
340,486 |
|
422,350 |
|
3,163,812 |
|
3,586,162 |
|
(777,046 |
) |
2,809,116 |
|
(M |
) |
|
Madison at Cedar Springs |
|
Dallas, TX |
|
1995 |
|
380 |
|
2,470,000 |
|
33,194,620 |
|
— |
|
1,812,787 |
|
2,470,000 |
|
35,007,407 |
|
37,477,407 |
|
(10,033,392 |
) |
27,444,015 |
|
(O |
) |
|
Madison at Chase Oaks |
|
Plano, TX |
|
1995 |
|
470 |
|
3,055,000 |
|
28,932,885 |
|
— |
|
1,660,074 |
|
3,055,000 |
|
30,592,959 |
|
33,647,959 |
|
(9,194,874 |
) |
24,453,085 |
|
(O |
) |
|
Madison at River Sound |
|
Lawrenceville, GA |
|
1996 |
|
586 |
|
3,666,999 |
|
47,387,106 |
|
— |
|
1,639,481 |
|
3,666,999 |
|
49,026,588 |
|
52,693,587 |
|
(14,219,468 |
) |
38,474,120 |
|
(Q |
) |
|
Madison at Round Grove |
|
Lewisville, TX |
|
1995 |
|
404 |
|
2,626,000 |
|
25,682,373 |
|
— |
|
2,025,283 |
|
2,626,000 |
|
27,707,656 |
|
30,333,656 |
|
(8,253,692 |
) |
22,079,964 |
|
(N |
) |
|
Madison at Scofield Farms |
|
Austin, TX |
|
1996 |
|
260 |
|
2,080,000 |
|
14,597,971 |
|
— |
|
1,761,739 |
|
2,080,000 |
|
16,359,710 |
|
18,439,710 |
|
(4,050,986 |
) |
14,388,723 |
|
11,809,427 |
|
|
Marks |
|
Englewood, CO (G) |
|
1987 |
|
616 |
|
4,928,500 |
|
44,622,314 |
|
— |
|
3,818,828 |
|
4,928,500 |
|
48,441,143 |
|
53,369,643 |
|
(17,079,936 |
) |
36,289,707 |
|
19,195,000 |
|
|
Meadow Ridge |
|
Norwich, CT |
|
1987 |
|
120 |
|
747,957 |
|
4,999,937 |
|
— |
|
435,724 |
|
747,957 |
|
5,435,661 |
|
6,183,617 |
|
(1,283,296 |
) |
4,900,321 |
|
4,186,418 |
|
|
Merritt at Satellite Place |
|
Duluth, GA |
|
1999 |
|
424 |
|
3,400,000 |
|
30,115,674 |
|
— |
|
846,006 |
|
3,400,000 |
|
30,961,680 |
|
34,361,680 |
|
(8,002,830 |
) |
26,358,850 |
|
(P |
) |
|
Mill Pond |
|
Millersville, MD |
|
1984 |
|
240 |
|
2,880,000 |
|
8,468,014 |
|
— |
|
1,606,331 |
|
2,880,000 |
|
10,074,345 |
|
12,954,345 |
|
(3,366,047 |
) |
9,588,298 |
|
7,300,000 |
|
|
Montierra |
|
Scottsdale, AZ |
|
1999 |
|
249 |
|
3,455,000 |
|
17,266,787 |
|
— |
|
902,348 |
|
3,455,000 |
|
18,169,134 |
|
21,624,134 |
|
(5,019,201 |
) |
16,604,934 |
|
(N |
) |
|
Montierra (CA) |
|
San Diego, CA |
|
1990 |
|
272 |
|
8,160,000 |
|
29,360,938 |
|
— |
|
5,248,802 |
|
8,160,000 |
|
34,609,740 |
|
42,769,740 |
|
(7,632,314 |
) |
35,137,427 |
|
17,065,682 |
|
|
Nehoiden Glen |
|
Needham, MA |
|
1978 |
|
61 |
|
634,538 |
|
4,241,755 |
|
— |
|
396,597 |
|
634,538 |
|
4,638,352 |
|
5,272,890 |
|
(1,085,007 |
) |
4,187,883 |
|
853,972 |
|
|
Noonan Glen |
|
Winchester, MA |
|
1983 |
|
18 |
|
151,344 |
|
1,011,700 |
|
— |
|
253,182 |
|
151,344 |
|
1,264,882 |
|
1,416,226 |
|
(315,708 |
) |
1,100,518 |
|
367,925 |
|
|
North Hill |
|
Atlanta, GA |
|
1984 |
|
420 |
|
2,525,300 |
|
18,550,989 |
|
— |
|
5,869,398 |
|
2,525,300 |
|
24,420,387 |
|
26,945,687 |
|
(10,470,941 |
) |
16,474,747 |
|
15,005,000 |
|
|
Northampton 1 |
|
Largo, MD |
|
1977 |
|
344 |
|
1,843,200 |
|
17,528,381 |
|
— |
|
4,450,047 |
|
1,843,200 |
|
21,978,428 |
|
23,821,628 |
|
(10,415,820 |
) |
13,405,808 |
|
18,518,465 |
|
|
Northglen |
|
Valencia, CA |
|
1988 |
|
234 |
|
9,360,000 |
|
20,778,553 |
|
— |
|
970,063 |
|
9,360,000 |
|
21,748,615 |
|
31,108,615 |
|
(4,827,171 |
) |
26,281,445 |
|
14,002,893 |
|
|
Norton Glen |
|
Norton, MA |
|
1983 |
|
150 |
|
1,012,556 |
|
6,768,727 |
|
— |
|
2,319,858 |
|
1,012,556 |
|
9,088,585 |
|
10,101,141 |
|
(2,410,159 |
) |
7,690,982 |
|
3,455,734 |
|
|
Oak Mill I |
|
Germantown, MD |
|
1984 |
|
208 |
|
10,000,000 |
|
13,155,522 |
|
— |
|
2,964,729 |
|
10,000,000 |
|
16,120,251 |
|
26,120,251 |
|
(1,030,729 |
) |
25,089,521 |
|
14,020,434 |
|
|
Oak Mill II |
|
Germantown, MD |
|
1985 |
|
192 |
|
854,133 |
|
10,233,947 |
|
— |
|
4,076,264 |
|
854,133 |
|
14,310,211 |
|
15,164,344 |
|
(4,691,037 |
) |
10,473,306 |
|
9,600,000 |
|
|
Oak Park North |
|
Agoura Hills, CA |
|
1990 |
|
220 |
|
1,706,900 |
|
15,362,666 |
|
— |
|
1,364,400 |
|
1,706,900 |
|
16,727,066 |
|
18,433,966 |
|
(6,610,491 |
) |
11,823,475 |
|
(H |
) |
|
Oak Park South |
|
Agoura Hills, CA |
|
1989 |
|
224 |
|
1,683,800 |
|
15,154,608 |
|
— |
|
1,458,829 |
|
1,683,800 |
|
16,613,437 |
|
18,297,237 |
|
(6,612,935 |
) |
11,684,302 |
|
(H |
) |
|
Oaks |
|
Santa Clarita, CA |
|
2000 |
|
520 |
|
23,400,000 |
|
61,020,438 |
|
— |
|
1,526,455 |
|
23,400,000 |
|
62,546,893 |
|
85,946,893 |
|
(8,311,764 |
) |
77,635,129 |
|
44,145,593 |
|
|
Ocean Walk |
|
Key West, FL |
|
1990 |
|
297 |
|
2,838,749 |
|
25,545,009 |
|
— |
|
1,962,607 |
|
2,838,749 |
|
27,507,616 |
|
30,346,365 |
|
(9,010,029 |
) |
21,336,335 |
|
21,079,921 |
|
|
Old Mill Glen |
|
Maynard, MA |
|
1983 |
|
50 |
|
396,756 |
|
2,652,233 |
|
— |
|
349,674 |
|
396,756 |
|
3,001,907 |
|
3,398,663 |
|
(727,222 |
) |
2,671,441 |
|
1,470,615 |
|
|
Olde Redmond Place |
|
Redmond, WA |
|
1986 |
|
192 |
|
4,807,100 |
|
14,126,038 |
|
— |
|
3,560,002 |
|
4,807,100 |
|
17,686,040 |
|
22,493,140 |
|
(5,219,902 |
) |
17,273,238 |
|
(O |
) |
|
Parkfield |
|
Denver, CO |
|
2000 |
|
476 |
|
8,330,000 |
|
28,667,618 |
|
— |
|
1,269,982 |
|
8,330,000 |
|
29,937,600 |
|
38,267,600 |
|
(6,557,488 |
) |
31,710,112 |
|
23,275,000 |
|
|
Point (NC) |
|
Charlotte, NC |
|
1996 |
|
340 |
|
1,700,000 |
|
25,417,267 |
|
— |
|
808,668 |
|
1,700,000 |
|
26,225,935 |
|
27,925,935 |
|
(7,691,364 |
) |
20,234,571 |
|
(P |
) |
|
Portofino (Val) |
|
Valencia, CA |
|
1989 |
|
216 |
|
8,640,000 |
|
21,487,126 |
|
— |
|
1,185,661 |
|
8,640,000 |
|
22,672,788 |
|
31,312,788 |
|
(4,905,494 |
) |
26,407,294 |
|
13,612,927 |
|
|
Portside Towers |
|
Jersey City, NJ (G) |
|
1992/1997 |
|
527 |
|
22,455,700 |
|
96,842,913 |
|
— |
|
5,787,065 |
|
22,455,700 |
|
102,629,978 |
|
125,085,678 |
|
(30,931,907 |
) |
94,153,771 |
|
51,660,809 |
|
|
Prairie Creek I |
|
Richardson, TX |
|
1998/99 |
|
464 |
|
4,067,292 |
|
38,986,022 |
|
— |
|
1,770,999 |
|
4,067,292 |
|
40,757,021 |
|
44,824,312 |
|
(11,297,225 |
) |
33,527,088 |
|
(N |
) |
|
Preston Bend |
|
Dallas, TX |
|
1986 |
|
255 |
|
1,075,200 |
|
9,532,056 |
|
— |
|
1,452,729 |
|
1,075,200 |
|
10,984,786 |
|
12,059,986 |
|
(4,065,152 |
) |
7,994,833 |
|
(L |
) |
|
Promenade at Town Center II |
|
Valencia, CA |
|
2001 |
|
270 |
|
13,500,000 |
|
34,405,636 |
|
— |
|
1,099,138 |
|
13,500,000 |
|
35,504,774 |
|
49,004,774 |
|
(4,091,670 |
) |
44,913,104 |
|
35,381,430 |
|
|
Providence at Kirby |
|
Houston, TX |
|
1999 |
|
263 |
|
3,945,000 |
|
20,587,782 |
|
— |
|
2,082,938 |
|
3,945,000 |
|
22,670,720 |
|
26,615,720 |
|
(3,981,248 |
) |
22,634,472 |
|
17,497,407 |
|
|
Ranchstone |
|
Houston, TX |
|
1996 |
|
220 |
|
770,000 |
|
15,371,431 |
|
— |
|
698,002 |
|
770,000 |
|
16,069,433 |
|
16,839,433 |
|
(4,760,662 |
) |
12,078,771 |
|
(P |
) |
|
Ravens Crest |
|
Plainsboro, NJ |
|
1984 |
|
704 |
|
4,670,850 |
|
42,080,642 |
|
— |
|
9,158,080 |
|
4,670,850 |
|
51,238,722 |
|
55,909,572 |
|
(22,212,136 |
) |
33,697,436 |
|
(O |
) |
|
Reserve at Ashley Lake |
|
Boynton Beach, FL |
|
1990 |
|
440 |
|
3,520,400 |
|
23,332,494 |
|
— |
|
2,829,478 |
|
3,520,400 |
|
26,161,972 |
|
29,682,372 |
|
(8,704,513 |
) |
20,977,859 |
|
24,150,000 |
|
|
Reserve at Fairfax Corners |
|
Fairfax, VA |
|
2001 |
|
652 |
|
15,804,057 |
|
63,129,051 |
|
— |
|
822,238 |
|
15,804,057 |
|
63,951,288 |
|
79,755,345 |
|
(10,417,153 |
) |
69,338,192 |
|
(Q |
) |
|
Reserve at Potomac Yard |
|
Alexandria, VA |
|
2002 |
|
588 |
|
11,918,917 |
|
68,976,484 |
|
— |
|
976,677 |
|
11,918,917 |
|
69,953,161 |
|
81,872,077 |
|
(7,383,279 |
) |
74,488,799 |
|
66,470,000 |
|
|
Reserve at Town Center |
|
Loudon, VA |
|
2002 |
|
290 |
|
3,144,056 |
|
27,669,121 |
|
— |
|
447,296 |
|
3,144,056 |
|
28,116,417 |
|
31,260,473 |
|
(3,156,973 |
) |
28,103,500 |
|
26,500,000 |
|
|
Reserve at Town Center (WA) |
|
Mill Creek, WA |
|
2001 |
|
389 |
|
10,369,400 |
|
41,172,081 |
|
— |
|
551,112 |
|
10,369,400 |
|
41,723,193 |
|
52,092,593 |
|
(4,326,324 |
) |
47,766,269 |
|
29,160,000 |
|
|
Retreat, The |
|
Phoenix, AZ |
|
1999 |
|
480 |
|
3,475,114 |
|
27,265,252 |
|
— |
|
1,384,123 |
|
3,475,114 |
|
28,649,375 |
|
32,124,489 |
|
(7,798,799 |
) |
24,325,691 |
|
(P |
) |
|
Ribbon Mill |
|
Manchester, CT |
|
1908 |
|
104 |
|
787,929 |
|
5,267,144 |
|
— |
|
450,152 |
|
787,929 |
|
5,717,296 |
|
6,505,225 |
|
(1,372,176 |
) |
5,133,049 |
|
4,177,257 |
|
|
River Pointe at Den Rock Park |
|
Lawrence, MA |
|
2000 |
|
174 |
|
4,615,702 |
|
18,440,147 |
|
— |
|
731,030 |
|
4,615,702 |
|
19,171,177 |
|
23,786,879 |
|
(3,019,924 |
) |
20,766,956 |
|
18,100,000 |
|
|
Rivers Bend (CT) |
|
Windsor, CT |
|
1973 |
|
373 |
|
3,325,517 |
|
22,573,826 |
|
— |
|
1,470,299 |
|
3,325,517 |
|
24,044,125 |
|
27,369,642 |
|
(5,577,831 |
) |
21,791,811 |
|
(M |
) |
|
Riverview Condominiums |
|
Norwalk, CT |
|
1991 |
|
92 |
|
2,300,000 |
|
7,406,730 |
|
— |
|
1,451,122 |
|
2,300,000 |
|
8,857,852 |
|
11,157,852 |
|
(2,576,581 |
) |
8,581,271 |
|
5,762,246 |
|
|
Rockingham Glen |
|
West Roxbury, MA |
|
1974 |
|
143 |
|
1,124,217 |
|
7,515,160 |
|
— |
|
1,030,086 |
|
1,124,217 |
|
8,545,246 |
|
9,669,463 |
|
(2,046,224 |
) |
7,623,239 |
|
1,982,265 |
|
|
Rolling Green (Amherst) |
|
Amherst, MA |
|
1970 |
|
204 |
|
1,340,702 |
|
8,962,317 |
|
— |
|
2,483,372 |
|
1,340,702 |
|
11,445,689 |
|
12,786,391 |
|
(2,933,371 |
) |
9,853,020 |
|
3,176,795 |
|
|
Rolling Green (Milford) |
|
Milford, MA |
|
1970 |
|
304 |
|
2,012,350 |
|
13,452,150 |
|
— |
|
2,233,452 |
|
2,012,350 |
|
15,685,602 |
|
17,697,952 |
|
(4,166,739 |
) |
13,531,213 |
|
6,411,164 |
|
|
Royale |
|
Cranston, RI |
|
1976 |
|
76 |
|
512,785 |
|
3,427,866 |
|
— |
|
511,169 |
|
512,785 |
|
3,939,035 |
|
4,451,820 |
|
(970,344 |
) |
3,481,476 |
|
(M |
) |
|
Savannah Midtown |
|
Atlanta, GA |
|
2000 |
|
322 |
|
7,209,873 |
|
29,433,507 |
|
— |
|
701,727 |
|
7,209,873 |
|
30,135,234 |
|
37,345,107 |
|
(3,435,943 |
) |
33,909,164 |
|
17,800,000 |
|
|
Savoy I |
|
Aurora, CO |
|
2001 |
|
444 |
|
6,109,460 |
|
38,765,670 |
|
— |
|
863,806 |
|
6,109,460 |
|
39,629,476 |
|
45,738,936 |
|
(4,610,717 |
) |
41,128,219 |
|
(O |
) |
|
Scarborough Square |
|
Rockville, MD |
|
1967 |
|
121 |
|
1,815,000 |
|
7,608,126 |
|
— |
|
1,609,081 |
|
1,815,000 |
|
9,217,207 |
|
11,032,207 |
|
(2,977,714 |
) |
8,054,493 |
|
4,652,200 |
|
|
Security Manor |
|
Westfield, MA |
|
1971 |
|
63 |
|
355,456 |
|
2,376,152 |
|
— |
|
156,428 |
|
355,456 |
|
2,532,580 |
|
2,888,036 |
|
(590,736 |
) |
2,297,301 |
|
(M |
) |
|
Sedona Springs |
|
Austin, TX |
|
1995 |
|
396 |
|
2,574,000 |
|
23,477,043 |
|
— |
|
2,690,214 |
|
2,574,000 |
|
26,167,257 |
|
28,741,257 |
|
(7,987,754 |
) |
20,753,502 |
|
(P |
) |
|
Siena Terrace |
|
Lake Forest, CA |
|
1988 |
|
356 |
|
8,900,000 |
|
24,083,024 |
|
— |
|
1,856,227 |
|
8,900,000 |
|
25,939,250 |
|
34,839,250 |
|
(7,445,906 |
) |
27,393,345 |
|
16,743,402 |
|
|
Skycrest |
|
Valencia, CA |
|
1999 |
|
264 |
|
10,560,000 |
|
25,574,457 |
|
— |
|
1,143,673 |
|
10,560,000 |
|
26,718,131 |
|
37,278,131 |
|
(5,823,540 |
) |
31,454,591 |
|
16,946,177 |
|
|
Skyline Towers |
|
Falls Church, VA (G) |
|
1971 |
|
939 |
|
78,278,200 |
|
91,484,764 |
|
— |
|
1,268,870 |
|
78,278,200 |
|
92,753,635 |
|
171,031,835 |
|
(7,102,912 |
) |
163,928,923 |
|
92,594,283 |
|
|
Skyview |
|
Rancho Santa Margarita, CA |
|
1999 |
|
260 |
|
3,380,000 |
|
21,952,863 |
|
— |
|
866,189 |
|
3,380,000 |
|
22,819,052 |
|
26,199,052 |
|
(6,091,615 |
) |
20,107,437 |
|
(P |
) |
|
Sonterra at Foothill Ranch |
|
Foothill Ranch, CA |
|
1997 |
|
300 |
|
7,503,400 |
|
24,048,507 |
|
— |
|
1,073,835 |
|
7,503,400 |
|
25,122,342 |
|
32,625,742 |
|
(7,798,632 |
) |
24,827,110 |
|
(O |
) |
|
South Winds |
|
Fall River, MA |
|
1971 |
|
404 |
|
2,481,821 |
|
16,780,359 |
|
— |
|
2,450,689 |
|
2,481,821 |
|
19,231,048 |
|
21,712,869 |
|
(4,988,894 |
) |
16,723,975 |
|
6,329,013 |
|
|
Springs Colony |
|
Altamonte Springs, FL |
|
1986 |
|
188 |
|
630,411 |
|
5,852,157 |
|
— |
|
1,859,211 |
|
630,411 |
|
7,711,368 |
|
8,341,779 |
|
(3,732,774 |
) |
4,609,005 |
|
(L |
) |
|
Stoney Ridge |
|
Dale City, VA |
|
1985 |
|
264 |
|
8,000,000 |
|
24,147,091 |
|
— |
|
3,203,633 |
|
8,000,000 |
|
27,350,724 |
|
35,350,724 |
|
(1,580,144 |
) |
33,770,580 |
|
16,487,748 |
|
|
Stonybrook |
|
Boynton Beach, FL |
|
2001 |
|
264 |
|
10,500,000 |
|
24,967,638 |
|
— |
|
300,654 |
|
10,500,000 |
|
25,268,292 |
|
35,768,292 |
|
(2,025,736 |
) |
33,742,556 |
|
22,698,602 |
|
|
Summer Chase |
|
Denver, CO |
|
1983 |
|
384 |
|
1,709,200 |
|
15,375,008 |
|
— |
|
2,928,364 |
|
1,709,200 |
|
18,303,372 |
|
20,012,572 |
|
(7,717,479 |
) |
12,295,094 |
|
(N |
) |
|
Summerhill Glen |
|
Maynard, MA |
|
1980 |
|
120 |
|
415,812 |
|
3,000,816 |
|
— |
|
518,109 |
|
415,812 |
|
3,518,925 |
|
3,934,737 |
|
(958,487 |
) |
2,976,250 |
|
1,615,411 |
|
|
Summerset Village |
|
Chatsworth, CA |
|
1985 |
|
280 |
|
2,630,700 |
|
23,670,889 |
|
— |
|
2,156,850 |
|
2,630,700 |
|
25,827,740 |
|
28,458,440 |
|
(9,276,969 |
) |
19,181,471 |
|
(N |
) |
|
Summit & Birch Hill |
|
Farmington, CT |
|
1967 |
|
186 |
|
1,757,438 |
|
11,748,112 |
|
— |
|
1,295,341 |
|
1,757,438 |
|
13,043,453 |
|
14,800,891 |
|
(3,051,136 |
) |
11,749,755 |
|
(M |
) |
|
Talleyrand |
|
Tarrytown, NY (L) |
|
1997-98 |
|
300 |
|
12,000,000 |
|
49,838,160 |
|
— |
|
3,009,985 |
|
12,000,000 |
|
52,848,145 |
|
64,848,145 |
|
(9,749,010 |
) |
55,099,135 |
|
35,000,000 |
|
|
Tanasbourne Terrace |
|
Hillsboro, OR |
|
1986-89 |
|
373 |
|
1,876,700 |
|
16,891,205 |
|
— |
|
3,176,067 |
|
1,876,700 |
|
20,067,272 |
|
21,943,972 |
|
(9,226,767 |
) |
12,717,204 |
|
(N |
) |
|
Tanglewood (RI) |
|
West Warwick, RI |
|
1973 |
|
176 |
|
1,141,415 |
|
7,630,129 |
|
— |
|
542,318 |
|
1,141,415 |
|
8,172,446 |
|
9,313,862 |
|
(1,928,816 |
) |
7,385,046 |
|
6,119,315 |
|
|
Tanglewood (VA) |
|
Manassas, VA |
|
1987 |
|
432 |
|
2,108,295 |
|
24,619,495 |
|
— |
|
6,755,046 |
|
2,108,295 |
|
31,374,541 |
|
33,482,836 |
|
(11,409,349 |
) |
22,073,486 |
|
25,110,000 |
|
|
Turf Club |
|
Littleton, CO |
|
1986 |
|
324 |
|
2,107,300 |
|
15,478,040 |
|
— |
|
2,437,516 |
|
2,107,300 |
|
17,915,556 |
|
20,022,856 |
|
(6,336,194 |
) |
13,686,662 |
|
(P |
) |
|
Union Station |
|
Los Angeles, CA |
|
(F) |
|
— |
|
8,500,000 |
|
56,351,848 |
|
— |
|
20,708 |
|
8,500,000 |
|
56,372,555 |
|
64,872,555 |
|
— |
|
64,872,555 |
|
39,786,999 |
|
|
Uwajimaya Village |
|
Seattle, WA |
|
2002 |
|
176 |
|
8,800,000 |
|
22,188,275 |
|
— |
|
13,008 |
|
8,800,000 |
|
22,201,283 |
|
31,001,283 |
|
(1,362,172 |
) |
29,639,111 |
|
17,110,471 |
|
|
Van Deene Manor |
|
West Springfield, MA |
|
1970 |
|
111 |
|
744,491 |
|
4,976,771 |
|
— |
|
413,979 |
|
744,491 |
|
5,390,750 |
|
6,135,241 |
|
(1,289,474 |
) |
4,845,767 |
|
(M |
) |
|
Villa Encanto |
|
Phoenix, AZ |
|
1983 |
|
383 |
|
2,884,447 |
|
22,197,363 |
|
— |
|
2,637,833 |
|
2,884,447 |
|
24,835,196 |
|
27,719,643 |
|
(8,701,565 |
) |
19,018,078 |
|
(P |
) |
|
Village at Bear Creek |
|
Lakewood, CO |
|
1987 |
|
472 |
|
4,519,700 |
|
40,676,390 |
|
— |
|
2,605,666 |
|
4,519,700 |
|
43,282,056 |
|
47,801,756 |
|
(14,573,650 |
) |
33,228,106 |
|
(O |
) |
S-9
EQUITY RESIDENTIAL
Schedule III - Real Estate and Accumulated Depreciation
December 31, 2006
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost Capitalized |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsequent to |
|
|
|
Gross Amount Carried |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
Initial Cost to |
|
|
|
Acquisition |
|
|
|
at Close of |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Description |
|
|
|
|
|
Company |
|
|
|
(Improvements, net) (E) |
|
|
|
Period 12/31/06 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
Date of |
|
|
|
|
|
Building & |
|
|
|
Building & |
|
|
|
Building & |
|
|
|
Accumulated |
|
Investment in Real |
|
|
|
||||||||||
|
Apartment Name |
|
Location |
|
Construction |
|
Units (I) |
|
Land |
|
Fixtures |
|
Land |
|
Fixtures |
|
Land |
|
Fixtures (A) |
|
Total (B) |
|
Depreciation (C) |
|
Estate, Net at 12/31/06 |
|
Encumbrances |
|
||||||||||
|
Villas at Josey Ranch |
|
Carrollton, TX |
|
1986 |
|
198 |
|
1,587,700 |
|
7,254,727 |
|
— |
|
1,730,751 |
|
1,587,700 |
|
8,985,479 |
|
10,573,179 |
|
(3,057,535 |
) |
7,515,643 |
|
6,092,776 |
|
||||||||||
|
Vintage |
|
Ontario, CA |
|
(F) |
|
— |
|
7,059,230 |
|
38,083,277 |
|
— |
|
— |
|
7,059,230 |
|
38,083,277 |
|
45,142,508 |
|
— |
|
45,142,508 |
|
40,775,042 |
|
||||||||||
|
Vista Del Lago (TX) |
|
Dallas, TX |
|
1992 |
|
296 |
|
3,552,000 |
|
20,066,912 |
|
— |
|
1,202,082 |
|
3,552,000 |
|
21,268,994 |
|
24,820,994 |
|
(4,704,851 |
) |
20,116,143 |
|
(N |
) |
||||||||||
|
Warwick Station |
|
Westminster, CO |
|
1986 |
|
332 |
|
2,282,000 |
|
21,113,974 |
|
— |
|
1,633,183 |
|
2,282,000 |
|
22,747,157 |
|
25,029,157 |
|
(7,684,285 |
) |
17,344,872 |
|
8,355,000 |
|
||||||||||
|
Waterford at Orange Park |
|
Orange Park, FL |
|
1986 |
|
280 |
|
1,960,000 |
|
12,098,784 |
|
— |
|
2,313,997 |
|
1,960,000 |
|
14,412,782 |
|
16,372,782 |
|
(4,971,051 |
) |
11,401,731 |
|
9,540,000 |
|
||||||||||
|
Waterford at the Lakes |
|
Kent, WA |
|
1990 |
|
344 |
|
3,100,200 |
|
16,140,924 |
|
— |
|
1,843,767 |
|
3,100,200 |
|
17,984,691 |
|
21,084,891 |
|
(6,698,259 |
) |
14,386,632 |
|
(Q |
) |
||||||||||
|
Wellington Hill |
|
Manchester, NH |
|
1987 |
|
390 |
|
1,890,200 |
|
17,120,662 |
|
— |
|
4,805,649 |
|
1,890,200 |
|
21,926,311 |
|
23,816,511 |
|
(10,361,742 |
) |
13,454,769 |
|
(L |
) |
||||||||||
|
Westgate |
|
Pasadena, CA |
|
(F) |
|
— |
|
46,802,616 |
|
10,480,376 |
|
— |
|
— |
|
46,802,616 |
|
10,480,376 |
|
57,282,992 |
|
— |
|
57,282,992 |
|
28,666,040 |
|
||||||||||
|
Westwood Glen |
|
Westwood, MA |
|
1972 |
|
156 |
|
1,616,505 |
|
10,806,004 |
|
— |
|
390,684 |
|
1,616,505 |
|
11,196,688 |
|
12,813,193 |
|
(2,541,517 |
) |
10,271,676 |
|
981,284 |
|
||||||||||
|
Whisper Creek |
|
Denver, CO |
|
2002 |
|
272 |
|
5,310,000 |
|
22,998,558 |
|
— |
|
365,119 |
|
5,310,000 |
|
23,363,677 |
|
28,673,677 |
|
(2,259,697 |
) |
26,413,980 |
|
13,580,000 |
|
||||||||||
|
Wilkins Glen |
|
Medfield, MA |
|
1975 |
|
103 |
|
538,483 |
|
3,629,943 |
|
— |
|
661,999 |
|
538,483 |
|
4,291,942 |
|
4,830,425 |
|
(1,119,190 |
) |
3,711,235 |
|
1,436,791 |
|
||||||||||
|
Windridge (CA) |
|
Laguna Niguel, CA |
|
1989 |
|
344 |
|
2,662,900 |
|
23,985,497 |
|
— |
|
3,097,251 |
|
2,662,900 |
|
27,082,747 |
|
29,745,647 |
|
(11,907,606 |
) |
17,838,042 |
|
(H |
) |
||||||||||
|
Woodbridge |
|
Cary, GA |
|
1993-95 |
|
128 |
|
737,400 |
|
6,636,870 |
|
— |
|
1,121,244 |
|
737,400 |
|
7,758,114 |
|
8,495,514 |
|
(3,070,630 |
) |
5,424,884 |
|
4,175,389 |
|
||||||||||
|
Woodbridge (CT) |
|
Newington, CT |
|
1968 |
|
73 |
|
498,377 |
|
3,331,548 |
|
— |
|
476,311 |
|
498,377 |
|
3,807,859 |
|
4,306,236 |
|
(872,673 |
) |
3,433,563 |
|
(M |
) |
||||||||||
|
Woodlake (WA) |
|
Kirkland, WA |
|
1984 |
|
288 |
|
6,631,400 |
|
16,735,484 |
|
— |
|
1,886,511 |
|
6,631,400 |
|
18,621,995 |
|
25,253,395 |
|
(5,965,512 |
) |
19,287,883 |
|
(O |
) |
||||||||||
|
Woodleaf |
|
Campbell, CA |
|
1984 |
|
178 |
|
8,550,600 |
|
16,988,183 |
|
— |
|
865,954 |
|
8,550,600 |
|
17,854,137 |
|
26,404,737 |
|
(5,440,933 |
) |
20,963,803 |
|
(O |
) |
||||||||||
|
Woodridge (MN) |
|
Eagan, MN |
|
1986 |
|
200 |
|
1,602,300 |
|
10,449,579 |
|
— |
|
1,558,895 |
|
1,602,300 |
|
12,008,474 |
|
13,610,774 |
|
(4,033,502 |
) |
9,577,272 |
|
7,060,251 |
|
||||||||||
|
EQR Wholly Owned Encumbered |
|
|
|
|
|
48,540 |
|
998,881,216 |
|
3,931,377,111 |
|
— |
|
291,342,825 |
|
998,881,216 |
|
4,222,719,936 |
|
5,221,601,153 |
|
(936,392,757 |
) |
4,285,208,396 |
|
1,923,428,819 |
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
EQR Partially Owned Unencumbered: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
1210 Mass |
|
Washington, D.C. |
|
2004 |
|
144 |
|
9,213,512 |
|
30,728,957 |
|
— |
|
110,955 |
|
9,213,512 |
|
30,839,912 |
|
40,053,425 |
|
(2,545,296 |
) |
37,508,129 |
|
— |
|
||||||||||
|
Ball Park Lofts |
|
Denver, CO |
|
2003 |
|
339 |
|
5,481,556 |
|
53,226,470 |
|
— |
|
395,599 |
|
5,481,556 |
|
53,622,070 |
|
59,103,626 |
|
(5,115,208 |
) |
53,988,418 |
|
— |
|
||||||||||
|
EQR Partially Owned Unencumbered |
|
|
|
|
|
483 |
|
14,695,068 |
|
83,955,427 |
|
— |
|
506,554 |
|
14,695,068 |
|
84,461,982 |
|
99,157,051 |
|
(7,660,504 |
) |
91,496,547 |
|
— |
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
EQR Partially Owned Encumbered: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Bella Terra I |
|
Mukilteo, WA |
|
2002 |
|
235 |
|
5,686,861 |
|
26,070,540 |
|
— |
|
312,115 |
|
5,686,861 |
|
26,382,655 |
|
32,069,517 |
|
(3,115,530 |
) |
28,953,986 |
|
23,350,000 |
|
||||||||||
|
Brookside Crossing I |
|
Stockton, CA |
|
1981 |
|
90 |
|
625,000 |
|
4,663,298 |
|
— |
|
1,365,294 |
|
625,000 |
|
6,028,592 |
|
6,653,592 |
|
(1,566,398 |
) |
5,087,194 |
|
4,658,000 |
|
||||||||||
|
Brookside Crossing II |
|
Stockton, CA |
|
1981 |
|
128 |
|
770,000 |
|
5,967,676 |
|
— |
|
1,374,519 |
|
770,000 |
|
7,342,194 |
|
8,112,194 |
|
(1,728,481 |
) |
6,383,713 |
|
4,867,000 |
|
||||||||||
|
Canyon Creek (CA) |
|
San Ramon, CA |
|
1984 |
|
268 |
|
5,425,000 |
|
18,812,121 |
|
— |
|
1,593,132 |
|
5,425,000 |
|
20,405,252 |
|
25,830,252 |
|
(4,384,869 |
) |
21,445,384 |
|
28,000,000 |
|
||||||||||
|
Cobblestone Village |
|
Fresno, CA |
|
1983 |
|
162 |
|
315,000 |
|
7,587,004 |
|
— |
|
1,551,020 |
|
315,000 |
|
9,138,024 |
|
9,453,024 |
|
(1,894,336 |
) |
7,558,688 |
|
6,000,000 |
|
||||||||||
|
Country Oaks |
|
Agoura Hills, CA |
|
1985 |
|
256 |
|
6,105,000 |
|
29,561,865 |
|
— |
|
1,897,266 |
|
6,105,000 |
|
31,459,131 |
|
37,564,131 |
|
(5,447,312 |
) |
32,116,819 |
|
29,412,000 |
|
||||||||||
|
Deerfield |
|
Denver, CO |
|
1983 |
|
158 |
|
1,260,000 |
|
8,502,224 |
|
— |
|
1,345,675 |
|
1,260,000 |
|
9,847,899 |
|
11,107,899 |
|
(2,357,475 |
) |
8,750,424 |
|
9,100,000 |
|
||||||||||
|
Edgewater |
|
Bakersfield, CA |
|
1984 |
|
258 |
|
580,000 |
|
17,710,063 |
|
— |
|
1,845,232 |
|
580,000 |
|
19,555,294 |
|
20,135,294 |
|
(3,684,647 |
) |
16,450,647 |
|
11,988,000 |
|
||||||||||
|
Fox Ridge |
|
Englewood, CO |
|
1984 |
|
300 |
|
2,490,000 |
|
17,522,114 |
|
— |
|
1,649,489 |
|
2,490,000 |
|
19,171,603 |
|
21,661,603 |
|
(4,673,060 |
) |
16,988,543 |
|
20,300,000 |
|
||||||||||
|
Hidden Lake |
|
Sacramento, CA |
|
1985 |
|
272 |
|
1,715,000 |
|
16,413,154 |
|
— |
|
1,750,680 |
|
1,715,000 |
|
18,163,833 |
|
19,878,833 |
|
(3,784,138 |
) |
16,094,696 |
|
15,165,000 |
|
||||||||||
|
Lakeview |
|
Lodi, CA |
|
1983 |
|
138 |
|
950,000 |
|
7,383,862 |
|
— |
|
1,207,936 |
|
950,000 |
|
8,591,798 |
|
9,541,798 |
|
(1,890,044 |
) |
7,651,754 |
|
7,286,000 |
|
||||||||||
|
Lakewood |
|
Tulsa, OK |
|
1985 |
|
152 |
|
855,000 |
|
6,480,774 |
|
— |
|
900,713 |
|
855,000 |
|
7,381,487 |
|
8,236,487 |
|
(1,958,047 |
) |
6,278,440 |
|
5,600,000 |
|
||||||||||
|
Lantern Cove |
|
Foster City, CA |
|
1985 |
|
232 |
|
6,945,000 |
|
23,332,206 |
|
— |
|
1,388,082 |
|
6,945,000 |
|
24,720,288 |
|
31,665,288 |
|
(5,084,132 |
) |
26,581,155 |
|
36,403,000 |
|
||||||||||
|
Legacy Park Central |
|
Concord, CA |
|
2003 |
|
259 |
|
6,469,230 |
|
46,745,854 |
|
— |
|
51,275 |
|
6,469,230 |
|
46,797,129 |
|
53,266,359 |
|
(4,349,725 |
) |
48,916,634 |
|
37,650,000 |
|
||||||||||
|
Mesa Del Oso |
|
Albuquerque, NM |
|
1983 |
|
221 |
|
4,305,000 |
|
12,160,419 |
|
— |
|
956,672 |
|
4,305,000 |
|
13,117,091 |
|
17,422,091 |
|
(3,112,304 |
) |
14,309,787 |
|
10,271,614 |
|
||||||||||
|
Schooner Bay I |
|
Foster City, CA |
|
1985 |
|
168 |
|
5,345,000 |
|
20,509,239 |
|
— |
|
1,544,185 |
|
5,345,000 |
|
22,053,424 |
|
27,398,424 |
|
(4,176,012 |
) |
23,222,412 |
|
27,000,000 |
|
||||||||||
|
Schooner Bay II |
|
Foster City, CA |
|
1985 |
|
144 |
|
4,550,000 |
|
18,142,163 |
|
— |
|
1,466,173 |
|
4,550,000 |
|
19,608,337 |
|
24,158,337 |
|
(3,668,252 |
) |
20,490,085 |
|
23,760,000 |
|
||||||||||
|
South Shore |
|
Stockton, CA |
|
1979 |
|
129 |
|
840,000 |
|
9,380,786 |
|
— |
|
1,287,382 |
|
840,000 |
|
10,668,168 |
|
11,508,168 |
|
(2,137,899 |
) |
9,370,269 |
|
6,833,000 |
|
||||||||||
|
Tierra Antigua |
|
Albuquerque, NM |
|
1985 |
|
148 |
|
1,825,000 |
|
7,841,358 |
|
— |
|
486,388 |
|
1,825,000 |
|
8,327,746 |
|
10,152,746 |
|
(2,016,718 |
) |
8,136,028 |
|
6,069,590 |
|
||||||||||
|
Waterfield Square I |
|
Stockton, CA |
|
1984 |
|
170 |
|
950,000 |
|
9,300,249 |
|
— |
|
1,789,096 |
|
950,000 |
|
11,089,345 |
|
12,039,345 |
|
(2,434,588 |
) |
9,604,757 |
|
6,923,000 |
|
||||||||||
|
Waterfield Square II |
|
Stockton, CA |
|
1984 |
|
158 |
|
845,000 |
|
8,657,988 |
|
— |
|
1,385,043 |
|
845,000 |
|
10,043,031 |
|
10,888,031 |
|
(2,075,145 |
) |
8,812,887 |
|
6,595,000 |
|
||||||||||
|
Willow Brook (CA) |
|
Pleasant Hill, CA |
|
1985 |
|
228 |
|
5,055,000 |
|
38,387,297 |
|
— |
|
826,020 |
|
5,055,000 |
|
39,213,317 |
|
44,268,317 |
|
(4,582,228 |
) |
39,686,090 |
|
29,000,000 |
|
||||||||||
|
Willow Creek |
|
Fresno, CA |
|
1984 |
|
116 |
|
275,000 |
|
6,639,018 |
|
— |
|
800,517 |
|
275,000 |
|
7,439,535 |
|
7,714,535 |
|
(1,605,882 |
) |
6,108,654 |
|
5,112,000 |
|
||||||||||
|
EQR Partially Owned Encumbered |
|
|
|
|
|
4,390 |
|
64,181,091 |
|
367,771,269 |
|
— |
|
28,773,904 |
|
64,181,091 |
|
396,545,174 |
|
460,726,265 |
|
(71,727,221 |
) |
388,999,044 |
|
361,343,204 |
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Portfolio/Entity Encumberances (1) |
|
|
|
|
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
893,451,149 |
|
||||||||||
|
Total Consolidated Investment in Real Estate |
|
|
|
|
|
151,315 |
|
$ |
3,557,871,695 |
|
$ |
12,601,516,504 |
|
$ |
— |
|
$ |
1,075,786,914 |
|
$ |
3,557,871,695 |
|
$ |
13,677,303,418 |
|
$ |
17,235,175,113 |
|
$ |
(3,022,479,795 |
) |
$ |
14,212,695,318 |
|
$ |
3,178,223,172 |
|
(1) See attached Encumberances Reconciliation
S-10
EQUITY RESIDENTIAL
Schedule III - Real Estate and Accumulated Depreciation
December 31, 2006
NOTES:
|
(A) |
The balance of furniture & fixtures included in the total investment in real estate amount was $812,552,035 as of December 31, 2006. |
|
(B) |
The aggregate cost for Federal Income Tax purposes as of December 31, 2006 was approximately $10.2 billion. |
|
(C) |
The life to compute depreciation for building is 30 years, for building improvements ranges from 5 to 10 years, for furniture & fixtures and replacements is 5 years, and for in-place leases is the average remaining term of each respective lease. |
|
(D) |
This asset consists of various acquisition dates and largely represents furniture, fixtures and equipment, leasehold improvements and capitalized software costs owned by the Management Business, which are generally depreciated over periods ranging from 3 to 7 years. |
|
(E) |
Primarily represents capital expenditures for major maintenance and replacements incurred subsequent to each property’s acquisition date. |
|
(F) |
Represents land, construction-in-progress and/or miscellaneous pursuit costs on projects either held for future development or projects currently under development. |
|
(G) |
A portion or all of these properties includes commercial space (retail, parking and/or office space). |
|
(H) |
These three properties are pledged as additional collateral in connection with various tax-exempt bond financings. |
|
(I) |
Total properties and units exclude both the Partially Owned Properties - Unconsolidated consisting of 45 properties and 10,846 units, and the Military Housing (Fee Managed) consisting of one property and 3,555 units. |
|
(J) |
This asset has a new construction loan outstanding but no amounts had yet been drawn as of December 31, 2006. |
S-11
EXHIBIT INDEX
The exhibits listed below are filed as part of this report. References to exhibits or other filings under the caption “Location” indicate that the exhibit or other filing has been filed, that the indexed exhibit and the exhibit referred to are the same and that the exhibit referred to is incorporated by reference. The Commission file number for our Exchange Act filings referenced below is 1-12252.
