10-K

FORM 10-K
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

ý ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended DECEMBER 31, 2004

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)

Maryland	13-3675988
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
Two North Riverside Plaza, Chicago, Illinois	60606
(Address of Principal Executive Offices)	(Zip Code)

(312) 474-1300

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Common Shares of Beneficial Interest, $0.01 Par Value	New York Stock Exchange
(Title of Class)	(Name of Each Exchange on Which Registered)
Preferred Shares of Beneficial Interest, $0.01 Par Value	New York Stock Exchange
(Title of Class)	(Name of Each Exchange on Which Registered)

Securities registered pursuant to Section 12(g) of the Act:  None

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  ý  No  o

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act).

Yes  ý  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

The aggregate market value of Common Shares held by non-affiliates of the Registrant was approximately $8.3 billion based upon the closing price on June 30, 2004 of $29.73 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 February 3, 2005 was 286,055,990.

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 15, 2005, 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

			PAGE
PART I.
	Item 1.	Business	4
	Item 2.	The Properties	26
	Item 3.	Legal Proceedings	30
	Item 4.	Submission of Matters to a Vote of Security Holders	30
PART II.
	Item 5.	Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities	31
	Item 6.	Selected Financial Data	31
	Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	33
	Item 7A.	Quantitative and Qualitative Disclosure about Market Risk	50
	Item 8.	Financial Statements and Supplementary Data	51
	Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	51
	Item 9A.	Controls and Procedures	51
	Item 9B.	Other Information	51
PART III.
	Item 10.	Trustees and Executive Officers of the Registrant	52
	Item 11.	Executive Compensation	52
	Item 12.	Security Ownership of Certain Beneficial Owners and Management	52
	Item 13.	Certain Relationships and Related Transactions	52
	Item 14.	Principal Accountant Fees and Services	52
PART IV.
	Item 15.	Exhibits and Financial Statement Schedules	53

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Item 1.  Business

General

Equity Residential (“EQR”), formed in March 1993, is a fully integrated real estate company engaged in the acquisition, development, ownership, management and operation of multifamily properties.  EQR has elected to be taxed as a real estate investment trust (“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 leases (under operating leases) approximately thirty-five divisional, regional and area property management offices throughout the United States.

EQR is the general partner of, and as of December 31, 2004 owned an approximate 93.3% 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 various subsidiaries.  References to the “Company” include EQR, the Operating Partnership and each of the partnerships, limited liability companies and corporations controlled by the Operating Partnership or EQR.

As of December 31, 2004, the Company, directly or indirectly through investments in title holding entities, owned all or a portion of 939properties in 32 states and the District of Columbia consisting of 200,149 units.  The ownership breakdown includes:

	Properties	Units
Wholly Owned Properties	842	176,711
Partially Owned Properties (Consolidated)	39	7,220
Unconsolidated Properties	58	16,218
	939	200,149

As of March 1, 2005, the Company has approximately 6,000 employees who provide real estate operations, leasing, legal, financial, accounting, acquisition, disposition, development and other support functions.

Certain capitalized terms as 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 both current income and long-term growth in income, thereby increasing:

•the value of the properties;

•distributions on a per Common Share basis; and

•shareholders’ value.

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The Company’s strategy for accomplishing these objectives include:

•Leveraging our size and scale in four critical ways:

•Investing or “recycling” capital investments in apartment communities located in strategically targeted markets, to maximize our total return on an enterprise level;

•Meeting the needs of our customers 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 customers reasons to stay with Equity 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 and Development Strategies

The Company anticipates that future property acquisitions and developments 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 additional 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 part, the recognition of taxable income or gain, which might otherwise result from the sales.

When evaluating potential acquisitions and developments, the Company generally considers the following factors:

•the geographic area and type of community;

•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;

•income levels and employment growth trends in the relevant market;

•employment and household growth and net migration of the relevant market’s population;

•the potential for economic growth and the tax and regulatory environment of the community in which the property is located;

•the occupancy and demand by residents for properties of a similar type in the vicinity (the overall market and submarket);

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•the prospects for liquidity through sale, financing or refinancing of the property;

•the benefits of integration into existing operations;

•barriers to entry that would limit competition (zoning laws, building permit availability, supply of undeveloped or developable real estate, local building costs and construction labor costs among other factors);

•purchase prices and yields of available existing stabilized communities, if any; and

•competition from existing multifamily properties, residential properties under development and the potential for the construction of new multifamily properties in the area.

Disposition Strategies

When evaluating potential dispositions,the Company generally considers the following factors:

•low barrier-to-entry (high supply);

•weak economic predictors (low demand);

•markets where the Company does not intend to establish long-term concentrations;

•age or location of a particular property; 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.

Financing Strategies

The Company’s “Consolidated Debt-to-Total Market Capitalization Ratio” as of December 31, 2004 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 and preference interests outstanding.

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Capitalization as of December 31, 2004

Total Debt			$	6,459,806,228
Common Shares & OP Units	305,629,855
Common Share Equivalents (see below)	1,968,453
Total Outstanding at year-end	307,598,308
Common Share Price at December 31, 2004	$	36.18
			11,128,906,783
Perpetual Preferred Shares Liquidation Value			615,000,000
Perpetual Preference Interests Liquidation Value			171,500,000
Total Market Capitalization			$	18,375,213,011
Total Debt/Total Market Capitalization			35		%

Convertible Preferred Shares, Preference Interests
and Junior Preference Units
as of December 31, 2004

	Shares/Units	Conversion Ratio	Common Share Equivalents
Preferred Shares:
Series E	811,724	1.1128	903,286
Series H	36,934	1.4480	53,480
Preference Interests:
Series H	190,000	1.5108	287,052
Series I	270,000	1.4542	392,634
Series J	230,000	1.4108	324,484
Junior Preference Units:
Series B	7,367	1.020408	7,517
Total			1,968,453

The Company’s policy is to maintain a ratio of consolidated debt-to-total market capitalization of less than 50% and not incur indebtedness other than short-term trade, employee compensation or similar indebtedness that will be paid in the ordinary course of business.

Equity Offerings For the Years Ended December 31, 2004, 2003 and 2002

During 2004, the Company:

•Issued 3,350,759 Common Shares pursuant to its Share Incentive Plans and received net proceeds of approximately $79.0 million.

•Issued 275,616 Common Shares pursuant to its Employee Share Purchase Plan and received net proceeds of approximately $6.9 million.

During 2003, the Company:

•Issued 600,000 Series N Cumulative Redeemable Preferred Shares with a liquidation value of $150.0 million and received net proceeds of approximately $145.3 million.

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•Issued 3,249,555 Common Shares pursuant to its Share Incentive Plans and received net proceeds of approximately $68.4 million.

•Issued 289,274 Common Shares pursuant to its Employee Share Purchase Plan and received net proceeds of approximately $6.3 million.

During 2002, the Company:

•Issued 1,435,115 Common Shares pursuant to its Share Incentive Plans and received net proceeds of approximately $29.6 million.

•Issued 324,238 Common Shares pursuant to its Employee Share Purchase Plan and received net proceeds of approximately $7.4 million.

•Issued 31,354 Common Shares pursuant to its Share Purchase – DRIP Plan and received net proceeds of approximately $0.9 million.

•Issued 41,407 Common Shares pursuant to its Dividend Reinvestment – DRIP Plan and received net proceeds of approximately $1.2 million.

•Repurchased 5,092,300 of its Common Shares on the open market at an average price of $22.58 per share.  The purchases were made between October 1 and October 22, 2002.  The Company paid approximately $115.0 million in connection therewith.  These shares were subsequently retired.

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 2, 2005, $956.5 million in equity securities remained available for issuance under this registration statement.

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, 2005, 23,069,873 shares are available for issuance under this plan.

Cumulative through December 31, 2004, the Company, through a subsidiary of the Operating Partnership, issued and has outstanding various series of Preference Interests (the “Preference Interests”) with an equity value of $206.0million receiving net proceeds of $200.9 million.

Debt Offerings For the Years Ended December 31, 2004, 2003 and 2002

During 2004:

•The Operating Partnership issued $300.0 million of five-year 4.75% redeemable 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% redeemable 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.

During 2003:

•The Operating Partnership issued $400.0 million of ten-year 5.20% redeemable unsecured fixed rate

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notes (the “April 2013 Notes”) in a public debt offering in March 2003.  The April 2013 Notes were issued at a discount, which is being amortized over the life of the notes on a straight-line basis.  The April 2013 Notes are due April 1, 2013 with interest payable semiannually in arrears on April 1 and October 1, commencing October 1, 2003.The Operating Partnership received net proceeds of approximately $397.5 million in connection with this issuance.

During 2002:

•The Operating Partnership issued $400.0 million of ten-year 6.625% redeemable unsecured fixed rate notes (the “March 2012 Notes”) in a public debt offering in March 2002.  The March 2012 Notes were issued at a discount, which is being amortized over the life of the notes on a straight-line basis.  The March 2012 Notes are due March 15, 2012 with interest payable semiannually in arrears on September 15 and March 15, commencing September 15, 2002.The Operating Partnership received net proceeds of approximately $394.5 million in connection with this issuance.

•The Operating Partnership issued $50.0 million of five-year 4.861% redeemable unsecured fixed rate notes (the “November 2007 Notes”) in a public debt offering in November 2002.  The November 2007 Notes are due November 30, 2007 with interest payable semiannually in arrears on May 30 and November 30, commencing May 30, 2003.The Operating Partnership received net proceeds of approximately $49.9 million in connection with this issuance.

In June 2003, the Operating Partnership filed and the SEC declared effective a Form S-3 registration statement to register $2.0 billion of debt securities.  In addition, the Operating Partnership carried over $280.0 million related to a prior registration statement.  As of February 2, 2005, $1.48 billion in debt securities remained available for issuance under this registration statement.

Credit Facilities

In May 2002, the Operating Partnership obtained a three-year $700.0 million unsecured revolving credit facility maturing May 29, 2005.  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 upon bids received from the lending group.  As of December 31, 2004, $150.0 million was outstanding and $65.4 million was restricted (dedicated to support letters of credit and not available for borrowing) on the credit facility.  During the year ended December 31, 2004, the weighted average interest rate on borrowings under the line of credit was 1.73%.

The Operating Partnership is currently negotiating a new credit facility to replace or expand its existing facility and fully expects to obtain this at current or improved terms in March or April 2005.

Business Combinations

In January 2002, the Company sold the former Globe Business Resources, Inc. (“Globe”) furniture rental business it acquired in July 2000 for approximately $30.0 million in cash, which approximated the net book value at the sale date.  The Company has retained ownership of the former Globe short-term furnished housing business, which is now known as Equity Corporate Housing (“ECH”).

For the year ended December 31, 2002, the Company recorded approximately $17.1 million of asset impairment charges related to ECH.  Following the guidance in SFAS No. 142, these charges were the result of the Company’s decision to reduce the carrying value of ECH to $30.0 million, given the weakness in the economy and management’s expectations for near-term performance and were determined based upon a discounted cash flow analysis of the business.  This impairment loss is reflected on the consolidated statements of operations as impairment on corporate housing business and on the consolidated balance sheets as a reduction in goodwill, net.

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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.   Throughout 2003 and 2004, historically low mortgage interest rates coupled with increased residential construction and single-family home sales have had an adverse competitive effect on the Company.

Risk Factors

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.

Set forth below are the risks that we believe are important to investors who purchase or own 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; preference units (“Units”); or units of limited partnership interest (“OP Units”) of ERP Operating Limited Partnership, our operating partnership, which are redeemable on a one-for-one basis for common shares or their cash equivalent.  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.”

Our Performance and Share Value are Subject to Risks Associated with the Real Estate Industry

General

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 climate, 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.

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.

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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 specifically to convert directly into condominiums as well as upgrade and sell existing properties as individual condominiums.  We may underestimate the costs necessary to bring an acquired or condominium conversion property up to standards established for its intended market position or to develop a property.  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 we expect to sell individual condominiums.  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 over the next few years 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 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 change 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 taxes, income taxes or other 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.

As the largest publicly traded owner of multifamily properties, we may become involved in legal proceedings, including but not limited to, consumer, employment, tort and commercial, 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 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 four years, there have been an increasing number of lawsuits against owners and managers of multifamily properties other than the Company alleging personal injury and property damage caused by the presence of mold in residential real estate.  Some of these lawsuits have resulted in

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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 one or more of our properties.

Insurance Policy Deductibles and Exclusions

In order to partially mitigate the substantial increase in insurance costs in recent years, management has determined to gradually increase deductible and self-insured retention amounts.  As of December 31, 2004, 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.  The Company’s liability and worker’s compensation policies at December 31, 2004, 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 Charley, Frances, Ivan and Jeanne, 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” 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.  At the present time, the Company has determined that it is not economically prudent to obtain property terrorism insurance for its entire portfolio to the extent otherwise available, especially given the significant risks that are not covered by such insurance.  As of December 31, 2004, the Company’s high-rise properties were insured for $125 million in terrorism insurance coverage, with a $5 million deductible.  In the event of a terrorist attack impacting one or more of the 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 high-rise terrorism insurance coverage help to mitigate its exposure to the risks associated with potential terrorist attacks.

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Debt Financing, Preferred Shares and Preference Interests and Units Could Adversely Affect Our Performance

General

The Company’s total debt summary, as of December 31, 2004, included:

Debt Summary

	$ Millions *		Weighted Average Rate *
Secured	$	3,167	5.46	%
Unsecured	3,293		5.81	%
Total	$	6,460	5.63	%
Fixed Rate	$	5,071	6.45	%
Floating Rate	1,389		2.51	%
Total	$	6,460	5.63	%
Above Totals Include:
Tax Exempt:
Fixed	$	287	4.30	%
Floating	562		1.79	%
Total	$	849	2.70	%
Unsecured Revolving Credit Facility	$	150	1.73	%

* Net of the effect of any derivative instruments.

In addition to debt, we have $842.4 million of combined liquidation value of outstanding preferred shares of beneficial interest and preference interests and units, with a weighted average dividend preference of 8.23% per annum, as of December 31, 2004.  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.  The Company’s debt maturity schedule as of December 31, 2004 is as follows:

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Debt Maturity Schedule

Year	$ Millions		% of Total
2005(1)(2)	$	818	12.7	%
2006(3)	492		7.6	%
2007	449		7.0	%
2008	627		9.7	%
2009	838		13.0	%
2010	232		3.6	%
2011	718		11.1	%
2012	454		7.0	%
2013	415		6.4	%
2014+	1,417		21.9	%
Total	$	6,460	100.0	%

(1) Includes $300 million of unsecured debt with a final maturity of 2015 that is putable/callable in 2005.

(2) Includes $150 million outstanding on the Company’s unsecured revolving credit facility.

(3) Includes $150 million of unsecured debt with a final maturity of 2026 that is putable in 2006.

Financial Covenants Could Adversely Affect the Company’s Financial Condition

If a property we own is mortgaged to secure payment of indebtedness 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 customary 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 customary restrictions, requirements and other limitations on our ability to incur indebtedness.  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 indebtedness (including acquisition financing), and to sell all or substantially all of our assets.  Our credit facility and indentures are cross-defaulted and also contain cross default provisions with other material indebtedness.  Our unsecured public debt covenants as of December 31, 2004 and 2003, respectively, are (terms are defined in the indentures):

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Unsecured Public Debt Covenants

	As of 12/31/04		As of 12/31/03
Total Debt to Adjusted Total Assets (not to exceed 60%)	42.5	%	39.1	%
Secured Debt to Adjusted Total Assets (not to exceed 40%)	20.8	%	19.6	%
Consolidated Income Available For Debt Service To Maximum Annual Service Charges (must be at least 1.5 to 1)	2.88		2.90
Total Unsecured Assets to Unsecured Debt (must be at least 150%)	278.1	%	330.2	%

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 35% as of December 31, 2004.  We have a policy of incurring indebtedness for borrowed money only through the Operating Partnership and its subsidiaries and only if upon such incurrence our debt to market capitalization ratio would be approximately 50% or less.  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 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 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 expenses under these debt instruments and would increase the costs of refinancing existing indebtedness 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.

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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 Bruce W. Duncan, our President and Chief Executive Officer and Gerald A. Spector, our Chief Operating Officer.  If they resign, our operations could be temporarily adversely affected.  Mr. Zell has entered into executive compensation and retirement benefit agreements with the Company.  Mr. Duncan and Mr. Spector have entered into Deferred Compensation Agreements with the Company that under certain conditions could provide both with a salary benefit after their respective termination of employment with the Company.  In addition, Mr. Zell and Mr. Spector have entered into Noncompetition Agreements with the Company and Mr. Duncan’s Employment Agreement contains covenants not to compete in favor of the Company.

In the event the Chairman of the Board and/or CEO are unable to serve, (i) the Lead Trustee shall automatically be appointed to serve as the interim successor to the Chairman, (ii) the Chairman shall 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

As of December 31, 2004, Samuel Zell, the Chairman of the Board of the Company, and certain of the current holders of OP Units issued to affiliates of Mr. Zell, and our executive officers and trustees, owned some of our common shares.  In addition, the consent of certain affiliates of Mr. Zell is required for certain amendments to the Fifth Amended and Restated Agreement of Limited Partnership of ERP Operating Limited Partnership (the “Partnership Agreement”).  As a result of their security ownership and rights concerning amendments to the Partnership Agreement, the Zell affiliates 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 Mr. Zell and our executive officers and trustees, 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.  See “We Have a Share Ownership Limit for REIT Tax Purposes.”  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, on May 28, 2004 the Company amended the Ownership Limit to require, rather than permit, the Board to grant a waiver of the

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Ownership Limit if the individual seeking a waiver demonstrates that such ownership would not jeopardize the Company’s status as a REIT.

Our Preferred Shares of Beneficial Interest May Affect Changes in Control

Our Declaration of Trust authorizes the Board of Trustees to issue up to 100 million preferred shares of beneficial interest, 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.  As of December 31, 2004, 4,108,658 preferred shares were issued and outstanding.

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 trust’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 the Zell Original Owners and persons acting in concert with any of the Zell Original Owners.  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, at least 95% of our gross income must come from 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

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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.

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 recent 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 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 merger partners failed to qualify as a REIT, an additional concern would be that they would have recognized taxable gain at the time they were 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.

Other Tax Liabilities

Even if we qualify as a REIT, we will be subject to certain federal, state and local taxes on our income and property.  In addition, our third-party management operations, corporate housing business and condominium conversion business, which are conducted through subsidiaries, generally will be subject to federal income tax at regular corporate rates.

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.

Federal Income Tax Considerations

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

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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 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 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 nonqualifying assets (this relief provision is generally applicable only for our taxable years commencing on or after January 1, 2005).  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 (this relief provision is generally applicable only for our taxable years commencing on or after January 1, 2005).  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.

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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 able to continue to operate in a manner so as to remain qualified as a REIT.

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.  First, 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.  Second, 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 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.  Securities for purposes of the asset tests described in (3) above may include debt securities other than those qualifying as "straight debt".  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

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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 might not disagree 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 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.

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.  In certain circumstances, assets owned by us are sold to our TRSs.  In any such sale, the price paid by the TRS to us is determined on an arms length basis and is supported by third party valuation reports.  In enacting the taxable REIT subsidiary rules, Congress intended that the arrangements between a REIT and its taxable REIT subsidiaries be structured to ensure that a taxable REIT subsidiary will be subject to an appropriate level of federal income taxation.  As a result, the Internal Revenue Code imposes certain limits on the ability of a taxable REIT subsidiary to deduct interest payments made to us.  In addition as discussed above, we 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.

Our Management Company and Other Subsidiaries.  A small portion of the cash to be used by the Operating Partnership to fund distributions to us is expected to come from payments of dividends from management companies and other subsidiaries of the Company that have elected TRS status.  These companies pay federal and state income tax at the full applicable corporate rates.  They 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, the cash available for distribution from these management companies by us to shareholders will be reduced accordingly.

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

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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.

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.

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.

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.

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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.

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.

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 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

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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 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.

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Item 2.  The Properties

As of December 31, 2004, the Company, directly or indirectly through investments in title holding entities, owned all or a portion of 939 properties in 32 states and the District of Columbia consisting of 200,149 units.  The Company’s properties are more fully described as follows:

Type	Properties	Units	Average Units	December 31, 2004 Occupancy
Garden	584	154,230	264	93.5	%
Mid/High-Rise	52	14,409	277	90.3	%
Ranch	302	27,709	92	91.6	%
Military Housing	1	3,801	3,801	95.3	%
Total	939	200,149

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 ranch-style properties are defined as single story properties, which do not provide additional amenities for residents other than laundry facilities and cable television access.  The military housing properties are defined as those properties located on military bases.

It is management’s role to monitor compliance with property policies and to provide preventive maintenance of the properties including common areas, facilities and amenities.  The Company has a dedicated training and education department that creates and coordinates training and strategic implementation for the Company’s property management personnel.  The Company believes that, due in part to its emphasis on training and employee quality, the properties historically have had high occupancy rates.

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 (includes development and condominium conversion properties) at December 31, 2004:

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GARDEN-STYLE PROPERTIES

State	Properties	Units	Percentage of Total Units		December 31, 2004 Occupancy
Alabama	4	800	0.40	%	94.0	%
Arizona	42	11,869	5.93		93.0
California	95	24,064	12.02		94.1
Colorado	29	8,433	4.21		92.6
Connecticut	22	2,637	1.32		93.1
Florida	69	20,980	10.48		94.9
Georgia	33	10,495	5.24		93.7
Illinois	7	2,360	1.18		91.3
Maine	5	672	0.34		91.1
Maryland	22	5,203	2.60		92.7
Massachusetts	35	4,829	2.41		93.2
Michigan	6	1,948	0.97		91.3
Minnesota	17	3,819	1.91		88.0
Missouri	6	1,272	0.64		89.8
New Hampshire	1	390	0.19		90.2
New Jersey	2	980	0.49		95.6
New Mexico	2	369	0.18		91.4
New York	1	300	0.15		88.3
North Carolina	29	7,902	3.95		94.2
Oklahoma	8	2,036	1.02		95.1
Oregon	10	3,604	1.80		93.2
Rhode Island	5	778	0.39		93.2
Tennessee	10	3,171	1.58		94.2
Texas	69	21,341	10.66		93.7
Virginia	11	3,774	1.89		93.0
Washington	41	9,518	4.76		94.6
Wisconsin	3	686	0.34		86.5
Total Garden-Style	584	154,230	77.06	%
Average Garden-Style		264			93.5	%

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MID-RISE/HIGH RISE PROPERTIES

State	Properties	Units	Percentage of Total Units		December 31, 2004 Occupancy
California	5	1,622	0.81	%	87.7	%
Colorado	1	339	0.17		90.8
Connecticut	2	407	0.20		92.6
Florida	3	653	0.33		96.2
Georgia	1	322	0.16		98.4
Illinois	2	1,176	0.59		85.3
Massachusetts	13	3,338	1.67		90.5
Minnesota	1	163	0.08		88.3
New Jersey	5	1,366	0.68		93.8
New York	2	497	0.25		98.6
Ohio	1	748	0.37		79.2
Oregon	1	525	0.26		93.1
Texas	3	596	0.30		92.5
Virginia	5	1,660	0.83		92.9
Washington	5	801	0.40		92.5
Washington, D.C	2	196	0.10		26.0
Total Mid-Rise/High-Rise	52	14,409	7.20	%
Average Mid-Rise/High-Rise		277			90.3	%

RANCH-STYLE PROPERTIES

Florida	86	8,112	4.05	%	95.1	%
Georgia	53	4,413	2.20		90.5
Indiana	40	3,877	1.94		91.1
Kentucky	19	1,533	0.77		89.3
Maryland	4	414	0.21		98.2
Michigan	17	1,536	0.77		93.4
Ohio	74	7,022	3.51		89.2
Pennsylvania	5	469	0.23		86.8
South Carolina	2	187	0.09		88.2
Tennessee	2	146	0.07		95.2
Total Ranch-Style	302	27,709	13.84	%
Average Ranch-Style		92			91.6	%

MILITARY HOUSING PROPERTIES

Washington (Ft. Lewis)	1	3,801	1.90	%	95.3	%
Total Military Housing	1	3,801	1.90	%
Average Military Housing		3,801			95.3	%
Total Residential Portfolio	939	200,149	100	%

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The properties currently in various stages of development at December 31, 2004 are included in the following table.

CONSOLIDATED DEVELOPMENT PROJECTS as of December 31, 2004

(Amounts in thousands except for project and unit amounts)

Projects	Location	Units	Total Capital Cost (1)		Total Book Value to Date (1) (2)		Percentage Completed		Percentage Leased		Percentage Occupied		Estimated Completion Date	Estimated Stabilization Date
Projects Under Development
2400 M Street (Sovereign at 2400)	Washington, DC	359	$	111,947	$	63,774	57	%	—		—		1Q 2006	3Q 2007
Union Station	Los Angeles, CA	278	57,222		21,780		38	%	—		—		4Q 2005	4Q 2006
Indian Ridge	Waltham, MA	264	47,032		24,904		53	%	—		—		4Q 2005	4Q 2006
1111 25th Street (Sovereign House) (3)	Washington, DC	141	40,329		38,425		95	%	—		—		1Q 2005	4Q 2005
Bella Vista III (4)	Woodland Hills, CA	264	70,179		20,293		3	%	—		—		3Q 2006	2Q 2007
Total Projects Under Development (6)		1,306	326,709		169,176
Completed Not Stabilized
1210 Massachusetts Ave. (Sovereign Park)	Washington, DC	144	39,702		39,365		100	%	31	%	26	%	Completed	4Q 2005
Water Terrace I (Regatta I) (4) (5)	Marina Del Rey, CA	450	226,175		226,175		100	%	77	%	74	%	Completed	3Q 2005
Bella Vista I&II (Warner Ridge) (4)	Woodland Hills, CA	315	80,112		77,186		100	%	90	%	90	%	Completed	1Q 2005
City View at the Highlands (4)	Lombard, IL	403	65,539		65,279		100	%	74	%	74	%	Completed	2Q 2005
City Place (Westport) (4)	Kansas City, MO	288	33,760		33,760		100	%	73	%	72	%	Completed	3Q 2005
Marina Bay II (4)	Quincy, MA	108	23,480		23,230		100	%	56	%	56	%	Completed	3Q 2005
Total Projects Completed Not Stabilized		1,708	468,768		464,995
Completed And Stabilized During the Fourth Quarter
Legacy Park Central	Concord, CA	259	52,337		51,035		100	%	98	%	96	%	Completed	4Q 2004
Total Projects Completed And Stabilized During the Fourth Quarter		259	52,337		51,035
Total Projects	12	3,273	$	847,814	$	685,206

(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 completed projects.  Total capital cost and total book value to date exclude purchase consideration paid to the development partner of $1.8 million and $1.0 million on Water Terrace I and Bella Vista I & II, respectively.

(2)  Of the total book value to date, $516.0 million has been transferred to land and depreciable property and $169.2 million is currently reflected as construction in progress (“CIP”). The remaining $148.7 million of CIP represents land held for future development and related costs.  Of the $162.6 million remaining to be invested, $107.6 million will be funded through third party construction mortgages.

(3) Project will be converted to condominiums.

(4) Projects are wholly owned.  All others are partially owned.

(5) Project sold on January 31, 2005.

(6) Projects and units excluded from total Company property and unit count.

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Item 3.  Legal Proceedings

In August 2004, the Company tried a class action lawsuit in Palm Beach County, Florida regarding certain charges made to residents who terminated their leases early or failed to provide sufficient notice of intent to vacate.  In December 2004, the Court issued a Findings of Fact and Conclusions of Law holding those fees legally uncollectible under Florida law. In recognition of the Findings of Fact and Conclusions of Law, which awarded damages and interest to the class in the amount of approximately $1.6 million, the Company established a reserve of approximately $1.6 million and correspondingly recorded this as a general and administrative expense. Due to pending appeals, the award is neither final nor enforceable.  Accordingly, it is not possible to determine or predict the ultimate outcome of the case.  While no assurances can be given, the Company does not believe that this lawsuit, if the ultimate outcome is unfavorable, will have a material adverse effect on the Company.

The Company does not believe there is any other litigation pending or threatened against the Company which, 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.

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PART II

Item 5.Market for Registrant’s Common Equity, Related Shareholder 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
2004
Fourth Quarter Ended December 31, 2004	$	36.75	$	30.86	$	36.18	$	0.4325
Third Quarter Ended September 30, 2004	$	33.21	$	28.74	$	31.00	$	0.4325
Second Quarter Ended June 30, 2004	$	31.11	$	26.65	$	29.73	$	0.4325
First Quarter Ended March 31, 2004	$	31.10	$	28.31	$	29.85	$	0.4325

	Sales Price
	High		Low		Closing		Distributions
2003
Fourth Quarter Ended December 31, 2003	$	30.30	$	28.03	$	29.51	$	0.4325
Third Quarter Ended September 30, 2003	$	29.79	$	25.69	$	29.28	$	0.4325
Second Quarter Ended June 30, 2003	$	27.95	$	24.05	$	25.95	$	0.4325
First Quarter Ended March 31, 2003	$	25.99	$	23.12	$	24.07	$	0.4325

The number of beneficial holders of Common Shares at February 3, 2005, was approximately 47,000.  The number of outstanding Common Shares as of February 3, 2005 was 286,055,990.

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.

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CONSOLIDATED HISTORICAL FINANCIAL INFORMATION

(Financial information in thousands except for per share and property data)

	Year Ended December 31,
	2004			2003			2002			2001			2000
OPERATING DATA:
Total revenues from continuing operations	$	1,889,501		$	1,706,020		$	1,687,041		$	1,715,440		$	1,607,243
Income from continuing operations	$	135,276		$	157,867		$	188,114		$	242,238		$	207,800
Net income	$	472,329		$	523,311		$	400,777		$	455,408		$	538,365
Net income available to Common Shares	$	418,583		$	426,639		$	324,162		$	362,580		$	437,510
Earnings per share – basic:
Income from continuing operations available to CommonShares	$	0.38		$	0.33		$	0.47		$	0.62		$	0.52
Net income available to Common Shares	$	1.50		$	1.57		$	1.19		$	1.36		$	1.69
Weighted average Common Shares outstanding	279,744			272,337			271,974			267,349			259,015
Earnings per share – diluted:
Income from continuing operations available to CommonShares	$	0.37		$	0.32		$	0.46		$	0.61		$	0.52
Net income available to Common Shares	$	1.48		$	1.55		$	1.18		$	1.34		$	1.67
Weighted average Common Shares outstanding	303,871			297,041			297,969			295,213			286,503
Distributions declared per Common Share outstanding	$	1.73		$	1.73		$	1.73		$	1.68		$	1.575
BALANCE SHEET DATA (at end of period):
Real estate, before accumulated depreciation	$	14,852,621		$	12,874,379		$	13,046,263		$	13,016,183		$	12,591,539
Real estate, after accumulated depreciation	$	12,252,794		$	10,578,366		$	10,934,246		$	11,297,338		$	11,239,303
Total assets	$	12,645,275		$	11,466,893		$	11,810,917		$	12,235,625		$	12,263,966
Total debt	$	6,459,806		$	5,360,489		$	5,523,699		$	5,742,758		$	5,706,152
Minority Interests	$	535,582		$	600,929		$	611,303		$	635,822		$	612,618
Shareholders’ equity	$	5,072,528		$	5,015,441		$	5,197,123		$	5,413,950		$	5,619,547
OTHER DATA:
Total properties (at end of period)	939			968			1,039			1,076			1,104
Total apartment units (at end of period)	200,149			207,506			223,591			224,801			227,704
Funds from operations available to Common Shares and OP Units (1)(2)	$	651,741		$	640,390		$	719,265		$	706,294		$	719,580
Cash flow provided by (used for):
Operating activities	$	717,750		$	744,319		$	888,263		$	889,668		$	836,417
Investing activities	$	(565,968	)	$	334,028		$	(48,622	)	$	57,429		$	(557,766	)
Financing activities	$	(117,856	)	$	(1,058,643	)	$	(861,369	)	$	(919,266	)	$	(283,996	)

(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, because it is a recognized measure of performance by the real estate industry and by excluding gains or losses related

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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 Unconsolidated Properties 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, 2004.

Forward-looking statements in this Item 7 as well as Item 1 of 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.  The words “believes”, “estimates”, “expects” and “anticipates” and other similar expressions that are predictions of or indicate future events and trends and which do not relate solely to historical matters identify forward-looking statements.  Such forward-looking statements are subject to risks and uncertainties, 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.  Factors that might cause such differences include, but are not limited to, the following:

•The total number of development units, cost of development and completion dates as well as anticipated capital expenditures for replacements and building improvements all reflect the Company’s best estimates and 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; 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 Note 5 and 11 to the Notes to Consolidated Financial Statements in this report.

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Results of Operations

The following table summarizes the number of properties and related units for the periods presented:

	Properties		Units		Purchase / Sale Price $Millions
At December 31, 2002	1,039		223,591
2003 Acquisitions	17		5,200		$	684.1
2003 Dispositions:
Rental Properties	(95	)	(23,075	)	$	(1,162.6	)
Condominium Units	(1	)	(411	)	$	(54.8	)
Vacant Land	—		—		$	(0.6	)
2003 Completed Developments	8		2,112
2003 Unit Configuration Changes	—		89
At December 31, 2003	968		207,506
2004 Acquisitions:
Rental Properties	24		6,182		$	900.8
Vacant Land	—		—		$	12.4
2004 Dispositions:
Rental Properties	(56	)	(14,159	)	$	(787.8	)
Condominium Units	(2	)	(977	)	$	(177.3	)
Vacant Land	—		—		$	(27.9	)
2004 Completed Developments	5		1,565
2004Unit Configuration Changes	—		32
At December 31, 2004	939		200,149

The Company’s primary financial measure for evaluating each of its apartment communities is net operating income (“NOI”).  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 2004 and 2003 (the “2004 Same Store Properties”), which represented 162,201 units, impacted the Company’s results of operations.  Properties that the Company owned for all of both 2003 and 2002 (the “2003 Same Store Properties”), which represented 171,841 units, also impacted the Company’s results of operations.  Both the 2004 Same Store Properties and 2003 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, 2004 and 2003.  The impacts of these activities are also discussed in greater detail in the following paragraphs.

Comparison of the year ended December 31, 2004 to the year ended December 31, 2003

For the year ended December 31, 2004, income from continuing operations decreased by approximately $22.6 million when compared to the year ended December 31, 2003.  During the year ended December 31, 2004, the Company established a reserve and recorded a corresponding expense of $15.2 million in estimated uninsured property damage at certain of its properties primarily located in Florida caused by Hurricanes Charley, Frances, Ivan and Jeanne.  Of this amount, approximately $9.4 million had been spent for hurricane related repairs through December 31, 2004.

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Revenues from the 2004 Same Store Properties increased $14.1 million primarily as a result of lower concessions provided residents and a slight increase in occupancy rates.  Expenses from the 2004 Same Store Properties increased $22.5 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 2004 Same Store Properties:

2004 vs. 2003 Year over Year Same-Store Results
$ in Millions – 162,201 Same-Store Units
Description	Revenues			Expenses (1)			NOI
2004	$	1,613.5		$	653.5		$	960.0
2003	$	1,599.4		$	631.0		$	968.4
Change	$	14.1		$	22.5		$	(8.4	)
Change	0.9		%	3.6		%	(0.9%		)

(1)December 2004 expenses exclude the uninsured property damage caused by Hurricanes Charley, Frances, Ivan & Jeanne.

Same-Store Occupancy Statistics

Year 2004	93.3%
Year 2003	93.0%
Change	0.3%

The following table presents a reconciliation of operating income per the consolidated statements of operations to NOI for the 2004 Same Store Properties.

	Year Ended December 31,
	2004			2003
	(Amounts in millions)
Operating income	$	526.7		$	530.3
Adjustments:
Insurance (hurricane property damage)	15.2			—
Non-same store operating results	(114.7		)	(10.3		)
Fee and asset management revenue	(11.2		)	(14.4		)
Fee and asset management expense	8.6			7.8
Depreciation	484.2			415.0
General and administrative	51.2			38.8
Impairment on technology investments	—			1.2
Same store NOI	$	960.0		$	968.4

For properties that the Company acquired prior to January 1, 2004 and expects to continue to own through December 31, 2005, the Company anticipates the following same store results for the full year ending December 31, 2005:

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2005 Same-Store Assumptions

Physical Occupancy	94.0%
Revenue Change	2.00% to 3.25%
Expense Change	3.6% to 5.0%
NOI Change	0.0% to 3.0%

These 2005 assumptions are based on current expectations and are forward-looking.

Rental income from properties other than 2004 Same Store Properties increased by approximately $172.6 million primarily as a result of revenue from newly acquired properties not yet included as 2004 Same Store Properties and the consolidation of all previously unconsolidated development projects.

Fee and asset management revenues, net of fee and asset management expenses, decreased by $3.9 million primarily as a result of lower income earned from Ft. Lewis and managing fewer properties for third parties and unconsolidated entities.  As of December 31, 2004 and 2003, the Company managed 17,988 units and 18,475 units, respectively, for third parties and unconsolidated entities.

Property management expenses 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 $7.8 million or 11.5%.  This increase is primarily attributable to higher payroll costs, including bonuses and long-term compensation costs as well as severance costs for certain employees.  In addition, the property management company experienced slightly higher costs for travel, temporary help, internal conferences and legal and professional fees.

Depreciation expense, which includes depreciation on non-real estate assets, increased $69.2 million primarily as a result of the consolidation of previously unconsolidated projects and properties acquired after December 31, 2003, many of which had significantly higher per unit acquisition costs than properties previously acquired, and also due to additional depreciation on capital expenditures for all properties owned.

General and administrative expenses, which include corporate operating expenses, increased approximately $12.4 million or 32.0% between the periods under comparison.  This increase was primarily due to the costs of consulting services rendered to increase operating efficiencies and increased litigation and internal control costs.  This increase was partially offset by $1.4 million of immediate expense recognition related to options granted in the first quarter of 2003 to the Company’s former chief executive officer.   Consulting services were contracted to enhance resident satisfaction/retention, unit pricing and expense procurement/reduction.  The Company believes that these additional expenditures may be more than offset by increased rental revenues and/or reduced operating expenses in future years.  The Company also anticipates that general and administrative expenses will approximate $43.0 million for the year ended December 31, 2005.  The above assumptions are based on current expectations and are forward-looking.

The Company recorded impairment charges on its technology investments of approximately $1.2 million for the year ended December 31, 2003.  See Note 19 in the Notes to Consolidated Financial Statements for further discussion.

Interest and other income decreased approximately $5.5 million, primarily as a result of lower balances available for investments including deposits in tax deferred exchange accounts and collateral agreements related to development projects.

Interest expense, including amortization of deferred financing costs, increased approximately $20.8 million.  This increase was primarily attributable to increases in mortgage and unsecured note balances and lower capitalized interest.  During the year ended December 31, 2004, the Company capitalized interest costs of approximately $14.0 million as compared to $20.6 million for the year ended December 31, 2003.  This capitalization of interest primarily related to equity investments in Partially Owned Properties (consolidated)

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engaged in development activities.  The effective interest cost on all indebtedness for the year ended December 31, 2004 was 5.87% as compared to 6.36% for the year ended December 31, 2003.

Loss from investments in unconsolidated entities decreased approximately $2.8 million between the periods under comparison.  This decrease is primarily the result of consolidation of properties that were previously unconsolidated, partially offset by an increase in realized losses on the settlement of derivative instruments.

Net gain on sales of discontinued operations increased approximately $13.2 million between the periods under comparison.  This increase is primarily the result of an increase in the number of condominium units sold.

Discontinued operations, net, decreased approximately $41.6 million between the periods under comparison.  See Note 13 in the Notes to Consolidated Financial Statements for further discussion.

Comparison of the year ended December 31, 2003 to the year ended December 31, 2002

For the year ended December 31, 2003, income from continuing operations decreased by approximately $30.2 million when compared to the year ended December 31, 2002.  This decrease was primarily attributable to increased operating expenses incurred including property management costs and depreciation.

Revenues from the 2003 Same Store Properties decreased by $38.2 million primarily as a result of lower overall physical occupancy, increased concessions and lower rental rates charged to both new and renewal residents.  Property operating expenses from the 2003 Same Store Properties increased by $36.3 million primarily due to higher payroll, maintenance, utility, real estate taxes, insurance, leasing and advertising and building costs.  The following tables provide comparative revenue, expense, NOI and weighted average occupancy for the 2003 Same Store Properties:

2003 vs. 2002
Year over Year Same-Store Results

$in Millions – 171,841 Same-Store Units

Description	Revenues			Expenses			NOI
2003	$	1,650.8		$	659.0		$	991.8
2002	$	1,689.0		$	622.7		$	1,066.3
Change	$	(38.2	)	$	36.3		$	(74.5	)
Change	(2.3%		)	5.8		%	(7.0%		)

Same-Store Occupancy Statistics

Year 2003	93.0%
Year 2002	93.7%
Change	(0.7%)

Rental income from properties other than 2003 Same Store Properties increased by approximately $47.5 million primarily as a result of revenue from newly acquired properties not yet included as 2003 Same Store Properties and additional Partially Owned Properties consolidated in the fourth quarter of 2002 and during the year ended December 31, 2003.

Fee and asset management revenues, net of fee and asset management expenses, increased by $4.9 million primarily as a result of additional income allocated from Ft. Lewis.  As of December 31, 2003 and

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2002, the Company managed 18,475 units and 18,965 units, respectively, for third parties and unconsolidated entities.

Property management expenses 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 decreased by approximately $4.4 million or 6.0%.  This decrease is primarily attributable to a reversal of a profit sharing accrual in the first quarter of 2003 related to the 2002 calendar year as the Company didn’t achieve its stated goals and management elected not to make a discretionary contribution to the plan.  In addition, the Company recorded lower expense in connection with granting less restricted shares and reducing the expense associated with the Company’s matched funding of its 401(k) plan during 2003 and not incurring an expense for 2003 discretionary profit sharing contributions.

Depreciation expense, which includes depreciation on non-real estate assets, increased $25.4 million primarily as a result of properties acquired after December 31, 2002, many of which had significantly higher per unit acquisition costs than properties previously acquired, and additional depreciation on capital expenditures for all properties owned.

General and administrative expenses, which include corporate operating expenses, decreased approximately $7.7 million between the periods under comparison.  This decrease was primarily due to lower expenses recorded in connection with granting less restricted shares to employees during 2003, partially offset by approximately a $2.6 million increase related to the Company’s decision to begin to expense its stock based compensation in accordance with SFAS No. 123 and its amendment (SFAS No. 148).  In addition, lower state income and franchise taxes also contributed to this decrease.

The Company recorded impairment charges on its technology investments and its corporate housing business of approximately $1.2 million and $18.3 million for the years ended December 31, 2003 and 2002, respectively.  See Note 19 in the Notes to Consolidated Financial Statements for further discussion.

Interest and other income increased by approximately $1.4 million, primarily as a result of higher cash balances available for short-term investments throughout 2003.

Interest expense, including amortization of deferred financing costs, decreased approximately $4.6 million primarily due to lower variable interest rates and lower overall levels of debt.  During the year ended December 31, 2003, the Company capitalized interest costs of approximately $20.6 million as compared to $27.2 million for the year ended December 31, 2002.  This capitalization of interest primarily related to equity investments in unconsolidated entities engaged in development activities.  The effective interest cost on all indebtedness for the year ended December 31, 2003 was 6.36% as compared to 6.54% for the year ended December 31, 2002.

Loss from investments in unconsolidated entities increased approximately $6.4 million between the periods under comparison.  This increase is primarily the result of increased operating losses from equity investments partially offset by unrealized gains on derivative instruments.

Net gain on sales of discontinued operations increased approximately $206.4 million between the periods under comparison.  This increase is primarily the result of a greater number of properties sold during the year ended December 31, 2003, as well as the fact that several properties had lower net carrying values at sale.

Discontinued operations, net, decreased approximately $53.6 million between the periods under comparison.  See Note 13 in the Notes to Consolidated Financial Statements for further discussion.

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Liquidity and Capital Resources

For the Year Ended December 31, 2004

As of January 1, 2004, the Company had approximately $49.6 million of cash and cash equivalents and $633.3 million available under its line of credit (net of $56.7 million which was restricted/dedicated to 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, 2004 was approximately $83.5 million and the amount available on the Company’s line of credit was $484.6 million (net of $65.4 million which was restricted/dedicated to support letters of credit and not available for borrowing).

During the year ended December 31, 2004, the Company generated proceeds from various transactions, which included the following:

•Disposed of fifty-eight properties (including four Unconsolidated Properties and various individual condominium units) and received net proceeds of approximately $945.6 million;

•Issued $300.0 million of 4.75% fixed rate unsecured debt receiving net proceeds of $296.8 million;

•Issued $500.0 million of 5.25% fixed rate unsecured debt receiving net proceeds of $496.1 million;

•Obtained $100.0 million from an unsecured floating rate loan;

•Obtained $467.5 million in new mortgage financing; and

•Issued approximately 3.6million Common Shares and received net proceeds of $85.9 million.

During the year ended December 31, 2004, the above proceeds were primarily utilized to:

•Acquire twenty-four properties including a vacant land parcel, and four additional units at two existing properties, utilizing cash of $820.0 million;

•Repay $494.9 million of mortgage loans;

•Repay $535.7 million of unsecured notes;

•Redeem the Series A Preference Interests at a liquidation value of $40.0 million;

•Invest $406.5 million primarily in previously unconsolidated development projects prior to their consolidation (inclusive of $339.7 million in mortgage debt paid off prior to consolidation); and

•Acquire the minority interests in fifteen previously unconsolidated development properties, two vacant land parcels and four other properties for $53.4 million in cash (prior to consideration of cash acquired of $4.2 million).

Depending on its analysis of market prices, economic conditions, and other opportunities for the investment of available capital, the Company may repurchase up to an additional $85.0 million of its Common Shares pursuant to its existing share buyback program authorized by the Board of Trustees.  The Company did not repurchase any of its Common Shares during the year ended December 31, 2004.

The Company’s total debt summary and debt maturity schedule as of December 31, 2004, are as follows:

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Debt Summary
	$ Millions *		Weighted Average Rate *
Secured	$	3,167	5.46	%
Unsecured	3,293		5.81	%
Total	$	6,460	5.63	%
Fixed Rate	$	5,071	6.45	%
Floating Rate	1,389		2.51	%
Total	$	6,460	5.63	%
Above Totals Include:
Tax Exempt
Fixed	$	287	4.30	%
Floating	562		1.79	%
Total	$	849	2.70	%
Unsecured Revolving Credit Facility	$	150	1.73	%

* Net of the effect of any derivative instruments.

Debt Maturity Schedule

Year	$ Millions		% of Total
2005 (1)(2)	$	818	12.7	%
2006 (3)	492		7.6	%
2007	449		7.0	%
2008	627		9.7	%
2009	838		13.0	%
2010	232		3.6	%
2011	718		11.1	%
2012	454		7.0	%
2013	415		6.4	%
2014+	1,417		21.9	%
Total	$	6,460	100.0	%

(1) Includes $300 million of unsecured debt with a final maturity of 2015 that is putable/callable in 2005.

(2) Includes $150 million outstanding on the Company’s unsecured revolving credit facility.

(3) Includes $150 million of unsecured debt with a final maturity of 2026 that is putable in 2006.

In June 2003, the Operating Partnership filed and the SEC declared effective a Form S-3 registration statement to register $2.0 billion of debt securities.  In addition, the Operating Partnership carried over $280.0 million related to a prior registration statement.  As of February 2, 2005, $1.48 billion in debt securities remained available for issuance under this registration statement.

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 2, 2005, $956.5 million in equity securities

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remained available for issuance under this registration statement.

The Company’s “Consolidated Debt-to-Total Market Capitalization Ratio” as of December 31, 2004 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 and preference interests outstanding.

Capitalization as of December 31, 2004
Total Debt			$	6,459,806,228
Common Shares & OP Units	305,629,855
Common Share Equivalents (see below)	1,968,453
Total Outstanding at year-end	307,598,308
Common Share Price at December 31, 2004	$	36.18
			11,128,906,783
Perpetual Preferred Shares Liquidation Value			615,000,000
Perpetual Preference Interests Liquidation Value			171,500,000
Total Market Capitalization			$	18,375,213,011
Total Debt/Total Market Capitalization			35		%

Convertible Preferred Shares, Preference Interests and Junior Preference Units as of December 31, 2004
	Shares/Units	Conversion Ratio	Common Share Equivalents
Preferred Shares:
Series E	811,724	1.1128	903,286
Series H	36,934	1.4480	53,480
Preference Interests:
Series H	190,000	1.5108	287,052
Series I	270,000	1.4542	392,634
Series J	230,000	1.4108	324,484
Junior Preference Units:
Series B	7,367	1.020408	7,517
Total			1,968,453

The Company’s policy is to maintain a ratio of consolidated debt-to-total market capitalization of less than 50%.

From January 1, 2005 through February 7, 2005, the Company:

•Acquired four properties consisting of 734 units and one parcel of vacant land for approximately $144.1 million;

•Disposed of one property consisting of 450 units and a vacant land parcel (excluding condominium units) for approximately $340.9 million;

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•Assumed $47.6 million of mortgage debt on two properties in connection with their acquisitions;

•Executed an amended compensation agreement with its Chairman of the Board of Trustees extending his current agreement on the same terms and conditions for two more years through 2006 and providing him with a $3.25 million per year long-term compensation grant of options and restricted shares; and

•Issued irrevocable notices to redeem for cash during March 2005 all 1,320,000 units of its 8.50% Series B and C Preference Interests with a cumulative liquidation value of $66.0 million.

On February 24, 2005, the Company received $57.1 million in cash for its ownership interest in Rent.com in connection with the acquisition of Rent.com by eBay, Inc.

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:

•carpets and hardwood floors;

•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;

•flooring such as vinyl, linoleum or tile; and

•blinds/shades.

All replacements are depreciated over a five-year estimated useful life.  We expense as incurred all 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 expense as incurred all recurring expenditures that do not improve the value of the asset or extend its useful life.

For the year ended December 31, 2004, our actual improvements to real estate totaled approximately $212.2 million.  This includes the following detail (amounts in thousands except for unit and per unit amounts):

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Capitalized Improvements to Real Estate For the Year Ended December 31, 2004
	Total Units (1)	Replacements		Avg. Per Unit		Building Improvements		Avg. Per Unit		Total		Avg. Per Unit
Established Properties (2)	153,442	$	57,300	$	373	$	95,715	$	624	$	153,015	$	997
New Acquisition Properties (3)	21,762	4,026		229		10,127		576		14,153		805
Other (4)	8,727	17,868				27,135				45,003
Total	183,931	$	79,194			$	132,977			$	212,171

(1)Total units exclude 16,218 unconsolidated units.

(2)Wholly Owned Properties acquired prior to January 1, 2002.

(3)Wholly Owned Properties acquired during 2002, 2003 and 2004.  Per unit amounts are based on a weighted average of 17,577 units.

(4)Includes properties either Partially Owned or sold during the period, commercial space, condominium conversions and $6.6 million included in building improvements spent on fifteen specific assets related to major renovations and repositioning of these assets.

For the year ended December 31, 2003, our actual improvements to real estate totaled approximately $181.9 million.  This includes the following detail (amounts in thousands except for unit and per unit amounts):

Capitalized Improvements to Real Estate For the Year Ended December 31, 2003
	Total Units (1)	Replacements		Avg. Per Unit		Building Improvements		Avg. Per Unit		Total		Avg. Per Unit
Established Properties (2)	162,477	$	57,931	$	356	$	77,607	$	478	$	135,538	$	834
New Acquisition Properties (3)	14,457	2,653		252		5,250		498		7,903		750
Other (4)	7,994	13,417				25,090				38,507
Total	184,928	$	74,001			$	107,947			$	181,948

(1)Total units exclude 22,578 unconsolidated units.

(2)Wholly Owned Properties acquired prior to January 1, 2001.

(3)Wholly Owned Properties acquired during 2001, 2002 and 2003.  Per unit amounts are based on a weighted average of 10,533 units.

(4)Includes properties either Partially Owned or sold during the period, commercial space, condominium conversions and $6.5 million included in building improvements spent on seven specific assets related to major renovations and repositioning of these assets.

The Company expects to fund approximately $160.0 million for capital expenditures for replacements and building improvements for all consolidated properties, exclusive of condominium conversion properties, in 2005.

During the year ended December 31, 2004, 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, was approximately $6.6 million.  The

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Company expects to fund approximately $12.8 million in total additions to non-real estate property in 2005.

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 11in the Notes to Consolidated Financial Statements for additional discussion of derivative instruments at December 31, 2004.

Other

Minority Interests as of December 31, 2004 decreased by $65.3 million when compared to December 31, 2003.  The primary factors that impacted this account in the Company’s consolidated statements of operations and balance sheets during the year ended December 31, 2004 were:

•Distributions declared to Minority Interests, which amounted to $35.9 million (excluding Junior Preference Unit and Preference Interest distributions);

•The allocation of income from operations to holders of OP Units in the amount of $31.2 million;

•The issuance of 306,694 OP Units to various limited partners at an average price of $29.63 per unit;

•The redemption of 800,000 Series A Cumulative Redeemable Preference Interests with a liquidation value of $40.0 million and a premium on redemption of $1.1 million (see Note 3 in the Notes to Consolidated Financial Statements for further discussion);

•The issuance of Common Shares; and

•The conversion of 1.7 million OP Units into Common Shares valued at $36.9 million at an average price of $21.16 per unit.

Total distributions paid in January 2005 amounted to $144.1 million (excluding distributions on Partially Owned Properties), which included certain distributions declared during the fourth quarter ended December 31, 2004.

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 under its line of credit.  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

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under its unsecured notes and line of credit.  Of the $14.9 billion in investment in real estate on the Company’s balance sheet at December 31, 2004, $9.5 billion or 63.8%, was unencumbered.

The Operating Partnership has a revolving credit facility with potential borrowings of up to $700.0 million.    This facility matures in May 2005 and may, among other potential uses, be used to fund property acquisitions, costs for certain properties under development and short term liquidity requirements.  As of March 1, 2005, $135.0million was outstanding under this facility (and $51.0 million was restricted and dedicated to support letters of credit).

The Operating Partnership is currently negotiating a new credit facility to replace or expand its existing facility and fully expects to obtain this at current or improved terms in March or April 2005.

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.  The nature and business purpose of these ventures are as follows:

•Institutional Ventures – During 2000 and 2001, the Company entered into 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.

•Lexford/Other – As of December 31, 2004, the Company has ownership interests in twelve properties containing 1,571 units acquired in a prior merger.  The current weighted average ownership percentage is 11.0%.  The Company’s strategy with respect to these interests is either to acquire a majority ownership or sell the Company’s interest.

As of December 31, 2004, the Company has five projects totaling 1,306 units in various stages of development with estimated completion dates ranging through September 30, 2006.  The three 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 subject to the agreement, 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.   In connection with this development partner, the Company has an obligation to provide up to $40.0 million in credit enhancements to guarantee a portion of the third party construction financing.  As of February 2, 2005, the Company had set-aside $5.0 million towards this credit enhancement.  The Company would be required to perform under this agreement only if there was a material default under a third party construction mortgage agreement.  This agreement expires no later than December 31, 2018.  Notwithstanding the termination of the agreement, the Company shall have recourse against its development partner for any losses incurred.

•The second development partner has the right, at any time following completion of a project subject to the agreement, to require the Company to purchase the partners’ 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

45

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.

See Note 6 in the Notes to Consolidated Financial Statements for additional discussion regarding the Company’s investments in unconsolidated entities.

In connection with one of its mergers, the Company provided a guaranty of a credit enhancement agreement with respect to certain tax-exempt bonds issued to finance certain public improvements at a multifamily development project.  The Company has the obligation to provide this guaranty for a period of eight years from the consummation of the merger or through May 2005.  The Company would be required to perform under this guaranty only if there was a draw on the letter of credit issued by the credit enhancement party.  The counterparty has also indemnified the Company for any losses suffered.  As of February 2, 2005, this guaranty was still in effect at a commitment amount of $10.4 million and no current outstanding liability.

The following table summarizes the Company’s contractual obligations for the next five years and thereafter as of December 31, 2004:

	Payments Due by Year (in thousands)
Contractual Obligations	2005		2006		2007		2008		2009		Thereafter		Total
Debt (a)	$	817,897	$	491,617	$	449,090	$	626,939	$	838,015	$	3,236,248	$	6,459,806
Operating Leases:
Minimum Rent Payments (b)	4,816		4,205		3,464		3,335		3,233		7,369		26,422
Other Long-Term Liabilities:
Deferred Compensation (c)	813		1,807		2,211		2,211		2,211		11,230		20,483
Other (d)	1,000		—		—		—		—		—		1,000
Total	$	824,526	$	497,629	$	454,765	$	632,485	$	843,459	$	3,254,847	$	6,507,711

(a)   Amounts include aggregate principal payments only.  The Company paid $348,574, $352,391 and $365,782 for interest on debt, inclusive of derivative instruments, for the years ended December 31, 2004, 2003 and 2002, 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, former CEO and two other executive officers based on planned retirement dates.

(d)   Promissory note due on one property, repaid in January 2005.

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

46

for the year ended December 31, 2004.

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 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, through the date the certificates of occupancy ("CO") are issued (CO's are deemed final within 90 days of issuance), 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.  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 rennovation 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 other factors relevant to the financial instruments.

47

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.

Stock-Based Compensation

Prior to 2003, the Company had chosen to account for its stock-based compensation in accordance with APB No. 25, Accounting for Stock Issued to Employees,which resulted in no compensation expense for options issued with an exercise price equal to or exceeding the market value of the Company’s Common Shares on the date of grant (intrinsic method).  The Company elected to account for its stock-based compensation in accordance with SFAS No. 123 and its amendment (SFAS No. 148), Accounting for Stock Based Compensation, effective in the first quarter of 2003, which resulted in compensation expense being recorded based on the fair value of the stock compensation granted.

SFAS No. 148 provides three transition methods for entities that adopt the fair value recognition provisions of SFAS No. 123.  The Company elected the “Prospective Method” which requires expensing of employee awards granted or modified after January 1, 2003.  Compensation expense under all of the Company’s plans is generally recognized over periods ranging from three months to five years.  See Note 2 in the Notes to Consolidated Financial Statements for further discussion and comparative information regarding application of the fair value method to all outstanding employee awards.

Funds From Operations

For the year ended December 31, 2004, Funds From Operations (“FFO”) available to Common Shares and OP Units increased $11.4 million, or 1.8%, as compared to the year ended December 31, 2003. For the year ended December 31, 2003, FFO available to Common Shares and OP Units decreased $78.9 million, or 11.0%, as compared to the year ended December 31, 2002.

The following is a reconciliation of net income to FFO available to Common Shares and OP Units for the years ended December 31, 2004, 2003 and 2002:

48

Funds From Operations

(Amounts in thousands)

	Year Ended December 31,
	2004			2003			2002
Net income	$	472,329		$	523,311		$	400,777
Net income allocation to Minority Interests – Operating Partnership	31,228			34,658			26,862
Adjustments:
Depreciation	484,209			414,998			389,580
Depreciation – Non-real estate additions	(5,574		)	(7,019		)	(9,213		)
Depreciation – Partially Owned Properties	(8,256		)	(8,390		)	(7,706		)
Depreciation – Unconsolidated Properties	10,159			28,301			19,872
Net (gain) on sales of unconsolidated entities	(4,593		)	(4,942		)	(5,054		)
Discontinued Operations:
Depreciation	12,374			56,571			83,376
Net (gain) on sales of discontinued operations	(323,925		)	(310,706		)	(104,296		)
Net incremental gain on sales of condominium units	32,054			10,280			1,682
Net gain on sales of vacant land	5,482			—			—
FFO (1)(2)	705,487			737,062			795,880
Preferred distributions	(53,746		)	(76,435		)	(76,615		)
Premium on redemption of Preferred Shares	—			(20,237		)	—
FFO available to Common Shares and OP Units	$	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 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.

49

Item 7A.  Quantitative and Qualitative Disclosure about Market Risk

Market risks relating to the Company’s operations 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 line of credit.  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, line 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 approximates their carrying value at December 31, 2004.

The Company had total outstanding floating rate debt of approximately $1,389.0 million, or 21.5% of total debt at December 31, 2004, net of the effects of any derivative instruments.  If market rates of interest on all of the floating rate debt permanently increased by 25 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 $3.5million.  If market rates of interest on all of the floating rate debt permanently decreased by 25 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 $3.5million.

At December 31, 2004, the Company had total outstanding fixed rate debt of approximately $5.1 billion, net of the effects of any derivative instruments.  If market rates of interest permanently increased by 65 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 $4.6 billion.  If market rates of interest permanently decreased by 65 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 $5.6 billion.

At December 31, 2004, the Company’s derivative instruments had a net liability fair value of approximately $7.9 million.  If market rates of interest permanently increased by 40 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 $13.9 million.  If market rates of interest permanently decreased by 40 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 $2.2 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

50

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, 2004, 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 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 in timely alerting them to material information.  During the fiscal year ended December 31, 2004, there were no changes to the internal controls over financial reporting of the Company identified in connection with the Company’s evaluation or otherwise that has materially affected, or is reasonably likely to materially affect, the Company’s internal controls over financial reporting.

(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 Rules 13a-15(f) under the Securities Exchange Act of 1934.  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, 2004.  Management’s assessment of the effectiveness of internal control over financial reporting as of December 31, 2004 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.

Item 9B.   Other Information

None.

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PART III

Items 10, 11, 12, 13 and 14.

Trustees and Executive Officers of the Registrant, Executive Compensation, Security Ownership of Certain Beneficial Owners and Management, Certain Relationships and Related Transactions and Principal Accountant 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 15, 2005, and thus these items have been omitted in accordance with General Instruction G(3) to Form 10-K.

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PART IV

Item 15.  Exhibits and Financial Statement Schedules.

(a)

(1) See Index to Financial Statements and Schedules on page F-1 of this Form 10-K.

(2 & 3) See Items (b) and (c) below.

(b)  Exhibits:

3.1	Articles of Restatement of Declaration of Trust of Equity Residential dated December 9, 2004.
3.2+	Fifth Amended and Restated Bylaws of Equity Residential dated December 9, 2004.
4.1*	Indenture, dated October 1, 1994, between the Operating Partnership, as obligor and The First National Bank of Chicago, as trustee (“Indenture”).
4.2**	First Supplemental Indenture to Indenture, dated as of September 9, 2004.
4.3++	Form of 7 ¼% Note due June 15, 2005.
4.4+++	Form of 7 3/4% Note due August 15, 2005.
4.5++++	Form of 6.69% Note due October 30, 2006.
4.6+++++	Description of 7 5/8% Notes due April 15, 2007.
4.7@	Form of 6.9% Note due August 1, 2007.
4.8@@	Form of 4.861% Note due November 30, 2007.
4.9@@@	Form of 4.75% Note due June 15, 2009.
4.10@@@@	Terms Agreement regarding 6.95% Notes due March 2, 2011.
4.11§	Terms Agreement regarding 6.625% Notes due March 15, 2012.
4.12§§	Form of 5.2% Note due April 1, 2013.
4.13§§§	Form of 5.25% Note due September 15, 2014.
4.14§§§§	Terms Agreement regarding 6.63% Notes due April 13, 2015.
4.15§§§§§	Terms Agreement regarding 7 1/8% Notes due October 15, 2017.
4.16§§§§§§	Terms Agreement regarding 7.57% Notes due August 15, 2026.
10.1^	Fifth Amended and Restated Agreement of Limited Partnership of ERP Operating Limited Partnership.
10.2^^	Master Amendment to Other Securities Term Sheets and Joinders to Operating Partnership Agreement of ERP Operating Limited Partnership dated December 19, 2003.
10.3^^	Assignment and Assumption Agreement between the Company and ERP Operating Limited Partnership dated December 19, 2003.
10.4***	Noncompetition Agreement (Zell).
10.5***	Noncompetition Agreement (Spector).
10.6***	Form of Noncompetition Agreement (other officers).
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.
10.8••	Revolving Credit Agreement dated as of May 29, 2002 among the Operating Partnership, Bank of America, National Association, as administrative agent, JP Morgan Chase Bank, as syndication agent, and the banks named therein.
10.9••	Guaranty of Payment, dated as of May 29, 2002, between the Company and Bank of America, N.A., as administrative agent.
10.10****	Amended and Restated Limited Partnership Agreement of Lexford Properties, L.P.
10.11•	Amended and Restated Equity Residential Advantage Retirement Savings Plan, effective January 1, 2001.
10.12^^	First Amendment to the Equity Residential Advantage Retirement Savings Plan, effective December 2002.
10.13^^	Second Amendment to the Equity Residential Advantage Retirement Savings Plan, effective December 2002.
10.14^^	Third Amendment to the Equity Residential Advantage Retirement Savings Plan, effective May 2003.
10.15•••	Equity Residential 2002 Share Incentive Plan.

53

10.16	First Amendment to Equity Residential 2002 Share Incentive Plan.
10.17	Second Amendment to Equity Residential 2002 Share Incentive Plan.
10.18	Form of 2005 Equity Residential Performance Based Unit Award Grant Agreement.
10.19•	Form of Change in Control Agreement between the Company and other executive officers.
10.20^^	Form of Indemnification Agreement between the Company and each trustee and executive officer.
10.21#	Amended and Restated Executive Compensation Agreement between the Company and Samuel Zell dated March 5, 2003, but effective as of January 1, 2003.
10.22	First Amendment to Amended and Restated Executive Compensation Agreement between the Company and Samuel Zell dated February 3, 2005.
10.23•	Amended and Restated Deferred Compensation Agreement between the Company and Douglas Crocker II dated as of January 21, 2002.
10.24•	Amended and Restated Deferred Compensation Agreement between the Company and Gerald A. Spector dated January 1, 2002.
10.25•	Retirement Benefits Agreement between Samuel Zell and the Company dated October 18, 2001.
10.26#	Employment Agreement between the Company and Bruce W. Duncan dated as of January 20, 2003.
10.27#	Deferred Compensation Agreement between the Company and Bruce W. Duncan dated as of January 20, 2003.
12	Computation of Ratio of Earnings to Combined Fixed Charges.
21	List of Subsidiaries of Equity Residential.
23.1	Consent of Ernst & Young LLP.
24.1	Power of Attorney for John W. Alexander dated March 9, 2005.
24.2	Power of Attorney for Stephen O. Evans dated March 1, 2005.
24.3	Power of Attorney for Charles L. Atwood dated March 7, 2005.
24.4	Power of Attorney for Desiree G. Rogers dated March 7, 2005.
24.5	Power of Attorney for B. Joseph White dated March 4, 2005.
24.6	Power of Attorney for Sheli Z. Rosenberg dated March 8, 2005.
24.7	Power of Attorney for James D. Harper, Jr. dated March 4, 2005.
24.8	Power of Attorney for Boone A. Knox dated March 2, 2005.
24.9	Power of Attorney for Samuel Zell dated March 9, 2005.
24.10	Power of Attorney for Gerald A. Spector dated March 1, 2005.
31.1	Certification of Bruce W. Duncan, Chief Executive Officer.
31.2	Certification of Donna Brandin, Chief Financial Officer.
32.1	Certification Pursuant to 18 U.S.C. Section 1350, as adopted, pursuant to Section 906 of the Sarbanes–Oxley Act of 2002, of Bruce W. Duncan, Chief Executive Officer of the Company.
32.2	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.

+	Included as an exhibit to the Company’s Form 8-K dated December 9, 2004, filed on December 10, 2004.
++	Included as an exhibit to Form 8-K of Merry Land & Investment Company, Inc., filed on June 20, 1995.
+++	Included as an exhibit to Form 10-K of Wellsford Residential Property Trust for the year ended December 31, 1995.
++++	Included as an exhibit to Form 8-K of Merry Land & Investment Company, Inc., filed on October 31, 1997.
+++++	Contained in 424B2 Prospectus Filing of Evans Withycombe Residential, Inc. dated March 28, 1997.
@	Included as an exhibit to Form 8-K of Merry Land & Investment Company, Inc., filed on July 29, 1997.
@@	Included as an exhibit to the Operating Partnership’s Form 8-K, filed on November 20, 2002.
@@@	Included as an exhibit to the Operating Partnership’s Form 8-K, filed on June 4, 2004.
@@@@	Included as an exhibit to the Operating Partnership’s Form 8-K, filed on March 2, 2001.

54

§	Included as an exhibit to the Operating Partnership’s Form 8-K, filed on March 14, 2002.
§§	Included as an exhibit to the Operating Partnership’s Form 8-K, filed on March 19, 2003.
§§§	Included as an exhibit to the Operating Partnership’s Form 8-K, filed on September 10, 2004.
§§§§	Included as an exhibit to the Operating Partnership’s Form 8-K, filed on April 13, 1998.
§§§§§	Included as an exhibit to the Operating Partnership’s Form 8-K, filed on October 9, 1997.
§§§§§§	Included as an exhibit to the Operating Partnership’s Form 8-K, filed on August 13, 1996.
*	Included as an exhibit to the Operating Partnership’s Form 10/A, dated December 12, 1994, File No. 0-24920, and incorporated herein by reference.
**	Included as an exhibit to the Operating Partnership’s Form 8-K, filed on September 10, 2004.
^	Included as an exhibit to the Operating Partnership’s Form 8-K/A dated July 23, 1998, filed on August 18, 1998.
^^	Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2003.
***	Included as an exhibit to the Company’s Form S-11 Registration Statement, File No. 33-63158, and incorporated herein by reference.
****	Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 1999.
•	Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2001.
••	Included as an exhibit to the Company’s Form 10-Q for the quarterly period ended June 30, 2002.
•••	Included as an exhibit to the Company’s Form S-8 filed on January 21, 2003.
#	Included as an exhibit to the Company’s Form 10-K for the year ended December 31, 2002.

(c)  Financial Statement Schedules: See Index to Financial Statements attached hereto on page F-1 of this Form 10-K.

55

SIGNATURES

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 behalf by the undersigned thereunto duly authorized.

EQUITY RESIDENTIAL

Date:	March 14, 2005	By:	/s/	Bruce W. Duncan
				Bruce W. Duncan
		President, Chief Executive Officer,
		and Trustee

Date:	March 14, 2005	By:	/s/	Donna Brandin
				Donna Brandin
		Executive Vice President and
		Chief Financial Officer

Date:	March 14, 2005	By:	/s/	Michael J. McHugh
				Michael J. McHugh
		Executive Vice President, Chief Accounting
		Officer, Treasurer and *Attorney-in-fact

Pursuant to the requirements of the Securities Exchange Act of 1934, the following persons on behalf of the registrant and in the capacities and on the dates indicated have signed this report below.

Date:	March 14, 2005	By:	/s/	Samuel Zell*
				Samuel Zell
		Chairman of the Board of Trustees

Date:	March 14, 2005	By:	/s/	Gerald A. Spector*
				Gerald A. Spector
		Executive Vice President, Chief
		Operating Officer and Trustee

Date:	March 14, 2005	By:	/s/	Sheli Z. Rosenberg*
				Sheli Z. Rosenberg
		Trustee

Date:	March 14, 2005	By:	/s/	James D. Harper*
				James D. Harper
		Trustee

Date:	March 14, 2005	By:	/s/	John W. Alexander*
				John W. Alexander
		Trustee

56

SIGNATURES-CONTINUED

Date:	March 14, 2005	By:	/s/	B. Joseph White*
				B. Joseph White
		Trustee

Date:	March 14, 2005	By:	/s/	Charles L. Atwood*
				Charles L. Atwood
		Trustee

Date:	March 14, 2005	By:	/s/	Desiree G. Rogers*
				Desiree G. Rogers
		Trustee

Date:	March 14, 2005	By:	/s/	Stephen O. Evans*
				Stephen O. Evans
		Trustee

Date:	March 14, 2005	By:	/s/	Boone A. Knox*
				Boone A. Knox
		Trustee

* By:	/s/ Michael J. McHugh
	Michael J. McHugh
	as Attorney-in-fact

57

INDEX TO FINANCIAL STATEMENTS AND SCHEDULE

EQUITY RESIDENTIAL

	PAGE
FINANCIAL STATEMENTS FILED AS PART OF THIS REPORT
Report of Independent Registered Public Accounting Firm		F-2
Report of Independent Registered Public Accounting Firm on
Internal Control over Financial Reporting		F-3
Consolidated Balance Sheets as of
December 31, 2004 and 2003		F-4
Consolidated Statements of Operations for
the years ended December 31, 2004, 2003 and 2002		F-5 to F-6
Consolidated Statements of Cash Flows for
the years ended December 31, 2004, 2003 and 2002		F-7 to F-9
Consolidated Statements of Changes in Shareholders’ Equity
for the years ended December 31, 2004, 2003 and 2002		F-10 to F-11
Notes to Consolidated Financial Statements		F-12 to F-44
SCHEDULE FILED AS PART OF THIS REPORT
Schedule III - Real Estate and Accumulated Depreciation		S-1 to S-16

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, 2004 and 2003 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, 2004.  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, 2004 and 2003, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2004, 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.

As discussed in Note 2 to the consolidated financial statements, the Company changed its method of accounting for variable interest entities in 2004 and changed its method of accounting for stock-based compensation in 2003.

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, 2004, 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 28, 2005 expressed an unqualified opinion thereon.