|
Exhibit |
|
Description |
|
Location |
|
3.1 |
|
Articles of Restatement of Declaration of Trust of Equity Residential dated December 9, 2004. |
|
Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2004. |
|
|
|
|
|
|
|
3.2 |
|
Fifth Amended and Restated Bylaws of Equity Residential dated December 9, 2004. |
|
Included as an exhibit to the Company’s Form 8-K dated December 9, 2004, filed on December 10, 2004. |
|
|
|
|
|
|
|
4.1 |
|
Indenture, dated October 1, 1994, between the Operating Partnership, as obligor and The First National Bank of Chicago, as trustee (“Indenture”). |
|
Included as an exhibit to the Operating Partnership’s Form 10/A, dated December 12, 1994, File No. 0-24920. |
|
|
|
|
|
|
|
4.2 |
|
First Supplemental Indenture to Indenture, dated as of September 9, 2004. |
|
Included as an exhibit to the Operating Partnership’s Form 8-K, filed on September 10, 2004. |
|
|
|
|
|
|
|
4.3 |
|
Description of 7 5/8% Notes due April 15, 2007. |
|
Contained in 424B2 Prospectus Filing of Evans Withycombe Residential, Inc. dated March 28, 1997. |
|
|
|
|
|
|
|
4.4 |
|
Form of 6.9% Note due August 1, 2007. |
|
Included as an exhibit to Form 8-K of Merry Land & Investment Company, Inc., filed on July 29, 1997. |
|
|
|
|
|
|
|
4.5 |
|
Form of 4.861% Note due November 30, 2007. |
|
Included as an exhibit to the Operating Partnership’s Form 8-K, filed on November 20, 2002. |
|
|
|
|
|
|
|
4.6 |
|
Form of 4.75% Note due June 15, 2009. |
|
Included as an exhibit to the Operating Partnership’s Form 8-K, filed on June 4, 2004. |
|
|
|
|
|
|
|
4.7 |
|
Terms Agreement regarding 6.95% Notes due March 2, 2011. |
|
Included as an exhibit to the Operating Partnership’s Form 8-K, filed on March 2, 2001. |
|
|
|
|
|
|
|
4.8 |
|
Terms Agreement regarding 6.625% Notes due March 15, 2012. |
|
Included as an exhibit to the Operating Partnership’s Form 8-K, filed on March 14, 2002. |
|
|
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4.9 |
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Form of 5.2% Note due April 1, 2013. |
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Included as an exhibit to the Operating Partnership’s Form 8-K, filed on March 19, 2003. |
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Exhibit |
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Description |
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Location |
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4.10 |
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Form of 5.25% Note due September 15, 2014. |
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Included as an exhibit to the Operating Partnership’s Form 8-K, filed on September 10, 2004. |
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4.11 |
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Terms Agreement regarding 6.63% (subsequently remarketed to a 6.584% fixed rate) Notes due April 13, 2015. |
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Included as an exhibit to the Operating Partnership’s Form 8-K, filed on April 13, 1998. |
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4.12 |
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Terms Agreement regarding 7 1/8% Notes due October 15, 2017. |
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Included as an exhibit to the Operating Partnership’s Form 8-K, filed on October 9, 1997. |
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4.13 |
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Terms Agreement regarding 7.57% Notes due August 15, 2026. |
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Included as an exhibit to the Operating Partnership’s Form 8-K, filed on August 13, 1996. |
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4.14 |
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Terms Agreement regarding 5.125% Notes due March 15, 2016. |
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Included as an exhibit to the Operating Partnership’s Form 8-K, filed on September 13, 2005. |
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4.15 |
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Form of 5.375% Note due August 1, 2016. |
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Included as an exhibit to the Operating Partnership’s Form 8-K, dated January 11, 2006, filed on January 18, 2006. |
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4.16 |
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Form of 3.85% Exchangeable Senior Note due August 15, 2026. |
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Included as an exhibit to the Operating Partnership’s Form 8-K, dated August 16, 2006, filed August 23, 2006. |
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10.1 |
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Fifth Amended and Restated Agreement of Limited Partnership of ERP Operating Limited Partnership. |
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Included as an exhibit to the Operating Partnership’s Form 8-K/A dated July 23, 1998, filed on August 18, 1998. |
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10.2 |
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Master Amendment to Other Securities Term Sheets and Joinders to Operating Partnership Agreement of ERP Operating Limited Partnership dated December 19, 2003. |
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Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2003. |
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10.3 |
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Assignment and Assumption Agreement between the Company and ERP Operating Limited Partnership dated December 19, 2003. |
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Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2003. |
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10.4* |
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Noncompetition Agreement (Zell). |
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Included as an exhibit to the Company’s Form S-11 Registration Statement, File No. 33-63158. |
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10.5* |
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Noncompetition Agreement (Spector). |
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Included as an exhibit to the Company’s Form S-11 Registration Statement, File No. 33-63158. |
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10.6* |
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Form of Noncompetition Agreement (other officers). |
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Included as an exhibit to the Company’s Form S-11 Registration Statement, File No. 33-63158. |
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Exhibit |
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Description |
|
Location |
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10.7 |
|
Amended and Restated Master Reimbursement Agreement, dated as of November 1, 1996 by and between Federal National Mortgage Association and EQR-Bond Partnership. |
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Included as an exhibit to the Company’s Form S-11 Registration Statement, File No. 33-63158. |
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10.8 |
|
Revolving Credit Agreement dated as of April 1, 2005 among ERP Operating Limited Partnership, Bank of America, N.A., as administrative agent, JP Morgan Chase Bank, N.A., as syndication agent, J.P. Morgan Securities Inc. and Banc of America Securities LLC, as joint lead arrangers and joint book runners, Commerzbank AG, New York and Grand Cayman Branches, Wachovia Bank, National Association, Wells Fargo Bank, N.A., Suntrust Bank, and US Bank National Association, as co-documentation agents, and a syndicate of other banks (the “Credit Agreement”). |
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Included as an exhibit to the Company’s Form 8-K dated April 1, 2005, filed on April 4, 2005. |
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10.9 |
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Guaranty of Payment, made as of April 1, 2005, between Equity Residential and Bank of America, N.A., as administrative agent for the banks party to the Credit Agreement. |
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Included as an exhibit to the Company’s Form 8-K dated April 1, 2005, filed on April 4, 2005. |
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10.10 |
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Amended and Restated Limited Partnership Agreement of Lexford Properties, L.P. |
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Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 1999. |
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10.11* |
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The Equity Residential Advantage Retirement Savings Plan, restated effective January 1, 2004. |
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Attached herein. |
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10.12* |
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First Amendment to The Equity Residential Properties Advantage Retirement Savings Plan, dated April 25, 2005. |
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Attached herein. |
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10.13* |
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Second Amendment to Equity Residential Advantage Retirement Savings Plan, dated April 30, 2005. |
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Attached herein. |
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10.14* |
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Equity Residential 2002 Share Incentive Plan. |
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Included as an exhibit to the Company’s Form S-8 filed on January 21, 2003. |
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10.15* |
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First Amendment to Equity Residential 2002 Share Incentive Plan. |
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Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2004. |
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10.16* |
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Second Amendment to Equity Residential 2002 Share Incentive Plan. |
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Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2004. |
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10.17* |
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Third Amendment to Equity Residential 2002 Share Incentive Plan. |
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Included as an exhibit to the Company’s Form 10-Q for the quarterly period ended March 31, 2005. |
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10.18* |
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Fourth Amendment to Equity Residential 2002 Share Incentive Plan. |
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Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2005. |
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Exhibit |
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Description |
|
Location |
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10.19* |
|
Fifth Amendment to Equity Residential 2002 Share Incentive Plan. |
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Attached herein. |
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10.20* |
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Second Amendment to Equity Residential 1993 Share Option and Share Award Plan. |
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Attached herein. |
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10.21* |
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Form of Equity Residential Performance Based Unit Award Grant Agreement. |
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Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2004. |
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10.22* |
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Form of Change in Control Agreement between the Company and other executive officers. |
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Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2001. |
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10.23* |
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Form of Indemnification Agreement between the Company and each trustee and executive officer. |
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Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2003. |
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10.24* |
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Form of Executive Retirement Benefits Agreement. |
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Attached herein. |
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10.25* |
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Amended and Restated Executive Compensation Agreement between the Company and Samuel Zell dated March 5, 2003, but effective as of January 1, 2003. |
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Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2002. |
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10.26* |
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First Amendment to Amended and Restated Executive Compensation Agreement between the Company and Samuel Zell dated February 3, 2005. |
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Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2004. |
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10.27* |
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Second Amendment to Amended and Restated Compensation Agreement between the Company and Samuel Zell dated April 25, 2005. |
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Included as an exhibit to the Company’s Form 10-Q for the quarterly period ended March 31, 2005. |
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10.28* |
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Amended and Restated Deferred Compensation Agreement between the Company and Gerald A. Spector dated January 1, 2002. |
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Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2001. |
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10.29* |
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Retirement Benefits Agreement between Samuel Zell and the Company dated October 18, 2001. |
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Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2001. |
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10.30* |
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Severance Agreement (Change in Control) between the Company and Donna Brandin dated September 10, 2004. |
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Attached herein. |
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10.31* |
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Summary of Changes to Trustee Compensation. |
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Included as an exhibit to the Company’s Form 8-K dated September 21, 2005, filed on September 27, 2005. |
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10.32* |
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Equity Residential Supplemental Executive Retirement Savings Plan as Amended and Restated effective January 1, 2003. |
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Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2005. |
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10.33* |
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Amendment No. 1 to the Equity Residential Supplemental Executive Retirement Savings Plan. |
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Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2005. |
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10.34 |
|
Form of Lexford Housing Division Sale Agreement. |
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Included as an exhibit to the Company’s Form 10-Q for the quarterly period ended June 30, 2006. |
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Exhibit |
|
Description |
|
Location |
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12 |
|
Computation of Ratio of Earnings to Combined Fixed Charges. |
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Attached herein. |
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21 |
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List of Subsidiaries of Equity Residential. |
|
Attached herein. |
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23.1 |
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Consent of Ernst & Young LLP. |
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Attached herein. |
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24 |
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Power of Attorney. |
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Signature page to this report. |
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31.1 |
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Certification of David J. Neithercut, Chief Executive Officer. |
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Attached herein. |
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31.2 |
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Certification of Donna Brandin, Chief Financial Officer. |
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Attached herein. |
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32.1 |
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Certification Pursuant to 18 U.S.C. Section 1350, as adopted, pursuant to Section 906 of the Sarbanes–Oxley Act of 2002, of David J. Neithercut, Chief Executive Officer of the Company. |
|
Attached herein. |
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32.2 |
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Certification Pursuant to 18 U.S.C. Section 1350, as adopted, pursuant to Section 906 of the Sarbanes–Oxley Act of 2002, of Donna Brandin, Chief Financial Officer of the Company. |
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Attached herein. |
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* Management contracts and compensatory plans or arrangements filed as exhibits to this report are identified by an asterisk.
Exhibit 10.11
THE EQUITY RESIDENTIAL
ADVANTAGE RETIREMENT SAVINGS PLAN
(Restated Effective January 1, 2004)
Table of Contents
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Page |
|
Article 1 INTRODUCTION |
1 |
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1.01 |
1 |
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1.02 |
1 |
|
Article 2 DEFINITIONS |
2 |
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2.01 Account |
2 |
|
2.02 Act |
2 |
|
2.03 Authorized Leave of Absence |
2 |
|
2.04 Beneficiary |
2 |
|
2.05 Break in Service |
2 |
|
2.06 Code |
3 |
|
2.07 Committee |
3 |
|
2.08 Company |
3 |
|
2.09 Compensation |
3 |
|
2.10 Credited Service |
3 |
|
2.11 Distribution |
4 |
|
2.12 Effective Date |
4 |
|
2.13 Employee |
4 |
|
2.14 Employee Contributions |
5 |
|
2.15 Employer |
5 |
|
2.16 Employer Contributions |
5 |
|
2.17 Entry Date |
5 |
|
2.18 Fiduciary |
5 |
|
2.19 Forfeiture |
5 |
|
2.20 Former Participant |
5 |
|
2.21 Fund |
5 |
|
2.22 Hour of Service |
5 |
|
2.23 Normal Retirement Date |
6 |
|
2.24 Participant |
6 |
|
2.25 Participating Employer |
6 |
|
2.26 Permanent Disability |
7 |
|
2.27 Plan |
7 |
|
2.28 Plan Year |
7 |
|
2.29 Postponed Retirement Date |
7 |
|
2.30 Prior Plan |
7 |
|
2.31 Qualified Domestic Relations Order (QDRO) |
7 |
|
2.32 Qualified Matching Contribution (QMAC) |
7 |
|
2.33 Qualified Military Service |
7 |
|
2.34 Qualified Non-Elective Contribution (QNEC) |
7 |
|
2.35 Recordkeeper |
7 |
|
2.36 Related Employer |
7 |
|
2.37 Related Plan |
8 |
|
2.38 Retirement |
8 |
|
2.39 Rollover Contribution |
8 |
|
|
Page |
|
2.40 Termination of Employment |
8 |
|
2.41 Trust or Trust Agreement |
8 |
|
2.42 Trustee |
8 |
|
2.43 Valuation Date |
8 |
|
2.44 Rules of Construction |
8 |
|
Article 3 PARTICIPATION |
9 |
|
3.01 Participation |
9 |
|
3.02 Participation and Rehire |
10 |
|
3.03 No Contract for Employment |
10 |
|
Article 4 CONTRIBUTIONS |
11 |
|
4.01 Pre-Tax Contributions |
11 |
|
4.02 Suspension of Pre-Tax Contributions |
13 |
|
4.03 Employer Profit Sharing Contributions |
13 |
|
4.04 Employer Matching Contributions |
14 |
|
4.05 Qualified Matching Contributions |
15 |
|
4.06 Qualified Non-Elective Contributions |
15 |
|
4.07 Payment of Contributions |
15 |
|
4.08 Limitations on Contributions |
16 |
|
4.09 Rollover Contributions |
19 |
|
Article 5 ACCOUNTS AND ALLOCATIONS |
20 |
|
5.01 Participant Accounts |
20 |
|
5.02 Investment Directives |
21 |
|
5.03 Valuation |
22 |
|
5.04 Value of Account for Purposes of Distribution |
22 |
|
5.05 Expenses |
23 |
|
5.06 Voting of Employer Stock |
23 |
|
5.07 Errors |
23 |
|
5.08 Allocations Do Not Affect Vesting |
23 |
|
5.09 Limitations on Allocations |
23 |
|
Article 6 DISTRIBUTION AND VESTING |
24 |
|
6.01 Normal Retirement |
24 |
|
6.02 Postponed Retirement |
24 |
|
6.03 Permanent Disability |
24 |
|
6.04 Distribution Upon Death |
24 |
|
6.05 Termination of Employment |
25 |
|
6.06 Disposition of Forfeitures |
26 |
|
6.07 Valuation and Timing of Distribution |
27 |
|
6.08 Method of Distribution |
29 |
|
6.09 Withdrawal of Accounts |
30 |
|
6.10 Payment to Minors and Incapacitated Persons |
32 |
|
6.11 Missing Persons |
32 |
|
6.12 Application for Benefits |
33 |
|
6.13 Beneficiary |
33 |
|
|
Page |
|
6.14 Loans To Participants |
34 |
|
6.15 Qualified Domestic Relations Orders |
38 |
|
6.16 Special Distribution Rules |
39 |
|
Article 7 ADMINISTRATION OF THE PLAN |
43 |
|
7.01 Named Fiduciaries |
43 |
|
7.02 Company |
44 |
|
7.03 Trustee |
44 |
|
7.04 Plan Administrator |
44 |
|
7.05 Standard of Fiduciary Duty |
46 |
|
7.06 Claims Procedure |
46 |
|
Article 8 AMENDMENT AND TERMINATION |
47 |
|
8.01 Right to Amend |
47 |
|
8.02 Termination and Discontinuance of Contributions |
48 |
|
Article 9 MISCELLANEOUS |
50 |
|
9.01 Headings |
50 |
|
9.02 Action by Employer |
50 |
|
9.03 Spendthrift Clause |
50 |
|
9.04 Discrimination |
50 |
|
9.05 Release |
50 |
|
9.06 Compliance with Applicable Laws |
50 |
|
9.07 Agent for Service of Process |
50 |
|
9.08 Merger |
51 |
|
9.09 Governing Law |
51 |
|
9.10 Absence of Guarantee |
51 |
|
Article 10 TOP HEAVY RULES |
52 |
|
10.01 General Rule |
52 |
|
10.02 Definitions |
52 |
|
10.03 Minimum Allocation |
53 |
|
10.04 Nonforfeitability of Employer Top-Heavy Contribution |
53 |
|
10.05 Vesting |
54 |
Article 1
INTRODUCTION
1.01 Equity Residential, a Maryland real estate trust (the “Company”) established a Profit Sharing Plan and Trust effective January 1, 1995, known as the Equity Residential Properties Trust Advantage Retirement Savings Plan.
Effective January 1, 2001, Lexford Residential Trust (“Lexford”) and Grove Property Trust (“Grove”) was merged into the Company and the employees of Lexford who participated in the Lexford Residential Trust Savings Plan (the “Lexford Plan”) and the employees of Grove who participated in the Grove Property Trust 401(k) Retirement Plan (the “Grove Plan”) began participating in this Plan. Effective July 1, 2001, Globe Business Resources, Inc. (“Globe”), and the employees of Globe who participated in the Globe Business Resources, Inc. 401(k)/Profit-Sharing Plan (the “Globe Plan”) began participating in this Plan. The Lexford Plan and Grove Plan were merged into this Plan effective January 1, 2001, and the Globe Plan was merged into this Plan on August 1, 2001. Effective as of December 31, 2001, two frozen plans previously maintained by subsidiaries of the Company, the Cardinal Industries, Inc. Retirement Plan (the “Cardinal Plan”), and the Equity Hotel Savings Trust (the “Hotel Trust”) were merged into the Plan.
The Company hereby amends and restates the Plan to comply with recent legislation, to incorporate previous amendments, to delete obsolete provisions, and to make other administrative, technical and conforming changes. The restatement of the Plan is generally effective as of January 1, 2004, except as specifically stated otherwise in this Plan document.
The Plan was established on a qualified basis, and shall be maintained in such manner as will continue to meet the applicable qualification requirements of Section 401 of the Internal Revenue Code of 1986, as amended, and the Employee Retirement Income Security Act of 1974, as amended. Anything else contained herein to the contrary notwithstanding, any provision of this amendment and restatement of the Plan which is required to have an effective date earlier than January 1, 2004, in order to preserve the qualified status of the Plan under Section 401 shall be effective as of such date. In the case of a plan that has been merged into the Plan, any such provision which has an effective date prior to the date of merger, shall apply to such plan, and shall govern the rights of participants in such plan, during the period between such effective date and the date of merger.
1.02 The purpose of this Plan is to provide the benefits of a qualified combined profit sharing and cash or deferred arrangement that is funded, insofar as the law permits, through pre-tax salary reduction contributions and Employer contributions, for the exclusive benefit of the Participants and their Beneficiaries; and this Plan shall be administered and interpreted in accordance with such purpose. For purposes of Section 401(a)(27) of the Code, the Plan is a profit sharing plan.
2
Article 2
DEFINITION
Certain terms of this Plan have defined meanings which are set forth in this Article and which shall govern unless the context in which they are used clearly indicates that some other meaning is intended.
2.01 Account shall mean the total Account established and maintained by the Plan Administrator or Trustee for each Participant, Former Participant, or their Beneficiaries, to which shall be allocated the Participant’s interest, if any, in the Fund. Each Account shall be comprised of the sub-accounts described in Section 5.01.
2.02 Act shall mean Public Law No. 93-406, the Employee Retirement Income Security Act of 1974, as the same has been and may be amended from time to time.
2.03 Authorized Leave of Absence shall mean any absence authorized by an Employer under the Company’s leave of absence policies, provided that all persons under similar circumstances must be treated alike in the granting of such Authorized Leaves of Absence and provided further that the Participant returns within the period of authorized absence. Once approved, a Leave of Absence begins on the first day the employee is absent from work. An absence covered under the Family Medical Leave Act shall be considered an authorized Leave of Absence provided that the Employee returns to employment with an Employer within the period provided by law. A period of Qualified Military Service (as hereinafter defined) shall also be considered an Authorized Leave of Absence. In other cases, the maximum length of an Authorized Leave of Absence is 26 weeks.
A period of Authorized Leave of Absence shall not be considered a Break in Service. Employees will continue to accrue hours of Credited Service for the number of hours for which they receive compensation while on leave, or for any period of Qualified Military Service. A person on Authorized Leave of Absence who does not return to employment with an Employer or a Related Employer when such Authorized Leave has expired will be considered to have a Termination of Employment as defined in the leave policies of the Company.
2.04 Beneficiary shall mean any person or persons entitled to benefits under the Plan upon the death of a Participant, as determined under Section 6.13.
2.05 Break in Service refers to a Plan Year in which an Employee has 500 or fewer Hours of Service. Solely for purposes of determining whether the Employee has incurred a Break in Service, an Employee who is on a Leave of Absence by reason of: (i) the pregnancy of the Employee; (ii) the birth of a child of the Employee; (iii) the placement of a child with the Employee in connection with the adoption of the child by the Employee; or (iv) caring for a child referred to in (ii) and (iii) above immediately following such birth or placement, shall be credited with Hours of Service for such Absence. Hours of Service shall be credited for such Absence at the rate of ten (10) hours per day, or forty-five (45) hours per week, but no more than 501 hours shall be credited for such Absence in any Plan Year. Such Hours of Service shall be credited for the Plan Year in which such Absence occurs if necessary to prevent a Break in Service for that
3
Plan Year; otherwise such Hours of Service shall be credited in the next following Plan Year, but only if necessary to prevent a Break in Service for that Plan Year.
2.06 Code shall mean the Internal Revenue Code of 1986, as amended from time to time.
2.07 Committee shall mean the Administrative Committee, if any, appointed by the Company under Article 7 to oversee the administration of the Plan.
2.08 Company shall mean Equity Residential Properties Trust, a Maryland real estate trust, and its successors. The Company shall be the Plan Sponsor.
2.09 Compensation shall mean the total cash compensation of each Participant (but only while a Participant) paid by the Employer during any Plan Year, including bonuses (except as provided below), overtime pay and commissioned earnings, and before reductions for salary reduction contributions contributed to this Plan, to a cafeteria plan under Section 125 of the Code, or to a qualified transportation fringe benefit policy under Section 132(f) of the Code. Compensation shall not include (i) relocation pay or related payments; (ii) severance pay; (iii) the rental value of apartments provided to the resident managers of the rental properties of any Employer; (iv) disposition of incentive stock options; (v) miscellaneous compensation; (vi) non-qualified stock options; (vii) tips; or (viii) solely for purposes of Section 4.01, any hire or retention bonus or other bonus that is not a performance-based incentive bonus.
Any Employee’s Compensation for any Plan Year in excess of $170,000 (or such other amount provided pursuant to Section 401(a)(17) of the Code) shall be disregarded for all purposes under the Plan. Effective January 1, 2002, $200,000 shall be substituted for $170,000 in the preceding sentence. If an Employee receives Compensation from more than one Employer for a Plan Year, then his Compensation from all such Employers shall be aggregated for purposes of applying the limit of Section 401(a)(17) of the Code for that Plan Year. Commencing January 1, 1997, the rules requiring the aggregation of compensation paid to certain family members of Highly Compensated Employees as set forth in the Plan prior to the Effective Date shall no longer apply.
For purposes of determining the Compensation of any Participant employed by a Participating Employer for the Plan Year in which the Participating Employer first maintains the Plan, only Compensation earned on and after the effective date by which the Participating Employer becomes a Participating Employer (or, if later, the date the individual becomes a Participant) shall be counted under the Plan.
2.10 Credited Service shall mean the number of years of service used to determine a Participant’s vesting in Employer Contributions made pursuant to Sections 4.03 and 4.04, which shall be measured in accordance with the following rules:
(a) Subject to the other rules listed in this Section, an Employee shall receive one (1) year of Credited Service for any Plan Year during which he earns 1,000 or more Hours of Service for one or more Employers or Related Employers.
4
(b) An individual shall not receive any Credited Service for any period of employment during any Plan Year if he earns less than 1,000 Hours of Service for one or more Employers or Related Employers during such Plan Year.
(c) Except to the extent specifically provided in Schedule A hereto, Credited Service shall not include: Hours of Service worked for an entity prior to the earlier of (i) the date on which it adopted this Plan or (ii) the date on which it became a Related Employer.
(d) An individual shall not receive Credited Service for any period of employment which precedes a Break in Service, if:
(i) As of the first day of the Break in Service, the individual was not entitled to a vested benefit under Section 6.05; and
(ii) The duration of the Break in Service measured in years (complete months expressed as a fraction of a year) equals or exceeds five (5) years.
(e) Any Participant who ceases to be employed by an Employer but who remains employed with any Related Employer or any other entity to the extent provided in Schedule A, shall continue to earn Credited Service as though such employment was employment with an Employer for purposes of vesting under this Plan. Such employment also shall be considered as employment by an Employer for purposes of Section 2.40 and eligibility to receive benefits, but the contribution provisions of Article 4 shall not apply while he is not employed by an Employer, notwithstanding any Plan provisions to the contrary.
(f) An Employee’s Credited Service as of the Effective Date of the Plan shall not be less than the service accrued immediately prior to the Effective Date of the Plan.
2.11 Distribution shall mean payment by the Trustee to or for the benefit of a Participant, Beneficiary or other person entitled to benefits as provided in this Plan.
2.12 Effective Date shall mean January 1, 2004. Effective Date of the Plan shall mean January 1, 1995.
2.13 Employee shall mean any person engaged in rendering personal services to and under the control or supervision of an Employer and who is receiving or accruing compensation from an Employer therefor, including any person on Authorized Leave of Absence; but excluding any person whose terms of employment are governed by the provisions of a collective bargaining agreement with respect to which retirement benefits were the subject of good faith negotiations, unless such agreement provides for such person’s coverage under the Plan, and any person who is an independent contractor.
A Leased Employee shall not be considered an Employee, but a Leased Employee who is subsequently hired as an Employee shall be entitled to Credited Service for the period spent as a Leased Employee to the extent required by Section 414(n) of the Code and the regulations thereunder, a Leased Employee who is subsequently employed as an Employee shall be treated as an Employee. For this purpose, a “Leased Employee” means any individual who is not an Employee and who provides services for the Employer if: (i) such services are provided
5
pursuant to an agreement between the Employer and any other person; (ii) such individual has performed such services for the Employer (or a related person within the meaning of Section 144(a)(3) of the Code) on a substantially full-time basis for a period of at least one year; and (iii) effective January 1, 1997, such services are performed under the primary direction and control of the Employer.
2.14 Employee Contributions shall mean contributions made or elected to be made by or on behalf of a Participant to the Plan as required or permitted under Section 4.01 of the Plan, as from time to time in effect.
2.15 Employer shall mean the Company and/or any Participating Employer, and any successors or assigns of the Company or of any Participating Employer. Each Employer shall bear the costs of contributions and may also bear the costs of reasonable administrative expenses under the Plan for its Employees.