/s/ ERNST & YOUNG LLP

ERNST & YOUNG LLP

Chicago, Illinois

February 28, 2005

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, 2004, 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, 2004, 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, 2004, 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, 2004 and 2003 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, 2004 and our report dated February 28, 2005 expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP

Ernst & Young LLP

Chicago, Illinois

February 28, 2005

F-3

EQUITY RESIDENTIAL

CONSOLIDATED BALANCE SHEETS

(Amounts in thousands except for share amounts)

	December 31, 2004			December 31, 2003
ASSETS
Investment in real estate
Land	$	2,183,818		$	1,845,547
Depreciable property	12,350,900			11,018,326
Construction in progress (including land)	317,903			10,506
Investment in real estate	14,852,621			12,874,379
Accumulated depreciation	(2,599,827		)	(2,296,013		)
Investment in real estate, net	12,252,794			10,578,366
Cash and cash equivalents	83,505			49,579
Investments in unconsolidated entities	11,461			473,977
Rents receivable	1,681			426
Deposits – restricted	82,194			133,752
Escrow deposits – mortgage	35,800			41,104
Deferred financing costs, net	34,986			31,135
Goodwill, net	30,000			30,000
Other assets	112,854			128,554
Total assets	$	12,645,275		$	11,466,893
LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Mortgage notes payable	$	3,166,739		$	2,693,815
Notes, net	3,143,067			2,656,674
Line of credit	150,000			10,000
Accounts payable and accrued expenses	87,422			55,463
Accrued interest payable	70,411			60,334
Rents received in advance and other liabilities	227,588			189,372
Security deposits	49,501			44,670
Distributions payable	142,437			140,195
Total liabilities	7,037,165			5,850,523
Commitments and contingencies
Minority Interests:
Operating Partnership	319,841			342,809
Preference Interests	206,000			246,000
Junior Preference Units	184			2,217
Partially Owned Properties	9,557			9,903
Total Minority Interests	535,582			600,929
Shareholders’ equity:
Preferred Shares of beneficial interest, $0.01 par value; 100,000,000 shares authorized; 4,108,658 shares issued and outstanding as of December 31, 2004 and 5,496,518 shares issued and outstanding as of December 31, 2003	636,216			670,913
Common Shares of beneficial interest, $0.01 par value; 1,000,000,000 shares authorized; 285,076,915 shares issued and outstanding as of December 31, 2004 and 277,643,885 shares issued and outstanding as of December 31, 2003	2,851			2,776
Paid in capital	5,112,311			4,956,712
Deferred compensation	(18		)	(3,554		)
Distributions in excess of accumulated earnings	(657,462		)	(588,005		)
Accumulated other comprehensive loss	(21,370		)	(23,401		)
Total shareholders’ equity	5,072,528			5,015,441
Total liabilities and shareholders’ equity	$	12,645,275		$	11,466,893

See accompanying notes

F-4

EQUITY RESIDENTIAL

CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands except per share data)

	Year Ended December 31,
	2004			2003			2002
REVENUES
Rental income	$	1,878,262		$	1,691,647		$	1,677,459
Fee and asset management	11,239			14,373			9,582
Total revenues	1,889,501			1,706,020			1,687,041
EXPENSES
Property and maintenance	520,412			460,426			427,960
Real estate taxes and insurance	222,448			184,483			170,029
Property management	75,888			68,058			72,416
Fee and asset management	8,623			7,819			7,885
Depreciation	484,209			414,998			389,580
General and administrative	51,236			38,810			46,492
Impairment on technology investments	—			1,162			1,162
Impairment on corporate housing business	—			—			17,122
Total expenses	1,362,816			1,175,756			1,132,646
Operating income	526,685			530,264			554,395
Interest and other income	10,685			16,217			14,792
Interest:
Expense incurred, net	(342,591		)	(322,903		)	(327,662		)
Amortization of deferred financing costs	(6,723		)	(5,612		)	(5,502		)
Income before allocation to Minority Interests, loss from investments in unconsolidated entities, net gain on sales of unconsolidated entities and discontinued operations	188,056			217,966			236,023
Allocation to Minority Interests:
Operating Partnership	(31,228		)	(34,658		)	(26,862		)
Preference Interests	(19,420		)	(20,211		)	(20,211		)
Junior Preference Units	(70		)	(325		)	(325		)
Partially Owned Properties	1,787			271			(1,867		)
Premium on redemption of Preference Interests	(1,117		)	—			—
Loss from investments in unconsolidated entities	(7,325		)	(10,118		)	(3,698		)
Net gain on sales of unconsolidated entities	4,593			4,942			5,054
Income from continuing operations	135,276			157,867			188,114
Net gain on sales of discontinued operations	323,925			310,706			104,296
Discontinued operations, net	13,128			54,738			108,367
Net income	472,329			523,311			400,777
Preferred distributions	(53,746		)	(76,435		)	(76,615		)
Premium on redemption of Preferred Shares	—			(20,237		)	—
Net income available to Common Shares	$	418,583		$	426,639		$	324,162
Earnings per share – basic:
Income from continuing operations available to Common Shares	$	0.38		$	0.33		$	0.47
Net income available to Common Shares	$	1.50		$	1.57		$	1.19
Weighted average Common Shares outstanding	279,744			272,337			271,974
Earnings per share – diluted:
Income from continuing operations available to Common Shares	$	0.37		$	0.32		$	0.46
Net income available to Common Shares	$	1.48		$	1.55		$	1.18
Weighted average Common Shares outstanding	303,871			297,041			297,969
Distributions declared per Common Share outstanding	$	1.73		$	1.73		$	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,
	2004			2003		2002
Comprehensive income:
Net income	$	472,329		$	523,311	$	400,777
Other comprehensive income (loss) – derivative and other instruments:
Unrealized holding (losses) gains arising during the year	(3,707		)	11,467		(10,905		)
Equity in unrealized holding gains (losses) arising during the year – unconsolidated entities	3,667			7,268		(689		)
Losses reclassified into earnings from other comprehensive income	2,071			1,653		845
Comprehensive income	$	474,360		$	543,699	$	390,028

See accompanying notes

F-6

EQUITY RESIDENTIAL

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

	Year Ended December 31,
	2004			2003			2002
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	472,329		$	523,311		$	400,777
Adjustments to reconcile net income to net cash provided by operating activities:
Allocation to Minority Interests:
Operating Partnership	31,228			34,658			26,862
Preference Interests	19,420			20,211			20,211
Junior Preference Units	70			325			325
Partially Owned Properties	(1,787		)	(271		)	1,867
Premium on redemption of Preference Interests	1,117			—			—
Depreciation	496,583			471,569			472,956
Amortization of deferred financing costs	7,276			6,702			5,754
Amortization of discounts and premiums on debt	(784		)	(991		)	(822		)
Amortization of deferred settlements on derivative instruments	1,001			710			(306		)
Impairment on technology investments	—			1,162			1,162
Impairment on corporate housing business	—			—			17,122
Loss from investments in unconsolidated entities	7,325			10,118			3,698
Net (gain) on sales of unconsolidated entities	(4,593		)	(4,942		)	(5,054		)
Net (gain) on sales of discontinued operations	(323,925		)	(310,706		)	(104,296		)
Loss on debt extinguishments	113			2,095			792
Unrealized loss (gain) on derivative instruments	249			(118		)	328
Compensation paid with Company Common Shares	16,826			14,883			25,796
Other operating activities, net	(178		)	(3,147		)	2
Changes in assets and liabilities:
(Increase) decrease in rents receivable	(628		)	2,234			(570		)
(Increase) decrease in deposits – restricted	(6,037		)	4,406			9,896
(Increase) decrease in other assets	(20,341		)	(18,940		)	14,531
Increase (decrease) in accounts payable and accrued expenses	2,844			(4,682		)	(3,392		)
Increase (decrease) in accrued interest payable	9,176			(2,851		)	406
Increase (decrease) in rents received in advance and other liabilities	7,655			(170		)	2,369
Increase (decrease) in security deposits	2,811			(1,247		)	(2,151		)
Net cash provided by operating activities	717,750			744,319			888,263
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in real estate – acquisitions	(820,029		)	(595,077		)	(258,269		)
Investment in real estate – development/other	(117,940		)	(8,386		)	(109,077		)
Improvements to real estate	(212,171		)	(181,948		)	(156,776		)
Additions to non-real estate property	(6,552		)	(2,928		)	(7,301		)
Interest capitalized for real estate under development	(11,687		)	—			(10,006		)
Interest capitalized for unconsolidated entities under development	(2,282		)	(20,647		)	(17,161		)
Proceeds from disposition of real estate, net	937,690			1,130,925			478,675
Proceeds from disposition of unconsolidated entities	7,940			14,136			49,862
Proceeds from refinancing of unconsolidated entities	—			6,708			4,375
Proceeds from disposition of furniture rental business	—			—			28,741
Investments in unconsolidated entities	(406,524		)	(14,038		)	(105,758		)
Distributions from unconsolidated entities	26,553			20,515			41,656
Decrease (increase) in deposits on real estate acquisitions, net	58,715			(22,656		)	24,845
Decrease in mortgage deposits	9,144			11,298			27,425

See accompanying notes

F-7

EQUITY RESIDENTIAL

CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(Amounts in thousands)

	Year Ended December 31,
	2004			2003			2002
CASH FLOWS FROM INVESTING ACTIVITIES (continued):
Consolidation of previously Unconsolidated Properties:
Via acquisition (net of cash acquired)	$	(49,183	)	$	6,879		$	(40,113	)
Via FIN 46 (cash consolidated)	3,628			—			—
Acquisition of Minority Interests – Partially Owned Properties	(72		)	(125		)	—
Other investing activities, net	16,802			(10,628		)	260
Net cash (used for) provided by investing activities	(565,968		)	334,028			(48,622		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Loan and bond acquisition costs	(9,696		)	(6,127		)	(11,233		)
Mortgage notes payable:
Proceeds	467,541			111,150			126,144
Lump sum payoffs	(469,333		)	(401,951		)	(374,983		)
Scheduled principal repayments	(25,607		)	(30,919		)	(32,731		)
Prepayment premiums/fees	(450		)	(2,187		)	(792		)
Notes, net:
Proceeds	898,014			398,816			447,064
Lump sum payoffs	(531,390		)	(190,000		)	(265,000		)
Scheduled principal repayments	(4,286		)	(4,480		)	(4,669		)
Line of credit:
Proceeds	1,742,000			182,000			776,500
Repayments	(1,602,000		)	(312,000		)	(831,500		)
(Payments on) proceeds from settlement of derivative instruments	(7,346		)	(12,999		)	5,757
Proceeds from sale of Common Shares	6,853			6,324			9,411
Proceeds from sale of Preferred Shares	—			150,000			—
Proceeds from exercise of options	79,043			68,400			29,578
Common Shares repurchased and retired	—			—			(115,004		)
Redemption of Preferred Shares	—			(386,989		)	—
Redemption of Preference Interests	(40,000		)	—			—
Premium on redemption of Preferred Shares	—			(8,345		)	—
Payment of offering costs	(24		)	(5,304		)	(207		)
Contributions – Minority Interests – Partially Owned Properties	100			—			—
Distributions:
Common Shares	(484,540		)	(472,211		)	(473,996		)
Preferred Shares	(54,350		)	(79,341		)	(76,973		)
Preference Interests	(19,464		)	(20,211		)	(20,238		)
Junior Preference Units	(148		)	(324		)	(325		)
Minority Interests – Operating Partnership	(36,446		)	(38,472		)	(39,607		)
Minority Interests – Partially Owned Properties	(26,327		)	(3,473		)	(12,608		)
Principal receipts on employee notes, net	—			—			4,043
Net cash (used for) financing activities	(117,856		)	(1,058,643		)	(861,369		)
Net increase (decrease) in cash and cash equivalents	33,926			19,704			(21,728		)
Cash and cash equivalents, beginning of year	49,579			29,875			51,603
Cash and cash equivalents, end of year	$	83,505		$	49,579		$	29,875

See accompanying notes

F-8

EQUITY RESIDENTIAL

CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(Amounts in thousands)

	Year Ended December 31,
	2004			2003			2002
SUPPLEMENTAL INFORMATION:
Cash paid during the year for interest	$	348,574		$	352,391		$	365,782
Valuation of OP Units issued – Other transactions	$	9,087		$	226		$	1,046
Real estate acquisitions/dispositions:
Mortgage loans assumed	$	95,901		$	89,446		$	32,355
Valuation of OP Units issued	$	—		$	105		$	—
Mortgage loans (assumed) by purchaser	$	(29,470	)	$	(53,250	)	$	(9,924	)
Consolidation of previously Unconsolidated Properties – Via acquisition:
Investment in real estate	$	(960,331	)	$	(111,113	)	$	(102,110	)
Mortgage loans assumed	$	274,818		$	51,625		$	18,100
Valuation of OP Units issued	$	—		$	4,231		$	—
Minority Interests – Partially Owned Properties	$	445		$	42		$	—
Investments in unconsolidated entities	$	608,681		$	34,942		$	(312	)
Net other liabilities recorded	$	27,204		$	27,152		$	44,209
Consolidation of previously unconsolidated properties – Via FIN 46:
Investment in real estate	$	(548,342	)	$	—		$	—
Mortgage loans consolidated	$	294,722		$	—		$	—
Minority interests – Partially Owned Properties	$	3,074		$	—		$	—
Investments in unconsolidated entities	$	234,984		$	—		$	—
Net other liabilities recorded	$	19,190		$	—		$	—
Deconsolidation of previously Wholly Owned Properties:
Mortgage loans contributed	$	—		$	—		$	(118,376	)
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,
	2004			2003			2002
PREFERRED SHARES
Balance, beginning of year	$	670,913		$	946,157		$	966,671
Conversion of 7.00% Series E Cumulative Convertible	(34,519		)	(8,891		)	(20,442		)
Conversion of 7.25% Series G Convertible Cumulative	—			(29,184		)	(2		)
Redemption of 7.25% Series G Convertible Cumulative	—			(286,989		)	—
Conversion of 7.00% Series H Cumulative Convertible	(178		)	(180		)	(70		)
Redemption of 7.625% Series L Cumulative Redeemable	—			(100,000		)	—
Issuance of 6.48% Series N Cumulative Redeemable	—			150,000			—
Balance, end of year	$	636,216		$	670,913		$	946,157
COMMON SHARES, $0.01 PAR VALUE
Balance, beginning of year	$	2,776		$	2,711		$	2,716
Issuance through conversion of Preferred Shares into Common Shares	16			14			9
Issuance through conversion of OP Units into Common Shares	17			7			9
Issuance through exercise of share options	34			32			15
Issuance through Employee Share Purchase Plan	3			3			3
Issuance through Share Purchase – DRIP Plan and Dividend Reinvestment –DRIP Plan	—			—			1
Stock-based employee compensation expense:
Restricted/performance shares	5			9			9
Common Shares repurchased and retired	—			—			(51		)
Balance, end of year	$	2,851		$	2,776		$	2,711
PAID IN CAPITAL
Balance, beginning of year	$	4,956,712		$	4,844,104		$	4,897,630
Issuance through conversion of Preferred Shares into Common Shares	34,681			38,241			20,505
Issuance through conversion of OP Units into Common Shares	36,903			10,896			14,759
Issuance of Common Shares through exercise of share options	79,009			68,368			29,563
Issuance of Common Shares through Employee Share Purchase Plan	6,850			6,321			7,374
Issuance of Common Shares through Share Purchase – DRIP Plan	—			—			861
Issuance of Common Shares through Dividend Reinvestment – DRIP Plan	—			—			1,172
Stock-based employee compensation expense:
Restricted/performance shares	9,013			2,488			12,127
Share options	2,982			2,626			—
ESPP discount	1,290			1,196			—
Common Shares repurchased and retired	—			—			(114,953		)
Offering costs	(24		)	(5,304		)	(207		)
Premium on redemption of Preferred Shares – original issuance costs	—			11,892			—
Premium on redemption of Preference Interests – original issuance costs	1,117			—			—
Other	(8,705		)	(24,661		)	(29,017		)
Adjustment for Minority Interests ownership in Operating Partnership	(7,517		)	545			4,290
Balance, end of year	$	5,112,311		$	4,956,712		$	4,844,104

See accompanying notes

F-10

EQUITY RESIDENTIAL

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Continued)

(Amounts in thousands)

	Year Ended December 31,
	2004			2003			2002
DEFERRED COMPENSATION
Balance, beginning of year	$	(3,554	)	$	(12,118	)	$	(25,778	)
Restricted/performance shares granted, net of cancellations	—			—			(12,136		)
Amortization to compensation expense – restricted/performance shares	3,536			8,564			25,796
Balance, end of year	$	(18	)	$	(3,554	)	$	(12,118	)
DISTRIBUTIONS IN EXCESS OF ACCUMULATED EARNINGS
Balance, beginning of year	$	(588,005	)	$	(539,942	)	$	(390,206	)
Net income	472,329			523,311			400,777
Common Share distributions	(488,040		)	(474,702		)	(473,898		)
Preferred Share distributions	(53,746		)	(76,435		)	(76,615		)
Premium on redemption of Preferred Shares – cash charge	—			(8,345		)	—
Premium on redemption of Preferred Shares – original issuance costs	—			(11,892		)	—
Balance, end of year	$	(657,462	)	$	(588,005	)	$	(539,942	)
ACCUMULATED OTHER COMPREHENSIVE LOSS
Balance, beginning of year	$	(23,401	)	$	(43,789	)	$	(33,040	)
Accumulated other comprehensive loss – derivative and other instruments:
Unrealized holding (losses) gains arising during the year	(3,707		)	11,467			(10,905		)
Equity in unrealized holding gains (losses) arising during the year – unconsolidated entities	3,667			7,268			(689		)
Losses reclassified into earnings from other comprehensive income	2,071			1,653			845
Balance, end of year	$	(21,370	)	$	(23,401	)	$	(43,789	)

See accompanying notes

F-11

EQUITY RESIDENTIAL

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.Business

Equity Residential (“EQR”), formed in March 1993, is a fully integrated real estate company engaged in the acquisition, development, ownership, management and operation of multifamily properties.  EQR has elected to be taxed as a real estate investment trust (“REIT”).

EQR is the general partner of, and as of December 31, 2004 owned an approximate 93.3% 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 each of the partnerships, limited liability companies and corporations controlled by the Operating Partnership and/or EQR.

As of December 31, 2004, the Company, directly or indirectly through investments in title holding entities, owned all or a portion of 939properties in 32 states and the District of Columbia consisting of 200,149 units.  The ownership breakdown includes:

	Properties	Units
Wholly Owned Properties	842	176,711
Partially Owned Properties (Consolidated)	39	7,220
Unconsolidated Properties	58	16,218
	939	200,149

The “Wholly Owned Properties” are accounted for under the consolidation method of accounting.  The Company beneficially owns 100% fee simple title to 841 of the 842 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” are controlled by the Company but have partners with minority interests and are accounted for under the consolidation method of accounting.  The “Unconsolidated Properties” are partially owned but not controlled by the Company.  With the exception of one property, the Unconsolidated Properties consist of investments in partnership interests and/or subordinated mortgages that are accounted for under the equity method of accounting.  The remaining one 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.  The above table does not include various uncompleted development properties.

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 Unconsolidated Properties 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.

F-12

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 $1,500 and $3,000 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 and sufficient 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).

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.

F-13

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, through the date the certificates of occupancy ("CO") are issued (CO's are deemed final within 90 days of issuance), 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.  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 rennovation 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 line 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 $18.1 million and $16.0 million at December 31, 2004 and 2003, 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 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 values of the Company’s financial instruments, other than derivative instruments, including cash and cash equivalents, mortgage notes payable, other notes payable, line of credit and other financial instruments, approximate their carrying or contract values.

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.

Stock-Based Compensation

Prior to 2003, the Company had chosen to account for its stock-based compensation in accordance with APB No. 25, Accounting for Stock Issued to Employees,which resulted in no compensation expense for options issued with an exercise price equal to or exceeding the market value of the Company’s Common Shares on the date of grant (intrinsic method).  The Company elected to account for its stock-based compensation in accordance with SFAS No. 123 and its amendment (SFAS No. 148), Accounting for Stock Based Compensation, effective in the first quarter of 2003, which resulted in compensation expense being recorded based on the fair value of the stock compensation granted.

The Company elected the “Prospective Method” which requires expensing of employee awards granted or modified after January 1, 2003.  Compensation expense under all of the Company’s plans is generally recognized over periods ranging from three months to five years.  The cost related to stock-based employee compensation included in the determination of net income for the years ended December 31, 2004 and 2003 is less than that which would have been recognized if the fair value based method had been applied to all awards since the original effective date of SFAS No. 123.

The Company will adopt SFAS No. 123(R), Share-Based Payment, as required effective July 1, 2005.   The Company does not anticipate that the adoption of SFAS No. 123(R) will have a material effect on its consolidated statements of operations or financial position.

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 in each period presented:

F-16

	Year Ended December 31,
	2004			2003			2002
	(Amounts in thousands except per share amounts)
Net income available to Common Shares – as reported	$	418,583		$	426,639		$	324,162
Add: Stock-based employee compensation expense included in reported net income:
Restricted/performance shares	12,554			11,043			25,839
Share options (1)	2,982			2,626			—
ESPP discount	1,290			1,196			—
Deduct: Stock-based employee compensation expense determined under fair value based method for all awards:
Restricted/performance shares	(12,554		)	(11,043		)	(25,839		)
Share options (1)	(5,385		)	(6,784		)	(6,249		)
ESPP discount	(1,290		)	(1,196		)	(1,379		)
Net income available to Common Shares – pro forma	$	416,180		$	422,481		$	316,534
Earnings per share:
Basic – as reported	$	1.50		$	1.57		$	1.19
Basic – pro forma	$	1.49		$	1.55		$	1.16
Diluted – as reported	$	1.48		$	1.55		$	1.18
Diluted – pro forma	$	1.47		$	1.54		$	1.15

(1)Share options for the year ended December 31, 2003 included $1.4 million of expense recognition related to options granted in the first quarter of 2003 to the Company’s former chief executive officer.  These options vested immediately upon grant.

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:

	2004	2003	2002
Risk-free interest rate	3.03%	3.02%	4.55%
Expected dividend yield	6.52%	6.46%	6.46%
Volatility	20.0%	20.8%	20.8%
Expected life of the options	5 years	5 years	7 years
Fair value of options granted	$2.26	$1.90	$2.69

 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.  In addition, option valuation models require the input of highly subjective assumptions including the expected stock price volatility. 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.

F-17

Income Taxes

Due to the structure of the Company as a REIT and the nature of the operations of the properties and management business, the results of operations do not contain a provision for federal income taxes. The Company is subject to certain state and local income, excise and franchise taxes.  The aggregate cost of land and depreciable property for federal income tax purposes as of December 31, 2004 and 2003 was approximately $9.3 billion and $8.5 billion, respectively.

The Company has elected Taxable REIT Subsidiary (“TRS”) status for certain of its corporate subsidiaries.  The federal income taxes for these TRS entities were not material during 2004, 2003 or 2002 and were recognized as general and administrative expenses in the consolidated statements of operations.

During the years ended December 31, 2004, 2003 and 2002, the Company’s tax treatment of dividends and distributions were as follows:

	Year Ended December 31,
	2004		2003		2002
Tax treatment of dividends and distributions:
Ordinary dividends	$	1.104	$	0.799	$	1.398
Qualified dividends	0.003		0.009		—
Pre-May 6, 2003 long-term capital gain	—		0.150		0.212
Post-May 5, 2003 long-term capital gain	0.432		0.315		—
Unrecaptured section 1250 gain	0.151		0.251		0.120
Nontaxable distributions	0.040		0.206		—
Dividends and distributions declared per Common Share outstanding	$	1.730	$	1.730	$	1.730

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 proceeds therefrom 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.

Use 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.

F-18

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.  As of the original formation of the respective joint ventures, the Company is considered to be the primary beneficiary and the fair value of the assets, liabilities and non-controlling interests of these development projects approximates carryover basis.  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 from investments in unconsolidated entities.  See Note 4 for additional discussion.

The Company generally contributes between 25% and 35% of the project cost of the joint venture projects under development (constituting 100% of the equity), with the remaining cost financed through third-party construction mortgages.  Voting rights are shared equally between the Company and its respective development partners and accordingly, these projects were accounted for under the equity method prior to the adoption of FIN No. 46.

In May 2003, the FASB issued SFAS No. 150, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity.  SFAS No. 150 establishes standards for classifying and measuring as liabilities certain financial instruments that embody obligations of the issuer and have characteristics of both liabilities and equity.  On November 7, 2003, the FASB issued FSP No. FAS 150-3, which deferred for an indefinite period the classification and measurement provisions, but not the disclosure provisions (see discussion below), of SFAS No. 150 as it relates to 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 does not have any mandatorily redeemable preferred shares/units that fall within the scope of SFAS No. 150.

With regards to the aforementioned disclosure provisions, the Company is presently the controlling partner in various consolidated partnerships consisting of 39 properties and 7,220 units having a minority interest book value of $9.6 million at December 31, 2004. 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, 2004, the Company estimates the value of Minority Interest distributions would have been approximately $111.3 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, 2004 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

F-19

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.

On July 31, 2003, the SEC clarified its position with respect to Emerging Issues Task Force (“EITF”) Topic D-42, The Effect on the Calculation of Earnings per Share for the Redemption or Induced Conversion of Preferred Stock.  Under the SEC’s revised interpretation, in connection with the redemption of preferred shares/units, the original issuance costs of these shares/units must be treated in a manner similar to preferred distributions and deducted from net income in arriving at net income available to Common Shares.  The clarification of EITF Topic D-42 was required to be adopted effective July 1, 2003 on a retroactive basis by restating prior periods included in the current financial statements.  The Company recorded an $8.3 million cash premium and $11.9 million in original issuance costs as a premium on the redemption of its Series G Preferred Shares in December 2003.  In addition, the Company recorded $1.1 million in original issuance costs as a premium on the redemption of its Series A Preference Interests in September 2004.  The Company had no recorded original issuance costs associated with, nor did it incur any cash redemption premium upon redemption of, its Series L Preferred Shares redeemed in 2003.

In April 2002, the FASB issued SFAS No. 145, Rescission of FASB Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and Technical Corrections.  SFAS No. 145, among other items, rescinds the automatic classification of costs incurred on debt extinguishment as extraordinary charges.  Instead, gains and losses from debt extinguishment should only be classified as extraordinary if they meet the “unusual and infrequently occurring” criteria outlined in APB No. 30.  SFAS No. 145 is effective for fiscal years beginning after May 15, 2002.  The Company adopted the standard effective January 1, 2003.Prior period gains/losses have been reclassified to a component of interest expense.

3.Shareholders’ Equity and Minority Interests

The following tables present the changes in the Company’s issued and outstanding Common Shares and OP Units for the years ended December 31, 2004, 2003 and 2002:

	2004		2003		2002
Common Shares outstanding at January 1,	277,643,885		271,095,481		271,621,374
Common Shares Issued:
Conversion of Series E Preferred Shares	1,536,501		395,723		909,873
Conversion of Series G Preferred Shares	—		996,459		70
Conversion of Series H Preferred Shares	10,268		10,424		4,050
Employee Share Purchase Plan	275,616		289,274		324,238
Dividend Reinvestment – DRIP Plan	—		—		41,407
Share Purchase – DRIP Plan	—		—		31,354
Exercise of options	3,350,759		3,249,555		1,435,115
Restricted share grants, net	515,622		900,555		885,967
Conversion of OP Units	1,744,463		706,631		933,937
Common Shares Other:
Common Shares repurchased and retired	—		—		(5,092,300	)
Common Shares other	(199	)	(217	)	396
Common Shares outstanding at December 31,	285,076,915		277,643,885		271,095,481

F-20

	2004			2003			2002
OP Units outstanding at January 1,	21,907,732			22,300,643			23,197,192
OP Units Issued:
Other transactions	306,694			165,628			37,388
Conversion of Series A Junior Preference Units	82,977			148,092			—
Conversion of OP Units to Common Shares	(1,744,463		)	(706,631		)	(933,937		)
OP Units Outstanding at December 31,	20,552,940			21,907,732			22,300,643
Total Common Shares and OP Units Outstanding at December 31,	305,629,855			299,551,617			293,396,124
OP Units Ownership Interest in Operating Partnership	6.7		%	7.3		%	7.6		%
OP Units Issued:
Other transactions – per unit	$	29.63		$	27.55		$	27.98
Other transactions – valuation	$	9.1 million		$	4.6 million		$	1.0 million
Conversion of Series A Junior Preference Units – per unit	$	24.50		$	24.50		—
Conversion of Series A Junior Preference Units – valuation	$	2.0 million		$	3.6 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 December 31, 2004, $956.5 million in equity securities remained available for issuance under this registration statement.

During October 2002, the Company repurchased 5,092,300 of its Common Shares on the open market at an average price of $22.58 per share.  The Company paid approximately $115.0 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 a partnership interest 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.  These OP Units are classified as Minority Interests – Operating Partnership in the accompanying consolidated balance sheets.

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, 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 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, 2004 and 2003:

F-21

			Annual
			Dividend		Amounts in thousands
	Redemption Date (1) (2)	Conversion Rate (2)	Rate per Share (3)		December 31, 2004		December 31, 2003
Preferred Shares of beneficial interest, $0.01 par value; 100,000,000 shares authorized:
9 1/8% Series B Cumulative Redeemable Preferred; liquidation value $250 per share; 500,000 shares issued and outstanding at December 31, 2004 and December 31, 2003	10/15/05	N/A	$	22.81252	$	125,000	$	125,000
9 1/8% Series C Cumulative Redeemable Preferred; liquidation value $250 per share; 460,000 shares issued and outstanding at December 31, 2004 and December 31, 2003	9/9/06	N/A	$	22.81252	115,000		115,000
8.60% Series D Cumulative Redeemable Preferred; liquidation value $250 per share; 700,000 shares issued and outstanding at December 31, 2004 and December 31, 2003	7/15/07	N/A	$	21.50	175,000		175,000
7.00% Series E Cumulative Convertible Preferred; liquidation value $25 per share; 811,724 and 2,192,490 shares issued and outstanding at December 31, 2004 and December 31, 2003, respectively	11/1/98	1.1128	$	1.75	20,293		54,812
7.00% Series H Cumulative Convertible Preferred; liquidation value $25 per share; 36,934 and 44,028 shares issued and outstanding at December 31, 2004 and December 31, 2003, respectively	6/30/98	1.4480	$	1.75	923		1,101
8.29% Series K Cumulative Redeemable Preferred; liquidation value $50 per share; 1,000,000 shares issued and outstanding at December 31, 2004 and December 31, 2003	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, 2004 and December 31, 2003	6/19/08	N/A	$	16.20	150,000		150,000
					$	636,216	$	670,913

(1)On or after the redemption date, redeemable preferred shares (Series B, C, 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 or Common Shares, in whole or in part, at various redemption prices per share based upon the contractual conversion rate, plus accrued and unpaid distributions, if any.

(3)Dividends on all series of Preferred Shares are payable quarterly at various pay dates.  Dividend rates listed for Series B, C, D and N are Preferred Share rates and the equivalent Depositary Share annual dividend rates are $2.281252, $2.281252, $2.15 and $1.62, respectively.

                On June 19, 2003. the Company redeemed all of its outstanding Series L Cumulative Redeemable Preferred Shares at liquidation value for total cash consideration of $100.0 million.  The Company did not incur any original issuance costs as these shares were issued by Merry Land & Investment Company, Inc. prior to its merger with the Company.

                On June 19, 2003, the Company issued 600,000 Series N Cumulative Redeemable Preferred Shares in a public offering.  The Company received $145.3 million in net proceeds from this offering after payment of the underwriters’ fee.

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                On December 26, 2003, the Company redeemed the remaining outstanding Series G Convertible Cumulative Preferred Shares for cash consideration of $295.3 million, which included the liquidation value of $287.0 million and a cash redemption premium of $8.3 million.  The Company recorded the $8.3 million cash redemption premium along with the write-off of $11.9 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, 2004 and December 31, 2003:

			Annual
	Redemption Date (1) (2)	Conversion Rate (2)	Dividend Rate per Unit (3)		Amounts in thousands
					December 31, 2004		December 31, 2003
Preference Interests:
8.00% Series A Cumulative Redeemable Preference Interests; liquidation value $50 per unit; 0 and 800,000 units issued and outstanding at December 31, 2004 and December 31, 2003, respectively	10/01/04	N/A	(4)		$	—	$	40,000
8.50% Series B Cumulative Redeemable Preference Units; liquidation value $50 per unit; 1,100,000 units issued and outstanding at December 31, 2004 and December 31, 2003 (5)	03/03/05	N/A	$	4.25	55,000		55,000
8.50% Series C Cumulative Redeemable Preference Units; liquidation value $50 per unit; 220,000 units issued and outstanding at December 31, 2004 and December 31, 2003 (6)	03/23/05	N/A	$	4.25	11,000		11,000
8.375% Series D Cumulative Redeemable Preference Units; liquidation value $50 per unit; 420,000 units issued and outstanding at December 31, 2004 and December 31, 2003	05/01/05	N/A	$	4.1875	21,000		21,000
8.50% Series E Cumulative Redeemable Preference Units; liquidation value $50 per unit; 1,000,000 units issued and outstanding at December 31, 2004 and December 31, 2003	08/11/05	N/A	$	4.25	50,000		50,000
8.375% Series F Cumulative Redeemable Preference Units; liquidation value $50 per unit; 180,000 units issued and outstanding at December 31, 2004 and December 31, 2003	05/01/05	N/A	$	4.1875	9,000		9,000
7.875% Series G Cumulative Redeemable Preference Units; liquidation value $50 per unit; 510,000 units issued and outstanding at December 31, 2004 and December 31, 2003	03/21/06	N/A	$	3.9375	25,500		25,500
7.625% Series H Cumulative Convertible Redeemable Preference Units; liquidation value $50 per unit; 190,000 units issued and outstanding at December 31, 2004 and December 31, 2003	03/23/06	1.5108	$	3.8125	9,500		9,500
7.625% Series I Cumulative Convertible Redeemable Preference Units; liquidation value $50 per unit; 270,000 units issued and outstanding at December 31, 2004 and December 31, 2003	06/22/06	1.4542	$	3.8125	13,500		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, 2004 and December 31, 2003	12/14/06	1.4108	$	3.8125	11,500		11,500
					$	206,000	$	246,000

(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.

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(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 (Series H, I & J) 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.

(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 September 1, 2004, the Company issued an irrevocable notice to redeem for cash on October 1, 2004 all 800,000 units of its 8.00% Series A Cumulative Redeemable Preference Interests.  The liquidation value of the preference interests was $40.0 million.  The Company recorded a write-off of $1.1 million in original issuance costs as a premium on redemption of Preference Interests (Minority Interests) in the accompanying consolidated statements of operations.

(5)On February 1, 2005, the Company issued an irrevocable notice to redeem for cash on March 3, 2005 all 1.1 million units of its 8.50% Series B Cumulative Redeemable Preference Interests with a liquidation value of $55.0 million.  The Company will record a write-off of approximately $1.4 million in original issuance costs as a premium on redemption of Preference Interests (Minority Interests) in the first quarter of 2005.

(6)On February 7, 2005, the Company issued an irrevocable notice to redeem for cash on March 23, 2005 all 220,000 units of its 8.50% Series C Cumulative Redeemable Preference Interests with a liquidation value of $11.0 million. The Company will record a write-off of approximately $275,000 in original issuance costs as a premium on redemption of Preference Interests (Minority Interests) in the first quarter of 2005.

The following table presents the Operating Partnership’s issued and outstanding Junior Convertible Preference Units (the “Junior Preference Units”) as of December 31, 2004 and December 31, 2003:

			Annual
	Redemption Date	Conversion Rate	Dividend Rate per Unit (3)		Amounts in thousands
					December 31, 2004		December 31, 2003
Junior Preference Units:
Series A Junior Convertible Preference Units; liquidation value $100 per unit; 0 and 20,333 units issued andoutstanding at December 31, 2004 and December 31, 2003, respectively	(1)(4)	4.0816	$	5.469344	$	—	$	2,033
Series B Junior Convertible Preference Units; liquidation value $25 per unit; 7,367 units issued and outstanding at December 31, 2004 and December 31, 2003	(2)	(2)	$	2.000000	184		184
					$	184	$	2,217

(1)On the fifth anniversary of the respective issuance (the “Redemption Date”), the Series A Junior Preference Units shall be automatically converted into OP Units based upon the conversion rate.  Prior to the Redemption Date, the Operating Partnership or the holders may elect to convert the Series A Junior Preference Units to OP Units under certain circumstances based upon the conversion rate.

(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 conversion rate is based upon

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a ratio dependent upon the closing price of EQR’s Common Shares.

(3)Dividends on both series of Junior Preference Units are payable quarterly at various pay dates.

(4)On December 22, 2003, 36,283 Series A Junior Preference Units with a liquidation value of $3.6 million issued on December 22, 1998 automatically converted to 148,092 OP Units.  On June 29, 2004, 20,333 Series A Junior Preference Units with a liquidation value of $2.0 million issued on June 29, 1999 automatically converted to 82,977 OP Units.

4.Real Estate

The following table summarizes the carrying amounts for investment in real estate (at cost) as of December 31, 2004 and 2003 (Amounts are in thousands):

	2004			2003
Land	$	2,183,818		$	1,845,547
Buildings and Improvements	11,667,787			10,415,679
Furniture, Fixtures and Equipment	683,113			602,647
Construction in Progress (excluding land)	160,986			2,960
Construction in Progress (land)	156,917			7,546
Real Estate	14,852,621			12,874,379
Accumulated Depreciation	(2,599,827		)	(2,296,013		)
Real Estate, net	$	12,252,794		$	10,578,366

During the year ended December 31, 2004, the Company acquired the entire equity interest in twenty-four properties containing 6,182 units from unaffiliated parties, inclusive of four additional units at two existing properties and a vacant land parcel, for a total purchase price of $913.2 million.

During the year ended December 31, 2004, the Company also acquired the majority of the remaining third party equity interests it did not previously own in nineteen properties and two vacant land parcels.  These properties were previously accounted for under the equity method of accounting and subsequent to each purchase were consolidated.  The Company recorded $960.3 million in investment in real estate and the following:

•Assumed $274.8 million in mortgage debt;

•Recorded $0.4 million of minority interests in partially owned properties;

•Reduced investments in unconsolidated entities by $608.7 million (inclusive of $339.7 million in mortgage debt paid off prior to closing);

•Assumed $27.2 million of other liabilities net of other assets acquired; and

•Paid cash of $49.2 million (net of cash acquired).

As previously noted, the Company adopted FIN No. 46, as required, effective March 31, 2004.  The adoption required the consolidation of all previously unconsolidated development projects.  Accordingly, the Company consolidated five completed properties, six projects which were under development at the time and various other vacant land parcels held for future development.  The Company recorded $548.3 million in investment in real estate and the following:

•Consolidated $294.7 million in mortgage debt;

•Recorded $3.0 million of minority interests in partially owned properties;

•Reduced investments in unconsolidated entities by $235.0 million;

•Consolidated $19.2 million of other liabilities net of other assets acquired; and

•Consolidated $3.6 million of cash.

F-25

During the year ended December 31, 2003, the Company acquired the entire equity interest in seventeen properties containing 5,200 units from unaffiliated parties, inclusive of two additional units at an existing property, for a total purchase price of $684.1 million.

During the year ended December 31, 2003, the Company also acquired the majority of the remaining third party equity interests it did not previously own in eleven properties.  These properties were previously accounted for under the equity method of accounting and subsequent to each purchase were consolidated.  The Company recorded $111.1 million in investment in real estate and the following:

•Assumed $51.6 million in mortgage debt;

•Issued 153,851 OP Units having a value of $4.2 million;

•Recorded $42,000 of minority interests in partially owned properties;

•Reduced investments in unconsolidated entities by $34.9 million;

•Assumed $27.2 million of other liabilities net of other assets acquired; and

•Consolidated and/or received net cash of $6.9 million.

During the year ended December 31, 2004, the Company disposed of the following to unaffiliated parties (including two vacant land parcels and various individual condominium units) (sales price in thousands):

	Properties	Units	Sales Price
Wholly Owned Properties	48	12,984	$	847.5
Partially Owned Properties (Consolidated)	6	1,655	138.6
Unconsolidated Properties	4	497	6.9
	58	15,136	$	993.0

The Company recognized a net gain on sales of discontinued operations of approximately $323.9 million and a net gain on sales of unconsolidated entities of approximately $4.6million on the above sales.

During the year ended December 31, 2003, the Company disposed of the following to unaffiliated parties (including various individual condominium units) (sales price in thousands):

	Properties	Units	Sales Price
Wholly Owned Properties	91	22,698	$	1,190.5
Partially Owned Properties (Consolidated)	3	465	13.6
Unconsolidated Properties	2	323	13.9
	96	23,486	$	1,218.0

The Company recognized a net gain on sales of discontinued operations of approximately $310.7 million and a net gain on sales of unconsolidated entities of approximately $4.9million on the above sales.

5.Commitments to Acquire/Dispose of Real Estate

As of February 2, 2005, in addition to the properties that were subsequently acquired as discussed in Note 21, the Company had entered into separate agreements to acquire three multifamily properties containing 827 units from unaffiliated parties.  The Company expects a combined purchase price of approximately $90.0 million.

As of February 2, 2005, in addition to the properties that were subsequently disposed of as discussed in Note 21, the Company had entered into separate agreements to dispose of seventeen multifamily properties containing 4,638units and two vacant land parcels to unaffiliated parties.  The

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Company expects a combined disposition price of approximately $324.7 million.

The closings of these pending transactions are subject to certain contingencies and conditions, therefore, there can be no assurance that these transactions will be consummated or that the final terms thereof will not differ in material respects from those summarized in the preceding paragraphs.

6.Investments in Unconsolidated Entities

The Company has co-invested in various properties with unrelated third parties which are accounted for under the equity method of accounting.  The following table summarizes the Company’s investments in unconsolidated entities as of December 31, 2004 (amounts in thousands except for project and unit amounts):

	Institutional Joint Ventures			Lexford/ Other			Totals
Total projects	45			12			57		(1)
Total units	10,846			1,571			12,417		(1)
Company’s ownership percentage of outstanding debt	25.0		%	11.0		%
Company’s share of outstanding debt (2)	$	121,200		$	3,179		$	124,379

(1)Totals exclude Fort Lewis Military Housing consisting of one property and 3,801 units, which is not accounted for under the equity method of accounting, but is included in the Company’s property/unit counts at December 31, 2004.

(2)All debt is non-recourse to the Company.

7.Deposits - Restricted

The following table presents the deposits – restricted as of December 31, 2004 and 2003 (amounts in thousands):

	2004		2003
Collateral enhancement for partially owned development loans	$	12,000	$	44,000
Tax–deferred (1031) exchange proceeds	—		27,731
Resident security, utility and other	70,194		62,021
Totals	$	82,194	$	133,752

8.Mortgage Notes Payable

As of December 31, 2004, the Company had outstanding mortgage indebtedness of approximately $3.2 billion.

During the year ended December 31, 2004, the Company:

•Repaid $494.9 million of mortgage loans;

F-27

•Assumed/consolidated $665.4 million of mortgage debt on certain properties in connection with their acquisitions and/or consolidations;

•Obtained $467.5 million of mortgage loans on certain properties;

•Was released from $29.5 million of mortgage debt assumed by the purchaser on disposed properties; and

•Refinanced $130.0 million of mortgage notes and obtained the release of the property as collateral for the loan; therefore the loan was reclassified to notes, net.

As of December 31, 2004, scheduled maturities for the Company’s outstanding mortgage indebtedness were at various dates through January 1, 2035.  At December 31, 2004, the interest rate range on the Company’s mortgage debt was 1.89%to 12.465%.  During the year ended December 31, 2004, the weighted average interest rate on the Company’s mortgage debt was 5.46%.

The historical cost, net of accumulated depreciation, of encumbered properties was $4.4 billion and $3.8 billion at December 31, 2004 and 2003, 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
2005	$	173,303
2006	287,427
2007	294,470
2008	496,939
2009	540,251
Thereafter	1,374,349
Total	$	3,166,739

As of December 31, 2003, the Company had outstanding mortgage indebtedness of approximately $2.7 billion.

During the year ended December 31, 2003, the Company:

•Repaid $432.9 million of mortgage loans;

•Assumed $141.1 million of mortgage debt on certain properties in connection with their acquisitions and/or consolidations;

•Obtained $111.2 million of mortgage loans on certain properties; and

•Was released from $53.3 million of mortgage debt assumed by the purchaser on disposed properties.

As of December 31, 2003, scheduled maturities for the Company’s outstanding mortgage indebtedness were at various dates through November 1, 2033.  At December 31, 2003, the interest rate range on the Company’s mortgage debt was 1.06%to 12.465%.  During the year ended December 31, 2003, the weighted average interest rate on the Company’s mortgage debt was 5.80%.

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, 2004 and 2003, respectively:

F-28

December 31, 2004 (Amounts are in thousands)	Net Principal Balance		Interest Rate Ranges	Weighted Average Interest Rate		Maturity Date Ranges
Fixed Rate Public Notes	$	3,031,677	4.75% - 7.75%	6.25	%	2005 - 2026
Fixed Rate Tax-Exempt Bonds	111,390		4.75% - 5.20%	5.07	%	2028 - 2029
Totals	$	3,143,067

December 31, 2003 (Amounts are in thousands)	Net Principal Balance		Interest Rate Ranges	Weighted Average Interest Rate		Maturity Date Ranges
Fixed Rate Public Notes	$	2,528,894	4.86% - 7.75%	6.63	%	2004 - 2026
Fixed Rate Tax-Exempt Bonds	127,780		4.75% - 5.20%	5.07	%	2028 - 2029
Totals	$	2,656,674

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, 2004 and 2003.

In June 2003, the Operating Partnership filed and the SEC declared effective a Form S-3 registration statement to register $2.0 billion of debt securities.  In addition, the Operating Partnership carried over $280.0 million related to a prior registration statement.  As of December 31, 2004, $1.48 billion in debt securities remained available for issuance under this registration statement.

During the year ended December 31, 2004, the Company:

•Issued $300.0 million of five-year 4.75% fixed-rate public notes, receiving net proceeds of $296.8 million;

•Issued $500.0 million of ten-year 5.25% fixed rate public notes, receiving net proceeds of $496.1 million;

•Repaid $415.0 million of fixed rate public notes at maturity;

•Repaid $20.7 million of other unsecured notes; and

•Obtained an unsecured floating rate loan with a total commitment of $300.0 million and an initial borrowing of $100.0 million on July 15, 2004.  This loan was paid off in full and terminated on September 14, 2004.

During the year ended December 31, 2003, the Company:

•Issued $400.0 million of ten-year 5.20% fixed-rate public notes, receiving net proceeds of $397.5 million;

•Repaid $100.0 million of floating rate public notes at maturity;

•Repaid $50.0 million and $40.0 million of 6.65% and 6.875%, respectively, fixed rate public notes at maturity; and

•Repaid $4.5 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):

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Year	Total
2005 (1)	$	494,594
2006 (2)	204,190
2007	154,620
2008	130,000
2009	297,764
Thereafter	1,861,899
Total	$	3,143,067

(1)Includes $300.0 million with a final maturity of 2015 that is putable/callable in 2005.

(2)Includes $150.0 million with a final maturity of 2026 that is putable in 2006.

10.Line of Credit

On May 30, 2002, the Operating Partnership obtained a three-year $700.0 million unsecured revolving credit facility maturing May 29, 2005.  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 upon bids received from the lending group.  EQR has guaranteed the Operating Partnership’s line of credit up to the maximum amount and for the full term of the facility.

As of December 31, 2004 and 2003, $150.0 million and $10.0 million, respectively, was outstanding and $65.4 million and $56.7 million, respectively, was restricted (dedicated to support letters of credit and not available for borrowing) on the credit facility.  During the years ended December 31, 2004 and 2003, the weighted average interest rate was 1.73% and 1.85%, respectively.

11.Derivative Instruments

The following table summarizes the consolidated derivative instruments at December 31, 2004 (dollar amounts are in thousands):

	Cash Flow Hedges			Fair Value Hedges			Offsetting Receive Floating Swaps/Caps			Offsetting Pay Floating Swaps/Caps			Development Cash Flow Hedges
Current Notional Balance	$	150,000		$	490,000		$	255,069		$	255,069		$	4,682
Lowest Possible Notional	$	150,000		$	490,000		$	91,052		$	91,052		$	6,700
Highest Possible Notional	$	150,000		$	490,000		$	255,069		$	255,069		$	34,625
Lowest Interest Rate	3.683		%	3.245		%	6.000		%	6.000		%	3.310		%
Highest Interest Rate	3.683		%	7.250		%	6.000		%	6.000		%	3.500		%
Earliest Maturity Date	2005			2005			2007			2007			2005
Latest Maturity Date	2005			2009			2007			2007			2006
Estimated Asset (Liability) Fair Value	$	(1,780	)	$	(6,137	)	$	28		$	(28	)	$	(15	)

During the year ended December 31, 2004, the Company paid approximately $3.3 million to terminate five interest rate swaps in conjunction with the repayment of the underlying mortgage loans.  The Company recognized a $1.9 million loss in connection with these terminations (included in loss from investments in unconsolidated entities as the losses occurred prior to the acquisition and/or consolidation of the respective properties – see further discussion in Notes 2 and 4).  The Company also paid approximately $0.5 million to terminate two forward starting swaps in conjunction with the issuance of $300.0 million of five-year unsecured notes.  The $0.5 million cost has been deferred and will be recognized as additional interest expense over the five-year life of the unsecured notes.  The Company also paid approximately $3.5 million to terminate ten forward starting swaps in conjunction with the issuance of $500.0 million of ten-year unsecured notes.  Approximately $3.3 million of the $3.5 million cost has been deferred and will be recognized as additional interest expense over the ten-year life of the

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unsecured notes.

On December 31, 2004, the net derivative instruments were reported at their fair value as other assets of approximately $1.3 million and as other liabilities of approximately $9.2 million.  As of December 31, 2004, there were approximately $21.0 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, 2004, the Company may recognize an estimated $4.5 million of accumulated other comprehensive loss as additional interest expense during the twelve months ending December 31, 2005.

12.Earnings Per Share

The following tables set forth the computation of net income per share – basic and net income per share – diluted:

	Year Ended December 31,
	2004			2003			2002
	(Amounts in thousands except per share amounts)
Numerator for net income per share – basic:
Income from continuing operations	$	135,276		$	157,867		$	188,114
Preferred distributions	(53,746		)	(76,435		)	(76,615		)
Premium on redemption of Preferred Shares	—			(20,237		)	—
Allocation of Minority Interests – Operating Partnership to discontinued operations	23,391			27,445			16,269
Income from continuing operations available to Common Shares, net of allocation of Minority Interests – Operating Partnership	104,921			88,640			127,768
Net gain on sales of discontinued operations, net of allocation of Minority Interests – Operating Partnership	301,445			287,372			96,317
Discontinued operations, net of allocation of Minority Interests – Operating Partnership	12,217			50,627			100,077
Numerator for net income per share – basic	$	418,583		$	426,639		$	324,162

F-31

	Year Ended December 31,
	2004			2003			2002
	(Amounts in thousands except per share amounts)
Numerator for net income per share – diluted:
Income from continuing operations	$	135,276		$	157,867		$	188,114
Preferred distributions	(53,746		)	(76,435		)	(76,615		)
Premium on redemption of Preferred Shares	—			(20,237		)	—
Effect of dilutive securities:
Allocation to Minority Interests – Operating Partnership	31,228			34,658			26,862
Income from continuing operations available to Common Shares	112,758			95,853			138,361
Net gain on sales of discontinued operations	323,925			310,706			104,296
Discontinued operations, net	13,128			54,738			108,367
Numerator for net income per share – diluted	$	449,811		$	461,297		$	351,024
Denominator for net income per share – basic and diluted:
Denominator for net income per share – basic	279,744			272,337			271,974
Effect of dilutive securities:
OP Units	20,939			22,186			22,663
Share options/restricted shares	3,188			2,518			3,332
Denominator for net income per share – diluted	303,871			297,041			297,969
Net income per share – basic	$	1.50		$	1.57		$	1.19
Net income per share – diluted	$	1.48		$	1.55		$	1.18
Net income per share – basic:
Income from continuing operations available to Common Shares	$	0.38		$	0.33		$	0.47
Net gain on sales of discontinued operations	1.08			1.05			0.35
Discontinued operations, net	0.04			0.19			0.37
Net income per share – basic	$	1.50		$	1.57		$	1.19
Net income per share – diluted:
Income from continuing operations available to Common shares	$	0.37		$	0.32		$	0.46
Net gain on sales of discontinued operations	1.07			1.05			0.35
Discontinued operations, net	0.04			0.18			0.37
Net income per share – diluted	$	1.48		$	1.55		$	1.18

Convertible preferred shares/units that could be converted into 3,215,472, 14,745,904 and 15,335,977 weighted average Common Shares for the years ended December 31, 2004, 2003 and 2002, respectively, were outstanding but 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.

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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).

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, 2004, 2003, and 2002.

	Year Ended December 31,
	2004			2003			2002
	(Amounts in thousands)
REVENUES
Rental income	$	61,790		$	219,370		$	338,729
Furniture income	—			—			1,361
Total revenues	61,790			219,370			340,090
EXPENSES (1)
Property and maintenance	27,977			77,233			101,097
Real estate taxes and insurance	7,009			23,611			34,016
Property management	111			103			162
Depreciation	12,374			56,571			83,376
Furniture expenses	—			—			1,303
Total expenses	47,471			157,518			219,954
Discontinued operating income	14,319			61,852			120,136
Interest and other income	260			322			83
Interest (2):
Expense incurred, net	(898		)	(6,346		)	(11,600		)
Amortization of deferred financing costs	(553		)	(1,090		)	(252		)
Discontinued operations, net	$	13,128		$	54,738		$	108,367

(1)Includes expenses paid in the current period for properties sold in prior periods related to the Company’s period of ownership.

(2)Interest includes only specific amounts from each property sold.

For the properties sold during 2004 (excluding condominium conversion properties), the investment in real estate, net of accumulated depreciation, and the mortgage notes payable balances at December 31, 2003 were $500.0 million and $94.9 million, respectively.

On January 11, 2002, the Company disposed of its furniture rental business for $30.0 million in cash and received net proceeds of $28.7 million.  After giving effect to a previously recorded impairment loss, no gain/loss on sale was recognized as the net book value at the sale date approximated the sales price.

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

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the first day of each calendar year.  As of January 1, 2005, this amount equaled 23,069,873, of which 17,683,625 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, key employees and consultants of the Company may be offered the opportunity to acquire Common Shares through the grant of share options (“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.  Additionally, officers and key employees of the Company may be awarded Common Shares, subject to conditions and restrictions as described in the Share Incentive Plans.  Finally, certain executive officers of the Company are subject to 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 generally are granted at the fair market value of the Company’s Common Shares at the date of grant, vest 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 shall not be less than 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 thereof.

As to the Options that have been granted through December 31, 2004, generally, one-third are exercisable one year after the initial grant, one-third are exercisable two years following the date such Options were granted and the remaining one-third are exercisable three years following the date such Options were granted.

As to the restricted shares that have been awarded through December 31, 2004, these shares generally vest three years from the award date.  During the three-year period of restriction, the employee receives quarterly dividend payments on their shares.  The Company’s unvested restricted shareholders receive dividends 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 distribution in excess of accumulated earnings 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 canceled.

In addition, each year the Company’s executive officers receive performance-based awards.  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”).

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If the Company’s Average	Less														Greater
Annual Return exceeds	than														than
the T-Note Rate by:	0.99	%	1-1.99	%	2	%	3	%	4	%	5	%	6	%	7	%
Then the executive officer will receive
Common Shares equal to the
target number of awards times the
following %:	0	%	50	%	100	%	115	%	135	%	165	%	190	%	225	%

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 table summarizes information regarding both the restricted and performance-based share plans for the three years ended December 31, 2004, 2003 and 2002:

	Restricted/ Performance Share Awards	Weighted Average		Compensation Expense
Year	Granted, Net of Cancellations	Grant Price		General and Administrative		Property Management		Dividends Incurred
2004	515,622	$	29.28	$	6.3 million	$	6.2 million	$	2.5 million
2003	900,555	$	23.58	$	5.5 million	$	5.6 million	$	2.5 million
2002	885,967	$	27.22	$	16.2 million	$	9.6 million	$	2.9 million

Prior to 2003, the Company had chosen to account for its stock-based compensation in accordance with APB No. 25, Accounting for Stock Issued to Employees,which resulted in no compensation expense for options issued with an exercise price equal to or exceeding the market value of the Company’s Common Shares on the date of grant (intrinsic method).  The Company has elected to account for its stock-based compensation in accordance with SFAS No. 123 and its amendment (SFAS No. 148), Accounting for Stock Based Compensation, effective in the first quarter of 2003, which resulted in compensation expense being recorded based on the fair value of the stock compensation granted.

Compensation expense related to restricted and performance-based share grants was previously recognized in accordance with APB No. 25.  The adoption of SFAS No. 123 does not significantly change the amount of compensation expense recognized for these grants.

See Note 2 for additional information regarding the Company’s stock-based compensation.

The table below summarizes the Option activity of the Share Incentive Plans and options assumed in connection with mergers (the “Merger Options”) for the three years ended December 31, 2004, 2003 and 2002:

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	Common Shares Subject to Options		Weighted Average Exercise Price Per Option
Balance at December 31, 2001	12,165,247		$	22.59
Options granted	2,270,220		$	27.24
Options exercised	(1,425,494	)	$	20.36
Merger Options exercised	(13,621	)	$	19.66
Options canceled	(177,536	)	$	24.90
Balance at December 31, 2002	12,818,816		$	23.63
Options granted (1993 plan)	665,304		$	23.55
Options granted (2002 plan)	2,217,124		$	23.59
Options exercised (1993 plan)	(2,696,110	)	$	20.61
Options exercised (2002 plan)	(500,000	)	$	23.55
Merger Options exercised	(52,995	)	$	19.55
Options canceled (1993 plan)	(324,298	)	$	25.08
Options canceled (2002 plan)	(42,242	)	$	23.55
Balance at December 31, 2003	12,085,599		$	24.27
Options granted (2002 plan)	2,254,570		$	29.33
Options exercised (1993 plan)	(2,920,057	)	$	23.75
Options exercised (2002 plan)	(423,866	)	$	23.55
Merger Options exercised	(6,836	)	$	20.14
Options canceled (1993 plan)	(90,436	)	$	23.44
Options canceled (2002 plan)	(79,751	)	$	28.02
Balance at December 31, 2004	10,819,223		$	25.48

The following table summarizes information regarding options outstanding at December 31, 2004:

	Options Outstanding
Range of Exercise Prices	Options	Weighted Average Remaining Contractual Life in Years	Weighted Average Exercise Price		Options Exercisable
					Options	Weighted Average Exercise Price
$6.68 to $10.01	92	2.0	$	9.55	92	$	9.55
$10.01 to $13.35	1,892	1.1	$	12.12	1,892	$	12.12
$13.35 to $16.69	305,634	1.1	$	15.33	305,634	$	15.33
$16.69 to $20.03	6,018	4.2	$	18.63	6,018	$	18.63
$20.03 to $23.37	1,554,006	4.1	$	20.76	1,554,006	$	20.76
$23.37 to $26.70	3,998,492	5.8	$	24.67	2,739,319	$	25.18
$26.70 to $30.04	4,864,462	7.8	$	28.19	2,244,481	$	27.45
$30.04 to $33.38	88,627	9.6	$	31.38	—	—
$6.68 to $33.38	10,819,223	6.4	$	25.48	6,851,442	$	24.47

As of December 31, 2003 and 2002, 8,274,915 Options (with a weighted average exercise price of $23.86) and 8,252,203 Options (with a weighted average exercise price of $22.25) were exercisable, respectively.

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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 4,770,937 Common Shares available for purchase under the ESPP at December 31, 2004.  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,
	2004	2003	2002
	(amounts in thousands except share and per share amounts)
Shares issued	275,616	289,274	324,238
Issuance price ranges	$23.35 – $27.39	$20.64 – $24.74	$21.65 – $24.43
Issuance proceeds	$6,853	$6,324	$7,377

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 2% of eligible compensation that a participant contributes to the 401(k) Plan (4% for 2002 and prior years).  Participants are vested in the Company’s contributions over five years.  The Company made contributions in the amount of $1.5 million and $3.5 million for the years ended December 31, 2003 and 2002, respectively, and expects to make contributions in the amount of approximately $2.0 million for the year ended December 31, 2004.

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 did not make a contribution for the years ended December 31, 2004, 2003 or 2002.

The Company established a supplemental executive retirement savings 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 11,571,446 Common Shares available for issuance under the DRIP Plan at December 31, 2004.

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 Shares less a discount ranging between 0% and 5%, as determined in accordance with the DRIP Plan (which

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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 $0.2 million, $0.3 million and $0.7 million for the years ended December 31, 2004, 2003 and 2002, respectively.

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.  Amounts incurred were approximately $0.3 million, $0.2 million and $0.5 million for the years ended December 31, 2004, 2003 and 2002, respectively.

The Company leases its corporate headquarters from an entity controlled by EQR’s Chairman of the Board of Trustees.  Amounts incurred for such office space for the years ended December 31, 2004, 2003 and 2002, respectively, were approximately $1.9 million, $1.7 million and $1.6 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 leased space in an office building in Augusta, Georgia indirectly owned by one of EQR’s 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).  Amounts incurred for such office space were approximately $0.2 million, $0.2 million and $0.1 million for the years ended December 31, 2004, 2003 and 2002, respectively;

•Certain executive officers of the Company purchased Common Shares which were financed with loans made by the Company, all of which were repaid in full in 2002;

•The Company made consulting payments to two former trustees (individuals were trustees through May 2003) of approximately $0.2 million during the year ended December 31, 2002; and

•The Company paid legal fees to a law firm of which one of EQR’s former trustees (individual was a trustee through May 2002) is a partner of approximately $0.3 million during the year ended December 31, 2002.

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.

In August 2004, the Company tried a class action lawsuit in Palm Beach County, Florida regarding certain charges made to residents who terminated their leases early or failed to provide sufficient notice of intent to vacate.  In December 2004, the Court issued a Findings of Fact and Conclusions of Law holding those fees legally uncollectible under Florida law. In recognition of the Findings of Fact and Conclusions of Law, which awarded damages and interest to the class in the amount of approximately $1.6 million, the Company established a reserve of approximately $1.6 million and correspondingly recorded this as a general and administrative expense.  Due to pending appeals, the award is neither final nor enforceable.  Accordingly, it is not possible to determine or predict the ultimate outcome of the case.  While no assurances can be given, the Company does not believe that this lawsuit,

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if the ultimate outcome is unfavorable, will have a material adverse effect on the Company.

The Company does not believe there is any other litigation pending or threatened against the Company which, individually or in the aggregate, reasonably may be expected to have a material adverse effect on the Company.

During the year ended December 31, 2004, the Company established a reserve and recorded a corresponding expense of $15.2 million in estimated uninsured property damage at certain of its properties primarily located in Florida caused by Hurricanes Charley, Frances, Ivan and Jeanne (included in rents received in advance and other liabilities and real estate taxes and insurance expense on the consolidated balance sheets and statements of operations, respectively).  Of this amount, approximately $9.4 million had been spent for hurricane related repairs through December 31, 2004.

As of December 31, 2004 the Company has five projects totaling 1,306 unitsin various stages of development with estimated completion dates ranging through September 30, 2006. The three 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 subject to the agreement, 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.  In connection with this development agreement, the Company has an obligation to provide up to $40.0 million in credit enhancements to guarantee a portion of the third party construction financing.  As of February 2, 2005, the Company had set-aside $5.0 million towards this credit enhancement.  The Company would be required to perform under this agreement only if there was a material default under a third party construction mortgage agreement.  This agreement expires no later than December 31, 2018.  Notwithstanding the termination of the agreement, the Company shall have recourse against its development partner for any losses incurred.

•The second development partner has the right, at any time following completion of a project subject to the agreement, to require the Company to purchase the partners’ 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 connection with one of its mergers, the Company provided a guaranty of a credit enhancement agreement with respect to certain tax-exempt bonds issued to finance certain public improvements at a multifamily development project.  The Company has the obligation to provide this guaranty for a period of eight years from the consummation of the merger or through May 2005.  The Company would be required

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to perform under this agreement only if there was a draw on the letter of credit issued by the credit enhancement party.  The counterparty has also agreed to indemnify the Company for any losses suffered.  As of December 31, 2004, this guaranty was still in effect at a commitment amount of $12.7 million (reduced to $10.4 million effective in January 2005) and no current outstanding liability.

During the years ended December 31, 2004, 2003 and 2002, total operating lease payments incurred for office space, including a portion of real estate taxes, insurance, repairs and utilities, aggregated $5.8 million, $5.7 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 two of its executive officers and its former chief executive officer.  During the years ended December 31, 2004, 2003 and 2002, the Company recognized compensation expense of $39,000, $3.0 million and $5.1 million, respectively, related to these agreements.

The following table summarizes the Company’s contractual obligations for minimum rent payments under operating leases and deferred compensation for the next five years and thereafter as of December 31, 2004:

	Payments Due by Year (in thousands)
	2005		2006		2007		2008		2009		Thereafter		Total
Operating Leases:
Minimum Rent Payments (a)	$	4,816	$	4,205	$	3,464	$	3,335	$	3,233	$	7,369	$	26,422
Other Long-Term Liabilities:
Deferred Compensation (b)	813		1,807		2,211		2,211		2,211		11,230		20,483

(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, former CEO and two other executive officers based on planned retirement dates.

19.Asset Impairment

The Company recorded approximately $1.2 million of asset impairment charges related to its technology investments in each of the years ending December 31, 2003 and 2002. These charges were the result of a review of the existing investments reflected on the consolidated balance sheet.  These impairment losses are reflected on the consolidated statements of operations in total expenses and include the write-down of assets classified as other assets.

For the year ended December 31, 2002, the Company recorded approximately $17.1 million of asset impairment charges related to its corporate housing business.  Following the guidance in SFAS No. 142, these charges were the result of the Company’s decision to reduce the carrying value of its corporate housing business to $30.0 million, given the weakness in the economy and management’s expectations for near-term performance.  This impairment loss is reflected on the consolidated statements of operations as impairment on corporate housing business and on the consolidated balance sheets as a reduction in goodwill, net.

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

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apartment units to residents and includes Equity Corporate Housing (“ECH”).  Senior management evaluates the performance of each of our apartment communities on an individual basis; however, each of our apartment communities has similar economic characteristics, residents, and products and services so they have been aggregated into one reportable segment.  The Company’s rental real estate segment comprises approximately 99.4%, 99.2% and 99.4% of total revenues for the years ended December 31, 2004, 2003 and 2002, respectively.  The Company’s rental real estate segment comprises approximately 99.8% and 99.7% of total assets at December 31, 2004 and 2003, respectively.

The primary financial measure for the Company’s rental real estate segment 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 the NOI from our rental real estate specific to continuing operations for the years ended December 31, 2004, 2003 and 2002, respectively:

	Year Ended December 31,
	2004				2003			2002
	(Amounts in thousands)
Rental income	$		1,878,262		$	1,691,647		$	1,677,459
Property and maintenance expense	(520,412			)	(460,426		)	(427,960		)
Real estate taxes and insurance expense	(222,448			)	(184,483		)	(170,029		)
Property management expense	(75,888			)	(68,058		)	(72,416		)
Net operating income	$	1,059,514			$	978,680		$	1,007,054

The Company’s fee and asset management activity is immaterial and does not meet the threshold requirements of a reportable segment as provided for in SFAS No. 131.

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, 2004, 2003 or 2002.

21.Subsequent Events/Other

Subsequent to December 31, 2004 and through February 7, 2005, the Company:

•Acquired four properties consisting of 734 units and one parcel of vacant land for approximately $144.1 million;

•Disposed of one property consisting of 450 units (excluding condominium units) and a vacant land parcel for approximately $340.9 million;

•Assumed $47.6 million of mortgage debt on two properties in connection with their acquisitions;

•Executed an amended compensation agreement with its Chairman of the Board of Trustees extending his current agreement on the same terms and conditions for two more years through 2006 and providing him with a $3.25 million per year long-term compensation grant of options and restricted shares; and

•Issued irrevocable notices to redeem for cash during March 2005 all 1,320,000 units of its 8.50% Series B and C Preference Interests with a cumulative liquidation value of $66.0 million.

On February 24, 2005, the Company received $57.1 million in cash for its ownership interest in Rent.com in connection with the acquisition of Rent.com by eBay, Inc.

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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.  Amounts are in thousands, except for per share amounts.

2004	Fourth Quarter 12/31		Third Quarter 9/30		Second Quarter 6/30		First Quarter 3/31
Total revenues (1)	$	487,366	$	483,481	$	474,727	$	443,927
Operating income (1)	135,952		121,612		136,148		132,973
Income from continuing operations (1)	33,303		26,185		39,483		36,305
Net gain on sales of discontinued operations	116,272		58,394		77,760		71,499
Discontinued operations, net (1)	1,058		2,930		4,963		4,177
Net income (1)*	150,633		87,509		122,206		111,981
Net income available to Common Shares	137,558		74,163		108,553		98,309
Earnings per share – basic:
Net income available to Common Shares	$	0.49	$	0.26	$	0.39	$	0.35
Weighted average Common Shares outstanding	282,329		280,167		278,949		277,498
Earnings per share – diluted:
Net income available to Common Shares	$	0.48	$	0.26	$	0.39	$	0.35
Weighted average Common Shares outstanding	306,841		304,028		302,201		301,781

(1)The amounts presented for the first three quarters of 2004 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 2004 and the Company’s reclassification of its Minority Interest distributions on Preference Interests and Junior Preference Units.  Below is a reconciliation to the amounts previously reported in the respective Form 10-Q’s:

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2004	Third Quarter  9/30			Second Quarter 6/30			First Quarter 3/31
Total revenues previously reported in Form 10-Q	$	491,485		$	488,596		$	462,661
Total revenues subsequently reclassified to discontinued operations	(8,004		)	(13,869		)	(18,734		)
Total revenues disclosed in Form 10-K	$	483,481		$	474,727		$	443,927
Operating income previously reported in Form 10-Q	$	124,371		$	140,786		$	139,316
Operating income subsequently reclassified to discontinued operations	(2,759		)	(4,638		)	(6,343		)
Operating income disclosed in Form 10-K	$	121,612		$	136,148		$	132,973
Income from continuing operations previously reported in Form 10-Q	$	29,003		$	49,363		$	47,381
Income from continuing operations subsequently reclassified to discontinued operations	(2,818		)	(4,796		)	(5,992		)
Preference Interest distributions reclassified to Minority Interests	—			(5,053		)	(5,053		)
Junior Preference Unit distributions reclassified to Minority Interests	—			(31		)	(31		)
Income from continuing operations disclosed in Form 10-K	$	26,185		$	39,483		$	36,305
Discontinued operations, net previously reported in Form 10-Q	$	112		$	167		$	(1,815	)
Discontinued operations, net from properties sold subsequent to the respective reporting period	2,818			4,796			5,992
Discontinued operations, net disclosed in Form 10-K	$	2,930		$	4,963		$	4,177
Net income previously reported in Form 10-Q	$	87,509		$	127,290		$	117,065
Preference Interest distributions reclassified to Minority Interests	—			(5,053		)	(5,053		)
Junior Preference Unit distributions reclassified to Minority Interests	—			(31		)	(31		)
Net income disclosed in Form 10-K	$	87,509		$	122,206		$	111,981

2003	Fourth Quarter 12/31		Third Quarter 9/30		Second Quarter 6/30		First Quarter 3/31
Total revenues (2)	$	430,692	$	430,248	$	426,229	$	418,851
Operating income (2)	126,992		134,351		138,414		130,507
Income from continuing operations (2)	29,765		42,093		45,086		40,923
Net gain on sales of discontinued operations	91,731		77,983		70,320		70,672
Discontinued operations, net (2)	8,206		12,063		15,851		18,618
Net income (2)*	129,702		132,139		131,257		130,213
Net income available to Common Shares	90,743		112,575		112,154		111,167
Earnings per share – basic:
Net income available to Common Shares	$	0.33	$	0.41	$	0.41	$	0.41
Weighted average Common Shares outstanding	274,457		272,787		271,380		270,678
Earnings per share – diluted:
Net income available to Common Shares	$	0.33	$	0.41	$	0.41	$	0.41
Weighted average Common Shares outstanding	299,516		297,941		296,084		294,508

(2)The amounts presented for the four quarters of 2003 are not equal to the same amounts previously reported in the respective Form 10-Q’s/10-K filed with the SEC for each period as a result of changes in discontinued operations due to additional property sales which occurred throughout 2004 and 2003 and the Company’s reclassification of

F-43

its Minority Interest distributions on Preference Interests and Junior Preference Units.  Below is a reconciliation to the amounts previously reported in the respective Form 10-Q’s/10-K:

2003	Fourth Quarter 12/31			Third Quarter 9/30			Second Quarter 6/30			First Quarter 3/31
Total revenues previously reported in Form 10-Q/10-K	$	459,521		$	472,976		$	479,357		$	482,707
Total revenues subsequently reclassified to discontinued operations	(28,829		)	(42,728		)	(53,128		)	(63,856		)
Total revenues disclosed in Form 10-K	$	430,692		$	430,248		$	426,229		$	418,851
Operating income previously reported in Form 10-Q/10-K	$	136,057		$	147,635		$	155,638		$	151,039
Operating income subsequently reclassified to discontinued operations	(9,065		)	(13,284		)	(17,224		)	(20,532		)
Operating income disclosed in Form 10-K	$	126,992		$	134,351		$	138,414		$	130,507
Income from continuing operations previously reported in  Form 10-Q/10-K	$	43,049		$	59,297		$	65,934		$	64,259
Income from continuing operations subsequently reclassified to discontinued operations	(8,150		)	(12,070		)	(15,714		)	(18,202		)
Preference Interest distributions reclassified to Minority Interests	(5,052		)	(5,053		)	(5,053		)	(5,053		)
Junior Preference Unit distributions reclassified to Minority Interests	(82		)	(81		)	(81		)	(81		)
Income from continuing operations disclosed in Form 10-K	$	29,765		$	42,093		$	45,086		$	40,923
Discontinued operations, net previously reported in Form 10-Q/10-K	$	56		$	(7	)	$	137		$	416
Discontinued operations, net from properties sold subsequent to the respective reporting period	8,150			12,070			15,714			18,202
Discontinued operations, net disclosed in Form 10-K	$	8,206		$	12,063		$	15,851		$	18,618
Net income previously reported in Form 10-Q/10-K	$	134,836		$	137,273		$	136,391		$	135,347
Preference Interest distributions reclassified to Minority Interests	(5,052		)	(5,053		)	(5,053		)	(5,053		)
Junior Preference Unit distributions reclassified to Minority Interests	(82		)	(81		)	(81		)	(81		)
Net income disclosed in Form 10-K	$	129,702		$	132,139		$	131,257		$	130,213

*  The Company did not have any extraordinary items or cumulative effect of change in accounting principle during the years ended December 31, 2004 and 2003.  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-44

EQUITY RESIDENTIAL

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2004

										Cost Capitalized
										Subsequent to				Gross Amount Carried										Life Used to
						Initial Cost to				Acquisition				at Close of										Compute
Description						Company				(Improvements, net) (E)				Period 12/31/04										Depreciation in
Apartment								Building &				Building &				Building &				Accumulated			Date of	Latest Income
Name	Location	Units (J)	Encumbrances			Land		Fixtures		Land		Fixtures		Land		Fixtures (A)		Total (B)		Depreciation			Construction	Statement (C)
1111 25th St	Washington, D.C.	—	$	23,535,059		$	12,454,899	$	25,970,177	$	—	$	—	$	12,454,899	$	25,970,177	$	38,425,076	$	—		(F)	30 Years
1210 Mass	Washington, D.C.	142	27,821,158			9,213,512		30,151,143		—		—		9,213,512		30,151,143		39,364,655		(274,191		)	2004	30 Years
13th and N	Washington, D.C.	54	—			2,657,016		11,034,942		—		—		2,657,016		11,034,942		13,691,958		—			2004	30 Years
1660 Peachtree	Atlanta, GA	355	23,000,000			7,987,511		23,910,026		—		1,060,358		7,987,511		24,970,384		32,957,896		(872,937		)	1999	30 Years
2300 Elliott	Seattle, WA	92	—			796,800		7,173,725		—		4,306,534		796,800		11,480,259		12,277,059		(4,630,990		)	1992	30 Years
2400 M St	Washington, D.C.	—	25,167,232			30,006,593		33,767,467		—		—		30,006,593		33,767,467		63,774,060		—			(F)	30 Years
2900 on First	Seattle, WA (G)	135	—			1,177,700		10,600,360		—		3,252,630		1,177,700		13,852,990		15,030,690		(4,858,274		)	1989-91	30 Years
71 Broadway	New York, NY (G)	238	—			22,611,600		77,491,059		—		17,666		22,611,600		77,508,725		100,120,325		(640,139		)	1997	30 Years
740 River Drive	St. Paul, MN	163	5,620,888			1,626,700		11,234,943		—		2,934,678		1,626,700		14,169,620		15,796,320		(4,278,110		)	1962	30 Years
929 House	Cambridge, MA (G)	127	4,433,715			3,252,993		21,745,595		—		1,019,069		3,252,993		22,764,664		26,017,657		(3,421,089		)	1975	30 Years
Abington Glen	Abington, MA	90	—			553,105		3,697,396		—		1,147,519		553,105		4,844,915		5,398,020		(675,611		)	1968	30 Years
Acacia Creek	Scottsdale, AZ	304	—			3,663,473		21,172,386		—		1,436,601		3,663,473		22,608,988		26,272,461		(5,982,340		)	1988-1994	30 Years
Acadia Court	Bloomington, IN	96	1,922,423			257,484		2,268,653		—		440,915		257,484		2,709,568		2,967,051		(655,602		)	1985	30 Years
Acadia Court II	Bloomington, IN	104	—			253,636		2,234,632		—		246,388		253,636		2,481,019		2,734,655		(549,827		)	1986	30 Years
Alborada	Fremont, CA	442	—			24,310,000		59,214,129		—		953,928		24,310,000		60,168,056		84,478,056		(10,051,379		)	1999	30 Years
Ambergate (FL)	W. Palm Beach, FL	72	—			730,000		1,687,743		—		196,417		730,000		1,884,160		2,614,160		(348,290		)	1987	30 Years
Amberidge	Roseville, MI	45	—			130,844		1,152,880		—		196,508		130,844		1,349,387		1,480,232		(293,306		)	1985	30 Years
Amberton	Manassas, VA	190	10,705,000			900,600		11,921,650		—		1,441,752		900,600		13,363,402		14,264,002		(3,800,871		)	1986	30 Years
Amberwood (OH)	Massillon, OH	63	813,763			126,227		1,112,289		—		245,157		126,227		1,357,446		1,483,673		(315,859		)	1987	30 Years
Amberwood I (GA) (REIT)	Cartersville, GA	56	1,332,606			140,598		1,265,995		—		34,031		140,598		1,300,026		1,440,624		(44,553		)	1985	30 Years
Amesbury I	Reynoldsburg, OH	68	1,194,940			143,039		1,260,233		—		268,395		143,039		1,528,628		1,671,668		(343,664		)	1986	30 Years
Amesbury II	Reynoldsburg, OH	81	—			180,588		1,591,229		—		209,862		180,588		1,801,091		1,981,679		(394,432		)	1987	30 Years
Amhurst (Tol)	Toledo, OH	58	—			161,854		1,426,108		—		140,650		161,854		1,566,757		1,728,611		(323,647		)	1983	30 Years
Amhurst I (OH)	Dayton, OH	73	—			152,574		1,344,353		—		287,773		152,574		1,632,126		1,784,699		(406,291		)	1979	30 Years
Amhurst II (OH)	Dayton, OH	74	—			159,416		1,404,632		—		170,307		159,416		1,574,939		1,734,356		(355,554		)	1981	30 Years
Andover Court	Mt. Vernon, OH	51	—			123,875		1,091,272		—		205,529		123,875		1,296,801		1,420,676		(308,418		)	1982	30 Years
Annhurst (IN)	Indianapolis, IN	83	1,182,819			189,235		1,667,469		—		371,544		189,235		2,039,013		2,228,248		(469,658		)	1985	30 Years
Annhurst (MD) (REIT)	Belcamp, MD	67	1,206,889			232,575		2,093,165		—		191,819		232,575		2,284,984		2,517,559		(351,881		)	1984	30 Years
Annhurst (PA)	Clairton, PA	97	—			307,952		2,713,397		—		424,751		307,952		3,138,148		3,446,101		(672,123		)	1984	30 Years
Annhurst II (OH)	Gahanna, OH	56	—			116,739		1,028,595		—		207,364		116,739		1,235,958		1,352,697		(298,899		)	1986	30 Years
Annhurst III (OH)	Gahanna, OH	52	—			134,788		1,187,629		—		141,148		134,788		1,328,777		1,463,565		(289,201		)	1988	30 Years
Apple Ridge I	Circleville, OH	59	1,008,377			139,300		1,227,582		—		304,085		139,300		1,531,667		1,670,967		(327,884		)	1987	30 Years
Apple Ridge III	Circleville, OH	30	—			72,585		639,356		—		90,856		72,585		730,211		802,797		(151,772		)	1982	30 Years
Applegate (Col)	Columbus, IN	58	—			171,829		1,514,002		—		194,147		171,829		1,708,148		1,879,977		(352,980		)	1982	30 Years
Applegate I (IN)	Muncie, IN	53	862,233			138,506		1,220,386		—		229,500		138,506		1,449,886		1,588,391		(328,383		)	1984	30 Years
Applegate II (IN)	Muncie, IN	80	1,202,296			180,017		1,586,143		—		277,758		180,017		1,863,901		2,043,918		(404,571		)	1987	30 Years
Applewood I	Deland, FL	161	2,015,004			235,230		2,072,994		—		660,149		235,230		2,733,143		2,968,373		(733,680		)	1982	30 Years
Aragon Woods	Indianapolis, IN	67	—			157,791		1,390,010		—		120,902		157,791		1,510,913		1,668,704		(331,816		)	1986	30 Years
Arbor Glen	Ypsilanti, MI	220	6,405,314			1,096,064		9,887,635		—		1,596,261		1,096,064		11,483,896		12,579,960		(3,177,003		)	1990	30 Years
Arbor Terrace	Sunnyvale, CA	174	(R		)	9,057,300		18,483,642		—		729,285		9,057,300		19,212,927		28,270,227		(4,539,215		)	1979	30 Years
Arboretum (GA)	Atlanta, GA	312	—			4,682,300		15,913,018		—		1,567,064		4,682,300		17,480,082		22,162,382		(4,883,367		)	1970	30 Years
Arboretum (MA)	Canton, MA	156	(M		)	4,685,900		10,992,751		—		765,831		4,685,900		11,758,582		16,444,482		(2,907,630		)	1989	30 Years
Arboretum at Stonelake	Austin, TX	408	—			6,120,000		24,069,023		—		662,567		6,120,000		24,731,590		30,851,590		(1,201,491		)	1996	30 Years
Arbors of Brentwood	Nashville, TN	346	—			404,670		13,536,367		—		3,042,879		404,670		16,579,246		16,983,916		(6,783,064		)	1986	30 Years
Arbors of Hickory Hollow	Antioch, TN	336	(K		)	202,985		6,937,209		—		3,114,261		202,985		10,051,470		10,254,455		(4,861,939		)	1986	30 Years
Arbors of Las Colinas	Irving, TX	408	—			1,663,900		14,977,080		—		2,797,860		1,663,900		17,774,940		19,438,840		(7,486,985		)	1984/85	30 Years
Artisan Square	Northridge, CA	140	(U		)	7,000,000		20,537,359		—		110,519		7,000,000		20,647,878		27,647,878		(1,550,633		)	2002	30 Years
Ashford Hill	Reynoldsburg, OH	77	1,310,022			184,985		1,630,021		—		301,951		184,985		1,931,972		2,116,958		(452,700		)	1986	30 Years
Ashgrove (IN)	Indianapolis, IN	57	—			172,924		1,523,549		—		150,346		172,924		1,673,895		1,846,819		(349,833		)	1983	30 Years
Ashgrove (KY)	Louisville, KY	60	—			171,816		1,514,034		—		231,024		171,816		1,745,058		1,916,874		(376,722		)	1984	30 Years
Ashgrove (OH)	Franklin, OH	63	1,173,996			157,535		1,387,687		—		227,802		157,535		1,615,489		1,773,023		(362,621		)	1983	30 Years
Ashgrove I (MI)	Sterling Hts, MI	114	3,017,060			403,580		3,555,988		—		547,558		403,580		4,103,545		4,507,125		(843,274		)	1985	30 Years
Ashgrove II (MI)	Sterling Hts, MI	90	2,139,345			311,912		2,748,287		—		260,649		311,912		3,008,936		3,320,849		(605,253		)	1987	30 Years
Ashton, The	Corona Hills, CA	492	—			2,594,264		33,042,398		—		2,326,776		2,594,264		35,369,174		37,963,438		(9,219,254		)	1986	30 Years
Aspen Crossing	Silver Spring, MD	192	—			2,880,000		8,551,377		—		1,355,018		2,880,000		9,906,395		12,786,395		(2,393,226		)	1979	30 Years
Astorwood (REIT)	Stuart, FL	75	1,533,179			233,150		2,098,338		—		311,998		233,150		2,410,337		2,643,487		(385,241		)	1983	30 Years
Audubon Village	Tampa, FL	447	—			3,576,000		26,121,909		—		1,338,267		3,576,000		27,460,176		31,036,176		(6,430,700		)	1990	30 Years
Autumn Cove	Lithonia, GA	48	—			187,220		1,649,515		—		216,463		187,220		1,865,978		2,053,198		(368,513		)	1985	30 Years
Autumn River	Raleigh, NC	284	(U		)	3,408,000		20,890,457		—		209,845		3,408,000		21,100,302		24,508,302		(872,440		)	2002	30 Years
Auvers Village	Orlando, FL	480	—			3,840,000		29,322,243		—		2,129,770		3,840,000		31,452,013		35,292,013		(7,372,646		)	1991	30 Years
Avon Place	Avon, CT	163	(P		)	1,788,943		12,440,003		—		471,838		1,788,943		12,911,841		14,700,784		(1,926,168		)	1973	30 Years
Balcones Club	Austin, TX	312	—			2,185,500		10,119,232		—		2,085,533		2,185,500		12,204,764		14,390,264		(3,537,040		)	1984	30 Years
Ball Park Lofts	Denver, CO	339	—			7,291,498		53,214,462		—		145,268		7,291,498		53,359,730		60,651,228		(1,373,322		)	2003	30 Years
Barrington	Clarkston, GA	47	949,547			144,459		1,272,842		—		248,949		144,459		1,521,791		1,666,250		(326,352		)	1984	30 Years
Bay Hill	Long Beach, CA	160	13,998,000			7,600,000		27,437,239		—		66,388		7,600,000		27,503,628		35,103,628		(859,890		)	2002	30 Years
Bay Ridge	San Pedro, CA	60	—			2,401,300		2,176,963		—		457,613		2,401,300		2,634,576		5,035,876		(780,068		)	1987	30 Years
Bayside at the Islands	Gilbert, AZ	272	—			3,306,484		15,573,006		—		1,345,534		3,306,484		16,918,540		20,225,024		(4,580,003		)	1989	30 Years
Beckford Place (IN)	New Castle, IN	41	667,349			99,046		872,702		—		181,053		99,046		1,053,756		1,152,802		(225,924		)	1984	30 Years
Beckford Place (Pla)	The Plains, OH	60	—			161,161		1,420,002		—		225,339		161,161		1,645,341		1,806,502		(340,479		)	1982	30 Years
Beckford Place I (OH)	N Canton, OH	60	—			168,426		1,484,248		—		245,703		168,426		1,729,952		1,898,377		(368,923		)	1983	30 Years
Beckford Place II (OH)	N Canton, OH	60	—			172,134		1,516,691		—		133,866		172,134		1,650,557		1,822,691		(340,550		)	1985	30 Years
Bel Aire I	Miami, FL	70	—			188,343		1,658,995		—		270,140		188,343		1,929,135		2,117,478		(407,020		)	1985	30 Years
Bel Aire II	Miami, FL	51	—			136,416		1,201,075		—		190,740		136,416		1,391,816		1,528,232		(296,675		)	1986	30 Years
Bell Road I & II	Nashville, TN	—	—			3,100,000		1,120,214		—		—		3,100,000		1,120,214		4,220,214		—			(F)	30 Years
Bella Terra I	Mukilteo, WA	235	22,964,012			5,686,861		26,092,729		—		200,930		5,686,861		26,293,659		31,980,520		(843,624		)	2002	30 Years
Bella Vista I & II	Los Angeles, CA	315	—			16,883,410		61,318,586		—		81,589		16,883,410		61,400,175		78,283,585		(1,855,990		)	2003	30 Years
Bella Vista III	Los Angeles, CA	—	—			14,799,344		5,493,814		—		—		14,799,344		5,493,814		20,293,159		—			(F)	30 Years
Bellagio Apartment Homes	Scottsdale, AZ	202	—			2,626,000		16,024,404		—		17,355		2,626,000		16,041,759		18,667,759		(128,840		)	1995	30 Years

S-1

EQUITY RESIDENTIAL

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2004

							Cost Capitalized
							Subsequent to		Gross Amount Carried						Life Used to
					Initial Cost to		Acquisition		at Close of						Compute
Description					Company		(Improvements, net) (E)		Period 12/31/04						Depreciation in
Apartment						Building &		Building &		Building &		Accumulated		Date of	Latest Income
Name	Location	Units (J)	Encumbrances		Land	Fixtures	Land	Fixtures	Land	Fixtures (A)	Total (B)	Depreciation		Construction	Statement (C)
Bellevue Meadows	Bellevue, WA	180	—		4,507,100	12,574,814	—	599,067	4,507,100	13,173,881	17,680,981	(3,152,450	)	1983	30 Years
Beneva Place	Sarasota, FL	192	8,700,000		1,344,000	9,665,447	—	650,248	1,344,000	10,315,695	11,659,695	(2,436,445	)	1986	30 Years
Bermuda Cove	Jacksonville, FL	350	—		1,503,000	19,561,896	—	2,415,261	1,503,000	21,977,157	23,480,157	(4,912,044	)	1989	30 Years
Berry Pines	Milton, FL	64	—		154,086	1,299,939	—	357,191	154,086	1,657,130	1,811,216	(415,843	)	1985	30 Years
Bishop Park	Winter Park, FL	324	—		2,592,000	17,990,436	—	2,380,130	2,592,000	20,370,566	22,962,566	(5,003,920	)	1991	30 Years
Blueberry Hill I	Leesburg, FL	68	—		140,370	1,236,710	—	163,814	140,370	1,400,524	1,540,894	(324,509	)	1986	30 Years
Bourbon Square	Palatine, IL	612	—		3,899,744	35,113,276	—	7,956,499	3,899,744	43,069,774	46,969,519	(18,507,618	)	1984-87	30 Years
Bradford Apartments	Newington, CT	64	(P	)	401,091	2,681,210	—	181,438	401,091	2,862,648	3,263,739	(469,961	)	1964	30 Years
Bramblewood	San Jose, CA	108	—		5,190,700	9,659,184	—	407,525	5,190,700	10,066,709	15,257,409	(2,413,571	)	1986	30 Years
Branchwood	Winter Park, FL	117	—		324,069	2,855,397	—	479,492	324,069	3,334,889	3,658,957	(732,950	)	1981	30 Years
Brandon Court	Bloomington, IN	78	—		170,636	1,503,487	—	365,218	170,636	1,868,705	2,039,340	(446,457	)	1984	30 Years
Brentwood	Vancouver, WA	296	—		1,357,221	12,202,521	—	1,737,216	1,357,221	13,939,737	15,296,959	(5,183,593	)	1990	30 Years
Breton Mill	Houston, TX	392	—		212,820	8,547,263	—	1,668,545	212,820	10,215,807	10,428,627	(4,301,152	)	1986	30 Years
Briar Knoll Apts	Vernon, CT	150	5,758,402		928,972	6,209,988	—	383,179	928,972	6,593,167	7,522,139	(1,095,483	)	1986	30 Years
Briarwood (CA)	Sunnyvale, CA	192	13,263,646		9,991,500	22,247,278	—	594,893	9,991,500	22,842,171	32,833,671	(5,155,417	)	1985	30 Years
Bridford Lakes II	Greensboro, NC	—	—		1,100,564	792,509	—	—	1,100,564	792,509	1,893,073	—		(F)	30 Years
Bridgepoint I (REIT)	Jacksonville, FL	71	1,814,896		212,724	1,915,381	—	43,676	212,724	1,959,056	2,171,780	(56,636	)	1986	30 Years
Bridgeport	Raleigh, NC	276	—		1,296,700	11,666,278	—	1,278,526	1,296,700	12,944,805	14,241,505	(5,421,078	)	1990	30 Years
Bridgewater at Wells Crossing	Orange Park, FL	288	—		2,160,000	13,347,549	—	969,382	2,160,000	14,316,930	16,476,930	(2,877,614	)	1986	30 Years
Brittany Square	Tulsa, OK	212	—		625,000	4,050,961	—	1,826,134	625,000	5,877,095	6,502,095	(4,013,888	)	1982	30 Years
Broadview Oaks (REIT)	Pensacola, FL	90	—		201,000	1,809,185	—	291,633	201,000	2,100,817	2,301,817	(350,598	)	1985	30 Years
Broadway	Garland, TX	288	5,716,428		1,443,700	7,790,989	—	1,750,628	1,443,700	9,541,617	10,985,317	(2,716,685	)	1983	30 Years
Brookdale Village	Naperville, IL	252	10,820,000		3,276,000	16,293,471	—	1,547,553	3,276,000	17,841,024	21,117,024	(3,741,886	)	1986	30 Years
Brookridge	Centreville, VA	252	—		2,521,500	16,003,839	—	1,587,175	2,521,500	17,591,014	20,112,514	(4,717,255	)	1989	30 Years
Brookside (CO)	Boulder, CO	144	—		3,600,400	10,211,159	—	417,446	3,600,400	10,628,605	14,229,005	(2,542,403	)	1993	30 Years
Brookside (MD)	Frederick, MD	228	8,170,000		2,736,000	7,934,517	—	1,106,474	2,736,000	9,040,990	11,776,990	(2,098,051	)	1993	30 Years
Brookside Crossing I	Stockton, CA	90	4,658,000		625,000	4,656,691	—	690,452	625,000	5,347,143	5,972,143	(838,009	)	1981	30 Years
Brookside Crossing II	Stockton, CA	128	4,867,000		770,000	4,415,388	—	804,612	770,000	5,219,999	5,989,999	(883,001	)	1981	30 Years
Brookside II (MD)	Frederick, MD	204	—		2,450,800	6,913,202	—	1,189,290	2,450,800	8,102,492	10,553,292	(2,269,377	)	1979	30 Years
Brooksyde Apts	West Hartford, CT	80	(P	)	594,711	3,975,523	—	300,442	594,711	4,275,965	4,870,676	(703,140	)	1945	30 Years
Burgundy Studios	Middletown, CT	102	(P	)	395,238	2,642,087	—	188,643	395,238	2,830,729	3,225,967	(503,710	)	1973	30 Years
Burwick Farms	Howell, MI	264	—		1,104,600	9,932,207	—	929,402	1,104,600	10,861,609	11,966,209	(3,097,175	)	1991	30 Years
Cambridge at Hickory Hollow	Antioch, TN	360	(I	)	3,240,800	17,900,033	—	1,077,868	3,240,800	18,977,901	22,218,701	(5,170,223	)	1997	30 Years
Cambridge Commons I	Indianapolis, IN	86	—		179,139	1,578,077	—	573,977	179,139	2,152,055	2,331,194	(550,758	)	1986	30 Years
Cambridge Commons II	Indianapolis, IN	75	807,847		141,845	1,249,511	—	402,208	141,845	1,651,719	1,793,564	(416,058	)	1987	30 Years
Cambridge Commons III	Indianapolis, IN	75	—		98,125	864,738	—	342,646	98,125	1,207,384	1,305,509	(328,594	)	1988	30 Years
Cambridge Estates	Norwich, CT	92	—		590,185	3,945,265	—	222,821	590,185	4,168,086	4,758,271	(682,555	)	1977	30 Years
Camellero	Scottsdale, AZ	348	—		1,924,900	17,324,593	—	4,020,403	1,924,900	21,344,996	23,269,896	(8,727,272	)	1979	30 Years
Camellia Court I (Col)	Columbus, OH	64	—		133,059	1,172,393	—	248,182	133,059	1,420,574	1,553,633	(324,921	)	1981	30 Years
Camellia Court I (Day)	Dayton, OH	57	1,021,676		131,858	1,162,066	—	252,681	131,858	1,414,746	1,546,605	(337,348	)	1981	30 Years
Camellia Court II (Col)	Columbus, OH	40	881,303		118,421	1,043,417	—	266,806	118,421	1,310,223	1,428,644	(284,686	)	1984	30 Years
Camellia Court II (Day)	Dayton, OH	53	—		131,571	1,159,283	—	149,013	131,571	1,308,296	1,439,867	(286,029	)	1982	30 Years
Candlelight I	Brooksville, FL	51	563,330		105,000	925,167	—	294,927	105,000	1,220,093	1,325,094	(255,934	)	1982	30 Years
Candlelight II	Brooksville, FL	60	554,895		95,061	837,593	—	304,274	95,061	1,141,867	1,236,929	(258,852	)	1985	30 Years
Canterbury	Germantown, MD	544	31,680,000		2,781,300	32,942,366	—	3,758,157	2,781,300	36,700,524	39,481,824	(11,471,469	)	1986	30 Years
Canterbury Crossings	Lake Mary, FL	71	—		273,671	2,411,538	—	352,465	273,671	2,764,002	3,037,673	(542,467	)	1983	30 Years
Canyon Creek (CA)	San Ramon, CA	268	28,000,000		5,425,000	17,652,986	—	723,767	5,425,000	18,376,752	23,801,752	(2,623,658	)	1984	30 Years
Canyon Crest	Santa Clarita, CA	158	—		2,370,000	10,141,878	—	758,919	2,370,000	10,900,797	13,270,797	(2,411,558	)	1993	30 Years
Canyon Ridge	San Diego, CA	162	—		4,869,448	11,955,064	—	844,230	4,869,448	12,799,294	17,668,742	(3,306,043	)	1989	30 Years
Capital Ridge (REIT)	Tallahassee, FL	70	—		177,900	1,601,157	—	241,492	177,900	1,842,649	2,020,549	(291,527	)	1983	30 Years
Carleton Court (MI) (REIT)	Ann Arbor, MI	104	2,855,199		323,554	2,911,982	—	55,711	323,554	2,967,693	3,291,246	(106,225	)	1985	30 Years
Carlyle	Dallas, TX	180	8,265,766		1,890,000	14,155,000	—	311,450	1,890,000	14,466,450	16,356,450	(815,665	)	1993	30 Years
Carlyle Mill	Alexandria, VA	317	—		10,000,000	51,368,058	—	182,716	10,000,000	51,550,775	61,550,775	(2,977,551	)	2002	30 Years
Carmel Terrace	San Diego, CA	384	—		2,288,300	20,596,281	—	1,592,508	2,288,300	22,188,789	24,477,089	(8,060,779	)	1988-89	30 Years
Carriage Hill	Dublin, GA	60	—		131,911	1,162,577	—	106,253	131,911	1,268,830	1,400,740	(273,197	)	1985	30 Years
Casa Capricorn	San Diego, CA	192	—		1,262,700	11,365,093	—	1,908,617	1,262,700	13,273,710	14,536,410	(3,972,832	)	1981	30 Years
Casa Ruiz	San Diego, CA	196	—		3,922,400	9,389,153	—	1,810,002	3,922,400	11,199,155	15,121,555	(3,057,705	)	1976-1986	30 Years
Cascade at Landmark	Alexandria, VA	277	—		3,603,400	19,657,554	—	2,193,053	3,603,400	21,850,607	25,454,007	(6,182,270	)	1990	30 Years
Cedar Glen	Reading, MA	114	3,304,158		1,248,505	8,346,003	—	510,282	1,248,505	8,856,285	10,104,791	(1,329,944	)	1980	30 Years
Cedar Hill	Knoxville, TN	74	1,413,125		204,792	1,804,444	—	183,756	204,792	1,988,200	2,192,992	(434,131	)	1986	30 Years
Cedargate (GA)	Lawrenceville, GA	55	—		205,043	1,806,656	—	132,326	205,043	1,938,982	2,144,026	(380,606	)	1983	30 Years
Cedargate (MI)	Michigan City, IN	53	743,910		120,378	1,060,663	—	133,735	120,378	1,194,398	1,314,776	(254,379	)	1983	30 Years
Cedargate (She)	Shelbyville, KY	58	1,096,017		158,685	1,398,041	—	241,291	158,685	1,639,332	1,798,017	(351,944	)	1984	30 Years
Cedargate I (Cla)	Clayton, OH	61	1,150,203		159,599	1,406,493	—	235,157	159,599	1,641,650	1,801,249	(366,246	)	1984	30 Years
Cedargate I (IN)	Bloomington, IN	68	—		191,650	1,688,648	—	334,428	191,650	2,023,076	2,214,726	(433,978	)	1983	30 Years
Cedargate I (OH)	Lancaster, OH	110	2,156,949		240,587	2,119,432	—	440,553	240,587	2,559,985	2,800,572	(570,850	)	1982	30 Years
Cedargate II (IN)	Bloomington, IN	58	—		165,041	1,454,189	—	133,663	165,041	1,587,851	1,752,892	(348,128	)	1985	30 Years
Cedargate II (OH)	Lancaster, OH	47	670,395		87,618	771,912	—	128,098	87,618	900,010	987,628	(208,948	)	1983	30 Years
Cedarwood I (FL)	Ocala, FL	55	104,000		119,470	1,052,657	—	245,669	119,470	1,298,326	1,417,796	(295,626	)	1978	30 Years
Cedarwood I (IN)	Goshen, IN	90	1,777,307		251,745	2,218,126	—	371,028	251,745	2,589,154	2,840,899	(573,685	)	1983/84	30 Years
Cedarwood I (KY)	Lexington, KY	50	—		106,681	939,874	—	264,110	106,681	1,203,984	1,310,665	(282,314	)	1984	30 Years
Cedarwood II (FL)	Ocala, FL	39	—		98,372	866,769	—	97,663	98,372	964,432	1,062,804	(211,271	)	1980	30 Years
Cedarwood II (KY)	Lexington, KY	48	969,000		106,724	940,357	—	229,822	106,724	1,170,179	1,276,903	(275,230	)	1986	30 Years
Cedarwood III (KY)	Lexington, KY	48	—		102,491	902,659	—	163,951	102,491	1,066,611	1,169,102	(237,986	)	1986	30 Years
CenterPointe	Beaverton, OR	264	—		3,432,000	15,708,853	—	1,869,580	3,432,000	17,578,433	21,010,433	(2,164,146	)	1996	30 Years
Centre Club	Ontario, CA	312	—		5,616,000	23,485,891	—	1,075,219	5,616,000	24,561,110	30,177,110	(3,901,036	)	1994	30 Years
Centre Club II	Ontario, CA	100	—		1,820,000	9,528,898	—	17,424	1,820,000	9,546,322	11,366,322	(915,546	)	2002	30 Years
Centre Lake III	Miami, FL	234	—		685,601	6,039,979	—	914,071	685,601	6,954,050	7,639,651	(1,462,651	)	1986	30 Years
Champion Oaks	Houston, TX	252	—		931,900	8,389,394	—	1,340,278	931,900	9,729,672	10,661,572	(3,886,855	)	1984	30 Years

S-2

EQUITY RESIDENTIAL

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2004

							Cost Capitalized
							Subsequent to		Gross Amount Carried						Life Used to
					Initial Cost to		Acquisition		at Close of						Compute
Description					Company		(Improvements, net) (E)		Period 12/31/04						Depreciation in
Apartment						Building &		Building &		Building &		Accumulated		Date of	Latest Income
Name	Location	Units (J)	Encumbrances		Land	Fixtures	Land	Fixtures	Land	Fixtures (A)	Total (B)	Depreciation		Construction	Statement (C)
Chandler Court	Chandler, AZ	312	—		1,353,100	12,175,173	—	2,572,316	1,353,100	14,747,489	16,100,589	(5,450,143	)	1987	30 Years
Chantecleer Lakes	Naperville, IL	304	—		6,689,400	16,332,279	—	1,854,202	6,689,400	18,186,481	24,875,881	(5,011,429	)	1986	30 Years
Charing Cross	Bowling Green, OH	67	—		154,584	1,362,057	—	214,373	154,584	1,576,430	1,731,015	(347,720	)	1978	30 Years
Chatelaine Park	Duluth, GA	303	—		1,818,000	24,489,671	—	754,704	1,818,000	25,244,375	27,062,375	(5,661,992	)	1995	30 Years
Chelsea Square	Redmond, WA	113	—		3,397,100	9,289,074	—	403,187	3,397,100	9,692,261	13,089,361	(2,312,051	)	1991	30 Years
Cherry Creek I,II,&III (TN)	Hermitage, TN	627	—		2,942,345	45,725,245	—	1,347,501	2,942,345	47,072,746	50,015,091	(9,819,177	)	1986/96	30 Years
Cherry Creek IV	Hermitage, TN	—	—		—	1,593	—	—	—	1,593	1,593	—		(F)	30 Years
Cherry Glen I	Indianapolis, IN	138	2,916,607		335,596	2,957,360	—	408,700	335,596	3,366,060	3,701,656	(778,335	)	1986/87	30 Years
Cherry Tree	Rosedale, MD	100	—		352,003	3,101,017	—	294,562	352,003	3,395,578	3,747,581	(713,195	)	1986	30 Years
Chestnut Glen	Abington, MA	130	5,072,859		1,178,965	7,881,139	—	348,378	1,178,965	8,229,517	9,408,482	(1,292,495	)	1983	30 Years
Chestnut Hills	Puyallup, WA	157	—		756,300	6,806,635	—	827,211	756,300	7,633,845	8,390,145	(2,259,009	)	1991	30 Years
Chickasaw Crossing	Orlando, FL	292	11,665,370		2,044,000	12,366,832	—	913,804	2,044,000	13,280,637	15,324,637	(3,144,749	)	1986	30 Years
Chinatown Gateway (Land)	Los Angeles, CA	—	—		13,191,887	228,021	—	—	13,191,887	228,021	13,419,908	—		(F)	30 Years
Church Corner	Cambridge, MA (G)	85	12,000,000		5,220,000	16,743,280	—	16,728	5,220,000	16,760,008	21,980,008	(285,168	)	1987	30 Years
Cierra Crest	Denver, CO	480	(R	)	4,803,100	34,894,898	—	1,579,244	4,803,100	36,474,141	41,277,241	(9,214,934	)	1996	30 Years
Cimarron Ridge	Aurora, CO	296	—		1,591,100	14,320,031	—	2,196,184	1,591,100	16,516,215	18,107,315	(5,203,033	)	1984	30 Years
City Place at West Port	Kansas City, MO	288	—		6,650,536	27,109,941	—	17,106	6,650,536	27,127,046	33,777,582	(903,936	)	2003	30 Years
City View at Highlands	Lombard, IL	403	—		4,636,653	60,642,751	—	30,382	4,636,653	60,673,132	65,309,785	(1,465,753	)	2003	30 Years
Claire Point	Jacksonville, FL	256	—		2,048,000	14,649,393	—	1,065,479	2,048,000	15,714,872	17,762,872	(3,781,827	)	1986	30 Years
Clarion	Decatur, GA	217	—		1,504,300	13,537,919	—	965,629	1,504,300	14,503,548	16,007,848	(3,803,752	)	1990	30 Years
Clarys Crossing	Columbia, MD	198	—		891,000	15,489,721	—	1,085,643	891,000	16,575,363	17,466,363	(3,803,088	)	1984	30 Years
Classic, The	Stamford, CT	144	—		2,883,500	20,336,721	—	2,135,298	2,883,500	22,472,019	25,355,519	(6,046,488	)	1990	30 Years
Clearview I	Greenwood, IN	70	12,735		182,206	1,605,429	—	261,613	182,206	1,867,042	2,049,248	(427,270	)	1986	30 Years
Clearview II	Greenwood, IN	80	—		226,963	1,999,792	—	176,908	226,963	2,176,700	2,403,663	(467,904	)	1987	30 Years
Clearwater	Eastlake, OH	42	1,008,377		128,303	1,130,691	—	168,914	128,303	1,299,605	1,427,908	(271,246	)	1986	30 Years
Club at Tanasbourne	Hillsboro, OR	352	(Q	)	3,521,300	16,257,934	—	1,709,353	3,521,300	17,967,287	21,488,587	(5,478,165	)	1990	30 Years
Club at the Green	Beaverton, OR	254	—		2,030,950	12,616,747	—	1,730,465	2,030,950	14,347,212	16,378,162	(4,282,616	)	1991	30 Years
Coach Lantern	Scarborough, ME	90	—		452,900	4,405,723	—	507,048	452,900	4,912,771	5,365,671	(1,324,668	)	1971/1981	30 Years
Coachlight Village	Agawam, MA	88	(P	)	501,726	3,353,933	—	207,677	501,726	3,561,610	4,063,335	(566,897	)	1967	30 Years
Coachman Trails	Plymouth, MN	154	6,093,167		1,227,000	9,517,381	—	891,763	1,227,000	10,409,144	11,636,144	(2,611,133	)	1987	30 Years
Cobblestone Village	Fresno, CA	162	6,000,000		315,000	5,336,557	—	798,127	315,000	6,134,684	6,449,684	(1,016,643	)	1983	30 Years
Coconut Palm Club	Coconut Creek, GA	300	—		3,001,700	17,678,928	—	1,109,364	3,001,700	18,788,293	21,789,993	(4,667,609	)	1992	30 Years
Colinas Pointe	Denver, CO	272	—		1,587,400	14,285,902	—	1,062,435	1,587,400	15,348,337	16,935,737	(4,333,187	)	1986	30 Years
Collier Ridge	Atlanta, GA	300	—		5,100,000	20,425,822	—	2,766,290	5,100,000	23,192,112	28,292,112	(5,218,742	)	1980	30 Years
Colonial Village	Plainville, CT	104	(P	)	693,575	4,636,410	—	394,526	693,575	5,030,935	5,724,511	(835,410	)	1968	30 Years
Concord Square (IN)	Kokomo, IN	49	—		123,247	1,085,962	—	153,908	123,247	1,239,870	1,363,117	(270,319	)	1983	30 Years
Concord Square I (OH)	Mansfield, OH	72	—		164,124	1,446,313	—	249,055	164,124	1,695,368	1,859,492	(365,692	)	1981/83	30 Years
Conway Court	Roslindale, MA	28	417,473		101,451	710,524	—	61,578	101,451	772,101	873,552	(133,587	)	1920	30 Years
Conway Station	Orlando, FL	242	—		1,936,000	10,852,858	—	825,291	1,936,000	11,678,149	13,614,149	(2,809,253	)	1987	30 Years
Copper Canyon	Highlands Ranch, CO	222	(O	)	1,443,000	16,251,114	—	475,131	1,443,000	16,726,244	18,169,244	(3,449,162	)	1999	30 Years
Copper Creek	Tempe, AZ	144	—		1,017,400	9,148,068	—	899,289	1,017,400	10,047,356	11,064,756	(2,933,574	)	1984	30 Years
Copper Terrace	Orlando, FL	300	—		1,200,000	17,887,868	—	1,605,321	1,200,000	19,493,190	20,693,190	(4,637,789	)	1989	30 Years
Cortona at Dana Park	Mesa, AZ	222	—		2,028,939	12,466,128	—	1,248,041	2,028,939	13,714,169	15,743,108	(3,767,643	)	1986	30 Years
Country Brook	Chandler, AZ	396	—		1,505,219	29,542,535	—	1,408,211	1,505,219	30,950,746	32,455,965	(7,959,627	)	1986-1996	30 Years
Country Club Condominium, LLC	Mill Creek, WA	86	—		646,108	5,985,305	—	1,342,996	646,108	7,328,301	7,974,409	(1,645,413	)	1991	30 Years
Country Club Place (FL)	Pembroke Pines, FL	152	—		912,000	10,016,543	—	980,151	912,000	10,996,694	11,908,694	(2,695,202	)	1987	30 Years
Country Club Woods	Mobile, AL (T)	256	4,156,457		230,091	5,561,464	—	718,267	230,091	6,279,731	6,509,822	(1,475,802	)	1975	30 Years
Country Gables	Beaverton, OR	288	—		1,580,500	14,215,444	—	2,393,228	1,580,500	16,608,671	18,189,171	(5,077,043	)	1991	30 Years
Country Gables II	Beaverton, OR	—	—		1,200,000	4,006	—	—	1,200,000	4,006	1,204,006	—		(F)	30 Years
Country Oaks	Agoura Hills, CA	256	29,412,000		6,105,000	20,902,294	—	754,966	6,105,000	21,657,261	27,762,261	(2,941,821	)	1985	30 Years
Country Ridge	Farmington Hills, MI	252	—		1,621,950	14,596,964	—	2,107,915	1,621,950	16,704,879	18,326,829	(5,449,859	)	1986	30 Years
Countryside I	Daytona Beach, FL	59	—		136,665	1,204,164	—	392,156	136,665	1,596,320	1,732,984	(376,866	)	1982	30 Years
Countryside II	Daytona Beach, FL	97	—		234,633	2,067,376	—	308,009	234,633	2,375,384	2,610,018	(509,739	)	1982	30 Years
Countryside III (REIT)	Daytona Beach, FL	34	—		80,000	719,868	—	105,958	80,000	825,826	905,826	(135,167	)	1983	30 Years
Countryside Manor	Douglasville, GA	82	—		298,186	2,627,348	—	291,381	298,186	2,918,728	3,216,915	(629,258	)	1985	30 Years
Cove at Fishers Landing	Vancouver, WA	253	—		2,277,000	15,656,887	—	399,121	2,277,000	16,056,008	18,333,008	(1,664,475	)	1993	30 Years
Coventry at Cityview	Fort Worth, TX	360	(U	)	2,160,000	23,072,847	—	1,117,286	2,160,000	24,190,133	26,350,133	(5,515,625	)	1996	30 Years
Creekside (San Mateo)	San Mateo, CA	192	(R	)	9,606,600	21,193,232	—	632,515	9,606,600	21,825,746	31,432,346	(5,093,503	)	1985	30 Years
Creekside Homes at Legacy	Plano. TX	380	—		4,560,000	32,275,748	—	905,140	4,560,000	33,180,888	37,740,888	(7,390,494	)	1998	30 Years
Creekside Village	Mountlake Terrace, WA	512	—		2,807,600	25,270,594	—	2,821,193	2,807,600	28,091,787	30,899,387	(10,628,817	)	1987	30 Years
Creekwood	Charlotte, NC	384	—		1,861,700	16,740,569	—	1,764,067	1,861,700	18,504,635	20,366,335	(5,152,952	)	1987-1990	30 Years
Crescent at Cherry Creek	Denver, CO	216	(O	)	2,594,000	15,149,470	—	856,813	2,594,000	16,006,282	18,600,282	(4,193,715	)	1994	30 Years
Cross Creek	Matthews, NC	420	(R	)	3,151,600	20,295,925	—	1,374,687	3,151,600	21,670,612	24,822,212	(5,343,662	)	1989	30 Years
Crosswinds	St. Petersburg, FL	208	—		1,561,200	5,756,822	—	1,192,049	1,561,200	6,948,871	8,510,071	(2,254,517	)	1986	30 Years
Crown Court	Scottsdale, AZ	416	(S	)	3,156,600	28,414,599	—	2,452,734	3,156,600	30,867,333	34,023,933	(8,953,508	)	1987	30 Years
Crystal Village	Attleboro, MA	91	—		1,369,000	4,989,028	—	1,554,613	1,369,000	6,543,641	7,912,641	(1,729,715	)	1974	30 Years
Cypress	Panama City, FL	70	1,305,670		171,882	1,514,636	—	343,108	171,882	1,857,744	2,029,626	(419,547	)	1985	30 Years
Cypress Lake at Waterford	Orlando, Fl	316	—		7,000,000	27,654,816	—	55,926	7,000,000	27,710,742	34,710,742	(914,728	)	2001	30 Years
Daniel Court	Cincinnati, OH	114	2,163,506		334,101	2,943,516	—	593,050	334,101	3,536,567	3,870,667	(853,366	)	1985	30 Years
Dartmouth Place I	Kent, OH	53	—		151,771	1,337,422	—	295,742	151,771	1,633,164	1,784,935	(368,806	)	1982	30 Years
Dartmouth Place II	Kent, OH	49	—		130,102	1,146,337	—	185,559	130,102	1,331,896	1,461,997	(288,280	)	1986	30 Years
Dartmouth Woods	Lakewood, CO	201	—		1,609,800	10,832,754	—	916,193	1,609,800	11,748,947	13,358,747	(3,380,891	)	1990	30 Years
Dean Estates	Taunton, MA	58	—		498,080	3,329,560	—	212,040	498,080	3,541,601	4,039,680	(564,615	)	1984	30 Years
Dean Estates II	Cranston, RI	48	(P	)	308,457	2,061,971	—	215,598	308,457	2,277,569	2,586,026	(388,860	)	1970	30 Years
Deerbrook	Jacksonville, FL	144	—		1,008,000	8,845,716	—	871,313	1,008,000	9,717,029	10,725,029	(2,362,246	)	1983	30 Years
Deerfield	Denver, CO	158	9,100,000		1,260,000	7,869,511	—	972,466	1,260,000	8,841,977	10,101,977	(1,359,690	)	1983	30 Years
Deerwood (Corona)	Corona, CA	316	(U	)	4,742,200	20,272,892	—	1,964,944	4,742,200	22,237,836	26,980,036	(6,021,965	)	1992	30 Years
Deerwood (FL)	Eustis, FL	50	802,868		114,948	1,012,819	—	179,658	114,948	1,192,477	1,307,425	(278,938	)	1982	30 Years
Deerwood (SD)	San Diego, CA	316	—		2,082,095	18,739,815	—	4,711,729	2,082,095	23,451,545	25,533,640	(10,161,685	)	1990	30 Years

S-3

EQUITY RESIDENTIAL

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2004

							Cost Capitalized
							Subsequent to		Gross Amount Carried						Life Used to
					Initial Cost to		Acquisition		at Close of						Compute
Description					Company		(Improvements, net) (E)		Period 12/31/04						Depreciation in
Apartment						Building &		Building &		Building &		Accumulated		Date of	Latest Income
Name	Location	Units (J)	Encumbrances		Land	Fixtures	Land	Fixtures	Land	Fixtures (A)	Total (B)	Depreciation		Construction	Statement (C)
Defoor Village	Atlanta, GA	156	—		2,966,400	10,570,210	—	1,481,209	2,966,400	12,051,419	15,017,819	(2,630,269	)	1997	30 Years
Desert Homes	Phoenix, AZ	412	—		1,481,050	13,390,249	—	2,999,004	1,481,050	16,389,253	17,870,303	(5,637,666	)	1982	30 Years
Dogwood Glen I	Indianapolis, IN	83	1,702,607		240,855	2,122,193	—	315,647	240,855	2,437,840	2,678,695	(529,046	)	1986	30 Years
Dogwood Glen II	Indianapolis, IN	77	1,233,044		202,397	1,783,336	—	236,718	202,397	2,020,054	2,222,451	(444,418	)	1987	30 Years
Dover Place I	Eastlake, OH	64	—		244,294	2,152,494	—	280,600	244,294	2,433,094	2,677,388	(515,881	)	1982	30 Years
Dover Place II	Eastlake, OH	63	1,513,570		230,895	2,034,242	—	203,705	230,895	2,237,947	2,468,842	(445,730	)	1983	30 Years
Dover Place III	Eastlake, OH	30	717,129		119,835	1,055,878	—	69,260	119,835	1,125,138	1,244,973	(217,537	)	1983	30 Years
Dover Place IV	Eastlake, OH	72	1,741,599		261,912	2,307,730	—	192,941	261,912	2,500,671	2,762,583	(485,582	)	1986	30 Years
Driftwood	Atlantic Beach, FL	63	346,206		126,357	1,113,430	—	292,159	126,357	1,405,590	1,531,947	(332,920	)	1985	30 Years
Duraleigh Woods	Raleigh, NC	362	—		1,629,000	19,917,750	—	2,603,288	1,629,000	22,521,038	24,150,038	(5,454,738	)	1987	30 Years
Eagle Canyon	Chino Hills, CA	252	—		1,808,900	16,426,168	—	1,185,487	1,808,900	17,611,655	19,420,555	(5,351,042	)	1985	30 Years
East Pointe	Charlotte, NC	310	—		1,365,900	12,295,246	—	1,957,169	1,365,900	14,252,415	15,618,315	(6,001,904	)	1987	30 Years
Eastbridge	Dallas, TX	169	8,547,271		3,380,000	11,860,382	—	386,610	3,380,000	12,246,992	15,626,992	(1,627,418	)	1998	30 Years
Edgewater	Bakersfield, CA	258	11,988,000		580,000	11,119,979	—	1,013,042	580,000	12,133,021	12,713,021	(1,932,602	)	1984	30 Years
Edgewood	Woodinville, WA	203	—		1,070,100	9,632,980	—	1,245,739	1,070,100	10,878,719	11,948,819	(4,187,897	)	1986	30 Years
Elmtree Park I	Indianapolis, IN	72	1,367,159		157,687	1,389,621	—	266,267	157,687	1,655,888	1,813,575	(397,263	)	1986	30 Years
Elmtree Park II	Indianapolis, IN	53	859,729		114,114	1,005,455	—	193,057	114,114	1,198,512	1,312,626	(289,067	)	1987	30 Years
Elmwood (GA)	Marietta, GA	48	—		183,756	1,619,095	—	241,915	183,756	1,861,010	2,044,766	(387,936	)	1984	30 Years
Elmwood I (FL)	W. Palm Beach, FL	52	316,202		163,389	1,439,632	—	156,874	163,389	1,596,506	1,759,895	(334,863	)	1984	30 Years
Elmwood II (FL)	W. Palm Beach, FL	50	1,230,468		179,743	1,582,960	—	133,228	179,743	1,716,188	1,895,932	(356,091	)	1984	30 Years
Emerson Place	Boston, MA (G)	462	—		14,855,000	57,566,636	—	11,994,873	14,855,000	69,561,509	84,416,509	(18,275,154	)	1962	30 Years
Emerson Place/CRP II	Boston, MA	—	—		—	1,716,729	—	—	—	1,716,729	1,716,729	—		(F)	30 Years
Enclave at Winston Park	Coconut Creek, FL	278	—		5,560,000	19,939,324	—	417,836	5,560,000	20,357,160	25,917,160	(2,169,693	)	1995	30 Years
Enclave, The	Tempe, AZ	204	(O	)	1,500,192	19,281,399	—	662,156	1,500,192	19,943,555	21,443,747	(4,967,574	)	1994	30 Years
EOP Orange	Orange, CA	—	—		—	275,099	—	—	—	275,099	275,099	—		(F)	30 Years
Esprit Del Sol	Solana Beach, CA	146	—		5,111,200	11,910,438	—	741,504	5,111,200	12,651,942	17,763,142	(3,049,533	)	1986	30 Years
Fairfield	Stamford, CT (G)	263	—		6,510,200	39,690,120	—	1,224,464	6,510,200	40,914,584	47,424,784	(9,550,541	)	1996	30 Years
Fairland Gardens	Silver Spring, MD	400	—		6,000,000	19,972,183	—	2,159,568	6,000,000	22,131,751	28,131,751	(5,088,578	)	1981	30 Years
Farnham Park	Houston, TX	216	—		1,512,600	14,233,760	—	706,986	1,512,600	14,940,746	16,453,346	(3,785,389	)	1996	30 Years
Fernbrook Townhomes	Plymouth, MN	72	4,970,424		580,100	6,683,693	—	372,578	580,100	7,056,271	7,636,371	(1,640,103	)	1993	30 Years
Fireside Park	Rockville, MD	236	8,095,000		4,248,000	9,977,101	—	1,348,752	4,248,000	11,325,853	15,573,853	(2,652,665	)	1961	30 Years
Forest Glen	Pensacola, FL	73	—		161,548	1,423,618	—	274,455	161,548	1,698,074	1,859,622	(411,570	)	1986	30 Years
Forest Ridge I & II	Arlington, TX	660	(S	)	2,362,700	21,263,295	—	3,402,487	2,362,700	24,665,782	27,028,482	(8,505,590	)	1984/85	30 Years
Forest Village	Macon, GA	83	—		224,022	1,973,876	—	301,419	224,022	2,275,295	2,499,317	(465,343	)	1983	30 Years
Forsythia Court (KY)	Louisville, KY	98	1,769,936		279,450	2,462,187	—	364,708	279,450	2,826,895	3,106,345	(611,355	)	1985	30 Years
Forsythia Court (MD)	Abingdon, MD	76	1,945,272		251,955	2,220,100	—	393,106	251,955	2,613,206	2,865,161	(577,125	)	1986	30 Years
Forsythia Court II (MD)	Abingdon, MD	76	—		239,834	2,113,339	—	279,078	239,834	2,392,417	2,632,250	(522,113	)	1987	30 Years
Fountain Place I	Eden Prairie, MN	332	24,653,106		2,405,068	21,694,117	—	1,699,062	2,405,068	23,393,179	25,798,247	(6,168,758	)	1989	30 Years
Fountain Place II	Eden Prairie, MN	158	12,600,000		1,231,350	11,095,333	—	689,599	1,231,350	11,784,933	13,016,282	(3,041,287	)	1989	30 Years
Fountainhead I	San Antonio, TX	240	(M	)	1,205,816	5,200,241	—	774,764	1,205,816	5,975,004	7,180,820	(3,809,231	)	1985/1987	30 Years
Fountainhead II	San Antonio, TX	224	(M	)	1,205,817	4,529,801	—	1,381,419	1,205,817	5,911,220	7,117,037	(3,586,800	)	1985/1987	30 Years
Fountainhead III	San Antonio, TX	224	(M	)	1,205,816	4,399,093	—	1,382,063	1,205,816	5,781,155	6,986,971	(3,298,924	)	1985/1987	30 Years
Four Lakes	Lisle, IL	168	—		439,605	2,567,975	—	3,898,126	439,605	6,466,101	6,905,706	(4,298,527	)	1968/1988	30 Years
Four Lakes 5	Lisle, IL	478	(M	)	600,000	19,186,686	—	2,415,140	600,000	21,601,826	22,201,826	(12,121,234	)	1968/1988	30 Years
Four Lakes Athletic Club	Lisle, IL (G)	—	—		50,000	153,489	—	95,111	50,000	248,600	298,600	(30,118	)	N/A	30 Years
Four Lakes Condo, LLC Phase V	Lisle, IL	3	—		9,076	46,327	—	30,155	9,076	76,482	85,557	(53,561	)	1968/1988	30 Years
Four Lakes Condo, LLC Phase VI	Lisle, IL	64	—		145,787	866,188	—	2,733,361	145,787	3,599,549	3,745,337	(1,424,945	)	1970/1988	30 Years
Four Lakes Condo, LLC Phase VII	Lisle, IL	60	—		157,002	924,495	—	1,605,395	157,002	2,529,890	2,686,892	(1,535,188	)	1970/1988	30 Years
Four Lakes Leasing Center	Lisle, IL (G)	—	—		50,000	152,815	—	41,649	50,000	194,464	244,464	(56,982	)	N/A	30 Years
Four Winds	Fall River, MA	168	(P	)	1,370,843	9,163,804	—	396,532	1,370,843	9,560,337	10,931,179	(1,532,287	)	1987	30 Years
Fox Hill Apartments	Enfield, CT	168	(P	)	1,129,018	7,547,256	—	325,187	1,129,018	7,872,443	9,001,461	(1,289,474	)	1974	30 Years
Fox Ridge	Englewood, CO	300	20,300,000		2,490,000	17,509,781	—	1,038,933	2,490,000	18,548,715	21,038,715	(2,863,047	)	1984	30 Years
Fox Run (WA)	Federal Way, WA	144	—		639,700	5,765,018	—	1,019,284	639,700	6,784,302	7,424,002	(2,743,915	)	1988	30 Years
Fox Run II (WA)	Federal Way, WA	18	—		80,000	1,286,139	—	53,086	80,000	1,339,225	1,419,225	(68,614	)	1988	30 Years
Foxcroft	Scarborough, ME	104	—		523,400	4,527,409	—	459,910	523,400	4,987,319	5,510,719	(1,373,480	)	1977/1979	30 Years
Foxhaven	Canton, OH	107	—		256,821	2,263,172	—	468,520	256,821	2,731,692	2,988,513	(615,192	)	1986	30 Years
Foxton (MI)	Monroe, MI	51	—		156,363	1,377,824	—	227,956	156,363	1,605,780	1,762,142	(329,340	)	1983	30 Years
Foxton II (OH)	Dayton, OH	80	—		165,806	1,460,832	—	165,610	165,806	1,626,443	1,792,248	(353,852	)	1983	30 Years
Gables Grand Plaza	Coral Gables, FL (G)	195	—		—	44,600,668	—	456,040	—	45,056,708	45,056,708	(1,828,219	)	1998	30 Years
Garden Court	Detroit, MI	102	1,961,858		351,532	3,096,890	—	249,743	351,532	3,346,633	3,698,165	(670,813	)	1988	30 Years
Garden Lake	Riverdale, GA	278	—		1,466,900	13,186,716	—	1,072,858	1,466,900	14,259,574	15,726,474	(3,954,381	)	1991	30 Years
Garden Terrace I	Tampa, FL	59	—		93,144	820,699	—	358,439	93,144	1,179,138	1,272,282	(294,510	)	1981	30 Years
Garden Terrace II	Tampa, FL	65	—		97,120	855,730	—	351,388	97,120	1,207,118	1,304,238	(296,126	)	1982	30 Years
Gatehouse at Pine Lake	Pembroke Pines, FL	296	—		1,896,600	17,070,795	—	1,394,788	1,896,600	18,465,582	20,362,182	(5,626,720	)	1990	30 Years
Gatehouse on the Green	Plantation, FL	312	—		2,228,200	20,056,270	—	1,710,816	2,228,200	21,767,086	23,995,286	(6,657,158	)	1990	30 Years
Gates at Carlson Center	Minnetonka, MN	435	(N	)	4,355,200	23,802,817	—	5,306,365	4,355,200	29,109,182	33,464,382	(7,368,735	)	1989	30 Years
Gates of Redmond	Redmond, WA	180	—		2,306,100	12,064,015	—	957,415	2,306,100	13,021,430	15,327,530	(3,557,459	)	1979	30 Years
Gateway at Malden Center	Malden, MA (G)	203	—		9,209,780	25,722,666	—	650,065	9,209,780	26,372,731	35,582,511	(1,825,363	)	1988	30 Years
Gatewood	Pleasanton, CA	200	—		6,796,511	20,249,392	—	759,788	6,796,511	21,009,179	27,805,690	(1,240,343	)	1985	30 Years
Geary Court Yard	San Francisco, CA	164	17,693,865		1,722,400	15,471,429	—	806,073	1,722,400	16,277,502	17,999,902	(4,216,747	)	1990	30 Years
Georgian Woods Combined (REIT)	Wheaton, MD	570	17,470,313		5,038,400	28,837,369	—	5,326,738	5,038,400	34,164,107	39,202,507	(11,659,269	)	1967	30 Years
Glastonbury Center	Glastonbury, CT	105	—		852,606	5,699,497	—	449,953	852,606	6,149,451	7,002,057	(1,003,526	)	1962	30 Years
Glen Arm Manor	Albany, GA	70	1,060,185		166,498	1,466,883	—	274,374	166,498	1,741,257	1,907,756	(378,507	)	1986	30 Years
Glen Grove	Wellesley, MA	125	3,795,038		1,344,601	8,988,383	—	513,431	1,344,601	9,501,814	10,846,415	(1,435,190	)	1979	30 Years
Glen Meadow	Franklin, MA	288	1,939,125		2,339,330	15,796,431	—	1,381,905	2,339,330	17,178,337	19,517,667	(2,901,375	)	1971	30 Years
GlenGarry Club	Bloomingdale, IL	250	(N	)	3,129,700	15,807,889	—	1,815,423	3,129,700	17,623,311	20,753,011	(4,657,682	)	1989	30 Years
Glenlake	Glendale Heights. IL	336	14,845,000		5,041,700	16,671,970	—	4,137,392	5,041,700	20,809,362	25,851,062	(5,898,252	)	1988	30 Years
Glenwood Village	Macon, GA	80	1,007,502		167,779	1,478,614	—	229,809	167,779	1,708,423	1,876,202	(381,714	)	1986	30 Years
Gore Meadows	Watertown, MA	—	—		—	163,697	—	—	—	163,697	163,697	—		(F)	30 Years

S-4

EQUITY RESIDENTIAL

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2004

							Cost Capitalized
							Subsequent to		Gross Amount Carried						Life Used to
					Initial Cost to		Acquisition		at Close of						Compute
Description					Company		(Improvements, net) (E)		Period 12/31/04						Depreciation in
Apartment						Building &		Building &		Building &		Accumulated		Date of	Latest Income
Name	Location	Units (J)	Encumbrances		Land	Fixtures	Land	Fixtures	Land	Fixtures (A)	Total (B)	Depreciation		Construction	Statement (C)
Gosnold Grove	East Falmouth, MA	33	595,899		124,296	830,891	—	105,169	124,296	936,060	1,060,355	(182,029	)	1978	30 Years
Gramercy Park	Houston, TX	384	—		3,957,000	22,075,243	—	1,272,760	3,957,000	23,348,002	27,305,002	(2,672,377	)	1998	30 Years
Granada Highlands	Malden, MA (G)	919	—		28,210,000	99,944,576	—	7,634,865	28,210,000	107,579,441	135,789,441	(20,617,153	)	1972	30 Years
Grand Marquis Condominium, LLC	Plantation, FL	198	—		917,800	9,140,076	—	1,371,969	917,800	10,512,046	11,429,846	(4,110,023	)	1987	30 Years
Grand Oasis Condominium, LLC	Coral Springs, FL	89	—		358,896	3,588,802	—	969,136	358,896	4,557,938	4,916,834	(1,522,680	)	1987	30 Years
Grand Reserve	Woodbury, MN	394	—		4,728,000	49,541,642	—	4,318,206	4,728,000	53,859,848	58,587,848	(7,364,568	)	2000	30 Years
Grandeville at River Place	Oviedo, FL	280	—		6,000,000	23,110,997	—	92,980	6,000,000	23,203,977	29,203,977	(1,013,863	)	2002	30 Years
Greenbriar Glen	Atlanta, GA	74	1,391,109		227,701	2,006,246	—	305,529	227,701	2,311,775	2,539,477	(445,174	)	1988	30 Years
Greenfield Village	Rocky Hill, CT	151	—		911,534	6,093,418	—	171,645	911,534	6,265,064	7,176,598	(1,012,392	)	1965	30 Years
Greengate (FL)	W. Palm Beach, FL	120	—		2,500,000	1,615,859	—	299,694	2,500,000	1,915,553	4,415,553	(391,409	)	1987	30 Years
Greenglen (Day)	Dayton, OH	76	—		204,289	1,800,172	—	298,289	204,289	2,098,461	2,302,750	(459,706	)	1983	30 Years
Greenglen II (Tol)	Toledo, OH	58	—		162,264	1,429,719	—	202,224	162,264	1,631,943	1,794,207	(332,135	)	1982	30 Years
Greenhaven	Union City, CA	250	10,975,000		7,507,000	15,210,399	—	1,391,472	7,507,000	16,601,871	24,108,871	(4,034,011	)	1983	30 Years
Greenhouse - Frey Road	Kennesaw, GA	489	(M	)	2,467,200	22,187,443	—	3,009,883	2,467,200	25,197,326	27,664,526	(9,938,727	)	1985	30 Years
Greenhouse - Holcomb Bridge	Alpharetta, GA	437	(M	)	2,143,300	19,291,427	—	3,021,223	2,143,300	22,312,650	24,455,950	(8,897,741	)	1985	30 Years
Greenhouse - Roswell	Roswell, GA	236	(M	)	1,220,000	10,974,727	—	1,894,090	1,220,000	12,868,818	14,088,818	(5,214,467	)	1985	30 Years
Greentree 1	Glen Burnie, MD	350	11,000,000		3,912,968	11,784,021	—	2,097,434	3,912,968	13,881,455	17,794,423	(3,376,484	)	1973	30 Years
Greentree 2	Glen Burnie, MD	239	—		2,700,000	8,246,737	—	990,411	2,700,000	9,237,148	11,937,148	(2,133,855	)	1973	30 Years
Greentree 3	Glen Burnie, MD	207	—		2,380,443	7,270,294	—	789,707	2,380,443	8,060,001	10,440,444	(1,872,059	)	1973	30 Years
Greentree I (GA) (REIT)	Thomasville, GA	43	629,393		84,750	762,659	—	178,917	84,750	941,577	1,026,327	(148,053	)	1983	30 Years
Greentree II (GA) (REIT)	Thomasville, GA	32	473,348		81,000	729,283	—	111,455	81,000	840,738	921,738	(131,091	)	1984	30 Years
Greenwood Villas	Lake Mary, FL	56	—		450,000	2,465,447	—	1,448	450,000	2,466,894	2,916,894	(47,049	)	1984	30 Years
Hall Place	Quincy, MA	90	—		3,150,800	5,121,950	—	511,811	3,150,800	5,633,760	8,784,560	(1,327,211	)	1998	30 Years
Hammocks Place	Miami, FL	296	(L	)	319,180	12,513,467	—	1,592,031	319,180	14,105,497	14,424,677	(5,886,184	)	1986	30 Years
Hampshire II	Elyria, OH	56	797,823		126,231	1,112,036	—	184,881	126,231	1,296,917	1,423,148	(267,287	)	1981	30 Years
Hampshire Place	Los Angeles, CA	259	19,958,653		10,806,000	30,331,904	—	4,735	10,806,000	30,336,638	41,142,638	(95,031	)	1989	30 Years
Hamptons	Puyallup, WA	230	—		1,119,200	10,075,844	—	976,491	1,119,200	11,052,335	12,171,535	(3,208,047	)	1991	30 Years
Harbinwood	Norcross, GA	72	—		236,761	2,086,122	—	274,307	236,761	2,360,429	2,597,190	(511,234	)	1985	30 Years
Harborview	San Pedro, CA	160	—		6,402,500	12,627,347	—	1,181,453	6,402,500	13,808,800	20,211,300	(3,970,184	)	1985	30 Years
Harbour Town	Boca Raton, FL	392	—		11,760,000	20,190,252	—	3,359,619	11,760,000	23,549,871	35,309,871	(4,567,867	)	1985	30 Years
Hartwick	Tipton, IN	44	—		123,791	1,090,729	—	171,410	123,791	1,262,140	1,385,930	(282,053	)	1982	30 Years
Harvest Grove I	Gahanna, OH	73	1,504,592		170,334	1,500,232	—	307,743	170,334	1,807,974	1,978,309	(401,278	)	1986	30 Years
Harvest Grove II	Gahanna, OH	57	—		148,792	1,310,818	—	190,011	148,792	1,500,829	1,649,620	(301,890	)	1987	30 Years
Hatcherway	Waycross, GA	64	684,375		96,885	853,716	—	239,832	96,885	1,093,549	1,190,434	(275,038	)	1986	30 Years
Hathaway	Long Beach, CA	385	—		2,512,500	22,611,912	—	3,076,704	2,512,500	25,688,615	28,201,115	(8,610,848	)	1987	30 Years
Hayfield Park	Burlington, KY	86	1,534,250		261,457	2,303,394	—	227,323	261,457	2,530,718	2,792,174	(528,945	)	1986	30 Years
Heathmoore (Eva)	Evansville, IN	73	1,039,481		162,375	1,430,747	—	265,042	162,375	1,695,788	1,858,163	(377,669	)	1984	30 Years
Heathmoore (KY)	Louisville, KY	62	—		156,840	1,381,730	—	246,181	156,840	1,627,910	1,784,750	(352,193	)	1983	30 Years
Heathmoore (MI)	Clinton Twp., MI	72	1,584,774		227,105	2,001,243	—	320,616	227,105	2,321,859	2,548,964	(487,239	)	1983	30 Years
Heathmoore I (IN)	Indianapolis, IN	55	1,145,909		144,557	1,273,702	—	231,132	144,557	1,504,834	1,649,391	(354,737	)	1983	30 Years
Heathmoore I (MI)	Canton, MI	60	1,521,755		232,064	2,044,227	—	265,673	232,064	2,309,900	2,541,963	(486,486	)	1986	30 Years
Heathmoore II (MI)	Canton, MI	51	—		170,433	1,501,697	—	168,207	170,433	1,669,903	1,840,336	(343,539	)	1986	30 Years
Heritage Green	Sturbridge, MA	130	2,703,422		835,313	5,583,898	—	531,188	835,313	6,115,086	6,950,399	(973,901	)	1974	30 Years
Heritage, The	Phoenix, AZ	204	—		1,211,205	13,136,903	—	667,629	1,211,205	13,804,533	15,015,738	(3,532,830	)	1995	30 Years
Heron Pointe	Boynton Beach, FL	192	—		1,546,700	7,774,676	—	956,899	1,546,700	8,731,575	10,278,275	(2,744,634	)	1989	30 Years
Heron Pointe (Atl)	Atlantic Beach, FL	99	1,566,550		214,332	1,888,814	—	378,016	214,332	2,266,830	2,481,162	(534,992	)	1986	30 Years
Heronwood (REIT)	Ft. Myers, FL	59	1,157,161		146,100	1,315,211	—	238,372	146,100	1,553,583	1,699,683	(229,006	)	1982	30 Years
Hickory Mill	Hilliard, OH	60	—		161,714	1,424,682	—	347,037	161,714	1,771,719	1,933,433	(388,013	)	1980	30 Years
Hickory Place	Gainesville, FL	70	1,246,264		192,453	1,695,454	—	292,252	192,453	1,987,706	2,180,160	(455,358	)	1983	30 Years
Hidden Acres	Sarasota, FL	94	1,601,965		253,139	2,230,579	—	355,532	253,139	2,586,110	2,839,249	(553,524	)	1987	30 Years
Hidden Lake	Sacramento, CA	272	15,165,000		1,715,000	12,263,475	—	1,029,490	1,715,000	13,292,965	15,007,965	(2,043,036	)	1985	30 Years
Hidden Lakes	Haltom City, TX	312	—		1,872,000	20,242,109	—	953,464	1,872,000	21,195,573	23,067,573	(4,880,561	)	1996	30 Years
Hidden Oaks	Cary, NC	216	—		1,178,600	10,614,135	—	1,597,072	1,178,600	12,211,208	13,389,808	(3,604,260	)	1988	30 Years
Hidden Palms	Tampa, FL	256	—		2,049,600	6,345,885	—	1,628,333	2,049,600	7,974,218	10,023,818	(2,502,051	)	1986	30 Years
Hidden Pines	Casselberry, FL	56	19,562		176,308	1,553,565	—	440,840	176,308	1,994,406	2,170,713	(455,713	)	1981	30 Years
Hidden Valley Club	Ann Arbor, MI	324	—		915,000	6,667,098	—	3,482,805	915,000	10,149,903	11,064,903	(7,326,836	)	1973	30 Years
High Meadow	Ellington, CT	100	4,115,841		583,679	3,901,774	—	217,220	583,679	4,118,994	4,702,673	(670,431	)	1975	30 Years
High Points	New Port Richey, FL	95	—		222,308	1,958,772	—	475,690	222,308	2,434,463	2,656,771	(566,044	)	1986	30 Years
High River	Tuscaloosa, AL (T)	152	3,569,223		208,108	3,663,221	—	689,898	208,108	4,353,119	4,561,226	(1,028,666	)	1978	30 Years
Highland Creste	Kent, WA	198	—		935,200	8,415,391	—	1,038,433	935,200	9,453,825	10,389,025	(2,897,831	)	1989	30 Years
Highland Glen	Westwood, MA	180	—		2,229,095	16,828,153	—	365,953	2,229,095	17,194,106	19,423,202	(2,472,591	)	1979	30 Years
Highland Glen II	Westwood, MA	—	—		603,508	400,524	—	—	603,508	400,524	1,004,032	—		(F)	30 Years
Highland Point	Aurora, CO	319	(Q	)	1,631,900	14,684,439	—	1,432,664	1,631,900	16,117,102	17,749,002	(4,668,312	)	1984	30 Years
Highline Oaks	Denver, CO	220	(M	)	1,057,400	9,340,249	—	1,340,899	1,057,400	10,681,148	11,738,548	(3,316,917	)	1986	30 Years
Hillcrest Villas	Crestview, FL	65	912,418		141,603	1,247,677	—	194,103	141,603	1,441,780	1,583,383	(325,706	)	1985	30 Years
Hillside Manor	Americus, GA	60	—		102,632	904,111	—	380,601	102,632	1,284,712	1,387,344	(316,348	)	1985	30 Years
Holly Ridge	Pembroke Park, FL	98	—		295,596	2,603,985	—	366,302	295,596	2,970,287	3,265,883	(638,237	)	1986	30 Years
Holly Sands I	Ft. Walton Bch., FL	72	—		190,942	1,682,524	—	303,321	190,942	1,985,845	2,176,787	(458,903	)	1985	30 Years
Holly Sands II	Ft. Walton Bch., FL	52	1,009,375		124,578	1,098,074	—	171,993	124,578	1,270,067	1,394,645	(292,134	)	1986	30 Years
Hudson Crossing	New York, NY (G)	259	—		23,420,000	70,069,263	—	2,334	23,420,000	70,071,597	93,491,597	(1,135,506	)	2003	30 Years
Hudson Pointe	Jersey City, NJ	182	—		5,148,500	41,596,476	—	96,488	5,148,500	41,692,964	46,841,463	(1,261,380	)	2003	30 Years
Hunt Club	Charlotte, NC	300	—		990,000	17,992,887	—	941,935	990,000	18,934,823	19,924,823	(4,396,636	)	1990	30 Years
Hunt Club II	Charlotte, NC	—	—		100,000	—	—	—	100,000	—	100,000	—		(F)	30 Years
Hunters Green	Fort Worth, TX	248	—		524,300	3,653,481	—	1,335,663	524,300	4,989,143	5,513,443	(2,362,518	)	1981	30 Years
Hunters Ridge	St. Louis, MO	198	10,680,000		994,500	8,913,997	—	1,488,157	994,500	10,402,154	11,396,654	(3,196,673	)	1986-1987	30 Years
Huntington Park	Everett, WA	381	—		1,597,500	14,367,864	—	1,590,150	1,597,500	15,958,014	17,555,514	(6,503,313	)	1991	30 Years
Independence Village	Reynoldsburg, OH	124	—		226,988	2,000,011	—	400,858	226,988	2,400,869	2,627,856	(556,417	)	1978	30 Years
Indian Bend	Scottsdale, AZ	276	—		1,075,700	9,675,133	—	1,992,973	1,075,700	11,668,106	12,743,806	(5,069,961	)	1973	30 Years
Indian Lake I	Morrow, GA	244	—		839,669	7,398,395	—	627,815	839,669	8,026,210	8,865,879	(1,617,767	)	1987	30 Years

S-5

EQUITY RESIDENTIAL

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2004

							Cost Capitalized
							Subsequent to		Gross Amount Carried						Life Used to
					Initial Cost to		Acquisition		at Close of						Compute
Description					Company		(Improvements, net) (E)		Period 12/31/04						Depreciation in
Apartment						Building &		Building &		Building &		Accumulated		Date of	Latest Income
Name	Location	Units (J)	Encumbrances		Land	Fixtures	Land	Fixtures	Land	Fixtures (A)	Total (B)	Depreciation		Construction	Statement (C)
Indian Ridge	Waltham, MA	—	9,240,826		5,878,374	19,025,500	—	—	5,878,374	19,025,500	24,903,875	—		(F)	30 Years
Indian Ridge I (REIT)	Tallahassee, FL	57	—		135,500	1,218,598	—	209,525	135,500	1,428,123	1,563,623	(228,546	)	1981	30 Years
Indian Ridge II (REIT)	Tallahassee, FL	39	—		94,300	849,192	—	97,914	94,300	947,106	1,041,406	(145,511	)	1982	30 Years
Indian Tree	Arvada, CO	168	—		881,225	4,552,815	—	1,574,849	881,225	6,127,664	7,008,889	(2,805,735	)	1983	30 Years
Indigo Springs	Kent, WA	278	—		1,270,500	11,446,902	—	1,902,334	1,270,500	13,349,236	14,619,736	(4,268,149	)	1991	30 Years
Iris Glen	Conyers, GA	79	1,661,685		270,458	2,383,030	—	269,213	270,458	2,652,242	2,922,700	(525,978	)	1984	30 Years
Ironwood at the Ranch	Westminster, CO	226	—		1,493,300	13,439,305	—	1,127,418	1,493,300	14,566,722	16,060,022	(4,142,728	)	1986	30 Years
Isle at Arrowhead Ranch	Glendale, AZ	256	—		1,650,237	19,593,123	—	689,680	1,650,237	20,282,804	21,933,041	(5,089,909	)	1996	30 Years
Isles at Sawgrass	Sunrise, FL	368	—		7,360,000	18,750,693	—	836,610	7,360,000	19,587,303	26,947,303	(2,417,186	)	1991-1995	30 Years
Ivory Wood	Bothell, WA	144	—		2,732,800	13,888,282	—	109,805	2,732,800	13,998,087	16,730,887	(397,217	)	2000	30 Years
Ivy Place	Atlanta, GA	122	—		802,950	7,228,257	—	1,108,006	802,950	8,336,262	9,139,212	(2,793,461	)	1978	30 Years
Jaclen Towers	Beverly, NJ	100	1,846,425		437,072	2,921,735	—	481,757	437,072	3,403,492	3,840,564	(589,283	)	1976	30 Years
James Street Crossing	Kent, WA	300	16,379,123		2,081,254	18,748,337	—	1,004,928	2,081,254	19,753,265	21,834,519	(5,271,007	)	1989	30 Years
Jefferson Way I	Orange Park, FL	56	1,000,621		147,799	1,302,268	—	320,768	147,799	1,623,036	1,770,835	(352,958	)	1987	30 Years
Junipers at Yarmouth	Yarmouth, ME	225	—		1,355,700	7,860,135	—	1,358,073	1,355,700	9,218,208	10,573,908	(2,911,277	)	1970	30 Years
Jupiter Cove I	Jupiter, FL	63	1,504,253		233,932	2,060,900	—	411,275	233,932	2,472,174	2,706,107	(562,196	)	1987	30 Years
Jupiter Cove II	Jupiter, FL	61	1,485,940		1,220,000	483,833	—	256,117	1,220,000	739,950	1,959,950	(174,000	)	1987	30 Years
Jupiter Cove III	Jupiter, FL	63	1,582,555		242,010	2,131,722	—	251,001	242,010	2,382,723	2,624,733	(482,176	)	1987	30 Years
Kempton Downs	Gresham, OR	278	—		1,217,349	10,943,372	—	1,935,825	1,217,349	12,879,197	14,096,545	(4,894,670	)	1990	30 Years
Ketwood	Kettering, OH	93	—		266,443	2,347,655	—	363,454	266,443	2,711,109	2,977,552	(608,337	)	1979	30 Years
Keystone	Austin, TX	166	—		498,500	4,487,295	—	1,305,265	498,500	5,792,560	6,291,060	(2,440,621	)	1981	30 Years
Kings Colony	Savannah, GA	89	1,914,070		230,149	2,027,865	—	269,045	230,149	2,296,910	2,527,059	(511,926	)	1987	30 Years
Kingsport	Alexandria, VA	415			1,262,250	12,198,024	—	3,249,132	1,262,250	15,447,156	16,709,406	(5,868,986	)	1986	30 Years
Kirby Place	Houston, TX	362	—		3,621,600	25,896,774	—	1,279,979	3,621,600	27,176,753	30,798,353	(7,145,671	)	1994	30 Years
La Mirage	San Diego, CA	1,070	—		28,895,200	95,567,943	—	5,398,766	28,895,200	100,966,709	129,861,909	(27,009,669	)	1988/1992	30 Years
La Mirage IV	San Diego, CA	340	—		6,000,000	47,449,353	—	31,426	6,000,000	47,480,779	53,480,779	(5,207,446	)	2001	30 Years
La Tour Fontaine	Houston, TX	162	—		2,916,000	15,917,178	—	892,412	2,916,000	16,809,591	19,725,591	(3,800,140	)	1994	30 Years
Ladera	Phoenix, AZ	248	(Q	)	2,978,879	20,640,453	—	676,946	2,978,879	21,317,400	24,296,279	(5,342,405	)	1995	30 Years
Laguna Clara	Santa Clara, CA	264	16,980,452		13,642,420	29,707,475	—	139,451	13,642,420	29,846,926	43,489,346	(1,129,028	)	1972	30 Years
Lakes at Vinings	Atlanta, GA	464	20,928,154		6,498,000	21,832,252	—	2,133,971	6,498,000	23,966,223	30,464,223	(6,102,433	)	1972/1975	30 Years
Lakeshore at Preston	Plano, TX	302	—		3,325,800	15,208,348	—	962,054	3,325,800	16,170,401	19,496,201	(3,938,455	)	1992	30 Years
Lakeshore I (GA)	Ft. Oglethorpe, GA	79	1,202,296		169,375	1,492,378	—	349,287	169,375	1,841,665	2,011,040	(453,172	)	1986	30 Years
Lakeview	Lodi, CA	138	7,286,000		950,000	5,750,629	—	988,476	950,000	6,739,105	7,689,105	(1,030,871	)	1983	30 Years
Lakeville Resort	Petaluma, CA	492	—		2,736,500	24,610,651	—	3,030,474	2,736,500	27,641,124	30,377,624	(8,675,873	)	1984	30 Years
Lakewood	Tulsa, OK	152	5,600,000		855,000	6,480,729	—	662,558	855,000	7,143,287	7,998,287	(1,180,057	)	1985	30 Years
Lakewood Greens	Dallas, TX	252	7,766,087		2,019,600	9,026,907	—	662,722	2,019,600	9,689,628	11,709,228	(2,491,710	)	1986	30 Years
Lakewood Oaks	Dallas, TX	352	—		1,631,600	14,686,192	—	2,133,304	1,631,600	16,819,495	18,451,095	(6,532,548	)	1987	30 Years
Landera	San Antonio, TX	184	—		766,300	6,896,811	—	1,108,443	766,300	8,005,255	8,771,555	(2,533,836	)	1983	30 Years
Landings at Port Imperial	W. New York, NJ	276	—		27,246,045	37,741,050	—	509,265	27,246,045	38,250,315	65,496,360	(5,428,415	)	1999	30 Years
Landings of Lake Zurich	Lake Zurich, IL	206	16,800,000		2,250,338	17,668,851	—	279,231	2,250,338	17,948,082	20,198,421	(571,857	)	2000	30 Years
Lantern Cove	Foster City, CA	232	36,403,000		6,945,000	21,945,503	—	846,634	6,945,000	22,792,136	29,737,136	(3,026,656	)	1985	30 Years
Larkspur I (Hil)	Hilliard, OH	60	—		179,628	1,582,519	—	311,026	179,628	1,893,545	2,073,173	(416,014	)	1983	30 Years
Larkspur Shores	Hilliard, OH	342	—		17,107,300	31,399,237	—	3,629,618	17,107,300	35,028,855	52,136,155	(9,052,654	)	1983	30 Years
Larkspur Woods	Sacramento, CA	232	—		5,802,900	14,576,106	—	1,207,348	5,802,900	15,783,454	21,586,354	(4,291,619	)	1989/1993	30 Years
LaSalle	Beaverton, OR (G)	554	33,793,865		7,202,000	35,877,612	—	956,081	7,202,000	36,833,692	44,035,692	(3,023,189	)	1998	30 Years
Laurel Bay	Ypsilanti, MI	68	—		186,004	1,639,366	—	281,881	186,004	1,921,247	2,107,251	(391,457	)	1989	30 Years
Laurel Glen	Acworth, GA	81	1,655,375		289,509	2,550,891	—	244,329	289,509	2,795,220	3,084,729	(555,275	)	1986	30 Years
Laurel Ridge	Chapel Hill, NC	160	—		160,000	3,206,076	—	3,522,787	160,000	6,728,863	6,888,863	(4,255,349	)	1975	30 Years
Laurel Ridge II	Chapel Hill, NC	—	—		22,551	—	—	—	22,551	—	22,551	—		(F)	30 Years
Legacy at Highlands Ranch	Highlands Ranch, CO	422	24,830,208		6,330,000	37,556,449	—	27,300	6,330,000	37,583,749	43,913,749	(337,167	)	1999	30 Years
Legacy Park Central	Concord, CA	259	36,210,339		6,469,230	44,565,469	—	14,786	6,469,230	44,580,255	51,049,485	(1,142,450	)	2003	30 Years
Legends at Preston	Morrisville, NC	382	(U	)	3,056,000	27,150,721	—	454,700	3,056,000	27,605,420	30,661,420	(4,217,275	)	2000	30 Years
Lexford Apartment Homes	Miami, FL	72	1,251,771		191,986	1,691,254	—	249,229	191,986	1,940,482	2,132,468	(379,834	)	1987	30 Years
Lexington Farm	Alpharetta, GA	352	—		3,521,900	22,888,305	—	937,216	3,521,900	23,825,522	27,347,422	(5,376,439	)	1995	30 Years
Lexington Glen	Atlanta, GA	480	—		5,760,000	40,190,507	—	2,444,677	5,760,000	42,635,184	48,395,184	(9,549,983	)	1990	30 Years
Lexington Park	Orlando, FL	252	—		2,016,000	12,346,726	—	1,302,812	2,016,000	13,649,537	15,665,537	(3,353,117	)	1988	30 Years
Liberty Park	Brain Tree, MA	202	26,500,000		5,977,504	26,748,835	—	245,445	5,977,504	26,994,280	32,971,784	(1,678,470	)	2000	30 Years
Lincoln Heights	Quincy, MA	336	(R	)	5,928,400	33,595,262	—	1,124,674	5,928,400	34,719,936	40,648,336	(8,698,107	)	1991	30 Years
Lindendale	Columbus, OH	77	1,246,157		209,159	1,842,816	—	316,167	209,159	2,158,982	2,368,141	(473,320	)	1987	30 Years
Link Terrace	Hinesville, GA	54	—		121,839	1,073,581	—	206,261	121,839	1,279,841	1,401,680	(275,218	)	1984	30 Years
Little Cottonwoods	Tempe, AZ	379	—		3,050,133	26,991,689	—	1,491,773	3,050,133	28,483,462	31,533,595	(7,464,295	)	1984	30 Years
Lodge (OK), The	Tulsa, OK	208	—		313,371	2,750,936	—	2,020,555	313,371	4,771,491	5,084,862	(3,672,328	)	1979	30 Years
Lodge (TX), The	San Antonio, TX	384	—		1,363,636	7,464,586	—	3,174,967	1,363,636	10,639,553	12,003,189	(6,053,471	)	1989/1990	30 Years
Lofton Place	Tampa, FL	280	—		2,240,000	16,679,214	—	1,479,566	2,240,000	18,158,780	20,398,780	(4,319,588	)	1988	30 Years
Longfellow Glen	Sudbury, MA	120	4,215,246		1,094,273	7,314,994	—	1,530,341	1,094,273	8,845,335	9,939,609	(1,361,991	)	1984	30 Years
Longfellow Place	Boston, MA (G)	710	—		53,164,160	183,940,619	—	21,372,867	53,164,160	205,313,486	258,477,646	(41,568,834	)	1975	30 Years
Longwood	Decatur, GA	268	—		1,454,048	13,087,837	—	1,082,842	1,454,048	14,170,679	15,624,727	(5,533,304	)	1992	30 Years
Longwood (KY)	Lexington, KY	60	—		146,309	1,289,042	—	247,496	146,309	1,536,538	1,682,847	(348,197	)	1985	30 Years
Loomis Manor	West Hartford, CT	43	(P	)	422,350	2,823,326	—	249,410	422,350	3,072,735	3,495,086	(503,715	)	1948	30 Years
Madison at Cedar Springs	Dallas, TX	380	(R	)	2,470,000	33,194,620	—	798,402	2,470,000	33,993,023	36,463,023	(7,487,590	)	1995	30 Years
Madison at Chase Oaks	Plano, TX	470	(R	)	3,055,000	28,932,885	—	1,319,755	3,055,000	30,252,640	33,307,640	(6,895,431	)	1995	30 Years
Madison at River Sound	Lawrenceville, GA	586	(U	)	3,666,999	47,387,106	—	1,109,283	3,666,999	48,496,389	52,163,388	(10,688,084	)	1996	30 Years
Madison at Round Grove	Lewisville, TX	404	(Q	)	2,626,000	25,682,373	—	1,105,771	2,626,000	26,788,144	29,414,144	(6,134,751	)	1995	30 Years
Madison at Scofield Farms	Austin, TX	260	12,228,292		2,080,000	14,597,971	—	912,614	2,080,000	15,510,585	17,590,585	(2,659,953	)	1996	30 Years
Madison at Stone Creek	Austin, TX	390	—		2,535,000	22,611,700	—	1,076,877	2,535,000	23,688,576	26,223,576	(5,565,233	)	1995	30 Years
Madison at the Arboretum	Austin, TX	161	—		1,046,500	9,638,269	—	745,152	1,046,500	10,383,421	11,429,921	(2,512,190	)	1995	30 Years
Madison at Walnut Creek	Austin, TX	342	—		2,737,600	14,623,574	—	1,293,096	2,737,600	15,916,669	18,654,269	(4,460,782	)	1994	30 Years
Madison at Wells Branch	Austin, TX	300	—		2,377,344	16,370,879	—	1,172,821	2,377,344	17,543,699	19,921,044	(3,059,418	)	1995	30 Years
Madison on Melrose	Richardson, TX	200	—		1,300,000	15,096,551	—	465,462	1,300,000	15,562,013	16,862,013	(3,500,152	)	1995	30 Years