2.16 Employer Contributions shall refer to the Employer Profit Sharing Contributions made under Section 4.03 and the Employer Matching Contributions made under Section 4.04, and may refer to Qualified Matching Contributions under Section 4.05 or Qualified Non-elective Contributions under Section 4.06, to the extent such Contributions are made to satisfy the tests set forth in Section 4.08.
2.17 Entry Date shall mean the first day of each payroll period in each Plan Year.
2.18 Fiduciary shall mean any party named as a Fiduciary in Article 7 of the Plan. Any party shall be considered a Fiduciary of the Plan only to the extent of any powers and duties specifically allocated to such party under the Plan which are in the nature of fiduciary powers within the scope of Section 3(2l) of the Act.
2.19 Forfeiture shall mean the cancellation and treatment of the non-vested portion of a Participant’s Account in accordance with Section 6.06.
2.20 Former Participant shall mean an individual who has had a Termination of Employment, and who was not thereafter re-employed, but who has not received a complete Distribution of his Account.
2.21 Fund shall mean the money and other properties held and administered by the Trustee in accordance with the Plan and Trust Agreement.
2.22 Hour of Service shall mean:
(a) Each hour for which an Employee is paid, or entitled to payment, for his performance of duties for an Employer or Related Employer.
(b) Each hour for which an Employee is paid, or entitled to payment, by an Employer or a Related Employer, on account of a period of time during which he performs no duties (irrespective of whether the employment relationship is terminated) due to vacation, holiday, illness, incapacity, layoff, jury duty, or leave of absence; provided that no Employee shall
6
receive credit for more than 501 Hours of Service for any single continuous period of nonworking time, except for an Employee in Qualified Military Service.
(c) Each hour for which back pay, irrespective of mitigation of damages, is either awarded or agreed to by an Employer or Related Employer with respect to an Employee.
The following rules shall apply in the determination of whether an Employee completes an Hour of Service:
(i) The same hours shall not be credited under subparagraphs (a) or (b) above, as the case may be, and subparagraph (c) above;
(ii) The rules relating to determining Hours of Service for reasons other than the performance of duties and for crediting Hours of Service to particular periods of continuous employment shall be those rules stated in U.S. Department of Labor regulations 2530.200b-2(b) and (c), respectively.
(iii) In determining Hours of Service an Employee who is employed by an Employer on other than an hourly rated basis shall be credited with ten (10) hours per day, or forty-five (45) hours per week for each day or week the Employee would, if hourly rated, be credited with Service pursuant to Subsection 2.22(a).
2.23 Normal Retirement Date shall mean the date a Participant reaches age sixty-five (65). Each Participant who attains his Normal Retirement Date while actively employed shall become one hundred percent (100%) vested in his Account as of such Date, regardless of his years of Credited Service.
2.24 Participant shall mean an Employee who becomes eligible to participate in the Plan as provided in Section 3.01, and shall also include an Employee who has made a Rollover Contribution, but only for purposes of such Contribution.
2.25 Participating Employer shall mean any corporation, partnership or trust that adopts this Plan and agrees to be governed by the terms and provisions of this Plan and to participate herein. Upon the adoption of this Plan by a Participating Employer, its employees shall be considered as Employees for all purposes of this Plan effective as of the date of adoption, or as of such earlier date as is specified in the resolution of adoption. No Participating Employer shall be permitted to become a Participating Employer without the consent of the Company. The Participating Employer status of any corporation, partnership or trust shall cease as of the effective date specified in a resolution of the Company which revokes such status. If any Participating Employer so ceases to participate hereunder, such event shall not constitute a partial or complete termination of the Plan except as otherwise provided under the circumstances by applicable law. The Participating Employers shall be those entities set forth on Schedule B hereto as in effect from time to time.
2.26 Permanent Disability shall mean a physical or mental condition which, based upon medical reports and other evidence satisfactory to the Plan Administrator, presumably permanently prevents an Employee from satisfactorily performing his usual duties for his
7
Employer or the duties of such other position or job which his Employer makes available to him and for which such Employee is qualified by reason of his training, education or experience.
2.27 Plan shall mean The Equity Residential Properties Trust Advantage Retirement Savings Plan, as in effect from time to time, including any amendment or restatement thereof.
2.28 Plan Year shall mean the calendar year.
2.29 Postponed Retirement Date shall mean a date following a Participant’s Normal Retirement Date on which he actually terminates his employment.
2.30 Prior Plan shall mean a defined contribution retirement plan that has been merged into the Plan or from which account balances have been transferred in a direct trust-to-trust transfer, including the Lexford Plan, the Grove Plan, the Globe Plan, the Cardinal Plan, the Hotel Trust, and the Wellsford Residential Property Trust 401(k) Profit Sharing Plan.
2.31 Qualified Domestic Relations Order (QDRO) shall mean (1) a qualified domestic relations order, as defined in Section 414(p) of the Code and Section 206(d) of the Act, entered after December 31, 1984, or (2) a domestic relations order, entered before January 1, 1985.
2.32 Qualified Matching Contribution (QMAC) shall mean an additional contribution made by the Employer in order to satisfy the requirements of Section 4.08. This contribution shall be treated as designated in Section 4.05.
2.33 Qualified Military Service shall mean a period of time during which an Employee is serving in the armed forces of the United States provided that the Employee has reemployment rights under the Uniformed Services Employment and Reemployment Rights Act of 1994 (or other applicable federal law) and returns to employment during the period in which his reemployment rights are protected. Wherever this Plan provides for additional contributions to be made on behalf of a Participant who returns after Qualified Military Service, such contributions shall be treated for purposes of all annual limitations on contributions as having been made in the Plan Year for which they would have been made but for the Qualified Military Service, shall be based on the Compensation the Participant would have earned had he been employed during the period of Qualified Military Service, shall not be credited with any earnings, gains or losses until actually made, and shall in all other respects be made in a manner consistent with Code Section 414(u) and the regulations thereunder.
2.34 Qualified Non-Elective Contribution (QNEC) shall mean an additional contribution made by the Employer in order to satisfy the requirements of Section 4.08. This contribution shall be treated as designated in Section 4.06.
2.35 Recordkeeper shall mean the person(s), corporation(s), associations(s), or a combination of them, whose duties include the tracking and updating of account values for participants, the tracking of plan activities and total plan balances and other similar duties.
2.36 Related Employer shall mean (i) any corporation that is a member of a controlled group of corporations (as defined in Section 414(b) of the Code) that includes any Employer; (ii) any trade or business (whether or not incorporated) that is under common control (as defined in
8
Section 414(c) of the Code) with any Employer, (iii) any member of an affiliated service group (as defined in Section 414(m) of the Code) that includes any Employer, and (iv) any other entity required to be aggregated with any Employer under regulations pursuant to Section 414(o) of the Code. For purposes of Section 5.09, the meanings of (i) and (ii) shall be as modified by Section 415(h) of the Code. The Related Employers shall be those Employers set forth on Schedule B hereto as in effect from time to time.
2.37 Related Plan shall mean any other defined contribution plan (as defined in Section 415 of the Code) maintained by the Company or by a Related Employer.
2.38 Retirement shall mean the termination of employment of a Participant on his Normal or Postponed Retirement Date.
2.39 Rollover Contribution shall mean contributions made by or on behalf of a Participant to the Plan pursuant to Section 4.09.
2.40 Termination of Employment shall mean that an Employee has ceased to be employed by the Employer and all Related Employers for any of the following reasons:
(i) Voluntary resignation from service;
(ii) Discharge from service;
(iii) Retirement;
(iv) Death;
(v) Permanent Disability; or
(vi) Loss of Employer or Related Employer status provided that distributions shall only be made as a result of such loss of status to the extent permitted by Section 401(k)(10) of the Code, or as provided in Section 6.05(b).
An Employee who ceases to be actively employed by reason of an Authorized Leave of Absence shall not be considered as having a Termination of Employment until the end of such Leave.
2.41 Trust or Trust Agreement shall mean the separate agreement of Trust entered into between the Company and the Trustee which governs the creation of the Fund, and all amendments thereto which may hereafter be made.
2.42 Trustee shall mean the person(s), corporation(s), association(s), or a combination of them, acting as Trustee under the Trust Agreement.
2.43 Valuation Date shall mean the last business day of the Plan Year. The Plan Administrator may designate additional Valuation Dates for the purposes of valuing the assets for (i) updating individual Participant Account Balances for Participant reporting (ii) performing transfers of account balances among investment funds for an individual Participant (iii)
9
processing withdrawals, loans and distributions for individual Participants and/or (iv) any other individual plan activity or reporting activity as deemed necessary by the Plan Administrator.
2.44 Rules of Construction . A defined term, such as “Retirement,” will normally govern the definitions of derivatives therefrom, such as “Retire,” even though such derivatives are not specifically defined and even if they are or are not initially capitalized. The masculine gender, where appearing in the Plan, shall be deemed to include the feminine gender, unless the context clearly indicates to the contrary. Singular and plural nouns and pronouns shall be interchangeable as the factual context may allow or require. The words “hereof,” “herein,” “hereunder” and other similar compounds of the work “here” shall mean and refer to the entire Plan and not to any particular provision or Section.
Article 3
PARTICIPATION
3.01 Participation.
(a) Employees who were eligible to participate in the Plan, or in the Grove Plan or Lexford Plan, on December 31, 2000, shall continue to be eligible to participate on the Effective Date.
(b) Except as otherwise provided below, any other individual who is an Employee on or after the Effective Date shall be eligible to participate in the Plan on any Entry Date on or after the date he becomes an Employee, provided he is still an Employee on such Entry Date. Persons who are Employees on December 31, 2000, but who were not previously eligible to participate because they had not yet completed a year of service as required prior to the Effective Date, shall be eligible to participate on the Effective Date.
(c) Any person who is retained to provide services for an Employer and who is classified by the Employer, whether or not pursuant to a written agreement with such person or his employer, as an independent contractor or as the employee of a third party, and who is subsequently determined to have been a common law employee of an Employer by any court or tax authority, shall not be eligible to participate in the Plan, but if such person subsequently becomes eligible to participate he shall receive credit for this Credited Service as a common law employee. The provisions of this subsection (c) are intended to clarify the eligibility requirements of the Plan as in effect since the Effective Date of the Plan, and nothing contained herein shall be construed to imply that such persons were previously eligible to participate.
(d) Any Employee who is a participant in an Advantage Retirement Savings Plan by virtue of employment with a company listed in Schedule A shall not be eligible to participate in this Plan.
(e) Any Employee who is covered by a collective bargaining agreement shall participate in the Plan only if explicitly so provided in the collective bargaining agreement, and any provisions of such collective bargaining agreement that provide for such Employees to participate on a basis different from other Employees shall be deemed incorporated into the Plan
10
and shall govern with respect to such Employees, to the extent not inconsistent with the tax qualified status of the Plan or other applicable law.
(f) Any Employee or former Employee of Cardinal Industries, Inc., or Reserve Square, Inc., whose account in the Cardinal Plan or Hotel Trust is transferred to this Plan as of December 31, 2001, shall be considered a Participant with respect to such transferred account only, and shall not be entitled to any additional allocations or contributions under this Plan, including the right to make a Rollover Contribution, unless such person becomes an eligible Employee as provided above.
(g) Any Employee who is a nonresident alien with no United States source income shall not be eligible to participate in the Plan.
3.02 Participation and Rehire.
(a) An Employee’s participation in the Plan shall continue until the Participant has a Termination of Employment. Any Participant who has a Termination of Employment shall cease to be a Participant and his benefits shall thereafter be governed by the provisions of Article 6.
(b) An Employee who was an eligible employee at the time of his Termination of Employment and who is subsequently rehired shall be eligible to begin or resume participation immediately.
3.03 No Contract for Employment . Participation in the Plan shall not give any Employee the right to be retained in the Employer’s employ, nor shall any Employee, upon dismissal from or voluntary termination of his employment, have any right or interest in the Fund, except as herein provided.
Article 4
CONTRIBUTIONS
4.01 Pre-Tax Contributions.
(a) For each Plan Year or portion thereof, each Employer shall contribute in cash amounts specified in salary reduction agreements made pursuant to this Section 4.01. A Participant may enter into a salary reduction agreement with his Employer pursuant to which he declines the salary reduction opportunity and elects not to contribute. The Participant may enter into a salary reduction agreement, in which he designates one to eighteen percent (1 to 18%), expressed in whole integers, of his Compensation subject to the limitations of this Article 4, be withheld and contributed on a pre-tax basis by his Employer to the Plan. Effective January 1, 2002, the maximum percentage that a Participant may agree to defer shall be increased from eighteen percent (18%) to fifty percent (50%).
(b) The Plan Administrator may modify the provisions governing the timing and effect of salary reduction agreements from time to time in a manner that is not discriminatory in favor of Highly Compensated Employees. Without limiting the generality of the foregoing, the Plan Administrator may modify the time and manner in which salary reduction agreements may
11
be made and modified (including permitting agreements to be made or modified by voice response system or other electronic means), and may establish rules permitting Participant’s to specify particular paychecks to which his elected salary reduction shall or shall not apply (and, in such case, the percentage limitation described above shall be applied to the aggregate Compensation of the Participant instead of the Compensation covered by each specific paycheck). Absent such direction, the elected percentage shall apply equally to each paycheck covered by the salary reduction agreement. Such election to be valid shall be in conformance with the form and procedure specified by the Plan Administrator.
(c) Any former participant in the Lexford Plan or Grove Plan who does not make a different election shall be deemed to have elected to have the same percentage withheld from his Compensation under this Plan as the last election in effect under the Lexford Plan or Grove Plan prior to the Effective Date (but subject to the maximum percentage permitted under this Plan). The Plan Administrator may provide for other situations, including future acquisitions, in which Employees will be deemed to have made salary reduction agreements, consistent with all applicable laws.
(d) A salary reduction agreement, whether it is for a specific paycheck or a regular salary reduction agreement, shall be deemed to be entered into by an Employee on the date on which a properly completed and executed agreement is received by the Plan Administrator. Properly completed agreements must be received by the Plan Administrator before the cut-off dates established for the processing of salary reduction agreements.
(e) If a Participant’s Compensation rate changes while he has a salary reduction agreement in effect under this Section the elected percentage shall continue to apply to the new compensation rate, subject to applicable limitations.
(f) Effective as of the first day of each payroll period, a Participant may change the percentage of Compensation designated for contribution under his salary reduction agreement, subject to the limitations of this Article 4. These changes must be received by the Plan Administrator before the cut-off dates established for the processing of salary reduction changes. The Plan Administrator may allow agreements to be entered orally or by other electronic means if confirmed in writing to the Participant. Unless so changed, or suspended under Section 4.02, a Participant’s salary reduction agreement shall continue in effect until the earlier of the Termination of Employment with his Employer or a termination of the Plan affecting him; provided, however, that the salary reduction agreement of a Participant who is transferred from employment with one Participating Employer to employment with another Participating Employer, without interruption, shall not be affected by such transfers and shall continue in effect thereafter as if entered into with his new Employer.
(g) No amount shall be contributed on behalf of any Participant under Section 4.01(a) in an amount which, when considered together with any Pre-Tax Contributions elected by such Participant and made on his behalf under any other qualified retirement plan having a cash or deferred arrangement in accordance with Section 401(k) of the Code, as amended (or any similar or successor provision of the Code), exceeds the amount set forth in the following table:
12
|
Plan Year |
|
Maximum Contribution |
|
|
2001 |
|
$ 10,500 |
|
|
2002 |
|
$ 11,000 |
|
|
2003 |
|
$ 12,000 |
|
|
2004 |
|
$ 13,000 |
|
|
2005 |
|
$ 14,000 |
|
|
2006 |
|
$ 15,000 |
|
|
After 2006 |
|
The limit in effect under Code Section 402(g) for the year |
|
Any Pre-Tax Contribution that would otherwise exceed the foregoing limitation for a Plan Year shall be distributed to the Participant, with the income allocable thereto, not later than April 15 of the following year. If the amount of a Participant’s Pre-Tax Contributions under this Plan does not exceed the foregoing limitation, but would cause the Participant’s total elective deferrals (as defined in Section 402(g) of the Code) for the year to exceed the foregoing limitation when added to the Participant’s elective deferrals under plans not maintained by a Related Employer, the Participant may notify the Plan Administrator and the amount designated by the Participant as necessary to comply with the foregoing limitation shall be distributed in accordance with the preceding sentence.
(h) Notwithstanding the foregoing, a Participant who returns to employment from Qualified Military Service will have the opportunity to make supplemental Pre-Tax Contributions to the Plan by increasing his rate of deferral over a make-up period, which shall begin on the date of his reemployment, shall be equal to three times the period of his Qualified Military Service, up to a maximum of five years. For purposes of all limitations on contributions under the Plan, such contributions shall be treated as having been made during the period of Qualified Military Service.
(i) In any Plan Year commencing on or after January 1, 2002, a Participant who has attained the age of 50 (or will attain the age of 50 by the last day of the Plan Year), and who is otherwise precluded from making additional Pre-Tax Contributions under any provision of this Plan, may enter into a supplemental salary reduction agreement to have his Employer make additional Pre-Tax Contributions (“Catch-Up Contributions”) in an amount not to exceed the lesser of his Compensation for the Plan Year reduced by all other Pre-Tax Contributions for the Plan Year or the dollar amount set forth in the following table:
13
|
Plan Year |
|
Maximum Contribution |
|
|
2002 |
|
$ 1,000 |
|
|
2003 |
|
$ 2,000 |
|
|
2004 |
|
$ 3,000 |
|
|
2005 |
|
$ 4,000 |
|
|
2006 |
|
$ 5,000 |
|
|
After 2006 |
|
The limit in effect under Code Section 414(v) for the year |
|
Catch-Up Contributions shall not be eligible for Employer Matching Contributions, and shall not be subject to any of the limitations on the amount of Contributions under this Plan, except for the limits set forth above in this Section 4.01(i). Except as otherwise provided in the preceding sentence, Catch-Up Contributions shall be considered Pre-Tax Contributions for all purposes of this Plan, including without limitation the rules governing the distribution of excess Pre-Tax Contributions set forth in Section 4.01(g), which shall be construed by substituting catch-up contributions subject to Section 414(v) of the Code for elective deferrals subject to Section 402(g). The Plan Administrator may adopt rules and procedures for implementing elections to make Catch-Up Contributions in accordance with Code Section 414(v).
4.02 Suspension of Pre-Tax Contributions.
(a) A Participant may voluntarily suspend Pre-Tax Contributions at any time by contacting the Plan Administrator. Suspensions will be effective as soon as administratively practical.
The earliest date a Participant may resume Pre-Tax Contributions after a suspension is on the first day of the first payroll period commencing on or after the Entry Date next following the effective date of such suspension of contributions, or any subsequent Entry Date thereafter. Resumptions must be received by the Plan Administrator before the cut-off dates established for the processing of salary reduction changes. The Plan Administrator may allow resumptions to be entered orally or by other electronic means, if confirmed in writing to the Participant.
(b) Pre-Tax Contributions shall be suspended automatically during periods in which Compensation is not payable to the absent Employee.
4.03 Employer Profit Sharing Contributions .
(a) Each Employer may make a contribution to the Plan for each Plan Year on behalf of each of the Participants who (i) have satisfied the eligibility requirements of subparagraphs (a) and (b) and (ii) who either (A) have completed 1,000 or more Hours of Service during the Plan Year and remains employed by the Employer as of December 31 of the Plan Year, or (B) who incurred a Retirement, died or had a Termination of Employment due to a Permanent Disability
14
during the Plan Year. In addition, each Employer may make an Employer Profit Sharing Contribution on behalf of each Participant who transferred from such Employer to a company listed on Schedule A provided that such Participant remained employed by such company as of his last scheduled work day of the Plan Year, or terminated such employment because he incurred a Retirement, died or had a termination of Employment due to a Permanent Disability during such Year. Such contribution, when made, shall be in an amount determined by the Employer and allocated based on a uniform percentage of the Compensation that each eligible Participant earned while both eligible to participate and employed by that Employer for the Plan Year. In addition, each Employer shall make a contribution on behalf of each Participant who returns from Qualified Military Service equal to the Employer Profit-Sharing Contributions that would have been allocated to such Participant’s Account had he been employed during the period of Qualified Military Service.
(b) A Participant will be eligible to share in the Employer Profit-Sharing Contributions beginning with the first payroll period after he has completed one full year as an Employee (counting service with Lexford or Grove or, to the extent so provided by the Plan Administrator, other employers acquired in the future). In the Plan Year in which he first becomes eligible, only Compensation earned after the payroll period in which he becomes eligible to share shall be counted for purposes of allocating his share of the Employer Profit-Sharing Contribution. An Employee whose employment is terminated before he is eligible to share in Employer Profit Sharing Contributions and is later re-hired must complete a year of employment after being rehired before becoming eligible. An Employee whose employment is terminated after he has become eligible to share in the Employer Profit-Sharing Contribution and who is subsequently rehired will be immediately eligible to share in Profit Sharing Contributions unless he incurred five (5) consecutive Breaks in Service, in which event he must complete a new year of employment after being rehired. An Employee who is transferred to a position in which he becomes eligible to share in Employer Profit Sharing Contribution after completing a year of employment in a position in which he is not eligible shall be immediately eligible, but based only on Compensation earned after the date of transfer.
(c) The amount of each Employer’s Profit-Sharing Contribution for each Plan Year shall be determined by the Board of Trustees or Directors of the Employer in its sole discretion, and shall not be limited to the Employer’s net profits. An Employer may also make separate Profit-Sharing Contributions (or no Profit-Sharing Contribution) on behalf of different groups of Participants who are employed by separate operating divisions, which shall be allocated only among such Participants. On or after January 1, 2002, Employer Profit-Sharing Contributions may be made by the Company on behalf of Participants who are employed by the division consisting of the operations purchased from the Lexford Residential Trust (the “Lexford Division”), and, effective January 1, 2002, Participants employed by the Lexford Division are eligible to participate in the Employer Profit-Sharing Contributions.
4.04 Employer Matching Contributions.
Each Employer shall make Employer Matching Contributions on behalf of each of the Participants who is eligible to participate in Employer Profit-Sharing Contributions for the Plan Year (regardless of whether any Employer Profit-Sharing Contributions are actually made by such Employer). In addition, each Employer shall make an Employer Matching Contribution on
15
behalf of each Participant who transferred from such Employer to a company listed on Schedule A provided that such Participant remained employed by such company as of his last scheduled work day of the Plan Year, or terminated such employment because he incurred a Retirement, died or had a Termination of Employment due to a Permanent Disability during such Year. Each Employer shall contribute on behalf of each such Participant an amount equal to the Participant’s Pre-Tax Contributions made while the Participant was employed by such Employer to the extent they do not exceed 2% of the Participant’s Compensation earned while the Participant was employed by such Employer for the Plan Year. In addition to the foregoing, each Employer shall make supplemental matching contributions with respect to any Participant returning from Qualified Military Service based upon the supplemental Pre-Tax Contributions the Participant elects to make pursuant to Section 4.01(h), equal to the amount of Employer Matching Contributions the Participant would have received had such Pre-Tax Contributions been made during his period of Qualified Military Service. Notwithstanding the foregoing, Employer Matching Contributions shall not be made to the Plan with respect to a Participant to the extent that such contributions would cause the limitations set forth in Section 4.08(d) to be exceeded for such Participant with respect to the year for which such contributions are made.
4.05 Qualified Matching Contributions . Each Employer may make an additional Employer Matching Contribution for purposes of satisfying the requirements of Section 4.08. Such contributions shall be made in amounts determined by each Employer (and approved by the Company) and allocated among Participants who are not members of the Highly Compensated Group (as defined in Section 4.08) as determined by the Company. These contributions shall be 100% vested and shall be treated as Employer Matching Contributions for purposes of Section 6.
4.06 Qualified Non-Elective Contributions . Each Employer may make an additional Employer Profit Sharing Contribution for purposes of satisfying the requirements of Section 4.08. Such contributions shall be made in amounts determined by each Employer (and approved by the Company) and allocated among Participants who are not members of the Highly Compensated Group (as defined in Section 4.08) in proportion to the relative Compensation that each eligible Participant earned while both eligible to participate and employed by that Employer for the Plan Year. These contributions shall be 100% vested and shall be treated as Employer Profit Sharing Contributions for purposes of Section 6.
4.07 Payment of Contributions.
(a) Pre-Tax Contributions (in an amount specified by the Participant pursuant to Section 4.01) shall be withheld by the Employer from the Participant’s Compensation and paid to the Trustee in cash as of the earliest date on which such Contributions can reasonably be segregated from the Company’s general assets, but not later than the 15th business day of the month following the month in which the Participant contributions were withheld. The Employer Contributions made under Section 4.03, 4.04, 4.05 and 4.06, respectively, shall be paid to the Trustee, in cash or in Employer stock, within the time for the Employer to obtain a federal income tax deduction for such payment following the end of the Plan Year, and such Contributions shall be credited, for purposes of allocating such Contributions, to the eligible Participants as of the end of the Plan Year for which they were made.
16
(b) All Employer Contributions (including, for purposes of this paragraph, Pre-Tax Contributions made pursuant to Section 4.01) shall be irrevocable, and shall never inure to the benefit of the Employer. All Employer Contributions shall be transferred to the Trustee to be used only in accordance with the provisions of the Plan. Neither such contributions, nor the income therefrom shall be used for, or diverted to, purposes other than the exclusive benefit of the Participants or their Beneficiaries under the Plan and contingently for defraying reasonable expenses of administering the Plan.
Notwithstanding the foregoing provisions of this Section, with respect to all contributions made under this Article 4 on or after the Effective Date of the Plan, the following conditions apply:
(i) all such contributions are conditioned on being deductible and shall be returned to the contributing Employer, to the extent a deduction for such contribution is disallowed, upon demand and within one year after such disallowance;
(ii) any such contribution made due to a mistake of fact shall be returned to the contributing Employer, upon demand and within one year after the contribution was made; and
4.08 Limitations on Contributions.
(a) Regardless of amounts which Participants contribute or elect to have contributed on their behalf under this Article 4, the total contributions made by an Employer under Sections 4.01, 4.03, 4.04, 4.05 and 4.06 in any taxable year of such Employer, taking into consideration contributions to other qualified retirement plans as well, shall not exceed the maximum amount deductible by such Employer under Section 404(a) of the Code, as amended from time to time, and regulations thereunder, nor shall the aggregate contributions made by all Employers to this Plan in any taxable year exceed the maximum amount deductible by such Employers in the aggregate or by a Related Employer.
(b) In no event shall an Employer make contributions for any Plan Year commencing with 1997 that would result in the deferral percentage of the Highly Compensated Group (as defined in this Section) exceeding the greater of (i) or (ii) below:
(i) the deferral percentage for all other Employees eligible to participate in the Plan for the immediately preceding Plan Year, multiplied by 1.25; or
(ii) Alternative Limit; the lesser of:
(1) the deferral percentage of all other Employees eligible to participate in the Plan for the immediately preceding Plan Year, plus two (2) whole percentage points; or
(2) the deferral percentage of all such other Employees, multiplied by 2.0.
17
(c) For purposes of Subsection (b), the deferral percentage of a group of Employees shall be the average of the ratios (calculated separately for each Employee in the group) of the Pre-Tax Contributions made under Sections 4.01 on behalf of each Employee for the Plan Year to the Employee’s compensation for the Plan Year. Such ratio for each Employee shall be known as his “individual deferral percentage.” Solely for the purposes of this Section (except Subsection (g)), compensation shall have the same meaning as in Section 415 of the Code: the Participant’s wages (including Pre-Tax Contributions), salaries, fees for professional service and other amounts for personal services actually rendered in the course of employment with an Employer maintaining the Plan. For any Plan Year commencing with 2001, the Plan Administrator may elect to substitute the current Plan Year for the immediately preceding Plan Year in Subsection (b)(ii)(1) for purposes of either Subsection (b), Subsection (d), or both. Such election shall be accomplished by the adoption by the Plan Administrator of a written resolution not later than the end of the period described in Section 401(b) of the Code with respect to such Plan Year, which shall be considered an amendment to the Plan and may be reversed for subsequent Plan Years only with the consent of the Internal Revenue Service.
(d) The Plan Administrator shall make certain that Employer Matching Contributions made under Section 4.04 satisfy the ACP test in a similar manner as the ADP test described under Subsection (b), to be applied as if Employer Matching Contributions were substituted for Pre-Tax Contributions for purposes of Subsection (b) above. If Employer Matching Contributions do not satisfy such test for a particular Plan Year, the Plan Administrator may elect to have them aggregated with Pre-Tax Contributions for this purpose. If the requirements of Subsection (b) would otherwise not be met for a Plan Year, the Plan Administrator shall elect, to the extent necessary:
(i) to have any excess Employer Matching Contributions made on behalf of members of the Highly Compensated Group distributed to the appropriate Participants for whom such excess contributions were made. Any such distribution of excess shall be made within 2-1/2 months after the close of the Plan Year to which it relates, or within such other time period as applicable law and regulations shall permit without causing the imposition of any applicable tax on excess contributions.
(ii) to make additional Qualified Matching Contributions or additional Qualified Non-Elective Contributions for the Plan Year on behalf of one or more Participants who are not members of the Highly Compensated Group. Once these additional Qualified Matching or Qualified Non-Elective Contributions have been allocated, the above tests shall be rerun, using the additional contributions to help satisfy either the ADP or ACP test, as appropriate.
(e) If a “Multiple Use of the Alternative Limitation,” as defined in Code Regulation Section 1.401(m)-2(b), occurs in a Plan Year beginning prior to January 1, 2002, then, notwithstanding any other provision of Subsection 4.08(b) or Subsection 4.08(d), the test in paragraph 4.08(b)(2) as applied to Employer Matching Contributions in Subsection 4.08(d) shall not be used to satisfy the requirements of this Section for Employer Matching Contributions in the same Plan Year that the test contained in paragraph 4.08(b)(2) is used to satisfy the
18
requirements of this Section with respect to Pre-Tax Contributions. If the preceding sentence shall be applicable for a Plan Year, then the Plan Administrator shall determine whether to use the test in paragraph 4.08(b)(2) to satisfy the requirements of this Subsection 4.08(d) with respect to Employer Matching Contributions, or to use the test in paragraph 4.08(b)(2) to satisfy the requirements of Subsection 4.08(b) with respect to Pre-Tax Contributions for such Plan Year. This subsection (e) shall no longer apply effective January 1, 2002.
(f) To the extent necessary to comply with the limitations set forth in Subsection (b), during such period as applicable law allows and after any adjustments under Section 5.07(b) the Plan Administrator shall refund to affected Participants in the Highly Compensated Group the excess contributions made under Section 4.01 for the Plan Year on behalf of some or all Participants in the Highly Compensated Group. For Plan Years beginning on or after January 1, 2002, an amount which would otherwise be required to be distributed to a Participant may be recharacterized as a Catch-Up Contribution to the extent the Participant is eligible to make Catch-Up Contributions for such year.
For Plan Years prior to 1997, the amount so refunded shall be determined for each Participant in the Highly Compensated Group by determining the maximum deferral percentage permitted for the Highly Compensated Group under Subsection (b) and then reducing the individual deferral percentage of those Participants in the Highly Compensated Group whose individual deferral percentage exceeds the maximum deferral percentage for the Highly Compensated Group. Such reduction shall be made in an amount of sufficient size to reduce the overall deferral percentage for the Highly Compensated Group to a level such that Subsection (b) shall be satisfied. The amount so refunded shall be determined on a step-down basis so that the individual deferral percentage of the affected Participant(s) who elected the highest individual deferral percentage shall be first lowered to the level of the affected Participant(s) who elected the next to the highest individual deferral percentage. If further overall reductions are required to achieve compliance with Subsection (b), both of the above Participants’ or groups of Participants’ individual deferral percentages will be lowered to the next highest level, and so on continuing until sufficient total reductions have occurred to achieve compliance with Subsection (b).
Starting with the 1997 Plan Year, the total amount to be refunded shall be determined by using the method described above, and such amount shall then be allocated among the Highly Compensated Participants in such manner that the deferral amount of the Highly Compensated Participant(s) who deferred the greatest amount shall be first lowered to the level of the Participant(s) who deferred the next greatest amount. If further overall reductions are required to achieve compliance with Subsection (b), both of the above Participants’ or groups of Participants’ deferral amounts will be reduced to the next greatest level, and so on continuing until sufficient total reductions have occurred to achieve compliance with Subsection (b).
Excess contributions, adjusted for earnings and losses, shall be refunded to the affected Highly Compensated Employees as soon as practicable. In no event, however, shall such excess contributions be left undistributed any later than the last day of the Plan Year following the Plan Year in which such excess contributions were made.
19
(g) Effective January 1, 1997, for all purposes of the Plan, the term “Highly Compensated Group” means a group, determined separately for each Plan Year, consisting of each Employee who is eligible to participate in the Plan and who:
(i) in the Plan Year or preceding Plan Year was a 5% owner (as defined in Section 416(i)(1)(B)(i) of the Code); or
(ii) in the preceding Plan Year, received compensation from one or more Employers in excess of the amount determined under the following table and (if the Plan Administrator so elects) was among the top 20% of all Employees when ranked in order of total compensation.
|
Determination Plan Year |
|
Compensation in Preceding Plan Year |
|
1997-2000 |
|
80,000 |
|
2001-2002 |
|
85,000 |
|
2003 |
|
90,000 |
|
After 2003 |
|
Indexed amount under Code Section 414(q) |
The determination of who is included within the “Highly Compensated Group” shall be made consistent with Section 414(q) of the Code. The Plan Administrator is authorized to utilize any elective or alternative method of determining Highly Compensated Employees and the election permitted by Treasury Regulation Section 1.414(q)-1T, A-14(b)(4), which is hereby provided for in the Plan.
For purposes of this Subsection (g), “compensation” shall have the meaning set forth in Section 415(c)(3) of the Code. For purposes of this Section, the term Limitation Year means the Plan Year.
(h) For purposes of satisfying the testing requirements of paragraph (b) the Plan Administrator may, from time to time, and upon written notification to the Participant, reduce the amount of elective Employee Contributions being deposited into the Plan on behalf of the Highly Compensated Group. If such Contributions have been reduced pursuant to this Subsection, the Plan Administrator may subsequently increase a Participant’s contribution level, up to the level specified in the salary reduction agreement on record, as test results permit.
4.09 Rollover Contributions.
(a) Upon hire by a Participating Employer and any time thereafter an Employee may contribute to the Plan as a Rollover Contribution cash balances distributable from any qualified Profit Sharing, Saving/Thrift, Money Purchase Pension, Target Benefit, Defined Benefit, Employee Stock Ownership, Cash Balance, or Keogh Plan. Effective January 1, 2002, and subject to restrictions imposed by the Plan Administrator, an Employee may also make a Rollover Contribution from an Individual Retirement Account (but not from a Roth IRA), or from an annuity described in Section 403(b) of the Code or a plan described in Section 457(b) of the Code and maintained by a governmental employer.
(b) A Rollover Contribution shall be allocated to the investment funds pursuant to a special investment directive governing such Contribution. Once deposited in the funds, any
20
subsequent changes to the investment of the Rollover Contribution balances will be governed by Section 5.02.