S-6

EQUITY RESIDENTIAL

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2004

							Cost Capitalized
							Subsequent to		Gross Amount Carried						Life Used to
					Initial Cost to		Acquisition		at Close of						Compute
Description					Company		(Improvements, net) (E)		Period 12/31/04						Depreciation in
Apartment						Building &		Building &		Building &		Accumulated		Date of	Latest Income
Name	Location	Units (J)	Encumbrances		Land	Fixtures	Land	Fixtures	Land	Fixtures (A)	Total (B)	Depreciation		Construction	Statement (C)
Madison on the Parkway	Dallas, TX	376	—		2,444,000	22,505,043	—	998,686	2,444,000	23,503,729	25,947,729	(5,438,721	)	1995	30 Years
Magnolia at Whitlock	Marietta, GA	152	—		132,979	1,526,005	—	3,543,532	132,979	5,069,537	5,202,516	(2,887,149	)	1971	30 Years
Manchester (REIT)	Jacksonville, FL	78	1,203,850		184,100	1,657,194	—	270,348	184,100	1,927,541	2,111,641	(304,856	)	1985	30 Years
Marabou Mills I	Indianapolis, IN	86	1,277,316		224,178	1,974,952	—	262,450	224,178	2,237,402	2,461,580	(504,740	)	1986	30 Years
Marabou Mills II	Indianapolis, IN	63	—		192,186	1,693,220	—	135,414	192,186	1,828,634	2,020,821	(385,310	)	1987	30 Years
Marabou Mills III	Indianapolis, IN	59	1,140,520		171,557	1,511,602	—	114,701	171,557	1,626,303	1,797,860	(338,114	)	1987	30 Years
Mariner Club (FL)	Pembroke Pines, FL	304	—		1,824,500	20,771,566	—	2,136,280	1,824,500	22,907,846	24,732,346	(5,052,355	)	1988	30 Years
Mariners Wharf	Orange Park, FL	272	—		1,861,200	16,744,951	—	1,128,478	1,861,200	17,873,429	19,734,629	(4,770,601	)	1989	30 Years
Marks	Englewood, CO (G)	616	19,195,000		4,928,500	44,621,814	—	3,039,690	4,928,500	47,661,503	52,590,003	(13,362,054	)	1987	30 Years
Marquessa	Corona Hills, CA	336	—		6,888,500	21,604,584	—	1,750,384	6,888,500	23,354,968	30,243,468	(6,245,286	)	1992	30 Years
Marsh Landing I	Brunswick, GA	57	—		133,193	1,173,573	—	329,630	133,193	1,503,203	1,636,396	(353,922	)	1984	30 Years
Marshlanding II	Brunswick, GA	48	—		111,187	979,679	—	178,555	111,187	1,158,234	1,269,422	(261,647	)	1986	30 Years
Martha Lake	Lynnwood, WA	155	—		821,200	7,405,070	—	1,182,229	821,200	8,587,299	9,408,499	(2,550,229	)	1991	30 Years
Martins Landing	Roswell, GA	300	11,840,996		4,802,000	12,899,972	—	1,464,149	4,802,000	14,364,121	19,166,121	(3,762,920	)	1972	30 Years
McDowell Place	Naperville, IL	400	(R	)	2,580,400	23,209,629	—	2,444,503	2,580,400	25,654,132	28,234,532	(7,943,825	)	1988	30 Years
Meadow Ridge	Norwich, CT	120	4,314,082		747,957	4,999,937	—	171,799	747,957	5,171,737	5,919,693	(844,335	)	1987	30 Years
Meadowland	Bogart, GA	60	—		152,395	1,342,663	—	85,687	152,395	1,428,350	1,580,745	(303,395	)	1984	30 Years
Meadowood (Cin)	Cincinnati, OH	106	—		330,734	2,913,731	—	472,251	330,734	3,385,982	3,716,717	(717,874	)	1985	30 Years
Meadowood (Cuy)	Cuyahoga Falls, OH	59	—		201,407	1,774,784	—	259,350	201,407	2,034,134	2,235,540	(411,178	)	1985	30 Years
Meadowood (Fra)	Franklin, IN	51	923,896		129,252	1,138,733	—	206,312	129,252	1,345,045	1,474,297	(316,357	)	1983	30 Years
Meadowood (New)	Newburgh, IN	65	901,306		131,546	1,159,064	—	183,765	131,546	1,342,829	1,474,375	(297,143	)	1984	30 Years
Meadowood (Nic)	Nicholasville, KY	67	1,306,284		173,223	1,526,283	—	275,486	173,223	1,801,769	1,974,992	(406,242	)	1983	30 Years
Meadowood (Tem)	Temperance, MI	57	1,259,217		173,675	1,530,262	—	164,710	173,675	1,694,972	1,868,647	(343,340	)	1984	30 Years
Meadowood Apts. (Man)	Mansfield, OH	50	—		118,504	1,044,002	—	170,785	118,504	1,214,787	1,333,291	(272,630	)	1983	30 Years
Meadowood I (GA)	Norcross, GA	61	—		205,468	1,810,393	—	270,600	205,468	2,080,993	2,286,460	(443,539	)	1982	30 Years
Meadowood I (OH)	Columbus, OH	60	—		146,912	1,294,458	—	365,004	146,912	1,659,462	1,806,374	(397,148	)	1984	30 Years
Meadowood II (GA)	Norcross, GA	51	—		176,968	1,559,544	—	161,838	176,968	1,721,383	1,898,351	(366,655	)	1984	30 Years
Meadowood II (OH)	Columbus, OH	23	451,232		57,802	509,199	—	131,106	57,802	640,305	698,106	(147,229	)	1985	30 Years
Meadows I (OH), The	Columbus, OH	60	—		150,800	1,328,616	—	246,697	150,800	1,575,313	1,726,113	(362,183	)	1985	30 Years
Meadows II (OH), The	Columbus, OH	60	1,111,775		186,636	1,644,521	—	226,121	186,636	1,870,642	2,057,278	(411,956	)	1987	30 Years
Meldon Place	Toledo, OH	127	2,204,599		288,434	2,541,701	—	592,118	288,434	3,133,819	3,422,253	(817,209	)	1978	30 Years
Merrifield	Salisbury, MD	95	1,850,593		268,712	2,367,645	—	322,539	268,712	2,690,183	2,958,895	(555,614	)	1988	30 Years
Merrill Creek	Lakewood, WA	149	—		814,200	7,330,606	—	455,885	814,200	7,786,491	8,600,691	(2,205,184	)	1994	30 Years
Merritt at Satellite Place	Duluth, GA	424	(S	)	3,400,000	30,115,674	—	640,803	3,400,000	30,756,478	34,156,478	(5,799,699	)	1999	30 Years
Mesa Del Oso	Albuquerque, NM	221	10,575,735		4,305,000	12,112,957	—	550,912	4,305,000	12,663,869	16,968,869	(1,941,777	)	1983	30 Years
Miguel Place	Port Richey, FL	91	1,403,066		199,349	1,756,482	—	465,526	199,349	2,222,009	2,421,358	(515,996	)	1987	30 Years
Mill Creek	Milpitas, CA	516	—		12,858,693	57,168,503	—	944,669	12,858,693	58,113,172	70,971,865	(3,592,125	)	1991	30 Years
Mill Pond	Millersville, MD	240	7,300,000		2,880,000	8,468,462	—	1,225,792	2,880,000	9,694,254	12,574,254	(2,423,456	)	1984	30 Years
Millburn	Stow, OH	52	—		192,062	1,692,276	—	243,634	192,062	1,935,910	2,127,972	(377,177	)	1984	30 Years
Millburn Court I	Centerville, OH	65	—		260,000	1,246,757	—	128,394	260,000	1,375,150	1,635,150	(235,950	)	1979	30 Years
Millburn Court II	Centerville, OH	51	847,143		122,870	1,082,698	—	306,157	122,870	1,388,854	1,511,725	(349,669	)	1981	30 Years
Mira Flores	Palm Beach Gardens, FL	352	—		7,040,000	22,515,299	—	550,895	7,040,000	23,066,194	30,106,194	(2,592,195	)	1996	30 Years
Mission Bay	Orlando, FL	304	—		2,432,000	21,623,560	—	1,175,146	2,432,000	22,798,706	25,230,706	(5,243,256	)	1991	30 Years
Mission Hills	Oceanside, CA	282	9,978,164		5,640,000	21,130,732	—	724,441	5,640,000	21,855,173	27,495,173	(3,431,159	)	1984	30 Years
Misty Woods	Cary, NC	360	—		720,790	18,063,934	—	2,276,854	720,790	20,340,788	21,061,578	(5,440,061	)	1984	30 Years
Montecito	Valencia, CA	210	—		8,400,000	24,709,146	—	511,649	8,400,000	25,220,795	33,620,795	(3,587,840	)	1999	30 Years
Montevista	Dallas, TX	350	—		3,931,550	19,788,568	—	680,654	3,931,550	20,469,223	24,400,773	(2,179,403	)	2000	30 Years
Montgomery Court I (MI)	Haslett, MI	59	1,115,312		156,298	1,377,153	—	356,839	156,298	1,733,992	1,890,290	(383,878	)	1984	30 Years
Montgomery Court I (OH)	Dublin, OH	60	1,193,960		163,755	1,442,643	—	386,489	163,755	1,829,132	1,992,887	(426,340	)	1985	30 Years
Montgomery Court II (OH)	Dublin, OH	57	—		149,734	1,319,417	—	213,328	149,734	1,532,746	1,682,479	(337,008	)	1986	30 Years
Montierra	Scottsdale, AZ	249	(Q	)	3,455,000	17,266,787	—	429,480	3,455,000	17,696,266	21,151,266	(3,670,042	)	1999	30 Years
Montierra (CA)	San Diego, CA	272	17,613,777		8,160,000	29,360,938	—	1,282,390	8,160,000	30,643,328	38,803,328	(4,791,765	)	1990	30 Years
Montrose Square	Columbus, OH	129	—		193,266	1,703,260	—	512,715	193,266	2,215,975	2,409,241	(564,131	)	1987	30 Years
Morgan Trace	Union City, GA	80	—		239,102	2,105,728	—	336,135	239,102	2,441,863	2,680,965	(507,307	)	1986	30 Years
Morningside	Scottsdale, AZ	160	—		670,470	12,607,976	—	771,645	670,470	13,379,621	14,050,091	(3,463,821	)	1989	30 Years
Mosswood I	Winter Springs, FL	58	—		163,294	1,438,796	—	393,746	163,294	1,832,541	1,995,835	(392,232	)	1981	30 Years
Mosswood II	Winter Springs, FL	89	1,433,020		275,330	2,426,158	—	501,847	275,330	2,928,005	3,203,335	(609,524	)	1982	30 Years
Mountain Park Ranch	Phoenix, AZ	240	(O	)	1,662,332	18,260,276	—	947,522	1,662,332	19,207,798	20,870,130	(5,016,400	)	1994	30 Years
Mountain Terrace	Stevenson Ranch, CA	510	—		3,966,500	35,814,995	—	1,861,843	3,966,500	37,676,838	41,643,338	(10,841,998	)	1992	30 Years
Nehoiden Glen	Needham, MA	61	1,579,980		634,538	4,241,755	—	269,303	634,538	4,511,057	5,145,595	(696,968	)	1978	30 Years
Newberry I	Lansing, MI	62	—		183,509	1,616,913	—	294,682	183,509	1,911,596	2,095,105	(429,211	)	1985	30 Years
Newberry II	Lansing, MI	48	—		142,292	1,253,951	—	150,661	142,292	1,404,612	1,546,905	(313,508	)	1986	30 Years
Newport Heights	Tukwila, WA	80	—		391,200	3,522,780	—	668,608	391,200	4,191,388	4,582,588	(1,687,193	)	1985	30 Years
Noonan Glen	Winchester, MA	18	463,505		151,344	1,011,700	—	140,922	151,344	1,152,623	1,303,966	(188,712	)	1983	30 Years
North Hill	Atlanta, GA	420	15,005,000		2,525,300	18,550,989	—	5,196,592	2,525,300	23,747,581	26,272,881	(8,335,012	)	1984	30 Years
Northampton 1	Largo, MD	344	19,151,947		1,843,200	17,528,381	—	3,533,447	1,843,200	21,061,828	22,905,028	(8,657,186	)	1977	30 Years
Northampton 2	Largo, MD	276	—		1,513,500	14,246,990	—	1,839,013	1,513,500	16,086,003	17,599,503	(6,068,531	)	1988	30 Years
Northglen	Valencia, CA	234	14,526,153		9,360,000	20,778,553	—	615,241	9,360,000	21,393,794	30,753,794	(3,155,237	)	1988	30 Years
Northridge	Pleasant Hill, CA	221	—		5,527,800	14,691,705	—	1,937,959	5,527,800	16,629,664	22,157,464	(4,306,125	)	1974	30 Years
Northridge (GA)	Carrolton, GA	77	—		238,811	2,104,181	—	193,708	238,811	2,297,889	2,536,699	(480,896	)	1985	30 Years
Northrup Court I	Coraopolis, PA	60	1,280,579		189,246	1,667,463	—	205,942	189,246	1,873,405	2,062,651	(397,996	)	1985	30 Years
Northrup Court II	Coraopolis, PA	49	—		157,190	1,385,018	—	124,810	157,190	1,509,828	1,667,018	(322,481	)	1985	30 Years
Northwoods Village	Cary, NC	228	—		1,369,700	11,460,337	—	1,682,449	1,369,700	13,142,786	14,512,486	(3,858,921	)	1986	30 Years
Norton Glen	Norton, MA	150	4,090,315		1,012,556	6,768,727	—	1,544,561	1,012,556	8,313,288	9,325,843	(1,417,387	)	1983	30 Years
Nova Glen I	Daytona Beach, FL	62	—		142,086	1,251,930	—	476,522	142,086	1,728,452	1,870,538	(431,168	)	1984	30 Years
Nova Glen II	Daytona Beach, FL	81	—		175,168	1,543,420	—	421,224	175,168	1,964,644	2,139,811	(443,569	)	1986	30 Years
Novawood I	Daytona Beach, FL	58	149,213		122,311	1,077,897	—	392,066	122,311	1,469,963	1,592,275	(319,923	)	1980	30 Years
Novawood II	Daytona Beach, FL	61	—		144,401	1,272,484	—	257,493	144,401	1,529,977	1,674,379	(316,622	)	1980	30 Years
Oak Gardens	Hollywood, FL	105	—		329,968	2,907,288	—	325,962	329,968	3,233,249	3,563,217	(667,609	)	1988	30 Years

S-7

EQUITY RESIDENTIAL

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2004

							Cost Capitalized
							Subsequent to		Gross Amount Carried						Life Used to
					Initial Cost to		Acquisition		at Close of						Compute
Description					Company		(Improvements, net) (E)		Period 12/31/04						Depreciation in
Apartment						Building &		Building &		Building &		Accumulated		Date of	Latest Income
Name	Location	Units (J)	Encumbrances		Land	Fixtures	Land	Fixtures	Land	Fixtures (A)	Total (B)	Depreciation		Construction	Statement (C)
Oak Mill 2	Germantown, MD	192	9,600,000		854,133	10,233,783	—	1,343,262	854,133	11,577,045	12,431,178	(3,534,283	)	1985	30 Years
Oak Park North	Agoura Hills, CA	220	(I	)	1,706,900	15,362,666	—	849,534	1,706,900	16,212,200	17,919,100	(5,308,426	)	1990	30 Years
Oak Park South	Agoura Hills, CA	224	(I	)	1,683,800	15,154,608	—	934,602	1,683,800	16,089,210	17,773,010	(5,318,141	)	1989	30 Years
Oak Ridge	Clermont, FL	63	1,133,804		173,617	1,529,936	—	337,313	173,617	1,867,250	2,040,866	(448,021	)	1985	30 Years
Oak Shade	Orange City, FL	82	—		229,403	2,021,290	—	379,036	229,403	2,400,326	2,629,729	(490,223	)	1985	30 Years
Oakland Hills	Margate, FL	189	—		3,040,000	4,930,604	—	623,229	3,040,000	5,553,832	8,593,832	(1,029,500	)	1987	30 Years
Oakley Woods	Union City, GA	60	1,039,270		165,449	1,457,485	—	333,530	165,449	1,791,015	1,956,464	(416,167	)	1984	30 Years
Oaks	Santa Clarita, CA	520	45,346,636		23,400,000	61,020,438	—	592,808	23,400,000	61,613,246	85,013,246	(3,397,866	)	2000	30 Years
Oaks (NC)	Charlotte, NC	318	—		2,196,744	23,601,540	—	592,535	2,196,744	24,194,075	26,390,819	(5,411,979	)	1996	30 Years
Oakwood Manor	Hollywood, FL	63	—		173,247	1,525,973	—	107,001	173,247	1,632,974	1,806,221	(341,687	)	1986	30 Years
Oakwood Village (FL)	Hudson, FL	75	—		145,547	1,282,427	—	461,832	145,547	1,744,259	1,889,806	(440,445	)	1986	30 Years
Oakwood Village (FL) II	Hudson, FL	—	—		31,734	—	—	—	31,734	—	31,734	—		(F)	30 Years
Oakwood Village (GA)	Augusta, GA	70	—		161,174	1,420,119	—	200,283	161,174	1,620,402	1,781,576	(349,989	)	1985	30 Years
Ocean Walk	Key West, FL	297	21,079,921		2,838,749	25,545,009	—	1,225,250	2,838,749	26,770,259	29,609,007	(6,908,706	)	1990	30 Years
Old Archer Court	Gainesville, FL	72	901,193		170,323	1,500,735	—	385,311	170,323	1,886,046	2,056,370	(460,544	)	1977	30 Years
Old Mill Glen	Maynard, MA	50	1,724,089		396,756	2,652,233	—	245,151	396,756	2,897,383	3,294,139	(461,710	)	1983	30 Years
Olde Redmond Place	Redmond, WA	192	(R	)	4,807,100	14,126,038	—	1,997,525	4,807,100	16,123,563	20,930,663	(3,665,972	)	1986	30 Years
Olivewood (MI)	Sterling Hts., MI	150	—		519,167	4,574,905	—	664,845	519,167	5,239,750	5,758,917	(1,109,021	)	1986	30 Years
Olivewood I	Indianapolis, IN	62	—		184,701	1,627,420	—	432,521	184,701	2,059,941	2,244,643	(479,917	)	1985	30 Years
Olivewood II	Indianapolis, IN	67	1,202,744		186,235	1,640,571	—	274,675	186,235	1,915,245	2,101,480	(426,409	)	1986	30 Years
Olympus Towers	Seattle, WA (G)	328	—		14,752,034	73,376,841	—	167,959	14,752,034	73,544,800	88,296,834	(2,735,326	)	2000	30 Years
One Eton Square	Tulsa, OK	448	—		1,570,100	14,130,937	—	2,845,077	1,570,100	16,976,014	18,546,114	(5,276,884	)	1985	30 Years
Orchard Ridge	Lynnwood, WA	104	—		480,600	4,372,033	—	670,847	480,600	5,042,880	5,523,480	(1,990,358	)	1988	30 Years
Overlook Manor	Frederick, MD	108	—		1,299,100	3,930,931	—	1,116,086	1,299,100	5,047,017	6,346,117	(1,307,187	)	1980/1985	30 Years
Overlook Manor II	Frederick, MD	182	5,235,000		2,186,300	6,262,597	—	313,889	2,186,300	6,576,486	8,762,786	(1,645,955	)	1980/1985	30 Years
Overlook Manor III	Frederick, MD	64	—		1,026,300	3,027,390	—	157,356	1,026,300	3,184,746	4,211,046	(778,826	)	1980/1985	30 Years
Paces Station	Atlanta, GA	610	—		4,801,500	32,548,053	—	4,487,857	4,801,500	37,035,909	41,837,409	(11,074,115	)	1984-1988/1989	30 Years
Palladia	Hillsboro, OR	497	—		6,461,000	44,888,156	—	338,685	6,461,000	45,226,841	51,687,841	(5,760,211	)	2000	30 Years
Palm Place	Sarasota. FL	80	—		248,315	2,188,339	—	467,814	248,315	2,656,153	2,904,468	(616,666	)	1984	30 Years
Palm Side (REIT)	Palm Bay, FL	87	1,054,701		116,334	1,047,004	—	55,317	116,334	1,102,321	1,218,655	(64,988	)	1986	30 Years
Panther Ridge	Federal Way, WA	260	—		1,055,800	9,506,117	—	1,109,293	1,055,800	10,615,410	11,671,210	(3,330,910	)	1980	30 Years
Paradise Pointe	Dania, FL	320	—		1,913,414	17,417,956	—	3,422,034	1,913,414	20,839,990	22,753,404	(7,724,137	)	1987-90	30 Years
Parc Royale	Houston, TX	171	—		2,223,000	11,936,833	—	1,381,767	2,223,000	13,318,599	15,541,599	(3,048,204	)	1994	30 Years
Park Meadow	Gilbert, AZ	224	—		835,217	15,120,769	—	1,046,479	835,217	16,167,248	17,002,465	(4,211,667	)	1986	30 Years
Park Place (MN)	Plymouth, MN	250	—		1,219,900	10,964,119	—	1,618,488	1,219,900	12,582,607	13,802,507	(4,113,558	)	1986	30 Years
Park Place (TX)	Houston, TX	229	—		1,603,000	12,054,926	—	704,991	1,603,000	12,759,917	14,362,917	(3,263,810	)	1996	30 Years
Park Place II	Plymouth, MN	250	—		1,216,100	10,951,698	—	1,427,768	1,216,100	12,379,465	13,595,565	(3,938,123	)	1986	30 Years
Park Place West (CT)	West Hartford, CT	63	—		466,243	3,116,742	—	166,607	466,243	3,283,350	3,749,593	(538,740	)	1961	30 Years
Park West (CA)	Los Angeles, CA	444	—		3,033,500	27,302,383	—	2,843,743	3,033,500	30,146,126	33,179,626	(10,352,251	)	1987/90	30 Years
Park West (TX)	Austin, TX	196	—		648,705	4,738,542	—	1,283,557	648,705	6,022,099	6,670,804	(2,641,943	)	1985	30 Years
Parkfield	Denver, CO	476	—		8,330,000	28,667,618	—	468,924	8,330,000	29,136,542	37,466,542	(4,316,037	)	2000	30 Years
Parkside	Union City, CA	208	—		6,246,700	11,827,453	—	2,673,000	6,246,700	14,500,453	20,747,153	(3,910,813	)	1979	30 Years
Parkview Terrace	Redlands, CA	558	—		4,969,200	35,653,777	—	3,230,594	4,969,200	38,884,371	43,853,571	(9,727,223	)	1986	30 Years
Parkville (Col)	Columbus, OH	100	1,672,484		150,433	1,325,756	—	390,618	150,433	1,716,374	1,866,807	(458,705	)	1978	30 Years
Parkville (IN)	Gas City, IN	49	694,894		103,434	911,494	—	178,785	103,434	1,090,279	1,193,713	(264,564	)	1982	30 Years
Parkville (Par)	Englewood, OH	48	—		127,863	1,126,638	—	169,572	127,863	1,296,209	1,424,072	(281,425	)	1982	30 Years
Parkway North (REIT)	Ft. Meyers, FL	56	1,051,070		145,350	1,308,115	—	280,069	145,350	1,588,184	1,733,534	(253,581	)	1984	30 Years
Parkwood (CT)	East Haven, CT	102	—		531,365	3,552,064	—	219,030	531,365	3,771,094	4,302,459	(618,483	)	1975	30 Years
Parkwood Village I (REIT)	Douglasville, GA	69	1,127,305		172,878	1,555,984	—	34,541	172,878	1,590,525	1,763,402	(61,392	)	1985	30 Years
Parkwood Village II (REIT)	Douglasville, GA	66	1,256,771		207,576	1,868,265	—	49,192	207,576	1,917,457	2,125,033	(67,336	)	1987	30 Years
Phillips Park	Wellesley, MA	49	3,865,979		816,922	5,460,955	—	276,381	816,922	5,737,336	6,554,258	(848,626	)	1988	30 Years
Pier, The	Jersey City, NJ	297	—		4,000,159	94,650,860	—	105,867	4,000,159	94,756,727	98,756,886	(2,712,478	)	2003	30 Years
Pine Barrens	Jacksonville, FL	104	—		268,303	2,364,041	—	631,257	268,303	2,995,298	3,263,601	(654,746	)	1986	30 Years
Pine Harbour	Orlando, FL	366	—		1,664,300	14,970,915	—	2,267,381	1,664,300	17,238,296	18,902,596	(6,957,680	)	1991	30 Years
Pine Knoll	Jonesboro, GA	46	1,121,098		138,052	1,216,391	—	173,686	138,052	1,390,077	1,528,129	(290,447	)	1985	30 Years
Pine Meadows I (FL)	Ft. Meyers, FL	60	—		152,019	1,339,596	—	434,712	152,019	1,774,309	1,926,328	(458,287	)	1985	30 Years
Pine Terrace I	Callaway, FL	148	1,990,498		288,992	2,546,426	—	838,258	288,992	3,384,685	3,673,677	(829,488	)	1983	30 Years
Pine Tree Club	Wildwood, MO	150	—		1,125,000	7,017,082	—	809,505	1,125,000	7,826,587	8,951,587	(1,745,720	)	1986	30 Years
Pinegrove I (REIT)	Roseville, MI	50	1,048,446		145,660	1,311,019	—	43,992	145,660	1,355,011	1,500,671	(61,727	)	1983	30 Years
Pinegrove II (REIT)	Roseville, MI	33	—		99,074	891,743	—	14,584	99,074	906,327	1,005,401	(39,554	)	1984	30 Years
Pinellas Pines	Pinellas Park, FL	68	—		174,999	1,541,934	—	271,202	174,999	1,813,136	1,988,135	(399,301	)	1983	30 Years
Pines of Cloverlane	Ypsilanti, MI	582	—		1,907,800	16,767,519	—	6,152,504	1,907,800	22,920,024	24,827,824	(9,709,860	)	1975-79	30 Years
Plum Tree	Hales Corners, WI	332	(N	)	1,996,700	20,247,195	—	1,187,650	1,996,700	21,434,845	23,431,545	(5,530,474	)	1989	30 Years
Plumwood I	Columbus, OH	109	—		289,814	2,553,597	—	430,973	289,814	2,984,571	3,274,385	(660,531	)	1978	30 Years
Plumwood II	Columbus, OH	34	—		107,583	947,924	—	117,040	107,583	1,064,964	1,172,547	(217,716	)	1983	30 Years
Point (NC)	Charlotte, NC	340	(S	)	1,700,000	25,417,267	—	634,862	1,700,000	26,052,129	27,752,129	(5,809,724	)	1996	30 Years
Pointe at South Mountain	Phoenix, AZ	364	—		2,228,800	20,059,311	—	1,548,364	2,228,800	21,607,675	23,836,475	(6,336,652	)	1988	30 Years
Polos East	Orlando, FL	308	—		1,386,000	19,058,620	—	1,025,807	1,386,000	20,084,427	21,470,427	(4,669,386	)	1991	30 Years
Port Royale	Ft. Lauderdale, FL	252	—		1,754,200	15,789,873	—	2,379,538	1,754,200	18,169,411	19,923,611	(6,674,068	)	1988	30 Years
Port Royale II	Ft. Lauderdale, FL	161	—		1,022,200	9,203,166	—	1,502,671	1,022,200	10,705,837	11,728,037	(3,559,887	)	1988	30 Years
Port Royale III	Ft. Lauderdale, FL	324	—		7,454,900	14,725,802	—	2,496,741	7,454,900	17,222,543	24,677,443	(4,972,774	)	1988	30 Years
Port Royale IV	Ft. Lauderdale, FL	—	—		—	24,645	—	—	—	24,645	24,645	—		(F)	30 Years
Portland Center	Portland, OR (G)	525	—		6,032,900	43,554,399	—	4,807,084	6,032,900	48,361,482	54,394,382	(11,826,982	)	1965	30 Years
Portofino	Chino Hills, CA	176	—		3,572,400	14,660,994	—	958,006	3,572,400	15,618,999	19,191,399	(3,942,024	)	1989	30 Years
Portofino (Val)	Valencia, CA	216	14,127,942		8,640,000	21,487,126	—	509,337	8,640,000	21,996,463	30,636,463	(3,194,003	)	1989	30 Years
Portside Towers	Jersey City, NJ (G)	527	53,654,654		22,455,700	96,842,913	—	4,579,315	22,455,700	101,422,228	123,877,928	(23,158,728	)	1992/1997	30 Years
Prairie Creek I	Richardson, TX	464	(Q	)	4,067,292	38,986,022	—	1,065,640	4,067,292	40,051,662	44,118,954	(8,305,833	)	1998/99	30 Years
Preakness	Antioch, TN	260	—		1,561,900	7,668,521	—	1,878,288	1,561,900	9,546,808	11,108,708	(3,074,683	)	1986	30 Years
Preserve at Deer Creek	Deerfield Beach, FL	540	—		13,500,000	60,011,208	—	214,932	13,500,000	60,226,140	73,726,140	(2,388,140	)	1997	30 Years

S-8

EQUITY RESIDENTIAL

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2004

							Cost Capitalized
							Subsequent to		Gross Amount Carried						Life Used to
					Initial Cost to		Acquisition		at Close of						Compute
Description					Company		(Improvements, net) (E)		Period 12/31/04						Depreciation in
Apartment						Building &		Building &		Building &		Accumulated		Date of	Latest Income
Name	Location	Units (J)	Encumbrances		Land	Fixtures	Land	Fixtures	Land	Fixtures (A)	Total (B)	Depreciation		Construction	Statement (C)
Preston at Willowbend	Plano, TX	229	—		872,500	7,878,915	—	3,842,155	872,500	11,721,070	12,593,570	(4,761,628	)	1985	30 Years
Preston Bend	Dallas, TX	255	(M	)	1,085,200	9,532,056	—	890,964	1,085,200	10,423,020	11,508,220	(3,168,810	)	1986	30 Years
Princeton Court	Evansville, IN	62	832,324		116,696	1,028,219	—	259,207	116,696	1,287,426	1,404,122	(302,131	)	1985	30 Years
Promenade (FL)	St. Petersburg, FL	334	—		2,124,193	25,804,037	—	2,598,382	2,124,193	28,402,419	30,526,612	(6,374,139	)	1994	30 Years
Promenade at Aventura	Aventura, FL	296	—		13,320,000	30,353,748	—	759,120	13,320,000	31,112,868	44,432,868	(4,416,132	)	1995	30 Years
Promenade at Peachtree	Chamblee, GA	406	—		10,150,000	31,219,739	—	118,870	10,150,000	31,338,610	41,488,610	(735,368	)	2001	30 Years
Promenade at Town Center I	Valencia, CA	294	—		14,700,000	35,390,279	—	305,092	14,700,000	35,695,370	50,395,370	(1,528,228	)	2001	30 Years
Promenade at Town Center II	Valencia, CA	270	36,480,700		13,500,000	34,405,636	—	218,260	13,500,000	34,623,896	48,123,896	(1,337,682	)	2001	30 Years
Promenade at Wyndham Lakes	Coral Springs, FL	332	—		6,640,000	26,743,760	—	791,411	6,640,000	27,535,171	34,175,171	(4,479,900	)	1998	30 Years
Promenade Terrace	Corona, CA	330	13,857,293		2,282,800	20,546,289	—	2,410,823	2,282,800	22,957,113	25,239,913	(6,985,404	)	1990	30 Years
Promontory Pointe I & II	Phoenix, AZ	424	—		2,355,509	30,421,840	—	1,856,078	2,355,509	32,277,917	34,633,426	(8,396,729	)	1984/1996	30 Years
Prospect Towers	Hackensack, NJ	157	—		3,926,600	27,966,416	—	2,394,922	3,926,600	30,361,339	34,287,939	(7,558,563	)	1995	30 Years
Prospect Towers II	Hackensack, NJ	203	—		4,500,000	33,104,733	—	325,131	4,500,000	33,429,863	37,929,863	(3,041,709	)	2002	30 Years
Providence	Bothell, WA	200	—		3,573,621	19,059,505	—	72,051	3,573,621	19,131,557	22,705,178	(771,677	)	2000	30 Years
Providence at Kirby	Houston, TX	263	17,945,369		3,945,000	20,587,782	—	1,271,074	3,945,000	21,858,856	25,803,856	(1,916,148	)	1999	30 Years
Quail Call	Albany, GA	55	658,053		104,723	922,728	—	247,805	104,723	1,170,532	1,275,256	(276,965	)	1984	30 Years
Ramblewood I (Aug) (REIT)	Augusta, GA	84	1,338,474		172,475	1,552,271	—	47,908	172,475	1,600,179	1,772,654	(25,205	)	1985	30 Years
Ramblewood I (Val)	Valdosta, GA	52	—		132,084	1,163,801	—	230,610	132,084	1,394,412	1,526,495	(292,411	)	1983	30 Years
Ramblewood II (Aug)	Augusta, GA	102	—		169,269	1,490,783	—	358,423	169,269	1,849,206	2,018,475	(467,880	)	1986	30 Years
Ramblewood II (Val)	Valdosta, GA	28	—		61,672	543,399	—	29,870	61,672	573,269	634,941	(126,369	)	1983	30 Years
Ranch at Fossil Creek	Haltom City, TX	274	—		1,715,435	16,829,282	—	128,284	1,715,435	16,957,566	18,673,001	(841,197	)	2003	30 Years
Ranchside	New Port Richey, FL	76	—		144,692	1,274,898	—	330,093	144,692	1,604,991	1,749,683	(353,128	)	1985	30 Years
Ranchstone	Houston, TX	220	(S	)	770,000	15,371,431	—	503,303	770,000	15,874,734	16,644,734	(3,590,712	)	1996	30 Years
Ravens Crest	Plainsboro, NJ	704	(R	)	4,670,850	42,080,642	—	4,858,741	4,670,850	46,939,384	51,610,234	(18,200,484	)	1984	30 Years
Ravinia	Greenfield, WI	206	(N	)	1,240,100	12,055,713	—	731,216	1,240,100	12,786,929	14,027,029	(3,315,764	)	1991	30 Years
Red Deer I	Fairborn, OH	68	—		204,317	1,800,254	—	293,810	204,317	2,094,064	2,298,380	(437,221	)	1986	30 Years
Red Deer II	Fairborn, OH	63	—		193,852	1,708,044	—	170,208	193,852	1,878,252	2,072,104	(395,366	)	1987	30 Years
Redan Village I	Decatur, GA	78	—		274,294	2,416,963	—	341,091	274,294	2,758,054	3,032,349	(591,108	)	1984	30 Years
Redan Village II	Decatur, GA	76	—		240,605	2,119,855	—	145,866	240,605	2,265,721	2,506,327	(462,051	)	1986	30 Years
Redlands Lawn and Tennis	Redlands, CA	496	—		4,822,320	26,359,328	—	2,220,115	4,822,320	28,579,443	33,401,763	(7,573,689	)	1986	30 Years
Redwood Hollow (REIT)	Smyrna, TN	72	1,187,874		129,586	1,166,522	—	67,696	129,586	1,234,217	1,363,803	(70,637	)	1986	30 Years
Regency	Charlotte, NC	178	—		890,000	11,783,920	—	891,737	890,000	12,675,656	13,565,656	(2,951,836	)	1986	30 Years
Regency Palms	Huntington Beach, CA	310	—		1,857,400	16,713,254	—	2,710,700	1,857,400	19,423,953	21,281,353	(6,385,834	)	1969	30 Years
Remington Place	Phoenix, AZ	412	—		1,492,750	13,377,478	—	2,852,279	1,492,750	16,229,757	17,722,507	(5,679,494	)	1983	30 Years
Reserve at Ashley Lake	Boynton Beach, FL	440	24,150,000		3,520,400	23,332,494	—	1,738,849	3,520,400	25,071,342	28,591,742	(6,664,216	)	1990	30 Years
Reserve at Clarendon Centre, The	Arlington, VA (G)	252	—		10,500,000	52,957,381	—	198,456	10,500,000	53,155,837	63,655,837	(2,510,300	)	2003	30 Years
Reserve at Eisenhower, The	Alexandria, VA	226	—		6,500,000	34,585,060	—	76,969	6,500,000	34,662,028	41,162,028	(2,513,414	)	2002	30 Years
Reserve at Fairfax Corners	Fairfax, VA	652	(U	)	15,804,057	63,129,051	—	458,593	15,804,057	63,587,643	79,391,700	(5,344,613	)	2001	30 Years
Reserve at Marina Bay I	Quincy, MA	136	—		3,618,844	24,123,769	—	43,756	3,618,844	24,167,525	27,786,369	(758,339	)	2002	30 Years
Reserve at Marina Bay II	Quincy, MA	108	—		3,923,754	19,306,394	—	16,928	3,923,754	19,323,322	23,247,076	(569,298	)	2003	30 Years
Reserve at Potomac Yard	Alexandria, VA	588	—		11,918,917	69,485,747	—	374,099	11,918,917	69,859,847	81,778,763	(2,228,864	)	2002	30 Years
Reserve at Town Center	Loudon, VA	290	26,500,000		3,144,056	27,920,288	—	291,751	3,144,056	28,212,039	31,356,095	(954,272	)	20002	30 Years
Reserve at Town Center (WA)	Mill Creek, WA	389	—		10,369,400	41,172,081	—	97,349	10,369,400	41,269,431	51,638,831	(1,033,039	)	2001	30 Years
Reserve at Tyson’s Corner	Vienna, VA	—	—		—	513,946	—	—	—	513,946	513,946	—		(F)	30 Years
Reserve Square	Cleveland, OH (G)	748	—		2,618,852	23,582,869	—	16,653,297	2,618,852	40,236,166	42,855,018	(20,110,589	)	1973	30 Years
Residences at Little River	Haverhill, MA	174	—		6,905,138	19,177,447	—	57,791	6,905,138	19,235,238	26,140,376	(832,987	)	2003	30 Years
Retreat, The	Phoenix, AZ	480	(S	)	3,475,114	27,265,252	—	734,003	3,475,114	27,999,255	31,474,369	(5,655,559	)	1999	30 Years
Ribbon Mill	Manchester, CT	104	4,304,635		787,929	5,267,144	—	285,163	787,929	5,552,307	6,340,236	(890,987	)	1908	30 Years
Richmond Townhomes	Houston, TX	188	—		940,000	13,906,905	—	647,139	940,000	14,554,044	15,494,044	(3,346,047	)	1995	30 Years
Ridgewood (Lou)	Louisville, KY	61	—		163,686	1,442,301	—	162,005	163,686	1,604,306	1,767,992	(326,488	)	1984	30 Years
Ridgewood (MI)	Westland, MI	56	1,122,876		176,969	1,559,588	—	295,340	176,969	1,854,928	2,031,897	(405,703	)	1983	30 Years
Ridgewood I (Bed)	Bedford, IN	48	792,694		107,120	943,843	—	194,393	107,120	1,138,236	1,245,356	(260,896	)	1984	30 Years
Ridgewood I (Elk)	Elkhart, IN	70	—		159,371	1,404,234	—	350,215	159,371	1,754,449	1,913,820	(402,448	)	1984	30 Years
Ridgewood I (GA)	Decatur, GA	63	—		230,574	2,031,610	—	370,821	230,574	2,402,430	2,633,004	(491,193	)	1984	30 Years
Ridgewood I (Lex)	Lexington, KY	62	—		203,720	1,794,792	—	202,147	203,720	1,996,939	2,200,659	(419,770	)	1984	30 Years
Ridgewood I (OH)	Columbus, OH	60	1,135,727		174,066	1,534,135	—	289,937	174,066	1,824,072	1,998,138	(393,255	)	1984	30 Years
Ridgewood II (Bed)	Bedford, IN	50	821,030		99,559	877,221	—	130,858	99,559	1,008,079	1,107,637	(225,649	)	1986	30 Years
Ridgewood II (Elk)	Elkhart, IN	99	—		215,335	1,897,333	—	345,757	215,335	2,243,090	2,458,425	(532,808	)	1986	30 Years
Ridgewood II (GA)	Decatur, GA	52	909,920		164,999	1,453,626	—	205,788	164,999	1,659,415	1,824,414	(329,833	)	1986	30 Years
Ridgewood II (OH)	Columbus, OH	58	1,097,870		162,914	1,435,648	—	212,620	162,914	1,648,268	1,811,182	(356,197	)	1985	30 Years
Ridgewood Village	San Diego, CA	192	—		5,761,500	14,032,511	—	265,199	5,761,500	14,297,709	20,059,209	(3,544,259	)	1997	30 Years
Ridgewood Village II	San Diego, CA	216	—		6,048,000	19,971,537	—	50,210	6,048,000	20,021,747	26,069,747	(2,928,817	)	1997	30 Years
Rincon	Houston, TX	288	—		4,401,900	16,734,746	—	1,014,040	4,401,900	17,748,785	22,150,685	(5,025,547	)	1996	30 Years
River Glen I	Reynoldsburg, OH	60	—		171,272	1,508,892	—	144,495	171,272	1,653,387	1,824,659	(348,018	)	1987	30 Years
River Glen II	Reynoldsburg, OH	53	1,096,621		158,684	1,398,175	—	218,027	158,684	1,616,202	1,774,886	(335,670	)	1987	30 Years
River Hill	Grand Prairie, TX	334	—		2,004,000	19,272,944	—	920,781	2,004,000	20,193,725	22,197,725	(4,700,454	)	1996	30 Years
River Oaks (CA)	Oceanside, CA	280	10,131,654		5,600,000	20,673,714	—	960,332	5,600,000	21,634,045	27,234,045	(3,457,684	)	1984	30 Years
River Park	Fort Worth, TX	280	—		2,245,400	8,811,727	—	2,564,494	2,245,400	11,376,220	13,621,620	(3,251,237	)	1984	30 Years
River Pointe at Den Rock Park	Lawrence, MA	174	18,100,000		4,615,702	18,440,147	—	241,056	4,615,702	18,681,203	23,296,905	(1,427,397	)	2000	30 Years
River Stone Ranch	Austin, TX	448	—		5,376,000	27,004,185	—	750,087	5,376,000	27,754,272	33,130,272	(1,342,879	)	1998	30 Years
Rivers Bend (CT)	Windsor, CT	373	(P	)	3,325,517	22,573,826	—	756,625	3,325,517	23,330,451	26,655,967	(3,624,154	)	1973	30 Years
Rivers Edge	Waterbury, CT	156	—		781,900	6,561,167	—	516,929	781,900	7,078,097	7,859,997	(1,766,206	)	1974	30 Years
Rivers End I	Jacksonville, FL	66	1,291,998		171,745	1,507,065	—	464,814	171,745	1,971,879	2,143,624	(427,137	)	1986	30 Years
Rivers End II	Jacksonville, FL	69	—		190,688	1,680,171	—	380,596	190,688	2,060,767	2,251,455	(441,437	)	1986	30 Years
Riverside Park	Tulsa, OK	288	—		1,441,400	12,371,637	—	821,818	1,441,400	13,193,455	14,634,855	(3,607,550	)	1994	30 Years
Riverview Condominiums	Norwalk, CT	92	5,957,202		2,300,000	7,406,730	—	1,248,485	2,300,000	8,655,215	10,955,215	(1,563,974	)	1991	30 Years
Roanoke	Rochester Hills, MI	88	40,500		369,911	3,259,270	—	326,572	369,911	3,585,842	3,955,753	(714,204	)	1985	30 Years
Rock Creek	Carrboro, NC	188	—		895,700	8,062,543	—	1,472,355	895,700	9,534,898	10,430,598	(2,904,686	)	1986	30 Years
Rockingham Glen	West Roxbury, MA	143	2,203,001		1,124,217	7,515,160	—	367,160	1,124,217	7,882,320	9,006,537	(1,277,826	)	1974	30 Years

S-9

EQUITY RESIDENTIAL

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2004

							Cost Capitalized
							Subsequent to		Gross Amount Carried						Life Used to
					Initial Cost to		Acquisition		at Close of						Compute
Description					Company		(Improvements, net) (E)		Period 12/31/04						Depreciation in
Apartment						Building &		Building &		Building &		Accumulated		Date of	Latest Income
Name	Location	Units (J)	Encumbrances		Land	Fixtures	Land	Fixtures	Land	Fixtures (A)	Total (B)	Depreciation		Construction	Statement (C)
Rolling Green (Amherst)	Amherst, MA	204	3,575,203		1,340,702	8,962,317	—	1,958,458	1,340,702	10,920,775	12,261,477	(1,792,577	)	1970	30 Years
Rolling Green (Milford)	Milford, MA	304	7,144,117		2,012,350	13,452,150	—	1,480,825	2,012,350	14,932,975	16,945,325	(2,647,587	)	1970	30 Years
Rosecliff	Quincy, MA	156	—		5,460,000	15,721,570	—	129,854	5,460,000	15,851,424	21,311,424	(3,027,904	)	1990	30 Years
Rosecliff II	Quincy, MA	—	—		—	1,379	—	—	—	1,379	1,379	—		(F)	30 Years
Rosewood (KY)	Louisville, KY	77	—		253,453	2,233,196	—	277,373	253,453	2,510,569	2,764,022	(530,876	)	1984	30 Years
Rosewood (OH)	Columbus, OH	90	—		212,378	1,871,186	—	422,686	212,378	2,293,872	2,506,250	(502,796	)	1985	30 Years
Rosewood Commons I	Indianapolis, IN	96	1,712,753		228,644	2,014,652	—	301,649	228,644	2,316,301	2,544,946	(536,374	)	1986	30 Years
Rosewood Commons II	Indianapolis, IN	77	—		220,463	1,942,520	—	246,408	220,463	2,188,928	2,409,391	(485,177	)	1987	30 Years
Royal Oak	Eagan, MN	231	13,139,491		1,602,904	14,423,662	—	1,510,056	1,602,904	15,933,718	17,536,621	(4,227,396	)	1989	30 Years
Royal Oaks (FL)	Jacksonville, FL	284	—		1,988,000	13,645,117	—	955,505	1,988,000	14,600,623	16,588,623	(3,473,615	)	1991	30 Years
Royale	Cranston, RI	76	(P	)	512,785	3,427,866	—	372,436	512,785	3,800,301	4,313,087	(611,412	)	1976	30 Years
Sabal Palm at Boot Ranch	Palm Harbor, FL	432	—		3,888,000	28,923,692	—	1,542,166	3,888,000	30,465,858	34,353,858	(6,970,371	)	1996	30 Years
Sabal Palm at Carrollwood Place	Tampa, FL	432	—		3,888,000	26,911,542	—	1,004,942	3,888,000	27,916,484	31,804,484	(6,343,494	)	1995	30 Years
Sabal Palm at Lake Buena Vista	Orlando, FL	400	21,170,000		2,800,000	23,687,893	—	1,166,490	2,800,000	24,854,383	27,654,383	(5,845,594	)	1988	30 Years
Sabal Palm at Metrowest	Orlando, FL	411	—		4,110,000	38,394,865	—	1,726,456	4,110,000	40,121,321	44,231,321	(9,006,054	)	1998	30 Years
Sabal Palm at Metrowest II	Orlando, FL	456	—		4,560,000	33,907,283	—	830,402	4,560,000	34,737,685	39,297,685	(7,769,914	)	1997	30 Years
Sabal Pointe	Coral Springs, FL	275	—		1,951,600	17,570,508	—	2,148,804	1,951,600	19,719,312	21,670,912	(6,284,413	)	1995	30 Years
Saddle Club	Denver, CO	—	—		—	753,755	—	—	—	753,755	753,755	—		(F)	30 Years
Saddle Ridge	Ashburn, VA	216	—		1,364,800	12,283,616	—	1,258,862	1,364,800	13,542,478	14,907,278	(4,513,980	)	1989	30 Years
Sailboat Bay	Raleigh, NC	192	—		960,000	8,797,580	—	787,261	960,000	9,584,841	10,544,841	(2,291,347	)	1986	30 Years
Sandalwood	Toledo, OH	50	1,027,632		151,926	1,338,636	—	198,882	151,926	1,537,517	1,689,443	(308,075	)	1984	30 Years
Sandpiper II	Fort Pierce, FL	66	—		155,496	1,369,987	—	349,606	155,496	1,719,593	1,875,088	(438,958	)	1982	30 Years
Sanford Court	Sanford, FL	106	1,617,450		238,814	2,104,212	—	497,180	238,814	2,601,392	2,840,206	(605,767	)	1976	30 Years
Savannah at Park Place	Atlanta, GA	416	—		7,696,095	34,474,837	—	317,791	7,696,095	34,792,628	42,488,723	(1,147,300	)	2001	30 Years
Savannah Lakes	Boynton Beach, FL	466	—		7,000,000	30,422,607	—	944,529	7,000,000	31,367,135	38,367,135	(3,259,424	)	1991	30 Years
Savannah Midtown	Atlanta, GA	322	—		7,209,873	29,712,389	—	409,868	7,209,873	30,122,257	37,332,130	(1,020,854	)	2000	30 Years
Savoy I	Aurora, CO	444	—		6,109,460	38,765,670	—	117,013	6,109,460	38,882,684	44,992,144	(1,528,681	)	2001	30 Years
Scarborough Square	Rockville, MD	121	4,811,343		1,815,000	7,608,126	—	1,104,289	1,815,000	8,712,414	10,527,414	(2,135,143	)	1967	30 Years
Schooner Bay I	Foster City, CA	168	27,000,000		5,345,000	16,947,265	—	860,591	5,345,000	17,807,856	23,152,856	(2,334,379	)	1985	30 Years
Schooner Bay II	Foster City, CA	144	23,760,000		4,550,000	14,975,001	—	760,060	4,550,000	15,735,061	20,285,061	(2,035,972	)	1985	30 Years
Scottsdale Meadows	Scottsdale, AZ	168	—		1,512,000	11,407,699	—	785,946	1,512,000	12,193,645	13,705,645	(3,228,748	)	1984	30 Years
Security Manor	Westfield, MA	63	(P	)	355,456	2,376,152	—	53,336	355,456	2,429,488	2,784,944	(394,435	)	1971	30 Years
Sedona Springs	Austin, TX	396	(S	)	2,574,000	23,477,043	—	1,470,834	2,574,000	24,947,876	27,521,876	(5,879,393	)	1995	30 Years
Seeley Lake	Lakewood, WA	522	—		2,760,400	24,845,286	—	2,136,658	2,760,400	26,981,945	29,742,345	(7,571,569	)	1990	30 Years
Seventh & James	Seattle, WA	96	—		663,800	5,974,803	—	1,907,503	663,800	7,882,306	8,546,106	(2,454,420	)	1992	30 Years
Shadetree	West Palm Beach, FL	76	—		532,000	1,420,721	—	337,343	532,000	1,758,064	2,290,064	(322,125	)	1982	30 Years
Shadow Bay I	Jacksonville, FL	53	—		123,319	1,086,720	—	163,688	123,319	1,250,408	1,373,727	(293,618	)	1984	30 Years
Shadow Bay II	Jacksonville, FL	59	923,423		139,709	1,231,134	—	149,200	139,709	1,380,334	1,520,042	(321,749	)	1985	30 Years
Shadow Brook	Scottsdale, AZ	224	—		3,065,496	18,367,686	—	1,264,011	3,065,496	19,631,697	22,697,193	(5,153,874	)	1984	30 Years
Shadow Creek	Winter Springs, FL	280	—		6,000,000	21,719,768	—	61,442	6,000,000	21,781,211	27,781,211	(663,359	)	2000	30 Years
Shadow Lake	Doraville, GA	228	—		1,140,000	13,117,277	—	657,150	1,140,000	13,774,427	14,914,427	(3,180,214	)	1989	30 Years
Shadow Ridge	Tallahassee, FL	62	—		150,327	1,324,061	—	261,755	150,327	1,585,817	1,736,143	(356,374	)	1983	30 Years
Shadow Trace	Stone Mountain, GA	81	—		244,320	2,152,729	—	318,293	244,320	2,471,021	2,715,342	(530,446	)	1984	30 Years
Shadowood I	Sarasota, FL	69	600,000		157,661	1,389,061	—	372,053	157,661	1,761,114	1,918,775	(392,701	)	1982	30 Years
Shadowood II	Sarasota, FL	70	1,120,960		152,031	1,339,469	—	245,867	152,031	1,585,336	1,737,367	(342,470	)	1983	30 Years
Sheffield Court	Arlington, VA	597	—		3,349,350	31,337,168	—	2,970,541	3,349,350	34,307,709	37,657,059	(12,256,204	)	1986	30 Years
Sherbrook (IN)	Indianapolis, IN	76	1,536,953		171,920	1,514,707	—	193,269	171,920	1,707,976	1,879,897	(397,596	)	1986	30 Years
Sherbrook (OH)	Columbus, OH	60	1,041,084		163,493	1,440,036	—	330,562	163,493	1,770,598	1,934,092	(396,239	)	1985	30 Years
Sherbrook (PA)	Wexford, PA	74	—		279,665	2,464,404	—	306,980	279,665	2,771,384	3,051,049	(581,057	)	1986	30 Years
Siena Terrace	Lake Forest, CA	356	17,316,163		8,900,000	24,083,024	—	1,342,385	8,900,000	25,425,408	34,325,408	(5,457,037	)	1988	30 Years
Silver Forest	Ocala, FL	51	798,844		126,536	1,114,917	—	184,435	126,536	1,299,352	1,425,888	(262,537	)	1985	30 Years
Silver Springs (FL)	Jacksonville, FL	432	—		1,831,100	16,474,735	—	4,045,225	1,831,100	20,519,960	22,351,060	(6,300,272	)	1985	30 Years
Sky Ridge	Woodstock, GA	120	—		437,373	3,853,792	—	418,050	437,373	4,271,842	4,709,216	(874,855	)	1987	30 Years
Skycrest	Valencia, CA	264	17,582,696		10,560,000	25,574,457	—	695,678	10,560,000	26,270,136	36,830,136	(3,785,956	)	1999	30 Years
Skylark	Union City, CA	174	—		1,781,600	16,731,916	—	826,785	1,781,600	17,558,701	19,340,301	(4,086,181	)	1986	30 Years
Skyview	Rancho Santa Margarita, CA	260	—		3,380,000	21,953,151	—	360,073	3,380,000	22,313,224	25,693,224	(4,471,167	)	1999	30 Years
Slate Run (Hop)	Hopkinsville, KY	57	—		91,304	804,535	—	199,255	91,304	1,003,790	1,095,094	(243,726	)	1984	30 Years
Slate Run (Ind)	Indianapolis, IN	90	1,890,871		295,593	2,604,497	—	467,165	295,593	3,071,661	3,367,254	(672,611	)	1984	30 Years
Slate Run (Leb)	Lebanon, IN	61	1,147,354		154,061	1,357,445	—	294,121	154,061	1,651,566	1,805,627	(367,467	)	1984	30 Years
Slate Run (Mia)	Miamisburg, OH	48	778,713		136,065	1,198,879	—	198,060	136,065	1,396,940	1,533,004	(295,504	)	1985	30 Years
Slate Run I (Lou)	Louisville, KY	65	—		179,766	1,583,931	—	259,677	179,766	1,843,608	2,023,373	(411,898	)	1984	30 Years
Slate Run II (Lou)	Louisville, KY	63	1,087,384		167,723	1,477,722	—	168,959	167,723	1,646,682	1,814,404	(345,039	)	1985	30 Years
Sommerset Place	Raleigh, NC	144	—		360,000	7,800,206	—	809,925	360,000	8,610,131	8,970,131	(2,043,656	)	1983	30 Years
Sonata at Cherry Creek	Denver, CO	183	—		5,490,000	18,130,479	—	333,314	5,490,000	18,463,793	23,953,793	(2,725,093	)	1999	30 Years
Sonoran	Phoenix, AZ	429	—		2,361,922	31,841,724	—	1,301,191	2,361,922	33,142,915	35,504,837	(8,470,598	)	1995	30 Years
Sonterra at Foothill Ranch	Foothill Ranch, CA	300	(R	)	7,503,400	24,048,507	—	825,168	7,503,400	24,873,674	32,377,074	(5,929,481	)	1997	30 Years
South Pointe	St. Louis, MO	192	7,110,250		961,100	8,651,150	—	1,699,666	961,100	10,350,816	11,311,916	(3,160,472	)	1986	30 Years
South Shore	Stockton, CA	129	6,833,000		840,000	6,826,626	—	556,688	840,000	7,383,314	8,223,314	(1,141,569	)	1979	30 Years
South Winds	Fall River, MA	404	7,123,908		2,481,821	16,780,359	—	1,503,262	2,481,821	18,283,621	20,765,442	(3,165,723	)	1971	30 Years
Southwood	Palo Alto, CA	99	—		6,936,600	14,324,069	—	1,227,705	6,936,600	15,551,774	22,488,374	(3,896,233	)	1985	30 Years
Spicewood	Indianapolis, IN	50	984,566		128,355	1,131,044	—	131,274	128,355	1,262,318	1,390,673	(273,232	)	1986	30 Years
Spinnaker Cove	Hermitage, TN	278	(M	)	1,461,731	12,770,421	—	2,375,670	1,461,731	15,146,091	16,607,822	(4,414,455	)	1986	30 Years
Spring Gate	Springfield, FL	66	—		132,951	1,171,447	—	294,672	132,951	1,466,118	1,599,070	(394,965	)	1983	30 Years
Spring Hill Commons	Acton, MA	105	—		1,107,436	7,402,980	—	362,840	1,107,436	7,765,820	8,873,256	(1,221,705	)	1973	30 Years
Spring Lake Manor	Birmingham, AL (T)	240	3,696,601		199,992	4,512,048	—	1,175,058	199,992	5,687,106	5,887,098	(1,441,914	)	1972	30 Years
Springbrook	Anderson, SC	92	1,575,700		150,209	1,488,611	—	308,655	150,209	1,797,266	1,947,475	(404,389	)	1986	30 Years
Springs Colony	Altamonte Springs, FL	188	(M	)	630,411	5,852,157	—	1,378,442	630,411	7,230,598	7,861,009	(3,122,431	)	1986	30 Years
Springtree (REIT)	W. Palm Beach, FL	72	1,121,825		183,100	1,648,301	—	179,965	183,100	1,828,266	2,011,366	(288,426	)	1982	30 Years
Springwood (Col)	Columbus, OH	64	994,795		189,948	1,672,889	—	293,483	189,948	1,966,372	2,156,320	(430,356	)	1983	30 Years

S-10

EQUITY RESIDENTIAL

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2004

							Cost Capitalized
							Subsequent to		Gross Amount Carried						Life Used to
					Initial Cost to		Acquisition		at Close of						Compute
Description					Company		(Improvements, net) (E)		Period 12/31/04						Depreciation in
Apartment						Building &		Building &		Building &		Accumulated		Date of	Latest Income
Name	Location	Units (J)	Encumbrances		Land	Fixtures	Land	Fixtures	Land	Fixtures (A)	Total (B)	Depreciation		Construction	Statement (C)
St. Andrews at Winston Park	Coconut Creek, FL	284	—		5,680,000	19,812,090	—	695,344	5,680,000	20,507,434	26,187,434	(2,226,160	)	1997	30 Years
Steeplechase	Charlotte, NC	247	—		1,111,500	10,180,750	—	698,720	1,111,500	10,879,470	11,990,970	(2,720,640	)	1986	30 Years
Sterling Heights Condominium, LLC	Bellevue, WA	76	—		1,928,071	8,363,070	—	386,210	1,928,071	8,749,280	10,677,351	—		1988	30 Years
Sterling Point	Littleton, CO	143	—		935,500	8,419,200	—	835,218	935,500	9,254,418	10,189,918	(2,697,580	)	1979	30 Years
Stewart Way I	Hinesville, GA	132	2,019,543		290,773	2,562,373	—	511,434	290,773	3,073,807	3,364,580	(664,709	)	1986	30 Years
Stewart Way III	Hinesville, GA	59	—		100,500	1,530,464	—	64,663	100,500	1,595,127	1,695,627	(61,285	)	1986	30 Years
Stillwater	Savannah, GA	53	—		151,198	1,332,417	—	209,501	151,198	1,541,918	1,693,116	(311,929	)	1983	30 Years
Stone Crossing	Montgomery, AL (T)	152	1,866,400		103,186	2,716,316	—	462,829	103,186	3,179,145	3,282,331	(812,006	)	1973	30 Years
Stone Oak	Houston, TX	318	—		2,544,000	17,513,496	—	274,935	2,544,000	17,788,431	20,332,431	(1,692,755	)	1998	30 Years
Stonehenge (Day)	Dayton, OH	69	—		202,294	1,782,140	—	236,420	202,294	2,018,560	2,220,854	(444,399	)	1985	30 Years
Stonehenge (Ind)	Indianapolis, IN	60	1,117,603		146,810	1,293,559	—	309,073	146,810	1,602,632	1,749,442	(395,830	)	1984	30 Years
Stonehenge (KY)	Glasgow, KY	54	739,227		111,632	983,596	—	185,422	111,632	1,169,018	1,280,650	(255,824	)	1983	30 Years
Stonehenge (Mas)	Massillon, OH	60	—		145,386	1,281,012	—	280,585	145,386	1,561,596	1,706,983	(355,926	)	1984	30 Years
Stonehenge I (Ric)	Richmond, IN	59	1,046,236		156,343	1,377,552	—	246,405	156,343	1,623,957	1,780,300	(389,281	)	1984	30 Years
Stoneleigh at Deerfield	Alpharetta, GA	370	—		4,810,000	29,997,224	—	—	4,810,000	29,997,224	34,807,224	(137,684	)	2003	30 Years
Stoney Creek	Lakewood, WA	231	—		1,215,200	10,938,134	—	1,078,955	1,215,200	12,017,089	13,232,289	(3,432,437	)	1990	30 Years
Stratford Square	Winter Park, FL (T)	204	4,814,693		391,300	3,176,441	—	503,490	391,300	3,679,932	4,071,232	(926,019	)	1972	30 Years
Sturbridge Meadows	Sturbridge, MA	104	2,133,569		702,447	4,695,714	—	187,448	702,447	4,883,162	5,585,609	(790,018	)	1985	30 Years
Suffolk Grove I	Grove City, OH	71	—		214,107	1,886,415	—	419,166	214,107	2,305,581	2,519,687	(482,138	)	1985	30 Years
Suffolk Grove II	Grove City, OH	49	—		167,683	1,477,569	—	234,035	167,683	1,711,603	1,879,286	(364,925	)	1987	30 Years
Sugartree I	New Smyrna Beach, FL	61	890,931		155,018	1,453,696	—	337,939	155,018	1,791,635	1,946,653	(382,325	)	1984	30 Years
Sugartree II (REIT)	New Smyrna Beach, FL	60	1,444,026		178,416	1,599,476	—	23,597	178,416	1,623,072	1,801,488	(76,817	)	1985	30 Years
Summer Chase	Denver, CO	384	(Q	)	1,709,200	15,375,008	—	2,492,547	1,709,200	17,867,555	19,576,755	(6,233,072	)	1983	30 Years
Summer Creek	Plymouth, MN	72	—		579,600	3,815,800	—	497,446	579,600	4,313,246	4,892,846	(1,162,281	)	1985	30 Years
Summer Ridge	Riverside, CA	136	—		602,400	5,422,807	—	1,657,058	602,400	7,079,866	7,682,266	(2,036,002	)	1985	30 Years
Summerhill Glen	Maynard, MA	120	1,795,295.76		415,812	3,000,816	—	408,057	415,812	3,408,873	3,824,685	(610,591	)	1980	30 Years
Summerset Village	Chatsworth, CA	280	(Q	)	2,630,700	23,670,889	—	1,173,531	2,630,700	24,844,420	27,475,120	(7,312,315	)	1985	30 Years
Summerset Village II	Chatsworth, CA	—	—		260,646	31,577	—	—	260,646	31,577	292,223	—		(F)	30 Years
Summerwood	Hayward, CA	162	—		4,866,600	6,942,743	—	783,586	4,866,600	7,726,329	12,592,929	(2,014,676	)	1982	30 Years
Summit & Birch Hill	Farmington, CT	186	(P	)	1,757,438	11,748,112	—	866,789	1,757,438	12,614,902	14,372,340	(1,921,101	)	1967	30 Years
Summit at Lake Union	Seattle, WA	150	—		1,424,700	12,852,461	—	1,179,999	1,424,700	14,032,460	15,457,160	(3,995,450	)	1995 - 1997	30 Years
Summit Center (FL)	W. Palm Beach, FL	87	2,119,290		670,000	1,733,312	—	390,548	670,000	2,123,860	2,793,860	(445,064	)	1987	30 Years
Sunforest	Davie, FL	494	—		10,000,000	32,124,850	—	593,340	10,000,000	32,718,189	42,718,189	(1,667,412	)	1989	30 Years
Sunnyside	Tifton, GA	72	1,223,638		166,887	1,470,612	—	240,478	166,887	1,711,091	1,877,978	(389,425	)	1984	30 Years
Sunset Way I	Miami, FL	100	—		258,568	2,278,539	—	386,942	258,568	2,665,481	2,924,049	(592,006	)	1987	30 Years
Sunset Way II	Miami, FL	100	—		274,903	2,422,546	—	292,675	274,903	2,715,221	2,990,125	(582,451	)	1988	30 Years
Suntree	West Palm Beach, FL	67	—		469,000	1,479,589	—	93,509	469,000	1,573,097	2,042,097	(245,608	)	1982	30 Years
Surrey Downs	Bellevue, WA	122	—		3,057,100	7,848,618	—	677,314	3,057,100	8,525,933	11,583,033	(2,097,612	)	1986	30 Years
Sutton Place	Dallas, TX	456	—		1,306,335	12,227,725	—	4,461,706	1,306,335	16,689,431	17,995,766	(7,559,599	)	1985	30 Years
Sutton Place (FL)	Lakeland, FL	55	777,468		120,887	1,065,150	—	315,354	120,887	1,380,504	1,501,392	(323,419	)	1984	30 Years
Sycamore Creek	Scottsdale, AZ	350	—		3,152,000	19,083,727	—	1,501,078	3,152,000	20,584,805	23,736,805	(5,655,884	)	1984	30 Years
Tabor Ridge	Berea, OH	97	—		235,940	2,079,290	—	431,301	235,940	2,510,591	2,746,531	(571,404	)	1986	30 Years
Talleyrand	Tarrytown, NY (M)	300	35,000,000		12,000,000	49,838,160	—	545,143	12,000,000	50,383,303	62,383,303	(5,827,652	)	1997-98	30 Years
Tamarlane	Portland, ME	115	—		690,900	5,153,633	—	432,109	690,900	5,585,741	6,276,641	(1,615,692	)	1986	30 Years
Tanasbourne Terrace	Hillsboro, OR	373	(Q	)	1,876,700	16,891,205	—	2,548,661	1,876,700	19,439,865	21,316,565	(7,672,952	)	1986-89	30 Years
Tanglewood (RI)	West Warwick, RI	176	6,305,957		1,141,415	7,630,129	—	292,946	1,141,415	7,923,074	9,064,490	(1,264,960	)	1973	30 Years
Tanglewood (VA)	Manassas, VA	432	25,110,000		2,108,295	24,619,176	—	3,179,192	2,108,295	27,798,367	29,906,662	(8,705,290	)	1987	30 Years
Terrace Trace	Tampa, FL	87	1,503,913		193,916	1,708,615	—	307,346	193,916	2,015,961	2,209,877	(452,793	)	1985	30 Years
Thymewood II	Miami, FL	70	—		219,661	1,936,463	—	189,773	219,661	2,126,236	2,345,897	(434,930	)	1986	30 Years
Tierra Antigua	Albuquerque, NM	148	6,249,298		1,825,000	7,792,856	—	370,058	1,825,000	8,162,915	9,987,915	(1,254,029	)	1985	30 Years
Timber Hollow	Chapel Hill, NC	198	—		800,000	11,219,537	—	1,106,214	800,000	12,325,751	13,125,751	(2,898,612	)	1986	30 Years
Timbercreek	Toledo, OH	77	1,416,857		203,420	1,792,350	—	310,580	203,420	2,102,930	2,306,350	(446,629	)	1987	30 Years
Timberwalk	Jacksonville, FL	284	—		1,988,000	13,204,219	—	1,045,529	1,988,000	14,249,748	16,237,748	(3,450,151	)	1987	30 Years
Timberwood (GA)	Perry, GA	60	—		144,299	1,271,305	—	202,840	144,299	1,474,145	1,618,444	(298,729	)	1985	30 Years
Toscana	Irvine, CA	563	—		39,410,000	50,806,072	—	2,411,627	39,410,000	53,217,699	92,627,699	(8,060,818	)	1991/1993	30 Years
Town Center (TX)	Kingwood, TX	258	—		1,291,300	11,530,216	—	1,330,686	1,291,300	12,860,903	14,152,203	(3,633,662	)	1994	30 Years
Town Center II (TX)	Kingwood, TX	260	—		1,375,000	14,169,656	—	92,683	1,375,000	14,262,339	15,637,339	(2,661,766	)	1994	30 Years
Trails (CO), The	Aurora, CO	351	(Q	)	1,217,900	8,877,205	—	3,148,290	1,217,900	12,025,495	13,243,395	(5,539,307	)	1986	30 Years
Trails at Briar Forest	Houston, TX	476	12,481,969		2,380,000	24,911,561	—	1,546,286	2,380,000	26,457,847	28,837,847	(6,218,539	)	1990	30 Years
Trails at Dominion Park	Houston, TX	843	—		2,531,800	35,699,589	—	3,981,877	2,531,800	39,681,466	42,213,266	(11,864,870	)	1992	30 Years
Trailway Pond I	Burnsville, MN	75	4,909,210		479,284	4,312,144	—	643,234	479,284	4,955,378	5,434,662	(1,341,515	)	1988	30 Years
Trailway Pond II	Burnsville, MN	165	11,354,755		1,107,288	9,961,409	—	1,183,825	1,107,288	11,145,233	12,252,521	(2,881,743	)	1988	30 Years
Turf Club	Littleton, CO	324	(S	)	2,107,300	15,478,040	—	2,112,217	2,107,300	17,590,257	19,697,557	(4,847,167	)	1986	30 Years
Turkscap I	Brandon, FL	49	—		125,766	1,108,139	—	429,342	125,766	1,537,482	1,663,248	(395,058	)	1977	30 Years
Turkscap III	Brandon, FL	50	716,655		135,850	1,196,987	—	328,064	135,850	1,525,051	1,660,901	(329,895	)	1982	30 Years
Tuscany Villas, LLC	Los Angeles, CA	180	—		1,431,048	14,928,007	—	495,570	1,431,048	15,423,577	16,854,625	(3,857,158	)	1995	30 Years
Tyrone Gardens	Randolph, MA	165	—		4,953,000	5,799,572	—	915,287	4,953,000	6,714,859	11,667,859	(1,787,956	)	1961/1965	30 Years
Union Station	Los Angeles, CA	—	6,663,301		8,500,000	13,280,094	—	—	8,500,000	13,280,094	21,780,094	—		(F)	30 Years
University Square I	Tampa, FL	81	—		197,457	1,739,807	—	303,136	197,457	2,042,944	2,240,400	(442,158	)	1979	30 Years
Valencia Plantation	Orlando, FL	194	—		873,000	12,819,377	—	507,665	873,000	13,327,043	14,200,043	(2,979,093	)	1990	30 Years
Valley Creek I	Woodbury, MN	225	12,815,000		1,626,715	14,634,831	—	2,043,340	1,626,715	16,678,171	18,304,887	(4,466,314	)	1989	30 Years
Valley Creek II	Woodbury, MN	177	10,100,000		1,232,659	11,097,830	—	1,177,876	1,232,659	12,275,706	13,508,366	(3,166,646	)	1990	30 Years
Valleybrook	Newnan, GA	71	1,379,854		254,490	2,242,463	—	309,335	254,490	2,551,798	2,806,288	(496,689	)	1986	30 Years
Valleyfield (KY)	Lexington, KY	83	1,711,251		252,329	2,223,757	—	346,771	252,329	2,570,528	2,822,856	(562,103	)	1985	30 Years
Valleyfield (PA)	Bridgeville, PA	77	—		274,317	2,417,029	—	355,949	274,317	2,772,978	3,047,295	(588,533	)	1985	30 Years
Valleyfield I	Decatur, GA	66	1,479,328		252,413	2,224,134	—	256,536	252,413	2,480,670	2,733,083	(529,218	)	1984	30 Years
Valleyfield II	Decatur, GA	66	—		258,320	2,276,084	—	163,332	258,320	2,439,416	2,697,737	(492,502	)	1985	30 Years
Van Deene Manor	West Springfield, MA	111	(P	)	744,491	4,976,771	—	299,545	744,491	5,276,315	6,020,806	(823,599	)	1970	30 Years
Venetian Condominium Phase II, LLC	Phoenix, AZ	160	—		1,047,212	9,436,170	—	1,261,715	1,047,212	10,697,885	11,745,097	(2,992,991	)	1983	30 Years