(c) Rollover balances shall not be included in discrimination testing as set forth in Section 4.08(b).
(d) No rollover or transfer shall be accepted from any qualified plan which would result in this Plan becoming legally required to provide any qualified joint and survivor annuity or qualified preretirement survivor annuity benefits pursuant to Treasury Regulation 1.401(a)-20.
Article 5
ACCOUNTS AND ALLOCATIONS
5.01 Participant Accounts . The Recordkeeper shall establish and maintain a separate Account for each Participant. Such Account shall be credited with all contributions on behalf of the Participant. The Account of each Participant shall consist of such sub-accounts as are deemed by the Plan Administrator necessary or appropriate under the circumstances, including the following:
(a) One sub-account (hereinafter referred to as the “Pre-Tax Contribution Account”) shall reflect the contributions made pursuant to the Participant’s salary reduction agreement(s) under Section 4.01, and investment earnings or losses thereon, in addition to any Pre-Tax Contributions and earnings attributable to a Prior Plan. The
(b) One sub-account (hereinafter referred to as the “Rollover Account”) shall reflect any amounts transferred to the Fund with respect to a Participant pursuant to Section 4.09, and investment earnings or losses thereon. No further contributions will be allowed into this sub-account, except as provided for under Section 4.09.
(c) One sub-account (hereinafter referred to as the “Employer Profit Sharing Contribution Account”) shall reflect any contributions made to the Fund with respect to a Participant pursuant to Section 4.03, and investment earnings or losses thereon.
(d) One sub-account (hereinafter referred to as the “Employer Matching Contribution Account”) shall reflect any contributions made to the Fund with respect to a Participant pursuant to Section 4.04, and investment earnings or losses thereon.
(e) One sub-account (hereinafter referred to as the “Qualified Matching Contribution Account”) shall reflect any contributions made to the Fund with respect to a Participant pursuant to Section 4.05, and investment earnings or losses thereon.
(f) One sub-account (hereinafter referred to as the “Qualified Non-elective Contribution Account”) shall reflect any contributions made to the Fund with respect to a Participant pursuant to Section 4.06, and investment earnings or losses thereon.
(g) Amounts transferred to the Plan upon the merger of a Prior Plan into the Plan shall be credited to the subaccount which corresponds to the type of contribution made to the
21
Prior Plan. Notwithstanding the foregoing, the Plan Administrator may provide for the amounts transferred from a Prior Plan to be credited to one or more separate sub-accounts if such amounts need to be segregated in order to preserve Prior Plan distribution or vesting rights, or for any other purpose determined by the Plan Administrator.
5.02 Investment Directives.
(a) Each Participant shall direct, pursuant to procedures established by the Plan Administrator, the allocation of his Accounts among the investment funds described in Section 5.02(c), subject to the restrictions described in the last sentence of Section 5.02(d). Each allocation shall be in one (1) percent increments. Such direction applies generally to the entire Account, except that cash dividends paid on shares of the Employer that are held in the Employer Stock Fund shall be automatically reinvested in the applicable Employer shares.
(b) A Participant’s initial investment directive shall allocate his entire Account (except for any amounts allocated to the Employer Stock Fund if so required under Section 5.02(d)), together with all subsequent contributions to the Account for so long as the directive remains in effect. Any investment directive shall remain in effect until changed by a new directive. The Plan Administrator shall permit Participants to make new directives at any time, subject to such limitations as the Plan Administrator may adopt for administrative purposes, which limitations will apply to all Participants on a nondiscriminatory basis, and be consistent with Section 404(c) of the Act and the Department or Labor regulations thereunder. Any such new investment directive shall allocate the Participant’s future contributions among the funds. Subject to such rules as the Plan Administrator prescribes, a Participant may also reallocate among the funds amounts previously credited to the Participant’s Account. Properly completed initial and new directives must be received by the Plan Administrator before the cut-off dates established for the processing of investment directives and changes. The Plan Administrator may allow initial and new directives to be entered orally or by other electronic means, if confirmed in writing to the Participant. The Plan Administrator shall determine the investment of the Accounts of Participants who do not provide investment directives. In the case of amounts transferred from a Prior Plan, the Plan Administrator may provide for such amounts to be invested in the investment funds that most closely resemble the risk and reward characteristics of the funds in which the Participant had elected to invest his account in the Prior Plan.
(c) The Plan Administrator shall establish investment funds, and shall add, delete and change investment funds as it deems appropriate. At any time, the Plan shall offer at least three investment funds:
(i) each of which is diversified;
(ii) each of which has materially different risk and return characteristics;
(iii) which in the aggregate enable the Participant or Beneficiary by choosing among them to achieve a portfolio with aggregate risk and return characteristics at any point within the range normally appropriate for the Participant or Beneficiary; and
22
(iv) each of which when combined with investments in the other alternatives tends to minimize through diversification the overall risk of a Participant’s or Beneficiary’s portfolio.
(d) The Plan Administrator may establish one or more Employer Stock Funds to hold shares of the Employer contributed as Employer Profit Sharing Contributions or shares received prior to 1995 and deposited into the Plan by Participating Employers. Each Employer Stock Fund shall hold shares of one of the Participating Employers. Participation in each Employer Stock Fund shall be limited to participants who are Employees of the applicable Participating Employer. If the Plan Administrator establishes one or more Employer Stock Funds, at least three other investment funds meeting the above requirements shall be offered into which a Participant may transfer amounts previously credited to the Participant’s Employer Profit Sharing Contribution Account. In no event may a Participant transfer amounts into the Employer Stock Fund pursuant to an investment directive.
(e) If the Plan Administrator discontinues offering an investment fund, Participants will be given the option to move their Fund balances to the other available funds.
(f) The Plan Administrator may impose restrictions on investment directives to keep fund balances from moving into or out of certain investment funds.
(g) Except to the extent that the Plan Administrator shall decide with respect to a fund or funds, the Plan Administrator shall satisfy such conditions set forth in the U.S. Department of Labor regulations regarding circumstances under which Plan fiduciaries would not be liable for losses resulting from Participant-directed investments in accordance with Section 404(c) of the Act, as are within the scope of the Plan Administrator’s authority and discretion. Such conditions include providing a Participant a reasonable opportunity to: (i) give investment instructions to the Plan Administrator; (ii) obtain sufficient information to make informed decisions with regard to investment alternatives available under the Plan, and incidents of ownership appurtenant to such investments, and (iii) choose, from a broad range of investment alternatives, the manner in which some or all of the assets in his account are invested.
5.03 Valuation . On each Valuation Date, the Recordkeeper shall establish new account balances which shall reflect each Account’s (and sub-account’s) proper portion of the net income earned on, expenses and charges against, and the appreciation and/or depreciation of the respective investment funds in which the Account has been invested since the previous Valuation Date.
In determining such new Account balances, the Recordkeeper shall adjust the portion of each Participant’s Account invested in each respective fund on the basis of the actual investment return experienced by each fund. For purposes of such adjustment, all assets of the Trust Fund shall be valued at their fair market value as of each Valuation Date.
5.04 Value of Account for Purposes of Distribution.
(a) Upon a Participant’s Termination of Employment, the value of such Participant’s Account (and of the respective sub-accounts) for purposes of determining the vested amount, if any, to be distributed in accordance with Article 6 shall be equal to the value of the Participant’s
23
Account as of the Month-end Valuation Date coinciding with or next following the date of Termination of Employment.
(b) All amounts held for distribution to a Participant shall continue to be adjusted on each Valuation Date following the Termination of Employment in accordance with Section 5.03 until the entire Account has been paid to the Participant, but no additional contributions shall be made to the Account after the Termination of Employment, except (i) as provided in Sections 4.03, 4.04, 4.05 and 4.06 with respect to any final Employer Contributions which may be due on behalf of the Participant; or (ii) to take account of additional compensation after the Participant’s Termination of Employment.
(c) Notwithstanding any provision herein to the contrary, any distribution made hereunder to or with respect to a Participant shall be net of the then outstanding balance of any loan made to such Participant pursuant to Section 6.14.
5.05 Expenses . To the extent consistent with applicable law, the Plan Administrator may authorize that (i) reasonable administrative expenses may be deducted from plan earnings, (ii) direct charges for expenses may be made directly to a Participant’s account for specific activities requested by that Participant.
5.06 Voting of Employer Stock . If the Plan offers an Employer Stock Fund as an investment fund, the Plan Administrator shall direct the Trustee how to vote all shares of stock held in the Stock Fund with respect to all voting rights and occasions for the exercise of same.
5.07 Errors . Where an error or omission is discovered in any Participant’s Account or in any payment made to a Participant, the Plan Administrator shall make appropriate corrective adjustments as soon as possible after discovery of such error, but no later than the end of the Plan Year in which the error or omission is discovered.
5.08 Allocations Do Not Affect Vesting . The fact that an allocation has been made shall not operate to vest in any Participant any right or interest in or to any specific Account balance or assets of the Fund, except as herein provided.
5.09 Limitations on Allocations.
(a) The amount of Annual Additions which may be credited to a Participant’s Account under this Plan for any Limitation Year shall not exceed the “maximum permissible amount” as set forth in Section 415 of the Code. “Maximum permissible amount” means the lesser of:
(i) $30,000 ($40,000 effective January 1, 2002), as indexed pursuant to Code Section 415(d); or
(ii) 25 percent (100 percent effective January 1, 2002) of the Participant’s compensation for such Limitation Year.
(b) “Annual Additions” means the total of: (a) Company contributions (Employer Matching Contributions, Employer Profit Sharing Contributions, Qualified Matching and
24
Qualified Non-Elective Contributions) allocated to a Participant’s Account under this Plan and any Related Plan during any Limitation Year; (b) the amount of Employee contributions made by the Participant under this Plan and any Related Plan; and (c) forfeitures allocated to a Participant’s Account under this Plan and any Related Plan.
(c) For purposes of this Section, “compensation” shall mean the total compensation paid to the Employee by all Employers and Related Employers that is reportable in Box 1 of Form W-2 for the Limitation Year, plus all elective deferrals and exclusions from income under Section 402(g), 125, or 132(f) of the Code.
(d) For purposes of this Section, “Limitation Year” means the Plan Year.
(e) To the extent that annual additions to this Plan with respect to a Participant exceed the “maximum permissible amount” for a Limitation Year, then the Participant’s Pre-Tax Contributions (including earnings and losses thereon) allocated for the Limitation Year shall be returned to the Participant to the extent described in Treasury Department regulation 1.415-6(b)(6)(iv). Excess annual additions for the Limitation Year that are not returned in accordance with the prior sentence, shall be carried forward to the next following Limitation Year and used to reduce future Employer contributions for affected Participants, as described in Treasury Department regulation 1.415-6(b)(6)(ii).
Article 6
DISTRIBUTION AND VESTING
6.01 Normal Retirement . Each Participant whose employment with the Employer continues until his Normal Retirement Date shall be entitled to retire under this Plan. In the event of such normal retirement, all amounts credited to the Participant’s Account valued in accordance with Section 5.04 shall be distributed to the Participant in the manner hereinafter provided.
6.02 Postponed Retirement . Subject to Subsection 6.07(b), in the event that a Participant continues his employment after his Normal Retirement Date, the Participant shall continue to be treated in all respects as a Participant until his actual retirement from employment with the Employer. In the event of such postponed retirement, the Participant shall not be entitled to a distribution from the Plan until his actual retirement from employment with the Employer. Upon such actual retirement, all amounts credited to the Participant’s Account as of such actual retirement, valued in accordance with Section 5.04, shall be distributed to the Participant in the manner provided hereinafter.
6.03 Permanent Disability . In the event that a Participant shall have a Termination of Employment because of Permanent Disability, all amounts credited to the Participant’s Account as of such termination date, valued in accordance with Section 5.04, shall become fully vested and be distributed to Participant in the manner hereinafter provided.
6.04 Distribution Upon Death . Should any Participant die prior to his Termination of Employment under the Plan, all amounts credited to the Account of such Participant as of the date of death, valued in accordance with Section 5.04, shall become fully vested and shall be
25
distributed to such deceased Participant’s Beneficiary or Beneficiaries in the manner provided herein.
6.05 Termination of Employment.
(a) Upon a Participant’s Termination of Employment for any reason other than Retirement, Permanent Disability or Death, the Participant shall be entitled to the vested portion of his Account, valued in accordance with Section 5.04, which shall be distributed in the manner hereinafter provided. That portion of the Participant’s Account that is not vested upon Termination of Employment shall be subject to forfeiture in accordance with Section 6.06. Notwithstanding the foregoing, if within 30 days of Termination of Employment, the Participant becomes employed by a company listed on Schedule A, and if the Participant does not consent to an immediate distribution, then his account is held pending further accrual of vesting credit until he is no longer employed by any company on Schedule A.
(b) In the case of a sale or other transfer of a portion of an Employer’s business, Participants whose employment is transferred to a successor employer in connection with the sale shall be considered to have incurred a Termination of Employment only if (i) the transfer constitutes a “separation from service” as defined in Section 401(k)(2)(B)(i)(I) of the Code (or an event described in Section 401(k)(10)), and (ii) the Accounts of the Participants involved are transferred to a plan maintained by the successor in a transaction meeting the requirements of Section 414(l) of the Code.
(c) The vested portion of any Participant’s Account shall be determined as follows:
(i) A Participant shall always be 100% vested in his Pre-Tax Contribution Account, Rollover Contribution Account, Qualified Matching Contribution Account and Qualified Non-Elective Contribution Account.
(ii) A Participant shall be vested in a percentage of his Employer Profit Sharing Contribution and Employer Matching Contribution Accounts based on his years of Credited Service as of the date of his Termination of Employment in accordance with the following vesting schedule:
|
Years of Credited Service |
|
Vested Percentage |
|
Less than 2 |
|
0% |
|
2 |
|
25% |
|
3 |
|
50% |
|
4 |
|
75% |
|
5 or more |
|
100% |
26
(iii) Except as modified in this Section 6.05(c), the vested percentage for the Prior Plan Balances Account shall be governed by the vesting provisions of the prior plan.
(iv) The vested percentage for the Prior Plan Balances Account for individuals who were active in the Wellsford Residential Property Trust 401(k) Profit Sharing Plan shall be determined in accordance with the following schedule:
|
Years of Credited Service |
|
Vested Percentage |
|
Less than 2 years |
|
0% |
|
2 years, but less than 3 |
|
20% |
|
3 years, but less than 4 |
|
40% |
|
4 years, but less than 5 |
|
60% |
|
5 years or more |
|
100% |
(v) The vested portion of the Accounts of Participants who formerly participated in the Lexford Plan, the Grove Plan or the Globe Plan shall be determined under the provisions of this Plan, but shall in no event be less than the vested portion of their Accounts in the Lexford Plan, Grove Plan, or Globe Plan determined as of the day immediately prior to the day on which they began to participate in this Plan.
6.06 Disposition of Forfeitures.
(a) As of the date that a Participant has a Termination of Employment under circumstances which do not entitle him to 100% of his Employer Profit Sharing Contribution or Employer Matching Contribution Account, the portion of his Account which is not vested is shall be forfeited, subject to restoration under Section 6.06(b). Forfeited amounts shall be used as promptly as practicable to pay expenses of the Plan and Trust payable after the date of forfeiture, and otherwise shall be applied to reduce the amount of Employer Contributions. Until so used, forfeited amounts will be credited to one or more separate suspense accounts which shall earn a fixed rate or money market rate of interest unless the Plan Administrator directs the use of any other investment option.
While a single suspense account is maintained for Forfeitures, the Forfeitures therein which are available to be applied against Employer Profit Sharing and Matching Contributions shall be applied against such Contributions of each contributing Employer, in proportion to each respective Employer’s Profit Sharing or Matching Contributions (as the case may be). If a separate suspense account is maintained with respect to each Employer, and only Forfeitures attributable to Employees of a particular Employer are credited to that Employer’s Forfeiture suspense account, then the Plan Administrator shall direct that amounts in proportion to the respective balances of each such suspense account be used to pay Plan and Trust expenses and
27
any remaining balance in each such account shall be applied only against the Employer Profit Sharing and Matching Contribution obligations (in that order of priority) of the Employer with respect to which such account is maintained.
(b) If (i) the Plan Administrator, pays to any terminated Participant who is not 100% vested in his Account, the vested portion of his Account prior to the time such Participant has incurred five (5) consecutive Breaks in Service and (ii) such Participant resumes employment as an Employee after receipt of such distribution and before incurring five (5) consecutive Breaks in Service, then the provisions of this Section 6.06(b) shall be applicable. Upon such reemployment, the Participant may repay the vested portion received as such distribution within five (5) years after rehire. If and only if the Participant makes such repayment, the forfeited portion of the Participant’s Account shall be restored to his credit and an additional Employer contribution in that amount shall be made for that purpose. In the event of any subsequent Termination of Employment occurring after the date of such reemployment, the Participant’s vested interest in his Employer Accounts shall not be less than the amount determined, as of the appropriate Valuation Date, as follows:
(i) If the distribution has not been repaid:
(ii) Once the distribution has been repaid, and the forfeitures have been restored to the Participant’s Account:
|
X |
|
= |
|
P (AB), |
|
|
|
|
|
|
|
Where: |
|
|
|
|
|
|
|
|
|
|
|
X |
|
= |
|
the amount of his vested interest in his Employer Accounts; |
|
|
|
|
|
|
|
P |
|
= |
|
the Participant’s vested percentage as determined under Section 6.05; |
28
|
AB |
|
= |
|
the balance in his Employer Accounts (includes the repaid distribution and restored forfeitures); |
The Trustee shall thereafter distribute, in accordance with this Article 6, the Participant’s vested interest in his Account, as determined above, and any nonvested balance in his Account shall be a Forfeiture.
6.07 Valuation and Timing of Distribution.
(a) Subject to the rules in this Section, distributions shall be made as soon as practicable after a Participant’s Termination of Employment, but not later than sixty (60) days after the end of the Plan Year in which the Termination of Employment occurred.
(b) Distributions shall be valued as of the Valuation Date following the date of Termination of Employment except (i) distributions delayed pursuant to subsection (d) shall be valued as of the Valuation Date next following the Plan Administrator’s receipt of the Participant’s consent to receive the distribution; and (ii) distributions delayed pursuant to subsection (c) shall be valued as of the Valuation Date with respect to which the related contributions are first reflected on the quarterly account statement provided to the Participant.
(c) If a Participant is entitled to an allocation of contributions under Sections 4.03, 4.04, 4.05 and/or 4.06 for the Plan Year containing his Termination of Employment date, the Participant shall be allowed to defer receipt of his distribution until the Valuation Date next following the date as of which such allocation is made. If a Participant makes contributions under Section 4.01 for any portion of the calendar quarter after his Termination of Employment date, his distribution shall be deferred until the Valuation Date next following the quarter the contributions are made.
(d) If at any time the distributable balance in a terminated Participant’s Account, or the portion thereof payable to a Beneficiary, does not exceed $5,000 ($3,500 for Plan Years prior to 1998), the total remaining balance shall be distributed to the Participant or Beneficiary in a single lump sum. For distributions prior to March 22, 1999, the foregoing sentence shall apply only if the Participant’s Account balance never exceeded $5,000 ($3,500) immediately prior to an earlier distribution. Effective January 1, 2002, for this purpose the balance in the Participant’s Account shall not include any balance in his Rollover Account.
The distributable balance of a Participant’s Account to a Participant or Beneficiary who is entitled to begin receiving the balance in his Account prior to 90 days after the date on which he receives a restated summary plan description describing the changes made by the restatement of the Plan effective January 1, 2001, and whose distributable balance exceeds $5,000, may be distributed, with the Participant’s or Beneficiary’s consent, in any form permitted by the Plan prior to such restatement (including any form permitted by a Prior Plan in which the Participant was a participant). Such consent may be submitted, on forms provided by the Plan Administrator, at any time after Termination of Employment, in accordance with the Plan Administrator’s schedule for processing distributions. If the terminated Participant or Beneficiary does not consent to such a distribution, then no distribution may be made to him
29
prior to the end of the Plan Year in which such Participant either dies or attains his Normal Retirement Date (whichever occurs first).
(e) Unless the Participant otherwise elects, a distribution be made no later than sixty (60) days after the close of the Plan Year which contains the latest of (1) the date on which the Participant attains the earlier of age 65 or his Normal Retirement Date, (2) the tenth (10th) anniversary of the year in which the Participant commenced participation in the Plan, or (3) the Participant’s Termination of Employment.
(f) The account balances of former employees of Cardinal Industries, Inc. that were transferred to this Plan upon the merger of the Cardinal Plan and do not exceed $5,000 shall be distributed to such former employees in a single lump sum as soon as administratively feasible following the merger. To the extent the Plan Administrator is unable to locate any such former employee, his account balance shall be forfeited and reallocated, subject to restoration, as provided in Section 6.11.
(g) Notwithstanding the foregoing provisions of this Section, in no event shall any portion of a Participant’s Pre-Tax Contribution Account, Qualified Matching Contribution Account or Qualified Non-Elective Contribution Account be withdrawn or distributed even pursuant to a “qualified domestic relations order,” as defined in Section 414(p) of the Code) prior to the Participant’s Termination of Employment or attainment of age 59-1/2, whichever occurs first, except as otherwise provided in Section 6.09.
(h) Notwithstanding the foregoing, distributions under the Plan generally shall commence not later than April 1st following the calendar year in which such Participant attains age 70-1/2. In the case of a Participant who is still employed, and is not a 5% owner, within the meaning of Section 416(i)(1)(B)(i) of the Code, in the year in which he attains age 70-1/2, distribution shall commence not later than April 1st of the year in which his employment is terminated.
(i) Notwithstanding any provisions hereunder, any distribution form or other right available under a Prior Plan that is protected under Section 411 of the Code shall be available with respect to applicable balances of the Prior Plan Balances Account, but only to the extent required by law. In the case of a Participant whose Account is transferred from a Prior Plan that provides for distributions in any form other than a lump sum on or after the Effective Date, distribution shall be permitted in such form only for a Participant whose Account becomes distributable before December 31, 2001, and thereafter shall be distributable only in a lump sum as provided herein, provided that such lump sum shall otherwise be available at the same times and on the same terms that such other form of distribution was available under the Prior Plan.
(j) As of the date that a Participant attains the age of 59 1/2, such Participant may withdraw his Vested Balance.
6.08 Method of Distribution.
(a) The method of distribution for all benefits shall be a single sum payment.
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(b) If distribution is to commence by reason of the death of the Participant, then the Participant’s Account shall be paid to the Participant’s Beneficiary within five (5) years after the date of the Participant’s death in accordance with this Section 6.08.
(c) Distributions may be made wholly or partly in cash or in kind as allowed by the Plan Administrator, provided that no discrimination in value results therefrom and provided that distributions shall be made in cash unless the Participant or his or her Beneficiary otherwise elects in a manner acceptable to the Plan Administrator, including orally or by other electronic means, if confirmed in writing to the Participant or Beneficiary prior to implementation.
(d) The Plan Administrator in conjunction with the Recordkeeper shall issue directions to the Trustee and/or transfer agent concerning the recipient, the commencement and the method of distribution of all benefits which are to be paid from the Trust Fund pursuant to the Plan.
(e) No later than fourteen (14) days after a distribution is made in lump sum form under this Plan, the Plan Administrator shall provide the recipient with a written notice of the federal income tax treatment applicable to a lump sum distribution, as and to the extent required by Section 402(f) of the Code, as amended, and proper regulations thereunder.
(f) Distributions pursuant to this Section shall be made in the name of the Participant with 20% (or such other amount required by law) withheld for tax purposes, or shall be made in the name of an IRA or Trustee for the full amount of the distribution in accordance with the following:
(g) If a Participant timely elects to have a distribution payable hereunder paid directly to an eligible retirement plan, and specifies the eligible retirement plan to which such distribution is to be paid (in such form and at such time as the Plan Administrator may prescribe), such distribution shall be made in the form of a direct rollover or trustee-to-trustee transfer to the eligible retirement plan so specified.
(i) For purposes of this Section 6.08(f), the term “eligible rollover distribution” has the meaning given to such term by Section 401(f)(2)(A) of the Code. Effective January 1, 1999, the term “eligible rollover contribution” shall not include any hardship distribution described in Section 410(k)(2)(B)(i)(IV).
(ii) For purposes of this Section 6.08(f), the term “eligible retirement plan” has the meaning given to such term by Section 401(c)(8)(B) of the Code, except that a qualified trust shall be considered an eligible retirement plan only if it is a defined contribution plan, the terms of which permit the acceptance of rollover distributions.
(iii) For purposes of this Section 6.08(f), to the extent allowed under Section 402 of the Code, an alternative payee entitled to receive an eligible rollover distribution from the Plan pursuant to a qualified domestic relations order, and a surviving Beneficiary of a deceased Participant, shall
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have the same right to elect a transfer of their benefit as a Participant is accorded under this Section.
(iv) Within a reasonable time before making an eligible rollover distribution, the Plan Administrator shall provide, in accordance with Section 401(f)(1) of the Code, to the recipient of such distribution, a written explanation of the recipient’s transfer rights under this Section 6.08(f) and of the required withholding of tax on the distribution if such a transfer were not elected.
6.09 Withdrawal of Accounts.
(a) A Participant may elect to withdraw, in cash, any portion of the Pre-Tax Contributions from his Pre-Tax Contribution Account, but not earnings thereon, and any portion of the Rollover Account, determined as of the Valuation Date preceding the date of his request, that is not being used as security for a loan under Section 6.14. His request for withdrawal shall be submitted to the Plan Administrator in writing not less than sixty (60) days prior to the desired withdrawal date (or such lesser period as the Plan Administrator may allow to accommodate financial emergencies). The Participant shall provide such further information as the Plan Administrator may request in support of the withdrawal request. The Plan Administrator shall approve or disapprove the withdrawal request in accordance with any applicable regulations under Section 401(k) of the Code and such rules, consistent with any such regulations, as the Plan Administrator shall adopt and apply uniformly to similarly situated Participants.
(b) Unless the Participant has attained age 59-1/2, he shall not be entitled to a withdrawal of Pre-Tax Contributions except in the event and to the extent of “financial hardship.” For purposes of this Section, “financial hardship” means an immediate and heavy financial need occurring in the Participant’s personal affairs which cannot reasonably be satisfied from other resources available to the Participant. Such hardship shall be determined by the Plan Administrator from appropriate evidence furnished by the Participant and in accordance with applicable regulations under Section 40l(k) of the Code. Unless the Plan Administrator decides, from time to time, to determine financial need on the basis of all relevant facts and circumstances, a Participant’s financial need shall be deemed sufficiently immediate and heavy to justify a hardship withdrawal under this Section only with respect to:
(i) medical expenses described in Section 213(d) of the Code previously incurred by the Participant, his spouse or dependents (as defined in Section 152 of the Code), or necessary for any of these persons to obtain medical care described in Section 213(d) of the Code;
(ii) the purchase (excluding mortgage payments) of a principal residence for the Participant;
(iii) payment of tuition and related educational fees for the next twelve months of post-secondary education for the Participant, his spouse, children or dependents;
(iv) the need to prevent eviction of the Participant from his principal residence or foreclosure on the mortgage of his principal residence;
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(v) funeral expenses of a family member of the Participant; or
(vi) any other circumstance determined by the Internal Revenue Service to constitute immediate and heavy financial need for this purpose.
A Withdrawal shall not be treated as necessary to satisfy an immediate and heavy financial need of an Participant to the extent the amount of the Withdrawal is in excess of the amount required to relieve the financial need or to the extent such need may be satisfied from other resources that are reasonably available to the Participant. This determination generally is to be made on the basis of all relevant facts and circumstances. The Participant’s resources include those assets of an Participant’s spouse and minor children that are reasonably available to the Participant. However, property held for the Participant’s child under an irrevocable trust or under the Uniform Gifts to Minors Act shall not be treated as a resource of the Participant. The amount of an immediate and heavy financial need may include any amounts necessary to pay any federal, state, or local income taxes or penalties reasonably anticipated to result from the Withdrawal. A Withdrawal generally may be treated as necessary to satisfy a financial need if the Plan Administrator relies upon the Participant’s written representation, unless the Employer or Plan Administrator has actual knowledge to the contrary, that the need cannot reasonably be relieved:
(i) Through reimbursement or compensation by insurance or otherwise;
(ii) By reasonable liquidation of the Participant’s assets, to the extent such liquidation would not itself cause an immediate and heavy financial need;
(iii) By cessation of Pre-Tax Contributions under the Plan; or
(iv) By other distributions or nontaxable (at the time of the loan) loans from plans maintained by the Employer or by any other employer, or by borrowing from commercial sources on reasonable commercial terms in an amount sufficient to satisfy the need.
A need cannot be reasonably relieved by one of the actions listed above if the effect would be to increase the amount of the need. Notwithstanding (iii) above, a Participant may, but shall not be required to, suspend or cease his or her Pre-Tax Contributions in the event the Employer relies upon such Participant’s written representation regarding the amount of withdrawal necessary to satisfy a financial need.
(c) No Participant will be permitted to receive any portion of his Employer Profit Sharing, Matching Contribution, Qualified Matching or Qualified Non-elective Accounts, except as a distribution in accordance with Sections 6.01 through 6.07 and as a loan in accordance with Section 6.14.
6.10 Payment to Minors and Incapacitated Persons . In the event that any amount is payable to a minor or to any person who, in the judgment of the Plan Administrator, is incapable of making proper disposition thereof, such payment shall be made for the benefit of such minor or such person in any of the following ways as the Plan Administrator, shall determine:
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(i) by payment to the legal representative of such minor or such person;
(ii) by payment directly to such minor or such person; or
(iii) by payment to any other person/entity caring for such person.
The Trustee shall make such payments as directed by the Plan Administrator, without the necessary intervention of any guardian or like fiduciary, and without any obligation to require bond or to see to the further application of such payment. Any payment so made shall be in complete discharge of the Plan’s obligation to the Participant and his Beneficiaries.
6.11 Missing Persons . In the event that all, or any portion, of the distribution payable to a Participant or his Beneficiary hereunder shall remain unpaid solely by reason of the inability of the Plan Administrator to locate such Participant or his Beneficiary, after sending a certified or registered letter, return receipt requested to the last known address, then the Plan Administrator may attempt to ascertain the whereabouts of such Participant or Beneficiary, through programs established by the Social Security Administration or the Internal Revenue Service. However, if such efforts should fail to locate such Participant or Beneficiary, then the remaining amount distributable with respect to such Participant or his Beneficiary shall be forfeited and reallocated in the same manner as a Forfeiture. In the event a Participant or Beneficiary is located subsequent to his benefit being reallocated, and such person claims such reallocated benefit, such benefit shall be restored out of current year Forfeitures (or if necessary an additional contribution by such person’s Employer), unadjusted for gains or losses. In the event that the Plan is terminated, the benefits maintained in an account under the Plan, on the date of such termination, for the benefit of a Participant, Beneficiary, or Alternate Payee who cannot be located, shall be maintained outside the Plan. Any such benefits may be maintained by the establishment of an individual retirement arrangement or the purchase of an annuity (as described in Sections 408(a) or (b) of the Code), or by another method which meets applicable Department of Labor requirements. The Plan Administrator shall have the sole discretion in determining which method or manner, or combination thereof, from among the preceding, shall be utilized for the purpose of maintaining such benefits. The duty of the named Fiduciaries hereunder, to maintain any such benefits under the Plan, shall be extinguished upon the placement of such benefits outside the Plan in the manner described in this paragraph.
6.12 Application for Benefits . Notwithstanding Section 6.08, the Plan Administrator may require a Participant or Beneficiary to complete and file with the Plan Administrator certain forms as a condition precedent to the payment of benefits. The Plan Administrator may rely upon all such information given to it, including the Participant’s current mailing address. It is the responsibility of all persons interested in distributions from the Trust Fund to keep the Plan Administrator informed of their current mailing addresses.
6.13 Beneficiary.
(a) Each Participant may designate one or more Beneficiaries and successor Beneficiaries (including, without limitation, one or more trustees) to receive any distributions provided herein by reason of his death, or may change any such designation, upon such forms and under such rules (as to manner of becoming effective and other matters) as the Plan
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Administrator shall deem appropriate, provided, that no natural Beneficiary so designated, not living on the date fixed for distribution, nor any other Beneficiary not in existence on such date, shall be entitled to receive any distributions hereunder, and payment shall be made to the next successor designated Beneficiary, if any. To the extent determined by the Plan Administrator, a designation of a beneficiary made under a prior plan will continue to apply under this Plan until changed by the Participant. In the event that a Participant has no valid Beneficiary designation in effect at the time of his death, his entire Account balance shall be distributed to his estate.
(b) In the case of a Participant who has been married for at least one year at the time of his death, any designation of a Beneficiary other than the Participant’s spouse shall not be valid without the consent thereto of the Participant’s spouse. The spouse’s consent (i) shall be irrevocable, (ii) must be in writing, (iii) must acknowledge both the particular designated Beneficiary (including any class of Beneficiaries or any contingent Beneficiaries) and the effect of the designation, and (iv) must be witnessed by a notary public or by a Plan representative designated for such purpose by the Plan Administrator. If the Participant establishes to the satisfaction of the Plan Administrator that such spousal consent cannot be obtained, either because there is no spouse, the spouse cannot be located or such other circumstances as the Secretary of the Treasury may prescribe, then the Participant’s designation will be valid without spousal consent. Any spousal consent given or waived under this Subsection (c) shall be valid only with respect to the spouse who gives such consent or cannot be located and only with respect to the specific Beneficiary consented to. The Participant may revoke a designation made under this Section at any time before his benefits commence without his spouse’s further consent, but any change to a different designated Beneficiary other than his spouse will require his spouse’s further consent in the manner provided in this Subsection, unless the spouse has given a sufficient general consent to changes in Beneficiaries in accordance with regulations under Section 401(a)(9) of the Code. Designations of contingent or successor beneficiaries who become eligible for benefits only if the spouse does not survive the Participant do not require spousal consent under this Subsection.
(c) In the event that a Participant does not designate a Beneficiary, or if for any reason such designation shall be legally ineffective or revoked, or if no designated Beneficiary is living at the time any distribution is to be made, then the distribution shall be made to the then surviving members of the following classes of persons, with preference for classes in the order listed, in equal shares among class members should there be more than one class member then living:
(1) spouse;
(2) children (including children by adoption);
(3) parents (including adopting parents);
(4) brothers and sisters (including brothers and sisters of the half blood and brothers and sisters by adoption); and
(5) the executor or administrator of the Participant’s estate.
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(d) The Plan, Trust and their fiduciaries shall be fully protected in making distributions to the next successor Beneficiary under Subsection (a), (b) or (c) if, within six (6) months after any date fixed for distribution, they have no actual knowledge that a predecessor Beneficiary survived, or was existing on, such date. Nothing in this Section 6.13 shall be deemed to impair the right of any person not described in this Section to benefits under this Plan solely in accordance with a “qualified domestic relations order,” as provided in Section 9.03 of the Plan.
6.14 Loans To Participants.
(a) Loans from the Plan may only be made to Participants who are employed by the Employer (or Participating Employer, if applicable). Such individuals are referred to herein as “Eligible Borrowers.” The number of loans which may be outstanding at any time shall be one (1) unless otherwise provided in the Plan’s loan policy. A loan may not be refinanced, unless otherwise provided in the Plan’s loan policy. Prior to January 1, 2002, Loans shall not be made to any Owner-Employee or Shareholder-Employee. Within each Eligible Borrower’s Account, there shall be maintained a loan subaccount solely for the purpose of effecting loans from the Eligible Borrower’s Account to the Eligible Borrower. The Plan’s loan policy shall set forth all loan rules and restrictions.
A Participant shall not be required to obtain the consent of his or her Spouse prior to obtaining a loan from the Plan, unless the loan policy specifically provides otherwise. If such consent is required, such consent shall be in writing and shall be witnessed by a representative of the Plan or by a notary public.
(b) Availability of Loans.
(i) Application for a loan shall be made to the Plan Administrator or its delegate in the form and manner specified by the Plan Administrator. The decisions by the Plan Administrator or its delegate on loan applications shall be made on a reasonably equivalent, uniform and non-discriminatory basis. Loans shall only be repaid by payroll deduction, unless otherwise provided in the loan policy. The Plan Administrator or its delegate may change the terms of any outstanding loan to the extent required by applicable law to reflect economic and other differences affecting the individuals’ ability to repay any loan.
(ii) Notwithstanding anything herein to the contrary, no loan shall be made to an Eligible Borrower during a period in which the Plan Administrator is making a determination of whether a domestic relations order affecting the Eligible Borrower’s Account is a qualified domestic relations order, as defined in Section 414(p) of the Code. Further, if the Plan Administrator is in receipt of a qualified domestic relations order with respect to any Eligible Borrower’s Account, it may prohibit such Eligible Borrower from obtaining a loan until the rights of the alternate payee entitled to benefits under such order are satisfied.
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(c) A Plan loan shall be derived from and the amount available for a loan shall be based on, the Eligible Borrower’s vested interest in his Accounts, based on the most recent valuation available to the Plan Administrator on the date the loan is approved. The minimum loan available is $1,000. The maximum loan available is the lesser of (i) 50% of the Eligible Borrower’s vested interest in his or her Account; or (ii) $50,000, reduced by the highest outstanding balance of any Plan loan to such Eligible Borrower during the twelve-month period ending on the day before the loan is made.
(d) Terms of Loan.
(i) A loan shall be secured by a lien on the Eligible Borrower’s interest in the Plan, to the maximum extent permitted by the relevant provisions of the Code, the Act, and any regulations or other guidance issued thereunder.
(ii) The interest rate on a loan shall be a reasonable rate of interest as defined by the Plan Administrator or an authorized representative of the Plan Administrator.
(iii) The principal amount and interest on a loan shall be repaid no less frequently than quarterly by level payroll deductions (or payment by other than payroll deduction, if permitted in the loan policy) during each payroll period in which the loan is outstanding; provided, however, that an Eligible Borrower may prepay the full amount due under the loan at any time without penalty. No partial prepayments shall be permitted. The Eligible Borrower may elect a repayment term of 1, 2, 3, 4 or 5 years from the date of a payroll period within one month of the date of the distribution of the loan from the Plan. A longer period may be permitted under the loan policy for purchase of the Participant’s principal residence. Notwithstanding the foregoing, a loan may provide that no payments shall be made for up to six (6) months during a period in which an Eligible Borrower is on an Authorized Absence without pay.
(iv) Each loan shall be evidenced by a promissory note, evidencing the Eligible Borrower’s obligation to repay the borrowed amount to the Plan, in such form and with such provisions consistent with this Section 6.14 as are acceptable to the Plan Administrator or its delegate. All promissory notes shall be deposited with the Trustee or an authorized representative of the Trustee.
(v) Under the terms of the loan agreement, the Plan Administrator or a representative of the Plan Administrator may determine a loan to be in default, and may take such actions upon default in accordance with Section 6.14(f).
(vi) If an Eligible Borrower is transferred from employment with an Employer to employment with an Affiliate, within thirty (30) days of Termination of Employment, he or she shall not be treated as having a severance from
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Service or a separation from employment and the Plan Administrator or its delegate shall make arrangements for the loan to continue to be repaid in accordance with the loan agreement. For this purpose, the Plan Administrator may authorize the transfer of the loan to a qualified plan maintained by such Affiliate. In the absence of such arrangements, the loan shall be deemed to be in default upon such Eligible Borrower’s transfer. The Plan Administrator may also authorize the transfer of a loan to another qualified plan of the Employer.
(e) Distribution and Repayment of Loan.
(i) The loan proceeds shall be transferred to the Eligible Borrower’s loan subaccount by the Trustee and shall be derived from the Eligible Borrower’s interest in the Investment Funds on a pro rata basis. The loan proceeds shall be distributed from the loan subaccount to the Eligible Borrower on the same day as they are received by the loan subaccount.
(ii) Repayments of Plan loans shall be made to the Eligible Borrower’s loan subaccount. Such repayments shall be immediately transferred from the loan subaccount, credited to the Eligible Borrower’s Account and invested in the Investment Funds in the same proportions as his or her current contributions are invested, as soon as administratively practicable after they are received by the loan subaccount.
(f) Events of Default and Action Upon Default.
(i) If an Eligible Borrower does not repay the principal and accrued interest with respect to a Plan loan at the times required by the terms of the loan, the loan shall be in default and the unpaid balance of the loan, together with interest thereon, shall become immediately due and payable. Such default shall constitute a deemed distribution of the unpaid loan amount (including any interest thereon). Further, upon an Eligible Borrower’s severance from Service or separation from employment, such loan shall be deemed to be in default and the unpaid balance of the loan, together with interest thereon shall become due and payable within a reasonable period after such event. If, before a loan is repaid in full, a distribution is required to be made from the Plan to an alternate payee under a qualified domestic relations order (as defined in Section 414(p) of the Code) and the amount of such distribution exceeds the value of the Eligible Borrower’s Account less the amount of such outstanding loan, plus accrued interest, if any, the unpaid balance thereon shall become immediately due and payable. The Trustee shall satisfy the indebtedness to the Plan before making any payments to the Eligible Borrower, a Beneficiary or any alternate payee. In addition to the foregoing, the loan agreement may include such other events of default as the Plan Administrator shall determine are necessary or desirable to safeguard the assets of the Plan in
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order to secure and preserve the assets of the Trust and prevent the loss of principal and interest.
(ii) Upon the default of any Eligible Borrower, the Plan Administrator, or its designate in its sole discretion, may direct the Trustee to take such action as the Plan Administrator or its designate may reasonably determine to be necessary in order to preclude the loss of principal and interest, including:
(1) demanding immediate repayment of the outstanding amount on the loan (including principal and accrued interest); or,
(2) if the loan is not repaid within 90 days of the request for repayment, causing a foreclosure of the loan to occur by distributing the promissory note to the Eligible Borrower or otherwise reducing the Eligible Borrower’s Account by the value of the loan. For these purposes, such loan shall be deemed to have a fair market value equal to its face value (including accrued but unpaid interest) reduced by any payments made thereon by the Eligible Borrower. In the event of any default, the Eligible Borrower’s prior request for a loan shall be treated as the Eligible Borrower’s consent to an immediate distribution of the promissory note representing a distribution of the unpaid balance of any such loan. The loan agreement shall include such provisions as are necessary to reflect such consent. In all events, however, no foreclosure on the Participant’s loan shall be made until the earliest time a distribution may occur without violating any provisions of Sections 401(a) or (k) of the Code and the regulations issued thereunder.
(g) The loan policy shall set forth the specific provisions for Participant Loans, and is herein incorporated as part of the Plan by reference. The loan policy shall include (i) the identity of the person or position authorized to administer the Participant Loan program; (ii) a procedure for applying for Loans; (iii) the basis on which Loans shall be approved or denied; (iv) limitations (if any) on the types and amounts of Loans offered; (v) the procedure under the program for determining a reasonable rate of interest; (vi) the types of collateral which may secure a Participant Loan; (vii) the events constituting default and the steps that shall be taken to preserve Plan assets in the event of such default; and (viii) any other terms and conditions applicable to loans as determined by the Plan Administrator. Loans shall be available to Plan Participants on a nondiscriminatory basis without regard to any individual’s race, color, religion, sex, age or national origin. The Plan Administrator shall have the authority to amend the loan policy at any time, including amendments that alter any of the foregoing provisions of this Section 6.14, subject to the requirements of Section 72(p) of the Code and Section 408(b)(1) of the Employee Retirement Income Security Act of 1974.
(h) The originals of all promissory notes and other forms requested by the Trustee in respect of any Loan shall be retained by the Trustee (or an authorized representative of the
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Trustee), or the Plan Administrator (or an authorized representative of the Plan Administrator) as long as the Loan is outstanding.
6.15 Qualified Domestic Relations Orders.
(a) All rights and benefits, including elections, provided to a Participant in this Plan shall be subject to the rights afforded to any alternate payee under a Qualified Domestic Relations Order. The Plan Administrator is authorized to and shall establish written procedures to effectuate the requirements for administering Qualified Domestic Relations Orders.
(b) No withdrawal may be made under this Plan by a Participant during the period in which the Plan Administrator is making a determination of whether a domestic relations order affecting the Participant’s Account is a Qualified Domestic Relations Order. Further, if the Plan Administrator is aware that a Qualified Domestic Relations Order is being sought with respect to a Participant’s benefit, the Plan Administrator may restrict the Participant’s ability to obtain any withdrawal otherwise available under the Plan until the Plan Administrator has determined that such withdrawal would not be inconsistent with any such order or that no such order shall be submitted. If the Plan Administrator is in receipt of a Qualified Domestic Relations Order with respect to any Participant’s benefit, it may prohibit that Participant from obtaining a withdrawal until the alternate payee’s rights under such order are satisfied.
(c) No distribution may be made to a Participant during the period in which the Plan Administrator is making a determination of whether a domestic relations order affecting the Participant’s benefit is a Qualified Domestic Relations Order. Further, if the Plan Administrator is aware that a Qualified Domestic Relations Order affecting a Participant’s benefit is being sought, it may prohibit such Participant from commencing to receive a distribution until the Plan Administrator has determined that such distribution would not be inconsistent with any such order or that no such order shall be submitted. If the Plan Administrator is in receipt of a Qualified Domestic Relations Order with respect to any Participant’s benefit, it may prohibit such Participant from receiving a distribution until the alternate payee’s rights under such order are satisfied.
(d) If the Plan Administrator is in receipt of a Domestic Relations Order, or the Plan Administrator is otherwise aware that a Qualified Domestic Relations Order affecting a Participant’s Account is being sought, the Plan Administrator may take such actions as necessary (including, without limitation, restricting the Participant’s ability to withdraw, borrow, or direct the investment of funds in his or her Account) in order to administer the Plan consistently with the terms of any such Qualified Domestic Relations Order.
(e) Notwithstanding any other provision of the Plan, in the event that a Qualified Domestic Relations Order is received by the Plan Administrator, benefits shall be payable in accordance with such order and with Section 414(p) of the Code and Section 206(d) of the Act. Payments may be made prior to the Participant’s “earliest retirement age” (as defined in Section 414(p) of the Code and Section 206(d) of the Act), and are not subject to any other distribution or withdrawal restrictions provided in this Plan. The amount payable to the Participant and to any other person other than the alternate payee named in the order shall be adjusted accordingly.
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Pursuant to Section 1.411(a)-11(c)(6) of the Income Tax Regulations, distributions to an alternate payee under the Plan shall not require the consent of the alternate payee, except as shall be provided for in the Qualified Domestic Relations Order applicable to such alternate payee. Any amounts held for the benefit of an alternate payee under the Plan shall be immediately distributable, without the consent of the alternate payee, after the Plan Administrator has determined that an order is a Qualified Domestic Relations Order, pursuant to the Plan’s written administrative procedures for administering Qualified Domestic Relations Orders.
(f) In the absence of a Beneficiary designation in the Qualified Domestic Relations Order, the alternate payee shall be treated as a single Participant under the Plan and the alternate payee’s interest shall pass to his or her estate or other individuals, in accordance with the terms of the Plan.
(g) If this Plan is a Participant-Directed Plan as provided under Article V, the alternate payee shall be entitled to direct the investment of his or her own separate interest, unless the Qualified Domestic Relations Order provides otherwise. Tax basis in Nondeductible Employee Contributions shall be allocated on a pro rata basis, based on the ratio of the alternate payee’s benefit to the Participant’s total benefit (including the portion of his or her benefit assigned to the alternate payee). Alternate payees shall not be entitled to borrow money under the Plan’s loan provisions.
6.16 Special Distribution Rules.
(a) The provisions of this Section 6.16 shall apply for purposes of determining required minimum distributions for calendar years beginning with the 2003 calendar year. The requirements of this Section will take precedence over any inconsistent provisions of the Plan. All distributions required under this Article will be determined and made in accordance with the Treasury Regulations under Code Section 401(a)(9).
(b) Time and Manner of Distribution.
(i) Required Beginning Date . The Participant’s entire interest will be distributed, or begin to be distributed, to the Participant no later than the Participant’s Required Beginning Date.
(ii) Death of Participant Before Distributions Begin . If the Participant dies before distributions begin the Participant’s entire interest will be distributed, or begin to be distributed, no later than as follows:
(1) If the Participant’s surviving spouse is the Participant’s sole Designated Beneficiary, distributions to the surviving spouse will begin by December 31 of the calendar year immediately following the calendar year in which the Participant died or by December 31 of the calendar year in which the Participant would have attained age 70 1/2, if later.
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(2) If the Participant’s surviving spouse is not the Participant’s sole Designated Beneficiary, distribution to a Designated Beneficiary who is not the surviving spouse will be made by no later than December 31 of the calendar year containing the fifth anniversary of the Participant’s death.
(3) If there is no Designated Beneficiary as of September 30 of the year following the year of the Participant’s death, the Participant’s entire interest will be distributed by December 31 of the calendar year containing the fifth anniversary of the Participant’s death.
(4) If the Participant’s surviving spouse is the Participant’s sole Designated Beneficiary and the surviving spouse dies after the Participant but before distributions to the surviving spouse begin, this Section 6.16(b)(ii), other than Section 6.16(b)(ii)(1), will apply as if the surviving spouse were the Participant.
For purposes of this Section 6.16(b)(ii) and Section 6.16(d), unless Section 6.16(b)(ii)(4) applies, distributions are considered to begin on the Participant’s Required Beginning Date. If Section 6.16(b)(ii)(4) applies, distributions are considered to begin on the date distributions are required to begin to the surviving spouse under Section 6.16(b)(ii)(1).
(iii) Forms of Distribution . Unless the Participant’s interest is distributed in a single sum on or before the Required Beginning Date, as of the first Distribution Calendar Year distributions will be made in accordance with Sections 6.16(c) and 6.16(d).
(c) Required Minimum Distributions During Participant’s Lifetime.
(i) Amount of Required Minimum Distribution For Each Distribution Calendar Year . During the Participant’s lifetime, the minimum amount that will be distributed for each Distribution Calendar Year is the lesser of:
(1) the quotient obtained by dividing the Participant’s Account Balance by the distribution period in the Uniform Lifetime Table set forth in Section 1.401(a)(9)-9 of the Treasury regulations, using the Participant’s age as of the Participant’s birthday in the Distribution Calendar Year; or
(2) if the Participant’s sole Designated Beneficiary for the Distribution Calendar Year is the Participant’s spouse, the quotient obtained by dividing the Participant’s Account Balance by the number in the Joint and Last Survivor Table set forth in Section 1.401(a)(9)-9 of the Treasury regulations, using the Participant’s and spouse’s attained ages as of the Participant’s and spouse’s birthdays in the Distribution Calendar Year.
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(ii) Lifetime Required Minimum Distributions Continue Through Year of Participant’s Death . Required minimum distributions will be determined under this Section 6.16(c) beginning with the first Distribution Calendar Year and up to and including the Distribution Calendar Year that includes the Participant’s date of death.
(d) Required Minimum Distributions After Participant’s Death.
(i) Death On or After Date Distributions Begin .
(1) Participant Survived by Designated Beneficiary . If the Participant dies on or after the date distributions begin and there is a Designated Beneficiary, the minimum amount that will be distributed for each Distribution Calendar Year after the year of the Participant’s death is the quotient obtained by dividing the Participant’s Account Balance by the longer of the remaining Life Expectancy of the Participant or the remaining Life Expectancy of the Participant’s Designated Beneficiary, determined as follows:
(A) The Participant’s remaining Life Expectancy is calculated using the age of the Participant in the year of death, reduced by one for each subsequent year.
(B) If the Participant’s surviving spouse is the Participant’s sole Designated Beneficiary, the remaining Life Expectancy of the surviving spouse is calculated for each Distribution Calendar Year after the year of the Participant’s death using the surviving spouse’s age as of the spouse’s birthday in that year. For Distribution Calendar Years after the year of the surviving spouse’s death, the remaining Life Expectancy of the surviving spouse is calculated using the age of the surviving spouse as of the spouse’s birthday in the calendar year of the spouse’s death, reduced by one for each subsequent calendar year.
(C) If the Participant’s surviving spouse is not the Participant’s sole Designated Beneficiary, the Designated Beneficiary’s remaining Life Expectancy is calculated using the age of the beneficiary in the year of the Participant’s death, reduced by one for each subsequent year.
(2) No Designated Beneficiary . If the Participant dies on or after the date distributions begin and there is no Designated Beneficiary as of September 30 of the year after the year of the Participant’s death, the minimum amount that will be distributed for each Distribution Calendar Year after the year of the Participant’s death is the quotient obtained by dividing the Participant’s Account Balance by
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the Participant’s remaining Life Expectancy calculated using the age of the Participant in the year of death, reduced by one for each subsequent year.
(ii) Death Before Date Distributions Begin .
(1) Participant Survived by Designated Beneficiary . If the Participant dies before the date distributions begin and there is a Designated Beneficiary, the minimum amount that will be distributed for each Distribution Calendar Year after the year of the Participant’s death is the quotient obtained by dividing the Participant’s Account Balance by the remaining Life Expectancy of the Participant’s Designated Beneficiary, determined as provided in Section 6.16(d)(i).
(2) No Designated Beneficiary . If the Participant dies before the date distributions begin and there is no Designated Beneficiary as of September 30 of the year following the year of the Participant’s death, distribution of the Participant’s entire interest will be completed by December 31 of the calendar year containing the fifth anniversary of the Participant’s death.
(3) Death of Surviving Spouse Before Distributions to Surviving Spouse Are Required to Begin . If the Participant dies before the date distributions begin, the Participant’s surviving spouse is the Participant’s sole Designated Beneficiary, and the surviving spouse dies before distributions are required to begin to the surviving spouse under Section 6.16(b)(ii)(1), this Section 6.16(d)(ii) will apply as if the surviving spouse were the Participant.
(e) Definitions. The following definitions shall apply for purposes of this Section 6.16:
(i) ‘Designated Beneficiary’ means the individual who is designated as the beneficiary under Section 6.13 and is the designated beneficiary under Section 401(a)(9) of the Internal Revenue Code and Section 1.401(a)(9)-1, Q&A-4, of the Treasury regulations.
(ii) ‘Distribution Calendar Year’ means a calendar year for which a minimum distribution is required. For distributions beginning before the Participant’s death, the first Distribution Calendar Year is the calendar year immediately preceding the calendar year which contains the Participant’s Required Beginning Date. For distributions beginning after the Participant’s death, the first Distribution Calendar Year is the calendar year in which distributions are required to begin under Section 6.16(b)(ii). The required minimum distribution for the Participant’s first Distribution Calendar Year will be made on or before the Participant’s Required
44
Beginning Date. The required minimum distribution for other Distribution Calendar Years, including the required minimum distribution for the Distribution Calendar Year in which the Participant’s Required Beginning Date occurs, will be made on or before December 31 of that Distribution Calendar Year.
(iii) ‘Life Expectancy’ means life expectancy as computed by use of the Single Life Table in Section 1.401(a)(9)-9 of the Treasury regulations.
(iv) ‘Participant’s Account Balance’ means the account balance as of the last valuation date in the calendar year immediately preceding the Distribution Calendar Year (valuation calendar year) increased by the amount of any contributions made and allocated or forfeitures allocated to the account balance as of dates in the valuation calendar year after the valuation date and decreased by distributions made in the valuation calendar year after the valuation date. The account balance for the valuation calendar year includes any amounts rolled over or transferred to the plan either in the valuation calendar year or in the Distribution Calendar Year if distributed or transferred in the valuation calendar year.
(v) ‘Required Beginning Date’ means the date specified in Section 6.07(h) of the Plan.
Article 7
ADMINISTRATION OF THE PLAN
7.01 Named Fiduciaries . The following parties are named as Fiduciaries of the Plan and shall have the authority to control and manage the operation and administration of the Plan:
(i) The Company;
(ii) The Trustee;
(iii) The Plan Administrator.
The Fiduciaries named above shall have only the powers and duties expressly allocated to them in the Plan and in the Trust Agreement and shall have no other powers and duties in respect of the Plan; provided, however, that if a power or responsibility is not expressly allocated to a specific named fiduciary, the power or responsibility shall be that of the Company. No Fiduciary shall have any liability for, or responsibility to inquire into, the acts and omissions of any other Fiduciary in the exercise of powers or the discharge of responsibilities assigned to such other Fiduciary under this Plan or the Trust Agreement.
7.02 Company . The Company:
(i) shall be the Plan Administrator, or shall appoint the Plan Administrator as provided in Section 7.03(a);
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(ii) shall cause Employers to make contributions to the Plan, as required in the Plan;
(iii) shall appoint and remove the individuals, banks, or other entities who serve as Trustee, and the members of the Committee, as provided herein; and
(iv) may amend any or all of the provisions of the Plan and to terminate the Plan, in whole or in part, pursuant to the procedures provided hereunder.
7.03 Trustee . The Trustee shall exercise all of the powers and duties assigned to the Trustee as set forth in the Trust Agreement. The Trustee shall have no other responsibilities with respect to the Plan.
7.04 Plan Administrator.
(a) The Plan Administrator shall be the Company, or such person (including any entity or committee) as the Company may designate as Plan Administrator by action of its Board of Trustees. The authority of the Company shall be exercised by the Committee, or by officers, employees and agents of the Company, as set forth in this Section 7.04; provided, however, that the fact that the Company has delegated a portion of its authority as Plan Administrator to another person shall not cause such person to become the Plan Administrator unless such person is specifically so designated and acknowledges such designation in writing.
(b) The Company may appoint a Committee to act as its agent in the administration of the Plan in accordance with the provisions of this Section 7.04. The Committee shall consist of a number of members determined by the Company, who shall be appointed by and serve at the pleasure of the Company. Any Participant, officer, or director of the Employer shall be eligible to be appointed a member of the Committee and all members shall serve as such without compensation. Upon termination of his employment with the Employer, or upon ceasing to be an officer or director, if not an Employee, he shall cease to be a member of the Committee. The Company shall have the right to remove any member of the Committee at any time. A member may resign at any time by written notice to the Committee. If a vacancy in the Committee should occur, a successor shall be appointed by the Company.
(c) The Company may appoint a Chairman and a Secretary from among the members of the Committee. All resolutions, determinations and other actions shall be by a majority vote of all members of the Committee. Any individual member of the Committee shall have the authority to take any action on behalf of the Committee which such member determines in good faith to be ministerial in nature, or which is necessary or appropriate to carry out determinations of the Committee, or to protect the Plan and the Fund in a situation in which it is not practical to convene a meeting of the Committee. The Committee may appoint such agents, who need not be members of the Committee, as it deems necessary for the effective performance of its duties, and may delegate to such agents such powers and duties, whether ministerial or discretionary, as the Committee deems expedient or appropriate. The compensation of such agents shall be fixed by the Committee; provided, however, that in no event shall compensation be paid if such payment
46
violates the provisions of Section 406 of the Act and is not exempted from such prohibitions by Section 408 of the Act.
(d) The Plan Administrator shall be the “plan administrator” and the “administrator” as defined in Code Section 414(g) and Section 3(16)(A) of the Act, shall have complete control of the administration of the Plan, with all powers necessary to enable it to properly carry out the provisions of the Plan and not inconsistent with any of the provisions hereof, whether or not such powers and duties are specifically set forth herein. In furtherance thereof, the Committee shall have the discretionary authority to determine all questions arising in administration of the Plan and to determine all facts pertinent thereto, including without limitation the power to determine the rights or eligibility of Employees, Participants, and their Beneficiaries, and the amount and form of their respective interests; and the decision thereon of the Committee shall be final and conclusive and binding upon all persons to the extent permitted by law. Not in limitation but in amplification of the foregoing, the Committee shall have the following specific powers and responsibilities:
(i) To adopt such rules, procedures and regulations as in its opinion may be necessary for the proper and efficient administration of the Plan, which may alter any provision of the Plan that is ministerial or administrative in nature (including the time or method for performing any act) without the need for a formal amendment;
(ii) to keep records of all acts and determinations of the Committee, and to keep all such records, books of accounts, data and other documents as may be necessary for the proper administration of the Plan;
(iii) to prepare and distribute to all Plan Participants and Beneficiaries information concerning the Plan and their rights under the Plan, including, but not limited to, all information which is required to be distributed by the Act, the regulations thereunder, or by any other applicable law;
(iv) to file with the Secretary of Labor such reports and additional documents as may be required by the Act and regulations issued thereunder, including, but not limited to, a plan description, annual reports, terminal reports and supplementary reports;
(v) to file with the Secretary of the Treasury and the Pension Benefit Guaranty Corporation all reports and information required to be filed by the Internal Revenue Code, the Act and regulations issued under each;
(vi) to exercise any authority of a “plan administrator” or an “administrator” as defined in Code Section 414(g) and Section 3(16)(A) of the Act; and
(vii) to do all things necessary to operate and administer the Plan in accordance with its provisions and in compliance with applicable provisions of federal law.
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(e) To enable the Committee to perform its functions, the Company shall supply, or cause to be supplied, full and timely information of all matters relating to the compensation and length of service of all Participants, their retirement, death or other cause of termination of employment, and such other pertinent facts as the Committee may require. The Committee shall advise the Trustee of such facts and issue to the Trustee such instructions as may be required by the Trustee in the administration of the Plan. The Committee and the Company shall be entitled to rely upon all certificates and reports made by a Certified Public Accountant selected or approved by the Company. The Committee, the Company and its officers and the Trustee, shall be fully protected in respect of any action suffered by them in good faith in reliance upon the advice or opinion of any accountant or attorney, and all action so taken or suffered shall be conclusive upon each of them and upon all other persons interested in the Plan.
(f) The Company, by action of its Board of Trustees, Chief Executive Officer, or any person to whom the Board of Trustees or Chief Executive Officer has delegated such authority, may designate any person or committee other than the Committee to exercise any of its authority as plan administrator. If at any time a Committee has not been appointed, or for any reason is not functioning, under this Section 7.04, and no other officer has been specifically designated, the authority of the Company as plan administrator shall be exercised by the Company’s senior officer responsible for human resources, or persons acting under such officer’s authority and supervision. In such event, all references in this Plan or the Trust to the “Committee” shall be deemed to refer instead to the person or body so authorized to exercise the Company’s authority as plan administrator. Even if the Committee is functioning, such officer, or persons acting under his authority and supervision, may also exercise any authority of the Plan Administrator that is necessary or convenient for the routine administration and maintenance of the Plan or the protection of Plan assets, and any such exercise of authority by a person acting within the scope of his normal duties shall be presumed authorized, subject to the review of his supervisors and the Committee.
7.05 Standard of Fiduciary Duty . Any Fiduciary, or any person designated by a Fiduciary to carry out fiduciary responsibilities with respect to the Plan, shall discharge his duties solely in the interests of the Participants and Beneficiaries for the exclusive purpose of providing them with benefits and defraying the reasonable expenses of administering the Plan. Any Fiduciary shall discharge his duties with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent man acting in a like capacity and familiar with such matter would use in the conduct of an enterprise of a like character and with like aims. Any Fiduciary shall discharge his duties in accordance with the documents and instruments governing the Plan insofar as such documents and instruments are consistent with the provisions of the Act. Notwithstanding any other provisions of the Plan, no Fiduciary shall be authorized to engage in any transaction which is prohibited by Section 406 of the Act, or Section 4975 of the Code, in the performance of its duties hereunder.
7.06 Claims Procedure . Any Participant, Former Participant, Beneficiary or authorized representative of any such person (hereinafter referred to as “Claimant”), may file a claim for benefits under the Plan by submitting to the Committee a written statement describing the nature of the claim and requesting a determination of its validity under the terms of the Plan. Within 90 days after the date such claim is received by the Committee, it shall issue a ruling with respect to the claim. Such 90 day period may be extended by up to an additional 90 days if notice of the
48
extension is given to the Claimant by the end of the first 90 day period. If the claim is wholly or partially denied, written notice shall be furnished to the Claimant, which notice shall set forth in a manner calculated to be understood by the Claimant:
(i) the specific reason or reasons for denial;
(ii) specific reference to pertinent Plan provisions on which the denial is based;
(iii) A description of any additional material or information necessary for the Claimant to perfect the claim and an explanation of why such material or information is necessary;
(iv) an explanation of the claims review procedures and the time limits applicable to such procedures; and
(v) for claims filed on or after January 1, 2002, an explanation of the Claimant’s right to bring an action under Section 502(a) of the Act following an adverse determination on review.
For any claim that involves a determination of Permanent Disability, the Committee shall issue a ruling with respect to the claim within 45 days after the date such claim is received by the Committee. This period may be extended for up to 30 days if notice of the extension is given to the Claimant by the end of the first 45 day period. If, prior to the end of the first 30 day extension period, the Plan Administrator determines that, due to matters beyond the control of the Plan, a decision cannot be rendered within that extension period, the period for making the determination may be extended for up to an additional 30 days, provided that the Plan Administrator notifies the claimant, prior to the expiration of the first 30 day extension period, of the circumstances requiring the extension and the date as of which the plan expects to render a decision. In the case of any extension under this paragraph, the notice of extension shall specifically explain the standards on which entitlement to a benefit is based, the unresolved issues that prevent a decision on the claim, and the additional information needed to resolve those issues, and the Claimant shall be afforded at least 45 days within which to provide the specified information.
Any Claimant whose claim for benefits has been denied, may appeal such denial by resubmitting to the Committee, within 60 days of the date the Claimant receives notice of such denial, a written statement requesting a further review of the decision. Such statement shall set forth the reasons supporting the claim, the reasons such claim should not have been denied, and any other issues or comments which the Claimant deems appropriate with respect to the claim.
If the Claimant shall request in writing, the Committee shall make available for examination of the Claimant free of charge, reasonable access to and copies of the Plan documents and any other evidence which was considered by the Committee and pertinent to his claim or, effective for claims filed on or after January 1, 2002, any documents, records or other information that is relevant to his claim.
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Within 60 days after the request for further review is received, the Committee shall review its determination of benefits and the reasons therefor and notify the Claimant in writing of its final decision. Such 60 day period may be extended by up to an additional 60 days if the Committee determines that such extension is necessary and notice of the extension is given to the Claimant by the end of the first 60 day period Such written notice shall include specific reasons for the decision, written in a manner calculated to be understood by the Claimant, with specific references to the pertinent Plan provisions on which the decision is based.
Article 8
AMENDMENT AND TERMINATION
8.01 Right to Amend . The Company intends for the Plan to be permanent so long as the Company exists; however, it reserves the right to modify, alter, or amend this Plan from time to time, to any extent that it may deem advisable, including, but not limited to any amendment deemed necessary to insure the continued qualification of the Plan under Section 401(a) of the Code or to insure compliance with the Act; provided, however, that the Employer shall not have the authority to amend the Plan in any manner which will:
(i) Permit any part of the Fund (other than such part as is used to pay taxes and administrative expenses) to be used for or diverted to purposes other than for the exclusive benefit of the Participants or their Beneficiaries;
(ii) Cause or permit any portion of the assets of the Fund to revert to or become the property of the Employer, other than as already provided under the Plan;
Amendments to the Plan shall be adopted by the Board of Trustees of the Company or any person to whom the Board may delegate the authority to amend; provided that the Chief Executive Officer of the Company or the senior officer of the Company responsible for human resources matters may approve any amendment to the Plan that he reasonably determines to be administrative, ministerial or technical in nature, necessary or appropriate to implement a resolution adopted by the Board of Trustees, or necessary to preserve the tax qualified status of the Plan or comply with any applicable law.
8.02 Termination and Discontinuance of Contributions.
(a) The Company shall have the right at any time to terminate this Plan or to discontinue permanently its contributions hereunder (hereinafter referred to as a “Plan Termination”). Plan Termination shall be effective as of the date stated in a resolution of the Company (or its designated agent) to that effect.
(b) Subject to the provisions of Subsection (c) below, the Plan will terminate as to an individual Employer on the first to occur of the following:
(i) The date it is terminated by that Employer if thirty days’ advance written notice of the termination is given to the Committee, the Trustees and the other Employers.
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(ii) The date it is terminated with respect to that Employer by the Company, if thirty days’ advance written notice of the termination is given to that Employer, the Committee, the Trustees and the other Employers.
(iii) The date that Employer is judicially declared bankrupt or insolvent.
(iv) The date that Employer completely discontinues its contributions under the Plan.
(v) The dissolution, liquidation, merger, consolidation or reorganization of that Employer, or the sale by that Employer of all or substantially all of its assets.
(c) The provisions of Subsection (b) above shall be subject to the following:
(i) If an Employer is dissolved, liquidated, merged, consolidated or reorganized, or if an Employer sells all or substantially all of its assets, arrangements may be made with the consent of the Company whereby the Plan will be continued by any successor to that Employer or any purchaser of all or substantially all of that Employer’s assets, in which event the successor or purchaser will be substituted for that Employer under the Plan and the Plan shall continue in effect without a termination thereof as to that Employer.
(ii) If any Employer is dissolved, liquidated, merged or in any way reorganized into, or is consolidated with, any other Employer, the Plan as applied to the former Employer will automatically continue in effect without a termination thereof.
(iii) If any of the events described in Subsection (b) should occur but some or all of the Participants employed by the Employer are transferred to employment with one or more other Employers coincident with or immediately following the occurrence of such event, the Plan as applied to those Participants will automatically continue in effect without a termination thereof.
(d) If the Plan as applied to all Employers, or as applied to any individual Employer, is terminated or partially terminated for any reason, or contributions to the Plan are discontinued, the date of such termination or partial termination or complete discontinuance of contributions shall be a Valuation Date and all adjustments required under the Plan as of a Valuation Date which is the last day of the Plan Year then shall be made. The Accounts of Participants with respect to whom there has been a termination of the Plan or a partial termination of the Plan shall become nonforfeitable as of that date.
(e) The termination or discontinuance pursuant to this Section shall not terminate the Trust or operate to accelerate any payments or distributions hereunder, and the Trustee shall continue to administer the Trust in accordance with its terms and the provisions hereof. Notwithstanding the foregoing, on and after the date of termination of the Plan or permanent
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discontinuance of contributions, as aforesaid, the Committee, in its discretion, may, subject to Section 401(k)(10) of the Code, provide for distributions of the amounts in the Accounts of any Participant at the end of any Plan Year before the occurrence of any of the events described in Article 6 which trigger distribution rights. At such time as settlement has been completed with respect to all persons entitled to any portion of the Trust Fund, the Trust shall terminate and the Trustee shall be discharged.