S-11

EQUITY RESIDENTIAL

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2004

							Cost Capitalized
							Subsequent to		Gross Amount Carried						Life Used to
					Initial Cost to		Acquisition		at Close of						Compute
Description					Company		(Improvements, net) (E)		Period 12/31/04						Depreciation in
Apartment						Building &		Building &		Building &		Accumulated		Date of	Latest Income
Name	Location	Units (J)	Encumbrances		Land	Fixtures	Land	Fixtures	Land	Fixtures (A)	Total (B)	Depreciation		Construction	Statement (C)
Venetian Condominium, LLC	Phoenix, AZ	11	—		71,939	648,237	—	304,817	71,939	953,055	1,024,994	(183,429	)	1983	30 Years
Verona Condominium, LLC	Scottsdale, AZ	108	—		1,301,497	7,522,719	—	1,513,642	1,301,497	9,036,361	10,337,858	(1,897,725	)	1994	30 Years
Versailles	Woodland Hills, CA	253	—		12,650,000	33,656,521	—	860,376	12,650,000	34,516,897	47,166,897	(1,560,730	)	1991	30 Years
Via Ventura	Scottsdale, AZ	328	—		1,486,600	13,382,006	—	6,510,868	1,486,600	19,892,874	21,379,474	(9,453,807	)	1980	30 Years
Villa Encanto	Phoenix, AZ	383	(S	)	2,884,447	22,197,363	—	2,090,906	2,884,447	24,288,269	27,172,716	(6,810,494	)	1983	30 Years
Villa Solana	Laguna Hills, CA	272	—		1,665,100	14,985,678	—	3,256,161	1,665,100	18,241,838	19,906,938	(7,289,293	)	1984	30 Years
Village at Bear Creek	Lakewood, CO	472	(R	)	4,519,700	40,676,390	—	1,481,137	4,519,700	42,157,527	46,677,227	(11,347,171	)	1987	30 Years
Village at Lakewood	Phoenix, AZ	240	(O	)	3,166,411	13,859,090	—	1,215,500	3,166,411	15,074,590	18,241,001	(4,135,239	)	1988	30 Years
Village Oaks	Austin, TX	280	—		1,186,000	10,663,736	—	1,372,381	1,186,000	12,036,117	13,222,117	(3,907,815	)	1984	30 Years
Village of Newport	Kent, WA	100	—		416,300	3,756,582	—	512,035	416,300	4,268,618	4,684,918	(1,723,977	)	1987	30 Years
Villas at Josey Ranch	Carrollton, TX	198	6,312,554		1,587,700	7,254,727	—	1,450,139	1,587,700	8,704,866	10,292,566	(2,218,515	)	1986	30 Years
Vintage	Ontario, CA	—	—		7,059,230	3,274,995	—	—	7,059,230	3,274,995	10,334,225	—		(F)	30 Years
Vista Del Lago	Mission Viejo, CA	608	—		4,525,800	40,736,293	—	5,942,086	4,525,800	46,678,379	51,204,179	(17,950,833	)	1986-88	30 Years
Vista Del Lago (TX)	Dallas, TX	296	—		3,552,000	20,066,912	—	564,041	3,552,000	20,630,953	24,182,953	(2,801,110	)	1992	30 Years
Vista Grove	Mesa, AZ	224	—		1,341,796	12,157,045	—	623,388	1,341,796	12,780,434	14,122,230	(3,155,650	)	1997 - 1998	30 Years
Warwick Station	Westminster, CO	332	8,355,000		2,282,000	21,113,974	—	1,051,234	2,282,000	22,165,209	24,447,209	(5,962,103	)	1986	30 Years
Water Terrace	Marina Del Rey, CA	450	—		63,207,814	164,804,953	—	175,898	63,207,814	164,980,852	228,188,666	(5,235,538	)	2003	30 Years
Waterbury (GA)	Athens, GA	53	—		147,450	1,299,195	—	78,711	147,450	1,377,906	1,525,356	(282,354	)	1985	30 Years
Waterbury (IN)	Greenwood, IN	44	768,352		105,245	927,324	—	123,476	105,245	1,050,801	1,156,046	(233,827	)	1984	30 Years
Waterbury (MI)	Westland, MI	101	—		331,739	2,922,589	—	434,288	331,739	3,356,876	3,688,615	(710,942	)	1985	30 Years
Waterbury (OH)	Cincinnati, OH	70	—		193,167	1,701,834	—	311,022	193,167	2,012,856	2,206,023	(464,444	)	1985	30 Years
Waterfield Square I	Stockton, CA	170	6,923,000		950,000	6,627,805	—	1,129,880	950,000	7,757,684	8,707,684	(1,215,015	)	1984	30 Years
Waterfield Square II	Stockton, CA	158	6,595,000		845,000	6,147,280	—	873,520	845,000	7,020,801	7,865,801	(1,108,953	)	1984	30 Years
Waterford (Jax)	Jacksonville, FL	432	—		3,024,000	23,662,293	—	1,594,230	3,024,000	25,256,523	28,280,523	(6,122,910	)	1988	30 Years
Waterford (Jax) II	Jacksonville, FL	—	—		566,923	62,373	—	—	566,923	62,373	629,296	—		(F)	30 Years
Waterford at Deerwood	Jacksonville, FL	248	10,290,623		1,696,000	10,659,702	—	1,707,551	1,696,000	12,367,253	14,063,253	(3,066,038	)	1985	30 Years
Waterford at Orange Park	Orange Park, FL	280	9,540,000		1,960,000	12,098,784	—	1,844,952	1,960,000	13,943,736	15,903,736	(3,820,997	)	1986	30 Years
Waterford at the Lakes	Kent, WA	344	(U	)	3,100,200	16,140,924	—	1,352,381	3,100,200	17,493,305	20,593,505	(5,239,745	)	1990	30 Years
Waterford Village (Palm Beach)	Delray Beach, FL	236	—		1,888,000	15,358,635	—	2,100,469	1,888,000	17,459,104	19,347,104	(4,653,998	)	1989	30 Years
Watermarke	Irvine, CA	490	84,279,474		19,283,234	98,197,941	—	1,949	19,283,234	98,199,890	117,483,124	—		2004	30 Years
Webster Green	Needham, MA	77	6,029,612		1,418,893	9,485,006	—	262,757	1,418,893	9,747,763	11,166,656	(1,464,694	)	1985	30 Years
Welleby Lake Club	Sunrise, FL	304	—		3,648,000	17,620,879	—	1,083,776	3,648,000	18,704,656	22,352,656	(4,373,892	)	1991	30 Years
Wellington Hill	Manchester, NH	390	(M	)	1,890,200	17,120,662	—	3,781,412	1,890,200	20,902,074	22,792,274	(8,398,986	)	1987	30 Years
Wellsford Oaks	Tulsa, OK	300	—		1,310,500	11,794,290	—	996,034	1,310,500	12,790,324	14,100,824	(3,709,767	)	1991	30 Years
Wentworth	Roseville, MI	75	—		217,502	1,916,232	—	329,122	217,502	2,245,353	2,462,856	(490,008	)	1985	30 Years
West Of Eastland	Columbus, OH	124	1,870,795		234,544	2,066,675	—	430,909	234,544	2,497,584	2,732,128	(583,432	)	1977	30 Years
Westbrooke Village	Manchester, MO	252	—		1,890,000	10,606,343	—	1,293,112	1,890,000	11,899,454	13,789,454	(2,640,147	)	1984	30 Years
Westbrooke Village II	Manchester, MO	—	—		420,000	—	—	—	420,000	—	420,000	—		(F)	30 Years
Westfield Village	Centerville, VA	228	—		7,000,000	23,245,834	—	94,805	7,000,000	23,340,639	30,340,639	(338,393	)	1988	30 Years
Westgate	Pasadena, CA	—	21,372,556		46,168,848	2,874,125	—	—	46,168,848	2,874,125	49,042,973	—		(F)	30 Years
Westridge	Tacoma, WA	714	—		3,501,900	31,506,082	—	2,916,311	3,501,900	34,422,394	37,924,294	(10,092,237	)	1987/1991	30 Years
Westside Villas I	Los Angeles, CA	21	—		1,785,000	3,233,254	—	261,994	1,785,000	3,495,248	5,280,248	(545,501	)	1999	30 Years
Westside Villas II	Los Angeles, CA	23	—		1,955,000	3,541,435	—	11,214	1,955,000	3,552,649	5,507,649	(531,845	)	1999	30 Years
Westside Villas III	Los Angeles, CA	36	—		3,060,000	5,538,871	—	28,120	3,060,000	5,566,991	8,626,991	(838,273	)	1999	30 Years
Westside Villas IV	Los Angeles, CA	36	—		3,060,000	5,539,390	—	23,784	3,060,000	5,563,175	8,623,175	(829,700	)	1999	30 Years
Westside Villas V	Los Angeles, CA	60	—		5,100,000	9,224,485	—	39,009	5,100,000	9,263,494	14,363,494	(1,383,856	)	1999	30 Years
Westside Villas VI	Los Angeles, CA	18	—		1,530,000	3,024,001	—	79,714	1,530,000	3,103,715	4,633,715	(449,993	)	1989	30 Years
Westside Villas VII	Los Angeles, CA	53	—		4,505,000	10,758,900	—	36,373	4,505,000	10,795,273	15,300,273	(984,501	)	2001	30 Years
Westway	Brunswick, GA	70	—		168,323	1,483,106	—	379,127	168,323	1,862,233	2,030,556	(404,086	)	1984	30 Years
Westwood Glen	Westwood, MA	156	1,230,385		1,616,505	10,806,004	—	277,864	1,616,505	11,083,868	12,700,372	(1,705,235	)	1972	30 Years
Westwood Pines	Tamarac, FL	208	—		1,528,600	13,739,616	—	1,137,305	1,528,600	14,876,921	16,405,521	(4,006,465	)	1991	30 Years
Westwynd Apts	West Hartford, CT	46	—		308,543	2,062,548	—	193,591	308,543	2,256,138	2,564,681	(375,647	)	1969	30 Years
Whisper Creek	Denver, CO	272	—		5,310,000	22,997,972	—	5,509	5,310,000	23,003,481	28,313,481	(178,754	)	2002	30 Years
Whispering Oaks	Walnut Creek, CA	316	—		2,170,800	19,539,586	—	2,485,240	2,170,800	22,024,826	24,195,626	(7,008,176	)	1974	30 Years
Whispering Pines	Fr. Pierce, FL	64	—		384,000	621,367	—	246,359	384,000	867,726	1,251,726	(209,879	)	1986	30 Years
Whispering Pines II	Fr. Pierce, FL	44	—		105,172	926,476	—	182,873	105,172	1,109,349	1,214,520	(246,751	)	1986	30 Years
Whisperwood	Cordele, GA	50	—		84,240	742,374	—	224,275	84,240	966,649	1,050,889	(234,883	)	1985	30 Years
White Bear Woods	White Bear Lake, MN	225	14,172,876		1,624,741	14,618,490	—	1,629,783	1,624,741	16,248,273	17,873,013	(4,214,473	)	1989	30 Years
Wilcrest Woods	Savannah, GA	68	1,238,956		187,306	1,650,373	—	247,499	187,306	1,897,872	2,085,178	(391,930	)	1986	30 Years
Wilkins Glen	Medfield, MA	102	1,602,924		538,483	3,629,943	—	372,779	538,483	4,002,722	4,541,205	(688,709	)	1975	30 Years
Willow Brook (CA)	Pleasant Hill, CA	228	29,000,000		5,055,000	19,797,344	—	590,007	5,055,000	20,387,351	25,442,351	(2,776,411	)	1985	30 Years
Willow Creek	Fresno, CA	116	5,112,000		275,000	5,270,767	—	494,009	275,000	5,764,776	6,039,776	(888,452	)	1984	30 Years
Willow Creek I (GA)	Griffin, GA	53	—		145,769	1,298,973	—	273,348	145,769	1,572,322	1,718,090	(302,602	)	1985	30 Years
Willow Lakes	Spartanburg, SC	95	1,922,871		200,990	1,770,937	—	258,215	200,990	2,029,152	2,230,142	(444,564	)	1986	30 Years
Willow Run (GA)	Stone Mountain, GA	73	1,611,355		197,965	1,744,287	—	319,574	197,965	2,063,861	2,261,826	(464,366	)	1983	30 Years
Willow Run (IN)	New Albany, IN	64	1,054,106		183,873	1,620,119	—	179,497	183,873	1,799,616	1,983,489	(392,364	)	1984	30 Years
Willow Run (KY)	Madisonville, KY	72	1,050,359		141,016	1,242,352	—	241,821	141,016	1,484,172	1,625,188	(324,146	)	1984	30 Years
Willow Trail	Norcross, GA	224	—		1,120,000	11,412,982	—	776,798	1,120,000	12,189,780	13,309,780	(2,880,398	)	1985	30 Years
Willowood East II	Indianapolis, IN	60	—		104,918	924,590	—	197,856	104,918	1,122,445	1,227,363	(285,281	)	1985	30 Years
Willowood I (Gro)	Grove City, OH	46	882,762		126,045	1,110,558	—	239,948	126,045	1,350,506	1,476,551	(291,455	)	1984	30 Years
Willowood I (IN)	Columbus, IN	51	1,072,450		163,896	1,444,104	—	156,205	163,896	1,600,309	1,764,205	(335,584	)	1983	30 Years
Willowood I (KY)	Frankfort, KY	57	944,597		138,822	1,223,176	—	249,300	138,822	1,472,476	1,611,299	(315,236	)	1984	30 Years
Willowood I (Tro) (REIT)	Trotwood, OH	60	805,606		84,566	755,859	—	22,958	84,566	778,817	863,383	(41,741	)	1985	30 Years
Willowood I (Woo)	Wooster, OH	51	—		117,254	1,033,137	—	193,690	117,254	1,226,827	1,344,081	(260,765	)	1984	30 Years
Willowood II (Gro)	Grove City, OH	26	514,563		70,924	624,814	—	122,629	70,924	747,444	818,367	(165,515	)	1985	30 Years
Willowood II (IN)	Columbus, IN	58	1,080,479		161,306	1,421,284	—	150,077	161,306	1,571,361	1,732,668	(335,740	)	1986	30 Years
Willowood II (KY)	Frankfort, KY	53	—		120,375	1,060,639	—	139,638	120,375	1,200,277	1,320,653	(252,309	)	1985	30 Years
Willowood II (Tro)	Trotwood, OH	65	—		142,623	1,256,667	—	184,930	142,623	1,441,597	1,584,221	(316,459	)	1987	30 Years
Willowood II (Woo)	Wooster, OH	53	809,548		103,199	909,398	—	218,760	103,199	1,128,158	1,231,357	(259,895	)	1986	30 Years

S-12

EQUITY RESIDENTIAL

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2004

										Cost Capitalized
										Subsequent to				Gross Amount Carried										Life Used to
						Initial Cost to				Acquisition				at Close of										Compute
Description						Company				(Improvements, net) (E)				Period 12/31/04										Depreciation in
Apartment								Building &				Building &				Building &				Accumulated			Date of	Latest Income
Name	Location	Units (J)	Encumbrances			Land		Fixtures		Land		Fixtures		Land		Fixtures (A)		Total (B)		Depreciation			Construction	Statement (C)
Willows I (OH), The	Columbus, OH	50	—			76,283		672,340		—		176,413		76,283		848,753		925,036		(194,487		)	1987	30 Years
Willows II (OH), The	Columbus, OH	41	—			96,679		851,845		—		121,476		96,679		973,321		1,070,000		(209,652		)	1981	30 Years
Willows III (OH), The	Columbus, OH	43	839,800			129,221		1,137,783		—		163,894		129,221		1,301,677		1,430,899		(274,708		)	1987	30 Years
Wimberly	Dallas, TX	372	—			2,232,000		27,685,923		—		999,023		2,232,000		28,684,946		30,916,946		(6,456,451		)	1996	30 Years
Wimbledon Oaks	Arlington, TX	248	6,946,816			1,491,700		8,843,716		—		1,113,301		1,491,700		9,957,017		11,448,717		(2,623,126		)	1985	30 Years
Winchester Park	Riverside, RI	416	—			2,822,618		18,868,626		—		2,045,354		2,822,618		20,913,980		23,736,599		(3,737,756		)	1972	30 Years
Winchester Wood	Riverside, RI	62	2,100,842			683,215		4,567,154		—		155,033		683,215		4,722,187		5,405,403		(718,119		)	1989	30 Years
Windemere	Mesa, AZ	224	—			940,450		8,659,280		—		1,612,387		940,450		10,271,667		11,212,117		(3,256,731		)	1986	30 Years
Windmont	Atlanta, GA	178	—			3,204,000		7,128,448		—		538,649		3,204,000		7,667,097		10,871,097		(1,497,777		)	1988	30 Years
Windridge (CA)	Laguna Niguel, CA	344	(I		)	2,662,900		23,985,497		—		2,441,510		2,662,900		26,427,007		29,089,907		(9,705,615		)	1989	30 Years
Windsor at Fair Lakes	Fairfax, VA	250	—			10,000,000		28,587,109		—		111,646		10,000,000		28,698,755		38,698,755		(409,217		)	1988	30 Years
Windwood I (FL)	Palm Bay, FL	64	—			113,913		1,003,498		—		243,657		113,913		1,247,155		1,361,068		(314,435		)	1988	30 Years
Windwood II (FL)	Palm Bay, FL	64	190,000			118,915		1,047,598		—		329,282		118,915		1,376,881		1,495,796		(355,743		)	1987	30 Years
Wingwood (Orl)	Orlando, FL	86	1,355,993			236,884		2,086,402		—		1,024,156		236,884		3,110,558		3,347,442		(721,426		)	1980	30 Years
Winter Woods I (FL)	Winter Garden, FL	57	—			144,921		1,276,965		—		431,417		144,921		1,708,382		1,853,304		(385,927		)	1985	30 Years
Winter Woods II (FL) (REIT)	Winter Garden, FL	44	785,888			95,404		858,637		—		122,045		95,404		980,682		1,076,086		(69,566		)	1986	30 Years
Winterwood	Charlotte, NC	384	—			1,722,000		15,501,142		—		3,165,741		1,722,000		18,666,882		20,388,882		(7,859,879		)	1986	30 Years
Winthrop Court (KY)	Frankfort, KY	77	1,367,193			184,709		1,627,191		—		287,071		184,709		1,914,261		2,098,971		(421,968		)	1985	30 Years
Winthrop Court II (OH)	Columbus, OH	38	722,000			102,381		896,576		—		180,774		102,381		1,077,350		1,179,731		(225,559		)	1986	30 Years
Wood Creek (CA)	Pleasant Hill, CA	256	—			9,729,900		23,009,768		—		1,339,346		9,729,900		24,349,115		34,079,015		(6,643,373		)	1987	30 Years
Woodbine (Cuy)	Cuyahoga Falls, OH	55	—			185,868		1,637,701		—		172,540		185,868		1,810,240		1,996,108		(360,274		)	1982	30 Years
Woodbridge	Cary, GA	128	4,345,133			737,400		6,636,870		—		687,123		737,400		7,323,993		8,061,393		(2,452,538		)	1993-95	30 Years
Woodbridge (CT)	Newington, CT	73	(P		)	498,377		3,331,548		—		178,190		498,377		3,509,738		4,008,114		(557,686		)	1968	30 Years
Woodbridge II	Cary, GA	216	—			1,244,600		11,243,364		—		813,985		1,244,600		12,057,349		13,301,949		(3,824,157		)	1993-95	30 Years
Woodcliff I	Lilburn, GA	71	—			276,659		2,437,667		—		312,468		276,659		2,750,135		3,026,794		(585,599		)	1984	30 Years
Woodcliff II	Lilburn, GA	72	1,567,439			266,449		2,347,769		—		181,406		266,449		2,529,176		2,795,625		(512,045		)	1986	30 Years
Woodcreek	Beaverton, OR	440	—			1,755,800		15,816,455		—		3,196,899		1,755,800		19,013,354		20,769,154		(7,936,119		)	1982-84	30 Years
Woodcrest I	Warner Robins, GA	66	—			115,739		1,028,353		—		210,895		115,739		1,239,248		1,354,987		(253,998		)	1984	30 Years
Woodlake (WA)	Kirkland, WA	288	(R		)	6,631,400		16,735,484		—		1,263,513		6,631,400		17,998,998		24,630,398		(4,480,114		)	1984	30 Years
Woodland Hills	Decatur, GA	228	—			1,224,600		11,010,681		—		1,917,051		1,224,600		12,927,732		14,152,332		(4,335,302		)	1985	30 Years
Woodland Meadows	Ann Arbor, MI	306	(S		)	2,006,000		18,049,552		—		1,681,341		2,006,000		19,730,893		21,736,893		(5,423,498		)	1987-1989	30 Years
Woodlands I (Col)	Columbus, OH	88	1,655,571			231,996		2,044,233		—		440,687		231,996		2,484,920		2,716,915		(541,088		)	1983	30 Years
Woodlands I (PA)	Zelienople, PA	50	969,754			163,192		1,437,897		—		232,903		163,192		1,670,799		1,833,991		(348,646		)	1983	30 Years
Woodlands I (Str)	Streetsboro, OH	60	—			197,378		1,739,112		—		260,478		197,378		1,999,590		2,196,967		(441,936		)	1984	30 Years
Woodlands II (Col)	Columbus, OH	70	1,435,552			192,633		1,697,310		—		333,778		192,633		2,031,088		2,223,721		(439,645		)	1984	30 Years
Woodlands II (PA)	Zelienople, PA	62	—			192,972		1,700,297		—		159,745		192,972		1,860,042		2,053,014		(376,857		)	1987	30 Years
Woodlands II (Str)	Streetsboro, OH	60	1,480,825			183,996		1,621,205		—		217,784		183,996		1,838,989		2,022,985		(404,901		)	1985	30 Years
Woodlands III (Col)	Columbus, OH	93	—			230,536		2,031,249		—		500,391		230,536		2,531,639		2,762,175		(554,892		)	1987	30 Years
Woodlands of Brookfield	Brookfield, WI	148	(N		)	1,484,600		13,961,081		—		1,031,015		1,484,600		14,992,095		16,476,695		(3,698,131		)	1990	30 Years
Woodlands of Minnetonka	Minnetonka, MN	248	—			2,394,500		13,543,076		—		1,722,736		2,394,500		15,265,812		17,660,312		(4,112,003		)	1988	30 Years
Woodleaf	Campbell, CA	178	(R		)	8,550,600		16,988,183		—		675,416		8,550,600		17,663,599		26,214,199		(4,138,418		)	1984	30 Years
Woodmoor	Austin, TX	208	—			653,800		5,875,968		—		2,177,019		653,800		8,052,987		8,706,787		(3,562,078		)	1981	30 Years
Woodridge (CO)	Aurora, CO	212	—			2,780,700		7,576,972		—		1,188,477		2,780,700		8,765,449		11,546,149		(2,364,676		)	1980-82	30 Years
Woodridge (MN)	Eagan, MN	200	7,276,603			1,602,300		10,449,579		—		1,153,497		1,602,300		11,603,076		13,205,376		(3,041,176		)	1986	30 Years
Woodridge II (CO)	Aurora, CO	116	—			—		4,148,517		—		619,130		—		4,767,647		4,767,647		(1,290,865		)	1980-82	30 Years
Woodridge III (CO)	Aurora, CO	256	—			—		9,130,764		—		1,365,767		—		10,496,531		10,496,531		(2,842,985		)	1980-82	30 Years
Woods of Elm Creek	San Antonio, TX	185	—			590,000		5,310,328		—		914,515		590,000		6,224,843		6,814,843		(1,986,445		)	1983	30 Years
Woods of North Bend	Raleigh, NC	235	(S		)	1,039,500		9,305,319		—		1,964,177		1,039,500		11,269,496		12,308,996		(4,362,921		)	1983	30 Years
Woodscape	Raleigh, NC	240	—			957,300		8,607,940		—		1,166,997		957,300		9,774,937		10,732,237		(3,139,609		)	1979	30 Years
Woodside	Lorton, VA	252	—			1,326,000		12,510,903		—		1,825,800		1,326,000		14,336,702		15,662,702		(5,133,619		)	1987	30 Years
Woodtrail	Newnan, GA	61	—			250,895		2,210,658		—		261,610		250,895		2,472,268		2,723,163		(497,786		)	1984	30 Years
Wyndridge 2	Memphis, TN	284	14,135,000			1,488,000		13,607,636		—		1,957,097		1,488,000		15,564,733		17,052,733		(4,700,357		)	1988	30 Years
Wyndridge 3	Memphis, TN	284	10,855,000			1,502,500		13,531,741		—		1,176,297		1,502,500		14,708,038		16,210,538		(4,300,010		)	1988	30 Years
Yarmouth Woods	Yarmouth, ME	138	—			692,800		6,096,155		—		843,517		692,800		6,939,672		7,632,472		(1,825,054		)	1971/1978	30 Years
Management Business	Chicago, IL	—	—			—		—		—		40,949,836		—		40,949,836		40,949,836		(21,825,823		)	(D)	30 Years
Operating Partnership	Chicago, IL (H)	—	106,081			—		43,447		—		—		—		43,447		43,447		—			(F)	30 Years
Total Investment in Real Estate		183,931	$	2,111,416,752		$	2,340,734,919	$	11,555,979,825	$	—	$	955,905,915	$	2,340,734,919	$	12,511,885,740	$	14,852,620,659	$	(2,599,826,521	)

S-13

EQUITY RESIDENTIAL

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2004

NOTES:

(A)The balance of furniture & fixtures included in the total investment in real estate amount was $683,112,290 as of December 31, 2004.

(B)The aggregate cost for Federal Income Tax purposes as of December 31, 2004 was approximately $9.3 billion.

(C)The life to compute depreciation for furniture & fixtures is 5 years.

(D)This asset consists of various acquisition dates and largely represents furniture, fixtures and equipment owned by the Management Business.

(E)Improvements are net of write-off of fully depreciated assets which are no longer in service.

(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)The mortgage debt is the balance for two properties that were sold, which balance was not collateralized by the respective properties.  The amounts were transferred to ERPOP.

(I)These four properties are pledged as additional collateral in connection with various tax-exempt bond financings.

(J)Total units exclude 16,218 unconsolidated units.

S-14

EQUITY RESIDENTIAL

Schedule III - Real Estate and Accumulated Depreciation

Encumbrances Reconciliation

December 31, 2004

Entity Encumbrances	Number of Properties Encumbered By	See Properties With Note:	Amount
EQR Arbors Financing LP	1	(K)	$	13,265,000
EQR Breton Hammocks Financing LP	1	(L)	15,310,708
EQR-Bond Partnership	12	(M)	181,994,000
EQR Flatlands LLC	5	(N)	50,000,000
EWR, LP	5	(O)	44,239,899
GPT-Windsor, LLC	16*	(P)	63,000,000
EQR-Codelle, LP	10	(Q)	118,422,038
EQR-Conner, LP	14	(R)	206,516,196
EQR-FANCAP 2000A LP	11	(S)	148,333,000
GC Southeast Partners (SEP)	5	(T)	700,000
EQR-Fankey 2004 Ltd. Pship	8	(U)	213,541,577
Entity Encumbrances			1,055,322,418
Individual Property Encumbrances			2,111,416,752
Total Encumbrances per Financial Statements			$	3,166,739,170

*Collateral also includes $3.0 million invested in U.S. Treasury Securities which is included in Deposits - - Restricted in the accompanying consolidated balance sheets at December 31, 2004.

S-15

EQUITY RESIDENTIAL

Schedule III - Real Estate and Accumulated Depreciation

(Amounts in thousands)

The changes in total real estate for the years ended December 31, 2004, 2003 and 2002 are as follows:

	2004			2003			2002
Balance, beginning of year	$	12,874,379		$	13,046,263		$	13,019,841
Acquisitions and development	2,563,612			800,143			528,302
Improvements	218,724			184,876			164,077
Write-off of fully depreciated assets which are no longer in service	—			(31,590		)	—
Dispositions and other	(804,094		)	(1,125,313		)	(665,957		)
Balance, end of year	$	14,852,621		$	12,874,379		$	13,046,263

The changes in accumulated depreciation for the years ended December 31, 2004, 2003, and 2002 are as follows:

	2004			2003			2002
Balance, beginning of year	$	2,296,013		$	2,112,017		$	1,719,131
Depreciation	496,422			470,908			471,295
Write-off of fully depreciated assets which are no longer in service	—			(31,590		)	—
Dispositions and other	(192,608		)	(255,322		)	(78,409		)
Balance, end of year	$	2,599,827		$	2,296,013		$	2,112,017

S-16

EXHIBIT INDEX

Exhibit	Document
3.1	Articles of Restatement of Declaration of Trust of Equity Residential dated December 9, 2004
10.16	First Amendment to Equity Residential 2002 Share Incentive Plan.
10.17	Second Amendment to Equity Residential 2002 Share Incentive Plan.
10.18	Form of 2005 Equity Residential Performance Based Unit Award Grant Agreement.
10.22	First Amendment to Amended and Restated Executive Compensation Agreement between the Company and Samuel Zell dated February 3, 2005.
12	Computation of Ratio of Earnings to Combined Fixed Charges.
21	List of Subsidiaries of Equity Residential.
23.1	Consent of Ernst & Young LLP.
24.1	Power of Attorney for John W. Alexander dated March 9, 2005.
24.2	Power of Attorney for Stephen O. Evans dated March 1, 2005.
24.3	Power of Attorney for Charles L. Atwood dated March 7, 2005.
24.4	Power of Attorney for Desiree G. Rogers dated March 7, 2005.
24.5	Power of Attorney for B. Joseph White dated March 4, 2005.
24.6	Power of Attorney for Sheli Z. Rosenberg dated March 8, 2005.
24.7	Power of Attorney for James D. Harper, Jr. dated March 4, 2005.
24.8	Power of Attorney for Boone A. Knox dated March 2, 2005.
24.9	Power of Attorney for Samuel Zell dated March 9, 2005.
24.10	Power of Attorney for Gerald A. Spector dated March 1, 2005.
31.1	Certification of Bruce W. Duncan, Chief Executive Officer.
31.2	Certification of Donna Brandin, Chief Financial Officer.
32.1	Certification Pursuant to 18 U.S.C. Section 1350, as adopted, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of Bruce W. Duncan, Chief Executive Officer of the Company.
32.2	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.

EX-3.1

Exhibit 3.1

EQUITY RESIDENTIAL

ARTICLES OF RESTATEMENT

THIS IS TO CERTIFY THAT:

FIRST:Equity Residential, a Maryland real estate investment trust (the “Trust”), desires to restate its Declaration of Trust (the “Declaration of Trust”) as currently in effect.

SECOND:The following are all the provisions of the Declaration of Trust currently in effect:

ARTICLE I

THE TRUST; CERTAIN DEFINITIONS

SECTION 1.1Name.  The name of the trust (hereinafter called the “Trust”) is:

Equity Residential

SECTION 1.2Resident Agent.  The name and address of the resident agent of the Trust in the State of Maryland are The Corporation Trust Incorporated, 300 E. Lombard Street, Baltimore, Maryland 21202.  The Trust may have such offices or places of business within or without the State of Maryland as the Trustees may from time to time determine.

SECTION 1.3Nature of Trust.  The Trust is a real estate investment trust within the meaning of Title 8 (as hereinafter defined).

SECTION 1.4Powers. The Trust shall have all of the powers granted to real estate investment trusts generally by Title 8 and shall have any other and further powers as are not inconsistent with Title 8 or any other applicable law.

SECTION 1.5Definitions.  As used in this Declaration of Trust, the following terms shall have the following meanings unless the context otherwise requires:

“Affiliate” or “Affiliated” means, as to any corporation, partnership, trust or other association (other than the Trust), any Person (i) that holds beneficially, directly or indirectly, 5 % or more of the outstanding stock or equity interests thereof or (ii) who is an officer, director, partner or trustee thereof or of any Person which controls, is controlled by, or is under common control with, such corporation, partnership, trust or other association or (iii) which controls, is controlled by, or is under common control with, such corporation, partnership, trust or other association.

“Board of Trustees” means the Board of Trustees of the Trust.

“Code” means the Internal Revenue Code of 1986, as amended.

“Declaration” or “Declaration of Trust” means this Second Amended and Restated Declaration of Trust, including any amendments or supplements hereto.

“Person” means an individual, corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code, joint stock company or other entity, or any government and agency or political subdivision thereof.

“REIT Provisions of the Code” means Section 856 through 860 of the Code and any successor or other provisions of the Code relating to real estate investment trusts (including provisions as to the attribution of ownership of beneficial interests therein) and the regulations promulgated thereunder.

“Securities” means Shares (as hereinafter defined), any stock, shares or other evidences of equity, beneficial or other interests, voting trust certificates, bonds, debentures, notes or other evidences of indebtedness, secured or unsecured, convertible, subordinated or otherwise, or in general any instruments commonly known as “securities” or any certificates of interest, shares or participations in, temporary or interim certificates for, receipts for, guarantees of, or warrants, options or rights to subscribe to, purchase or acquire, any of the foregoing.

“Securities of the Trust” means any Securities issued by the Trust.

“Shareholders” means holders of record of outstanding Shares.

“Shares” means transferable shares of beneficial interest of the Trust of any class or series.

“Title 8” means Title 8 of the Corporations and Associations Article of the Annotated Code of Maryland, as amended, or any successor statute.

“Trustee” means, individually, an individual, and “Trustees” means, collectively, the individuals, in each case as named in Section 2.2 of this Declaration so long as they continue in office and any and all other individuals who have been duly elected and qualify as trustees of the Trust hereunder.

“Trust Property” means any and all property, real, personal or otherwise, tangible or intangible, which is transferred or conveyed to the Trust or the Trustees (including all rents, income, profits and gains therefrom), which is owned or held by, or for the account of, the Trust or the Trustees.

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ARTICLE II

TRUSTEES

SECTION 2.1Number.  The number of Trustees initially shall be two, which number may thereafter be increased or decreased by the Trustees then in office from time to time; however, the total number of Trustees shall be not less than two and not more than 15. No reduction in the number of Trustees shall cause the removal of any Trustee from office prior to the expiration of his term.

SECTION 2.2Term.

At each annual meeting of Shareholders beginning at the annual meeting of Shareholders in 2003, all Trustees shall be elected to hold office for a term of one year.  Trustees may be re-elected any number of times.  Each Trustee shall hold office until the election and qualification of his or her successor.

SECTION 2.3Resignation, Removal or Death.  Any Trustee may resign by written notice to the remaining Trustees, effective upon execution and delivery to the Trust of such written notice or upon any future date specified in the notice.  A Trustee may be removed, only with Cause (as hereinafter defined), at a meeting of the Shareholders called for that purpose, by the affirmative vote of the holders of not less than two-thirds of the Shares then outstanding and entitled to vote in the election of Trustees.  As used herein, “Cause” shall mean (a) material theft, fraud or embezzlement or active and deliberate dishonesty by a Trustee; (b) habitual neglect of duty by a Trustee having a material and adverse significance to the Trust; or (c) the conviction of a Trustee of a felony or of any crime involving moral turpitude.  Upon the resignation or removal of any Trustee, or his otherwise ceasing to be a Trustee, he shall automatically cease to have any right, title or interest in and to the Trust Property and shall execute and deliver such documents as the remaining Trustees require for the conveyance of any Trust Property held in his name, and shall account to the remaining Trustees as they require for all property which he holds as Trustee.  Upon the incapacity or death of any Trustee, his legal representative shall perform those acts.

SECTION 2.4Legal Title.  Legal title to all Trust Property shall be vested in the Trust, but it may cause legal title to any Trust Property to be held by or in the name of any or all of the Trustees or any other Person as nominee, in which case any right, title or interest of the Trustees in and to the Trust Property shall automatically vest in successor and additional Trustees upon their qualification and acceptance of election or appointment as Trustees, and they shall thereupon have all the rights and obligations of Trustees, whether or not conveyancing documents have been executed and delivered pursuant to Section 2.3 or otherwise.  Written evidence of the qualification and acceptance of election or appointment of successor and additional Trustees may be filed with the records of the Trust and in such other offices, agencies or places as the Trust or Trustees may deem necessary or desirable.

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ARTICLE III

POWERS OF TRUSTEES

Subject to the express limitations herein or in the Bylaws, (1) the business and affairs of the Trust shall be managed under the direction of the Board of Trustees and (2) the Board of Trustees shall have full, exclusive and absolute power, control and authority over the Trust Property and over the business of the Trust.  The Board of Trustees may take any actions as in its sole judgment and discretion are necessary or desirable to conduct the business of the Trust.  This Declaration of Trust shall be construed with a presumption in favor of the grant of power and authority to the Board of Trustees.  Any construction of this Declaration or determination made in good faith by the Board of Trustees concerning the powers and authority of the Trust, the Shareholders, the Board of Trustees or the offices of the Trust hereunder shall be conclusive.  The powers of the Board of Trustees shall in no way be limited or restricted by reference to or inference from the terms of this or any other provision of this Declaration or construed or deemed by inference or otherwise in any manner to exclude or limit the powers conferred upon the Board of Trustees under the general laws of the State of Maryland as now or hereafter in force.  In the case of an ambiguity in the application of any provision of this Declaration of Trust, including any provision relating to share ownership and transfers, the Board of Trustees shall have the power to determine the application of that provision (subject, however, to the provisions of Section 7.2(a)(1)(A)), and such determination shall be final and conclusive for all purposes.

The Board of Trustees, without any action by the Shareholders, shall have and may exercise, on behalf of the Trust, without limitation, the power to terminate the status of the Trust as a real estate investment trust under the Code; to determine that compliance with any restriction or limitations on ownership and transfers of shares of the Trust’s beneficial interest set forth in Article VII of this Declaration of Trust is no longer required in order for the Trust to qualify as a REIT; to adopt, amend and repeal Bylaws; to elect officers in the manner prescribed in the Bylaws; to solicit proxies from holders of shares of beneficial interest of the Trust; and to do any other acts and deliver any other documents necessary or appropriate to the foregoing powers.

ARTICLE IV

INVESTMENT POLICY

The fundamental investment policy of the Trust is to make investments in such a manner as to comply with the REIT Provisions of the Code and with the requirements of Title 8 with respect to the composition of the Trust’s investments and the derivation of its income.  Subject to Section 6.7, the Trustees shall use their best efforts to carry out this fundamental investment policy and to conduct the affairs of the Trust in such a manner as to continue to qualify the Trust for the tax treatment provided in the REIT Provisions of the Code; provided, however, that no Trustee, officer, employee or agent of the Trust shall be liable for any act or omission resulting in the loss of tax benefits under the Code, except to the extent permitted in Section 11.2.  The Board of Trustees may change from time to time, by resolution or in the Bylaws of the Trust, such investment policies as it determines to be in the best interest of the Trust, including prohibitions or restrictions upon certain types of investments.

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ARTICLE V

SHARES

SECTION 5.1Authorized Shares.  The total number of Shares which the Trust has authority to issue is 1,100,000,000 shares, of which 1,000,000,000 are common shares, $0.01 par value per share (individually a “Common Share” or collectively “Common Shares”), and 100,000,000 are preferred shares, $0.01 par value per share (“Preferred Shares”) of which

(a)[Intentionally Omitted.]

(b)575,000 shares have been designated as 9-1/8% Series B Cumulative Redeemable Preferred Shares of Beneficial Interest ($0.01 Par Value Per Share) (Liquidation Preference $250.00 Per Share) with the terms set forth in Section 13.2 of this Declaration,

(c)460,000 shares have been designated as 9-1/8% Series C Cumulative Redeemable Preferred Shares of Beneficial Interest ($0.01 Par Value Per Share) (Liquidation Preference $250.00 Per Share) with the terms set forth in Section 13.3 of this Declaration,

(d)805,000 have been designated as 8.60% Series D Cumulative Redeemable Preferred Shares of Beneficial Interest (Liquidation Preference $250.00 Per Share) with the terms set forth in Section 13.4 of this Declaration,

(e)4,600,000 shares have been designated as Series E Cumulative Convertible Preferred Shares of Beneficial Interest with the terms set forth in Section 13.5 of this Declaration,

(f)[Intentionally Omitted.]

(g)164,951 shares have been designated as Series H Cumulative Convertible Preferred Shares of Beneficial Interest ($.01 Par Value Per Share) (Liquidation Preference $25.00 Per Share) with the terms set forth in Section 13.7 of this Declaration,

(h)1,000,000 shares have been designated as Series K Cumulative Redeemable Preferred Shares of Beneficial Interest ($.01 Par Value Per Share) (Liquidation Preference $50.00 Per Share) with the terms set forth in Section 13.8 of this Declaration,

(i)800,000 shares have been designated as 8.00% Series M Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $50.00 per share), with the terms set forth in Section 13.9 of this Declaration,

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(j)1,320,000 shares have been designated as 8.50% Series M-1 Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $50.00 per share), with the terms set forth in Section 13.10 of this Declaration,

(k)600,000 shares have been designated as 8.375% Series M-2 Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $50.00 per share), with the terms set forth in Section 13.11 of this Declaration,

(l)1,000,000 shares have been designated as 8.50% Series M-3 Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $50.00 per share), with the terms set forth in Section 13.12 of this Declaration,

(m)510,000 shares have been designated as 7.875% Series M-4 Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $50.00 per share), with the terms set forth in Section 13.13 of this Declaration,

(n)190,000 shares have been designated as 7.625% Series M-5 Convertible Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $50.00 per share) with the terms set forth in Section 13.14 of this Declaration,

(o)270,000 shares have been designated as 7.625% Series M-6 Convertible Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $50.00 per share), with the terms set forth in Section 13.15 of this Declaration,

(p)230,000 shares have been designated as 7.625% Series M-7 Convertible Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $50.00 per share), with the terms set forth in Section 13.16 of this Declaration,

(q)600,000 shares have been designated as 6.48% Series N Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $250.00 per share), with the terms set forth in Section 13.17 of this Declaration.

SECTION 5.2Common Shares.  Subject to the provisions of Article VII, each Common Share shall entitle the holder thereof to one vote.  Holders of Common Shares shall not be entitled to cumulative voting.

SECTION 5.3Preferred Shares.  The Board of Trustees may classify any unissued Preferred Shares and reclassify any previously classified but unissued Preferred Shares of any series from time to time, in one or more series of Shares.

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SECTION 5.4Classified or Reclassified Shares.  Prior to issuance of classified or reclassified Shares of any class or series, the Board of Trustees by resolution shall (a) designate that class or series to distinguish it from all other classes and series of Shares; (b) specify the number of Shares to be included in the class or series; (c) set, subject to the provisions of Article VII and subject to the express terms of any class or series of Shares outstanding at the time, the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications and terms and conditions of redemption for each class or series; and (d) cause the Trust to file articles supplementary with the State Department of Assessments and Taxation of Maryland (the “SDAT”).  Any of the terms of any class or series of Shares set pursuant to clause (c) of this Section 5.4 may be made dependent upon facts ascertainable outside the Declaration of Trust (including the occurrence of any event, determination or action by the Trust, or any other person or body) and may vary among holders thereof, provided that the manner in which such facts or variations shall operate upon the terms of such class or series of Shares is clearly and expressly set forth in the articles supplementary filed with the SDAT.

SECTION 5.5Authorization by Board of Share Issuance.  The Board of Trustees may authorize the issuance from time to time of Shares of any class or series, whether now or hereafter authorized, or securities or rights convertible into Shares of any class or series, whether now or thereafter authorized, for such consideration (whether in cash, property, past or future services, obligation for future payment or otherwise) as the Board of Trustees may deem advisable (or without consideration in the case of a Share split or Share dividend), subject to such restrictions or limitations, if any, as may be set forth in this Declaration of Trust or the Bylaws of the Trust.

SECTION 5.6Dividends and Distributions.  The Board of Trustees may from time to time authorize and declare such dividends or distributions, in cash or other assets of the Trust or in securities of the Trust or from any other source as the Board of Trustees in its discretion shall determine.  The Board of Trustees shall endeavor to authorize, declare and pay such dividends and distributions as shall be necessary for the Trust to qualify as a real estate investment trust under the Code; however, Shareholders shall have no right to any dividend or distribution unless and until authorized and declared by the Board.  The exercise of the powers and rights of the Board of Trustees pursuant to this Section 5.6 shall be subject to the provisions of any class or series of Shares at the time outstanding.  Notwithstanding any other provision in this Declaration of Trust, no determination shall be made by the Board of Trustees nor shall any transaction be entered into by the Trust which would cause any Shares or other beneficial interest in the Trust not to constitute “transferable shares” or “transferable certificates of beneficial interest” under Section 856(a)(2) of the Code or which would cause any distribution to constitute a preferential dividend as described in Section 562(c) of the Code.

SECTION 5.7General Nature of Shares.  All Shares shall be personal property entitling the Shareholders only to those rights provided in this Declaration of Trust.  The Shareholders shall have no interest in the property of the Trust and shall have no right to compel any partition, division, dividend or distribution of the Trust or of the property of the Trust.  The death of a Shareholder shall not terminate the Trust.  The Trust is entitled to treat as Shareholders only those persons in whose names Shares are registered as holders of Shares on the beneficial interest ledger of the Trust.

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SECTION 5.8Fractional Shares.  The Trust may, without the consent or approval of any Shareholder, issue fractional Shares, eliminate a fraction of a Share by rounding up or down to a full Share, arrange for the disposition of a fraction of a Share by the person entitled to it, or pay cash for the fair value of a fraction of a Share.

SECTION 5.9Declaration of Trust and Bylaws.  All persons who shall acquire Shares shall acquire the same subject to the provisions of this Declaration of Trust and the Bylaws of the Trust.

ARTICLE VI

PROVISIONS FOR DEFINING, LIMITING

AND REGULATING CERTAIN POWERS OF THE

TRUST AND OF THE SHAREHOLDERS AND TRUSTEES

SECTION 6.1Authorization by Board of Share Issuance.  The Board of Trustees may authorize the issuance from time to time of Shares of any class, whether now or hereafter authorized, or securities convertible into Shares of any class, whether now or hereafter authorized, for such consideration as the Board of Trustees may deem advisable, subject to such restrictions or limitations, if any, as may be set forth in this Declaration of Trust or in the Bylaws of the Trust or in the general laws of the State of Maryland.

SECTION 6.2Preemptive and Appraisal Rights.  Except as may be provided by the Board of Trustees in authorizing the issuance of Shares pursuant to Sections 5.4 and 5.5, no holder of Shares shall, as such holder, (a) have any preemptive right to purchase or subscribe for any additional Shares or any other security of the Trust which the Trust may issue or sell or (b), except as expressly required by Title 8, have any right to require the Trust to pay him the fair value of his Shares in an appraisal or similar proceeding.

SECTION 6.3Advisor Agreements.  Subject to such approval of the Shareholders and other conditions, if any, as may be required by any applicable statute, rule or regulation, the Board of Trustees may authorize the execution and performance by the Trust of one or more agreements with any person, corporation, association, company, trust, partnership (limited or general) or other organization whereby, subject to the supervision and control of the Board of Trustees, any such other person, corporation, association, company, trust, partnership (limited or general) or other organization (the “Advisor”) shall render or make available to the Trust managerial, investment, advisory and/or related services, office space and other services and facilities (including, if deemed advisable by the Board of Trustees, the management or supervision of the investments of the Trust) upon such terms and conditions as may be provided in such agreement or agreements (including, if deemed fair and equitable by the Board of Trustees, the compensation payable thereunder by the Trust).

SECTION 6.4Related Party Transactions.

(a)Without limiting any other procedures available by law or otherwise to the Trust, the Board of Trustees may authorize any agreement of the character described in Section 6.3 or other transaction with any person, corporation, association, company, trust, partnership (limited

8

or general) or other organization, although one or more of the Trustees or officers of the Trust may be a party to any such agreement or an officer, director, stockholder or member of such other party, and no such agreement or transaction shall be invalidated or rendered void or voidable solely by reason of the existence of any such relationship if the existence is disclosed or known to the Board of Trustees, and the contract or transaction is approved by the Board of Trustees (including the affirmative vote of a majority of the disinterested Trustees even if they constitute less than a quorum of the Board).  Any Trustee who is also a director, officer, stockholder or member of such other entity may be counted in determining the existence of a quorum at any meeting of the Board of Trustees considering such matter.

(b)Subsequent to the date hereof (the “Restriction Date”) the affirmative vote of a majority of the disinterested Trustees (even if they constitute less than a quorum of the Board) shall be required to approve the purchase by the Trust or its subsidiaries of any properties under the direct or indirect control of Samuel Zell or Starwood Capital Partners, L.P., a Delaware limited partnership, or in which he or it has a direct or indirect substantial economic interest on the Restriction Date.

SECTION 6.5Determinations by Board.  The determination as to any of the following matters, made in good faith by or pursuant to the direction of the Board of Trustees consistent with this Declaration of Trust and in the absence of actual receipt of an improper benefit in money, property or services or active and deliberate dishonesty established by a court, shall be final and conclusive and shall be binding upon the Trust and every holder of Shares:  (a) the amount of the net income of the Trust for any period and the amount of assets at any time legally available for the payment of dividends, redemption of Shares or the payment of other distributions with respect to Shares; (b) the amount of paid-in surplus, net assets, other surplus, annual or other net profit, net assets in excess of capital, undivided profits or excess of profits over losses on sales of assets; (c) the amount, purpose, time of creation, increase or decrease, alteration or cancellation of any reserves or charges and the propriety thereof (whether or not any obligation or liability for which such reserves or charges shall have been created shall have been paid or discharged); (d) the fair value, or any sale, bid or asked price to be applied in determining the fair value, of any asset owned or held by the Trust; and (e) any matters relating to the acquisition, holding and disposition of any assets by the Trust.

SECTION 6.6Reserved Powers of Board.  The enumeration and definition of powers of the Board of Trustees included in this Article VI shall in no way be limited or restricted by reference to or inference from the terms of any other clause of this or any other provision of the Declaration of Trust, or construed or deemed by inference or otherwise in any manner to exclude or limit the powers conferred upon the Board of Trustees under the general laws of the State of Maryland as now or hereafter in force.

SECTION 6.7REIT Qualification.  The Board of Trustees shall use its reasonable best efforts to cause the Trust and the Shareholders to qualify for federal income tax treatment in accordance with the REIT Provisions of the Code.  In furtherance of the foregoing, the Board of Trustee shall use its reasonable best efforts to take such actions as are necessary, and may take such actions as in its sole judgment and discretion are desirable, to preserve the status of the Trust as a REIT, including amending the provisions of this Declaration of Trust as provided in Article IX; provided, however, that if the Board of Trustees determines that it is no longer in the best interests

9

of the Trust for it to continue to qualify as a REIT, the Board of Trustees may revoke or otherwise terminate the Trust’s REIT election.

ARTICLE VII

RESTRICTION ON TRANSFER AND OWNERSHIP OF SHARES

SECTION 7.1Definitions.  For the purpose of this Article VII, the following terms shall have the following meanings:

Beneficial Ownership.  The term “Beneficial Ownership” shall mean ownership of Shares by a Person, whether the interest in Shares is held directly or indirectly (including by a nominee), and shall include interests that would be treated as owned through the application of Section 544 of the Code, as modified by Section 856(h)(1)(B) of the Code.  The terms “Beneficial Owner,” “Beneficially Owns” and “Beneficially Owned” shall have the correlative meanings.

Business Day.  The term “Business Day” shall mean any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in Chicago, Illinois are authorized or required by law, regulation or executive order to close.

Charitable Beneficiary.  The term “Charitable Beneficiary” shall mean one or more beneficiaries of the Charitable Trust as determined pursuant to Section 7.3(g), provided that each such organization must be described in Sections 501(c)(3), 170(b)(1)(A) and 170(c)(2) of the Code.

Charitable Trust.  The term “Charitable Trust” shall mean any trust provided for in Section 7.2(a)(2)(A) and Section 7.3(a).

Charitable Trustee.  The term “Charitable Trustee” shall mean the Person unaffiliated with the Trust and a Prohibited Owner, that is appointed by the Trust to serve as trustee of the Charitable Trust.

Code.  The term “Code” shall mean the Internal Revenue Code of 1986, as amended from time to time.

Constructive Ownership.  The term “Constructive Ownership” shall mean ownership of Shares by a Person, whether the interest in Shares is held directly or indirectly (including by a nominee), and shall include interests that would be treated as owned through the application of Section 318(a) of the Code, as modified by Section 856(d)(5) of the Code.  The terms “Constructive Owner,” “Constructively Owns” and “Constructively Owned” shall have the correlative meanings.

Declaration of Trust.  The term “Declaration of Trust” shall mean this Amended and Restated Declaration of Trust as filed for record with the SDAT, and any amendments thereto.

Excepted Holder.  The term “Excepted Holder” shall mean (i) a shareholder of the Trust for whom an Excepted Holder Limit is created by the Board of Trustees pursuant to Section 7.2(g) or

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(ii) a shareholder of the Trust who was an “Existing Holder” under the Amended and Restated Declaration of Trust of Equity Residential Properties Trust prior to the date hereof.

Excepted Holder Limit.  The term “Excepted Holder Limit” shall mean (i) provided that the affected Excepted Holder agrees to comply with the requirements established by the Board of Trustees pursuant to Section 7.2(g), and subject to adjustment pursuant to Section 7.2(h), the percentage limit established by the Board of Trustees pursuant to Section 7.2(g) or (ii) if the Excepted Holder is an Excepted Holder due to its prior status as an “Existing Holder” under the Amended and Restated Declaration of Trust of Equity Residential Properties Trust, the “Existing Holder Limit” as defined under such Amended and Restated Declaration of Trust.

Initial Date.  The term “Initial Date” shall mean the date upon which this Amended and Restated Declaration of Trust containing this Article VII is filed for record with the SDAT.

Market Price.  The term “Market Price” on any date shall mean, with respect to any class or series of outstanding Shares, the Closing Price for such Shares on such date.  The “Closing Price” on any date shall mean the last sale price for such Shares, regular way, or, in case no such sale takes place on such day, the average of the closing bid and asked prices, regular way, for such Shares, in either case as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on the NYSE or, if such Shares are not listed or admitted to trading on the NYSE, as reported on the principal consolidated transaction reporting system with respect to securities listed on the principal national securities exchange on which such Shares are listed or admitted to trading or, if such Shares are not listed or admitted to trading on any national securities exchange, the last quoted price, or, if not so quoted, the average of the high bid and low asked prices in the over-the-counter market, as reported by the NASDAQ Stock Market or, if such system is no longer in use, the principal other automated quotation system that may then be in use or, if such Shares are not quoted by any such organization, the average of the closing bid and asked prices as furnished by a professional market maker making a market in such Shares selected by the Board of Trustees or, in the event that no trading price is available for such Shares, the fair market value of Shares, as determined in good faith by the Board of Trustees.

NYSE.  The term “NYSE” shall mean the New York Stock Exchange, Inc.

Ownership Limit.  The term “Ownership Limit” shall mean (i) with respect to the Common Shares, 5.0% (in value or number of shares, whichever is more restrictive) of the outstanding Common Shares of the Trust; and (ii) with respect to any class or series of Preferred Shares, 5.0% (in value or number of Shares, whichever is more restrictive) of the outstanding shares of such class or series of Preferred Shares of the Trust.

Person.  The term “Person” shall mean an individual, corporation, partnership, estate, trust (including a trust qualified under Sections 401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code, joint stock company or other entity and also includes a group as that term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended.

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Prohibited Owner.  The term “Prohibited Owner” shall mean, with respect to any purported Transfer, any Person who, but for the provisions of Section 7.2(a), would Beneficially Own or Constructively Own Shares, and if appropriate in the context, shall also mean any Person who would have been the record owner of Shares that the Prohibited Owner would have so owned.

REIT.  The term “REIT” shall mean a real estate investment trust within the meaning of Section 856 of the Code.

Restriction Termination Date.  The term “Restriction Termination Date” shall mean the first day after the Initial Date on which the Board of Trustees determines that it is no longer in the best interests of the Trust to attempt to, or continue to, qualify as a REIT or that compliance with the restrictions and limitations on Beneficial Ownership, Constructive Ownership and Transfers of Shares set forth herein is no longer required in order for the Trust to qualify as a REIT.

SDAT.  The term “SDAT” shall mean the State Department of Assessments and Taxation of Maryland.

Transfer.  The term “Transfer” shall mean any issuance, sale, transfer, gift, assignment, devise or other disposition, as well as any other event that causes any Person to acquire Beneficial Ownership or Constructive Ownership, or any agreement to take any such actions or cause any such events, of Shares or the right to vote or receive dividends on Shares, including (a) a change in the capital structure of the Trust, (b) a change in the relationship between two or more Persons which causes a change in ownership of Shares by application of Section 544 of the Code, as modified by Section 856(h), (c) the granting or exercise of any option or warrant (or any disposition of any option or warrant), pledge, security interest, or similar right to acquire Shares, (d) any disposition of any securities or rights convertible into or exchangeable for Shares or any interest in Shares or any exercise of any such conversion or exchange right and (e) Transfers of interests in other entities that result in changes in Beneficial or Constructive Ownership of Shares; in each case, whether voluntary or involuntary, whether owned of record, Constructively Owned or Beneficially Owned and whether by operation of law or otherwise.  (For purposes of this Article VII, the right of a limited partner in ERP Operating Limited Partnership, an Illinois limited partnership, to require the partnership to redeem such limited partner’s units of partnership interest pursuant to Section 3.2 of the Agreement of Limited Partnership of ERP Operating Limited Partnership shall not be considered to be an option or similar right to acquire Shares of the Trust.) The terms “Transferring” and “Transferred” shall have the correlative meanings.

SECTION 7.2Shares.

(a)  Ownership Limitations.  During the period commencing on the Initial Date and prior to the Restriction Termination Date:

(1)  Basic Restrictions.

(A)(i)  No Person, other than an Excepted Holder, shall Beneficially Own or Constructively Own Shares in excess of the Ownership Limit and (ii) no

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Excepted Holder shall Beneficially Own or Constructively Own Shares in excess of the Excepted Holder Limit for such Excepted Holder.

(B)No Person shall Beneficially or Constructively Own Shares to the extent that (i) such Beneficial Ownership of Shares would result in the Trust being “closely held” within the meaning of Section 856(h) of the Code (without regard to whether the ownership interest is held during the last half of a taxable year), or (ii) such Beneficial or Constructive Ownership of Shares would result in the Trust otherwise failing to qualify as a REIT (including, but not limited to, Constructive Ownership that would result in the Trust owning (actually or Constructively) an interest in a tenant that is described in Section 856(d)(2)(B) of the Code if the income derived by the Trust from such tenant would cause the Trust to fail to satisfy any of the gross income requirements of Section 856(c) of the Code).

(C)No Person shall Transfer any Shares if, as a result of the Transfer, the Shares would be beneficially owned by less than 100 Persons (determined without reference to the rules of attribution under Section 544 of the Code).  Notwithstanding any other provisions contained herein, any Transfer of Shares (whether or not such Transfer is the result of a transaction entered into through the facilities of the NYSE or any other national securities exchange or automated inter-dealer quotation system) that, if effective, would result in Shares being beneficially owned by less than 100 Persons (determined under the principles of Section 856(a)(5) of the Code) shall be void ab initio, and the intended transferee shall acquire no rights in such Shares.

(2)Transfer in Trust.  If any Transfer of Shares (whether or not such Transfer is the result of a transaction entered into through the facilities of the NYSE or any other national securities exchange or automated inter-dealer quotation system) occurs which, if effective, would result in any Person Beneficially Owning or Constructively Owning Shares in violation of Section 7.2(a)(1)(A) or (B),

(i)then that number of Shares the Beneficial or Constructive Ownership of which otherwise would cause such Person to violate Section 7.2(a)(1)(A) or (B) (rounded to the nearest whole share) shall be automatically transferred to a Charitable Trust for the benefit of a Charitable Beneficiary, as described in Section 7.3, effective as of the close of business on the Business Day prior to the date of such Transfer, and such Person shall acquire no rights in such Shares; or

(ii)if the transfer to the Charitable Trust described in clause (i) of this sentence would not be effective for any reason to prevent the violation of Section 7.2(a)(1)(A) or (B), then the Transfer of that number of Shares that otherwise would cause any Person to violate Section 7.2(a)(1)(A) or (B) shall be void ab initio, and the intended transferee shall acquire no rights in such Shares.

(b)Remedies for Breach.  If the Board of Trustees or any duly authorized committee thereof shall at any time determine in good faith that a Transfer or other event has taken place that results in a violation of Section 7.2(a) or that a Person intends to acquire or has attempted to acquire Beneficial or Constructive Ownership of any Shares in violation of Section 7.2(a) (whether or not such violation is intended), the Board of Trustees or a committee thereof shall take

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such action as it deems advisable to refuse to give effect to or to prevent such Transfer or other event, including, without limitation, causing the Trust to redeem Shares, refusing to give effect to such Transfer on the books of the Trust or instituting proceedings to enjoin such Transfer or other event; provided, however, that any Transfer or attempted Transfer or other event in violation of Section 7.2(a) shall automatically result in the transfer to the Charitable Trust described above, and, where applicable, such Transfer (or other event) shall be void ab initio as provided above irrespective of any action (or non-action) by the Board of Trustees or a committee thereof.

(c)Notice of Restricted Transfer.  Any Person who acquires or attempts or intends to acquire Beneficial Ownership or Constructive Ownership of Shares that will or may violate Section 7.2(a)(l), or any Person who would have owned Shares that resulted in a transfer to the Charitable Trust pursuant to the provisions of Section 7.2(a)(2), shall immediately give written notice to the Trust of such event, or in the case of such a proposed or attempted transaction, give at least 15 days prior written notice, and shall provide to the Trust such other information as the Trust may request in order to determine the effect, if any, of such acquisition or ownership on the Trust’s status as a REIT.

(d)Owners Required To Provide Information.  From the Initial Date and prior to the Restriction Termination Date:

(1)every owner of more than five percent (or such lower percentage as required by the Code or the Treasury Regulations promulgated thereunder) of the outstanding Shares, within 30 days after the end of each taxable year, shall give written notice to the Trust stating the name and address of such owner, the number of Shares Beneficially Owned and a description of the manner in which such Shares are held; provided that a shareholder of record who holds outstanding Shares as nominee for another Person, which other Person is required to include in gross income the dividends received on such Shares (an “Actual Owner”), shall give written notice to the Trust stating the name and address of such Actual Owner and the number of Shares of such Actual Owner with respect to which the shareholder of record is nominee.  Each owner shall provide to the Trust such additional information as the Trust may request in order to determine the effect, if any, of such Beneficial Ownership on the Trust’s status as a REIT and to ensure compliance with the Ownership Limit.

(2)each Person who is a Beneficial or Constructive Owner of Shares and each Person (including the shareholder of record) who is holding Shares for a Beneficial or Constructive Owner shall provide to the Trust such information as the Trust may request, in good faith, in order to determine the Trust’s status as a REIT and to comply with requirements of any taxing authority or governmental authority or to determine such compliance.

(e)Remedies Not Limited.  Subject to Article III of the Declaration of Trust, nothing contained in this Section 7.2 shall limit the authority of the Board of Trustees to take such other action as it deems necessary or advisable to protect the Trust and the interests of its shareholders in preserving the Trust’s status as a REIT.

(f)Ambiguity.  If Section 7.2 or 7.3 requires an action by the Board of Trustees and the Declaration of Trust fails to provide specific guidance with respect to such action, the

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Board of Trustees shall have the power to determine the action to be taken so long as such action is not contrary to the provisions of Sections 7.1, 7.2 or 7.3.

(g)Exceptions.

(1)The Board, in its sole and absolute discretion, may grant to any Person who makes a request therefor an exception to the Ownership Limit with respect to the ownership of any series or class of Preferred Shares, subject to the following conditions and limitations: (A) the Board shall have determined that (x) assuming such Person would Beneficially or Constructively Own the maximum amount of Common Shares and Preferred Shares permitted as a result of the exception to be granted and (y) assuming that all other Persons who would be treated as “individuals” for purposes of Section 542(a)(2) (determined taking into account Section 856(h)(3)(A) of the Code) would Beneficially or Constructively Own the maximum amount of Common Shares and Preferred Shares permitted under this Article VII (taking into account any exception, waiver, or exemption granted under this Section 7.2(g) to (or with respect to) such Persons), the Trust would not be “closely held” within the meaning of Section 856(h) of the Code (assuming that the ownership of Shares is determined during the second half of a taxable year) and would not otherwise fail to qualify as a REIT; and (B) such Person provides to the Board such representations and undertakings, if any, as the Board may, in its sole and absolute discretion, require (including, without limitation, an agreement as to a reduced Ownership Limit or Excepted Holder Limit for such Person with respect to the Beneficial or Constructive Ownership of one or more other classes of Shares not subject to the exception), and such Person agrees that any violation of such representations and undertakings or any attempted violation thereof will result in the application of the remedies set forth in Section 7.2 with respect to Shares held in excess of the Ownership Limit or the Excepted Holder Limit (as may be applicable) with respect to such Person (determined without regard to the exception granted such Person under this subparagraph (1)).  If a member of the Board requests that the Board grant an exception pursuant to this subparagraph (1) with respect to such member or with respect to any other Person if such Board member would be considered to be the Beneficial or Constructive Owner of Shares owned by such Person, such member of the Board shall not participate in the decision of the Board as to whether to grant any such exception.

(2)In addition to exceptions permitted under subparagraph (1) above, the Board shall except a Person from the Ownership Limit if: (i) such Person submits to the Board information satisfactory to the Board, in its reasonable discretion, demonstrating that such Person is not an individual for purposes of Section 542(a)(2) of the Code (determined taking into account Section 856(h)(3)(A) of the Code); (ii) such Person submits to the Board information satisfactory to the Board, in its reasonable discretion, demonstrating that no Person who is an individual for purposes of Section 542(a)(2) of the Code (determined taking into account Section 856(h)(3)(A) of the Code) would be considered to Beneficially Own Shares in excess of the Ownership Limit by reason of the Excepted Holder’s ownership of Shares in excess of the Ownership Limit pursuant to the exception granted under this subparagraph (2); (iii) such Person submits to the Board information satisfactory to the Board, in its reasonable discretion, demonstrating that clause (ii) of subparagraph (1)(B) of Section 7.2(a) will not be violated by reason of the Excepted Holder’s ownership of Shares in excess of the Ownership Limit pursuant to the exception granted under this subparagraph (2); and (iv) such Person provides to the Board such representations and undertakings, if any, as the Board may, in its reasonable discretion, require to ensure that the

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conditions in clauses (i), (ii) and (iii) hereof are satisfied and will continue to be satisfied throughout the period during which such Person owns Shares in excess of the Ownership Limit pursuant to any exception thereto granted under this subparagraph (2), and such Person agrees that any violation of such representations and undertakings or any attempted violation thereof will result in the application of the remedies set forth in Section 7.2 with respect to Shares held in excess of the Ownership Limit with respect to such Person (determined without regard to the exception granted such Person under this subparagraph (2)).

(3)Prior to granting any exception or exemption pursuant to subparagraph (1) or (2), the Board may require a ruling from the IRS or an opinion of counsel, in either case in form and substance satisfactory to the Board, in its sole and absolute discretion as it may deem necessary or advisable in order to determine or ensure the Trust’s status as a REIT; provided, however, that the Board shall not be obligated to require obtaining a favorable ruling or opinion in order to grant an exception hereunder.

(4)Subject to Section 7.2(a)(1)(B), an underwriter that participates in a public offering or a private placement of Shares (or securities convertible into or exchangeable for Shares) may Beneficially or Constructively Own Shares (or securities convertible into or exchangeable for Shares) in excess of the Ownership Limit, but only to the extent necessary to facilitate such public offering or private placement.

(5)The Board of Trustees may only reduce the Excepted Holder Limit for an Excepted Holder: (1) with the written consent of such Excepted Holder at any time, or (2) pursuant to the terms and conditions of the agreements and undertakings entered into with such Excepted Holder in connection with the establishment of the Excepted Holder Limit for that Excepted Holder.  No Excepted Holder Limit shall be reduced to a percentage that is less than the Ownership Limit.

(h)Increase in Ownership Limit.  The Board of Trustees may from time to time increase the Ownership Limit, subject to the limitations provided in this Section 7.2(h).

(1)The Ownership Limit may not be increased if, after giving effect to such increase, five Persons who are considered individuals pursuant to Section 542 of the Code, as modified by Section 856(h)(3) of the Code (taking into account all of the Excepted Holders), could Beneficially Own, in the aggregate, more than 49.5% of the value of the outstanding Shares.

(2)Prior to the modification of the Ownership Limit pursuant to this Section 7.2(h), the Board may require such opinions of counsel, affidavits, undertakings or agreements as it may deem necessary or advisable in order to determine or ensure the Trust’s status as a REIT if the modification in the Ownership Limit were to be made.

(i)Legend.  Each certificate for Shares shall bear substantially the following legend:

The shares represented by this certificate are subject to restrictions on Beneficial and Constructive Ownership and Transfer for the purpose of the Trust’s maintenance of its status as a Real Estate Investment Trust (a

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“REIT”) under the Internal Revenue Code of 1986, as amended (the “Code”).  Subject to certain further restrictions and except as expressly provided in the Trust’s Declaration of Trust, (i) no Person may Beneficially or Constructively Own Common Shares of the Trust in excess of 5.0 percent (in value or number of shares) of the outstanding Common Shares of the Trust unless such Person is an Excepted Holder (in which case the Excepted Holder Limit shall be applicable); (ii) with respect to any class or series of Preferred Shares, no Person may Beneficially or Constructively Own more than 5.0 percent (in value or number of shares) of the outstanding shares of such class or series of Preferred Shares of the Trust, unless such Person is an Excepted Holder (in which case the Excepted Holder Limit shall be applicable); (iii) no Person may Beneficially or Constructively Own Shares that would result in the Trust being “closely held” under Section 856(h) of the Code or otherwise cause the Trust to fail to qualify as a REIT; and (iv) no Person may Transfer Shares if such Transfer would result in Shares of the Trust being owned by fewer than 100 Persons.  Any Person who Beneficially or Constructively Owns or attempts to Beneficially or Constructively Own Shares which cause or will cause a Person to Beneficially or Constructively Own Shares in excess or in violation of the above limitations must immediately notify the Trust.  If any of the restrictions on transfer or ownership are violated, the Shares represented hereby will be automatically transferred to a Charitable Trustee of a Charitable Trust for the benefit of one or more Charitable Beneficiaries.  In addition, upon the occurrence of certain events, attempted Transfers in violation of the restrictions described above may be void ab initio.  A Person who attempts to Beneficially or Constructively Own Shares in violation of the ownership limitations described above shall have no claim, cause of action, or any recourse whatsoever against a transferor of such Shares.  All capitalized terms in this legend have the meanings defined in the Trust’s Declaration of Trust, as the same may be amended from time to time, a copy of which, including the restrictions on transfer and ownership, will be furnished to each holder of Shares of the Trust on request and without charge.

Instead of the foregoing legend, the certificate may state that the Trust will furnish a full statement about certain restrictions on transferability to a shareholder on request and without charge.

SECTION 7.3Transfer of Shares in Trust.

(a)Ownership in Trust.  Upon any purported Transfer or other event described in Section 7.2(a)(2) that would result in a transfer of Shares to a Charitable Trust, such Shares shall be deemed to have been transferred to the Charitable Trustee as trustee of a Charitable Trust for the exclusive benefit of one or more Charitable Beneficiaries.  Such transfer to the Charitable Trustee shall be deemed to be effective as of the close of business on the Business Day prior to the purported Transfer or other event that results in the transfer to the Charitable Trust pursuant to Section 7.2(a)(2).  The Charitable Trustee shall be appointed by the Trust and shall be a Person

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unaffiliated with the Trust and any Prohibited Owner.  Each Charitable Beneficiary shall be designated by the Trust as provided in Section 7.3(g).

(b)Status of Shares Held by the Charitable Trustee.  Shares held by the Charitable Trustee shall be issued and outstanding Shares of the Company.  The Prohibited Owner shall have no rights in the Shares held by the Charitable Trustee.  The Prohibited Owner shall not benefit economically from ownership of any Shares held in trust by the Charitable Trustee, shall have no rights to dividends or other distributions and shall not possess any rights to vote or other rights attributable to the Shares held in the Charitable Trust.  The Prohibited Owner shall have no claim, cause of action, or any other recourse whatsoever against the purported transferor of such Shares.