Article 9
MISCELLANEOUS
9.01 Headings . The headings and subheadings in this Plan have been inserted for convenience of reference only and are to be ignored in any construction of the provisions hereof.
9.02 Action by Employer . Any action by an Employer under this Plan shall be by resolution of the Employer, by its board of directors or trustees, if applicable, or by any person or persons duly authorized to take such action.
9.03 Spendthrift Clause . Except as otherwise provided by law, none of the benefits, payments, proceeds or distributions under this Plan shall be subject to the claim of any creditor of any Participant or Beneficiary, or to any legal process by any creditor of such Participant or Beneficiary, and none of them shall have any right to alienate, commute, anticipate or assign any of the benefits, payments, proceeds or distributions under this Plan, except to the extent expressly provided herein to the contrary.
This Section shall not apply to any benefit payable under the Plan to a Participant to the extent such benefit is payable, in whole or in part, to any person other than a Participant or Beneficiary pursuant to a “qualified domestic relations order” (as defined in Section 414(p) of the Code). The Committee shall adopt rules for determining whether a court order is a “qualified domestic relations order” and for administering benefits and Plan assets pending such determinations and pursuant to “qualified domestic relations orders.” Amounts may be distributed pursuant to a qualified domestic relations order notwithstanding the fact that the Participant has not incurred a Termination of Employment or attained the age of 55.
9.04 Discrimination . The Company, the Committee, the Trustee and all other persons involved in the administration and operation of the Plan shall administer and operate the Plan and Trust in a uniform and consistent manner with respect to all Participants similarly situated and shall not permit discrimination in favor of officers, stockholders, or highly paid Employees.
9.05 Release . Any payment to a Participant or Beneficiary, or to their legal representatives, in accordance with the provisions of this Plan, shall to the extent thereof be in full satisfaction of all claims hereunder against the Trustee, Committee and any Employer, any of whom may require such Participant, Beneficiary, or legal representative, as a condition precedent to such payment, to execute a receipt and release therefor in such form as shall be determined by the Trustee, the Committee or the Employer, as the case may be.
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9.06 Compliance with Applicable Laws . The Committee shall interpret and administer the Plan in such manner that the Plan and Trust shall remain in compliance with the Code, the Act and all other applicable laws, regulations, and rulings.
9.07 Agent for Service of Process . The agent for service of process of this Plan shall be the person listed from time to time in the current records of the Secretary of State of Illinois as the agent for the service of process for The Equity Residential Properties Trust.
9.08 Merger .
(a) In the event of any merger or consolidation of the Plan with any other qualified plan, or the transfer of assets or liabilities between the Plan and any other qualified plan, each affected participant must receive (assuming that the recipient plan would terminate) the benefit immediately after the merger, consolidation, or transfer that is equal to or greater than the benefit such participant would have been entitled to receive immediately before the merger, consolidation, or transfer (assuming that the plan in which the participant had been participating had then terminated).
(b) No cutback in accrued benefit rights that would violate Section 411(d)(6) of the Code shall be permitted in connection with any merger, consolidation or transfer under this Section 9.08 and any accrued benefit rights set forth in any other plan and not specifically set forth in this Plan shall be deemed incorporated into this Plan, solely to the extent necessary to satisfy the condition of this sentence.
9.09 Governing Law . The Plan shall be governed by the laws of the State of Illinois to the extent that such laws are not preempted by Federal law.
9.10 Absence of Guarantee . Neither the Fiduciaries nor the Employers in any way guarantee the Trust Fund from loss or depreciation. While it is the intention of the Employers that the Plan be permanent, the Employers do not guarantee the continuation thereof or contributions thereto for any Plan Year. All payments to be made under the Plan shall be made solely out of the Trust Fund and neither the Employers nor the Trustee in any way guarantee, or shall be personally responsible for, the payment of any amount which may be or become due to any person from the Trust Fund. The Employers and the Committee shall not incur any liability for any act or omission of any Trustee, nor shall any Trustee incur any liability for any act or omission of the Employers or the Committee or of another Trustee.
9.11 Litigation . In any action or proceeding regarding the assets or administration of the Plan, Participants, Employees or former Employees, Beneficiaries or any other persons having or claiming to have an interest in the Plan shall not be necessary parties and shall not be entitled to any notice or process. Any final judgment which is not appealed or appealable and may be entered in any such action or proceeding shall be binding and conclusive on the parties hereto and all persons having or claiming to have any interest in this Plan. To the extent permitted by law, if a legal action is begun against the Company, any Employer, the Trustee, members of the Committee, or their respective employees or agents by or on behalf of any person, and such action results adversely to such person, or if a legal action arises because of conflicting claims to a Participant’s or other person’s benefits, the costs to such person defending
53
the action will be charged to the amounts, if any, which were involved in the action or were payable to the Participant or other person concerned. To the extent permitted by applicable law, acceptance of participation in this Plan shall constitute a release of the Company, each Employer, the Trustee, the members of the Committee and their respective employees and agents from any and all liability and obligation not involving willful misconduct or gross neglect.
Article 10
TOP HEAVY RULES
10.01 General Rule . If the Plan is or becomes top-heavy in any Plan Year, the provisions of this Article 10 will supersede any conflicting provision in the Plan.
10.02 Definitions.
(a) Key Employee , effective January 1, 2002, shall mean any Employee or former Employee (and the Beneficiaries of such Employee) who at any time during the Plan Year was an officer of an Employer whose annual compensation exceeded $130,000 (as indexed pursuant to Section 416(i) of the Code, a 5-percent owner of an Employer, or a 1-percent owner of an Employer who has annual compensation of more than $150,000. Not more than 50 Employees (or, if less, the greater of three or 10 percent of all Employees) shall be treated as officers. The determination of who is a Key Employee will be made in accordance with Section 416(i)(1) of the Code and the regulations thereunder.
(b) Top-Heavy Plan : For any Plan Year, this Plan is top-heavy if any of the following conditions exist:
(i) If the Top-Heavy Ratio for this Plan exceeds 60 percent and this Plan is not part of any Required Aggregation Group or Permissive Aggregation Group of plans.
(ii) If this Plan is a part of a Required Aggregation Group of plans but not part of a Permissive Aggregation Group and the Top-Heavy Ratio for the Required Aggregation Group of plans exceeds 60 percent.
(iii) If this Plan is a part of a Required Aggregation Group and part of a Permissive Aggregation Group of plans and the Top-Heavy Ratio for the Permissive Aggregation Group exceeds 60 percent.
(c) Permissive Aggregation Group : The Required Aggregation Group of plans, plus any other plan or plans of the Employer which, when considered as a group with the Required Aggregation Group, would continue to satisfy the requirements of Sections 401(a)(4) and 410 of the Code.
(d) Required Aggregation Group : (1) Each qualified plan of the Employer in which at least one Key Employee participates, and (2) any other qualified plan of the Employer which enables a plan described in (d)(1) to meet the requirements of Sections 401(a)(4) or 410 of the Code.
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(e) Top-Heavy Ratio : The Top-Heavy Ratio for any Plan Year is the ratio of the total account balances of all Key Employees to the total account balances of all Participants as of the last day of the immediately preceding Plan Year. Any distribution made to an Employee within one year prior to such date (five years if the distribution was made for any reason other than separation from service, disability or death), including any distribution from a terminated plan which, if it had not been terminated, would be part of a Required Aggregation Group, shall be included in the Employee’s account balance. If any defined benefit plan is included in an Aggregation Group, the present value of benefits under such plan, determined using the actuarial assumptions in effect under such plan, shall be used instead of account balances.
(f) Compensation : For purposes of this Article 10, compensation shall mean all amounts paid or made available to the Participant by the Employer during the Plan Year for services as an Employee as reported on Form W-2 (or such other form as may be prescribed pursuant to §6041(d) and §6051(a)(3) of the Code). Compensation shall also include any elective contributions excluded from income under §125 of the Code (relating to cafeteria plans), §402(e)(3) of the Code (relating to 401(k) plans), including Pre-Tax Contributions under this Plan, §402(h) of the Code (relating to simplified employee pension plans), or §132(f)(4) of the Code (relating to elective transportation fringe benefits).
Any Employee’s compensation for any Plan Year in excess of $170,000 (or such other amount provided pursuant to Section 401(a)(17) of the Code) shall be disregarded for all purposes under the Plan. Effective January 1, 2002, $200,000 shall be substituted for $170,000 in the preceding sentence. If an Employee receives compensation from more than one Employer for a Plan Year, then his compensation from all such Employers shall be aggregated for purposes of applying the limit of Section 401(a)(17) of the Code for that Plan Year. Commencing January 1, 1997, the rules requiring the aggregation of compensation paid to certain family members of Highly Compensated Employees as set forth in the Plan prior to the Effective Date shall no longer apply.
10.03 Minimum Allocation.
(a) The Employer Contributions, less Forfeitures allocated under Section 6.06, allocated on behalf of any Participant who is not a Key Employee shall not be less than the lesser of three percent (3%) of such Participant’s Compensation or, in the case where the Employer has no defined benefit plan which designates this Plan to satisfy Section 401 of the Code, the largest percentage of Employer Contributions and Forfeitures, as a percentage of the Key Employee’s Compensation, allocated on behalf of any Key Employee for that year. The minimum allocation (to be known as the “Employer Top-Heavy Contribution”) is determined without regard to any Social Security contribution. The Employer Top-Heavy Contribution shall be made even though, under other Plan provisions, the Participant would not otherwise be entitled to receive an allocation, or would have received a lesser allocation for the year because of (i) the Participant’s failure to complete 1,000 Hours of Service (or any equivalent provided in the Plan), (ii) the Participant’s failure to make Employee Contributions to the Plan, or (iii) Compensation less than a stated amount.
(b) The provisions of paragraph (a) above shall not apply to any Participant who was not employed by an Employer on the last day of the Plan Year.
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10.04 Nonforfeitability of Employer Top-Heavy Contribution . To the extent it is required to be nonforfeitable under Section 416(b) of the Code, any Employer Top-Heavy Contribution may not be forfeited under Sections 411(a)(3)(B) or 411(a)(3)(D) of the Code.
10.05 Vesting . For any Plan Year in which the Plan is top-heavy, the vesting schedules with respect to Employer Profit Sharing and Matching Contributions shall be based on completed Years of Credited Service then standing to the Participant’s credit:
|
Years of Credited Service |
|
Vested Percentage |
|
0-1 |
|
0% |
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No change in the vesting schedule due to this Section shall operate to reduce any Participant’s vested interest in any of his Accounts.
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IN WITNESS WHEREOF, the Company has caused this amended and restated Plan to be executed below by its duly authorized officers on this 1 day of January, 2004, to be effective as of January 1, 2004.
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EQUITY RESIDENTIAL |
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/s/ Catherine M. Carraway |
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Its: |
1 st VP HR Operations |
SCHEDULE B
PARTICIPATING EMPLOYERS
Equity Residential
Equity Residential Properties Management Corp.
Evans Withycombe Management
Equity Corporate Housing, Inc.
THE EQUITY RESIDENTIAL PROPERTIES TRUST
ADVANTAGE RETIREMENT SAVINGS PLAN
(Amendment and Restated Effective January l, 2004)
Exhibit 10.12
FIRST AMENDMENT
THE EQUITY RESIDENTIAL PROPERTIES
ADVANTAGE RETIREMENT SAVINGS PLAN
WHEREAS, Equity Residential Properties Trust (the “Trust”) maintains the Equity Residential Properties Trust Advantage Retirement Savings Plan (the “Plan”), as last amended and restated effective January 1, 2004, for the benefit of its eligible employees;
WHEREAS, Section 8.01 of the Plan provides that the Trust may amend the Plan at any time; and
WHEREAS, the Trust desires to amend the Plan to comply with Section 401(a)(31)(B) of the Internal Revenue Code as amended by the Economic Growth and Tax Relief Reconciliation Act of 2001 (“EGTRRA”);
WHEREAS, the Trust desires to further amend the Plan to increase matching contributions;
NOW, THEREFORE, the Trust hereby amends the Plan as follows effective as of the date listed for each item below:
1. Effective as of March 28, 2005, the first paragraph of Section 6.07(d) of the Plan is amended to read as follows:
(d) If the distributable balance in a terminated Participant’s Account, or the portion thereof payable to a Beneficiary does not exceed $5,000, the total remaining balance shall be distributed to the Participant or Beneficiary in a single lump sum as soon as administratively practicable following the Participant’s Termination of Employment. Notwithstanding any contrary provision of the Plan, in the event of a mandatory distribution to a Participant greater than $1,000 in accordance with the provisions of this Section 6.07(d), if the Participant does not elect to have such distribution paid directly to an eligible retirement plan specified by the Participant in a direct rollover or to receive the distribution directly, then the Plan Administrator will pay the distribution in a direct rollover to an individual retirement plan designated by the Plan Administrator. Further, distribution to an alternate payee pursuant to a QDRO may be made as soon as administratively practicable following the alternate payee’s written request for the distribution in accordance with the terms of the QDRO.
2. Effective as of March 28, 2005, Section 6.07(f) of the Plan is amended to read as follows:
(f) The account balances of former employees of Cardinal Industries, Inc. that were transferred to this Plan upon the merger of the Cardinal Plan and do not exceed $5,000 shall be distributed to such for employees in a single lump sum as soon as administratively feasible following the merger. To the extent the Plan Administrator is unable to locate any such former employee; his account balance shall be forfeited and reallocated, subject to restoration, as provided in Section 6.11. Notwithstanding the foregoing, effective March 28, 2005, any distributions made to such former employees shall be made in accordance with Section 6.07(d) hereof.
3. Effective as of January 1, 2005, Section 4.04 of the Plan is amended to read as follows:
4.04 Employer Matching Contributions
Each Employer shall make Employer Matching Contributions on behalf of each of the Participants who is eligible to participate in Employer Profit-Sharing Contributions for the Plan Year (regardless of whether any Employer Profit-Sharing Contributions are actually made by such Employer). In addition, each Employer shall make an Employer Matching Contribution on behalf of each Participant who transferred from such Employer to a Trust listed on Schedule A provided that such Participant remained employed by such Trust as of his last scheduled work day of the Plan Year, or terminated such employment because he incurred a Retirement, died or had a Termination of Employment due to a Permanent Disability during such Year. Each Employer shall contribute on behalf of each such Participant an amount equal to the Participant’s Pre-Tax Contributions made while the Participant was employed by such Employer to the extent they do not exceed 3% of the Participant’s Compensation earned while the Participant was employed by such Employer for the Plan Year. In addition to the foregoing, each Employer shall make supplemental matching contributions with respect to any Participant returning from Qualified Military Service based upon the supplemental Pre-Tax Contributions the Participant elects to make pursuant to Section 4.01(h), equal to the amount of Employer Matching Contributions the Participant would have received had such Pre-Tax Contributions been made during his period of Qualified Military Service. Notwithstanding the foregoing, Employer Matching Contributions shall not be made to the Plan with respect to a Participant to the extent that such contributions would cause the limitations set forth in Section 4.08(d) hereof to be exceeded for such Participant with respect to the year for which such contributions are made.
IN WITNESS WHEREOF , the Trust has caused this First Amendment to be executed by its duly authorized officers on this 25 day of April 2005.
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/s/ Catherine M. Carraway |
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Title: |
First Vice President, HR Operations |
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Exhibit 10.13
SECOND AMENDMENT
EQUITY RESIDENTIAL
ADVANTAGE RETIREMENT SAVINGS PLAN
WHEREAS, Equity Residential (the “Company”) maintains the Equity Residential Advantage Retirement Savings Plan (the “Plan”), as last amended and restated effective January 1, 2004, for the benefit of its eligible employees;
WHEREAS, Section 8.01 of the Plan provides that the Company may amend the Plan at any time; and
WHEREAS, the Company desires to amend the Plan to comply with Section 401(a)(31)(B) of the Internal Revenue Code as amended by the Economic Growth and Tax Relief Reconciliation Act of 2001 (“EGTRRA”);
WHEREAS, the Company desires to further amend the Plan to increase matching contributions;
NOW, THEREFORE, the Company hereby amends the Plan as follows effective as of the date listed for each item below:
1. Effective as of March 28, 2005, the first paragraph of Section 6.07(d) of the Plan is amended to read as follows:
(d) If the distributable balance in a terminated Participant’s Account, or the portion thereof payable to a Beneficiary does not exceed $5,000, the total remaining balance shall be distributed to the Participant or Beneficiary in a single lump sum as soon as administratively practicable following the Participant’s Termination of Employment. Notwithstanding any contrary provision of the Plan, in the event of a mandatory distribution to a Participant greater than $1,000 in accordance with the provisions of this Section 6.07(d), if the Participant does not elect to have such distribution paid directly to an eligible retirement plan specified by the Participant in a direct rollover or to receive the distribution directly, then the Plan Administrator will pay the distribution in a direct rollover to an individual retirement plan designated by the Plan Administrator. Further, distribution to an alternate payee pursuant to a QDRO may be made as soon as administratively practicable following the alternate payee’s written request for the distribution in accordance with the terms of the QDRO.
2. Effective as of March 28, 2005, Section 6.07(f) of the Plan is amended to read as follows:
(f) The account balances of former employees of Cardinal Industries, Inc. that were transferred to this Plan upon the merger of the Cardinal Plan and do not exceed $5,000 shall be distributed to such for employees in a single lump sum as soon as administratively feasible following the merger. To the extent the Plan Administrator is unable to locate any such former employee, his account balance shall be forfeited and reallocated, subject to restoration, as provided in Section 6.11. Notwithstanding the
foregoing, effective March 28, 2005, any distributions made to such former employees shall be made in accordance with Section 6.07(d) hereof.
3. Effective as of January 1, 2005, Section 4.04 of the Plan is amended to read as follows:
4.04 Employer Matching Contributions
Each Employer shall make Employer Matching Contributions on behalf of each of the Participants who is eligible to participate in Employer Profit-Sharing Contributions for the Plan Year (regardless of whether any Employer Profit-Sharing Contributions are actually made by such Employer). In addition, each Employer shall make an Employer Matching Contribution on behalf of each Participant who transferred from such Employer to a company listed on Schedule A provided that such Participant remained employed by such company as of his last scheduled work day of the Plan Year, or terminated such employment because he incurred a Retirement, died or had a Termination of Employment due to a Permanent Disability during such Year. Each Employer shall contribute on behalf of each such Participant an amount equal to the Participant’s Pre-Tax Contributions made while the Participant was employed by such Employer to the extent they do not exceed 3% of the Participant’s Compensation earned while the Participant was employed by such Employer for the Plan Year. In addition to the foregoing, each Employer shall make supplemental matching contributions with respect to any Participant returning from Qualified Military Service based upon the supplemental Pre-Tax Contributions the Participant elects to make pursuant to Section 4.01(h), equal to the amount of Employer Matching Contributions the Participant would have received had such Pre-Tax Contributions been made during his period of Qualified Military Service. Notwithstanding the foregoing, Employer Matching Contributions shall not be made to the Plan with respect to a Participant to the extent that such contributions would cause the limitations set forth in Section 4.08(d) hereof to be exceeded for such Participant with respect to the year for which such contributions are made.
IN WITNESS WHEREOF , the Company has caused this First Amendment to be executed by its duly authorized officers on this 30 day of April 2005.
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EQUITY RESIDENTIAL |
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/s/ Catherine Carraway |
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Title: |
First VP, HR Operations |
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Exhibit 10.19
FIFTH AMENDMENT TO EQUITY RESIDENTIAL 2002 SHARE INCENTIVE PLAN
THIS FIFTH AMENDMENT (the “Fifth Amendment”) to EQUITY RESIDENTIAL 2002 SHARE INCENTIVE PLAN (“Plan”) is executed as of the 1 st day of October, 2006.
RECITALS
WHEREAS, the Board of Trustees of Equity Residential (the “Company”) adopted the Plan on February 21, 2002, which was approved by the shareholders of the Company at the 2002 annual meeting.
WHEREAS, the Company entered into a First Amendment to the Plan dated as of February 7, 2003, a Second Amendment to the Plan dated as of June 10, 2003, a Third Amendment to the Plan dated as of April 25, 2005 and a Fourth Amendment to the Plan dated as of February 1, 2006.
WHEREAS, the Company desires to further amend the Plan pursuant to this Fifth Amendment to make a minor modification to ensure compliance with current stock option accounting rules.
NOW THEREFORE, the Plan is further amended as follows:
1. AMENDMENTS . The first sentence of Section 13 of the Plan is hereby amended by deleting the word “may” in the seventh line thereof and replacing it with the word “shall”.
2. PLAN IN FULL FORCE AND EFFECT . After giving effect to this Fifth Amendment, the Plan remains in full force and effect.
IN WITNESS WHEREOF, this Fifth Amendment has been executed as of the date first written above.
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EQUITY RESIDENTIAL |
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/s/ Bruce C. Strohm |
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Bruce C. Strohm |
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Executive Vice President and General Counsel |
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Exhibit 10.20
SECOND AMENDMENT TO EQUITY RESIDENTIAL
1993 SHARE OPTION AND SHARE AWARD PLAN
THIS SECOND AMENDMENT (the “Second Amendment”) to EQUITY RESIDENTIAL 1993 SHARE OPTION AND SHARE AWARD PLAN is executed as of the 1 st day of October, 2006.
RECITALS
WHEREAS, the Board of Trustees of Equity Residential (the “Company”) adopted the 1993 Share Option and Share Award Plan on May 21, 1993.
WHEREAS, the Company amended and restated the 1993 Share Option and Share Award Plan effective as of February 21, 2002 (as amended and restated, the “Plan”).
WHEREAS, the Company entered into a First Amendment to the Plan dated as of June 10, 2003.
WHEREAS, the Company desires to further amend the Plan pursuant to this Second Amendment to make a minor modification to ensure compliance with current stock option accounting rules.
NOW THEREFORE, the Plan is further amended as follows:
1. AMENDMENTS . The first sentence of Section 13 of the Plan is hereby amended by deleting the word “may” in the seventh line thereof and replacing it with the word “shall”.
2. PLAN IN FULL FORCE AND EFFECT . After giving effect to this Second Amendment, the Plan remains in full force and effect.
IN WITNESS WHEREOF, this Second Amendment has been executed as of the date first written above.
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EQUITY RESIDENTIAL |
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/s/ Bruce C. Strohm |
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Bruce C. Strohm |
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Executive Vice President and General Counsel |
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Exhibit 10.24
EXECUTIVE RETIREMENT BENEFITS AGREEMENT
This EXECUTIVE RETIREMENT BENEFITS AGREEMENT (“Agreement”) is entered into by and between Equity Residential Properties Trust, a Maryland real estate investment trust (“Trust”) and (“Executive”).
WHEREAS, in recognition of the contributions made to Trust by Executive during his or her period of service as an executive officer of Trust; and
WHEREAS, Trust and Executive desire to enter into this Agreement to provide for the extension of health benefits and life insurance benefits to Executive upon Executive’s retirement from Trust, and Executive is willing to enter into this Agreement on the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual promises and considerations contained herein and for other good and valuable consideration, the payment and adequacy of which is hereby acknowledged, the parties agree as follows:
1. Term of Agreement . This Agreement shall commence as of the date hereof and shall continue in effect until the date Executive’s employment is terminated; provided, however if Executive’s employment is terminated by reason of (i) Executive’s retirement from Trust after reaching the age of 62 or older, or (ii) a Change in Control, after Executive’s reaching age 62 or older, the term shall continue in effect until all benefits have been made or provided to Executive hereunder.
2. Definitions. For purposes of this Agreement, the following terms shall have the meanings set forth below:
(a) Change in Control. “Change in Control” shall mean any of the events described in the Change in Control Agreement, as may be amended from time to time, entered into by and between Executive and Trust.
(b) Health Benefits . “Health benefits” shall mean the medical, dental and vision benefits provided (i) to Executive, the Executive’s spouse, and eligible dependents immediately prior to Executive’s retirement or (ii) to other similarly situated executives in the employ of Trust.
(c) Life Insurance Benefits . “Life insurance benefits” shall mean the basic life and accidental death and dismemberment benefits provided (i) to Executive immediately prior to Executive’s retirement or (ii) to other similarly situated executives in the employ of Trust.
3. Continuation of Benefits. If, during the term of this Agreement, after reaching the age of 62 or older (i) Executive retires from Trust or (ii) Executive’s employment with Trust’s affiliate is terminated following a Change in Control, Executive shall be entitled to continuation of health benefits and life insurance benefits commencing on the day immediately following the date of Executive’s retirement or termination, as the case may be, and continuing until the date of the death of Executive (the “Continuation Period”); provided, however, during the Continuation Period Executive and Trust will share responsibility for the payment of premiums required to maintain health benefits at the same rate for the coverage elected by Executive as would be payable by any regular active employee for the same coverage, from time to time throughout the Continuation Period. The death of Executive will be a COBRA qualifying event.
4. Assignment. Trust may not assign this Agreement, or any rights, duties or obligations hereunder, except that Trust’s rights, duties, and obligations shall be binding obligations of any successor of Trust. No interest of Executive (or Executive’s spouse or eligible dependents) nor any right to receive any benefit hereunder shall be subject to sale, transfer, assignment, pledge, attachment or garnishment or otherwise be assigned or encumbered. No such interest or right shall be taken, voluntarily or involuntarily, for the satisfaction of the obligations or debts, of, or other claims against, Executive (or Executive’s spouse or eligible dependents), including claims for alimony, Child support, separate maintenance and claims in bankruptcy.
5. Source of Payment. The rights created under this Agreement are unfunded promises to provide benefits described herein in the event of the termination of Executive’s employment under the circumstances described in Paragraph 1. Trust or the successor of Trust shall not segregate assets for purposes of payment for any benefits due hereunder, nor shall any provision contained herein be interpreted to require the Trust or the successor of Trust to segregate assets for purposes of providing payment of any benefit hereunder. Neither Executive, Executive’s spouse, or any eligible dependent shall have any interest in or right against any specific assets of Trust or the successor of Trust, and any rights shall be limited to those of a general unsecured creditor.
6. Miscellaneous.
(a) Entire Agreement; Amendment. This Agreement contains the entire Agreement and understanding between Trust and Executive and supersedes all other agreements, written or oral, relating to the subject matter contained herein. Any amendment or modification of the terms of this Agreement must be in writing and signed by the Trust or the successor of Trust and Executive to have any binding effect upon the parties.
(b) Applicable Law. Except to the extent preempted by federal law, this Agreement is governed by, and shall be construed and interpreted in accordance with the substantive laws of the State of Illinois, not including the choice of law provisions thereof.
(c) No Employment Rights. Nothing contained herein shall be construed to confer upon Executive any right to continue in the employment of Trust’s affiliate, Equity Residential Properties Management Corp. (“Equity”) or a successor of Trust or Equity, or to limit the right of Trust, Equity or a successor of Trust or Equity to terminate Executive’s employment at any time, with or without cause.
(d) Notices. Notices under this Agreement shall be in writing and sent by registered mail, return receipt requested, to the following addresses or to such other address that may be furnished in writing to the other party. If to Executive, notices shall be sent to Executive’s address on file in Trust’s Human Resources Department. If to Trust or the successor of Trust:
Two
North Riverside Plaza
Suite 400
Chicago, IL 60606
Attention: General Counsel
Notices sent as described above shall be deemed received three business days after being so sent.
(e) Severability. If any provision contained herein shall be found invalid and unenforceable, the remaining provisions of this Agreement shall remain in full force and effect.
(f) Successors. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, representatives, and successors.
(g) Headings. The headings and subheadings contained in this Agreement are provided solely for convenience of reference and shall not be construed or interpreted in any way as affecting the meaning of any provision of this Agreement.
IN WITNESS WHEREOF, Executive and Trust have executed this Agreement effective this day of , 200 .
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Exhibit 10.30
SEVERANCE AGREEMENT
THIS SEVERANCE AGREEMENT (“Agreement”) is entered into as of September 10, 2004 by and between Equity Residential, a Maryland real estate investment trust (the “Company”), and Donna Brandin (the “Executive”).
WHEREAS, the Board of Trustees of the Company (the “Board”) recognizes that the possibility of a Change in Control (as hereinafter defined) exists or may exist in the future and that the threat or the occurrence of such an event can result in significant distractions of its key management personnel because of the uncertainties inherent in such a situation;
WHEREAS, the Board has determined that it is essential and in the best interest of the Company and its shareholders to retain the services of the Executive in the event of a threat or occurrence of a Change in Control of the Company and to ensure her continued dedication and efforts in such event without undue concern for her personal financial and employment security; and
WHEREAS, in order to induce the Executive to remain in the employ of the Company, particularly in the event of a threat or the occurrence of either a Change in Control or a termination of her employment by the Company without cause, the Company desires to enter into this Agreement with the Executive to provide the Executive with certain benefits in the event her employment is terminated as a result of such an event.
NOW, THEREFORE, in consideration of the respective agreements of the parties contained herein and other good and valuation consideration, the receipt and sufficiency of which are hereby acknowledged, it is agreed as follows:
1. Term of Agreement . This Agreement shall commence as of the date hereof and shall continue in effect until the date the Executive’s employment is terminated.
2. Definitions
2.1 Accrued Compensation . “Accrued Compensation” shall mean an amount which shall include all amounts earned or accrued through the “Termination Date” (as hereinafter defined) but not paid as of the Termination Date for: (i) base salary, (ii) reimbursement for reasonable and necessary expenses incurred by the Executive on behalf of the Company during the period ending on the Termination Date, and (iii) vacation and sick leave pay (to the extent provided by Company policy or applicable law).
2.2 Base Amount . “Base Amount” shall mean the Executive’s annual base salary at the rate in effect on the Termination Date.
2.3 Bonus Amount . “Bonus Amount” shall mean the annual average of the cash amount paid to the Executive under the Company’s annual cash bonus plan for the two years immediately preceding the year in which the Executive’s employment terminates. If the Executive’s employment is terminated prior to payment of the 2005 calendar year bonus,
“Bonus Amount” shall mean 100% of the target bonus that the Executive would have been eligible to receive for such year.
2.4 Cause . A termination of employment is for “Cause” if the Executive has been convicted of a felony involving fraud or dishonesty or the termination is evidenced by a resolution adopted in good faith by at least two-thirds of the Board that the Executive: (i) intentionally and continually failed substantially to perform her reasonably assigned duties with the Company (other than a failure resulting from the Executive’s incapacity due to physical or mental illness or from the Executive’s assignment of duties that would constitute “Good Reason” as hereinafter defined) which failure continued for a period of at least thirty (30) days after a written notice of demand for substantial performance has been delivered to the Executive specifying the manner in which the Executive has failed substantially to perform or (ii) intentionally engaged in conduct which is demonstrably and materially injurious to the Company; provided , however , that no termination of the Executive’s employment shall be for Cause as set forth in clause (ii) above until (x) there shall have been delivered to the Executive a copy of a written notice setting forth that the Executive was guilty of the conduct set forth in clause (ii) and specifying the particulars thereof in detail and (y) the Executive shall have been provided an opportunity to be heard in person by the Board (with the assistance of the Executive’s counsel if the Executive so desires). Neither an act nor a failure to act, on the Executive’s part shall be considered “intentional” unless the Executive has acted or failed to act with a lack of good faith and with a lack of reasonable belief that the Executive’s action or failure to act was in the best interest of the Company. Notwithstanding anything contained in this Agreement to the contrary, no failure to perform by the Executive after a Notice of Termination (as defined in Section 2.9) is given by the Executive shall constitute Cause for purposes of this Agreement.
2.5 Change in Control . A “Change in Control” shall mean any of the following events:
(a) An acquisition (other than directly from the Company) of any voting securities of the Company (the “Voting Securities”) by any “Person” (as the term person is used for purposes of Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”)), immediately after which such Person has “Beneficial Ownership” (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of 30% or more of the combined voting power of the Company’s then outstanding Voting Securities; provided , however , that in determining whether a Change in Control has occurred, Voting Securities which are acquired in a “Non-Control Acquisition” (as hereinafter defined) shall not constitute an acquisition which would cause a Change in Control. A “Non-Control Acquisition” shall mean an acquisition by (i) an employee benefit plan (or a trust forming a part thereof) maintained by (x) the Company or (y) any corporation or other Person of which a majority of its voting power or its equity securities or equity interest is owned directly or indirectly by the Company (a “Subsidiary”), (ii) the Company or any Subsidiary or (iii) any Person in connection with a “Non-Control Transaction” (as hereinafter defined).
(b) Approval by stockholders of the Company of:
(i) A merger, consolidation or reorganization involving the Company, unless:
(A) the stockholders of the Company, immediately before such merger, consolidation or reorganization, own, directly or indirectly, immediately following such merger, consolidation or reorganization, at
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least seventy percent (70%) of the combined voting power of the outstanding Voting Securities of the corporation or other entity resulting from such merger or consolidation or reorganization (the “Surviving Corporation”) in substantially the same proportion as their ownership of the Voting Securities immediately before such merger, consolidation or reorganization; and
(B) the individuals who were members of the Incumbent Board immediately prior to the execution of the agreement providing for such merger, consolidation or reorganization constitute at least a majority of the members of the board of directors or similar governing body of the Surviving Corporation or a corporation or other entity beneficially owning, directly or indirectly, a majority of the Voting Securities of the Surviving Corporation;
(ii) A complete liquidation or dissolution of the Company; or
(iii) An agreement for the sale or other disposition of all or substantially all of the assets of the Company to any Person (other than to an entity of which the Company directly or indirectly owns at least 70% of the voting shares).
Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because any Person (the “Subject Person”) acquired Beneficial Ownership of more than the permitted amount of the outstanding Voting Securities as a result of the acquisition of Voting Securities by the Company which, by reducing the number of Voting Securities outstanding, increases the proportional number of shares Beneficially Owned by the Subject Person, provided that if a Change in Control would occur (but for the operation of this sentence) as a result of the acquisition of Voting Securities by the Company, and after such share acquisition by the Company, the Subject Person becomes the Beneficial Owner of any additional Voting Securities which increases the percentage of the then outstanding Voting Securities Beneficially Owned by the Subject Person, then a Change in Control shall occur.
(c) The rejection by the voting Beneficial Owners of the outstanding Shares of the entire slate of trustees that the Board proposes at a single election of trustees; or
(d) The rejection by the voting Beneficial Owners of the outstanding Shares of one-half or more of the trustees that the Board proposes over any two or more consecutive elections of trustees.
(e) Notwithstanding anything contained in this Agreement to the contrary, if the Executive’s employment is terminated prior to a Change in Control and the Executive reasonably demonstrates that such termination: (i) was at the request of a third party who has indicated an intention or taken steps reasonably calculated to effect a Change in Control and who effectuates a Change in Control (a “Third Party”) or (ii) otherwise occurred in connection with, or in anticipation of, a Change in Control which actually occurs, then for all purposes of this Agreement, the date of a Change in Control with respect to the Executive shall mean the date immediately prior to the date of such termination of the Executive’s employment.
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2.6 Company . The “Company” shall include the Company’s “Successors and Assigns” (as hereinafter defined).
2.7 Disability . “Disability” shall mean a physical or mental infirmity that entitles the Executive to benefits under the Company sponsored long-term disability plan in which he or she participates.