(c)Dividend and Voting Rights.  The Charitable Trustee shall have all voting rights and rights to dividends or other distributions with respect to Shares held in the Charitable Trust, which rights shall be exercised for the exclusive benefit of the Charitable Beneficiary.  Any dividend or other distribution paid prior to the discovery by the Trust that Shares have been transferred to the Charitable Trustee shall be paid with respect to such Shares to the Charitable Trustee upon demand and any dividend or other distribution authorized but unpaid shall be paid when due to the Charitable Trustee.  Any dividends or distributions so paid over to the Charitable Trustee shall be held in trust for the Charitable Beneficiary.  The Prohibited Owner shall have no voting rights with respect to Shares held in the Charitable Trust and, subject to Maryland law, effective as of the date that Shares have been transferred to the Charitable Trustee, the Charitable Trustee shall have the authority (at the Charitable Trustee’s sole discretion) (i) to rescind as void any vote cast by a Prohibited Owner prior to the discovery by the Trust that Shares have been transferred to the Charitable Trustee and (ii) to recast such vote in accordance with the desires of the Charitable Trustee acting for the benefit of the Charitable Beneficiary; provided, however, that if the Trust has already taken irreversible action, then the Charitable Trustee shall not have the power to rescind and recast such vote.  Notwithstanding the provisions of this Article VII, until the Trust has received notification that Shares have been transferred into a Charitable Trust, the Trust shall be entitled to rely on its share transfer and other shareholder records for purposes of preparing lists of shareholders entitled to vote at meetings, determining the validity and authority of proxies and otherwise conducting votes of shareholders.

(d)Rights Upon Liquidation.  Upon any voluntary or involuntary liquidation, dissolution or winding up of or any distribution of the assets of the Trust, the Charitable Trustee shall be entitled to receive, ratably with each other holder of Shares of the class or series of Shares that is held in the Charitable Trust, that portion of the assets of the Trust available for distribution to the holders of such class or series (determined based upon the ratio that the number of Shares or such class or series of Shares held by the Charitable Trustee bears to the total number of Shares of such class or series of Shares then outstanding).  The Charitable Trustee shall distribute any such assets received in respect of the Shares held in the Charitable Trust in any liquidation, dissolution or winding up of, or distribution of the assets of the Trust, in accordance with Section 7.3(e).

(e)Sale of Shares by Charitable Trustee.  Within 20 days of receiving notice from the Trust that Shares have been transferred to the Charitable Trust, the Charitable Trustee of the Charitable Trust shall sell the Shares held in the Charitable Trust to a person, designated by the Charitable Trustee, whose ownership of the Shares will not violate the ownership limitations set

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forth in Section 7.2(a)(1).  Upon such sale, the interest of the Charitable Beneficiary in the Shares sold shall terminate and the Charitable Trustee shall distribute the net proceeds of the sale to the Prohibited Owner and to the Charitable Beneficiary as provided in this Section 7.3(e).  The Prohibited Owner shall receive the lesser of (1) the price paid by the Prohibited Owner for the Shares or, if the Prohibited Owner did not give value for the Shares in connection with the event causing the Shares to be held in the Charitable Trust (e.g., in the case of a gift, devise or other such transaction), the Market Price of the Shares on the day of the event causing the Shares to be held in the Charitable Trust and (2) the price per share received by the Charitable Trustee from the sale or other disposition of the Shares held in the Charitable Trust.  Any net sales proceeds in excess of the amount payable to the Prohibited Owner shall be immediately paid to the Charitable Beneficiary.  If, prior to the discovery by the Trust that Shares have been transferred to the Charitable Trustee, such Shares are sold by a Prohibited Owner, then (i) such Shares shall be deemed to have been sold on behalf of the Charitable Trust and (ii) to the extent that the Prohibited Owner received an amount for such Shares that exceeds the amount that such Prohibited Owner was entitled to receive pursuant to this Section 7.3(e), such excess shall be paid to the Charitable Trustee upon demand.  The Charitable Trustee shall have the right and power (but not the obligation) to offer any Equity Share held in trust for sale to the Trust on such terms and conditions as the Charitable Trustee shall deem appropriate.

(f)Purchase Right in Shares Transferred to the Charitable Trustee.  Shares transferred to the Charitable Trustee shall be deemed to have been offered for sale to the Trust, or its designee, at a price per share equal to the lesser of (i) the price per share in the transaction that resulted in such transfer to the Charitable Trust (or, in the case of a devise or gift, the Market Price at the time of such devise or gift) and (ii) the Market Price on the date the Trust, or its designee, accepts such offer.  The Trust shall have the right to accept such offer until the Charitable Trustee has sold the Shares held in the Charitable Trust pursuant to Section 7.3(e).  Upon such a sale to the Trust, the interest of the Charitable Beneficiary in the Shares sold shall terminate and the Charitable Trustee shall distribute the net proceeds of the sale to the Prohibited Owner.

(g)Designation of Charitable Beneficiaries.  By written notice to the Charitable Trustee, the Trust shall designate one or more nonprofit organizations to be the Charitable Beneficiary of the interest in the Charitable Trust such that (i) Shares held in the Charitable Trust would not violate the restrictions set forth in Section 7.2(a)(1) in the hands of such Charitable Beneficiary and (ii) each such organization must be described in Sections 501(c)(3), 170(b)(1)(A) or 170(c)(2) of the Code.

SECTION 7.4NYSE Transactions.  Nothing in this Article VII shall preclude the settlement of any transaction entered into through the facilities of the NYSE or any other national securities exchange or automated inter-dealer quotation system.  The fact that the settlement of any transaction is so permitted shall not negate the effect of any other provision of this Article VII and any transferee in such a transaction shall be subject to all of the provisions and limitations set forth in this Article VII.

SECTION 7.5Enforcement.  The Trust is authorized specifically to seek equitable relief, including injunctive relief, to enforce the provisions of this Article VII.

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SECTION 7.6Non-Waiver.  No delay or failure on the part of the Trust or the Board of Trustees in exercising any right hereunder shall operate as a waiver of any right of the Trust or the Board of Trustees, as the case may be, except to the extent specifically waived in writing.

SECTION 7.7 - - 7-22[RESERVED]

SECTION 7.23[Intentionally Omitted.]

SECTION 7.24[See Article XIII, Section 13.2 (c)]

SECTION 7.25[See Article XIII, Section 13.3 (c)]

SECTION 7.26[See Article XIII, Section 13.4 (c)]

ARTICLE VIII

SHAREHOLDERS

SECTION 8.1Meetings of Shareholders.  There shall be an annual meeting of the Shareholders, to be held on proper notice, at such time (after delivery of the annual report) and convenient location as shall be determined by or in the manner prescribed in the Bylaws, at which Trustees shall be elected and any other proper business may be conducted.  Except as otherwise provided in this Declaration of Trust, special meetings of Shareholders may be called in the manner provided in the Bylaws.  If there are no Trustees, the President or any other officer of the Trust shall promptly call a special meeting of the Shareholders entitled to vote for the election of successor Trustees.  Any meeting may be adjourned and reconvened as the Trustees determine or as provided in the Bylaws.

SECTION 8.2Voting Rights of Shareholders.  Subject to the provisions of any class or series of Shares then outstanding, the Shareholders shall be entitled to vote only on the following matters: (a) the election or removal of Trustees; (b) the amendment of this Declaration of Trust; (c) the voluntary dissolution or termination of the Trust; (d) the merger of the Trust, provided, however, that the Shareholders shall not be entitled to vote on a merger of the Trust which may be approved pursuant to the provisions of Title 8 by a majority of the entire Board of Trustees without a vote of the Shareholders and, further provided, that if a shareholder vote is required pursuant to the provisions of Title 8, such merger shall be approved by the affirmative vote of the holders of not less than a majority of all the Shares then outstanding and entitled to vote thereon, (e) the sale or other disposition of all or substantially all of the Trust Property, provided, however, that the sale or other disposition of all or substantially all of the Trust Property shall be approved by the affirmative vote of the holders of not less than a majority of all the Shares then outstanding and entitled to vote thereon, and (f) such other matters with respect to which the Board of Trustees has adopted a resolution declaring advisable or recommending a proposal and directing that the matter be submitted to the Shareholders for consideration.  Except with respect to the foregoing matters, no action taken by the Shareholders at any meeting shall in any way bind the Trustees.

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SECTION 8.3Board Approval.  The submission of any action to the Shareholders for their consideration shall first be approved by the Board of Trustees.

ARTICLE IX

AMENDMENT

SECTION 9.1By Shareholders.

(a)Except as provided in Section 9.2 and subsection (b) hereof, this Declaration of Trust may be amended only by the affirmative vote of the holders of not less than two-thirds of all the Shares then outstanding and entitled to vote on the matter.

(b)Notwithstanding the provisions of Section 9.1(a) hereof and subject to the provisions of any class or series of Shares then outstanding, this Declaration of Trust may be amended pursuant to the terms of Articles of Merger accepted for record by the SDAT relating to a merger of any entity or entities with the Trust, provided that such merger shall have been approved by the affirmative vote of not less than a majority of the Shares then outstanding and entitled to vote thereon.

SECTION 9.2By Trustees.  The Trustees, by a two-thirds vote, may amend provisions of this Declaration of Trust from time to time to enable the Trust to qualify as a real estate investment trust under the Code or Under Title 8.

ARTICLE X

DURATION OF TRUST

The Trust shall continue perpetually unless terminated pursuant to any applicable provision of Title 8.  The Trust may be voluntarily dissolved or its existence terminated only by the affirmative vote of the holders of not less than two-thirds of all the Shares then outstanding and entitled to vote on the matter.  The Trust may sell or otherwise dispose of all or substantially all of the Trust Property only by the affirmative vote of the holders of not less than a majority of all the Shares then outstanding and entitled to vote on the matter.  (a) Upon the termination of the Trust:

(i)The Trust shall carry on no business except for the purpose of winding up its affairs.

(ii)The Trustees shall proceed to wind up the affairs of the Trust and all of the powers of the Trustees under this Declaration of Trust shall continue, including the powers to fulfill or discharge the Trust’s contracts, collect its assets, sell, convey, assign, exchange, transfer or otherwise dispose of all or any part of the remaining property of the Trust to one or more persons at public or private sale for consideration which may consist in whole or in part of cash, securities or other property of any kind, discharge or pay its liabilities and do all other acts appropriate to liquidate its business.

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(iii)After paying or adequately providing for the payment of all liabilities, and upon receipt of such releases, indemnities and agreements as they deem necessary for their protection, the Trust may distribute the remaining property of the Trust among the Shareholders so that after payment in full or the setting apart for payment of such preferential amounts, if any, to which the holders of any Shares at the time outstanding shall be entitled, the remaining property of the Trust shall, subject to any participating or similar rights of Shares at the time outstanding, be distributed ratably among the holders of Common Shares at the time outstanding.

(b)  After termination of the Trust, the liquidation of its business and the distribution to the Shareholders as herein provided, a majority of the Trustees shall execute and file with the Trust’s records a document certifying that the Trust has been duly terminated, and the Trustees shall be discharged from all liabilities and duties hereunder, and the rights and interests of all Shareholders shall cease.

ARTICLE XI

LIABILITY OF SHAREHOLDERS, TRUSTEES, OFFICERS,

EMPLOYEES AND AGENTS AND TRANSACTIONS BETWEEN

THEM AND THE TRUST

SECTION 11.1Limitation of Shareholder Liability.  No Shareholder shall be liable for any debt, claim, demand, judgment or obligation of any kind of, against or with respect to the Trust by reason of his being a Shareholder, nor shall any Shareholder be subject to any personal liability whatsoever, in tort, contract or otherwise, to any Person in connection with the Trust Property or the affairs of the Trust.

SECTION 11.2Limitation of Trustee and Officer Liability.  To the maximum extent that Maryland law in effect from time to time permits limitation of the liability of trustees and officers of a real estate investment trust, no Trustee or officer of the Trust shall be liable to the Trust or to any Shareholder for money damages.  Neither the amendment nor repeal of this Section, nor the adoption or amendment of any other provision of this Declaration of Trust inconsistent with this Section, shall apply to or affect in any respect the applicability of the preceding sentence with respect to any act or failure to act which occurred prior to such amendment, repeal or adoption.  In the absence of any Maryland statute limiting the liability of trustees and officers of a Maryland real estate investment trust for money damages in a suit by or on behalf of the Trust or by any Shareholder, no Trustee or officer of the Trust shall be liable to the Trust or to any Shareholder for money damages except to the extent that (a) the Trustee or officer actually received an improper benefit or profit in money, property or services, for the amount of the benefit or profit in money, property or services actually received or (b) a judgment or other final adjudication adverse to the Trustee or officer is entered in a proceeding based on a finding in the proceeding that the Trustee’s or officer’s action or failure to act was the result of active and deliberate dishonesty and was material to the cause of action adjudicated in the proceeding.

SECTION 11.3Indemnification and Advance for Expenses.  The Trust shall have the power, to the maximum extent permitted by Maryland law in effect from time to time, to obligate

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itself to indemnify, and to pay or reimburse reasonable expenses in advance of final disposition of a proceeding to, (a) any individual who is a present or former Shareholder, Trustee or officer of the Trust or (b) any individual who, while a Shareholder, Trustee or officer of the Trust and at the express request of the Trust, serves or has served another corporation, partnership, joint venture, trust, employee benefit plan or any other enterprise as a director, officer, Shareholder, partner or trustee of such corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, from and against all claims and liabilities to which such person may become subject by reason of his being or having been a Shareholder, Trustee or officer.  The Trust shall have the power, with the approval of its Board of Trustees, to provide such indemnification and advancement of expenses to a person who served a predecessor of the Trust in any of the capacities described in (a) or (b) above and to any employee or agent of the Trust or a predecessor of the Trust.

SECTION 11.4Transactions Between the Trust and its Trustees, Officers, Employees and Agents.  Subject to any express restriction in this Declaration of Trust, including (but not limited to) Section 6.4, or any restriction adopted by the Trustees in the Bylaws or by resolution, the Trust may enter into any contract or transaction of any kind (including, without limitation, for the purchase or sale of property or for any type of services, including those in connection with the underwriting or the offer or sale of Securities of the Trust) with any Person, including any Trustee, officer, employee or agent of the Trust or any Person Affiliated with a Trustee, officer, employee or agent of the Trust, whether or not any of them has a financial interest in such transaction.

ARTICLE XII

MISCELLANEOUS

SECTION 12.1Governing Law.  This Declaration of Trust is executed by the Trustees and delivered in the State of Maryland with reference to the laws thereof, and the rights of all parties and the validity, construction and effect of every provision hereof shall be subject to and construed according to the laws of the State of Maryland without regard to conflicts of laws provisions thereof.

SECTION 12.2Reliance by Third Parties.  Any certificate shall be final and conclusive as to any Person dealing with the Trust if executed by an individual who, according to the records of the Trust or of any recording office in which this Declaration of Trust may be recorded, appears to be the Secretary or an Assistant Secretary of the Trust or a Trustee, and if certifying to: (a) the number or identity of Trustees, officers of the Trust or Shareholders; (b) the due authorization of the execution of any document; (c) any action or vote taken, and the existence of a quorum at a meeting of Trustees or Shareholders; (d) a copy of this Declaration or of the Bylaws as a true and complete copy as then in force; (e) an amendment to this Declaration; (f) the termination of the Trust; or (g) the existence of any fact or facts which relate to the affairs of the Trust.  No purchaser, lender, transfer agent or other Person shall be bound to make any inquiry concerning the validity of any transaction purporting to be made on behalf of the Trust by the Trustees or by any officer, employee or agent of the Trust.

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SECTION 12.3Severability.

(a)The provisions of this Declaration of Trust are severable, and if the Trustees shall determine, with the advice of counsel, that any one or more of such provisions (the “Conflicting Provisions”) are in conflict with the REIT Provisions of the Code, Title 8 or any other applicable federal or state law, the Conflicting Provisions shall be deemed never to have constituted a part of this Declaration of Trust, even without any amendment of this Declaration pursuant to Article IX; provided, however, that such determination by the Trustees shall not affect or impair any of the remaining provisions of this Declaration of Trust or render invalid or improper any action taken or omitted prior to such determination.  No Trustee shall be liable for making or failing to make such a determination.

(b)If any provision of this Declaration of Trust shall be held invalid or unenforceable in any jurisdiction, such holding shall not in any manner affect or render invalid or unenforceable such provision in any other jurisdiction or any other provision of this Declaration of Trust in any jurisdiction.

SECTION 12.4Construction.  In this Declaration of Trust, unless the context otherwise requires, words used in the singular or in the plural include both the plural and singular and words denoting any gender include all genders.  The title and headings of different parts of this Declaration are inserted for convenience and shall not affect the meaning, construction or effect of this Declaration.  In defining or interpreting the powers and duties of the Trust and its Trustees and officers, reference may be made by the Board of Trustees and the officers of the Trust, to the extent appropriate and not inconsistent with the Code or Title 8, to Titles 1 through 3 of the Corporations and Associations Article of the Annotated Code of Maryland.  In furtherance and not in limitation of the foregoing, in accordance with the provisions of Title 3, Subtitles 6 and 7, of the Corporations and Associations Article of the Annotated Code of Maryland, the Trust shall be included within the definition of “corporation” for purposes of such provisions.

SECTION 12.5Recordation.  This Declaration of Trust and any amendment or supplement hereto shall be filed for record with the State Department of Assessments and Taxation of Maryland and may also be filed or recorded in such other places as the Trustees deem appropriate, but failure to file for record this Declaration or any amendment or supplement hereto in any office other than in the State of Maryland shall not affect or impair the validity or effectiveness of this Declaration or any amendment hereto.  A restated Declaration shall, upon filing, be conclusive evidence of all amendments or supplements contained therein and may thereafter be referred to in lieu of the original Declaration and the various amendments or supplements thereto.

ARTICLE XIII

DESIGNATION OF PREFERRED SHARES

SECTION 13.1[Intentionally Omitted]

SECTION 13.2Series B Preferred Shares.  Pursuant to Section 5.4 of this Declaration, a series of preferred shares of beneficial interest designated 9¹/₈% Series B Cumulative

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Redeemable Preferred Shares of Beneficial Interest ($0.01 Par Value Per Share) (Liquidation Preference $250.00 Per Share) (collectively, the “Series B Preferred Shares”) is hereby established on the following terms:

(a)Certain Definitions.

Unless the context otherwise requires, the terms defined in this Section 13.2(a) shall have the meanings herein specified (with terms defined in the singular having comparable meanings when used in the plural).

“Business Day” shall mean any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in New York City are authorized or required by law, regulation or executive order to close.

“Common Shares” shall mean the common shares of beneficial interest, $.01 par value per share, of the Trust.

“Dividend Period” shall have the meaning set forth in Section 13.2(b)(3).

“Junior Shares” shall have the meaning set forth in Section 13.2(b)(2).

“Person” shall mean an individual, corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code, joint stock company or other entity, and also includes a group as that term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended; but does not include an underwriter which participates in a public offering of the Series B Preferred Shares provided that the ownership of Series B Preferred Shares by such underwriter would not result in the Trust being “closely held” within the meaning of Section 856(h) of the Code, or would otherwise result in the Trust failing to qualify as a REIT.

“Preferred Shares” shall mean preferred shares of beneficial interest, $.01 par value per share, including Series A Preferred Shares, Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares, Series E Preferred Shares, and Series F Preferred Shares.

“Quarterly Dividend Date” shall have the meaning set forth in Section 13.2(b)(3) below.

“Record Date” shall have the meaning set forth in Section 13.2(b)(3) below.

“REIT” shall mean a Real Estate Investment Trust under Section 856 of the Code.

“Series B Redemption Date” shall have the meaning set forth in Section 13.2(b)(5) below.

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“Series B Redemption Price” shall have the meaning set forth in Section 13.2(b)(5) below.

(b)Series B Preferred Shares

(1)Number.  The maximum number of shares of the Series B Preferred Shares shall be 575,000.

(2)Relative Seniority.  In respect of rights to receive dividends and to participate in distributions or payments in the event of any Liquidation, dissolution or winding up of the Trust, the Series B Preferred Shares shall rank pari passu with any other preferred shares of beneficial interest of the Trust, including the Series A Preferred Shares, Series C Preferred Shares, Series D Preferred Shares, Series E Preferred Shares and Series F Preferred Shares.  The Series B Preferred Shares will rank senior to the Common Shares and any other class or series of shares of beneficial interest of the Trust ranking, as to dividends and upon Liquidation, junior to the Preferred Shares (collectively, “Junior Shares”).

(3)Dividends.  The holders of the then outstanding Series B Preferred Shares shall be entitled to receive, when and as declared by the Board of Trustees out of any funds legally available therefor, cumulative dividends at the rate of $22.8125 per share per year, payable in equal amounts of $5.703125 per share quarterly in cash on the fifteenth day, or if not a Business Day, the next succeeding Business Day, of January, April, July and October in each year, beginning January 15, 1996 (each such day being hereinafter called a “Quarterly Dividend Date” and each period ending on a Quarterly Dividend Date being hereinafter called a “Dividend Period”), to shareholders of record at the close of business on such date as shall be fixed by the Board of Trustees at the time of declaration of the dividend (the “Record Date”), which shall be not less than 10 nor more than 30 days preceding the Quarterly Dividend Date.  The amount of any dividend payable for the initial Dividend Period and for any other Dividend Period shorter than a full Dividend Period shall be prorated and computed on the basis of a 360-day year of twelve 30-day months.  Dividends on each share of Series B Preferred Shares shall accrue and be cumulative from and including the date of original issue thereof, whether or not (i) dividends on such shares are earned or declared or (ii) on any Quarterly Dividend Date there shall be funds legally available for the payment of dividends.  Dividends paid on the Series B Preferred Shares in an amount less than the total amount of such dividends at the time accrued and payable on such shares shall be allocated pro rata on a per share basis among all such shares at the time outstanding.

The amount of any dividends accrued on any Series B Preferred Shares at any Quarterly Dividend Date shall be the amount of any unpaid dividends accumulated thereon, to and including such Quarterly Dividend Date, whether or not earned or declared, and the amount of dividends accrued on any shares of Series B Preferred Shares at any date other than a Quarterly Dividend Date shall be equal to the sum of the amount of any unpaid dividends accumulated thereon, to and including the last preceding Quarterly Dividend Date, whether or not earned or declared, plus an amount calculated on the basis of the annual dividend rate of $22.8125 for the period after such last preceding Quarterly Dividend Date to and including the date as of which the calculation is made based on a 360-day year of twelve 30-day months.

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Except as provided in this Section 13.2, the Series B Preferred Shares shall not be entitled to participate in the earnings or assets of the Trust.

(4)Liquidation Rights.

(A)Upon the voluntary or involuntary dissolution, liquidation or winding up of the Trust, the holders of the Series B Preferred Shares then outstanding shall be entitled to receive and to be paid out of the assets of the Trust available for distribution to its shareholders, before any payment or distribution shall be made on any Junior Shares, the amount of $250.00 per Series B Preferred Share, plus accrued and unpaid dividends thereon.

(B)After the payment to the holders of the Series B Preferred Shares of the full preferential amounts provided for in this paragraph (b), the holders of the Series B Preferred Shares as such shall have no right or claim to any of the remaining assets of the Trust.

(C)If, upon any voluntary or involuntary dissolution, liquidation, or winding up of the Trust, the amounts payable with respect to the preference value of the Series B Preferred Shares and any other shares of beneficial interest of the Trust ranking as to any such distribution on a parity with the Series B Preferred Shares are not paid in full, the holders of the Series B Preferred Shares and of such other shares will share ratably in any such distribution of assets of the Trust in proportion to the full respective preference amounts to which they are entitled.

(D)Neither the sale of all or substantially all the property or business of the Trust, nor the merger or consolidation of the Trust into or with any other entity or the merger or consolidation of any other entity into or with the Trust, shall be deemed to be a dissolution, Liquidation or winding up, voluntary or involuntary, for the purposes of this paragraph (b).

(5)Redemption.

(A)Optional Redemption.  On and after October 15, 2005, the Trust may, at its option, redeem at any time all or, from time to time, part of the Series B Preferred Shares at a price per share (the “Series B Redemption Price”), payable in cash, of $250.00 per Series B Preferred Share, together with all

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accrued and unpaid dividends to and including the date fixed for redemption (the “Series B Redemption Date”).

(B)Procedures for Redemption.

(i)Notice of any redemption will be mailed by the Trust, postage prepaid, not less than 30 nor more than 60 days prior to the Series B Redemption Date, addressed to the holders of record of the Series B Preferred Shares to be redeemed at their addresses as they appear on the share transfer records of the Trust.  No failure to give such notice or any defect therein or in the mailing thereof shall affect the validity of the proceedings for the redemption of any Series B Preferred Shares except as to the holder to whom the Trust has failed to give notice or except as to the holder to whom notice was defective.  In addition to any information required by law or by the applicable rules of any exchange upon which Series B Preferred Shares may be listed or admitted to trading, such notice shall state: (a) the Series B Redemption Date; (b) the Series B Redemption Price; (c) the number of Series B Preferred Shares to be redeemed; (d) the place or places where certificates for such shares are to be surrendered for payment of the Series B Redemption Price; (e) that dividends on the shares to be redeemed will cease to accumulate on the Series B Redemption Date; and (f) the date on which conversion rights shall expire, the conversion price and the place or places where certificates for such shares are to be surrendered for conversion.

(ii)If notice has been mailed in accordance with Section 13.2(b)(5)(B)(i) above and provided that on or before the Series B Redemption Date specified in such notice all funds necessary for such redemption shall have been irrevocably set aside by the Trust, separate and apart from its other funds in trust for the pro rata benefit of the holders of the Series B Preferred Shares so called for redemption, so as to be, and to continue to be available therefor, then, from and after the Series B Redemption Date, dividends on the Series B Preferred Shares so called for redemption shall cease to accumulate, and said shares shall no longer be deemed to be outstanding and shall not have the status of Series B Preferred Shares and all rights of the holders thereof as shareholders of the Trust (except the right to receive the Series B Redemption Price) shall cease.  Upon surrender, in accordance with said notice, of the certificates for any Series B Preferred Shares so redeemed (properly endorsed or assigned for transfer, if the Trust shall so require and the notice shall so state), such Series B Preferred Shares shall be redeemed by the Trust at the Series B Redemption Price.  In case fewer than all the Series B Preferred Shares represented by any such certificate are redeemed, a new certificate or certificates shall be

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issued representing the unredeemed Series B Preferred Shares without cost to the holder thereof.

(iii)Any funds deposited with a bank or trust company for the purpose of redeeming Series B Preferred Shares shall be irrevocable except that:

(a)the Trust shall be entitled to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and the holders of any shares redeemed shall have no claim to such interest or other earnings; and

(b)any balance of monies so deposited by the Trust and unclaimed by the holders of the Series B Preferred Shares entitled thereto at the expiration of two years from the applicable Series B Redemption Date shall be repaid, together with any interest or other earnings earned thereon, to the Trust, and after any such repayment, the holders of the shares entitled to the funds so repaid to the Trust shall look only to the Trust for payment without interest or other earnings.

(iv)No Series B Preferred Shares may be redeemed except with funds legally available for the payment of the Series B Redemption Price.

(v)Unless full accumulated dividends on all Series B Preferred Shares shall have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past Dividend Periods and the then current Dividend Period, no Series B Preferred Shares shall be redeemed (unless all outstanding Series B Preferred Shares are simultaneously redeemed) or purchased or otherwise acquired directly or indirectly (except by conversion into or exchange for capital shares of the Trust ranking junior to the Series B Preferred Shares as to dividends and upon liquidation); provided, however, that the foregoing shall not prevent the redemption of Series B Preferred Shares pursuant to Article VII of this Declaration of Trust or the purchase or acquisition of Series B Preferred Shares pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding shares of Series B Preferred Shares.

(vi)If the Series B Redemption Date is after a Record Date and before the related Quarterly Dividend Date, the dividend payable on such Quarterly Dividend Date shall be paid to the holder

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in whose name the Series B Preferred Shares to be redeemed are registered at the close of business on such Record Date notwithstanding the redemption thereof between such Record Date and the related Quarterly Dividend Date or the Trust’s default in the payment of the dividend due.

(vii)In case of redemption of less than all Series B Preferred Shares at the time outstanding, the Series B Preferred Shares to be redeemed shall be selected pro rata from the holders of record of such shares in proportion to the number of Series B Preferred Shares held by such holders (with adjustments to avoid redemption of fractional shares) or by any other equitable method determined by the Trust.

(6)Voting Rights.  Except as required by law, the holders of the Series B Preferred Shares shall not be entitled to vote at any meeting of the shareholders for election of trustees or for any other purpose or otherwise to participate in any action taken by the Trust or the shareholders thereof, or to receive notice of any meeting of shareholders.

(A)In any matter in which the Series B Preferred Shares are entitled to vote (as expressly provided herein or as may be required by law), including any action by written consent, each Series B Preferred Share shall be entitled to 10 votes, each of which 10 votes may be directed separately by the holder thereof (or by any proxy or proxies of such holder).  With respect to each Series B Preferred Share, the holder thereof may designate up to 10 proxies, with each such proxy having the right to vote a whole number of votes (totaling 10 votes per Series B Preferred Share).

(B)Whenever dividends on any Series B Preferred Shares shall be in arrears for six or more quarterly periods, the holders of the Depositary Shares representing such Series B Preferred Shares (voting separately as a class with all other series of Preferred Shares upon which like voting rights have been conferred and are exercisable) will be entitled to vote for the election of two additional Trustees of the Trust at a special meeting called by the holders of record of at least ten percent (10%) of any series of Preferred Shares so in arrears (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the shareholders) or at the next annual meeting of shareholders, and at each subsequent annual meeting until all dividends accumulated on such Series B Preferred Shares for the past dividend periods and the then current dividend period shall have been fully paid or declared and a sum sufficient for the payment thereof set aside for payment.  In such case, the entire Board of Trustees of the Trust will be increased by two Trustees.

(C)So long as any Series B Preferred Shares remain outstanding, the Trust will not, without the affirmative vote or consent of the holders of at least two-thirds of the Series B Preferred Shares outstanding at the time,

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given in person or by proxy, either in writing or at a meeting (such series voting separately as a class), (i) authorize or create, or increase the authorized or issued amount of, any class or series of shares of beneficial interest ranking prior to the Series B Preferred Shares with respect to the payment of dividends or the distribution of assets upon liquidation, dissolution or winding up or reclassify any authorized shares of beneficial interest of the Trust into such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or (ii) amend, alter or repeal the provisions of this Declaration of Trust, whether by merger, consolidation or otherwise (an “Event”), so as to materially and adversely affect any right, preference, privilege or voting power of the Series B Preferred Shares or the holders thereof; provided, however, with respect to the occurrence of any of the Events set forth in (ii) above, so long as the Series B Preferred Shares remain outstanding with the terms thereof materially unchanged, taking into account that upon the occurrence of an Event, the Trust may not be the surviving entity, the occurrence of any such Event shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting power of holders of Series B Preferred Shares and provided further that (x) any increase in the amount of the authorized Preferred Shares or the creation of issuance of any other Series B Preferred Shares, or (y) any increase in the amount of authorized the Series B Preferred Shares or any other Preferred Shares, in each case ranking on a parity with or junior to the Series B Preferred Shares with respect to payment of dividends or the distribution of assets upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting powers.

The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding Series B Preferred Shares shall have been redeemed or called for redemption and sufficient funds shall have been deposited in trust to effect such redemption.

(7)Conversion.  The Series B Preferred Shares are not convertible into or exchangeable for any other property or securities of the Trust.

(8)Exclusion of Other Rights.

Except as may otherwise be required by law, the Series B Preferred Shares shall not have any voting powers, preferences and relative, participating, optional or other special rights, other than those specifically set forth in this Section 13.2.  The Series B Preferred Shares shall have no preemptive or subscription rights.

(9)Headings of Subdivisions.

The headings of the various subdivisions within this Section 13.2 are for convenience of reference only and shall not affect the interpretation of any of the provisions hereof.

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(10)Severability of Provisions.

If any voting powers, preferences and relative, participating, optional and other special rights of the Series B Preferred Shares and qualifications, limitations and restrictions thereof set forth in this Section 13.2 is invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, all other voting powers, preferences and relative, participating, optional and other special rights of Series B Preferred Shares and qualifications, limitations and restrictions thereof set forth in this Section 13.2 which can be given effect without the invalid, unlawful or unenforceable voting powers, preferences and relative, participating, optional and other special rights of Series B Preferred Shares and qualifications, limitations and restrictions thereof herein set forth, shall nevertheless, remain in full force and effect and no preferences or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of the Series B Preferred Shares herein set forth shall be deemed dependent upon any other such voting powers, preferences and relative, participating, optional or other special right of Series B Preferred Shares and qualifications, limitations and restrictions there of unless so expressed herein.

(c)Article VII of the Trust’s Declaration of Trust shall be supplemented by adding the following new section 7.24.

7.24Special Rules for Series B Preferred Shares.

(1)Certain Definitions.

For purposes of this Section 7.24 the following terms shall have the following meanings:

“Closing Date of the Series B Preferred Shares Offering” shall mean the time and date of payment for and delivery of Series B Preferred Shares issued pursuant to the effective registration statement for such Series B Preferred Shares filed under the Securities Act of 1933, as amended.

“Special Triggering Event” shall mean either (i) the redemption or purchase by the Trust of all or a portion of the outstanding shares of beneficial interest in the Trust, or (ii) a change in the value of the Series B Preferred Shares relative to any other class of beneficial interest in the Trust.

(2)Special Triggering Event.  If during the period commencing on the Closing Date of the Series B Preferred Shares Offering and prior to the date on which the Board of Trustees determines that it is no longer in the best interest of the Trust to attempt to, or continue to, qualify as a REIT, a Special Triggering Event (if effective) or other event or occurrence (if effective) would result in any violation of Section 7.2(a) of the Trust’s Declaration of Trust (or would result in the Trust being “closely held” within the meaning of Section 856(h) of the Code or would otherwise cause the Trust to fail to qualify as a

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REIT), then (i) the number of Series B Preferred Shares (rounded up to the nearest whole share) that would (but for this Section 7.24) cause any Person to directly or indirectly own either Series B Preferred Shares, or to directly or indirectly own Series B Preferred Shares and any other shares of beneficial interest in the Trust, in violation of Section 7.2(a)  (or would result in the Trust being “closely held” or otherwise fail to qualify as a REIT) shall constitute “Excess Shares” and shall be treated as provided in Article VII.  Such designation and treatment shall be effective as of the close of business on the business day prior to the date of the Special Triggering Event or other event or occurrence.

SECTION 13.3Series C Preferred Shares.  Pursuant to Section 5.4 of this Declaration, a series of preferred shares of beneficial interest designated 9¹/₈% Series C Cumulative Redeemable Preferred Shares of Beneficial Interest ($0.01 Par Value Per Share) (Liquidation Preference $250.00 Per Share) (the “Series C Preferred Shares”) is hereby established on the following terms:

(a)Certain Definitions.

Unless the context otherwise requires, the terms defined in this Section 13.3 shall have the meanings herein specified (with terms defined in the singular having comparable meanings when used in the plural).

“Business Day” shall mean any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in New York City are authorized or required by law, regulation or executive order to close.

“Common Shares” shall mean the common shares of beneficial interest, $.01 par value per share, of the Trust.

“Distribution Period” shall have the meaning set forth in Section 13.3(b)(3).

“Junior Shares” shall have the meaning set forth in Section 13.3(b)(2).

“Person” shall mean an individual, corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code, joint stock company or other entity, and also includes a group as that term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended; but does not include an underwriter which participates in a public offering of the Series C Preferred Shares provided that the ownership of Series C Preferred Shares by such Underwriter would not result in the Trust being “closely held” within the meaning of Section 856(h) of the Code, or would otherwise result in the Trust failing to qualify as a REIT.

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“Preferred Shares” shall mean preferred shares of beneficial interest, $.01 par value per share, including Series A Preferred Shares, Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares, Series E Preferred Shares, and Series F Preferred Shares.

“Quarterly Distribution Date” shall have the meaning set forth in Section 13.3(b)(3) below.

“Record Date” shall have the meaning set forth in Section 13.3(b)(3) below.

“REIT” shall mean a Real Estate Investment Trust under Section 856 of the Code.

“Series C Redemption Date” shall have the meaning set forth in Section 13.3(b)(5) below.

“Series C Redemption Price” shall have the meaning set forth in Section 13.3(b)(5) below.

(b)Series C Preferred Shares.

(1)Number.  The maximum number of shares of the Series C Preferred Shares shall be 460,000.

(2)Relative Seniority.  In respect of rights to receive distributions and to participate in distributions or payments in the event of any Liquidation, dissolution or winding up of the Trust, the Series C Preferred Shares shall rank pari passu with any other preferred shares of beneficial interest of the Trust, including the Series A Preferred Shares, Series B Preferred Shares, Series D Preferred Shares, Series E Preferred Shares and Series F Preferred Shares.  The Series C Preferred Shares will rank senior to the Common Shares and any other class or series of shares of beneficial interest of the Trust ranking, as to distributions and upon Liquidation, junior (collectively, the “Junior Shares”) to the Preferred Shares.

(3)Distributions.  The holders of the then outstanding Series C Preferred Shares shall be entitled to receive, when and as declared by the Board of Trustees out of any funds legally available therefor, cumulative distributions at the rate of $22.8125 per share per year, payable in equal amounts of $5.703125 per share quarterly in cash on the fifteenth day, or if not a Business Day, the next succeeding Business Day, of January, April, July and October in each year, beginning October 15, 1996 (each such day being hereinafter called a “Quarterly Distribution Date” and each period ending on a Quarterly Distribution Date being hereinafter called a “Distribution Period”), to shareholders of record at the close of business on such date as shall be fixed by the Board of Trustees at the time of declaration of the distribution (the “Record Date”), which shall not be less than 10 nor more than 30 days preceding the Quarterly Distribution Date.  The amount of any distribution payable for the initial Distribution Period and for any other Distribution Period shorter than a full Distribution Period shall be prorated and computed on the basis of a 360-day year of twelve 30-day months.  Distributions on each share of Series C Preferred Shares shall accrue and be cumulative from and including the date of original issue thereof, whether or not (i)

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distributions on such shares are earned or declared or (ii) on any Quarterly Distribution Date there shall be funds legally available for the payment of distributions.  Distributions paid on the Series C Preferred Shares in an amount less than the total amount of such distributions at the time accrued and payable on such shares shall be allocated pro rata on a per share basis among all such shares at the time outstanding.

The amount of any distributions accrued on any Series C Preferred Shares at any quarterly Distribution Date shall be the amount of any unpaid distributions accumulated thereon, to and including such Quarterly Distribution Date, whether or not earned or declared, and the amount of distributions accrued on any shares of Series C Preferred Shares at any date other than a Quarterly Distribution Date shall be equal to the sum of the amount of any unpaid distributions accumulated thereon, to and including the last preceding Quarterly Distribution Date, whether or not earned or declared, plus an amount calculated on the basis of the annual distribution rate of $22.8125 for the period after such last preceding Quarterly Distribution Date to and including the date as of which the calculation is made based on a 360-day year of twelve 30-day months.

Except as provided in this Section 13.3, the Series C Preferred Shares shall not be entitled to participate in the earnings or assets of the Trust.

(4)Liquidation Rights.

(A)Upon the voluntary or involuntary dissolution, liquidation or winding up of the Trust, the holders of the Series C Preferred Shares then outstanding shall be entitled to receive and to be paid out of the assets of the Trust available for distribution to its shareholders, before any payment or distribution shall be made on any Junior Shares, the amount of $250.00 per Series C Preferred Share, plus accrued and unpaid distributions thereon.

(B)After the payment to the holders of the Series C Preferred Shares of the full preferential amounts provided for in this paragraph (b), the holders of the Series C Preferred Shares as such shall have no right or claim to any of the remaining assets of the Trust.

(C)If, upon any voluntary or involuntary dissolution, liquidation, or winding up of the Trust, the amounts payable with respect to the preference value of the Series C Preferred Shares and any other shares of beneficial interest of the Trust ranking as to any such distribution on a parity with the Series C Preferred Shares are not paid in full, the holders of the Series C Preferred Shares and of such other shares will share ratably in any such distribution of assets of the Trust in proportion to the full respective preference amounts to which they are entitled.

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(D)Neither the sale of all or substantially all the property or business of the Trust, nor the merger or consolidation of the Trust into or with any other entity or the merger or consolidation of any other entity into or with the Trust, shall be deemed to be a dissolution, Liquidation or winding up, voluntary or involuntary, for the purposes of this paragraph (b).

(5)Redemption.

(A)Optional Redemption.  On and after September 9, 2006, the Trust may, at its option, redeem at any time all or, from time to time, part of the Series C Preferred Shares at a price per share (the “Series C Redemption Price”), payable in cash, of $250.00 per Series C Preferred Share, together with all accrued and unpaid distributions to and including the date fixed for redemption (the “Series C Redemption Date”).

(B)Procedures for Redemption.

(i)Notice of any redemption will be mailed by the Trust, postage prepaid, not less than 30 nor more than 60 days prior to the Series C Redemption Date, addressed to the holders of record of the Series C Preferred Shares to be redeemed at their addresses as they appear on the share transfer records of the Trust.  No failure to give such notice or any defect therein or in the mailing thereof shall affect the validity of the proceedings for the redemption of any Series C Preferred Shares except as to the holder to whom the Trust has failed to give notice or except as to the holder to whom notice was defective.  In addition to any information required by law or by the applicable rules of any exchange upon which Series C Preferred Shares may be listed or admitted to trading, such notice shall state: (a) the Series C Redemption Date; (b) the Series C Redemption Price; (c) the number of Series C Preferred Shares to be redeemed; (d) the place or places where certificates for such shares are to be surrendered for payment of the Series C Redemption Price; and (e) that distributions on the shares to be redeemed will cease to accumulate on the Series C Redemption Date.

(ii)  If notice has been mailed in accordance with Section 13.3(b)(5)(B)(i) above and provided that on or before the Series C Redemption Date specified in such notice all funds necessary for such redemption shall have been irrevocably set aside by the Trust, separate and apart from its other funds in trust for the pro rata benefit of the holders of the Series C

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Preferred Shares so called for redemption, so as to be, and to continue to be available therefor, then, from and after the Series C Redemption Date, dividends on the Series C Preferred Shares so called for redemption shall cease to accumulate, and said shares shall no longer be deemed to be outstanding and shall not have the status of Series C Preferred Shares and all rights of the holders thereof as shareholders of the Trust (except the right to receive the Series C Redemption Price) shall cease.  Upon surrender, in accordance with said notice, of the certificates for any Series C Preferred Shares so redeemed (properly endorsed or assigned for transfer, if the Trust shall so require and the notice shall so state), such Series C Preferred Shares shall be redeemed by the Trust at the Series C Redemption Price.  In case fewer than all the Series C Preferred Shares represented by any such certificate are redeemed, a new certificate or certificates shall be issued representing the unredeemed Series C Preferred Shares without cost to the holder thereof.

(iii)  Any funds deposited with a bank or trust company for the purpose of redeeming Series C Preferred Shares shall be irrevocable except that:

(a)the Trust shall be entitled to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and the holders of any shares redeemed shall have no claim to such interest or other earnings; and

(b)any balance of monies so deposited by the Trust and unclaimed by the holders of the Series C Preferred Shares entitled thereto at the expiration of two years from the applicable Series C Redemption Date shall be repaid, together with any interest or other earnings earned thereon, to the Trust, and after any such repayment, the holders of the shares entitled to the funds so repaid to the Trust shall look only to the Trust for payment without interest or other earnings.

(iv)  No Series C Preferred Shares may be redeemed except with funds legally available for the payment of the Series C Redemption Price.

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(v)  Unless full accumulated dividends on all Series C Preferred Shares shall have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past Dividend Periods and the then current Dividend Period, no Series C Preferred Shares shall be redeemed (unless all outstanding Series C Preferred Shares are simultaneously redeemed) or purchased or otherwise acquired directly or indirectly (except by conversion into or exchange for capital shares of the Trust ranking junior to the Series C Preferred Shares as to dividends and upon liquidation); provided, however, that the foregoing shall not prevent the redemption of Series C Preferred Shares pursuant to Article VII of the Declaration of Trust or the purchase or acquisition of Series C Preferred Shares pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding shares of Series C Preferred Shares.

(vi)  If the Series C Redemption Date is after a Record Date and before the related Quarterly Distribution Date, the distribution payable on such Quarterly Distribution Date shall be paid to the holder in whose name the Series C Preferred Shares to be redeemed are registered at the close of business on such Record Date notwithstanding the redemption thereof between such Record Date and the related Quarterly Distribution Date or the Trust’s default in the payment of the distribution due.

(vii)  In case of redemption of less than all Series C Preferred Shares at the time outstanding, the Series C Preferred Shares to be redeemed shall be selected pro rata from the holders of record of such shares in proportion to the number of Series C Preferred Shares held by such holders (with adjustments to avoid redemption of fractional shares) or by any other equitable method determined by the Trust.

(6)Voting Rights.  Except as required by law, the holders of the Series C Preferred Shares shall not be entitled to vote at any meeting of the shareholders for election of trustees or for any other purpose or otherwise to participate in any action taken by the Trust or the shareholders thereof, or to receive notice of any meeting of shareholders.

(A)In any matter in which the Series C Preferred Shares are entitled to vote (as expressly provided herein or as may be required by law), including any action by written consent, each Series C Preferred Share shall be entitled to 10 votes, each of which 10 votes may be directed separately by the holder thereof (or by any proxy or proxies of such holder).  With respect to each Series C Preferred Share, the holder

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thereof may designate up to 10 proxies, with each such proxy having the right to vote a whole number of votes (totaling 10 votes per Series C Preferred Share).

(B)Whenever distributions on any Series C Preferred Shares shall be in arrears for six or more quarterly periods, the holders of the Depositary Shares representing such Series C Preferred Shares, voting separately as a class with all other series of Preferred Shares upon which like voting rights have been conferred and are exercisable, will be entitled to vote for the election of two additional Trustees of the Trust at a special meeting called by the holders of record of at least ten percent (10%) of any series of Preferred Shares so in arrears (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the shareholders) or at the next annual meeting of shareholders, and at each subsequent annual meeting until all distributions accumulated on such Series C Preferred Shares for the past distribution periods and the then current distribution period shall have been fully paid or declared and a sum sufficient for the payment thereof set aside for payment.  In such case, the entire Board of Trustees of the Trust will be increased by two Trustees.

(C)So long as any Series C Preferred Shares remain outstanding, the Trust will not, without the affirmative vote or consent of the holders of at least two-thirds of the Series C Preferred Shares outstanding at the time, given in person or by proxy, either in writing or at a meeting (such series voting separately as a class), (i) authorize or create, or increase the authorized or issued amount of, any class or series of shares of beneficial interest ranking prior to the Series C Preferred Shares with respect to the payment of distributions or the distribution of assets upon liquidation, dissolution or winding up or reclassify any authorized shares of beneficial interest of the Trust into such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or (ii) amend, alter or repeal the provisions of this Declaration of Trust whether by merger, consolidation or otherwise (an “Event”), so as to materially and adversely affect any right, preference, privilege or voting power of the Series C Preferred Shares or the holders thereof; provided, however, with respect to the occurrence of any of the Events set forth in (ii) above, so long as the Series C Preferred Shares remain outstanding with the terms thereof materially unchanged, taking into account that upon the occurrence of an Event, the Trust may not be the surviving

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entity, the occurrence of any such Event shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting power of holders of Series C Preferred Shares and provided further that (x) any increase in the amount of the authorized Preferred Shares or the creation or issuance of any other Series C Preferred Shares, or (y) any increase in the amount of authorized Series C Preferred Shares or any other Preferred Shares, in each case ranking on a parity with or junior to the Series C Preferred Shares with respect to payment of distributions or the distribution of assets upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting powers.

The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding Series C Preferred Shares shall have been redeemed or called for redemption and sufficient funds shall have been deposited in trust to effect such redemption.

(7)Conversion.  The Series C Preferred Shares are not convertible into or exchangeable for any other property or securities of the Trust.

(8)Exclusion of Other Rights.

Except as may otherwise be required by law, the Series C Preferred Shares shall not have any voting powers, preferences and relative, participating, optional or other special rights, other than those specifically set forth in this Section 13.3.  The Series C Preferred Shares shall have no preemptive or subscription rights.

(9)Headings of Subdivisions.

The headings of the various subdivisions within this Section 13.3 are for convenience of reference only and shall not affect the interpretation of any of the provisions hereof.

(10)Severability of Provisions.

If any voting powers, preferences and relative, participating, optional and other special rights of the Series C Preferred Shares and qualifications, limitations and restrictions thereof set forth in this Section 13.3 is invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, all other voting powers, preferences and relative, participating, optional and other special rights of Series C Preferred Shares and qualifications, limitations and restrictions thereof set forth in this Section 13.3 which can be given effect without the invalid, unlawful or unenforceable voting powers, preferences and relative, participating, optional and other special rights of Series C Preferred Shares and qualifications, limitations and restrictions thereof herein set forth, shall nevertheless, remain in full force and effect and no preferences or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of the Series C Preferred Shares herein set forth shall be

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deemed dependent upon any other such voting powers, preferences and relative, participating, optional or other special right of Series C Preferred Shares and qualifications, limitations and restrictions thereof unless so expressed herein.

(c)Article VII of the Trust’s Declaration of Trust shall be supplemented by adding the following new Section 7.25.

7.25Special Rules for Series C Preferred Shares.

(1)Certain Definitions.

For purposes of this Section 7.25 the following terms shall have the following meanings:

“Closing Date of the Series C Preferred Shares Offering” shall mean the time and date of payment for and delivery of Series C Preferred Shares issued pursuant to the effective registration statement for such Series C Preferred Shares filed under the Securities Act of 1933, as amended.

“Special Triggering Event” shall mean either (i) the redemption or purchase by the Trust of all or a portion of the outstanding shares of beneficial interest in the Trust, or (ii) a change in the value of the Series C Preferred Shares relative to any other class of beneficial interest in the Trust.

(2)Special Triggering Event.  If during the period commencing on the Closing Date of the Series C Preferred Shares Offering and prior to the date on which the Board of Trustees determines that it is no longer in the best interest of the Trust to attempt to, or continue to, qualify as a REIT, a Special Triggering Event (if effective) or other event or occurrence (if effective) would result in any violation of Section 7.2(a) of the Trust’s Declaration of Trust (or would result in the Trust being “closely held” within the meaning of Section 856(h) of the Code or would otherwise cause the Trust to fail to qualify as a REIT), then (i) the number of Series C Preferred Shares (rounded up to the nearest whole share) that would (but for this Section 7.25) cause any Person to directly or indirectly own either Series C Preferred Shares, or to directly or indirectly own Series C Preferred Shares and any other shares of beneficial interest in the Trust, in violation of Section 7.2(a) (or would result in the Trust being “closely held” or otherwise fail to qualify as a REIT) shall constitute “Excess Shares” and shall be treated as provided in Article VII.  Such designation and treatment shall be effective as of the close of business on the business day prior to the date of the Special Triggering Event or other event or occurrence.

SECTION 13.4.Series D Preferred Shares.  Pursuant to Section 5.4 of this Declaration, a series of preferred shares of beneficial interest designated 8.60% Series D Cumulative Redeemable Preferred Shares of Beneficial Interest (Liquidation Preference $250.00 Per Share) (the “Series D Preferred Shares”) is hereby established on the following terms:

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(a)Certain Definitions.

Unless the context otherwise requires, the terms defined in this subparagraph (a) shall have, for all purposes of this Section 13.4, the meanings herein specified (with terms defined in the singular having comparable meanings when used in the plural).

“Business Day” shall mean any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in New York City are authorized or required by law, regulation or executive order to close.

“Common Shares” shall mean the common shares of beneficial interest, $.01 par value per share, of the Trust.

“Distribution Period” shall have the meaning set forth in Section 13.4(b)(3).

“Junior Shares” shall have the meaning set forth in Section 13.4(b)(2).

“Person” shall mean an individual, corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code, joint stock company or other entity, and also includes a group as that term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended; but does not include an underwriter which participates in a public offering of the Series D Preferred Shares provided that the ownership of Series D Preferred Shares by such Underwriter would not result in the Trust being “closely held” within the meaning of Section 856(h) of the Code, or would otherwise result in the Trust failing to qualify as a REIT.

“Preferred Shares” shall mean preferred shares of beneficial interest, including Series A Preferred Shares, Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares, Series E Preferred Shares and Series F Preferred Shares.

“Quarterly Distribution Date” shall have the meaning set forth in Section 13.4(b)(3).

“Record Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“REIT” shall mean a Real Estate Investment Trust under Section 856 of the Code.

“Series D Redemption Date” shall have the meaning set forth in Section 13.4(b)(5).

“Series D Redemption Price” shall have the meaning set forth in Section 13.4(b)(5).

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(b)Series D Preferred Shares

(1)Number.  The maximum number of shares of the Series D Preferred Shares shall be 805,000.

(2)Relative Seniority.  In respect of rights to receive distributions and to participate in distributions or payments in the event of any Liquidation, dissolution or winding up of the Trust, the Series D Preferred Shares shall rank pari passu with any other preferred shares of beneficial interest of the Trust, including the Series A Preferred Shares, Series B Preferred Shares, Series C Preferred Shares, Series E Preferred Shares, and Series F Preferred Shares, and will rank senior to the Common Shares and any other class or series of shares of beneficial interest of the Trust ranking, as to distributions and upon Liquidation, junior (collectively, the “Junior Shares”) to the Preferred Shares.

(3)Distributions.  The holders of the then outstanding Series D Preferred Shares shall be entitled to receive, when and as declared by the Board of Trustees out of any funds legally available therefor, cumulative distributions at the rate of $2.15 per share per year, payable in equal amounts of $.5375 per share quarterly in cash on the fifteenth day, or if not a Business Day, the next succeeding Business Day, of January, April, July and October in each year, beginning July 15, 1997 (each such day being hereinafter called a “Quarterly Distribution Date” and each period ending on a Quarterly Distribution Date being hereinafter called a “Distribution Period”), to shareholders of record at the close of business on such date as shall be fixed by the Board of Trustees at the time of declaration of the distribution (the “Record Date”), which shall not be less than 10 nor more than 30 days preceding the Quarterly Distribution Date.  The amount of any distribution payable for the initial Distribution Period and for any other Distribution Period shorter than a full Distribution Period shall be prorated and computed on the basis of a 360-day year of twelve 30-day months.  Distributions on each share of Series D Preferred Shares shall accrue and be cumulative from and including the date of original issue thereof, whether or not (i) distributions on such shares are earned or declared or (ii) on any Quarterly Distribution Date there shall be funds legally available for the payment of distributions.  Distributions paid on the Series D Preferred Shares in an amount less than the total amount of such distributions at the time accrued and payable on such shares shall be allocated pro rata on a per share basis among all such shares at the time outstanding.

The amount of any distributions accrued on any Series D Preferred Shares at any quarterly Distribution Date shall be the amount of any unpaid distributions accumulated thereon, to and including such Quarterly Distribution Date, whether or not earned or declared, and the amount of distributions accrued on any Series D Preferred Shares at any date other than a Quarterly Distribution Date shall be equal to the sum of the amount of any unpaid distributions accumulated thereon, to and including the last preceding Quarterly Distribution Date, whether or not earned or declared, plus an amount calculated on the basis of the annual distribution rate of $2.15 for the period after such last preceding Quarterly Distribution Date to and including the date as of which the calculation is made based on a 360-day year of twelve 30-day months.

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Except as provided in these Articles, the Series D Preferred Shares shall not be entitled to participate in the earnings or assets of the Trust.

(4)Liquidation Rights.

(A)Upon the voluntary or involuntary dissolution, liquidation or winding up of the Trust, the holders of the Series D Preferred Shares then outstanding shall be entitled to receive and to be paid out of the assets of the Trust available for distribution to its shareholders, before any payment or distribution shall be made on any Junior Shares, the amount of $250.00 per Series D Preferred Share, plus accrued and unpaid distributions thereon.

(B)After the payment to the holders of the Series D Preferred Shares of the full preferential amounts provided for in this paragraph (b), the holders of the Series D Preferred Shares as such shall have no right or claim to any of the remaining assets of the Trust.

(C)If, upon any voluntary or involuntary dissolution, liquidation, or winding up of the Trust, the amounts payable with respect to the preference value of the Series D Preferred Shares and any other shares of beneficial interest of the Trust ranking as to any such distribution on a parity with the Series D Preferred Shares are not paid in full, the holders of the Series D Preferred Shares and of such other shares will share ratably in any such distribution of assets of the Trust in proportion to the full respective preference amounts to which they are entitled.

(D)Neither the sale of all or substantially all the property or business of the Trust, nor the merger or consolidation of the Trust into or with any other entity or the merger or consolidation of any other entity into or with the Trust, shall be deemed to be a dissolution, Liquidation or winding up, voluntary or involuntary, for the purposes of this paragraph (b).

(5)Redemption.

(A)Optional Redemption.  On and after June 1, 2007, the Trust may, at its option, redeem at any time all or, from time to time, part of the Series D Preferred Shares at a price per share (the “Series D Redemption Price”), payable in cash, of $250.00 per Series D Preferred Share, together with all

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accrued and unpaid distributions to and including the date fixed for redemption (the “Series D Redemption Date”).

(B)Procedures for Redemption.

(i)Notice of any redemption will be mailed by the Trust, postage prepaid, not less than 30 nor more than 60 days prior to the Series D Redemption Date, addressed to the holders of record of the Series D Preferred Shares to be redeemed at their addresses as they appear on the share transfer records of the Trust.  No failure to give such notice or any defect therein or in the mailing thereof shall affect the validity of the proceedings for the redemption of any Series D Preferred Shares except as to the holder to whom the Trust has failed to give notice or except as to the holder to whom notice was defective.  In addition to any information required by law or by the applicable rules of any exchange upon which Series D Preferred Shares may be listed or admitted to trading, such notice shall state: (a) the Series D Redemption Date; (b) the Series D Redemption Price; (c) the number of Series D Preferred Shares to be redeemed; (d) the place or places where certificates for such shares are to be surrendered for payment of the Series D Redemption Price; and (e) that distributions on the shares to be redeemed will cease to accumulate on the Series D Redemption Date.

(ii)If notice has been mailed in accordance with subparagraph 13 .4(b)(5)(B)(i) above and provided that on or before the Series D Redemption Date specified in such notice all funds necessary for such redemption shall have been irrevocably set aside by the Trust, separate and apart from its other funds in trust for the pro rata benefit of the holders of the Series D Preferred Shares so called for redemption, so as to be, and to continue to be available therefor, then, from and after the Series D Redemption Date, distributions on the Series D Preferred Shares so called for redemption shall cease to accumulate, and said shares shall no longer be deemed to be outstanding and shall not have the status of Series D Preferred Shares and all rights of the holders thereof as shareholders of the Trust (except the right to receive the Series D Redemption Price) shall cease.  Upon surrender, in accordance with said notice, of the certificates for any Series D Preferred Shares so redeemed (properly endorsed or assigned for transfer, if the Trust shall so require and the notice shall so state), such Series D Preferred Shares shall be redeemed by the Trust at the Series D Redemption Price.  In case fewer than all the Series D Preferred Shares represented

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by any such certificate are redeemed, a new certificate or certificates shall be issued representing the unredeemed Series D Preferred Shares without cost to the holder thereof.

(iii)Any funds deposited with a bank or trust company for the purpose of redeeming Series D Preferred Shares shall be irrevocable except that:

(a)the Trust shall be entitled to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and the holders of any shares redeemed shall have no claim to such interest or other earnings; and

(b)any balance of monies so deposited by the Trust and unclaimed by the holders of the Series D Preferred Shares entitled thereto at the expiration of two years from the applicable Series D Redemption Date shall be repaid, together with any interest or other earnings earned thereon, to the Trust, and after any such repayment, the holders of the shares entitled to the funds so repaid to the Trust shall look only to the Trust for payment without interest or other earnings.

(iv)No Series D Preferred Shares may be redeemed except with funds legally available for the payment of the Series D Redemption Price.

(v)Unless full accumulated distributions on all Series D Preferred Shares shall have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past Distribution Periods and the then current Distribution Period, no Series D Preferred Shares shall be redeemed (unless all outstanding Series D Preferred Shares are simultaneously redeemed) or purchased or otherwise acquired directly or indirectly (except by conversion into or exchange for capital shares of the Trust ranking junior to the Series D Preferred Shares as to distributions and upon liquidation); provided, however, that the foregoing shall not prevent the redemption of Series D Preferred Shares pursuant

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to Article VII of this Declaration of Trust or the purchase or acquisition of Series D Preferred Shares pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding shares of Series D Preferred Shares.

(vi)If the Series D Redemption Date is after a Record Date and before the related Quarterly Distribution Date, the distribution payable on such Quarterly Distribution Date shall be paid to the holder in whose name the Series D Preferred Shares to be redeemed are registered at the close of business on such Record Date notwithstanding the redemption thereof between such Record Date and the related Quarterly Distribution Date or the Trust’s default in the payment of the distribution due.

(vii)In case of redemption of less than all Series D Preferred Shares at the time outstanding, the Series D Preferred Shares to be redeemed shall be selected pro rata from the holders of record of such shares in proportion to the number of Series D Preferred Shares held by such holders (with adjustments to avoid redemption of fractional shares) or by any other equitable method determined by the Trust.

(6)Voting Rights.  Except as required by law, the holders of the Series D Preferred Shares shall not be entitled to vote at any meeting of the shareholders for election of trustees or for any other purposes or otherwise to participate in any action taken by the Trust or the shareholders thereof, or to receive notice of any meeting of shareholders.

(A)In any matter in which the Series D Preferred Shares are entitled to vote (as expressly provided herein or as may be required by law), including any action by written consent, each Series D Preferred Share shall be entitled to 10 votes, each of which 10 votes may be directed separately by the holder thereof (or by any proxy or proxies of such holder).  With respect to each Series D Preferred Share, the holder thereof may designate up to 10 proxies, with each such proxy having the right to vote a whole number of votes (totaling 10 votes per Series D Preferred Share).

(B)Whenever distributions on any Series D Preferred Shares shall be in arrears for six or more quarterly periods, the holders of the Depositary Shares representing such Series D Preferred Shares, voting separately as a class with all other series of Preferred Shares upon which like voting rights have been

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conferred and are exercisable, will be entitled to vote for the election of two additional Trustees of the Trust at a special meeting called by the holders of record of at least ten percent (10%) of any series of Preferred Shares so in arrears (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the shareholders) or at the next annual meeting of shareholders, and at each subsequent annual meeting until all distributions accumulated on such Series D Preferred Shares for the past distribution periods and the then current distribution period shall have been fully paid or declared and a sum sufficient for the payment thereof set aside for payment.  In such case, the entire Board of Trustees of the Trust will be increased by two Trustees.

(C)So long as any Series D Preferred Shares remain outstanding, the Trust will not, without the affirmative vote or consent of the holders of at least two-thirds of the Series D Preferred Shares outstanding at the time, given in person or by proxy, either in writing or at a meeting (such series voting separately as a class), (i) authorize or create, or increase the authorized or issued amount of, any class or series of shares of beneficial interest ranking prior to the Series D Preferred Shares with respect to the payment of distributions or the distribution of assets upon liquidation, dissolution or winding up or reclassify any authorized shares of beneficial interest of the Trust into such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or (ii) amend, alter or repeal the provisions of the Trust’s Declaration of Trust whether by merger, consolidation or otherwise (an “Event”), so as to materially and adversely affect any right, preference, privilege or voting power of the Series D Preferred Shares or the holders thereof; provided, however, with respect to the occurrence of any of the Events set forth in (ii) above, so long as the Series D Preferred Shares remain outstanding with the terms thereof materially unchanged, taking into account that upon the occurrence of an Event, the Trust may not be the surviving entity, the occurrence of any such Event shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting power of

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holders of Series D Preferred Shares and provided further that (x) any increase in the amount of the authorized Preferred Shares or the creation or issuance of any other Series D Preferred Shares, or (y) any increase in the amount of authorized Series D Preferred Shares or any other Preferred Shares, in each case ranking on a parity with or junior to the Series D Preferred Shares with respect to payment of distributions or the distribution of assets upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting powers.

The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding Series D Preferred Shares shall have been redeemed or called for redemption and sufficient funds shall have been deposited in trust to effect such redemption.

(7)Conversion.  The Series D Preferred Shares are not convertible into or exchangeable for any other property or securities of the Trust.

(8)Exclusion of Other Rights.

Except as may otherwise be required by law, the Series D Preferred Shares shall not have any voting powers, preferences and relative, participating, optional or other special rights, other than those specifically set forth in this Section 13.4 (as such Section may be amended from time to time) and in the Declaration of Trust.  The Series D Preferred Shares shall have no preemptive or subscription rights.

(9)Headings of Subdivisions.

The headings of the various subdivisions hereof are for convenience of reference only and shall not affect the interpretation of any of the provisions hereof.

(10)Severability of Provisions.

If any voting powers, preferences and relative, participating, optional and other special rights of the Series D Preferred Shares and qualifications, limitations and restrictions thereof set forth in this Section 13.4 (as this Section 13.4 may be amended from time to time) is invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, all other voting powers, preferences and relative, participating, optional and other special rights of Series D Preferred Shares and qualifications, limitations and restrictions thereof set forth in this Section 13.4 (as so amended) which can be given effect without the invalid, unlawful or unenforceable voting powers, preferences and relative, participating, optional or other special rights of Series D Preferred Shares and qualifications, limitations and restrictions thereof herein set forth, shall nevertheless, remain in full force and effect and no preferences or other rights, voting powers, restrictions,

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limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of the Series D Preferred Shares herein set forth shall be deemed dependent upon any other such voting powers, preferences and relative, participating, optional or other special right of Series D Preferred Shares and qualifications, limitations and restrictions thereof unless so expressed herein.

(c)Articles VII of the Trust’s Declaration of Trust shall be supplemented by adding the following new section 7.26.

7.26Special Rules for Series D Preferred Shares

(1)Certain Definitions.

For purposes of this section 7.26 the following terms shall have the following meanings:

“Closing Date of the Series D Preferred Shares Offering” shall mean the time and date of payment for and delivery of Series D Preferred Shares issued pursuant to the Trust’s effective registration statement for such Series D Preferred Shares filed under the Securities Act of 1933, as amended.

“Special Triggering Event” shall mean either (i) the redemption or purchase by the Trust of all or a portion of the outstanding shares of beneficial interest in the Trust, or (ii) a change in the value of the Series D Preferred Shares relative to any other class of beneficial interest in the Trust.

(2)Special Triggering Event.  If during the period commencing on the Closing Date of the Series D Preferred Shares Offering and prior to the Restriction Termination Date, a Special Triggering Event (if effective) or other event or occurrence (if effective) would result in any violation of section 7.2(a) of the Trust’s Declaration of Trust (or would result in the Trust being “closely held” within the meaning of Section 856(h) of the Code or would otherwise cause the Trust to fail to qualify as a REIT), then (i) the number of Series D Preferred Shares (rounded up to the nearest whole share) that would (but for this section 7.26) cause any Person to Beneficially Own either Series D Preferred Shares, or to Beneficially own Series D Preferred Shares and any other shares of beneficial interest in the Trust, in violation of section 7.2(a) (or would result in the Trust being “closely held” or otherwise fail to qualify as a REIT) shall constitute “Excess Shares” and shall be treated as provided in Article VII.  Such designation and treatment shall be effective as of the close of business on the Business Day prior to the date of the Special Triggering Event or other event or occurrence.

SECTION 13.5.Series E Preferred Shares.  Pursuant to Section 5.4 of this Declaration, a series of preferred shares of beneficial interest designated the “Series E Cumulative Convertible Preferred Shares of Beneficial Interest” (the “Series E Convertible Preferred Shares”) is hereby established on the following terms:

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1.Designation and Amount.  The shares of the series of preferred shares established hereunder shall be designated as Series E Convertible Preferred Shares and the authorized number of shares constituting such series shall be 4,600,000.  The par value of the Series E Convertible Preferred Shares shall be $.01 per share.

2.Distributions.

(a)The holders of shares of the Series E Convertible Preferred Shares will be entitled to receive, when, as and if authorized by the Board of Trustees out of assets of the Trust legally available therefor (and subject to the limitation described in the last sentence of this paragraph), cumulative cash distributions on the shares of the Series E Convertible Preferred Shares at the annual rate of $1.75 per share, payable quarterly on January 1, April 1, July 1 and October 1 of each year, commencing on January 1, 1994 (which initial partial distribution shall be from the date of issuance of the Series E Convertible Preferred Shares).  Such distributions shall be cumulative from the date of original issue of the Series E Convertible Preferred Shares.  If permissible under applicable law and provided the distributions will qualify for the dividends paid deduction (within the meaning of Sections 561 and 562 of the Internal Revenue Code of 1986 or any successor provisions thereto), such distributions shall be paid as follows: first, from income of the Trust other than net capital gains, and the balance, if any, from net capital gains of the Trust.  If the Board of Trustees determines, in its sole discretion, that distributions to be paid in accordance with the preceding sentence would not qualify for such dividends paid deduction, then such distributions shall be paid in a manner determined by the Board of Trustees.  Each distribution shall be paid to the holders of record of the Series E Convertible Preferred Shares as they appear on the share register of the Trust on such record date, not more than 90 days preceding the distribution payment date thereof, as shall be fixed by the Board of Trustees or a duly authorized committee thereof.  If a holder converts Series E Convertible Preferred Shares after the close of business on the record date for a distribution and before the opening of business on the payment date for such distribution, then, pursuant to Section 13.5(7) hereof, the holder will be required to pay to the Trust at the time of such conversion the amount of such distribution (unless the shares were converted after the issuance of a notice of redemption with respect to such shares, in which event the holder of such shares shall be entitled to the distribution payable thereon on such distribution payment date without making such payment).

(b)If any Convertible Preferred Shares are outstanding, no full distributions shall be declared or paid or set apart for payment on any other preferred shares of beneficial interest of the Trust ranking as to distributions on a parity with or junior to the Series E Convertible Preferred Shares for any period unless full cumulative distributions have been declared and paid or declared and a sum sufficient for the payment thereof has been set apart for such payment on the Series E Convertible Preferred Shares for all past distribution periods and the then current distribution period.  If distributions are not paid in full, or not declared in full and a sum sufficient for such full payment is not set apart for the payment thereof, upon the Series E Convertible Preferred Shares and any other preferred shares ranking on a parity as to distributions with the Series E Convertible Preferred Shares, all distributions declared upon Series E Convertible Preferred Shares and upon any other preferred shares ranking on a parity as to distributions shall be paid or declared pro rata so

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that in all cases the amount of distributions paid or declared per share on the Series E Convertible Preferred Shares and such other preferred shares shall bear to each other the same ratio that accumulated distributions per share, including distributions accrued or in arrears, if any, on the Series E Convertible Preferred Shares and such other preferred shares bear to each other.  Except as provided in the preceding sentence, unless full cumulative distributions on the Series E Convertible Preferred Shares have been paid or declared and a sum sufficient for such full payment set apart for payment for all past distribution periods and the then current distribution period, no distributions (other than distributions in shares of Common Shares (as hereinafter defined) or in any other shares of beneficial interest of the Trust ranking junior to the Series E Convertible Preferred Shares as to distribution rights and the liquidation preference) shall be declared or paid or set apart for payment or other distribution upon the Trust’s common shares of beneficial interest, par value $.01 per share (the “Common Shares”), or, except as provided above, on any other shares of beneficial interest of the Trust ranking junior to or on a parity with the Series E Convertible Preferred Shares as to distribution rights or the liquidation preference, nor shall any Common Shares or any other shares of beneficial interest of the Trust ranking junior to or on a parity with the Series E Convertible Preferred Shares as to distribution rights or the liquidation preference be redeemed, purchased or otherwise acquired for any consideration (or any payment made to or available for a sinking fund for the redemption of any such shares) by the Trust or any subsidiary of the Trust (except by conversion into or exchange for shares of beneficial interest of the Trust ranking junior to the Series E Convertible Preferred Shares as to distribution rights and the liquidation preference).  Holders of the Series E Convertible Preferred Shares shall not be entitled to any distributions, whether payable in cash, property or shares of beneficial interest, in excess of full accrued and cumulative distributions as herein provided.  No interest or sum of money in lieu of interest shall be payable in respect of any distribution payment or payments on the Series E Convertible Preferred Shares that may be in arrears.

The terms “accrued distributions,” “distributions accrued” and “distributions in arrears,” whenever used herein with reference to shares of preferred shares of beneficial interest, shall be deemed to mean an amount which shall be equal to distributions thereon at the annual distribution rates per share for the respective series thereof from the date or dates on which such distributions commence to accrue to the end of the then current quarterly distribution period for such preferred shares (or, in the case of redemption, to the date of redemption), less the amount of all distributions paid, or declared in full and set aside for the payment thereof, upon such shares of preferred shares.

(c)Distributions payable on the Series E Convertible Preferred Shares for any period less than a full quarterly distribution period shall be computed on the basis of a 360-day year of twelve 30-day months.  Quarterly distributions payable on the Series E Convertible Preferred Shares shall be computed by dividing the annual distribution rate by four.

3.Trustees’ Right to Refuse to Transfer Series E Convertible Preferred Shares; Limitation on Holdings.

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(a)The terms and provisions of this Section 13.5(3) shall apply in addition to, and not in limitation of, the terms and provisions of Article VII of this Declaration of Trust.

(b)Each Person (as defined in Section 1.5 of the Declaration of Trust) who owns directly or indirectly more than five percent in number or value of the total Series E Convertible Preferred Shares outstanding shall, within 30 days after January 1 of each year, give written notice to the Trust stating the Person’s name and address, the number of Series E Convertible Preferred Shares directly or indirectly owned by such Person, and a description of the capacity in which such Series E Convertible Preferred Shares are held.  For purposes of this Section 13.5, the number and value of the total Series E Convertible Preferred Shares outstanding shall be determined by the Board of Trustees in good faith, which determination shall be conclusive for all purposes hereunder.  In addition, each direct or indirect holder of Series E Convertible Preferred Shares, irrespective of such shareholder’s percentage ownership of outstanding Series E Convertible Preferred Shares, shall upon demand disclose to the Trust in writing such information with respect to the direct or indirect ownership of Series E Convertible Preferred Shares as the Board of Trustees deems necessary from time to time to enable the Board of Trustees to determine whether the Trust complies with the REIT Provisions of the Code (as defined in Section 1.5 of the Declaration of Trust), to comply with the requirements of any taxing authority or governmental agency or to determine any such compliance.

(c)If, in the opinion of the Board of Trustees, which shall be binding upon any prospective acquiror of Series E Convertible Preferred Shares, any proposed transfer or issuance would jeopardize the status of the Trust as a real estate investment trust under the REIT Provisions of the Code, the Board of Trustees shall have the right, but not the duty, to refuse to permit such transfer or issuance or refuse to give effect to such transfer or issuance and to take any action to void any such issuance or cause any such transfer not to occur.

(d)As a condition to any transfer and/or registration of transfer on the books of the Trust of any Series E Convertible Preferred Shares which could result in direct or indirect ownership (as hereinafter defined) of Series E Convertible Preferred Shares exceeding 20% of the lesser of the number or the value of the total Series E Convertible Preferred Shares outstanding (the “Excess Preferred Shares”) by a Person other than a Preferred Excepted Person (as defined in Section 3(e) below), such prospective transferee shall give written notice to the Trust of the proposed transfer and shall furnish such opinions of counsel, affidavits, undertakings, agreements and information as may be required by the Board of Trustees no later than the 15th day prior to any transfer which, if consummated, would result in such ownership.

(e)Any transfer of Series E Convertible Preferred Shares that would (i) create a direct or indirect owner of Excess Preferred Shares other than a Preferred Excepted Person; or (ii) result in the Trust being “closely held” within the meaning of Section 856(h) of the Code, shall be void ab initio and the prospective acquiror shall not be entitled to any rights afforded to owners of Series E Convertible Preferred Shares hereunder and shall be deemed never to have had an interest therein.  Any issuance of Series E

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Convertible Preferred Shares that would (i) create a direct or indirect owner of Excess Preferred Shares other than a Preferred Excepted Person; or (ii) result in the Trust being “closely held” within the meaning of Section 856(h) of the Code, shall be void ab initio and the prospective acquiror shall not be entitled to any rights afforded to owners of Series E Convertible Preferred Shares hereunder and shall be deemed never to have had an interest therein.

“Preferred Excepted Person” shall mean any Person approved by the Board of Trustees, at their option and in their sole discretion, provided, however, that such approval shall not be granted to any Person whose ownership of in excess of 20% of the lesser of the number or the value of the total Series E Convertible Preferred Shares outstanding would result, directly, indirectly or as a result of attribution of ownership, in termination of the status of the Trust as a real estate investment trust under the REIT Provisions of the Code.