2.8 Good Reason .
(a) “Good Reason” shall mean the occurrence of any of the events or conditions described in subsections (i) through (vii) hereof:
(i) a change in the Executive’s status, position or responsibilities (including reporting responsibilities) which, in the Executive’s reasonable judgment, represents a substantial adverse change from her status, position or responsibilities; or the assignment to the Executive of any duties or responsibilities which, in the Executive’s reasonable judgment, are inconsistent with her status, title, position or responsibilities.
(ii) a reduction in the Executive’s base salary or any failure to pay the Executive any compensation or benefits to which she is entitled within five days of written notice thereof;
(iii) the Company’s requiring the Executive to be based at any place outside a 30-mile radius from the Executive’s principal location of business in Chicago, Illinois, except for reasonably required travel on the Company’s business;
(iv) the insolvency or the filing (by any party, including the Company) of a petition for bankruptcy of the Company, which petition is not dismissed within sixty (60) days;
(v) any material breach by the Company of any provision of this Agreement;
(vi) any purported termination of the Executive’s employment for Cause by the Company which does not comply with the terms of Section 2.4; or
(vii) the failure of the Company to obtain an agreement, satisfactory to the Executive, from any Successors and Assigns to assume and agree to perform this Agreement, as contemplated in Section 6 hereof.
(b) Any event or condition described in Section 2.8(a)(i) through (vii) which occurs prior to a Change in Control, but which the Executive reasonably demonstrates arose in connection with, or in anticipation of, a Change in Control, which actually occurs, shall constitute Good Reason for purposes of this Agreement notwithstanding that it occurred prior to the Change in Control.
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2.9. Notice of Termination . “Notice of Termination” shall mean a written notice of termination from the Company of the Executive’s employment which indicates a specific termination provision in this Agreement relied upon and which sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated.
2.10. Pro Rata Bonus . “Pro Rata Bonus” shall mean an amount equal to 100% of the target bonus that the Executive would have been eligible to receive for the Company’s fiscal year in which the Executive’s employment terminates, multiplied by a fraction, the numerator of which is the number of days in such fiscal year through the Termination Date and the denominator of which is 365.
2.11. Successors and Assigns . “Successors and Assigns” shall mean a corporation or other entity acquiring all or substantially all the Voting Securities, assets or business of the Company whether by operation of law or otherwise, and any affiliate of such Successors and Assigns.
2.12. Termination Date . “Termination Date” shall mean the first to occur of: (a) in the case of the Executive’s death, her date of death, (b) in the case of Good Reason, the last day of her employment and (c) in all other cases, the date specified in the Notice of Termination or if no Notice of Termination is sent, the last day of her employment; provided , however , that if the Executive’s employment is terminated by the Company due to Disability, the date specified in the Notice of Termination shall be the 30 th day after receipt of the Notice of Termination by the Executive, provided that the Executive shall not have returned to the full-time performance of her duties within 30 days after such receipt.
3. Termination of Employment . The Executive shall be entitled to the following compensation and benefits if her employment with the Company is terminated:
(a) If the Executive’s employment with the Company shall be terminated: (i) by the Company for Cause or Disability, (ii) by reason of the Executive’s death or (iii) by the Executive other than for Good Reason, the Company shall pay to the Executive the Accrued Compensation; provided , however , if an employment agreement is in existence between the Company and/or any of its affiliates and the Executive on the Termination Date, the Company and/or its affiliates, as the case may be, shall also pay to the Executive any amounts owed to the Executive pursuant to such employment agreement.
(b) If the Executive’s employment with the Company shall be terminated by the Company other than for Cause, death or Disability or by the Executive for Good Reason, the Executive shall be entitled to the following:
(i) the Company shall pay the Executive all Accrued Compensation, a Pro-Rata Bonus and 100% of any unpaid bonus with respect to the Company’s fiscal year ended prior to the Termination Date.
(ii) the Company shall pay the Executive as severance pay and in lieu of any further compensation for periods subsequent to the Termination Date, in a single payment an amount in cash equal to one (1) times the sum of (A) the Base Amount and (B) the Bonus Amount; provided , however , if an employment agreement is in existence between the Company and/or any of its affiliates and
5
the Executive on the Termination Date, any amount due the Executive under this Section 3(b)(ii) shall be reduced by the amount of Base Amount and Bonus Amount paid as severance pay to Executive pursuant to such employment agreement in lieu of compensation for periods subsequent to the Termination Date.
(iii) for twelve (12) months following the Termination Date, (the “Continuation Period”), the Company shall at its expense continue on behalf of the Executive and her dependents and beneficiaries the same medical, dental, life, disability and hospitalization benefits provided to the Executive immediately prior to the termination of employment. The coverage and benefits (including deductibles and costs) provided in this Section 3(b)(iii) during the Continuation Period shall be no less favorable to the Executive and her or her dependents and beneficiaries than the most favorable of such coverages and benefits during any of the periods referred to in clauses (A) and (B) above. The Company’s obligation hereunder with respect to the foregoing benefits shall be limited to the extent that the Executive obtains any such benefits pursuant to a subsequent employer’s benefit plans, in which case the Company may reduce the coverage of any benefits it is required to provide the Executive hereunder as long as the aggregate coverages and benefits of the combined benefits plans is no less favorable to the Executive than the coverages and benefits required to be provided hereunder. This subsection (iii) shall not be interpreted so as to limit any benefits to which the Executive, her dependents or beneficiaries may be otherwise entitled under any of the Company’s employee benefit plans, programs or practices following the Executive’s termination of employment, including without limitation, retiree medical and life insurance benefits;
(iv) all theretofore unvested stock options, restricted options, restricted stock, performance shares, phantom share awards, share appreciation rights, dividend equivalents and any other awards issued to the Executive pursuant to the Company’s Share Incentive Plan, as amended or replaced time to time, shall immediately vest at the maximum possible amount; with the exception of performance shares and other awards which have a variable payout, in which case such performance shares/awards shall immediately vest at the greater of: (i) the 100% target level; or (ii) the number of shares earned calculated using the valuation method as of the date of termination of employment; and
(c) The amounts provided for in Sections 3(b)(i) and (ii) shall be paid in a single lump sum cash payment in immediately available funds within five (5) days following the expiration of any required waiting period under the release agreement referenced in Section 11 hereof (or earlier, if required by applicable law).
(d) The Executive shall not be required to mitigate the amount of any payment provided for in this Agreement by seeking other employment or otherwise, and no such payment shall be offset or reduced by the amount of any compensation or benefits provided to the Executive in any subsequent employment except as provided in Section 3(b)(iii).
(e) The Executive’s entitlement to any other compensation or benefits or any indemnification shall be determined in accordance with the Company’s employee benefit plans
6
and other applicable programs, policies and practices or any indemnification agreement in effect.
4. Notice of Termination . Any purported termination of the Executive’s employment by the Company shall be communicated by Notice of Termination to the Executive. For purposes of this Agreement, no such purported termination shall be effective without such Notice of Termination.
5. Successors; Binding Agreement . This Agreement shall be binding upon and shall inure to the benefit of the Company, its Successors and Assigns, and the Company shall require any Successors and Assigns to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession or assignment had taken place. Neither this Agreement nor any right or interest hereunder shall be assignable or transferable by the Executive, her beneficiaries or legal representatives, except by will or by the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal personal representative.
6. Fees and Expenses . The Company shall pay all legal fees and related expenses (including the costs of experts, evidence and counsel) incurred by the Executive as a result of the Executive obtaining or enforcing any right or benefit provided by this Agreement. Furthermore, any amounts due Executive by the Company that are not paid when due under this Agreement shall bear interest at the Prime Rate (as declared by Bank of America, N.A. from time to time) plus 5% from the time when the payment is due until the date the payment is made.
7. Notice . For the purposes of this Agreement, notices and all other communications provided for in the Agreement (including the Notice of Termination) shall be in writing and shall be deemed to have been duly given when personally delivered or sent by certified mail, return receipt requested, postage prepaid, by overnight courier or by facsimile, addressed to the respective addresses and facsimile numbers last given by each party to the other, provided that all notices to the Company shall be directed to the attention of the Chairman of the Board with a copy to the Secretary of the Company. All notices and communications shall be deemed to have been received on the date of delivery thereof or on the third business day after the mailing thereof, except that notice of change of address shall be effective only upon receipt.
8. Non-Exclusivity of Rights . Nothing in this Agreement shall prevent or limit the Executive’s continuing or future participation in any benefit, bonus, incentive or other plan or program provided by the Company (except for any severance or termination policies, plans, programs or practices) and for which the Executive may qualify, nor shall anything herein limit or reduce such rights as the Executive may have under any other agreements with the Company (except for any severance or termination agreement). Amounts which are vested benefits or which the Executive is otherwise entitled to receive under any plan or program of the Company shall be payable in accordance with such plan or program, except as explicitly modified by this Agreement.
9. No Guaranteed Employment . The Executive and the Company acknowledge that, except as may otherwise be provided under any other written agreement between the Executive and the Company, the employment of the Executive by the Company is “at will” and
7
may be terminated by either the Executive or the Company at any time, subject, however to the rights of the Executive provided herein in the event of any such termination.
10. Settlement of Claims . The Company’s obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any circumstances, including, without limitation, any set-off, counterclaim, recoupment, defense or other right which the Company may have against the Executive or others.
11. Full Satisfaction; Waiver and Release; Non-Competition . As a condition to receiving the payments and benefits hereunder, the Executive shall execute a document in customary form, releasing and waiving any and all claims, causes of actions and the like against the Company and its successors, shareholders, officers, trustees, agents and employees, regarding all matters relating to the Executive’s service as an employee of the Company or any affiliates and the termination of such relationship. Said document shall also contain appropriate confidentiality provisions and a one-year non-competition and employee non-solicitation covenant by the Executive. Such claims include, without limitation , any claims arising under Age Discrimination in Employment Act of 1967, as amended (the “ADEA”); Title VII of the Civil Rights Act of 1964, as amended; the Civil Rights Act of 1991, as amended; the Equal Pay Act of 1962; the American Disabilities Act of 1990; the Family Medical Leave Act, as amended; the Employee Retirement Income Security Act of 1976, as amended; or any other federal, state or local statute or ordinance, but exclude any claims that arise out of an asserted breach of the terms of this Agreement or current or future claims related to the matters described in Section 8.
12. Miscellaneous . No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by the Executive and the Company. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provisions of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. No agreement or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not expressly set forth in this Agreement.
13. Governing Law . This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Illinois without giving effect to the conflict of laws principles thereof. Any action brought by any party to this Agreement shall be brought and maintained in a court of competent jurisdiction in Cook County in the State of Illinois.
14. Severability . The provisions of this Agreement shall be deemed severable and the invalidity or unenforceability of any provision shall not affect the validity or enforceability of the other provisions hereof.
15. Entire Agreement . This Agreement constitutes the entire agreement between the parties hereto and supersedes all prior agreements, if any, understandings and arrangements, oral or written, between the parties hereto with respect to the subject matter hereof.
8
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its duly authorized officer and the Executive has executed this Agreement as of the day and year first above written.
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EQUITY RESIDENTIAL |
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By: |
/s/ Bruce W. Duncan |
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Bruce W. Duncan |
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President and CEO |
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By: |
/s/ Donna Brandin |
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Donna Brandin, Executive |
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9
Exhibit 12
EQUITY RESIDENTIAL
Computation of Ratio of Earnings to Combined Fixed Charges
|
|
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Year Ended December 31, |
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|||||||||||||
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|
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2006 |
|
2005 |
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2004 |
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2003 |
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2002 |
|
|||||
|
Income from continuing operations, net of minority interests |
|
$ |
100,532 |
|
$ |
147,323 |
|
$ |
88,778 |
|
$ |
98,966 |
|
$ |
104,689 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
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Interest expense incurred, net |
|
427,952 |
|
362,347 |
|
307,697 |
|
292,996 |
|
288,319 |
|
|||||
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Amortization of deferred financing costs |
|
8,302 |
|
6,503 |
|
5,814 |
|
5,269 |
|
5,281 |
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|||||
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Allocation to Minority Interests: |
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|
|
|
|
|
|
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|
|
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|||||
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Operating Partnership, net |
|
4,201 |
|
6,796 |
|
2,624 |
|
202 |
|
2,335 |
|
|||||
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Preference Interests and Junior Preference Units |
|
2,002 |
|
7,606 |
|
19,490 |
|
20,536 |
|
20,536 |
|
|||||
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Premium on redemption of Preference Interests |
|
684 |
|
4,134 |
|
1,117 |
|
— |
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— |
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|||||
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|
|
|
|
|
|
|
|
|
|
|
|
|||||
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Earnings before combined fixed charges and preferred distributions |
|
543,673 |
|
534,709 |
|
425,520 |
|
417,969 |
|
421,160 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Preferred Share distributions |
|
(37,113 |
) |
(49,642 |
) |
(53,746 |
) |
(76,435 |
) |
(76,615 |
) |
|||||
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Premium on redemption of Preferred Shares |
|
(3,965 |
) |
(4,359 |
) |
— |
|
(20,237 |
) |
— |
|
|||||
|
Preference Interest and Junior Preference Unit distributions |
|
(2,002 |
) |
(7,606 |
) |
(19,490 |
) |
(20,536 |
) |
(20,536 |
) |
|||||
|
Premium on redemption of Preference Interests |
|
(684 |
) |
(4,134 |
) |
(1,117 |
) |
— |
|
— |
|
|||||
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|
|
|
|
|
|
|
|
|
|
|
|
|||||
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Earnings before combined fixed charges |
|
$ |
499,909 |
|
$ |
468,968 |
|
$ |
351,167 |
|
$ |
300,761 |
|
$ |
324,009 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
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Interest expense incurred, net |
|
$ |
427,952 |
|
$ |
362,347 |
|
$ |
307,697 |
|
$ |
292,996 |
|
$ |
288,319 |
|
|
Amortization of deferred financing costs |
|
8,302 |
|
6,503 |
|
5,814 |
|
5,269 |
|
5,281 |
|
|||||
|
Interest capitalized for real estate and unconsolidated entities under development |
|
20,734 |
|
13,701 |
|
13,969 |
|
20,647 |
|
27,167 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
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Total combined fixed charges |
|
456,988 |
|
382,551 |
|
327,480 |
|
318,912 |
|
320,767 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Preferred Share distributions |
|
37,113 |
|
49,642 |
|
53,746 |
|
76,435 |
|
76,615 |
|
|||||
|
Premium on redemption of Preferred Shares |
|
3,965 |
|
4,359 |
|
— |
|
20,237 |
|
— |
|
|||||
|
Preference Interest and Junior Preference Unit distributions |
|
2,002 |
|
7,606 |
|
19,490 |
|
20,536 |
|
20,536 |
|
|||||
|
Premium on redemption of Preference Interests |
|
684 |
|
4,134 |
|
1,117 |
|
— |
|
— |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
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Total combined fixed charges and preferred distributions |
|
$ |
500,752 |
|
$ |
448,292 |
|
$ |
401,833 |
|
$ |
436,120 |
|
$ |
417,918 |
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|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
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Ratio of earnings before combined fixed charges to total combined fixed charges (1) |
|
1.09 |
|
1.23 |
|
1.07 |
|
— |
|
1.01 |
|
|||||
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|
|
|
|
|
|
|
|
|
|
|
|
|||||
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Ratio of earnings before combined fixed charges and preferred distributions to total combined fixed charges and preferred distributions (1) |
|
1.09 |
|
1.19 |
|
1.06 |
|
— |
|
1.01 |
|
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(1) For 2003, the coverage deficiencies on both ratios approximated $18.2 million. All ratios have been reduced due to the disposition of properties which resulted in the inclusion of those properties in discontinued operations for all periods presented. For 2003, the ratios have been further reduced due to the one-time $20.2 million premium on the redemption of the Series G Preferred Shares.
Exhibit 21
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LIST OF SUBSIDIARIES OF EQUITY RESIDENTIAL |
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Entity |
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1 |
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1145 Acquisition , LLC |
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2 |
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1401 State, LLC |
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3 |
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303 THIRD STREET DEVELOPERS, LLC |
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4 |
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303 THIRD STREET VENTURE I, LLC |
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5 |
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303 THIRD STREET VENTURE II, LLC |
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6 |
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402 WEST 38TH STREET CORP |
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7 |
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722 W KENNEDY LLC |
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8 |
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ALTA PACIFIC, LLC |
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9 |
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AMBERTON APARTMENTS, LLC |
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10 |
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ANE ASSOCIATES, LLC |
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11 |
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ARGUS LAND COMPANY, INC. |
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12 |
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ARTERY NORTHAMPTON LIMITED PARTNERSHIP |
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13 |
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AVON PLACE ASSOCIATES, LLC |
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14 |
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BALATON CONDOMINIUM ASSOCIATION |
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15 |
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BALATON CONDOMINIUM, LLC |
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16 |
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BARCELONA CONDOMINIUM, LLC |
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17 |
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BEL APARTMENT PROPERTIES TRUST |
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18 |
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BEL COMMUNITIES PROPERTY TRUST |
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19 |
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BEL MULTIFAMILY PROPERTY TRUST |
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20 |
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BEL MULTIFAMILY, LLC |
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21 |
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BEL RESIDENTIAL PROPERTIES TRUST |
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22 |
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BEL-APT, L.L.C. |
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23 |
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BEL-COMMUNITIES, LLC |
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24 |
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BEL-EQR I LIMITED PARNTERSHIP |
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25 |
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BEL-EQR I, L.L.C. |
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26 |
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BEL-EQR II LIMITED PARNTERSHIP |
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27 |
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BEL-EQR II, L.L.C. |
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28 |
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BEL-EQR III, LIMITED PARTNERSHIP |
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29 |
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BEL-EQR III, LLC |
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30 |
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BEL-EQR IV, LIMITED PARTNERSHIP |
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31 |
|
BEL-EQR IV, LLC |
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32 |
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BEL-EQR NORTHLAKE GP, LLC |
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33 |
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BEL-RES, L.L.C. |
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34 |
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BRIDGE POINT APTS, LTD |
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35 |
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BROOKSIDE PLACE ASSOCIATES, L.P. |
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36 |
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BROOKSIDE PLACE G.P. CORP. |
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37 |
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BUENA VISTA PLACE ASSOCIATES |
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38 |
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CANTERBURY APARTMENTS, LLC |
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39 |
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CANYON CREEK VILLAGE ASSOCIATES, L.P. |
|
40 |
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CANYON CREEK VILLAGE G.P. CORP. |
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41 |
|
CAPREIT Arbor Glen L.P. |
|
42 |
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CAPREIT Woodcrest Villa L.P. |
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43 |
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CARDINAL ASSOCIATES CENTRAL MANAGEMENT |
|
44 |
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CARDINAL DIVERSIFIED PROPERTIES |
|
45 |
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CARDINAL GP XVI CORP |
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46 |
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CENTERPOINT APARTMENT ASSOC, LTD |
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47 |
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CHINATOWN GATEWAY, LLC |
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48 |
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COBBLESTONE VILLAGE COMMUNITY RENTALS, L.P. |
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49 |
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COBBLESTONE VILLAGE G.P. CORP. |
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50 |
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CORPORATE QUARTERS, INC. |
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51 |
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CORPORATE STAY INTERNATIONAL, INC. |
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52 |
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COUNTRY CLUB ASSOCIATES LIMITED PARTNERSHIP |
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53 |
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COUNTRY CLUB CONDOMINIUM, LLC |
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54 |
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COUNTRY OAKS ASSOCIATES, L.P. |
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55 |
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COUNTRY OAKS G.P. CORP. |
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56 |
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COUNTRY RIDGE GENERAL PARTNERSHIP |
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57 |
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CRICO of Ethan’s I, L.P. |
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Entity |
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58 |
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CRICO of Ethan’s II, L.P. |
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59 |
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CRICO of Fountain Place, L.P. |
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60 |
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CRICO of James Street Crossing, L.P. |
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61 |
|
CRICO of Ocean Walk, L.P. |
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62 |
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CRP SERVICE COMPANY, LLC |
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63 |
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CRSI SPV 103, INC. |
|
64 |
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CRSI SPV 1996 PW2, INC. |
|
65 |
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CRSI SPV 1996 PW3, INC. |
|
66 |
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CRSI SPV 30231, LLC |
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67 |
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CRSI SPV 52, LLC |
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68 |
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CRSI SPV 95, INC. |
|
69 |
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DEERFIELD ASSOCIATES, L.P. |
|
70 |
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DEERFIELD G.P. CORP. |