(f)The Trust, by notice to the holder thereof, may purchase any or all Series E Convertible Preferred Shares that are proposed to be transferred pursuant to a transfer which, in the opinion of the Board of Trustees, which shall be binding upon any proposed transferor or transferee of Series E Convertible Preferred Shares, would result in any Person acquiring Excess Preferred Shares, or would otherwise jeopardize the status of the Trust as a real estate investment trust under the REIT Provisions of the Code.  The Trust shall have the power, by lot or other means deemed equitable by the Board of Trustees in their sole discretion, to purchase such Excess Preferred Shares from the prospective transferor.  The purchase price for any Excess Preferred Shares shall be equal to the fair market value of the Series E Convertible Preferred Shares on the last trading day immediately preceding the day on which notice of such proposed transfer is sent, as reflected in the closing sale price for the Series E Convertible Preferred Shares, if then listed on a national securities exchange, or such price for the Series E Convertible Preferred Shares on the principal exchange if then listed on more than one national securities exchange, or if the Series E Convertible Preferred Shares are not then listed on a national securities exchange, the latest bid quotation for the Series E Convertible Preferred Shares if then traded over-the-counter, or, if no such closing sales prices or quotations are available, then the purchase price shall be equal to the fair market value of such Series E Convertible Preferred Shares as determined by the Board of Trustees in good faith.  Prompt payment of the purchase price shall be made in cash by the Trust in such manner as may be determined by the Board of Trustees.  From and after the date fixed for purchase by the Board of Trustees, and so long as payment of the purchase price for the Series E Convertible Preferred Shares to be so redeemed shall have been made or duly provided for, the holder of any Excess Preferred Shares so called for purchase shall cease to be entitled to dividends, distributions, voting rights and other benefits with respect to such Series E Convertible Preferred Shares, excepting only the right to payment of the purchase price fixed as aforesaid.  Any dividend or distribution paid to a proposed transferee of Excess Preferred Shares prior to the discovery by the Trust that the Series E Convertible Preferred Shares have been transferred in violation of this Section 3 shall be repaid to the Trust upon demand.

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(g)Notwithstanding any other provision in this Declaration of Trust or the Trust’s Bylaws, Sections 13.5(3)(e), (f), (g) and (h) may not be amended or repealed without the affirmative vote of the holders of not less than two-thirds of the Series E Convertible Preferred Shares then outstanding and entitled to vote.  If Section 13.5(3)(e), (f), (g) or (h) is determined to be void or invalid by virtue of any legal decision, statute, rule or regulation, then the acquiror of Series E Convertible Preferred Shares in violation of such Sections shall be deemed, at the option of the Trust, to have acted as agent on behalf of the Trust in acquiring such Series E Convertible Preferred Shares on behalf of the Trust.

(h)Subject to Section 13.5(3)(l), notwithstanding any other provision of this Section 13.5 to the contrary, any purported transfer, sale or acquisition of Series E Convertible Preferred Shares (whether such purported transfer, sale or acquisition results from the direct or indirect acquisition of ownership of Series E Convertible Preferred Shares) which would result in the termination of the status of the Trust as a real estate investment trust under the REIT Provisions of the Code shall be null and void ab initio.  Any such Series E Convertible Preferred Shares may be treated by the Board of Trustees in the manner prescribed for Excess Preferred Shares in subsection (f) of this Section 13.5(3).

(i)Subject to Section 13.5(3)(l), nothing contained in this Section 13.5(3) or in any other provision of this Section 13.5 shall limit the authority of the Board of Trustees to take such other action as they deem necessary or advisable to protect the Trust and the interests of the shareholders by preservation of the Trust’s status as a real estate investment trust under the REIT Provisions of the Code.

(j)If any provision of this Section 13.5(3) or any application of any such provision is determined to be invalid by any federal or state court having jurisdiction over the issues, the validity of the remaining provisions shall not be affected and other applications of such provision shall be affected only to the extent necessary to comply with the determination of such court.  To the extent this Section 13.5(3) may be inconsistent with any other provision of this Section 13.5, this Section 13.5(3) shall be controlling.

(k)For purposes of this Section 13.5, Series E Convertible Preferred Shares not owned directly shall be deemed to be owned indirectly by a person if that person or a group of which he is a member would be the beneficial owner of such Series E Convertible Preferred Shares, as defined in Rule 13d-3 under the Securities Exchange Act of 1934, and/or would be considered to own such Series E Convertible Preferred Shares by reason of the REIT Provisions of the Code.

(l)Notwithstanding any other provision of Section 13.5(3), nothing in this Section 13.5 shall preclude the settlement of transactions entered into through the facilities of the New York Stock Exchange, Inc.  The fact that the settlement of any transaction is permitted shall not negate the effect of any other provision of this Section 13.5(3) and any transferee in such a transaction shall be subject to all of the provisions and limitations set forth in this Section 13.5(3).

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4.Redemption at the Option of the Trust.

(a) The Series E Convertible Preferred Shares are not redeemable prior to November 1, 1998.  On and after November 1, 1998, the Series E Convertible Preferred Shares may be redeemed at the option of the Trust by resolution of its Board of Trustees, in whole or from time to time in part, subject to the limitations set forth below, at the following redemption prices per share if redeemed during the twelve-month period beginning November 1 of the year indicated below (the “Call Price”), plus, in each case, all distributions accrued and unpaid on the shares of the Series E Convertible Preferred Shares up to the date of such redemption, upon giving notice as provided below:

If redeemed during
the twelve-month
period beginning	Call
November 1,	Price
1998	$	25.875
1999	$	25.700
2000	$	25.525
2001	$	25.350
2002	$	25.175
2003 and thereafter	$	25.000

(b)If fewer than all of the outstanding Series E Convertible Preferred Shares are to be redeemed, the shares to be redeemed shall be determined pro rata or by lot or in such other manner and subject to such regulations as the Board of Trustees in its sole discretion shall prescribe.  In the event that such redemption is to be by lot, if as a result of such redemption any holder of Series E Convertible Preferred Shares would become a holder of in excess of 20% of the lesser of the number or the value of the total Series E Convertible Preferred Shares outstanding because such holder’s Series E Convertible Preferred Shares were not redeemed, or were only redeemed in part, then the Trust shall redeem the requisite number of Series E Convertible Preferred Shares of such shareholder such that he will not hold in excess of 20% of the lesser of the number or the value of the total Series E Convertible Preferred Shares outstanding subsequent to such redemption, unless the holder is a Preferred Excepted Person (as defined in Section 3(e) hereof), in which event the Trust shall have the option to redeem such requisite number of Series E Convertible Preferred Shares, as determined in the sole discretion of the Board of Trustees.

(c)At least 30 days but not more than 60 days prior to the date fixed for the redemption of the Series E Convertible Preferred Shares, the Trust shall mail a written notice to each holder of record of the Series E Convertible Preferred Shares to be redeemed in a postage prepaid envelope addressed to such holder at his address as shown on the records of the Trust, notifying such holder of the election of the Trust to redeem such shares, stating the date fixed for redemption thereof (the “Redemption Date”), the redemption price, the number of shares to be redeemed (and, if fewer than all the Series E Convertible Preferred Shares are to be redeemed, the number of shares to be redeemed from

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such holder) and the place(s) where the certificate(s) representing such shares are to be surrendered for payment.  On or after the Redemption Date each holder of the Series E Convertible Preferred Shares to be redeemed shall present and surrender his certificate or certificates for such shares to the Trust at the place designated in such notice and thereupon the redemption price of such shares shall be paid to or on the order of the person whose name appears on such certificate or certificates as the owner thereof and each surrendered certificate shall be cancelled.  In the event that fewer than all the shares represented by any such certificate are redeemed, a new certificate shall be issued representing the unredeemed shares.  From and after the Redemption Date (unless default shall be made by the Trust in payment of the redemption price), all distributions on the Series E Convertible Preferred Shares designated for redemption in such notice shall cease to accrue, and all rights of the holders thereof as shareholders of the Trust, except the right to receive the redemption price of such shares (including all accrued and unpaid distributions up to the Redemption Date) upon the surrender of certificates representing the same, shall cease and terminate and such shares shall not thereafter be transferred (except with the consent of the Trust) on the books of the Trust, and such shares shall not be deemed to be outstanding for any purpose whatsoever.  At its election, the Trust prior to the Redemption Date may irrevocably deposit the redemption price (including all accrued and unpaid distributions up to the Redemption Date) of the Series E Convertible Preferred Shares so called for redemption in trust for the holders thereof with a bank or trust company (having a capital surplus and undivided profits aggregating not less than $50,000,000) in the Borough of Manhattan, City and State of New York, or in any other city in which the Trust at the time shall maintain a transfer agency with respect to such shares, in which case the aforesaid notice to holders of the Series E Convertible Preferred Shares to be redeemed shall state the date of such deposit, shall specify the office of such bank or trust company as the place of payment of the redemption price, and shall call upon such holders to surrender the certificates representing such shares at such place on or after the date fixed in such redemption notice (which shall not be later than the Redemption Date) against payment of the redemption price (including all accrued and unpaid distributions up to the Redemption Date).  Any interest accrued on such funds shall be paid to the Trust from time to time.  Any moneys so deposited which shall remain unclaimed by the holders of the Series E Convertible Preferred Shares at the end of two years after the Redemption Date shall be returned by such bank or trust company to the Trust.

If a notice of redemption has been given pursuant to this Section 13.5(4) and any holder of Series E Convertible Preferred Shares shall, prior to the close of business on the last business day preceding the Redemption Date, give written notice to the Trust pursuant to Section 13.5(7) below of the conversion of any or all of the shares to be redeemed held by such holder (accompanied by a certificate or certificates for such shares, duly endorsed or assigned to the Trust, and any necessary transfer tax payment, as required by Section 13.5(7) below, then such redemption shall not become effective as to such shares to be converted, such conversion shall become effective as provided in Section 13.5(7) below and any moneys set aside by the Trust for the redemption of such shares of converted Series E Convertible Preferred Shares shall revert to the general funds of the Trust (unless such shares were converted after the close of business on the record date for a distribution and before the opening of business on the payment date for such distribution, in which

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event the holders of such shares shall be entitled to the distribution payable thereon on such distribution payment date).

Notwithstanding the foregoing, unless full cumulative distributions on all outstanding Series E Convertible Preferred Shares have been paid or declared and a sum sufficient for the payment thereof set apart for payment for all past distribution periods and the then current distribution period, no Series E Convertible Preferred Shares shall be redeemed unless all outstanding Series E Convertible Preferred Shares are simultaneously redeemed; provided, however, that the foregoing shall not prevent the purchase or acquisition of Series E Convertible Preferred Shares pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding Series E Convertible Preferred Shares, and, unless full cumulative distributions on all outstanding Series E Convertible Preferred Shares have been paid or declared and a sum sufficient for the payment thereof set apart for payment for all past distribution periods and the then current distribution period, the Trust shall not purchase or otherwise acquire directly or indirectly any Series E Convertible Preferred Shares (except by conversion into or exchange for shares of beneficial interest of the Trust ranking junior to the Series E Convertible Preferred Shares as to distribution rights and the liquidation preference).

(d)The Series E Convertible Preferred Shares redeemed, repurchased or retired pursuant to the provisions of this Section 13.5(4) or surrendered to the Trust upon conversion shall thereupon be retired and may not be reissued as Series E Convertible Preferred Shares but shall thereafter have the status of authorized but unissued shares of beneficial interest.

5.Voting Rights.

(a)The holders of Series E Convertible Preferred Shares shall not be entitled to vote on any matter except (i) as provided in Section 13.5(9), (ii) as provided in Section 13.5(5)(b) and (iii) as required by law.

(b)In the event the Trust shall have failed to declare and pay or set apart for payment in full the distributions accumulated on the outstanding Series E Convertible Preferred Shares for any six consecutive quarterly distribution payment periods (a “Preferential Distribution Non-Payment”), the number of trustees of the Trust shall be increased by two and the holders of the outstanding Series E Convertible Preferred Shares, voting together as a class with all other classes or series of preferred shares of the Trust ranking on a parity with the Series E Convertible Preferred Shares with respect to distribution rights and then entitled to vote on the election of such additional two trustees, shall be entitled to elect such two additional trustees until the full distributions accumulated on all outstanding Series E Convertible Preferred Shares have been declared and paid or set apart for payment.  Upon the occurrence of a Preferential Distribution Non-Payment or a vacancy in the office of a Preferred Shares Trustee (as defined below), the Board of Trustees shall within a reasonable period call a special meeting of the holders of the Series E Convertible Preferred Shares and all holders of other classes or series of preferred shares of the Trust ranking on a parity with the Series E Convertible Preferred Shares with respect to distribution rights who are then entitled to vote on the election of such additional trustee

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or trustees for the purpose of electing the additional trustee or trustees.  If and when all accumulated distributions on the Series E Convertible Preferred Shares have been declared and paid or set aside for payment in full, the holders of the Series E Convertible Preferred Shares shall be divested of the special voting rights provided by this Section 13.5(5)(b), subject to revesting in the event of each and every subsequent Preferential Distribution Non-Payment.  Upon termination of such special voting rights attributable to all holders of the Series E Convertible Preferred Shares and shares of any other class or series of preferred shares of the Trust ranking on a parity with the Series E Convertible Preferred Shares with respect to distribution rights, the term of office of each trustee elected by the holders of the Series E Convertible Preferred Shares and such parity preferred shares (a “Preferred Shares Trustee”) pursuant to such special voting rights shall forthwith terminate and the number of trustees constituting the entire Board of Trustees shall be reduced by the number of Preferred Shares Trustees.  Any Preferred Shares Trustee may be removed by, and shall not be removed otherwise than by, the vote of the holders of record of a majority of the outstanding Series E Convertible Preferred Shares and all other series of preferred shares of the Trust ranking on a parity with the Series E Convertible Preferred Shares with respect to distribution rights who were entitled to vote in such Preferred Shares Trustee’s election, voting as a separate class, at a meeting called for such purpose.

(c)So long as any Series E Convertible Preferred Shares are outstanding, the number of trustees constituting the entire Board of Trustees of the Trust shall at all times be such that the exercise, by the holders of the Series E Convertible Preferred Shares and the holders of preferred shares of the Trust ranking on a parity with the Series E Convertible Preferred Shares with respect to distribution rights, of the right to elect trustees under the circumstances provided for in subclause (b) of this Section 13.5(5) will not contravene any other provision of this Declaration restricting the number of trustees which may constitute the entire Board of Trustees of the Trust.

(d)Trustees elected pursuant to subclause (b) of this Section 13.5(5) shall serve until the earlier of (x) the next annual meeting of the shareholders of the Trust and the election (by the holders of the Series E Convertible Preferred Shares and the holders of preferred shares of the Trust ranking on a parity with the Series E Convertible Preferred Shares with respect to distribution rights) and qualification of their respective successors or (y) the termination of the term of office of each Preferred Shares Trustee upon the termination of the special voting rights as provided for in Section 13.5(5)(b).

(e)So long as a Preferential Distribution Non-Payment shall continue, any vacancy in the office of a Preferred Shares Trustee may be filled by vote of the holders of record of a majority of the outstanding Series E Convertible Preferred Shares and all other series of preferred shares ranking on a parity with the Series E Convertible Preferred Shares with respect to distribution rights who are then entitled to vote in the election of such Preferred Shares Trustee as provided above.  As long as the Preferential Distribution Non-Payment shall continue, holders of the Series E Convertible Preferred Shares shall not, as such shareholders, be entitled to vote on the election or removal of trustees other than Preferred Shares Trustees, but shall not be divested of any other voting rights provided to such shareholders by law, this Declaration with respect to any other matter to be acted upon by the shareholders of the Trust.

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6.Liquidation Preference.

(a)In the event of any liquidation, dissolution or winding up of the affairs of the Trust, whether voluntary or otherwise, after payment or provision for payment of the debts and other liabilities of the Trust, the holders of Series E Convertible Preferred Shares shall be entitled to receive, in cash, out of the remaining assets of the Trust legally available therefor, the amount of Twenty-five Dollars ($25.00) for each Series E Convertible Preferred Share, plus an amount equal to all distributions accrued and unpaid on each such share up to the date of such distribution of assets, before any distribution shall be made to the holders of Common Shares or any other shares of beneficial interest of the Trust ranking (as to any such distribution of assets) junior to the Series E Convertible Preferred Shares.  If upon any liquidation, dissolution or winding up of the Trust, the assets distributable among the holders of Series E Convertible Preferred Shares and all other classes and series of preferred shares ranking (as to any such distribution of assets) on a parity with the Series E Convertible Preferred Shares are insufficient to permit the payment in full to the holders of all such shares of all preferential amounts payable to all such holders, then the entire assets of the Trust thus distributable shall be distributed ratably among the holders of Series E Convertible Preferred Shares and such other classes and series of preferred shares ranking (as to any such distribution of assets) on a parity with the Series E Convertible Preferred Shares in proportion to the respective amounts that would be payable per share if such assets were sufficient to permit payment in full.

(b)For purposes of this Section 13.5(6), a distribution of assets in any dissolution, winding up or liquidation shall not include (i) any consolidation or merger of the Trust with or into any other corporation, (ii) any dissolution, liquidation, winding up or reorganization of the Trust immediately followed by incorporation of another corporation to which such assets are distributed or (iii) a sale or other disposition of all or substantially all of the Trust’s assets to another corporation; provided, however, that, in each case, effective provision is made in the charter of the resulting and surviving corporation or otherwise for the recognition, preservation and protection of the rights of the holders of Series E Convertible Preferred Shares.

(c)After the payment of the full preferential amounts provided for herein to the holders of Series E Convertible Preferred Shares or funds necessary for such payment have been set aside in trust for the holders thereof, such holders shall be entitled to no other or further participation in the distribution of the assets of the Trust.

(d)In determining whether a distribution by dividend, redemption or other acquisition of Shares or otherwise is permitted under Maryland law, no effect shall be given to amounts that would be needed, if the Trust were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of shareholders whose preferential rights on dissolution are superior to those receiving the distribution.

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7.Conversion.

(a)Holders of Series E Convertible Preferred Shares shall have the right, exercisable at any time and from time to time, except in the case of the Series E Convertible Preferred Shares called for redemption as set forth below, to convert all or any such Series E Convertible Preferred Shares into Common Shares at the conversion price of $44.93 per Common Share (equivalent to a conversion rate of approximately 0.5564 Common Shares for each Series E Convertible Preferred Share so converted), subject to adjustment as described below.  In the case of Series E Convertible Preferred Shares called for redemption, conversion rights will expire at the close of business on the last business day preceding the Redemption Date.  Notice of redemption at the option of the Trust must be mailed not less than 30 days and not more than 60 days prior to the Redemption Date as provided in Section 13.5(4)(c) hereof.  Upon conversion, no adjustment or payment will be made for distributions, but if any holder surrenders Series E Convertible Preferred Shares for conversion after the close of business on the record date for the payment of a distribution and prior to the opening of business on the related distribution payment date, then, notwithstanding such conversion, the distribution payable on such distribution payment date will be paid to the registered holder of such shares on such distribution record date.  In such event, such shares, when surrendered for conversion during the period between the close of business on any distribution record date and the opening of business on the corresponding distribution payment date, must be accompanied by payment of an amount equal to the distribution payable on such distribution payment date on the shares so converted (unless such shares were converted after the issuance of a notice of redemption with respect to such shares, in which event such shares shall be entitled to the distribution payable thereon on such distribution payment date without making such payment).

(b)Any holder of one or more Series E Convertible Preferred Shares electing to convert such share or shares shall deliver the certificate or certificates therefor to the principal office of any transfer agent for the Common Shares, with the form of notice of election to convert as the Trust shall prescribe fully completed and duly executed and (if so required by the Trust or any conversion agent) accompanied by instruments of transfer in form satisfactory to the Trust and to any conversion agent, duly executed by the registered holder or his duly authorized attorney, and transfer taxes, stamps or funds therefor or evidence of payment thereof if required pursuant to Section 13.5(7)(a) or 13.5(7)(d) hereof.  The conversion right with respect to any such shares shall be deemed to have been exercised at the date upon which the certificates therefor accompanied by such duly executed notice of election and instruments of transfer and such taxes, stamps, funds or evidence of payment shall have been so delivered, and the person or persons entitled to receive the shares of the Common Shares issuable upon such conversion shall be treated for all purposes as the record holder or holders of such shares of the Common Shares upon said date.

(c)No fractional Common Share or scrip representing a fractional share shall be issued upon conversion of Series E Convertible Preferred Shares.  If more than one Series E Convertible Preferred Share shall be surrendered for conversion at one time by the same holder, the number of full Common Shares which shall be issuable

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upon conversion thereof shall be computed on the basis of the aggregate number of Series E Convertible Preferred Shares so surrendered.  Instead of any fractional Common Share which would otherwise be issuable upon conversion of any Series E Convertible Preferred Shares, the Trust shall pay a cash adjustment in respect of such fraction in an amount equal to the same fraction of the closing price for the Common Shares on the last trading day preceding the date of conversion.  The closing price for such day shall be the last reported sales price regular way or, in case no such reported sale takes place on such date, the average of the reported closing bid and asked prices regular way, in either case on the New York Stock Exchange, or if the Common Shares are not listed or admitted to trading on such Exchange, on the principal national securities exchange on which the Common Shares are listed or admitted to trading or, if not listed or admitted to trading on any national securities exchange, the closing sale price of the Common Shares or in case no reported sale takes place, the average of the closing bid and asked prices, on NASDAQ or any comparable system.  If the Common Shares are not quoted on NASDAQ or any comparable system, the Board of Trustees shall in good faith determine the current market price on the basis of such quotation as it considers appropriate.

(d)If a holder converts Series E Convertible Preferred Shares, the Trust shall pay any documentary, stamp or similar issue or transfer tax due on the issuance of Common Shares upon the conversion.  The holder, however, shall pay to the Trust the amount of any tax which is due (or shall establish to the satisfaction of the Trust payment thereof) if the shares are to be issued in a name other than the name of such holder and shall pay to the Trust any amount required by the last sentence of Section 13.5(7)(a) hereof.

(e)The Trust shall reserve and shall at all times have reserved out of its authorized but unissued Common Shares a sufficient number of Common Shares to permit the conversion of the then outstanding Series E Convertible Preferred Shares.  All Common Shares which may be issued upon conversion of Series E Convertible Preferred Shares shall be validly issued, fully paid and nonassessable, and not subject to preemptive or other similar rights.  In order that the Trust may issue Common Shares upon conversion of Series E Convertible Preferred Shares, the Trust will endeavor to comply with all applicable Federal and State securities laws and will endeavor to list such Common Shares to be issued upon conversion on each securities exchange on which the Common Shares are listed.

(f)The conversion rate in effect at any time shall be subject to adjustment from time to time as follows:

(i)In case the Trust shall (1) pay or make a distribution in Common Shares to holders of the Common Shares, (2) reclassify the outstanding Common Shares into shares of some other class or series of shares, (3) subdivide the outstanding Common Shares into a greater number of Common Shares or (4) combine the outstanding Common Shares into a smaller number of Common Shares, the conversion rate immediately prior to such action shall be adjusted so that the holder of any

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Series E Convertible Preferred Shares thereafter surrendered for conversion shall be entitled to receive the number of Common Shares which he would have owned immediately following such action had such Series E Convertible Preferred Shares been converted immediately prior thereto.  An adjustment made pursuant to this Section 13.5(7)(f)(i) shall become effective immediately after the record date in the case of a distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or reclassification.

(ii)In case the Trust shall issue rights or warrants to all holders of the Common Shares entitling them to subscribe for or purchase Common Shares (or securities convertible into Common Shares) at a price per share less than the current market price (as determined pursuant to Section 13.5(7)(f)(iv)) of the Common Shares on such record date, the number of Common Shares into which each Series E Convertible Preferred Share shall be convertible shall be adjusted so that the same shall be equal to the number determined by multiplying the number of Common Shares into which such Series E Convertible Preferred Share was convertible immediately prior to such record date by a fraction of which the numerator shall be the number of Common Shares outstanding on such record date plus the number of additional Common Shares offered (or into which the convertible securities so offered are convertible), and of which the denominator shall be the number of Common Shares outstanding on such record date, plus the number of Common Shares which the aggregate offering price of the additional Common Shares offered (or into which the convertible securities so offered are convertible) would purchase at such current market price.  Such adjustments shall become effective immediately after such record date for the determination of the holders of the Common Shares entitled to receive such distribution.  For purposes of this subsection (ii), the number of Common Shares at any time outstanding shall not include Common Shares held in the treasury of the Trust.

(iii)In case the Trust shall distribute to all holders of the Common Shares any class of shares of beneficial interest other than the Common Shares, evidences of

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indebtedness or assets of the Trust (other than cash distributions out of current or retained earnings), or shall distribute to all holders of the Common Shares rights or warrants to subscribe for securities (other than those referred to in Section 13.5(7)(f)(ii)), then in each such case the number of Common Shares into which each Series E Convertible Preferred Share shall be convertible shall be adjusted so that the same shall equal the number determined by multiplying the number of Common Shares into which such Series E Convertible Preferred Share was convertible immediately prior to the date of such distribution by a fraction of which the numerator shall be the current market price (determined as provided in Section 13.5(7)(f)(iv)) of the Common Shares on the record date mentioned below, and of which the denominator shall be such current market price of the Common Shares, less the then fair market value (as determined by the Board of Trustees, whose determination shall be conclusive evidence of such fair market value) of the portion of the securities or assets so distributed or of such subscription rights or warrants applicable to one Common Share.  Such adjustment shall become effective immediately after the record date for the determination of the holders of the Common Shares entitled to receive such distribution.  Notwithstanding the foregoing, in the event that the Trust shall distribute rights or warrants (other than those referred to in Section 13.5(7)(f)(ii)) (“Rights”) pro rata to holders of the Common Shares, the Trust may, in lieu of making any adjustment pursuant to this Section 13.5(7)(f)(iii), make proper provision so that each holder of a Series E Convertible Preferred Share who converts such share after the record date for such distribution and prior to the expiration or redemption of the Rights shall be entitled to receive upon such conversion, in addition to the Common Shares issuable upon such conversion (the “Conversion Shares”), a number of Rights to be determined as follows: (1) if such conversion occurs on or prior to the date for the distribution to the holders of Rights of separate certificates evidencing such Rights (the “Distribution Date”), the same number of Rights to which a holder of a number of Common Shares equal to the number of Conversion Shares is entitled at the time of such conversion in accordance with the terms and provisions of and applicable to the Rights; and (2)

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if such conversion occurs after the Distribution Date, the same number of Rights to which a holder of the number of Common Shares into which a Series E Convertible Preferred Share so converted was convertible immediately prior to the Distribution Date would have been entitled on the Distribution Date in accordance with the terms and provisions of and applicable to the Rights.

(iv)The current market price per share of the Common Shares on any date shall be deemed to be the average of the daily closing prices for thirty consecutive trading days commencing forty-five trading days before the date in question.  The closing price for each day shall be the last reported sales price regular way or, in case no such reported sale takes place on such date, the average of the reported closing bid and asked prices regular way, in either case on the New York Stock Exchange, or if the Common Shares are not listed or admitted to trading on such Exchange, on the principal national securities exchange on which the Common Shares are listed or admitted to trading or, if not listed or admitted to trading on any national securities exchange, the closing sale price of the Common Shares or, in case no reported sale takes place, the average of the closing bid and asked prices, on NASDAQ or any comparable system, or if the Common Shares are not quoted on NASDAQ or any comparable system, the closing sale price or, in case no reported sale takes place, the average of the closing bid and asked prices, as furnished by any two members of the National Association of Securities Dealers, Inc. selected from time to time by the Trust for that purpose.

(v)In any case in which this Section 13.5(7) shall require that an adjustment be made immediately following a record date, the Trust may elect to defer (but only until five business days following the mailing of the notice described in Section 13.5(7)(j)) issuing to the holder of any Series E Convertible Preferred Shares converted after such record date the Common Shares and other shares of beneficial interest of the Trust issuable upon such conversion over and above the Common Shares and other shares of beneficial interest of the Trust issuable upon such conversion only on the basis of the conversion rate prior to adjustment; and,

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in lieu of the shares the issuance of which is so deferred, the Trust shall issue or cause its transfer agents to issue appropriate evidence of the right to receive such shares.

(g)No adjustment in the conversion rate shall be required until cumulative adjustments result in a change of 1% or more of the conversion price as in effect prior to the last adjustment of the conversion rate; provided, however, that any adjustment which by reason of this Section 13.5(7)(g) is not required to be made shall be carried forward and taken into account in any subsequent adjustment.  All calculations under this Section 13.5(7) shall be made to the nearest cent ($.01) or to the nearest one-hundredth (1/100) of a share, as the case may be.  No adjustment to the conversion rate shall be made for cash dividends.

(h)In the event that, as a result of an adjustment made pursuant to Section 13.5(7)(f), the holder of any Series E Convertible Preferred Shares thereafter surrendered for conversion shall become entitled to receive any shares of beneficial interest of the Trust other than Common Shares, thereafter the number of such other shares so receivable upon conversion of any Series E Convertible Preferred Shares shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the Common Shares contained in this Section 13.5(7).

(i)The Trust may make such increases in the conversion rate, in addition to those required by Sections 13.5(7)(f)(i), (ii) and (iii), as is considered to be advisable in order that any event treated for Federal income tax purposes as a distribution of shares or share rights shall not be taxable to the recipients thereof.

(j)Whenever the conversion rate is adjusted, the Trust shall promptly mail to all holders of record of Series E Convertible Preferred Shares a notice of the adjustment and shall cause to be prepared a certificate signed by a principal financial officer of the Trust setting forth the adjusted conversion rate and a brief statement of the facts requiring such adjustment and the computation thereof; such certificate shall forthwith be filed with each transfer agent for the Series E Convertible Preferred Shares.

(k)In the event that:

(1)the Trust takes any action which would require an adjustment in the conversion rate,

(2)the Trust consolidates or merges with, or transfers all or substantially all of its assets to, another corporation and shareholders of the Trust must approve the transaction, or

(3)there is a dissolution, winding up or liquidation of the Trust,

a holder of Series E Convertible Preferred Shares may wish to convert some or all of such shares into Common Shares prior to the record date for, or the effective date of, the

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transaction so that he may receive the rights, warrants, securities or assets which a holder of Common Shares on that date may receive.  Therefore, the Trust shall mail to holders of Series E Convertible Preferred Shares a notice stating the proposed record or effective date of the transaction, as the case may be.  The Trust shall mail the notice at least 10 days before such date; however, failure to mail such notice or any defect therein shall not affect the validity of any transaction referred to in clauses (1), (2) or (3) of this Section 13.5(7)(k).

(l)If any of the following shall occur, namely: (i) any reclassification or change of outstanding Common Shares issuable upon conversion of Series E Convertible Preferred Shares (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination), (ii) any consolidation or merger to which the Trust is a party other than a merger in which the Trust is the surviving entity and which does not result in any reclassification of, or change (other than a change in name, or par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination) in, outstanding Common Shares or (iii) any sale, transfer or lease of all or substantially all of the property or business of the Trust as an entirety, then the Trust, or such successor or purchasing entity, as the case may be, shall, as a condition precedent to such reclassification, change, consolidation, merger, sale, transfer or lease, provide in its charter document that each Series E Convertible Preferred Share shall be convertible into the kind and amount of shares of stock or beneficial interest and other securities and property (including cash) receivable upon such reclassification, change, consolidation, merger, sale, transfer or lease by a holder of the number of Common Shares deliverable upon conversion of such Series E Convertible Preferred Share immediately prior to such reclassification, change, consolidation, merger, sale, transfer or lease.  Such charter document shall provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 13.5(7).  The foregoing, however, shall not in any way affect the right that a holder of Series E Convertible Preferred Shares may otherwise have, pursuant to clause (2) of the last sentence of Section 13.5(7)(f)(iii), to receive Rights upon conversion of Series E Convertible Preferred Shares.  If, in the case of any such consolidation, merger, sale, transfer or lease, the shares of stock or beneficial interest or other securities and property (including cash) receivable thereupon by a holder of the Common Shares includes shares of stock or beneficial interest or other securities and property of a corporation other than the successor or purchasing corporation, as the case may be, in such consolidation, merger, sale, transfer or lease, then the charter document of such other corporation shall contain such additional provisions to protect the interests of the holders of Series E Convertible Preferred Shares as the Board of Trustees shall reasonably consider necessary by reason of the foregoing.  The provisions of this Section l3.5(7)(l) shall similarly apply to successive consolidations, mergers, sales, transfers or leases.

8.Ranking.  With regard to rights to receive distributions and amounts payable upon liquidation, dissolution or winding up of the Trust, the Series E Convertible Preferred Shares shall rank senior to the Common Shares and on a parity with any other preferred shares issued by the Trust, unless the terms of such other preferred shares provide otherwise and, if applicable, the requirements of Section 9 hereof have been complied with.  However, the Trust may authorize or increase any class or series of shares of beneficial interest ranking on a parity with or junior to the Series E Convertible Preferred Shares as to

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distribution rights and the liquidation preference without the vote or consent of the holders of the Series E Convertible Preferred Shares.

9.Limitations.  In addition to any other rights provided by applicable law, so long as any Series E Convertible Preferred Shares are outstanding, the Trust shall not, without the affirmative vote, or the written consent as provided by law, of the holders of at least two-thirds (2/3) of the total number of outstanding Series E Convertible Preferred Shares, voting as a class,

(a)authorize, create or issue, or increase the authorized or issued amount of, any class or series of, or rights to subscribe to or acquire, any security convertible into, any class or series of shares of beneficial interest ranking as to distribution rights or the liquidation preference, senior to the Series E Convertible Preferred Shares, or reclassify any shares of beneficial interest into any such shares; or

(b)amend, alter or repeal, whether by merger, consolidation or otherwise, any of the provisions of this Declaration that would change the preferences, rights or powers with respect to the Series E Convertible Preferred Shares so as to affect the Series E Convertible Preferred Shares adversely;

but (except as otherwise required by applicable law) nothing herein contained shall require such a vote or consent (i) in connection with any increase in the total number of authorized Common Shares, or (ii) in connection with the authorization or increase of any class or series of shares of beneficial interest ranking, as to distribution rights and the liquidation preference, on a parity with or junior to the Series E Convertible Preferred Shares; and provided further that no such vote or written consent of the holders of the Series E Convertible Preferred Shares shall be required if, at or prior to the time when the issuance of any such shares ranking senior to the Series E Convertible Preferred Shares is to be made or any such change is to take effect, as the case may be, proper notice has been given and sufficient funds have been irrevocably deposited in trust for the redemption of all the then outstanding Series E Convertible Preferred Shares.

10.No Preemptive Rights.  No holder of Series E Convertible Preferred Shares will possess any preemptive rights to subscribe for or acquire any unissued shares of beneficial interest of the Trust (whether now or hereafter authorized) or securities of the Trust convertible into or carrying a right to subscribe to or acquire shares of beneficial interest of the Trust.

SECTION 13.6.[Intentionally Omitted]

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SECTION 13.7.Series H Preferred Shares.

Section 1.Number of Shares and Designation.  This series of Preferred Shares shall be designated as Series H Cumulative Convertible Preferred Shares of Beneficial Interest ($.01 Par Value Per Share) (Liquidation Preference $25.00 Per Share) (the “Series H Preferred Shares”) and 164,951 shall be the number of shares constituting such series.

Section 2.Definitions. For purposes of the Series H Preferred Shares, the following terms shall have the meanings indicated:

“Act” shall have the meaning set forth in paragraph (g) of Section 5 hereof.

“Board of Trustees” shall mean the Board of Trustees of the Trust or any committee of the Board of Trustees authorized by such Board of Trustees to perform any of its responsibilities with respect to the Series H Preferred Shares.

“Business Day” shall mean any day other than a Saturday, Sunday or a day on which state or federally chartered banking institutions in Chicago, Illinois or New York, New York are not required to be open.

“Call Date” shall have the meaning set forth in paragraph (c) of Section 5 hereof.

“Common Shares” shall mean the common shares of beneficial interest of the Trust, $.01 par value per share.

“Constituent Person” shall have the meaning set forth in paragraph (e) of Section 7 hereof.

“Conversion Price” shall mean the conversion price per Common Share for which a Series H Preferred Share is convertible, as such Conversion Price may be adjusted pursuant to Section 7 hereof.  The initial conversion price shall be $34.53 (equivalent to a conversion rate of .7240 Common Shares for each Series H Preferred Share).

“Current Market Price” of publicly traded Common Shares or any other class of shares of beneficial interest or other security of the Trust or any other issuer for any day shall mean the last reported sales price, regular way on such day, or, if no sale takes place on such day, the average of the reported closing bid and asked prices on such day, regular way, in either case as reported on the New York Stock Exchange (“NYSE”) or, if such security is not listed or admitted for trading on the NYSE, on the principal national securities exchange on which such security is listed or admitted for trading or, if not listed or admitted for trading on any national securities exchange, on the National Market System of the National Association of Securities Dealers, Inc. Automated Quotations System (“NASDAQ”) or, if such security is not quoted on such National Market System, the average of the closing bid and asked prices on such day in the over-the-counter market as reported by NASDAQ or, if bid and asked prices for such security on such day shall not have been reported through NASDAQ, the average of the bid and asked prices on such day as furnished by any NYSE member firm regularly making a market in such security selected for such purpose by the Chief Executive Officer of the Board of Trustees.

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“Dividend Payment Date” shall mean the last calendar day of March, June, September and December, in each year, commencing on December 31, 1998; provided, however, that if any Dividend Payment Date falls on any day other than a Business Day, the dividend payment due on such Dividend Payment Date shall be paid on the Business Day immediately following such dividend Payment Date.

“Dividend Periods” shall mean quarterly dividend periods commencing on January 1, April 1, July 1 and October 1 of each year and ending on and including the day preceding the first day of the next succeeding Dividend Period.

“Fair Market Value” shall mean the average of the daily Current Market Prices of a Common Share during the five (5) consecutive Trading Days selected by the Trust commencing not more than 20 Trading Days before, and ending not later than, the earlier of the day in question and the day before the “ex date” with respect to the issuance or distribution requiring such computation.  The term “ex date,” when used with respect to any issuance or distribution, means the first day on which the Common Shares trade regular way, without the right to receive such issuance or distribution, on the exchange or in the market, as the case may be, used to determine that day’s Current Market Price.

“Issue Date” shall mean the first day on which Series H Preferred Shares are issued.

“Junior Shares” shall mean the Common Shares and any other class or series of shares of the Trust over which the Series H Preferred Shares and the Parity Shares have preference or priority in the payment of dividends or in the distribution of assets on any liquidation, dissolution or winding up of the Trust.

“Non-Electing Share” shall have the meaning set forth in paragraph (e) of Section 7 hereof.

“Parity Shares” shall have the meaning set forth in paragraph (b) of Section 8 hereof.

“Permitted Common Share Cash Distributions” means cash dividends and distributions paid after December 31, 1997 not in excess of the Trust’s cumulative undistributed net earnings at December 31, 1997, plus the cumulative amount of funds from operations, as determined by Board of Trustees on a basis consistent with the financial reporting practices of the Trust, after December 31, 1997, minus the cumulative amount of dividends accrued or paid on the Series H Preferred Shares or any other class of Preferred Shares after the date of these Articles Supplementary.

“Person” shall mean any individual, firm, partnership, corporation or other entity, and shall include any successor (by merger or otherwise) of such entity.

“Press Release” shall have the meaning set forth in paragraph (b) of Section 5 hereof.

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“Securities” shall have the meaning set forth in paragraph (d)(iii) of Section 7 hereof.

“Series H Preferred Shares” shall have the meaning set forth in Section 1 hereof.

“set apart for payment” shall be deemed to include, without any action other than the following, the recording by the Trust in its accounting ledgers of any accounting or bookkeeping entry which indicates, pursuant to an authorization of dividends or other distribution by the Board of Trustees, the allocation of funds to be so paid on any series or class of shares of beneficial interest of the Trust; provided, however, that if any funds for any class or series of Junior Shares or any class or series of shares ranking on a parity with the Series H Preferred Shares as to the payment of dividends are placed in a separate account of the Trust or delivered to a disbursing, paying or other similar agent, then “set apart for payment” with respect to the Series H Preferred Shares shall mean placing such funds in a separate account or delivering such funds to a disbursing, paying or other similar agent.

“Trading Day” shall mean any day on which the securities in question are traded on the NYSE, or if such securities are not listed or admitted for trading on the NYSE, on the principal national securities exchange on which such securities are listed or admitted, or if not listed or admitted for trading on any national securities exchange, on the National Market System of NASDAQ, or if such securities are not quoted on such National Market System, in the applicable securities market in which the securities are traded.

“Transaction” shall have the meaning set forth in paragraph (e) of Section 7 hereof.

“Transfer Agent” means Boston Equiserve LP, Boston, Massachusetts, or such other agent or agents of the Trust as may be designated by the Board of Trustees or their designee as the transfer agent for the Series H Preferred Shares.

“Voting Preferred Shares” shall have the meaning set forth in Section 9 hereof.

Section 3.Dividends. (a) The holders of Series H Preferred Shares shall be entitled to receive, when, as and if authorized by the Board of Trustees out of funds legally available for that purpose, dividends payable in cash at the rate per annum of $1.75 per Series H Preferred Share. Such dividends shall be cumulative from October 1, 1998, whether or not in any Dividend Period or Periods there shall be funds of the Trust legally available for the payment of such dividends, and shall be payable quarterly, when, as and if authorized by the Board of Trustees, in arrears on Dividend Payment Dates, commencing on the first Dividend Payment Date after the Issue Date. Each such dividend shall be payable in arrears to the holders of record of Series H Preferred Shares, as they appear on the share records of the Trust at the close of business on such record dates, not more than 60 days preceding such Dividend Payment Dates thereof, as shall be fixed by the Board of Trustees. Accrued and unpaid dividends for any past Dividend Periods may be declared and paid at any time, without reference to any regular Dividend Payment Date, to holders

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of record on such date, not exceeding 45 days preceding the payment date thereof, as may be fixed by the Board of Trustees.

(b)The amount of dividends payable for each full Dividend Period for the Series H Preferred Shares shall be computed by dividing the annual dividend rate by four. The amount of dividends payable for any period shorter or longer than a full Dividend Period on the Series H Preferred Shares shall be computed on the basis of twelve 30-day months and a 360-day year. Holders of Series H Preferred Shares shall not be entitled to any dividends, whether payable in cash, property or shares, in excess of cumulative dividends, as herein provided, on the Series H Preferred Shares. No interest, or sum of money in lieu of interest, shall be payable in respect of any dividend payment or payments on the Series H Preferred Shares that may be in arrears.

(c)So long as any Series H Preferred Shares are outstanding, no dividends except as described in the immediately following sentence, shall be declared or paid or set apart for payment on any class or series of Parity Shares for any period unless full cumulative dividends have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for such payment on the Series H Preferred Shares for all Dividend Periods terminating on or prior to the Dividend Payment Date on such class or series of Parity Shares. When dividends are not paid in full or a sum sufficient for such payment is not set apart, as aforesaid, all dividends declared upon the Series H Preferred Shares and all dividends declared upon any other class or series of Parity Shares shall be declared ratably in proportion to the respective amounts of dividends accumulated and unpaid on the Series H Preferred Shares and accumulated and unpaid on such Parity Shares.

(d)So long as any Series H Preferred Shares are outstanding, no dividends (other than dividends or distributions paid in shares of, or options, warrants or rights to subscribe for or purchase, Junior Shares), shall be declared or paid or set apart for payment or other distribution declared or made upon Junior Shares, nor shall Junior Shares be redeemed, purchased or otherwise acquired (other than a redemption, purchase or other acquisition of Common Shares made for purposes of an employee incentive or benefit plan of the Trust or any subsidiary) for any consideration (or any moneys be paid to or made available for a sinking fund for the redemption of any shares of any such Junior Shares) by the Trust, directly or indirectly (except by conversion into or exchange for Junior Shares), unless in each case (i) the full cumulative dividends on all outstanding Series H Preferred Shares and any other Parity Shares of the Trust shall have been paid or set apart for payment for all past Dividend Periods with respect to the Series H Preferred Shares and all past dividend periods with respect to such Parity Shares and (ii) sufficient funds shall have been paid or set apart for the payment of the dividend for the current Dividend Period with respect to the Series H Preferred Shares and the current dividend period with respect to such Parity Shares.

Section 4.Liquidation Preference.  (a) In the event of any liquidation, dissolution or winding up of the Trust, whether voluntary or involuntary, before any payment or distribution of the assets of the Trust (whether capital or surplus) shall be made to or set apart for the holders of Junior Shares, the holders of the Series H Preferred Shares shall be entitled to receive Twenty-five Dollars ($25.00) per Series H Preferred Share plus an amount equal to all dividends (whether or not earned or declared) accrued and unpaid thereon to the date of final distribution to such holders; but such holders shall not be entitled to any further payment. If, upon liquidation, dissolution or winding up of the Trust, the assets of the Trust, or proceeds thereof, distributable

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among the holders of the Series H Preferred Shares shall be insufficient to pay in full the preferential amount aforesaid and liquidating payments on any other shares of any class or series of Parity Shares, then such assets, or the proceeds thereof, shall be distributed among the holders of Series H Preferred Shares and any such other Parity Shares ratably in accordance with the respective amounts that would be payable on such Series H Preferred Shares and any such other Parity Shares if all amounts payable thereon were paid in full. For the purposes of this Section 4, (i) a consolidation or merger of the Trust with one or more entities, (ii) a sale or transfer or all or substantially all of the Trust’s assets, or (iii) a statutory share exchange shall not be deemed to be a liquidation, dissolution or winding up, voluntary or involuntary, of the Trust.

(b)Subject to the rights of the holders of shares of any series or class or classes of shares ranking on a parity with or prior to the Series H Preferred Shares upon liquidation, dissolution or winding up, upon any liquidation, dissolution or winding up of the Trust, after payment shall have been made in full to the holders of the Series H Preferred Shares, as provided in this Section 4, any other series or class or classes of Junior Shares shall, subject to the respective terms and provisions (if any) applying thereto, be entitled to receive any and all assets remaining to be paid or distributed, and the holders of the Series H Preferred Shares shall not be entitled to share therein.

Section 5.Redemption at the Option of the Trust.

(a)The Trust, at its option, may redeem the Series H Preferred Shares in whole or in part, as set forth herein, subject to the provisions described below.

(b)The Series H Preferred Shares may be redeemed, in whole or in part, at the option of the Trust, at any time, only if for 20 Trading Days, within any period of 30 consecutive Trading Days, including the last Trading Day of such period, the Current Market Price of the Common Shares on each of such 20 Trading Days equals or exceeds the Conversion Price in effect on such Trading Day. In order to exercise its redemption option, the Trust must issue a press release announcing the redemption (the “Press Release”) prior to the opening of business on the second Trading Day after the condition in the preceding sentence has, from time to time, been met. The Press Release shall announce the redemption and set forth the number of Series H Preferred Shares which the Trust intends to redeem. The Call Date shall be selected by the Trust, shall be specified in the notice of redemption and shall be not less than 30 days or more than 60 days after the date on which the Trust issues the Press Release.

(c)Upon redemption of Series H Preferred Shares by the Trust on the date specified in the notice to holders required under subparagraph (e) of this Section 5 (the “Call Date”), each Series H Preferred Share so redeemed shall be converted into a number of Common Shares equal to the liquidation preference (excluding any accrued and unpaid dividends) of the Series H Preferred Shares being redeemed divided by the Conversion Price as of the opening of business on the Call Date.

Upon any redemption of Series H Preferred Shares, the Trust shall pay any accrued and unpaid dividends in arrears for any Dividend Period ending on or prior to the Call Date. If the Call Date falls after a dividend payment record date and prior to the corresponding Dividend Payment Date, then each holder of Series H Preferred Shares at the close of business on such

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dividend payment record date shall be entitled to the dividend payable on such shares on the corresponding Dividend Payment Date notwithstanding the redemption of such shares before such Dividend Payment Date. Except as provided above, the Trust shall make no payment or allowance for unpaid dividends, whether or not in arrears, on Series H Preferred Shares called for redemption or on the Common Shares issued upon such redemption.

(d)If full cumulative dividends on the Series H Preferred Shares and any other class or series of Parity Shares of the Trust have not been paid or declared and set apart for payment, the Series H Preferred Shares may not be redeemed in part and the Trust may not purchase or acquire Series H Preferred Shares, otherwise than pursuant to a purchase or exchange offer made on the same terms to all holders of Series H Preferred Shares.

(e)If the Trust shall redeem Series H Preferred Shares pursuant to paragraph (a) of this Section 5, notice of such redemption shall be given not more than four Business Days after the date on which the Trust issues the Press Release to each holder of record of the shares to be redeemed. Such notice shall be provided by first class mail, postage prepaid, at such holder’s address as the same appears on the share records of the Trust, or by publication in The Wall Street Journal or the New York Times, or if neither such newspaper is then being published, any other daily newspaper of national circulation. If the Trust elects to provide such notice by publication, it shall also promptly mail notice of such redemption to the holders of the Series H Preferred Shares to be redeemed. Neither the failure to mail any notice required by this paragraph (e), nor any defect therein or in the mailing thereof, to any particular holder, shall affect the sufficiency of the notice or the validity of the proceedings for redemption with respect to the other holders. Any notice which was mailed in the manner herein provided shall be conclusively presumed to have been duly given on the date mailed whether or not the holder receives the notice. Each such mailed or published notice shall state, as appropriate: (1) the Call Date; (2) the number of Series H Preferred Shares to be redeemed and, if fewer than all the shares held by such holder are to be redeemed, the number of such shares to be redeemed from such holder; (3) the number of Common Shares to be issued with respect to each Series H Preferred Share; (4) the place or places at which certificates for such shares are to be surrendered for certificates evidencing Common Shares; (5) the then-current Conversion Price; and (6) that dividends on the shares to be redeemed shall cease to accrue on such Call Date except as otherwise provided herein. Notice having been published or mailed as aforesaid, from and after the Call Date (unless the Trust shall fail to make available a number of Common Shares or amount of cash necessary to effect such redemption), (i) except as otherwise provided herein, dividends on the Series H Preferred Shares so called for redemption shall cease to accrue, (ii) said shares shall no longer be deemed to be outstanding, and (iii) all rights of the holders thereof as holders of Series H Preferred Shares of the Trust shall cease (except the rights to receive the Common Shares and cash payable upon such redemption, without interest thereon, upon surrender and endorsement of their certificates if so required and to receive any dividends payable thereon). The Trust’s obligation to provide Common Shares and cash in accordance with the preceding sentence shall be deemed fulfilled if, on or before the Call Date, the Trust shall deposit with a bank or trust company (which may be an affiliate of the Trust) that has an office in the Borough of Manhattan, City of New York, or in Chicago, Illinois and that has, or is an affiliate of a bank or trust company that has, a capital and surplus of at least $50,000,000, Common Shares and any cash necessary for such redemption, in trust, with irrevocable instructions that such Common Shares and cash be applied to the redemption of the Series H Preferred Shares so called for redemption. At the close of business on the Call Date, each holder of Series H Preferred Shares to

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be redeemed (unless the Trust defaults in the delivery of the Common Shares or cash payable on such Call Date) shall be deemed to be the record holder of the number of Common Shares into which such Series H Preferred Shares are to be redeemed, regardless of whether such holder has surrendered the certificates evidencing the Series H Preferred Shares. No interest shall accrue for the benefit of the holders of Series H Preferred Shares to be redeemed on any cash so set aside by the Trust. Subject to applicable escheat laws, any such cash unclaimed at the end of two years from the Call Date shall revert to the general funds of the Trust, after which reversion the holders of such shares so called for redemption shall look only to the general funds of the Trust for the payment of such cash.

As promptly as practicable after the surrender in accordance with said notice of the certificates for any such shares so redeemed (properly endorsed or assigned for transfer, if the Trust shall so require and if the notice shall so state), such shares shall be exchanged for certificates of Common Shares and any cash (without interest thereon) for which such shares have been redeemed. If fewer than all the outstanding Series H Preferred Shares are to be redeemed, shares to be redeemed shall be selected by the Trust from outstanding Series H Preferred Shares not previously called for redemption by lot or pro rata (as nearly as may be) or by any other method determined by the Board of Trustees of the Trust in its sole discretion to be equitable. If fewer than all the Series H Preferred Shares evidenced by any certificate are redeemed, then new certificates evidencing the unredeemed shares shall be issued without cost to the holder thereof.

(f)No fractional shares or scrip representing fractions of Common Shares shall be issued upon redemption of the Series H Preferred Shares. Instead of any fractional interest in a Common Share that would otherwise be deliverable upon the redemption of a Series H Preferred Share, the Trust shall pay to the holder of such share an amount in cash (computed to the nearest cent) based upon the Current Market Price of Common Shares on the Trading Day immediately preceding the Call Date. If more than one share shall be surrendered for redemption at one time by the same holder, the number of full Common Shares issuable upon redemption thereof shall be computed on the basis of the aggregate number of Series H Preferred Shares so surrendered.

(g)The Trust covenants that any Common Shares issued upon redemption of the Series H Preferred Shares shall be validly issued, fully paid and non-assessable. The Trust shall endeavor to list the Common Shares required to be delivered upon the redemption of the Series H Preferred Shares, prior to such redemption, upon each national securities exchange, if any, upon which the outstanding Common Shares are listed at the time of such delivery.

The Trust shall endeavor to take any action necessary to ensure that any Common Shares issued upon the redemption of Series H Preferred Shares are freely transferable and not subject to any resale restrictions under the Securities Act of 1933, as amended (the “Act”), or any applicable state securities or blue sky laws (other than any Common Shares issued upon redemption of any Series H Preferred Shares which are held by an “affiliate” (as defined in Rule 144 under the Act) of the Trust).

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Section 6.Shares To Be Retired.

All Series H Preferred Shares which shall have been issued and reacquired in any manner by the Trust shall be restored to the status of authorized but unissued Preferred Shares, without designation as to series.

Section 7.Conversion.

Holders of Series H Preferred Shares shall have the right to convert all or a portion of such Series H Preferred Shares into Common Shares, as follows:

(a)Subject to and upon compliance with the provisions of this Section 7, a holder of Series H Preferred Shares shall have the right, at his or her option, at any time to convert such shares into the number of fully paid and non-assessable Common Shares obtained by dividing the aggregate liquidation preference (excluding any accrued and unpaid dividends) of such shares by the Conversion Price (as in effect at the time and on the date provided for in the last paragraph of paragraph (b) of this Section 7) by surrendering such shares to be converted, such surrender to be made in the manner provided in Section 7 paragraph (b); provided, however, that the right to convert shares called for redemption pursuant to Section 5 shall terminate at the close of business on the Call Date fixed for such redemption, unless the Trust shall default in making payment of the Common Shares and any cash payable upon such redemption under Section 5 hereof.

(b)In order to exercise the conversion right, the holder of each Series H Preferred Share to be converted shall surrender the certificate evidencing such share, duly endorsed or assigned to the Trust or in blank, at the office of the Transfer Agent, accompanied by written notice to the Trust that the holder thereof elects to convert such Series H Preferred Shares.  Unless the shares issuable on conversion are to be issued in the same name as the name in which such Series H Preferred Share is registered, each share surrendered for conversion shall be accompanied by instruments of transfer, in form satisfactory to the Trust, duly executed by the holder or such holder’s duly authorized attorney and an amount sufficient to pay any transfer or similar tax (or evidence reasonably satisfactory to the Trust demonstrating that such taxes have been paid).

Holders of Series H Preferred Shares at the close of business on a dividend payment record date shall be entitled to receive the dividend payable on such shares on the corresponding Dividend Payment Date notwithstanding the conversion thereof following such dividend payment record date and prior to such Dividend Payment Date.  However, Series H Preferred Shares surrendered for conversion during the period between the close of business on any dividend payment record date and the opening of business on the corresponding Dividend Payment Date (except shares converted after the issuance of notice of redemption with respect to a Call Date during such period, such Series H Preferred Shares being entitled to such dividend on the Dividend Payment Date) must be accompanied by payment of an amount equal to the dividend payable on such shares on such Dividend Payment Date.  A holder of Series H Preferred Shares on a dividend payment record date who (or whose transferee) tenders any such shares for conversion into Common Shares on such Dividend Payment Date will receive the dividend payable by the Trust on such Series H Preferred Shares on such date, and the converting holder need not include payment of the amount of such dividend upon surrender of Series H Preferred Shares for conversion.  Except as provided above, the Trust shall make no payment or allowance for unpaid dividends, whether or

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not in arrears, on converted shares or for dividends on the Common Shares issued upon such conversion.

As promptly as practicable after the surrender of certificates for Series H Preferred Shares as aforesaid, the Trust shall issue and shall deliver at such office to such holder, or on his or her written order, a certificate for the number of full Common Shares issuable upon the conversion of such shares in accordance with provisions of this Section 7, and any fractional interest in respect of a Common Share arising upon such conversion shall be settled as provided in paragraph (c) of this Section 7.

Each conversion shall be deemed to have been effected immediately prior to the close of business on the date on which the certificates for Series H Preferred Shares shall have been surrendered and such notice (and if applicable, payment of an amount equal to the dividend payable on such shares) received by the Trust as aforesaid, and the person or persons in whose name or names any certificate or certificates for Common Shares shall be issuable upon such conversion shall be deemed to have become the holder or holders of record of the shares represented thereby at such time on such date and such conversion shall be at the Conversion Price in effect at such time on such date unless the share transfer books of the Trust shall be closed on that date, in which event such person or persons shall be deemed to have become such holder or holders of record at the close of business on the next succeeding day on which such share transfer books are open, but such conversion shall be at the Conversion Price in effect on the date on which such shares shall have been surrendered and such notice received by the Trust.

(c)No fractional shares or scrip representing fractions of Common Shares shall be issued upon conversion of the Series H Preferred Shares.  Instead of any fractional interest in a Common Share that would otherwise be deliverable upon the conversion of a Series H Preferred Share, the Trust shall pay to the holder of such share an amount in cash based upon the Current Market Price of a Common Share on the Trading Day immediately preceding the date of conversion.  If more than one share shall be surrendered for conversion at one time by the same holder, the number of full Common Shares issuable upon conversion thereof shall be computed on the basis of the aggregate number of Series H Preferred Shares so surrendered.

(d)The Conversion Price shall be adjusted from time to time as follows:

(i)If the Trust shall after the Issue Date (A) pay a dividend or make a distribution on its shares of beneficial interest of its Common Shares, (B) subdivide its outstanding Common Shares into a greater number of shares, (C) combine its outstanding Common Shares into a smaller number of shares or (D) issue any shares by reclassification of its Common Shares, the Conversion Price in effect at the opening of business on the day following the date fixed for the determination of shareholders entitled to receive such dividend or distribution or at the opening of business on the day following the day on which such subdivision, combination or reclassification becomes effective, as the case may be, shall be adjusted so that the holder of any Series H Preferred Share thereafter surrendered for conversion shall be entitled to receive the number of Common Shares that such holder would have owned or have been entitled to receive after the happening of any of the events described above had such Series H Preferred Share been converted immediately prior to the record date in the case of a dividend or distribution or the effective date in the case of a

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subdivision, combination or reclassification.  An adjustment made pursuant to this subparagraph (i) shall become effective immediately after the opening of business on the day next following the record date (except as provided in paragraph (h) below) in the case of a dividend or distribution and shall become effective immediately after the opening of business on the day next following the effective date in the case of a subdivision, combination or reclassification.

(ii)If the Trust shall issue after the Issue Date rights, options or warrants to all holders of Common Shares entitling them (for a period expiring within 45 days after the record date mentioned below) to subscribe for or purchase Common Shares at a price per share less than the Fair Market Value per Common Share on the record date for the determination of shareholders entitled to receive such rights or warrants, then the Conversion Price in effect at the opening of business on the day next following such record date shall be adjusted to equal the price determined by multiplying (I) the Conversion Price in effect immediately prior to the opening of business on the day following the date fixed for such determination by (II) a fraction, the numerator of which shall be the sum of (A) the number of Common Shares outstanding on the close of business on the date fixed for such determination and (B) the number of shares that the aggregate proceeds to the Trust from the exercise of such rights or warrants for Common Shares would purchase at such Fair Market Value, and the denominator of which shall be the sum of (A) the number of Common Shares outstanding on the close of business on the date fixed for such determination and (B) the number of additional Common Shares offered for subscription or purchase pursuant to such rights or warrants.  Such adjustment shall become effective immediately after the opening of business on the day next following such record date (except as provided in paragraph (h) below).  In determining whether any rights or warrants entitle the holders of Common Shares to subscribe for or purchase Common Shares at less than such Fair Market Value, there shall be taken into account any consideration received by the Trust upon issuance and upon exercise of such rights or warrants, the value of such consideration, if other than cash, to be determined by the Chief Executive Officer or the Board of Trustees.

(iii)If the Trust shall distribute to all holders of its Common Shares any shares of beneficial interest of the Trust (other than Common Shares) or evidence of its indebtedness or assets (excluding Permitted Common Share Cash Distributions) or rights or warrants to subscribe for or purchase any of its securities (excluding those rights and warrants issued to all holders of Common Shares entitling them for a period expiring within 45 days after the record date referred to in subparagraph (ii) above to subscribe for or purchase Common Shares, which rights and warrants are referred to in and treated under subparagraph (ii) above) (any of the foregoing being hereinafter in this subparagraph (iii) called the “Securities”), then in each such case the Conversion Price shall be adjusted so that it shall equal the price determined by multiplying (I) the Conversion Price in effect immediately prior to the close of business on the date fixed for the determination of shareholders entitled to receive such distribution by (II) a fraction, the numerator of which shall be the Fair Market Value per Common Share on the record date mentioned below less the then fair market value (as determined by the Chief Executive Officer or the Board of Trustees, whose determination shall be conclusive), of the portion of the shares or assets or evidences of indebtedness so distributed or of such rights or warrants applicable to one

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Common Share, and the denominator of which shall be the Fair Market Value per Common Share on the record date mentioned below.  Such adjustment shall become effective immediately at the opening of business on the Business Day next following (except as provided in paragraph (h) below) the record date for the determination of shareholders entitled to receive such distribution.  For the purposes of this clause (iii), the distribution of a Security, which is distributed not only to the holders of the Common Shares on the date fixed for the determination of shareholders entitled to such distribution of such Security, but also is distributed with each Common Share delivered to a Person converting a Series H Preferred Share after such determination date, shall not require an adjustment of the Conversion Price pursuant to this clause (iii); provided that on the date, if any, on which a person converting a Series H Preferred Share would no longer be entitled to receive such Security with a Common Share (other than as a result of the termination of all such Securities), a distribution of such Securities shall be deemed to have occurred and the Conversion Price shall be adjusted as provided in this clause (iii) and such day shall be deemed to be “the date fixed for the determination of the shareholders entitled to receive such distribution” and “the record date” within the meaning of the two preceding sentences.

(iv)No adjustment in the Conversion Price shall be required unless such adjustment would require a cumulative increase or decrease of at least 1% in such price; provided, however, that any adjustments that by reason of this subparagraph (iv) are not required to be made shall be carried forward and taken into account in any subsequent adjustment until made; and provided, further, that any adjustment shall be required and made in accordance with the provisions of this Section 7 (other than this subparagraph (iv)) not later than such time as may be required in order to preserve the tax-free nature of a distribution to the holders of Common Shares.  Notwithstanding any other provisions of this Section 7, the Trust shall not be required to make any adjustment of the Conversion Price for the issuance of any Common Shares pursuant to any plan providing for the reinvestment of dividends or interest payable on securities of the Trust and the investment of additional optional amounts in Common Shares under such plan.  All calculations under this Section 7 shall be made to the nearest cent (with $.005 being rounded upward) or to the nearest one-tenth of a share (with .05 of a share being rounded upward), as the case may be.  Anything in this paragraph (d) to the contrary notwithstanding, the Trust shall be entitled, to the extent permitted by law, to make such reductions in the Conversion Price, in addition to those required by this paragraph (d), as it in its discretion shall determine to be advisable in order than any share dividends, subdivision of shares, reclassification or combination of shares, distribution of rights or warrants to purchase shares or securities, or a distribution of other assets (other than cash dividends) hereafter made by the Trust to its shareholders shall not be taxable.

(e)If the Trust shall be a party to any transaction (including without limitation a merger, consolidation, statutory share exchange, self tender offer for all or substantially all Common Shares, sale of all or substantially all of the Trust’s assets or recapitalization of the Common Shares and excluding any transaction as to which subparagraph (d)(i) of this Section 7 applies) (each of the foregoing being referred to herein as a “Transaction”), in each case as a result of which Common Shares shall be converted into the right to receive shares, securities or other property (including cash or any combination thereof), each Series II Preferred Share which is not converted into the right to receive shares, securities or other property in connection with such

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Transaction shall thereafter be convertible into the kind and amount of shares, securities and other property (including cash or any combination thereof) receivable upon the consummation of such Transaction by a holder of that number of Common Shares into which one Series H Preferred Share was convertible immediately prior to such Transaction, assuming such holder of Common Shares (i) is not a Person with which the Trust consolidated or into which the Trust merged or which merged into the Trust or to which such sale or transfer was made, as the case may be (“Constituent Person”), or an affiliate of a Constituent Person and (ii) failed to exercise his rights of election, if any, as to the kind or amount of shares, securities and other property (including cash) receivable upon such Transaction (provided that if the kind or amount of shares, securities and other property (including cash) receivable upon such Transaction is not the same for each Common Share of the Trust held immediately prior to such Transaction by other than a Constituent Person or an affiliate thereof and in respect of which such rights of election shall not have been exercised (“Non-Electing Share”), then for the purpose of this paragraph (e) the kind and amount of shares, securities and other property (including cash) receivable upon such Transaction by each Non-Electing Share shall be deemed to be the kind and amount so receivable per share by a plurality of the non-electing shares).  The Trust shall not be a party to any Transaction unless the terms of such Transaction are consistent with the provisions of this paragraph (e), and it shall not consent or agree to the occurrence of any Transaction until the Trust has entered into an agreement with the successor or purchasing entity, as the case may be, for the benefit of the holders of the Series H Preferred Shares that will contain provisions enabling the holders of the Series H Preferred Shares that remain outstanding after such Transaction to convert into the consideration received by holders of Common Shares at the Conversion Price in effect immediately prior to such Transaction.  The provisions of this paragraph (e) shall similarly apply to successive Transactions.

(f)If:

(i)the Trust shall declare a dividend (or any other distribution) on the Common Shares (other than Permitted Common Share Cash Distributions); or

(ii)the Trust shall authorize the granting to the holders of the Common Shares of rights or warrants to subscribe for or purchase any shares of any class or any other rights or warrants; or

(iii)there shall be any reclassification of the Common Shares (other than an event to which subparagraph (d)(i) of this Section 7 applies) or any consolidation or merger to which the Trust is a party and for which approval of any shareholders of the Trust is required, or a statutory share exchange, or a self tender offer by the Trust for all or substantially all of its outstanding Common Shares or the sale or transfer of all or substantially all of the assets of the Trust as an entirety; or

(iv)there shall occur the voluntary or involuntary liquidation, dissolution or winding up of the Trust;

then the Trust shall cause to be filed with the Transfer Agent and shall cause to be mailed to the holders of Series H Preferred Shares at their addresses as shown on the share records of the Trust, as promptly as possible, but at least 15 days prior to the applicable date hereinafter specified, a notice stating (A) the date on which a record is to be

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taken for the purpose of such dividend or other distribution or grant of rights or warrants, or, if a record is not to be taken, the date as of which the holders of Common Shares of record to be entitled to such dividend or other distribution or rights or warrants are to be determined or (B) the date on which such reclassification, consolidation, merger, statutory share exchange, sale, transfer, liquidation, dissolution or winding up is expected to become effective, and the date as of which it is expected that holders of Common Shares of record shall be entitled to exchange their Common Shares for securities or other property, if any, deliverable upon such reclassification, consolidation, merger, statutory share exchange, sale, transfer, liquidation, dissolution or winding up.  Failure to give or receive such notice or any defect therein shall not affect the legality or validity of the proceedings described in this Section 7.

(g)Whenever the Conversion Price is adjusted as herein provided, the Trust shall promptly file with the Transfer Agent an officer’s certificate setting forth the Conversion Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment which certificate shall be conclusive evidence of the correctness of such adjustment absent manifest error.  Promptly after delivery of such certificate, the Trust shall prepare a notice of such adjustment of the Conversion Price setting forth the adjusted Conversion Price and the effective date that such adjustment becomes effective and shall mail such notice of such adjustment of the Conversion Price to the holder of each Series H Preferred Share at such holder’s last address as shown on the share records of the Trust.

(h)In any case in which paragraph (d) of this Section 7 provides that an adjustment shall become effective on the day next following the record date for an event, the Trust may defer until the occurrence of such event (A) issuing to the holder of any Series H Preferred Share converted after such record date and before the occurrence of such event the additional Common Shares issuable upon such conversion by reason of the adjustment required by such event over and above the Conversion Shares issuable upon such conversion before giving effect to such adjustment and (B) paying to such holder any amount of cash in lieu of any fraction pursuant to paragraph (c) of this Section 7.

(i)There shall be no adjustment of the Conversion Price in case of the issuance of any shares of the Trust in a reorganization, acquisition or other similar transaction except as specifically set forth in this Section 7.  If any action or transaction would require adjustment of the Conversion Price pursuant to more than one paragraph of this Section 7, only one adjustment shall be made and such adjustment shall be the amount of adjustment that has the highest absolute value.

(j)If the Trust shall take any action affecting the Common Shares, other than action described in this Section 7, that in the opinion of the Board of Trustees would materially adversely affect the conversion rights of the holders of the Series H Preferred Shares, the Conversion Price for the Series H Preferred Shares may be adjusted, to the extent permitted by law, in such manner, if any, and at such time, as the Board of Trustees, in its sole discretion, may determine to be equitable in the circumstances.

(k)The Trust covenants that it will at all times reserve and keep available, free from preemptive rights, out of the aggregate of its authorized but unissued Common Shares, for the purpose of effecting conversion of the Series H Preferred Shares, the full number of Common

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Shares deliverable upon the conversion of all outstanding Series H Preferred Shares not theretofore converted.  For purposes of this paragraph (k), the number of Common Shares that shall be deliverable upon the conversion of all outstanding Series H Preferred Shares shall be computed as if at the time of computation all such outstanding shares were held by a single holder.

The Trust covenants that any Common Shares issued upon conversion of the Series H Preferred Shares shall be validly issued, fully paid and non-assessable.

The Trust shall endeavor to list the Common Shares required to be delivered upon conversion of the Series H Preferred Shares, prior to such delivery, upon each national securities exchange, if any, upon which the outstanding Common Shares are listed at the time of such delivery.

Prior to the delivery of any securities that the Trust shall be obligated to deliver upon conversion of the Series H Preferred Shares, the Trust shall endeavor to comply with all federal and state laws and regulations thereunder requiring the registration of such securities with, or any approval of or consent to the delivery thereof by, any governmental authority.

(l)The Trust will pay any and all documentary stamp or similar issue or transfer taxes payable in respect of the issue or delivery of Common Shares or other securities or property on conversion of the Series H Preferred Shares pursuant hereto; provided, however, that the Trust shall not be required to pay any tax that may be payable in respect of any transfer involved in the issue or delivery of Common Shares or other securities or property in a name other than that of the holder of the Series H Preferred Shares to be converted, and no such issue or delivery shall be made unless and until the person requesting such issue or delivery has paid to the Trust the amount of any such tax or established, to the reasonable satisfaction of the Trust, that such tax has been paid.

Section 8.Ranking.  Any class or series of shares of the Trust shall be deemed to rank:

(a)Prior to the Series H Preferred Shares, as to the payment of dividends and as to distribution of assets upon liquidation, dissolution or winding up, if the holders of such class or series shall be entitled to the receipt of dividends or of amounts distributable upon liquidation, dissolution or winding up, as the case may be, in preference or priority to the holders of Series H Preferred Shares;

(b)On a parity with the Series H Preferred Shares, as to the payment of dividends and as to distribution of assets upon liquidation, dissolution or winding up, whether or not the dividend rates dividend payment dates or redemption or liquidation prices per share thereof be different from those of the Series H Preferred Shares, if the holders of such class of shares or series and the Series H Preferred Shares shall be entitled to the receipt of dividends and of amounts distributable upon liquidation, dissolution or winding up in proportion to their respective amounts of accrued and unpaid dividends per share or liquidation preferences, without preference or priority one over the other (“Parity Shares”), which Parity Shares include, as of the Issue Date, the Trust’s Series A Preferred Shares, Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares, Series E Preferred Shares, Series F Preferred Shares, Series G Preferred Shares, Series I Preferred Shares, Series J Preferred Shares, Series K Preferred Shares and Series L Preferred Shares; and

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(c)Junior to the Series H Preferred Shares, as to the payment of dividends or as to the distribution of assets upon liquidation, dissolution or winding up, if such shares or series shall be Common Shares or if the holders of Series H Preferred Shares shall be entitled to receipt of dividends or of amounts distributable upon liquidation, dissolution or winding up, as the case may be, in preference or priority to the holders of such shares or series.

Section 9.Voting.  If and whenever six quarterly dividends (whether or not consecutive) payable on the Series H Preferred Shares or any series or class of Parity Shares shall be in arrears (which shall, with respect to any such quarterly dividend, mean that any such dividend has not been paid in full), whether or not earned or declared, the number of trustees then constituting the Board of Trustees shall be increased by two and the holders of Series H Preferred Shares, together with the holders of every other series of Parity Shares (any such other series, the “Voting Preferred Shares”,) voting as a single class regardless of series, shall be entitled to elect the two additional trustees to serve on the Board of Trustees at any annual meeting of shareholders or special meeting held in place thereof, or at a special meeting of the holders of the Series H Preferred Shares and the Voting Preferred Shares called as hereinafter provided.  Whenever all arrears in dividends on the Series H Preferred Shares and the Voting Preferred Shares then outstanding shall have been paid and dividends thereon for the current quarterly dividend period shall have been paid or declared and set apart for payment, then the right of the holders of the Series H Preferred Shares and the Voting Preferred Shares to elect such additional two trustees shall cease (but subject always to the same provision for the vesting of such voting rights in the case of any similar future arrearages in six quarterly dividends), and the terms of office of all persons elected as trustees by the holders of the Series H Preferred Shares and the Voting Preferred Shares shall forthwith terminate and the number of the Board of Trustees shall be reduced accordingly.  At any time after such voting power shall have been so vested in the holders of Series H Preferred Shares and the Voting Preferred Shares, the secretary of the Trust may, and upon the written request of any holder of Series H Preferred Shares (addressed to the secretary at the principal office of the Trust) shall, call a special meeting of the holders of the Series H Preferred Shares and of the Voting Preferred Shares for the election of the two trustees to be elected by them as herein provided, such call to be made by notice similar to that provided in the Bylaws of the Trust for a special meeting of the shareholders or as required by law.  If any such special meeting required to be called as above provided shall not be called by the secretary within 20 days after receipt of any such request, then any holder of Series H Preferred Shares may call such meeting, upon the notice above provided, and for that purpose shall have access to the share books of the Trust.  The trustees elected at any such special meeting shall hold office until the next annual meeting of the shareholders or special meeting held in lieu thereof if such office shall not have previously terminated as above provided.  If any vacancy shall occur among the trustees elected by the holders of the Series H Preferred Shares and the Voting Preferred Shares, a successor shall be elected by the Board of Trustees, upon the nomination of the then-remaining trustee elected by the holders of the Series H Preferred Shares and the Voting Preferred Shares or the successor of such remaining trustee, to serve until the next annual meeting of the shareholders or special meeting held in place thereof if such office shall not have previously terminated as provided above.