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71 |
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DEL REY II, LLC |
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72 |
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DUXFORD, LLC |
|
73 |
|
EC-ALAMENDA RANCH, LLC |
|
74 |
|
EC-AZURE CREEK, LLC |
|
75 |
|
EC-BELLA VISTA, LLC |
|
76 |
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EC-BELLE ARTS, LLC |
|
77 |
|
EC-BORDEAUX, LLC |
|
78 |
|
EC-BRAEWOOD, LLC |
|
79 |
|
EC-ELLIOTT, LLC |
|
80 |
|
EC-EMPRESS ON FIFTH, LLC |
|
81 |
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EC-FAIRWAY GREENS, LLC |
|
82 |
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EC-FIFTH AVENUE NORTH, LLC |
|
83 |
|
EC-GRAND MARQUIS, LLC (FKA EC-GRAND CANAL, LLC) |
|
84 |
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ECH-GFR, INC. (FKA GLOBE FURNITURE RENTALS, INC.) |
|
85 |
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EC-MAGNUSON POINTE, LLC |
|
86 |
|
EC-MILANO TERRACE, LLC |
|
87 |
|
EC-PACIFIC COVE, LLC |
|
88 |
|
EC-PARK BLOOMINGDALE, LLC |
|
89 |
|
EC-REGENCY PARK, LLC |
|
90 |
|
EC-RIVIERA PALMS, LLC |
|
91 |
|
EC-SOUTH PALM PLACE, LLC |
|
92 |
|
EC-STERLING HEIGHTS, LLC |
|
93 |
|
EC-TIMBER RIDGE, LLC |
|
94 |
|
EC-TUSCANY VILLAS, LLC |
|
95 |
|
EC-VENETIAN II LLC |
|
96 |
|
EC-WEST FALLS, LLC |
|
97 |
|
EDGEWATER COMMUNITY RENTALS, L.P. |
|
98 |
|
EDGEWATER G.P. CORP. |
|
99 |
|
E-LODGE ASSOCIATES LIMITED PARTNERSHIP |
|
100 |
|
EQR (1999) HAMPDEN TOWN CENTER, LLC |
|
101 |
|
EQR (1999) HOMESTEAD, LLC (FKA EQR/LEGACY PARTNERS 1999 HOMESTEAD, LLC) |
|
102 |
|
EQR (1999) MASTER LLC (FKA EQR/LEGACY PARTNERS 1999 MASTER, LLC) |
|
103 |
|
EQR (1999) TOWERS LLC (FKA EQR/LEGACY PARTNERS 1999 TOWER, LLC) |
|
104 |
|
EQR (1999) WARNER RIDGE LLC (FKA EQR/LEGACY PARTNERS 1999 WARNER RIDGE, LLC) |
|
105 |
|
EQR (1999) WARNER RIDGE PHASE III LLC (FKA EQR/LEGACY PARTNERS 1999 WR III, LLC) |
|
106 |
|
EQR NO. FOUR MASTER LP (FKA: EQR/LINCOLN NO. FOUR MASTER LP) |
|
107 |
|
EQR NO. ONE MASTER LP (FKA: EQR/LINCOLN NO. ONE MASTER LP) |
|
108 |
|
EQR NO. THREE MASTER LP (FKA: EQR/LINCOLN NO. THREE MASTER LP) |
|
109 |
|
EQR NO. TWO MASTER LP (FKA: EQR/LINCOLN NO. TWO MASTER LP) |
|
110 |
|
EQR ON FOURTH, LLC |
|
111 |
|
EQR/CRICO GP, LLC |
|
112 |
|
EQR/KB CALIFORNIA RCI, LLC |
|
113 |
|
EQR/KB CALIFORNIA RCI, LLC |
|
114 |
|
EQR/LINCOLN FORT LEWIS COMMUNITIES, LLC |
|
115 |
|
EQR/LINCOLN FT. LEWIS COMMUNITIES, LLC |
|
116 |
|
EQR/Lincoln RCI Southeast LLC |
|
117 |
|
EQR/LINCOLN REHAB MASTER, LP |
|
118 |
|
EQR-140 RIVERSIDE A, LLC |
|
|
|
Entity |
|
|
|
|
|
119 |
|
EQR-140 RIVERSIDE B, LLC |
|
120 |
|
EQR-140 RIVERSIDE C, LLC |
|
121 |
|
EQR-140 RIVERSIDE D, LLC |
|
122 |
|
EQR-140 RIVERSIDE E, LLC |
|
123 |
|
EQR-140 RIVERSIDE F, LLC |
|
124 |
|
EQR-140 RIVERSIDE, LLC |
|
125 |
|
EQR-160 RIVERSIDE A, LLC |
|
126 |
|
EQR-160 RIVERSIDE B, LLC |
|
127 |
|
EQR-160 RIVERSIDE C, LLC |
|
128 |
|
EQR-160 RIVERSIDE D, LLC |
|
129 |
|
EQR-160 RIVERSIDE E, LLC |
|
130 |
|
EQR-160 RIVERSIDE F, LLC |
|
131 |
|
EQR-160 RIVERSIDE G, LLC |
|
132 |
|
EQR-160 RIVERSIDE H, LLC |
|
133 |
|
EQR-160 RIVERSIDE I, LLC |
|
134 |
|
EQR-180 RIVERSIDE A, LLC |
|
135 |
|
EQR-180 RIVERSIDE B, LLC |
|
136 |
|
EQR-180 RIVERSIDE C, LLC |
|
137 |
|
EQR-180 RIVERSIDE D, LLC |
|
138 |
|
EQR-180 RIVERSIDE E, LLC |
|
139 |
|
EQR-180 RIVERSIDE F, LLC |
|
140 |
|
EQR-180 RIVERSIDE G, LLC |
|
141 |
|
EQR-180 RIVERSIDE H, LLC |
|
142 |
|
EQR-600 WASHINGTON, LLC |
|
143 |
|
EQR-71 BROADWAY A, LLC |
|
144 |
|
EQR-71 BROADWAY B, LLC |
|
145 |
|
EQR-71 BROADWAY C, LLC |
|
146 |
|
EQR-71 BROADWAY D, LLC |
|
147 |
|
EQR-71 BROADWAY E, LLC |
|
148 |
|
EQR-71 BROADWAY F, LLC |
|
149 |
|
EQR-740 RIVER DRIVE, LLC |
|
150 |
|
EQR-ACADEMY VILLAGE SPE, LLC |
|
151 |
|
EQR-ACADEMY VILLAGE, LLC |
|
152 |
|
EQR-ALAFAYA EXCHANGE, LLC |
|
153 |
|
EQR-ALEXAN TERRACE, LLC |
|
154 |
|
EQR-ALEXANDRIA (FKA: EQR-LINCOLN ALEXANDRIA, LLC) |
|
155 |
|
EQR-ALEXANDRIA ORLANDO, LLC |
|
156 |
|
EQR-ALTA CREST, LLC |
|
157 |
|
EQR-ARBORS FINANCING, LP |
|
158 |
|
EQR-ARDEN VILLAS, L.L.C. |
|
159 |
|
EQR-ARIZONA, L.L.C. |
|
160 |
|
EQR-ARTCAPLOAN, L.L.C. |
|
161 |
|
EQR-AUTUMN RIVER, LLC |
|
162 |
|
EQR-BARRINGTON, LLC |
|
163 |
|
EQR-BAY HILL, LLC |
|
164 |
|
EQR-BELLAGIO, LLC |
|
165 |
|
EQR-BELLEVUE MEADOW GP LP |
|
166 |
|
EQR-BELLEVUE MEADOW LP |
|
167 |
|
EQR-BENEVA PLACE, INC. |
|
168 |
|
EQR-BENEVA PLACE, LLC |
|
169 |
|
EQR-BOND PARTNERSHIP |
|
170 |
|
EQR-BOYNTON I, LLC |
|
171 |
|
EQR-BOYNTON II, LLC |
|
172 |
|
EQR-BRADLEY PARK, LLC |
|
173 |
|
EQR-BRAINTREE, LLC |
|
174 |
|
EQR-BRAMBLEWOOD GP LP |
|
175 |
|
EQR-BRAMBLEWOOD LP |
|
176 |
|
EQR-BRETON HAMMOCKS FINANCING LIMITED PARTNERSHIP |
|
177 |
|
EQR-BRIARWOOD GP LP |
|
178 |
|
EQR-BRIARWOOD LP |
|
179 |
|
EQR-BROADWAY LP |
|
|
|
Entity |
|
|
|
|
|
180 |
|
EQR-BROOKDALE VILLAGE, LLC |
|
181 |
|
EQR-BS FINANCING LIMITED PARTNERSHIP |
|
182 |
|
EQR-CALIFORNIA EXCHANGE, LLC (FKA EQR-REGATTA, LLC) |
|
183 |
|
EQR-CEDAR RIDGE GP, LLC |
|
184 |
|
EQR-CEDAR RIDGE LP |
|
185 |
|
EQR-CENTENNIAL COURT, LLC |
|
186 |
|
EQR-CENTENNIAL TOWER, LLC |
|
187 |
|
EQR-CHARDONNAY PARK, L.L.C. |
|
188 |
|
EQR-CHASE KNOLLS LENDER, LLC |
|
189 |
|
EQR-CHERRY CREEK TENNESSEE, LLC |
|
190 |
|
EQR-CHERRY HILL, LLC |
|
191 |
|
EQR-CHICKASAW CROSSING, INC. |
|
192 |
|
EQR-CHICKASAW CROSSING, LLC |
|
193 |
|
EQR-CHINATOWN GATEWAY, LLC |
|
194 |
|
EQR-CHURCH CORNER, LLC |
|
195 |
|
EQR-COACHMAN TRAILS, LLC |
|
196 |
|
EQR-CODELLE LIMITED PARTNERSHIP |
|
197 |
|
EQR-CODELLE, LLC |
|
198 |
|
EQR-CONNOR LIMITED PARTNERSHIP |
|
199 |
|
EQR-CONNOR, LLC |
|
200 |
|
EQR-COUNTRY CLUB LAKES, LLC |
|
201 |
|
EQR-CREEKSIDE OAKS GENERAL PARTNERSHIP |
|
202 |
|
EQR-CROWNTREE, LLC |
|
203 |
|
EQR-CYPRESS LAKE, LLC |
|
204 |
|
EQR-DEER CREEK, LLC |
|
205 |
|
EQR-EASTBRIDGE, LLC |
|
206 |
|
EQR-EASTBRIDGE, LP |
|
207 |
|
EQR-EMERALD PLACE FINANCING LIMITED PARTNERSHIP |
|
208 |
|
EQR-ESSEX PLACE FINANCING LIMITED PARTNERSHIP |
|
209 |
|
EQR-FAIRFAX CORNER II, LLC (FKA: ERP/Vistas-Fairfax Corner, LLC) |
|
210 |
|
EQR-FAIRFAX CORNER, LLC |
|
211 |
|
EQR-FAIRFIELD, LLC |
|
212 |
|
EQR-FANCAP 2000A LIMITED PARTNERSHIP |
|
213 |
|
EQR-FANCAP 2000A, LLC (d/b/a EQR-TENNESSEE LOAN PORTFOLIO, LLC) |
|
214 |
|
EQR-FANKEY 2004 LIMITED PARTNERSHIP |
|
215 |
|
EQR-FANKEY 2004, LLC |
|
216 |
|
EQR-FERNBROOK, LLC |
|
217 |
|
EQR-FIELDERS CROSSING GP, LLC |
|
218 |
|
EQR-FIELDERS CROSSING LP |
|
219 |
|
EQR-FLATLANDS, LLC |
|
220 |
|
EQR-GALLERY, LLC |
|
221 |
|
EQR-GALLERY, LP |
|
222 |
|
EQR-GEORGIAN WOODS, LLC |
|
223 |
|
EQR-GRANDVIEW II GP, LP |
|
224 |
|
EQR-GRANDVIEW II LP |
|
225 |
|
EQR-GREENHAVEN GP LP |
|
226 |
|
EQR-GREENHAVEN LP |
|
227 |
|
EQR-HAMPSHIRE PLACE, LLC |
|
228 |
|
EQR-HARBOR STEPS MEMBER, LLC |
|
229 |
|
EQR-HARBOR STEPS, LLC |
|
230 |
|
EQR-HERITAGE RIDGE, LLC |
|
231 |
|
EQR-HERITAGE RIDGE, LP |
|
232 |
|
EQR-HERNDON, LLC |
|
233 |
|
EQR-HIGHLANDS RANCH, LLC |
|
234 |
|
EQR-HILL CHAVEZ, LLC (FKA EQR-MARKS EAST, LLC) |
|
235 |
|
EQR-HOLDING, LLC |
|
236 |
|
EQR-HOLDING, LLC2 |
|
237 |
|
EQR-HUDSON CROSSING A, LLC |
|
238 |
|
EQR-HUDSON CROSSING B, LLC |
|
239 |
|
EQR-HUDSON CROSSING C, LLC |
|
240 |
|
EQR-HUDSON CROSSING D, LLC |
|
|
|
Entity |
|
|
|
|
|
241 |
|
EQR-HUDSON CROSSING E, LLC |
|
242 |
|
EQR-HUDSON POINTE, LLC (FKA: EQR-LINCOLN HUDSON POINTE, LLC) |
|
243 |
|
EQR-IVORY WOOD, LLC |
|
244 |
|
EQR-KINGS COLONY, LLC |
|
245 |
|
EQR-LAKE UNDERHILL, LLC |
|
246 |
|
EQR-LAKESHORE AT PRESTON LP |
|
247 |
|
EQR-LAKEWOOD GREENS GP, LLC |
|
248 |
|
EQR-LAKEWOOD GREENS LP |
|
249 |
|
EQR-LAWRENCE, LLC |
|
250 |
|
EQR-LEXINGTON FARM, LLC |
|
251 |
|
EQR-LEXINGTON FARM, LLC |
|
252 |
|
EQR-LINCOLN BRAINTREE, LLC |
|
253 |
|
EQR-LINCOLN GREEN, LLC |
|
254 |
|
EQR-LINCOLN VILLAGE (CA) I GP LP |
|
255 |
|
EQR-LINCOLN VILLAGE (CA) I LP |
|
256 |
|
EQR-LINCOLN VILLAGE (CA) II GP LP |
|
257 |
|
EQR-LINCOLN VILLAGE (CA) II LP |
|
258 |
|
EQR-LINDBERGH PLACE, LLC |
|
259 |
|
EQR-LODGE (OK) GP LIMITED PARTNERSHIP |
|
260 |
|
EQR-LOMBARD, LLC (FKA LINCOLN LOMBARD, LLC) |
|
261 |
|
EQR-LOUDOUN, LLC (FKA: EQR-LINCOLN LOUDOUN, LLC) |
|
262 |
|
EQR-LPC URBAN RENEWAL NORTH PIER, LLC |
|
263 |
|
EQR-MARINA BAY APARTMENTS, LLC |
|
264 |
|
EQR-MARINA BAY, LLC (FKA: EQR-LINCOLN MARINA BAY, LLC) |
|
265 |
|
EQR-MARKS A, L.L.C. |
|
266 |
|
EQR-MARKS B, L.L.C. |
|
267 |
|
EQR-MARKS WEST, LLC |
|
268 |
|
EQR-MARTINS LANDING, LLC |
|
269 |
|
EQR-MET CA FINANCING LIMITED PARTNERSHIP |
|
270 |
|
EQR-MET FINANCING, LP |
|
271 |
|
EQR-MILL CREEK, LLC |
|
272 |
|
EQR-MIRAMAR LAKES, LLC |
|
273 |
|
EQR-MISSION HILLS, LLC |
|
274 |
|
EQR-MISSIONS AT SUNBOW, LLC |
|
275 |
|
EQR-MISSOURI, L.L.C. |
|
276 |
|
EQR-MLP 1, LLC |
|
277 |
|
EQR-MLP 2, LLC |
|
278 |
|
EQR-MLP 3, LLC |
|
279 |
|
EQR-MLP 4, LLC |
|
280 |
|
EQR-MONTE VIEJO, LLC |
|
281 |
|
EQR-MONTERRA, LLC |
|
282 |
|
EQR-MOSAIC, LLC |
|
283 |
|
EQR-MOUNTAIN SHADOWS GP LP |
|
284 |
|
EQR-MOUNTAIN SHADOWS LP |
|
285 |
|
EQR-NEW LLC |
|
286 |
|
EQR-NEW LLC2 |
|
287 |
|
EQR-NEW LLC3 |
|
288 |
|
EQR-NORTH CREEK, LLC |
|
289 |
|
EQR-NORTH HILL, L.L.C. |
|
290 |
|
EQR-NORTH PIER, LLC (FKA: EQR-LINCOLN NORTH PIER, LLC) |
|
291 |
|
EQR-OAK MILL, LLC |
|
292 |
|
EQR-OVERLOOK MANOR II, LLC |
|
293 |
|
EQR-PALM HARBOR, LLC |
|
294 |
|
EQR-PALM TRACE LANDING, LLC |
|
295 |
|
EQR-PARC VUE, LLC |
|
296 |
|
EQR-PARKSIDE, GP LP |
|
297 |
|
EQR-PARKSIDE, LP |
|
298 |
|
EQR-PEACHTREE A, LLC |
|
299 |
|
EQR-PEACHTREE B, LLC |
|
300 |
|
EQR-PEACHTREE, LLC (FKA: EQR-LINCOLN PEACHTREE, LLC) |
|
301 |
|
EQR-PEMBROKE BAY, LLC |
|
|
|
Entity |
|
|
|
|
|
302 |
|
EQR-PERIMETER CENTER, LLC (FKA: EQR-LINCOLN PERIMETER CENTER, LLC) |
|
303 |
|
EQR-PHIPPS, LLC |
|
304 |
|
EQR-PIEDMONT, LLC (FKA: EQR-LINCOLN PIEDMONT, LLC) |
|
305 |
|
EQR-PINETREE/WESTBROOKE, LLC |
|
306 |
|
EQR-PLANTATION, L.L.C. |
|
307 |
|
EQR-PRIME, LLC |
|
308 |
|
EQR-PROSPECT TOWERS PHASE II LLC |
|
309 |
|
EQR-QRS HIGHLINE OAKS, INC |
|
310 |
|
EQR-Ranch at Fossil Creek, L.L.C. |
|
311 |
|
EQR-Ranch at Fossil Creek, L.P. |
|
312 |
|
EQR-REDMOND RIDGE, LLC |
|
313 |
|
EQR-REHAB MASTER GP, LLC |
|
314 |
|
EQR-RETAIL MARKS, LLC |
|
315 |
|
EQR-RID SP,LLC |
|
316 |
|
EQR-RIVEROAKS, LLC |
|
317 |
|
EQR-RIVERSIDE CORP. |
|
318 |
|
EQR-RIVERSIDE MARKET, LLC |
|
319 |
|
EQR-RIVERVIEW CONDOS, LLC |
|
320 |
|
EQR-RIVERWALK, LLC |
|
321 |
|
EQR-S & T, LLC |
|
322 |
|
EQR-SABLE PALM AT LAKE BUENA VISTA, INC. |
|
323 |
|
EQR-SABLE PALM AT LAKE BUENA VISTA, LLC |
|
324 |
|
EQR-SANDSTONE LP |
|
325 |
|
EQR-SCARBOROUGH SQUARE, LLC |
|
326 |
|
EQR-SERVICES, LLC |
|
327 |
|
EQR-SHADOW CREEK, LLC |
|
328 |
|
EQR-SIENA TERRACE, LLC |
|
329 |
|
EQR-SKYLINE TOWERS, LLC |
|
330 |
|
EQR-SMOKETREE, LLC |
|
331 |
|
EQR-SONTERRA AT FOOTHILLS RANCH LP |
|
332 |
|
EQR-SOUTH PLAINFIELD I, LP |
|
333 |
|
EQR-SOUTH PLAINFIELD, LLC |
|
334 |
|
EQR-SOUTHWOOD GP LP |
|
335 |
|
EQR-SOUTHWOOD LP |
|
336 |
|
EQR-SOUTHWOOD LP I LP |
|
337 |
|
EQR-SOUTHWOOD LP II LP |
|
338 |
|
EQR-STONELAKE GP, LLC |
|
339 |
|
EQR-STONELAKE, LP |
|
340 |
|
EQR-STONELEIGH A, LLC |
|
341 |
|
EQR-STONELEIGH B, LLC |
|
342 |
|
EQR-STONEY RIDGE SPE, LLC |
|
343 |
|
EQR-STONEY RIDGE, LLC |
|
344 |
|
EQR-STONEYBROOK, LLC |
|
345 |
|
EQR-SUERTE, LLC |
|
346 |
|
EQR-SUMMER CREEK, LLC |
|
347 |
|
EQR-SUMMERWOOD GP LP |
|
348 |
|
EQR-SUMMERWOOD LP |
|
349 |
|
EQR-SURREY DOWNS LP LP |
|
350 |
|
EQR-SWN LINE FINANCING LIMITED PARTNERSHIP |
|
351 |
|
EQR-TALLEYRAND, LLC |
|
352 |
|
EQR-TBERRY ISLE, LP |
|
353 |
|
EQR-THE CARLYLE, LLC |
|
354 |
|
EQR-THE CARLYLE, LP |
|
355 |
|
EQR-THE LAKES AT VININGS, LLC |
|
356 |
|
EQR-THE OAKS, LLC |
|
357 |
|
EQR-THE PALMS, LLC |
|
358 |
|
EQR-THE RETREAT, LLC |
|
359 |
|
EQR-THE RIDGE, LLC |
|
360 |
|
EQR-THE WATERFORD AT DEERWOOD, INC. |
|
361 |
|
EQR-THE WATERFORD AT DEERWOOD, LLC |
|
362 |
|
EQR-THE WATERFORD AT ORANGE PARK, INC. |
|
|
|
Entity |
|
|
|
|
|
363 |
|
EQR-THE WATERFORD AT ORANGE PARK, LLC |
|
364 |
|
EQR-THE WATERFORD AT REGENCY, INC. |
|
365 |
|
EQR-THE WATERFORD AT REGENCY, LLC |
|
366 |
|
EQR-TOWN CENTER, LLC |
|
367 |
|
EQR-TOWNHOMES OF MEADOWBROOK, LLC |
|
368 |
|
EQR-TRAILS AT DOMINION GENERAL PARTNERSHIP |
|
369 |
|
EQR-TURNBERRY, LLC |
|
370 |
|
EQR-TURTLE RUN, LLC |
|
371 |
|
EQR-UPTOWN SQUARE, LLC |
|
372 |
|
EQR-URBAN RENEWAL 77 HUDSON STREET, LLC |
|
373 |
|
EQR-URBAN RENEWAL JERSEY CITY, LLC (FKA EQR-LINCOLN URBAN RENEWAL JERSEY CITY, LLC) |
|
374 |
|
EQR-UWAJIMAYA VILLAGE, LLC |
|
375 |
|
EQR-VALENCIA, LLC (AKA EQR-PORTOFINO, LLC) |
|
376 |
|
EQR-VIEW POINTE, LLC |
|
377 |
|
EQR-VILLA LONG BEACH, LLC |
|
378 |
|
EQR-VILLA SERENAS SUCCESSOR BORROWER, LLC |
|
379 |
|
EQR-VILLAS OF JOSEY RANCH GP, LLC |
|
380 |
|
EQR-VILLAS OF JOSEY RANCH LP |
|
381 |
|
EQR-VININGS AT ASHLEY LAKE, L.L.C. |
|
382 |
|
EQR-VINTAGE I, LLC |
|
383 |
|
EQR-VINTAGE II, LLC |
|
384 |
|
EQR-VINTAGE, GP |
|
385 |
|
EQR-VIRGINIA, L.L.C. |
|
386 |
|
EQR-WARWICK, L.L.C. |
|
387 |
|
EQR-WATERFALL, L.L.C. |
|
388 |
|
EQR-WATERFORD PLACE, LLC |
|
389 |
|
EQR-WATERMARKE I, LLC |
|
390 |
|
EQR-WATERMARKE II, LLC |
|
391 |
|
EQR-WATERSIDE, LLC |
|
392 |
|
EQR-WATERWAYS, LLC |
|
393 |
|
EQR-WATSON G.P. |
|
394 |
|
EQR-WELLINGTON GREEN, LLC |
|
395 |
|
EQR-WEST COAST PORTFOLIO GP, LLC |
|
396 |
|
EQR-WESTFIELD VILLAGE, LLC |
|
397 |
|
EQR-WESTPORT, LLC (FKA: EQR-LINCOLN WESTPORT, LLC) |
|
398 |
|
EQR-WHISPER CREEK, LLC |
|
399 |
|
EQR-WIMBLEDON OAKS LP |
|
400 |
|
EQR-WINDSOR AT FAIR LAKES, LLC |
|
401 |
|
EQR-WOOD FOREST, INC. |
|
402 |
|
EQR-WOOD FOREST, LLC |
|
403 |
|
EQR-WOODRIDGE I GP LP |
|
404 |
|
EQR-WOODRIDGE I LP |
|
405 |
|
EQR-WOODRIDGE II GP LP |
|
406 |
|
EQR-WOODRIDGE II LP |
|
407 |
|
EQR-WOODRIDGE III LP |
|
408 |
|
EQR-WOODRIDGE, LLC |
|
409 |
|
EQR-WYNDRIDGE II, L.L.C. |
|
410 |
|
EQR-WYNDRIDGE III, L.L.C. |
|
411 |
|
EQR-ZURICH, LLC (FKA: EQR-LINCOLN ZURICH, LLC) |
|
412 |
|
EQUITY COMMUNITY FOUNDATION |
|
413 |
|
EQUITY CORPORATE HOUSING HOLDING CO., INC. (FKA: GLOBE HOLDING CO., INC.) |
|
414 |
|
EQUITY CORPORATE HOUSING, INC. (FKA:GLOBE BUSINESS RESOURCES, INC.) |
|
415 |
|
EQUITY MARINA BAY PHASE II, LLC (FKA LINCOLN MARINA BAY PHASE II, LLC) |
|
416 |
|
EQUITY RESIDENTIAL CONDOMINIUMS, LLC |
|
417 |
|
EQUITY RESIDENTIAL FOUNDATION (FKA Equity Community Foundation) |
|
418 |
|
EQUITY RESIDENTIAL MANAGEMENT, LLC |
|
419 |
|
EQUITY RESIDENTIAL MORTGAGE HOLDING CORPORATION |
|
420 |
|
EQUITY RESIDENTIAL PROPERTIES MANAGEMENT CORP |
|
421 |
|
EQUITY RESIDENTIAL PROPERTIES MANAGEMENT CORP II |
|
422 |
|
EQUITY RESIDENTIAL PROPERTIES MANAGEMENT CORP PROTECTIVE TRUST |
|
423 |
|
EQUITY RESIDENTIAL PROPERTIES TRUST (POST WRP MERGER) |
|
|
|
Entity |
|
|
|
|
|
424 |
|
EQUITY-LODGE VENTURE LTD. |
|
425 |
|
ERP NEW ENGLAND PROGRAM, LLC |
|
426 |
|
ERP OPERATING LIMITED PARTNERSHIP |
|
427 |
|
ERP/LEXFORD GP LLC |
|
428 |
|
ERP/LEXFORD LLC |
|
429 |
|
ERPG CANYON CREEK, LP |
|
430 |
|
ERP-NEW ENGLAND PROGRAM, LLC |
|
431 |
|
ERP-QRS ARBORS, INC. |
|
432 |
|
ERP-QRS BRETON HAMMOCKS, INC. |
|
433 |
|
ERP-QRS BS, INC. |
|
434 |
|
ERP-QRS CEDAR CREST, INC. |
|
435 |
|
ERP-QRS CEDAR RIDGE, INC. |
|
436 |
|
ERP-QRS COUNTRY CLUB I, INC. |
|
437 |
|
ERP-QRS COUNTRY CLUB II, INC. |
|
438 |
|
ERP-QRS COUNTRY RIDGE, INC. |
|
439 |
|
ERP-QRS CPRT II, INC. |
|
440 |
|
ERP-QRS CPRT, INC. |
|
441 |
|
ERP-QRS CREEKSIDE OAKS, INC. |
|
442 |
|
ERP-QRS EMERALD PLACE, INC. |
|
443 |
|
ERP-QRS ESSEX PLACE, INC. |
|
444 |
|
ERP-QRS FAIRFIELD, INC. |
|
445 |
|
ERP-QRS FLATLANDS, INC. |
|
446 |
|
ERP-QRS GEORGIAN WOODS ANNEX, INC. |
|
447 |
|
ERP-QRS GLENLAKE CLUB, INC. |
|
448 |
|
ERP-QRS GROVE L.P., INC. |
|
449 |
|
ERP-QRS HARBOR POINTE, INC. |
|
450 |
|
ERP-QRS HUNTER’S GLEN, INC. |
|
451 |
|
ERP-QRS LINCOLN, INC. |
|
452 |
|
ERP-QRS LODGE (OK), INC. |
|
453 |
|
ERP-QRS MAGNUM, INC. |
|
454 |
|
ERP-QRS MET CA, INC. |
|
455 |
|
ERP-QRS NORTHAMPTON I, INC. |
|
456 |
|
ERP-QRS SONTERRA AT FOOTHILLS RANCH, INC. |
|
457 |
|
ERP-QRS SWN LINE, INC. |
|
458 |
|
ERP-QRS TOWNE CENTRE III, INC. |
|
459 |
|
ERP-QRS TOWNE CENTRE IV, INC. |
|
460 |
|
ERP-SOUTHEAST PROPERTIES, LLC |
|
461 |
|
ERR-MILLBROOK I, LLC |
|
462 |
|
ESSEX SQUARE APTS, LTD |
|
463 |
|
EVANS WITHYCOMBE FINANCE, L.P. |
|
464 |
|
EVANS WITHYCOMBE MANAGEMENT INC. |
|
465 |
|
EVANS WITHYCOMBE RESIDENTIAL LIMITED PARTNERSHIP |
|
466 |
|
FEATHER RIVER COMMUNITY RENTALS, L.P. |
|
467 |
|
FEATHER RIVER G.P. CORP. |
|
468 |
|
FORT LEWIS COMMUNITIES, LLC |
|
469 |
|
FORT LEWIS SPE, INC. |
|
470 |
|
FOUR LAKES CONDOMINIUM II, LLC |
|
471 |
|
FOUR LAKES CONDOMINIUM III, LLC |
|
472 |
|
FOUR LAKES CONDOMINIUM IV, LLC |
|
473 |
|
FOUR LAKES CONDOMINIUM V, LLC |
|
474 |
|
FOUR LAKES CONDOMINIUM, LLC |
|
475 |
|
FOUR LAKES II, LLC. |
|
476 |
|
FOURTH TOWNE CENTRE LIMITED PARTNERSHIP |
|
477 |
|
FOX RIDGE ASSOCIATES, L.P. |
|
478 |
|
FOX RIDGE G.P. CORP. |
|
479 |
|
FOXTON APTS OF SEYMOUR, LTD |
|
480 |
|
FOXWOODBURG, LLC |
|
481 |
|
GC CHAPARRAL ASSOC, LP |
|
482 |
|
GC COUNTRY CLUB WOODS ASSOC, LP |
|
483 |
|
GC COUNTRY CLUB WOODS, LP |
|
484 |
|
GC GREENBRIAR ASSOC, LTD |
|
|
|
Entity |
|
|
|
|
|
485 |
|
GC GREENBRIAR, LP |
|
486 |
|
GC HESSIAN HILLS ASSOC, LP |
|
487 |
|
GC HESSIAN HILLS, LP |
|
488 |
|
GC HIGH RIVER ASSOC, LP |
|
489 |
|
GC HIGH RIVER, LP |
|
490 |
|
GC PEMBROKE ASSOC, LP |
|
491 |
|
GC SOUTHEAST PARTNERS, LP |
|
492 |
|
GC SPRING LAKE MANOR ASSOC, LP |
|
493 |
|
GC SPRING LAKE MANOR, LP |
|
494 |
|
GC THREE CHOPT WEST ASSOC, LP |
|
495 |
|
GC THREE CHOPT WEST, LP |
|
496 |
|
GC TOWN & COUNTRY/COUNTRY PLACE ASSOC, LP |
|
497 |
|
GC TOWN & COUNTRY/COUNTRY PLACE, LP |
|
498 |
|
GC TOWNHOUSE ASSOC, LP |
|
499 |
|
GC TOWNHOUSE, LP |
|
500 |
|
GC TWIN GATES EAST ASSOC, LP |
|
501 |
|
GC TWIN GATES EAST, LP |
|
502 |
|
GC WILL-O-WISP ARMS, LP |
|
503 |
|
GC WILL-O-WISP ASSOC, LP |
|
504 |
|
GEARY COURTYARD ASSOCIATES |
|
505 |
|
GEORGIAN WOODS ANNEX ASSOCIATES |
|
506 |
|
GLENLAKE CLUB L.P. |
|
507 |
|
GPT 929 HOUSE, LLC |
|
508 |
|
GPT ABINGTON GLEN, LLC |
|
509 |
|
GPT ABINGTON LAND, LLC |
|
510 |
|
GPT ACTON, LLC |
|
511 |
|
GPT BRIAR KNOLL, LLC |
|
512 |
|
GPT CC, LLC |
|
513 |
|
GPT CEDAR GLEN, LLC |
|
514 |
|
GPT CG, LLC |
|
515 |
|
GPT CHESTNUT GLEN, LLC |
|
516 |
|
GPT CONWAY COURT, LLC |
|
517 |
|
GPT EAST HAVEN, LLC |
|
518 |
|
GPT EAST PROVIDENCE, LLC |
|
519 |
|
GPT ENFIELD, LLC |
|
520 |
|
GPT FREEPORT, LLC |
|
521 |
|
GPT GLEN GROVE, LLC |
|
522 |
|
GPT GLEN MEADOW, LLC |
|
523 |
|
GPT GOF II, LLC |
|
524 |
|
GPT GOSNOLD GROVE, LLC |
|
525 |
|
GPT GP III, LLC |
|
526 |
|
GPT HERITAGE GREEN, LLC |
|
527 |
|
GPT HG, LLC |
|
528 |
|
GPT HIGHLAND GLEN, LLC |
|
529 |
|
GPT HIGHMEADOW, LLC |
|
530 |
|
GPT HILLTOP, LLC |
|
531 |
|
GPT JACLEN TOWER, LLC |
|
532 |
|
GPT LONGFELLOW GLEN, LLC |
|
533 |
|
GPT LONGMEADOW ASSOCIATES, LLC |
|
534 |
|
GPT NEHOIDEN GLEN, LLC |
|
535 |
|
GPT NOONAN GLEN, LLC |
|
536 |
|
GPT NORTON GLEN, LLC |
|
537 |
|
GPT OLD MILL GLEN, LLC |
|
538 |
|
GPT PHILLIPS PARK, LLC |
|
539 |
|
GPT PLAINVILLE, LLC |
|
540 |
|
GPT RG AMHERST, LLC |
|
541 |
|
GPT RG FALL RIVER, LLC |
|
542 |
|
GPT RG MILFORD, LLC |
|
543 |
|
GPT RG, LLC |
|
544 |
|
GPT RIBBON MILL, LLC |
|
545 |
|
GPT ROCKINGHAM GLEN, LLC |
|
|
|
Entity |
|
|
|
|
|
|
|
546 |
|
GPT SHG, LLC |
|
|
547 |
|
GPT STURBRIDGE, LLC |
|
|
548 |
|
GPT SUMMER HILL GLEN, LLC |
|
|
549 |
|
GPT TANGLEWOOD, LLC+B492 |
|
|
550 |
|
GPT WEBSTER GREEN, LLC |
|
|
551 |
|
GPT WEST SPRINGFIELD, LLC |
|
|
552 |
|
GPT WESTFIELD, LLC |
|
|
553 |
|
GPT WESTWOOD GLEN, LLC |
|
|
554 |
|
GPT WG, LLC |
|
|
555 |
|
GPT WILG, LLC |
|
|
556 |
|
GPT WILKENS GLEN, LLC |
|
|
557 |
|
GPT WINCHESTER WOOD, LLC |
|
|
558 |
|
GPT WINDSOR, LLC |
|
|
559 |
|
GR CEDAR GLEN, LP |
|
|
560 |
|
GR CONWAY COURT, LP |
|
|
561 |
|
GR FARMINGTON SUMMIT, LLC |
|
|
562 |
|
GR HIGHLAND GLEN, LP |
|
|
563 |
|
GR NORTHEAST APARTMENT ASSOCIATES, LLC |
|
|
564 |
|
GR ROCKINGHAM GLEN, LP |
|
|
565 |
|
GR SUMMER HILL GLEN, LP |
|
|
566 |
|
GR WEST HARTFORD CENTRE, LLC |
|
|
567 |
|
GR WESTWOOD GLEN, LP |
|
|
568 |
|
GR WESTWYND ASSOCIATES, LLC |
|
|
569 |
|
GR WILKENS GLEN, LP |
|
|
570 |
|
GRAN TREE CORPORTION |
|
|
571 |
|
GRAND OASIS CONDOMINIUM, LLC |
|
|
572 |
|
GREENGLEN ATPS OF WHEELERSBURG, LTD |
|
|
573 |
|
GREENLEAF APARTMENTS, LTD |
|
|
574 |
|
GREENTREE APARTMENTS LP |
|
|
575 |
|
GR-HERITAGE COURT ASSOCIATES, LLC (FKA GR-HERITAGE COURT ASSOCIATES, LP) |
|
|
576 |
|
GROVE DEVELOPMENT, LLC |
|
|
577 |
|
GROVE OPERATING LP |
|
|
578 |
|
GROVE ROCKY HILL, LLC |
|
|
579 |
|
GUILFORD COMPANY, INC. |
|
|
580 |
|
GUILFORD PARTNERS II |
|
|
581 |
|
HESSIAN HILLS APARTMENT ASSOC, LTD |
|
|
582 |
|
HIDDEN LAKE ASSOCIATES, L.P. |
|
|
583 |
|
HIDDEN LAKE G.P. CORP. |
|
|
584 |
|
HIGH RIVER ASSOC, LTD |
|
|
585 |
|
HIGH RIVER PHASE I, LTD |
|
|
586 |
|
HM 9th AVENUE, LLC |
|
|
587 |
|
HUNTERS’S GLEN GENERAL PARTNERSHIP |
|
|
588 |
|
HUNTINGTON, LLC |
|
|
589 |
|
KINGSPORT APARTMENTS, LLC |
|
|
590 |
|
LAKEVIEW COMMUNITY RENTALS, L.P. |
|
|
591 |
|
LAKEVIEW G.P. CORP. |
|
|
592 |
|
LAKEWOOD COMMUNITY RENTALS G.P. CORP. |
|
|
593 |
|
LAKEWOOD COMMUNITY RENTALS, L.P. |
|
|
594 |
|
LANDON LEGACY PARTNERS LIMITED |
|
|
595 |
|
LANDON PRAIRIE CREEK PARTNERS LIMITED |
|
|
596 |
|
LANTERN COVE ASSOCIATES, L.P. |
|
|
597 |
|
LANTERN COVE G.P. CORP. |
|
|
598 |
|
LAWRENCE STREET PARTNERS, LLC |
|
|
599 |
|
LENOX PLACE LP |
|
|
600 |
|
LEXFORD PARTNERS, LLC |
|
|
601 |
|
LEXFORD PROPERTIES, LP |
|
|
602 |
|
LINCOLN MAPLES ASSOCIATES, LLC |
|
|
603 |
|
MCCASLIN HIDDEN LAKES, LTD. |
|
|
604 |
|
MCCASLIN RIVERHILL, LTD. |
|
|
605 |
|
MCKINLEY HILLS PARTNERS-85, |
|
|
606 |
|
MERIDAN GUILFORD BGP CORPORATION |
|
|
|
|
Entity |
|
|
|
|
|
607 |
|
MERIDAN GUILFORD CGP CORPORATION |
|
608 |
|
MERIDAN GUILFORD NLPGP CORPORATION |
|
609 |
|
MERIDAN GUILFORD PGP CORPORATION |
|
610 |
|
MERRY LAND DOWNREIT I LP |
|
611 |
|
MESA DEL OSO ASSOCIATES, L.P. |
|
612 |
|
MESA DEL OSO G.P. CORP. |
|
613 |
|
MOBILE APARTMENT ASSOC, LTD |
|
614 |
|
MONTGOMERY REAL ESTATE INVESTORS, LTD |
|
615 |
|
MULTIFAMILY PORTFOLIO GP LIMITED PARTNERSHIP |
|
616 |
|
MULTIFAMILY PORTFOLIO LP LIMITED PARTNERSHIP |
|
617 |
|
MULTIFAMILY PORTFOLIO PARTNERS, INC. |
|
618 |
|
NHP HS FOUR, INC. |
|
619 |
|
NINTH AVENUE AND 38TH STREET, LLC |
|
620 |
|
NORTHRIDGE LAKES LP |
|
621 |
|
NORTHWOOD APTS, LTD |
|
622 |
|
NRL ASSOCIATES LP |
|
623 |
|
OAK MILL II APARTMENTS, LLC |
|
624 |
|
OAKS AT BAYMEADOWS ASSOCIATES |
|
625 |
|
OAKS AT REGENCY ASSOCIATES |
|
626 |
|
OAKWOOD VILLAGE APARTMENTS II, LTD |
|
627 |
|
OLD REDWOODS, LLC |
|
628 |
|
PEMBROKE LAKE APARTMENT ASSOC, LTD |
|
629 |
|
POINTE EAST CONDOMINIUM, LLC |
|
630 |
|
PRESERVE CONDOMINIUM HOMES |
|
631 |
|
QRS MARKS A, INC. |
|
632 |
|
QRS MARKS B, INC. |
|
633 |
|
QRS WARWICK, INC. |
|
634 |
|
QRS-740 RIVER DRIVE, INC. |
|
635 |
|
QRS-ARBORETUM, INC. |
|
636 |
|
QRS-ARTCAPLOAN, INC. |
|
637 |
|
QRS-BOND, INC. |
|
638 |
|
QRS-CHARDONNAY PARK, INC |
|
639 |
|
QRS-CODELLE, INC. |
|
640 |
|
QRS-CONNOR, INC. |
|
641 |
|
QRS-COVE, INC. |
|
642 |
|
QRS-EMPLOYER, INC. |
|
643 |
|
QRS-FANCAP 2000A, INC.B275 |
|
644 |
|
QRS-FERNBROOK, INC. |
|
645 |
|
QRS-GREENTREE I, INC. |
|
646 |
|
QRS-LLC, INC. |
|
647 |
|
QRS-NORTH HILL, INC |
|
648 |
|
QRS-SCARBOROUGH, INC. |
|
649 |
|
QRS-SIENA TERRACE, INC. |
|
650 |
|
QRS-SMOKETREE, INC. |
|
651 |
|
QRS-SUMMIT CENTER, INC. |
|
652 |
|
QRS-TOWERS AT PORTSIDE, INC. |
|
653 |
|
QRS-TOWNHOMES OF MEADOWBROOK, INC. |
|
654 |
|
QRS-VININGS AT ASHLEY LAKE, INC. |
|
655 |
|
QRS-WATERFALL, INC. |
|
656 |
|
RAVENWOOD ASSOC, LTD |
|
657 |
|
RESERVE SQUARE, INC. |
|
658 |
|
RESIDENTIAL INSURANCE AGENCY, LLC (DE) |
|
659 |
|
RESIDENTIAL INSURANCE AGENCY, LLC (OH) |
|
660 |
|
RICHMOND APARTMENT ASSOC, LTD |
|
661 |
|
SARASOTA BENEVA PLACE ASSOICATES, LTD. |
|
662 |
|
SCARBOROUGH ASSOCIATES |
|
663 |
|
SCHOONER BAY I ASSOCIATES, L.P. |
|
664 |
|
SCHOONER BAY I G.P. CORP. |
|
665 |
|
SCHOONER BAY II ASSOCIATES, L.P. |
|
666 |
|
SCHOONER BAY II G.P. CORP. |
|
667 |
|
SECOND AVENUE, LLC |
|
|
|
Entity |
|
|
|
|
|
|
|
668 |
|
SECOND COUNRTY CLUB ASSOCIATES LIMITED PARTNERSHIP |
|
|
669 |
|
SECOND GEORGIAN WOODS LIMITED PARTNERSHIP |
|
|
670 |
|
SECOND TOWNE CENTRE LP |
|
|
671 |
|
SILVER SPRING GATEWAY RESIDENTIAL II, LLC |
|
|
672 |
|
SOUTH SHORE ASSOCIATES, L.P. |
|
|
673 |
|
SOUTH SHORE G.P. CORP. |
|
|
674 |
|
SPRING LAKE MANOR ASSOC, LTD |
|
|
675 |
|
SPRINGBROOK LAND, LLC |
|
|
676 |
|
SPRINGTREE APTS, LTD |
|
|
677 |
|
SQUAW PEAK CONDOMINIUM, LLC |
|
|
678 |
|
SUMMIT PLACE, LLC |
|
|
679 |
|
TANGLEWOOD APARTMENTS, LLC |
|
|
680 |
|
THE CROSSINGS ASSOCIATES |
|
|
681 |
|
THE FOUR LAKES CONDOMINIUM HOMES CONDOMINIUM |
|
|
682 |
|
THE LANDINGS HOLDING COMPANY, LLC |
|
|
683 |
|
THE LANDINGS URBAN RENEWAL COMPANY, LLC |
|
|
684 |
|
THE WIMBERLY APARTMENT HOMES, LTD. |
|
|
685 |
|
THIRD TOWNE CENTRE LIMITED PARTNERSHIP |
|
|
686 |
|
TIERRA ANTIGUA ASSOCIATES, L.P. |
|
|
687 |
|
TIERRA ANTIGUA G.P. CORP. |
|
|
688 |
|
TOWERS AT PORTSIDE URBAN RENEWAL COMPANY, LLC |
|
|
689 |
|
TOWNHOUSE APARTMENT ASSOC, LTD |
|
|
690 |
|
TWIN GATES APARTMENT ASSOC, LTD |
|
|
691 |
|
VENETIAN CONDOMINIUM, LLC |
|
|
692 |
|
VERONA CONDOMINIUM, LLC |
|
|
693 |
|
VINTAGE ASSOCIATES |
|
|
694 |
|
VISTA MONTANA PARK APARTMENTS, LLC |
|
|
695 |
|
VISTA MONTANA PARK HOMES, LLC |
|
|
696 |
|
WADLINGTON INVESTMENTS GENERAL PARTNERSHIP |
|
|
697 |
|
WADLINGTON, INC. |
|
|
698 |
|
WATERFIELD SQUARE I ASSOCIATES, L.P. |
|
|
699 |
|
WATERFIELD SQUARE I G.P. CORP. |
|
|
700 |
|
WATERFIELD SQUARE II ASSOCIATES, L.P. |
|
|
701 |
|
WATERFIELD SQUARE II G.P. CORP. |
|
|
702 |
|
WATERMARKE ASSOCIATES |
|
|
703 |
|
WHARF HOLDING, LLC |
|
|
704 |
|
WHRP, INC. |
|
|
705 |
|
WILLOW BROOK ASSOCIATES, L.P. |
|
|
706 |
|
WILLOW BROOK G.P. CORP. |
|
|
707 |
|
WILLOW CREEK COMMUNITY RENTALS, L.P. |
|
|
708 |
|
WILLOW CREEK G.P. CORP. |
|
|
709 |
|
WILL-O-WISP ASSOC, LP |
|
|
710 |
|
WINDSOR PLACE, LLC |
|
|
711 |
|
WINTER PARK ASSOC, LP |
|
|
712 |
|
WOOD FOREST ASSOCIATES |
|
|
713 |
|
WOODCREST (AUGUSTA), LLC |
|
Exhibit 23.1
Consent of Independent Registered Public Accounting Firm
We consent to the incorporation by reference in the Registration Statements (Forms S-3 No. 333-45533, No. 333-39289, No. 333-100631, No. 333-63176, No. 333-80835, No. 333-72961, No. 333-12983, No. 333-06873, No. 33-97680 and No. 33-84974; Forms S-8 No. 333-06869, No. 333-107244, No. 333-83403, No. 333-102609, No. 333-66257, No. 333-88237 and No. 333-135503; and Forms S-4 No. 333-44576 and No. 333-35873) of Equity Residential and in the related Prospectuses of our reports dated February 21, 2007 with respect to the consolidated financial statements and schedule of Equity Residential, Equity Residential management’s assessment of the effectiveness of internal control over financial reporting and the effectiveness of internal control over financial reporting of Equity Residential, included in this Annual Report (Form 10-K) for the year ended December 31, 2006.
|
|
/s/ Ernst & Young LLP |
|
|
Ernst & Young LLP |
Chicago, Illinois
February 26, 2007
I, David J. Neithercut, Chief Executive Officer of Equity Residential, certify that:
1. I have reviewed this annual report on Form 10-K of Equity Residential;
2. 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;
3. 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;
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a) 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;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant’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
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a) 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’s ability to record, process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 28, 2007 |
|||
|
|
/s/ |
David J. Neithercut |
|
|
|
|
David J. Neithercut |
|
|
|
|
Chief Executive Officer |
|
I, Donna Brandin, Chief Financial Officer of Equity Residential, certify that:
1. I have reviewed this annual report on Form 10-K of Equity Residential;
2. 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;
3. 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;
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a) 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;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant’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
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a) 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’s ability to record, process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date: February 28, 2007 |
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/s/ |
Donna Brandin |
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Donna Brandin |
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Chief Financial Officer |
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Exhibit 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of Equity Residential (the “Company”) on Form 10-K for the period ending December 31, 2006 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, David J. Neithercut, Chief Executive Officer of the Company, certify, pursuant to 18.U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) 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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/s/ |
David J. Neithercut |
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David J. Neithercut |
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Chief Executive Officer |
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February 28, 2007 |
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Exhibit 32.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of Equity Residential (the “Company”) on Form 10-K for the period ending December 31, 2006 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Donna Brandin, Chief Financial Officer of the Company, certify, pursuant to 18.U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) 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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/s/ |
Donna Brandin |
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Donna Brandin |
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Chief Financial Officer |
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February 28, 2007 |
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