So long as any Series H Preferred Shares are outstanding, in addition to any other vote or consent of shareholders required by law or by the Declaration of Trust, as amended, the affirmative vote of at least 66 2/3% of the votes entitled to be cast by the holders of the Series H

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Preferred Shares and the Voting Preferred Shares, at the time outstanding, acting as a single class regardless of series, given in person or by proxy, either in writing without a meeting or by vote at any meeting called for the purpose, shall be necessary for effecting or validating:

(a)Any amendment, alteration or repeal of any of the provisions of the Declaration of Trust that materially adversely affects the voting powers, rights or preferences of the holders of the Series H Preferred Shares or the Voting Preferred Shares; provided, however, that the amendment of the provisions of the Declaration of Trust so as to authorize or create, or to increase the authorized amount of, any Junior Shares or any shares of any class ranking on a parity with the Series H Preferred Shares or the Voting Preferred Shares shall not be deemed to materially adversely affect the voting powers, rights or preferences of the holders of Series H Preferred Shares, and provided further, that if any such amendment, alteration or repeal would materially adversely affect any voting powers, rights or preferences of the Series H Preferred Shares or another series of Voting Preferred Shares that are not enjoyed by some or all of the other series which otherwise would be entitled to vote in accordance herewith, the affirmative vote of at least 66 2/3% of the votes entitled to be cast by the holders of all series similarly affected, similarly given shall be required in lieu of the affirmative vote of at least 66 2/3% of the votes entitled to be cast by the holders of the Series H Preferred Shares and the Voting Preferred Shares which otherwise would be entitled to vote in accordance herewith; or

(b)The authorization or creation of, or the increase in the authorized amount of, any shares of any class or any security convertible into shares of any class ranking prior to the Series H Preferred Shares in the distribution of assets on any liquidation, dissolution or winding up of the Trust or in the payment of dividends; provided, however, that no such vote of the holders of Series H Preferred Shares shall be required if, at or prior to the time when such amendment, alteration or repeal is to take effect, or when the issuance of any such prior shares or convertible security is to be made, as the case may be, provision is made for the redemption of all Series H Preferred Shares at the time outstanding.

For purposes of the foregoing provisions of this Section 9, each Series H Preferred Share shall have one (1) vote per share, except that when any other series of Preferred Shares shall have the right to vote with the Series H Preferred Shares as a single class on any matter, then the Series H Preferred Shares and such other series shall have with respect to such matters one (1) vote per $25.00 of stated liquidation preference.  Except as otherwise required by applicable law or as set forth herein, the Series H Preferred Shares shall not have any voting rights and powers other than as set forth herein, and the consent of the holders thereof shall not be required for the taking of any trust action.

Section 10.Record Holders.  The Trust and the Transfer Agent may deem and treat the record holder of any Series H Preferred Shares as the true and lawful owner thereof for all purposes, and neither the Trust nor the Transfer Agent shall be affected by any notice to the contrary.

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SECTION 13.8.Series K Preferred Shares.

Section 1.Number of Shares and Designation.  This series of Preferred Shares shall be designated as Series K Cumulative Redeemable Preferred Shares of Beneficial Interest ($.01 Par Value Per Share)(Liquidation Preference $50.00 Per Share) (the “Series K Preferred Shares”) and 1,000,000 shall be the number of Preferred Shares constituting such series.

Section 2.Definitions.  For purposes of the Series K Preferred Shares, the following terms shall have the meanings indicated:

“Board of Trustees” shall mean the Board of Trustees of the Trust or any committee authorized by such Board of Trustees to perform any of its responsibilities with respect to the Series K Preferred Shares.

“Business Day” shall mean any day other than a Saturday, Sunday or a day on which state or federally chartered banking institutions in Chicago, Illinois or New York, New York are not required to be open.

“Call Date” shall have the meaning set forth in paragraph (c) of Section 5 hereof.

“Common Shares” shall mean the common shares of beneficial interest of the Trust, $.01 par value per share.

“Dividend Payment Date” shall mean the last calendar day of March, June, September and December, in each year, commencing on December 31, 1998; provided, however, that if any Dividend Payment Date falls on any day other than a Business Day, the dividend payment due on such Dividend Payment Date shall be paid no later than the Business Day immediately following such Dividend Payment Date.

“Dividend Periods” shall mean quarterly dividend periods commencing on January 1, April 1, July 1 and October 1 of each year and ending on and including the day preceding the first day of the next succeeding Dividend Period (other than the initial Dividend Period, which shall commence on the Issue Date and end on and include December 31, 1998).

“Issue Date” shall mean the date on which the Trust first issues a Series K Preferred Share.

“Junior Shares” shall mean the Common Shares and any other class or series of shares of the Trust over which the Series K Preferred Shares have preference or priority in the payment of dividends or in the distribution of assets on any liquidation, dissolution or winding up of the Trust.

“Parity Shares” shall have the meaning set forth in paragraph (b) of Section 8 hereof.

“Person” shall mean any individual, firm, partnership, corporation or other entity, and shall include any successor (by merger or otherwise) of such entity.

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“Press Release” shall have the meaning set forth in paragraph (b) of Section 5 hereof.

“Series K Preferred Shares” shall have the meaning set forth in Section 1 hereof.

“set apart for payment” shall be deemed to include, without any action other than the following, the recording by the Trust in its accounting ledgers of any accounting or bookkeeping entry which indicates, pursuant to an authorization of dividends or other distribution by the Board of Trustees, the allocation of funds to be so paid on any series or class of shares of beneficial interest of the Trust; provided, however, that if any funds for any class or series of Junior Shares or any class or series of shares ranking on a parity with the Series K Preferred Shares as to the payment of dividends are placed in a separate account of the Trust or delivered to a disbursing, paying or other similar agent, then “set apart for payment” with respect to the Series K Preferred Shares shall mean placing such funds in a separate account or delivering such funds to a disbursing, paying or other similar agent.

“Transfer Agent” means Boston Equiserve LP, Boston, Massachusetts, or such other agent or agents of the Trust as may be designated by the Board of Trustees or their designee as the transfer agent for the Series K Preferred Shares.

“Voting Preferred Shares” shall have the meaning set forth in Section 9 hereof.

Section 3.Dividends.  (a) The holders of Series K Preferred Shares shall be entitled to receive, when, as and if authorized by the Board of Trustees, out of funds legally available for that purpose, dividends payable in cash in an amount per Series K Preferred Share equal to $4.145 per annum.  Such dividends shall be cumulative from October 1, 1998, whether or not in any Dividend Period or Periods there shall be funds of the Trust legally available for the payment of such dividends, and shall be payable quarterly, when, as and if authorized by the Board of Trustees, in arrears on Dividend Payment Dates, commencing on December 31, 1998.  Each such dividend shall be payable in arrears to the holders of record of Series K Preferred Shares, as they appear on the share records of the Trust at the close of business on such record dates, which shall be on or about the 15^th day of the calendar months in which the Dividend Payment Dates fall or such other dates not less than 10 days nor more than 60 days proceeding such Dividend Payment Dates thereof, as shall be fixed by the Board of Trustees.  Accrued and unpaid dividends for any past Dividend Periods may be declared and paid at any time, without reference to any regular Dividend Payment Date, to holders of record on such date, not exceeding 45 days preceding the payment date thereof, as may be fixed by the Board of Trustees.

(b)The amount of dividends payable for each full Dividend Period for the Series K Preferred Shares shall be computed by dividing the annual dividend rate by four.  The amount of dividends payable for any period shorter or longer than a full Dividend Period, on the Series K Preferred Shares shall be computed on the basis of twelve 30-day months and a 360-day year.  Holders of Series K Preferred Shares shall not be entitled to any dividends, whether payable in cash, property or shares, in excess of cumulative dividends, as herein provided, on the Series K Preferred Shares.  No interest, or sum of money in lieu of interest, shall be payable in respect of any dividend payment or payments on the Series K Preferred Shares that may be in arrears.

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(c)So long as any Series K Preferred Shares are outstanding, no dividends, except as described in the immediately following sentence, shall be declared or paid or set apart for payment on any class or series of Parity Shares for any period unless full cumulative dividends have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for such payment on the Series K Preferred Shares for all Dividend Periods terminating on or prior to the Dividend Payment Date on such class or series of Parity Shares.  When dividends are not paid in full or a sum sufficient for such payment is not set apart, as aforesaid, all dividends declared upon Series K Preferred Shares and all dividends declared upon any other class or series of Parity Shares shall be declared ratably in proportion to the respective amounts of dividends accumulated and unpaid on the Series K Preferred Shares and accumulated and unpaid on such Parity Shares.

(d)So long as any Series K Preferred Shares are outstanding, no dividends (other than dividends or distributions paid in shares of, or options, warrants or rights to subscribe for or purchase, Junior Shares), shall be declared or paid or set apart for payment or other distribution declared or made upon Junior Shares, nor shall Junior Shares be redeemed, purchased or otherwise acquired (other than a redemption, purchase or other acquisition of Common Shares made for purposes of an employee incentive or benefit plan of the Trust or any subsidiary) for any consideration (or any moneys be paid to or made available for a sinking fund for the redemption of any such shares) by the Trust, directly or indirectly (except by conversion into or exchange for Junior Shares), unless in each case (i) the full cumulative dividends on all outstanding Series K Preferred Shares and any other Parity Shares of the Trust shall have been paid or set apart for payment for all past Dividend Periods with respect to the Series K Preferred Shares and all past dividend periods with respect to such Parity Shares and (ii) sufficient funds shall have been paid or set apart for the payment of the dividend for the current Dividend Period with respect to the Series K Preferred Shares and the current dividend period with respect to such Parity Shares.

Section 4.Liquidation Preference.  (a) In the event of any liquidation, dissolution or winding up of the Trust, whether voluntary or involuntary, before any payment or distribution of the assets of the Trust (whether capital or surplus) shall be made to or set apart for the holders of Junior Shares, the holders of the Series K Preferred Shares shall be entitled to receive Fifty Dollars ($50.00) per Series K Preferred Share plus an amount equal to all dividends (whether or not earned or declared) accrued and unpaid thereon to the date of final distribution to such holders; but such holders shall not be entitled to any further payment.  If, upon any liquidation, dissolution or winding up of the Trust, the assets of the Trust, or proceeds thereof, distributable among the holders of the Series K Preferred Shares shall be insufficient to pay in full the preferential amount aforesaid and liquidating payments on any other shares of any class or series of Parity Shares, then such assets, or the proceeds thereof, shall be distributed among the holders of Series K Preferred Shares and any such other Parity Shares ratably in accordance with the respective amounts that would be payable on such Series K Preferred Shares and any such other Parity Shares if all amounts payable thereon were paid in full.  For the purposes of this Section 4, (i) a consolidation or merger of the Trust with one or more entities, (ii) a sale or transfer of all or substantially all of the Trust’s assets, or (iii) a statutory share exchange shall not be deemed to be a liquidation, dissolution or winding up, voluntary or involuntary, of the Trust.

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(b)Subject to the rights of the holders of shares of any series or class or classes of shares ranking on a parity with or prior to the Series K Preferred Shares upon liquidation, dissolution or winding up, upon any liquidation, dissolution or winding up of the Trust, after payment shall have been made in full to the holders of the Series K Preferred Shares, as provided in this Section 4, any other series or class or classes of Junior Shares shall, subject to the respective terms and provisions (if any) applying thereto, be entitled to receive any and all assets remaining to be paid or distributed, and the holders of the Series K Preferred Shares shall not be entitled to share therein.

Section 5.Redemption at the Option of the Trust.  (a) The Series K Preferred Shares shall not be redeemable by the Trust prior to December 10, 2026.  On and after December 10, 2026, the Trust, at its option, may redeem the Series K Preferred Shares in whole or in part, as set forth herein, subject to the provisions described below.

(b)No Series K Preferred Share may be redeemed except from proceeds from the sale of other shares of beneficial interest of the Trust, including but not limited to Common Shares, Preferred Shares, depository shares, interests, participations or other ownership interests (however designated) and any rights (other than debt securities convertible into or exchangeable for equity securities) or options to purchase any of the foregoing.  In order to exercise its redemption option, the Trust must issue a press release announcing the redemption (the “Press Release”).  The Press Release shall announce the redemption and set forth the number of Series K Preferred Shares which the Trust intends to redeem.  The Call Date shall be selected by the Trust, shall be specified in the notice of redemption and shall be not less than 30 days or more than 60 days after the date on which the Trust issues the Press Release.

(c)Upon redemption of Series K Preferred Shares by the Trust on the date specified in the notice to holders required under subparagraph (e) of this Section 5 (the “Call Date”), for each Series K Preferred Share so redeemed, the Trust shall pay in cash the liquidation preference, including all dividends (whether or not earned or declared) accrued and unpaid thereon to the Call Date, except that if the Call Date falls after a dividend payment record date and prior to the corresponding Dividend Payment Date, then each holder of Series K Preferred Shares at the close of business on such dividend payment record date shall be entitled to the dividend payable on such shares on the corresponding Dividend Payment Date notwithstanding the redemption of such shares before such Dividend Payment Date.  Except as provided above, the Trust shall make no payment or allowance for unpaid dividends, whether or not in arrears, on Series K Preferred Shares called for redemption, after the date of redemption.

(d)If full cumulative dividends on the Series K Preferred Shares and any other class or series of Parity Shares of the Trust have not been paid or declared and set apart for payment, the Series K Preferred Shares may not be redeemed in part and the Trust may not purchase or acquire Series K Preferred Shares, otherwise than pursuant to a purchase or exchange offer made on the same terms to all holders of Series K Preferred Shares.

(e)If the Trust shall redeem Series K Preferred Shares pursuant to paragraph (a) of this Section 5, notice of such redemption shall be given not more than four Business Days after the date on which the Trust issues the Press Release to each holder of record of the shares to be redeemed.  Such notice shall be provided by first class mail, postage prepaid, at such holder’s

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address as the same appears on the share records of the Trust, or by publication in a newspaper of general circulation in the City of New York once per week for at least two successive weeks.  If the Trust elects to provide such notice by publication, it shall also promptly mail notice of such redemption to the holders of the Series K Preferred Shares to be redeemed not less than 30 nor more than 60 days prior to the Call Date. Neither the failure to mail any notice required by this paragraph (e), nor any defect therein or in the mailing thereof, to any particular holder, shall affect the sufficiency of the notice or the validity of the proceedings for redemption with respect to the other holders.  Any notice which was mailed in the manner herein provided shall be conclusively presumed to have been duly given on the date mailed whether or not the holder receives the notice.  Each such mailed or published notice shall state, as appropriate:  (1) the Call Date; (2) the number of Series K Preferred Shares to be redeemed and, if fewer than all the shares held by such holder are to be redeemed, the number of such shares to be redeemed for such holder; (3) the redemption price with respect to each Series K Preferred Share, including dividends accrued through the Call Date; (4) the place or places at which certificates for such shares are to be surrendered for payment; and (5) that dividends on the shares to be redeemed shall cease to accrue on such Call Date except as otherwise provided herein. Notice having been published or mailed as aforesaid, from and after the Call Date (unless the Trust shall fail to make available the amount of cash necessary to effect such redemption), (i) except as otherwise provided herein, dividends on the Series K Preferred Shares so called for redemption shall cease to accrue, (ii) said shares shall no longer be deemed to be outstanding, and (iii) all rights of the holders thereof as holders of Series K Preferred Shares of the Trust shall cease (except the rights to receive the cash payable upon such redemption, without interest thereon, upon surrender and endorsement of their certificates if so required and to receive any dividends payable thereon).  The Trust’s obligation to provide cash in accordance with the preceding sentence shall be deemed fulfilled if, on or before the Call Date, the Trust shall deposit with a bank or trust company (which may be an affiliate of the Trust) that has an office in the Borough of Manhattan, City of New York, or in Chicago, Illinois and that has, or is an affiliate of a bank or trust company that has, a capital and surplus of at least $50,000,000, cash necessary for such redemption, in trust, with irrevocable instructions that cash be applied to the redemption of the Series K Preferred Shares so called for redemption.  At the close of business on the Call Date, each holder of Series K Preferred Shares to be redeemed (unless the Trust defaults in the delivery of the cash payable on such Call Date) shall no longer be deemed to be the record holder of the number of such Series K Preferred Shares to be redeemed, regardless of whether such holder has surrendered the certificates evidencing the Series K Preferred Shares.  The Trust shall be entitled to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and the holders of any shares redeemed shall have no claim to such interest or other earnings. No interest shall accrue for the benefit of the holders of Series K Preferred Shares to be redeemed on the cash so set aside by the Trust.  Subject to applicable escheat laws, any such cash unclaimed at the end of two years from the Call Date shall revert to the general funds of the Trust, after which reversion the holders of such shares so called for redemption shall look only to the general funds of the Trust for the payment of such cash.

As promptly as practicable after the surrender in accordance with said notice of the certificates for any such shares so redeemed (properly endorsed or assigned for transfer, if the Trust shall so require and if the notice shall so state), the Trust shall pay the cash (without interest thereon) representing the redemption price for the redeemed shares.  If fewer than all the outstanding Series K Preferred Shares are to be redeemed, shares to be redeemed shall be selected by the Trust from outstanding Series K Preferred Shares not previously called for redemption by lot

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or pro rata (as nearly as may be ) or by any other method determined by the Trust in its sole discretion to be equitable.  If fewer than all the Series K Preferred Shares evidenced by any certificate are redeemed, then new certificates evidencing the unredeemed shares shall be issued without cost to the holder thereof.

Section 6.Shares To Be Retired.

All Series K Preferred Shares which shall have been issued and reacquired in any manner by the Trust shall be restored to the status of authorized but unissued Preferred Shares, without designation as to series.  The Trust may also reclassify any unissued Series K Preferred Shares, and such shares shall then be restored to the status of authorized but unissued Preferred Shares, without designation as to series.

Section 7.Conversion.

Holders of Series K Preferred Shares shall not have the right to convert all or a portion of such shares into Common Shares or any other class of shares of the Trust.

Section 8.Ranking.  Any class or series of shares of the Trust shall be deemed to rank:

(a)prior to the Series K Preferred Shares, as to the payment of dividends and as to distribution of assets upon liquidation, dissolution or winding up, if the holders of such class or series shall be entitled to the receipt of dividends or of amounts distributable upon liquidation, dissolution or winding up, as the case may be, in preference or priority to the holders of Series K Preferred Shares;

(b)on a parity with the Series K Preferred Shares, as to the payment of dividends and as to distribution of assets upon liquidation, dissolution or winding up, whether or not the dividend rates, dividend payment dates or redemption or liquidation prices per share thereof be different from those of the Series K preferred Shares, if the holders of such class of shares or series and the Series K Preferred Shares shall be entitled to the receipt of dividends and of amounts distributable upon liquidation, dissolution or winding up in proportion to their respective amounts of accrued and unpaid dividends per share or liquidation preferences, without preference or priority one over the other (“Parity Shares”), which Parity Shares include, as of the Issue Date, the Trust’s Series A Preferred Shares, Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares, Series E Preferred Shares, Series F Preferred Shares, Series G Preferred Shares, Series H Preferred Shares, Series I Preferred Shares, Series J Preferred Shares and Series L Preferred Shares; and

(c)junior to the Series K Preferred Shares, as to the payment of dividends or as to the distribution of assets upon liquidation, dissolution or winding up, if such shares or series shall be Common Shares or if the holders of Series K Preferred Shares shall be entitled to receipt of dividends or of amounts distributable upon liquidation, dissolution or winding up, as the case may be, in preference or priority to the holders of such shares or series.

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Section 9.Voting.  If and whenever six quarterly dividends (whether or not consecutive) payable on the Series K Preferred Shares or any series or class of Parity Shares shall be in arrears (which shall, with respect to any such quarterly dividend, mean that any such dividend has not been paid in full), whether or not earned or declared, the number of trustees then constituting the Board of Trustees shall be increased by two (if not already increased by reason of a similar arrearage with respect to any Parity Shares) and the holders of Series K Preferred Shares, together with the holders of shares of every other series of Parity Shares (any such other series, the “Voting Preferred Shares”), voting as a single class regardless of series, shall be entitled to elect the two additional trustees to serve on the Board of Trustees at any annual meeting of shareholders or special meeting held in place thereof, or at a special meeting of the holders of the Series K Preferred Shares and the Voting Preferred Shares called as hereinafter provided.  Whenever all arrears in dividends on the Series K Preferred Shares and the Voting Preferred Shares then outstanding shall have been paid and dividends thereon for the current quarterly dividend period shall have been paid or declared and set apart for payment, then the right of the holders of the Series K Preferred Shares and the Voting Preferred Shares to elect such additional two trustees shall cease (but subject always to the same provision for the vesting of such voting rights in the case of any similar future arrearages in six quarterly dividends), and the terms of office of all persons elected as trustees by the holders of the Series K Preferred Shares and the Voting Preferred Shares shall forthwith terminate and the number of the Board of Trustees shall be reduced accordingly.  At any time after such voting power shall have been so vested in the holders of Series K Preferred Shares and the Voting Preferred Shares, the secretary of the Trust may, and upon the written request of any holder of Series K Preferred Shares (addressed to the secretary at the principal office of the Trust) shall, call a special meeting of the holders of the Series K Preferred Shares and of the Voting Preferred Shares for the election of the two trustees to be elected by them as herein provided, such call to be made by notice similar to that provided in the Bylaws of the Trust for a special meeting of the shareholders or as required by law.  If any such special meeting required to be called as above provided shall not be called by the secretary within 20 days after receipt of any such request, then any holder of Series K Preferred Shares may call such meeting, upon the notice above provided, and for that purpose shall have access to the share books of the Trust.  The trustees elected at any such special meeting shall hold office until the next annual meeting of the shareholders or special meeting held in lieu thereof if such office shall not have previously terminated as above provided.  If any vacancy shall occur among the trustees elected by the holders of the Series K Preferred Shares and the Voting Preferred Shares, a successor shall be elected by the Board of Trustees, upon the nomination of the then-remaining trustee elected by the holders of the Series K Preferred Shares and the Voting Preferred Shares or the successor of such remaining trustee, to serve until the next annual meeting of the shareholders or special meeting held in place thereof if such office shall not have previously terminated as provided above.

So long as any Series K Preferred Shares are outstanding, in addition to any other vote or consent of shareholders required by law or by the Declaration of Trust, as amended, the affirmative vote of at least 66 2/3% of the votes entitled to be cast by the holders of the Series K Preferred Shares and the Voting Preferred Shares, at the time outstanding, acting as a single class regardless of series, given in person or by proxy, either in writing without a meeting or by vote at any meeting called for the purpose, shall be necessary for effecting or validating:

(a)Any amendment, alteration or repeal of any of the provisions of the Declaration of Trust that materially adversely affects the voting powers, rights or preferences of the

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holders of the Series K Preferred Shares or the Voting Preferred Shares; provided, however, that the amendment of the provisions of the Declaration of Trust so as to authorize or create, or to increase the authorized amount of, any Junior Shares or any shares of any class ranking on a parity with the Series K Preferred Shares or the Voting Preferred Shares shall not be deemed to materially adversely affect the voting powers, rights or preferences of the holders of Series K Preferred Shares, and provided further, that if any such amendment, alteration or repeal would materially adversely affect any voting powers, rights or preferences of the Series K Preferred Shares or another series of Voting Preferred Shares that are not enjoyed by some or all of the other series which otherwise would be entitled to vote in accordance herewith, the affirmative vote of at least 66 2/3% of the votes entitled to be cast by the holders of all series similarly affected, similarly given, shall be required in lieu of the affirmative vote of at least 66 2/3% of the votes entitled to be cast by the holders of the Series K Preferred Shares and the Voting Preferred Shares which otherwise would be entitled to vote in accordance herewith; or

(b)The authorization or creation of, or the increase in the authorized amount of, any shares of any class or any security convertible into shares of any class ranking prior to the Series K Preferred Shares in the distribution of assets on any liquidation, dissolution or winding up of the Trust or in the payment of dividends; provided, however, that no such vote of the holders of Series K Preferred Shares shall be required if, at or prior to the time when such amendment, alteration or repeal is to take effect, or when the issuance of any such prior shares or convertible security is to be made, as the case may be, provision is made for the redemption of all Series K Preferred Shares at the time outstanding.

For purposes of the foregoing provisions of this Section 9, each Series K Preferred Share shall have one (1) vote per share, except that when any other series of preferred shares shall have the right to vote with the Series K Preferred Shares as a single class on any matter, then the Series K Preferred Shares and such other series shall have with respect to such matters one (1) vote per $25.00 of stated liquidation preference.  Except as otherwise required by applicable law or as set forth herein, the Series K Preferred Shares shall not have any voting rights and powers other than as set forth herein, and the consent of the holders thereof shall not be required for the taking of any trust action.

Section 10.Record Holders.  The Trust and the Transfer Agent may deem and treat the record holder of any Series K Preferred Shares as the true and lawful owner thereof for all purposes, and neither the Trust nor the Transfer Agent shall be affected by any notice to the contrary.

SECTION 13.9.Series M Preferred Shares.

1.A.Certain Definitions.

Unless the context otherwise requires, the terms defined in this subparagraph A of paragraph 1 shall have, for all purposes of these terms of the Series M Preferred Shares, the meanings herein specified (with terms defined in the singular having comparable meanings when used in the plural).

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“Business Day” shall mean any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in New York City are authorized or required by law, regulation or executive order to close.

“Common Shares” shall mean the common shares of beneficial interest, $.01 par value per share, of the Trust.

“Distribution Period” shall have the meaning set forth in subparagraph (3) of paragraph B.

“Junior Shares” shall have the meaning set forth in subparagraph (2) of paragraph B.

“Person” shall mean an individual, corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code joint stock company or other entity, and also includes a group as that term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended; but does not include an underwriter which participates in a public offering of the Series M Preferred Shares provided that the ownership of Series M Preferred Shares by such Underwriter would not result in the Trust being “closely held” within the meaning of Section 856(h) of the Code, or would otherwise result in the Trust failing to qualify as a REIT.

“Preferred Shares” shall mean preferred shares of beneficial interest of the Trust, including Series A Preferred Shares, Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares, Series E Preferred Shares, Series F Preferred Shares, Series G Preferred Shares, Series H Preferred Shares, Series I Preferred Shares, Series J Preferred Shares, Series K Preferred Shares, Series L Preferred Shares, and Series M Preferred Shares, and any other shares designated as preferred in respect of rights to receive distributions and to participate in distributions or payments in the event of liquidation, dissolution, or winding up of the Trust, as may be issued and outstanding from time to time.

“Quarterly Distribution Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“Record Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“REIT” shall mean a Real Estate Investment Trust under Section 856 of the Code.

“Series M Redemption Date” shall have the meaning set forth in subparagraph (5) of paragraph B below.

“Series M Redemption Price” shall have the meaning set forth in subparagraph (5) of paragraph B below.

All other capitalized terms used but not defined herein shall have the meanings ascribed to them in the Declaration of Trust.

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B.Series M Preferred Shares

(1)Number and Designation.  A series of Preferred Shares, consisting of 800,000 Preferred Shares designated as 8.00% Series M Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $50.00 per share) (the “Series M Preferred Shares”), is hereby established.

(2)Ranking.  In respect of rights to receive distributions and to participate in distributions or payments in the event of any liquidation, dissolution or winding up of the Trust, the Series M Preferred Shares shall rank pari passu with any other Preferred Shares of the Trust, and will rank senior to the Common Shares and any other class or series of shares of beneficial interest of the Trust ranking, as to distributions and upon liquidation, junior (collectively, the “Junior Shares”) to the Preferred Shares.

(3)Distributions.  The holders of the then outstanding Series M Preferred Shares shall be entitled to receive, when and as declared by the Board of Trustees out of any funds legally available therefor, cumulative distributions at the rate of $4.00 per share per year, payable in equal amounts of $1.00 per share quarterly in cash on the fifteenth day, or if not a Business Day, the next succeeding Business Day, of January, April, July and October in each year, beginning October 15, 1999 (each such day being hereinafter called a “Quarterly Distribution Date” and each period ending on a Quarterly Distribution Date being hereinafter called a “Distribution Period”), to shareholders of record at the close of business on such date as shall be fixed by the Board of Trustees at the time of declaration of the distribution (the “Record Date”), which shall not be less than 10 nor more than 30 days preceding the Quarterly Distribution Date.  The amount of any distribution payable for the initial Distribution Period and for any other Distribution Period shorter than a full Distribution Period shall be prorated and computed on the basis of a 360-day year of twelve 30-day months.  Distributions on each Series M Preferred Share shall accrue and be cumulative from and including the date of original issue thereof, whether or not (i) distributions on such shares are earned or declared or (ii) on any Quarterly Distribution Date there shall be funds legally available for the payment of distributions.  Distributions paid on the Series M Preferred Shares in an amount less than the total amount of such distributions at the time accrued and payable on such shares shall be allocated pro rata on a per share basis among all such shares at the time outstanding.

The amount of any distributions accrued on any Series M Preferred Shares at any Quarterly Distribution Date shall be the amount of any unpaid distributions accumulated thereon, to and including such Quarterly Distribution Date, whether or not earned or declared, and the amount of distributions accrued on any Series M Preferred Shares at any date other than a Quarterly Distribution Date shall be equal to the sum of the amount of any unpaid distributions accumulated thereon, to and including the last preceding Quarterly Distribution Date, whether or not earned or declared, plus an amount calculated on the basis of the annual distribution rate of $4.00 for the period after such last preceding Quarterly Distribution Date to and including the date as of which the calculation is made based on a 360-day year of twelve 30-day months.

In determining whether a distribution (other than upon voluntary or involuntary liquidation), by dividend, redemption or other acquisition of shares of beneficial interest of the Trust or otherwise, is permitted under Maryland law, amounts that would be needed, if the Trust

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were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of holders of Series M Preferred Shares will not be added to the Trust’s total liabilities.

Except as provided in these terms of the Series M Preferred Shares, the Series M Preferred Shares shall not be entitled to participate in the earnings or assets of the Trust.

(4)Liquidation Rights.

(a)Upon the voluntary or involuntary dissolution, liquidation or winding up of the Trust, the holders of the Series M Preferred Shares then outstanding shall be entitled to receive and to be paid out of the assets of the Trust available for distribution to its shareholders, before any payment or distribution shall be made on any Junior Shares, the amount of $50.00 per Series M Preferred Share, plus accrued and unpaid distributions thereon.

(b)After the payment to the holders of the Series M Preferred Shares of the full preferential amounts provided for in this paragraph B, the holders of the Series M Preferred Shares as such shall have no right or claim to any of the remaining assets of the Trust.

(c)If, upon any voluntary or involuntary dissolution, liquidation, or winding up of the Trust, the amounts payable with respect to the preference value of the Series M Preferred Shares and any other shares of beneficial interest of the Trust ranking as to any such distribution on a parity with the Series M Preferred Shares are not paid in full, the holders of the Series M Preferred Shares and of such other shares will share ratably in any such distribution of assets of the Trust in proportion to the full respective preference amounts to which they are entitled.

(d)Neither the sale of all or substantially all the property or business of the Trust, nor the merger or consolidation of the Trust into or with any other entity or the merger or consolidation of any other entity into or with the Trust, shall be deemed to be a dissolution, liquidation or winding up, voluntary or involuntary, for the purposes of this paragraph B.

(5)Redemption.

(a)Optional Redemption.  On and after October 1, 2004, the Trust may, at its option, redeem at any time all or, from time to time, part of the Series M Preferred Shares at a price per share (the “Series M Redemption Price”), payable in cash, of $50.00 per Series M Preferred Share, together with all accrued and unpaid distributions to and including the date fixed for redemption (the “Series M Redemption Date”).

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(b)Procedures for Redemption.

(i)Notice of any redemption will be mailed by the Trust, postage prepaid, not less than 30 days nor more than 60 days prior to the Series M Redemption Date, addressed to the holders of record of the Series M Preferred Shares to be redeemed at their addresses as they appear on the share transfer records of the Trust.  No failure to give such notice or any defect therein or in the mailing thereof shall affect the validity of the proceedings for the redemption of any Series M Preferred Shares except as to the holder to whom the Trust has failed to give notice or except as to the holder to whom notice was defective.  In addition to any information required by law or by the applicable rules of any exchange upon which Series M Preferred Shares may be listed or admitted to trading, such notice shall state: (a) the Series M Redemption Date; (b) the Series M Redemption Price; (c) the number of Series M Preferred Shares to be redeemed; (d) the place or places where certificates for such shares are to be surrendered for payment of the Series M Redemption Price; and (e) that distributions on the shares to be redeemed will cease to accumulate on the Series M Redemption Date.

(ii)If notice has been mailed in accordance with subparagraph (5)(b)(i) above and provided that on or before the Series M Redemption Date specified in such notice all funds necessary for such redemption shall have been irrevocably set aside by the Trust, separate and apart from its other funds in trust for the pro rata benefit of the holders of the Series M Preferred Shares so called for redemption, so as to be, and to continue to be available therefor, then, from and after the Series M Redemption Date, distributions on the Series M Preferred Shares so called for redemption shall cease to accumulate, and said shares shall no longer be deemed to be outstanding and shall not have the status of Series M Preferred Shares and all rights of the holders thereof as shareholders of the Trust (except the right to receive the Series M Redemption Price) shall cease.  Upon surrender, in accordance with said notice, of the certificates for any Series M Preferred Shares so redeemed (properly endorsed or assigned for transfer, if the Trust shall so require and the notice shall so state), such Series M Preferred Shares shall be redeemed by the Trust at the Series M Redemption Price.  In case fewer than all the Series M Preferred Shares evidenced by any such certificate are redeemed, a new certificate or certificates shall be issued evidencing the unredeemed Series M Preferred Shares without cost to the holder thereof.

(iii)Any funds deposited with a bank or trust company for the purpose of redeeming Series M Preferred Shares shall be irrevocable except that:

(A)the Trust shall be entitled to receive from such bank or trust company the interest or other earnings, if any,

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earned on any money so deposited in trust, and the holders of any shares redeemed shall have no claim to such interest or other earnings; and

(B)any balance of monies so deposited by the Trust and unclaimed by the holders of the Series M Preferred Shares entitled thereto at the expiration of two years from the applicable Series M Redemption Date shall be repaid, together with any interest or other earnings earned thereon, to the Trust, and after any such repayment, the holders of the shares entitled to the funds so repaid to the Trust shall look only to the Trust for payment without interest or other earnings.

(iv)No Series M Preferred Shares may be redeemed except with funds legally available for the payment of the Series M Redemption Price.

(v)Unless full accumulated distributions on all Series M Preferred Shares shall have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past Distribution Periods and the then current Distribution Period, no Series M Preferred Shares shall be redeemed (unless all outstanding Series M Preferred Shares are simultaneously redeemed) or purchased or otherwise acquired directly or indirectly (except by conversion into or exchange for shares of beneficial interest of the Trust ranking junior to the Series M Preferred Shares as to distributions and upon liquidation); provided, however, that the foregoing shall not prevent the redemption of Series M Preferred Shares pursuant to Article VII of the Declaration of Trust or the purchase or acquisition of Series M Preferred Shares pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding Series M Preferred Shares.

(vi)If the Series M Redemption Date is after a Record Date and before the related Quarterly Distribution Date, the distribution payable on such Quarterly Distribution Date shall be paid to the holder in whose name the Series M Preferred Shares to be redeemed are registered at the close of business on such Record Date notwithstanding the redemption thereof between such Record Date and the related Quarterly Distribution Date or the Trust’s default in the payment of the distribution due.

(vii)In case of redemption of less than all Series M Preferred Shares at the time outstanding, the Series M Preferred Shares to be redeemed shall be selected pro rata from the holders of record of such shares in proportion to the number of Series M Preferred Shares held by such holders (with adjustments to avoid redemption of fractional shares) or by any other equitable method determined by the Trust.

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(6)Voting Rights.Except as provided in these terms of the Series M Preferred Shares, the holders of the Series M Preferred Shares shall not be entitled to vote at any meeting of the shareholders for election of trustees or for any other purposes or otherwise to participate in any action taken by the Trust or the shareholders thereof, or to receive notice (except for such notice as required by law) of any meeting of shareholders.

(a)In any matter in which the Series M Preferred Shares are entitled to vote (as expressly provided herein), including any action by written consent, each Series M Preferred Share shall be entitled to 10 votes, each of which 10 votes may be directed separately by the holder thereof (or by any proxy or proxies of such holder).  With respect to each Series M Preferred Share, the holder thereof may designate up to 10 proxies, with each such proxy having the right to vote a whole number of votes (totaling 10 votes per Series M Preferred Share).

(b)Whenever distributions on any Series M Preferred Shares shall be in arrears for six or more quarterly periods, the holders of such Series M Preferred Shares, voting separately as a class with all other series of Preferred Shares upon which like voting rights have been conferred and are exercisable, will be entitled to vote for the election of two additional Trustees of the Trust at a special meeting called by the holders of record of at least ten percent (10%) of any series of Preferred Shares so in arrears (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the shareholders) or at the next annual meeting of shareholders, and at each subsequent annual meeting until all distributions accumulated on such Series M Preferred Shares for the past distribution periods and the then current distribution period shall have been fully paid or declared and a sum sufficient for the payment thereof set aside for payment.  In such case, the entire Board of Trustees of the Trust will increase by two Trustees.

(c)So long as any Series M Preferred Shares remain outstanding, the Trust will not, without the affirmative vote or consent of the holders of at least two-thirds of the Series M Preferred Shares outstanding at the time, given in person or by proxy, either in writing or at a meeting (such series voting separately as a class), (i) authorize or create, or increase the authorized or issued amount of, any class or series of shares of beneficial interest ranking prior to the Series M Preferred Shares with respect to the payment of distributions or the distribution of assets upon liquidation, dissolution or winding up or reclassify any authorized shares of beneficial interest of the Trust into such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or (ii) amend, alter or repeal the provisions of the Trust’s Declaration of Trust or the terms of the Series M Preferred Shares whether by merger, consolidation or otherwise (an “Event”), so as to materially

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and adversely affect any right, preference, privilege or voting power of the Series M Preferred Shares or the holders thereof; provided, however, with respect to the occurrence of any Events set forth in (ii) above, so long as the Series M Preferred Shares remain outstanding with the terms thereof materially unchanged, taking into account that upon the occurrence of an Event, the Trust may not be the surviving entity or the Series M Preferred Shares that remain outstanding may bear a new title, designation and/or be issued by a different issuer, the occurrence of any such Event shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting power of holders of Series M Preferred Shares and provided further that (x) any increase in the amount of the authorized Preferred Shares or the creation or issuance of any other Series M Preferred Shares, or (y) any increase in the amount of authorized Series M Preferred Shares or any other Preferred Shares, in each case ranking on a parity with or junior to the Series M Preferred Shares with respect to payment of distributions or the distribution of assets upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting powers.

The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding Series M Preferred Shares shall have been redeemed or called for redemption and sufficient funds shall have been deposited in trust to effect such redemption.

(7)Conversion.The Series M Preferred Shares are not convertible into or exchangeable for any other property or securities of the Trust, except into Excess Shares in connection with maintaining the ability of the Trust to qualify as a REIT.

C.Restrictions on Transfer.The Series M Preferred Shares shall be subject to the restrictions on transfer and ownership of Shares in Article VII of the Declaration of Trust, as supplemented below.

(1)Certain Definitions.

For purposes of the Series M Preferred Shares the following terms shall have the following meanings:

“Closing Date of the Series M Preferred Shares Offering” shall mean the time and date of payment for and delivery of Series M Preferred Shares issued pursuant to the exchange of Series A Cumulative Convertible Redeemable Preference Interests in EQR-Mosaic, LLC.

“Special Triggering Event” shall mean either (i) the redemption or purchase by the Trust of all or a portion of the outstanding shares of beneficial interest in the Trust, or (ii) a change in the value of the Series M Preferred Shares relative to any other class of beneficial interest in the Trust.

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(2)Special Triggering Event.If during the period commencing on the Closing Date of the Series M Preferred Shares Offering and prior to the Restriction Termination Date, a Special Triggering Event (if effective) or other event or occurrence (if effective) would result in any violation of section 7.2(a) of the Trust’s Declaration of Trust (or would result in the Trust being “closely held” within the meaning of Section 856(h) of the Code or would otherwise cause the Trust to fail to qualify as a REIT), then (i) the number of Series M Preferred Shares (rounded up to the nearest whole share) that would (but for this section) cause any Person to Beneficially Own either Series M Preferred Shares, or to Beneficially Own Series M Preferred Shares and any other shares of beneficial interest in the Trust, in violation of section 7.2(a) (or would result in the Trust being “closely held” or otherwise fail to qualify as a REIT) shall constitute “Excess Shares” and shall be treated as provided in Article VII.  Such designation and treatment shall be effective as of the close of business on the Business Day prior to the date of the Special Triggering Event or other event or occurrence.

(3)Ambiguity. In the case of an ambiguity in the application of any of the provisions of this section, including any definition contained in paragraph (1), the Board of Trustees shall have the power to determine the application of this section with respect to any situation based on the facts known to it (subject, however, to the provisions of Section 7.2(a)).

(4)Exclusion of Other Rights.

The Series M Preferred Shares shall not have any voting powers, preferences and relative, participating, optional or other special rights, other than those specifically set forth in these terms of the Series M Preferred Shares (as such terms may be amended from time to time) and in the Declaration of Trust.  The Series M Preferred Shares shall have no preemptive or subscription rights.

(5)Headings of Subdivisions.

The headings of the various subdivisions hereof are for convenience of reference only and shall not affect the interpretation of any of the provisions hereof.

(6)Severability of Provisions.

If any voting powers, preferences and relative, participating, optional and other special rights of the Series M Preferred Shares and qualifications, limitations and restrictions thereof set forth in these terms of the Series M Preferred Shares (as such terms may be amended from time to time) is invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, all other voting powers, preferences and relative, participating, optional and other special rights of Series M Preferred Shares and qualifications, limitations and restrictions thereof set forth in these terms of the Series M Preferred Shares (as so amended) which can be given effect without the invalid, unlawful or unenforceable voting powers, preferences, and relative, participating, optional or other special rights of Series M Preferred Shares and qualifications, limitations and restrictions thereof herein set forth, shall nevertheless, remain in full force and effect and no preferences or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of the Series M Preferred Shares herein set forth shall be deemed dependent upon any other such voting powers, preferences and

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relative, participating, optional or other special right of Series M Preferred Shares and qualifications, limitations and restrictions thereof unless so expressed herein.

SECTION 13.10.            Series M-1 Preferred Shares.

1.A.Certain Definitions.

Unless the context otherwise requires, the terms defined in this subparagraph A of paragraph 1 shall have, for all purposes of these terms of the Series M-1 Preferred Shares, the meanings herein specified (with terms defined in the singular having comparable meanings when used in the plural).

“Business Day” shall mean any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in New York City are authorized or required by law, regulation or executive order to close.

“Common Shares” shall mean the common shares of beneficial interest, $.01 par value per share, of the Trust.

“Distribution Period” shall have the meaning set forth in subparagraph (3) of paragraph B.

“Junior Shares” shall have the meaning set forth in subparagraph (2) of paragraph B.

“Person” shall mean an individual, corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code joint stock company or other entity, and also includes a group as that term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended; but does not include an underwriter which participates in a public offering of the Series M-1 Preferred Shares provided that the ownership of Series M-1 Preferred Shares by such Underwriter would not result in the Trust being “closely held” within the meaning of Section 856(h) of the Code, or would otherwise result in the Trust failing to qualify as a REIT.

“Preferred Shares” shall mean shares of beneficial interest of the Trust designated as or otherwise on a parity with the Series M-1 Preferred Shares as to distributions and rights upon voluntary or involuntary liquidation, winding up or dissolution of the Trust as may be issued and outstanding from time to time, including Series A Preferred Shares and Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares, Series E Preferred Shares, Series F Preferred Shares, Series G Preferred Shares, Series H Preferred Shares, Series J Preferred Shares, Series K Preferred Shares, Series L Preferred Shares, Series M Preferred Shares, and any other shares so designated.

“Quarterly Distribution Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

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“Record Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“REIT” shall mean a Real Estate Investment Trust under Section 856 of the Code.

“Series M-1 Redemption Date” shall have the meaning set forth in subparagraph (5) of paragraph B below.

“Series M-1 Redemption Price” shall have the meaning set forth in subparagraph (5) of paragraph B below.

All other capitalized terms used but not defined herein shall have the meanings ascribed to them in the Declaration of Trust.

B.            Series M-1 Preferred Shares

(1)             Number and Designation.  A series of Preferred Shares, consisting of 1,320,000 Preferred Shares designated as 8.50% Series M-1 Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $50.00 per share) (the “Series M-1 Preferred Shares”), is hereby established.

(2)             Ranking.  In respect of rights to receive distributions and to participate in distributions or payments in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Trust, the Series M-1 Preferred Shares shall rank pari passu with any other Preferred Shares of the Trust, and will rank senior to the Common Shares and any other class or series of shares of beneficial interest of the Trust ranking, as to distributions and upon liquidation, junior (collectively, the “Junior Shares”) to the Preferred Shares.

(3)             Distributions.  The holders of the then outstanding Series M-1 Preferred Shares shall be entitled to receive, when and as authorized by the Board of Trustees and declared by the Trust out of any funds legally available therefor, cumulative distributions at the rate of $4.25 per share per year, payable in equal amounts of $1.0625 per share quarterly in arrears in cash on the fifteenth day, or if not a Business Day, the next succeeding Business Day, of January, April, July and October in each year (each such day being hereinafter called a “Quarterly Distribution Date” and each period ending on a Quarterly Distribution Date being hereinafter called a “Distribution Period”), beginning on the first Quarterly Distribution Date following the issuance of the Series M-1 Preferred Shares, to shareholders of record at the close of business on such date as shall be fixed by the Board of Trustees at the time of declaration of the distribution (the “Record Date”), which shall not be less than 10 nor more than 30 days preceding the Quarterly Distribution Date.  The amount of any distribution payable for the initial Distribution Period and for any other Distribution Period shorter than a full Distribution Period shall be prorated and computed on the basis of a 360-day year of twelve 30-day months.  Distributions on each Series M-1 Preferred Share shall accrue and be cumulative from and including the date of original issue thereof, whether or not (i) distributions on such shares are earned or declared or (ii) on any Quarterly Distribution Date there shall be funds legally available for the payment of distributions.  Distributions paid on the Series M-1 Preferred Shares in an amount less than the total amount of such distributions at the

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time accrued and payable on such shares shall be allocated pro rata on a per share basis among all such shares at the time outstanding.

The amount of any distributions accrued on any Series M-1 Preferred Shares at any Quarterly Distribution Date shall be the amount of any unpaid distributions accumulated thereon, to and including such Quarterly Distribution Date, whether or not earned or declared, and the amount of distributions accrued on any Series M-1 Preferred Shares at any date other than a Quarterly Distribution Date shall be equal to the sum of the amount of any unpaid distributions accumulated thereon, to and including the last preceding Quarterly Distribution Date, whether or not earned or declared, plus an amount calculated on the basis of the annual distribution rate of $4.25 for the period after such last preceding Quarterly Distribution Date to and including the date as of which the calculation is made based on a 360-day year of twelve 30-day months.

In determining whether a distribution (other than upon voluntary or involuntary liquidation), by dividend, redemption or other acquisition of shares of beneficial interest of the Trust or otherwise, is permitted under Maryland law, amounts that would be needed, if the Trust were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of holders of Series M-1 Preferred Shares will not be added to the Trust’s total liabilities.

Except as provided in these terms of the Series M-1 Preferred Shares, the Series M-1 Preferred Shares shall not be entitled to participate in the earnings or assets of the Trust.

(4)           Liquidation Rights.

(a)Upon the voluntary or involuntary dissolution, liquidation or winding up of the Trust, the holders of the Series M-1 Preferred Shares then outstanding shall be entitled to receive and to be paid out of the assets of the Trust available for distribution to its shareholders, before any payment or distribution shall be made on any Junior Shares, the amount of $50.00 per Series M-1 Preferred Share, plus accrued and unpaid distributions thereon.

(b)After the payment to the holders of the Series M-1 Preferred Shares of the full preferential amounts provided for in this paragraph B, the holders of the Series M-1 Preferred Shares as such shall have no right or claim to any of the remaining assets of the Trust.

(c)If, upon any voluntary or involuntary dissolution, liquidation, or winding up of the Trust, the amounts payable with respect to the preference value of the Series M-1 Preferred Shares and any other shares of beneficial interest of the Trust ranking as to any such distribution on parity with the Series M-1 Preferred Shares are not paid in full, the holders of the Series M-1 Preferred Shares and of such other shares will share ratably in any such distribution of assets of the Trust in proportion to the full respective preference amounts to which they are entitled.

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(d)Neither the sale of all or substantially all the property or business of the Trust, nor the merger or consolidation of the Trust into or with any other entity or the merger or consolidation of any other entity into or with the Trust, shall be deemed to be a dissolution, liquidation or winding up, voluntary or involuntary, for the purposes of this paragraph B.

(5)                   Redemption.

(a)Optional Redemption.  On and after March 3, 2005, the Trust may, at its option, redeem at any time all or, from time to time, part of the Series M-1 Preferred Shares at a price per share (the “Series M-1 Redemption Price”), payable in cash, of $50.00 per Series M-1 Preferred Share, together with all accrued and unpaid distributions to and including the date fixed for redemption (the “Series M-1 Redemption Date”).

(b)Procedures for Redemption.

(i)      Notice of any redemption will be mailed by the Trust, postage prepaid, not less than 30 days nor more than 60 days prior to the Series M-1 Redemption Date, addressed to the holders of record of the Series M-1 Preferred Shares to be redeemed at their addresses as they appear on the share transfer records of the Trust.  No failure to give such notice or any defect therein or in the mailing thereof shall affect the validity of the proceedings for the redemption of any Series M-1 Preferred Shares except as to the holder to whom the Trust has failed to give notice or except as to the holder to whom notice was defective.  In addition to any information required by law or by the applicable rules of any exchange upon which Series M-1 Preferred Shares may be listed or admitted to trading, such notice shall state: (a) the Series M-1 Redemption Date; (b) the Series M-1 Redemption Price; (c) the number of Series M-1 Preferred Shares to be redeemed; (d) the place or places where certificates for such shares are to be surrendered for payment of the Series M-1 Redemption Price; and (e) that distributions on the shares to be redeemed will cease to accumulate on the Series M-1 Redemption Date.

(ii)     If notice has been mailed in accordance with subparagraph (5)(b)(i) above and provided that on or before the Series M-1 Redemption Date specified in such notice all funds necessary for such redemption shall have been irrevocably set aside by the Trust, separate and apart from its other funds in trust for the pro rata benefit of the holders of the Series M-1 Preferred Shares so called for redemption, so as to be, and to continue to be available therefor, then, from and after the Series M-1 Redemption Date, distributions on the Series M-1 Preferred Shares so called for redemption shall cease to accumulate, and said shares shall no longer be deemed to be

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outstanding and shall not have the status of Series M-1 Preferred Shares and all rights of the holders thereof as shareholders of the Trust (except the right to receive the Series M-1 Redemption Price) shall cease.  Upon surrender, in accordance with said notice, of the certificates for any Series M-1 Preferred Shares so redeemed (properly endorsed or assigned for transfer, if the Trust shall so require and the notice shall so state), such Series M-1 Preferred Shares shall be redeemed by the Trust at the Series M-1 Redemption Price.  In case fewer than all the Series M-1 Preferred Shares evidenced by any such certificate are redeemed, a new certificate or certificates shall be issued evidencing the unredeemed Series M-1 Preferred Shares without cost to the holder thereof.

(iii)    Any funds deposited with a bank or trust company for the purpose of redeeming Series M-1 Preferred Shares shall be irrevocable except that:

(A)the Trust shall be entitled to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and the holders of any shares redeemed shall have no claim to such interest or other earnings; and

(B)any balance of monies so deposited by the Trust and unclaimed by the holders of the Series M-1 Preferred Shares entitled thereto at the expiration of two years from the applicable Series M-1 Redemption Date shall be repaid, together with any interest or other earnings earned thereon, to the Trust, and after any such repayment, the holders of the shares entitled to the funds so repaid to the Trust shall look only to the Trust for payment without interest or other earnings.

(iv)    No Series M-1 Preferred Shares may be redeemed except with funds legally available for the payment of the Series M-1 Redemption Price.

(v)     Unless full accumulated distributions on all Series M-1 Preferred Shares shall have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past Distribution Periods and the then current Distribution Period, no Series M-1 Preferred Shares shall be redeemed (unless all outstanding Series M-1 Preferred Shares are simultaneously redeemed) or purchased or otherwise acquired directly or indirectly (except by conversion into or exchange for shares of beneficial interest of the Trust

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ranking junior to the Series M-1 Preferred Shares as to distributions and upon liquidation); provided, however, that the foregoing shall not prevent the redemption of Series M-1 Preferred Shares pursuant to Article VII of the Declaration of Trust or the purchase or acquisition of Series M-1 Preferred Shares pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding Series M-1 Preferred Shares.

(vi)    If the Series M-1 Redemption Date is after a Record Date and before the related Quarterly Distribution Date, the distribution payable on such Quarterly Distribution Date shall be paid to the holder in whose name the Series M-1 Preferred Shares to be redeemed are registered at the close of business on such Record Date notwithstanding the redemption thereof between such Record Date and the related Quarterly Distribution Date or the Trust’s default in the payment of the distribution due.

(vii)   In case of redemption of less than all Series M-1 Preferred Shares at the time outstanding, the Series M-1 Preferred Shares to be redeemed shall be selected pro rata from the holders of record of such shares in proportion to the number of Series M-1 Preferred Shares held by such holders (with adjustments to avoid redemption of fractional shares) or by any other equitable method determined by the Trust.

(6)               Voting Rights.  Except as provided in these terms of the Series M-1 Preferred Shares, the holders of the Series M-1 Preferred Shares shall not be entitled to vote at any meeting of the shareholders for election of trustees or for any other purposes or otherwise to participate in any action taken by the Trust or the shareholders thereof, or to receive notice (except for such notice as required by law) of any meeting of shareholders.

(a)In any matter in which the Series M-1 Preferred Shares are entitled to vote (as expressly provided herein), including any action by written consent, each Series M-1 Preferred Share shall be entitled to 10 votes, each of which 10 votes may be directed separately by the holder thereof (or by any proxy or proxies of such holder).  With respect to each Series M-1 Preferred Share, the holder thereof may designate up to 10 proxies, with each such proxy having the right to vote a whole number of votes (totaling 10 votes per Series M-1 Preferred Share).

(b)Whenever distributions on any Series M-1 Preferred Shares shall be in arrears for six or more quarterly periods, the Board of Trustees of the Trust shall be increased by the two trustees and the holders of such Series M-1 Preferred Shares, voting separately as a class with all other series of Preferred Shares upon which like voting rights have been conferred and are exercisable, will be entitled to vote for the election of two additional Trustees of the Trust at a special meeting called by the holders of record of at least ten percent (10%) of any series of Preferred Shares so in

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arrears (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the shareholders) or at the next annual meeting of shareholders, and at each subsequent annual meeting until all distributions accumulated on such Series M-1 Preferred Shares for the past distribution periods and the then current distribution period shall have been fully paid or declared and a sum sufficient for the payment thereof set aside for payment.

(c)So long as any Series M-1 Preferred Shares remain outstanding, the Trust will not, without the affirmative vote or consent of the holders of at least two-thirds of the Series M-1 Preferred Shares outstanding at the time, given in person or by proxy, either in writing or at a meeting (such series voting separately as a class), (i) authorize or create, or increase the authorized or issued amount of, any class or series of shares of beneficial interest ranking senior to the Series M-1 Preferred Shares with respect to the payment of distributions or the distribution of assets upon liquidation, dissolution or winding up or reclassify any authorized shares of beneficial interest of the Trust into such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or (ii) amend, alter or repeal the provisions of the Trust’s Declaration of Trust or the terms of the Series M-1 Preferred Shares whether by merger, consolidation or otherwise (an “Event”), so as to materially and adversely affect any right, preference, privilege or voting power of the Series M-1 Preferred Shares or the holders thereof; provided, however, with respect to the occurrence of any Events set forth in (ii) above, so long as the Series M-1 Preferred Shares remain outstanding with the terms thereof materially unchanged, taking into account that upon the occurrence of an Event, the Trust may not be the surviving entity or the Series M-1 Preferred Shares that remain outstanding may bear a new title, designation and/or be issued by a different issuer, the occurrence of any such Event shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting power of holders of Series M-1 Preferred Shares and provided further that (x) any increase in the amount of the authorized Preferred Shares or the creation or issuance of any other Series M-1 Preferred Shares, or (y) any increase in the amount of authorized Series M-1 Preferred Shares or any other Preferred Shares, in each case ranking on a parity with or junior to the Series M-1 Preferred Shares with respect to payment of distributions or the distribution of assets upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting powers.

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The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding Series M-1 Preferred Shares shall have been redeemed or called for redemption and sufficient funds shall have been deposited in trust to effect such redemption.

(7)       Conversion.  The Series M-1 Preferred Shares are not convertible into or exchangeable for any other property or securities of the Trust, except into Excess Shares in connection with maintaining the ability of the Trust to qualify as a REIT.

C.            Restrictions on Transfer. The Series M-1 Preferred Shares shall be subject to the restrictions on transfer and ownership of Shares in Article VII of the Declaration of Trust, as supplemented below.

(1)           Certain Definitions.

For purposes of the Series M-1 Preferred Shares the following terms shall have the following meanings:

“Closing Date of the Series M-1 Preferred Shares Offering” shall mean the time and date of payment for and delivery of Series M-1 Preferred Shares issued pursuant to the exchange of Series B Preference Units of Lexford Properties, L.P.

“Special Triggering Event” shall mean either (i) the redemption or purchase by the Trust of all or a portion of the outstanding shares of beneficial interest in the Trust, or (ii) a change in the value of the Series M-1 Preferred Shares relative to any other class of beneficial interest in the Trust.

(2)           Special Triggering Event.   If during the period commencing on the Closing Date of the Series M-1 Preferred Shares Offering and prior to the Restriction Termination Date, a Special Triggering Event (if effective) or other event or occurrence (if effective) would result in any violation of section 7.2(a) of the Trust’s Declaration of Trust (or would result in the Trust being “closely held” within the meaning of Section 856(h) of the Code or would otherwise cause the Trust to fail to qualify as a REIT), then (i) the number of Series M-1 Preferred Shares (rounded up to the nearest whole share) that would (but for this section) cause any Person to Beneficially Own either Series M-1 Preferred Shares, or to Beneficially Own Series M-1 Preferred Shares and any other shares of beneficial interest in the Trust, in violation of section 7.2(a) (or would result in the Trust being “closely held” or otherwise fail to qualify as a REIT) shall constitute “Excess Shares” and shall be treated as provided in Article VII.  Such designation and treatment shall be effective as of the close of business on the Business Day prior to the date of the Special Triggering Event or other event or occurrence.

(3)           Ambiguity. In the case of an ambiguity in the application of any of the provisions of this section, including any definition contained in paragraph (1), the Board of Trustees shall have the power to determine the application of this section with respect to any situation based on the facts known to it (subject, however, to the provisions of Section 7.2(a)).

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(4)           Exclusion of Other Rights.

The Series M-1 Preferred Shares shall not have any voting powers, preferences and relative, participating, optional or other special rights, other than those specifically set forth in these terms of the Series M-1 Preferred Shares (as such terms may be amended from time to time) and in the Declaration of Trust.  The Series M-1 Preferred Shares shall have no preemptive or subscription rights.

(5)Headings of Subdivisions.

The headings of the various subdivisions hereof are for convenience of reference only and shall not affect the interpretation of any of the provisions hereof.

(6)           Severability of Provisions.

If any voting powers, preferences and relative, participating, optional and other special rights of the Series M-1 Preferred Shares and qualifications, limitations and restrictions thereof set forth in these terms of the Series M-1 Preferred Shares (as such terms may be amended from time to time) is invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, all other voting powers, preferences and relative, participating, optional and other special rights of Series M-1 Preferred Shares and qualifications, limitations and restrictions thereof set forth in these terms of the Series M-1 Preferred Shares (as so amended) which can be given effect without the invalid, unlawful or unenforceable voting powers, preferences, and relative, participating, optional or other special rights of Series M-1 Preferred Shares and qualifications, limitations and restrictions thereof herein set forth, shall nevertheless, remain in full force and effect and no preferences or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of the Series M-1 Preferred Shares herein set forth shall be deemed dependent upon any other such voting powers, preferences and relative, participating, optional or other special right of Series M-1 Preferred Shares and qualifications, limitations and restrictions thereof unless so expressed herein.

SECTION 13.11.                    Series M-2 Preferred Shares.

1.A.            Certain Definitions.

Unless the context otherwise requires, the terms defined in this subparagraph A of paragraph 1 shall have, for all purposes of these terms of the Series M-2 Preferred Shares, the meanings herein specified (with terms defined in the singular having comparable meanings when used in the plural).

“Business Day” shall mean any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in New York City are authorized or required by law, regulation or executive order to close.

“Common Shares” shall mean the common shares of beneficial interest, $.01 par value per share, of the Trust.

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“Distribution Period” shall have the meaning set forth in subparagraph (3) of paragraph B.

“Junior Shares” shall have the meaning set forth in subparagraph (2) of paragraph B.

“Person” shall mean an individual, corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code joint stock company or other entity, and also includes a group as that term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended; but does not include an underwriter which participates in a public offering of the Series M-2 Preferred Shares provided that the ownership of Series M-2 Preferred Shares by such Underwriter would not result in the Trust being “closely held” within the meaning of Section 856(h) of the Code, or would otherwise result in the Trust failing to qualify as a REIT.

“Preferred Shares” shall mean shares of beneficial interest of the Trust designated as or otherwise on a parity with the Series M-2 Preferred Shares as to distributions and rights upon voluntary or involuntary liquidation, winding up or dissolution of the Trust as may be issued and outstanding from time to time, including Series A Preferred Shares and Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares, Series E Preferred Shares, Series F Preferred Shares, Series G Preferred Shares, Series H Preferred Shares, Series J Preferred Shares, Series K Preferred Shares, Series L Preferred Shares, Series M Preferred Shares, Series M-1 Preferred Shares, and any other shares so designated.

“Quarterly Distribution Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“Record Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“REIT” shall mean a Real Estate Investment Trust under Section 856 of the Code.

“Series M-2 Redemption Date” shall have the meaning set forth in subparagraph (5) of paragraph B below.

“Series M-2 Redemption Price” shall have the meaning set forth in subparagraph (5) of paragraph B below.

All other capitalized terms used but not defined herein shall have the meanings ascribed to them in the Declaration of Trust.

B.            Series M-2 Preferred Shares

(1)           Number and Designation.  A series of Preferred Shares, consisting of 600,000 Preferred Shares designated as 8.375% Series M-2 Cumulative Redeemable Preferred

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Shares of Beneficial Interest, $.01 par value per share (liquidation preference $50.00 per share) (the “Series M-2 Preferred Shares”), is hereby established.

(2)           Ranking.  In respect of rights to receive distributions and to participate in distributions or payments in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Trust, the Series M-2 Preferred Shares shall rank pari passu with any other Preferred Shares of the Trust, and will rank senior to the Common Shares and any other class or series of shares of beneficial interest of the Trust ranking, as to distributions and upon liquidation, junior (collectively, the “Junior Shares”) to the Preferred Shares.

(3)           Distributions.  The holders of the then outstanding Series M-2 Preferred Shares shall be entitled to receive, when and as authorized by the Board of Trustees and declared by the Trust out of any funds legally available therefor, cumulative distributions at the rate of $4.185 per share per year, payable in equal amounts of $1.046875 per share quarterly in arrears in cash on the fifteenth day, or if not a Business Day, the next succeeding Business Day, of January, April, July and October in each year (each such day being hereinafter called a “Quarterly Distribution Date” and each period ending on a Quarterly Distribution Date being hereinafter called a “Distribution Period”), beginning on the first Quarterly Distribution Date following the issuance of the Series M-2 Preferred Shares, to shareholders of record at the close of business on such date as shall be fixed by the Board of Trustees at the time of declaration of the distribution (the “Record Date”), which shall not be less than 10 nor more than 30 days preceding the Quarterly Distribution Date.  The amount of any distribution payable for the initial Distribution Period and for any other Distribution Period shorter than a full Distribution Period shall be prorated and computed on the basis of a 360-day year of twelve 30-day months.  Distributions on each Series M-2 Preferred Share shall accrue and be cumulative from and including the date of original issue thereof, whether or not (i) distributions on such shares are earned or declared or (ii) on any Quarterly Distribution Date there shall be funds legally available for the payment of distributions.  Distributions paid on the Series M-2 Preferred Shares in an amount less than the total amount of such distributions at the time accrued and payable on such shares shall be allocated pro rata on a per share basis among all such shares at the time outstanding.

The amount of any distributions accrued on any Series M-2 Preferred Shares at any Quarterly Distribution Date shall be the amount of any unpaid distributions accumulated thereon, to and including such Quarterly Distribution Date, whether or not earned or declared, and the amount of distributions accrued on any Series M-2 Preferred Shares at any date other than a Quarterly Distribution Date shall be equal to the sum of the amount of any unpaid distributions accumulated thereon, to and including the last preceding Quarterly Distribution Date, whether or not earned or declared, plus an amount calculated on the basis of the annual distribution rate of $4.185 for the period after such last preceding Quarterly Distribution Date to and including the date as of which the calculation is made based on a 360-day year of twelve 30-day months.

In determining whether a distribution (other than upon voluntary or involuntary liquidation), by dividend, redemption or other acquisition of shares of beneficial interest of the Trust or otherwise, is permitted under Maryland law, amounts that would be needed, if the Trust were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of holders of Series M-2 Preferred Shares will not be added to the Trust’s total liabilities.

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Except as provided in these terms of the Series M-2 Preferred Shares, the Series M-2 Preferred Shares shall not be entitled to participate in the earnings or assets of the Trust.

(4)Liquidation Rights.

(a)Upon the voluntary or involuntary dissolution, liquidation or winding up of the Trust, the holders of the Series M-2 Preferred Shares then outstanding shall be entitled to receive and to be paid out of the assets of the Trust available for distribution to its shareholders, before any payment or distribution shall be made on any Junior Shares, the amount of $50.00 per Series M-2 Preferred Share, plus accrued and unpaid distributions thereon.

(b)After the payment to the holders of the Series M-2 Preferred Shares of the full preferential amounts provided for in this paragraph B, the holders of the Series M-2 Preferred Shares as such shall have no right or claim to any of the remaining assets of the Trust.

(c)If, upon any voluntary or involuntary dissolution, liquidation, or winding up of the Trust, the amounts payable with respect to the preference value of the Series M-2 Preferred Shares and any other shares of beneficial interest of the Trust ranking as to any such distribution on parity with the Series M-2 Preferred Shares are not paid in full, the holders of the Series M-2 Preferred Shares and of such other shares will share ratably in any such distribution of assets of the Trust in proportion to the full respective preference amounts to which they are entitled.

(d)Neither the sale of all or substantially all the property or business of the Trust, nor the merger or consolidation of the Trust into or with any other entity or the merger or consolidation of any other entity into or with the Trust, shall be deemed to be a dissolution, liquidation or winding up, voluntary or involuntary, for the purposes of this paragraph B.

(5)Redemption.

(a)   Optional Redemption.  On and after May 1, 2005, the Trust may, at its option, redeem at any time all or, from time to time, part of the Series M-2 Preferred Shares at a price per share (the “Series M-2 Redemption Price”), payable in cash, of $50.00 per Series M-2 Preferred Share, together with all accrued and unpaid distributions to and including the date fixed for redemption (the “Series M-2 Redemption Date”).

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(b)   Procedures for Redemption.

(i)         Notice of any redemption will be mailed by the Trust, postage prepaid, not less than 30 days nor more than 60 days prior to the Series M-2 Redemption Date, addressed to the holders of record of the Series M-2 Preferred Shares to be redeemed at their addresses as they appear on the share transfer records of the Trust.  No failure to give such notice or any defect therein or in the mailing thereof shall affect the validity of the proceedings for the redemption of any Series M-2 Preferred Shares except as to the holder to whom the Trust has failed to give notice or except as to the holder to whom notice was defective.  In addition to any information required by law or by the applicable rules of any exchange upon which Series M-2 Preferred Shares may be listed or admitted to trading, such notice shall state: (a) the Series M-2 Redemption Date; (b) the Series M-2 Redemption Price; (c) the number of Series M-2 Preferred Shares to be redeemed; (d) the place or places where certificates for such shares are to be surrendered for payment of the Series M-2 Redemption Price; and (e) that distributions on the shares to be redeemed will cease to accumulate on the Series M-2 Redemption Date.

(ii)        If notice has been mailed in accordance with subparagraph (5)(b)(i) above and provided that on or before the Series M-2 Redemption Date specified in such notice all funds necessary for such redemption shall have been irrevocably set aside by the Trust, separate and apart from its other funds in trust for the pro rata benefit of the holders of the Series M-2 Preferred Shares so called for redemption, so as to be, and to continue to be available therefor, then, from and after the Series M-2 Redemption Date (unless the Trust defaults in the payment of the Series M-2 Redemption Price), distributions on the Series M-2 Preferred Shares so called for redemption shall cease to accumulate, and said shares shall no longer be deemed to be outstanding and shall not have the status of Series M-2 Preferred Shares and all rights of the holders thereof as shareholders of the Trust (except the right to receive the Series M-2 Redemption Price) shall cease.  Upon surrender, in accordance with said notice, of the certificates for any Series M-2 Preferred Shares so redeemed (properly endorsed or assigned for transfer, if the Trust shall so require and the notice shall so state), such Series M-2 Preferred Shares shall be redeemed by the Trust at the Series M-2 Redemption Price.  In case fewer than all the Series M-2 Preferred Shares evidenced by any such certificate are redeemed, a new certificate or certificates shall be issued evidencing the unredeemed Series M-2 Preferred Shares without cost to the holder thereof.

(iii)    Any funds deposited with a bank or trust company for the purpose of redeeming Series M-2 Preferred Shares shall be irrevocable except that:

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(A)the Trust shall be entitled to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and the holders of any shares redeemed shall have no claim to such interest or other earnings; and

(B)any balance of monies so deposited by the Trust and unclaimed by the holders of the Series M-2 Preferred Shares entitled thereto at the expiration of two years from the applicable Series M-2 Redemption Date shall be repaid, together with any interest or other earnings earned thereon, to the Trust, and after any such repayment, the holders of the shares entitled to the funds so repaid to the Trust shall look only to the Trust for payment without interest or other earnings.

(iv)    No Series M-2 Preferred Shares may be redeemed except with funds legally available for the payment of the Series M-2 Redemption Price.

(v)     Unless full accumulated distributions on all Series M-2 Preferred Shares shall have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past Distribution Periods and the then current Distribution Period, no Series M-2 Preferred Shares shall be redeemed (unless all outstanding Series M-2 Preferred Shares are simultaneously redeemed) or purchased or otherwise acquired directly or indirectly (except by conversion into or exchange for shares of beneficial interest of the Trust ranking junior to the Series M-2 Preferred Shares as to distributions and upon liquidation); provided, however, that the foregoing shall not prevent the redemption of Series M-2 Preferred Shares pursuant to Article VII of the Declaration of Trust or the purchase or acquisition of Series M-2 Preferred Shares pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding Series M-2 Preferred Shares.

(vi)    If the Series M-2 Redemption Date is after a Record Date and before the related Quarterly Distribution Date, the distribution payable on such Quarterly Distribution Date shall be paid to the holder in whose name the Series M-2 Preferred Shares to be redeemed are registered at the close of business on such Record Date notwithstanding the redemption thereof between such Record Date and the related Quarterly Distribution Date or the Trust’s default in the payment of the distribution due.

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(vii)   In case of redemption of less than all Series M-2 Preferred Shares at the time outstanding, the Series M-2 Preferred Shares to be redeemed shall be selected pro rata from the holders of record of such shares in proportion to the number of Series M-2 Preferred Shares held by such holders (with adjustments to avoid redemption of fractional shares) or by any other equitable method determined by the Trust.

(6)               Voting Rights.  Except as provided in these terms of the Series M-2 Preferred Shares, the holders of the Series M-2 Preferred Shares shall not be entitled to vote at any meeting of the shareholders for election of trustees or for any other purposes or otherwise to participate in any action taken by the Trust or the shareholders thereof, or to receive notice (except for such notice as required by law) of any meeting of shareholders.

(a)In any matter in which the Series M-2 Preferred Shares are entitled to vote (as expressly provided herein), including any action by written consent, each Series M-2 Preferred Share shall be entitled to 10 votes, each of which 10 votes may be directed separately by the holder thereof (or by any proxy or proxies of such holder).  With respect to each Series M-2 Preferred Share, the holder thereof may designate up to 10 proxies, with each such proxy having the right to vote a whole number of votes (totaling 10 votes per Series M-2 Preferred Share).

(b)Whenever distributions on any Series M-2 Preferred Shares shall be in arrears for six or more quarterly periods, the holders of such Series M-2 Preferred Shares, voting separately as a class with all other series of Preferred Shares upon which like voting rights have been conferred and are exercisable, will be entitled to vote for the election of two additional Trustees of the Trust at a special meeting called by the holders of record of at least ten percent (10%) of any series of Preferred Shares so in arrears (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the shareholders) or at the next annual meeting of shareholders, and at each subsequent annual meeting until all distributions accumulated on such Series M-2 Preferred Shares for the past distribution periods and the then current distribution period shall have been fully paid or declared and a sum sufficient for the payment thereof set aside for payment.  In such case, the entire Board of Trustees of the Trust will be increased by two Trustees.

(c)So long as any Series M-2 Preferred Shares remain outstanding, the Trust will not, without the affirmative vote or consent of the holders of at least two-thirds of the Series M-2 Preferred Shares outstanding at the time, given in person or by proxy, either in writing or at a meeting (such series voting separately as a class), (i) authorize or create, or increase the authorized or issued

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amount of, any class or series of shares of beneficial interest ranking senior to the Series M-2 Preferred Shares with respect to the payment of distributions or the distribution of assets upon liquidation, dissolution or winding up or reclassify any authorized shares of beneficial interest of the Trust into such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or (ii) amend, alter or repeal the provisions of the Trust’s Declaration of Trust or the terms of the Series M-2 Preferred Shares whether by merger, consolidation or otherwise (an “Event”), so as to materially and adversely affect any right, preference, privilege or voting power of the Series M-2 Preferred Shares or the holders thereof; provided, however, with respect to the occurrence of any Events set forth in (ii) above, so long as the Series M-2 Preferred Shares remain outstanding with the terms thereof materially unchanged, taking into account that upon the occurrence of an Event, the Trust may not be the surviving entity or the Series M-2 Preferred Shares that remain outstanding may bear a new title, designation and/or be issued by a different issuer, the occurrence of any such Event shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting power of holders of Series M-2 Preferred Shares and provided further that (x) any increase in the amount of the authorized Preferred Shares or the creation or issuance of any other Series M-2 Preferred Shares, or (y) any increase in the amount of authorized Series M-2 Preferred Shares or any other Preferred Shares, in each case ranking on a parity with or junior to the Series M-2 Preferred Shares with respect to payment of distributions or the distribution of assets upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting powers.

The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding Series M-2 Preferred Shares shall have been redeemed or called for redemption and sufficient funds shall have been deposited in trust to effect such redemption.

(7)               Conversion. The Series M-2 Preferred Shares are not convertible into or exchangeable for any other property or securities of the Trust, except into Excess Shares in connection with maintaining the ability of the Trust to qualify as a REIT.

C.            Restrictions on Transfer. The Series M-2 Preferred Shares shall be subject to the restrictions on transfer and ownership of Shares in Article VII of the Declaration of Trust, as supplemented below.

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(1)           Certain Definitions.

For purposes of the Series M-2 Preferred Shares the following terms shall have the following meanings:

“Closing Date of the Series M-2 Preferred Shares Offering” shall mean the time and date of payment for and delivery of Series M-2 Preferred Shares issued pursuant to the exchange of Series B Preference Units of Lexford Properties, L.P.

“Special Triggering Event” shall mean either (i) the redemption or purchase by the Trust of all or a portion of the outstanding shares of beneficial interest in the Trust, or (ii) a change in the value of the Series M-2 Preferred Shares relative to any other class of beneficial interest in the Trust.

(2)           Special Triggering Event.   If during the period commencing on the Closing Date of the Series M-2 Preferred Shares Offering and prior to the Restriction Termination Date, a Special Triggering Event (if effective) or other event or occurrence (if effective) would result in any violation of section 7.2(a) of the Trust’s Declaration of Trust (or would result in the Trust being “closely held” within the meaning of Section 856(h) of the Code or would otherwise cause the Trust to fail to qualify as a REIT), then (i) the number of Series M-2 Preferred Shares (rounded up to the nearest whole share) that would (but for this section) cause any Person to Beneficially Own either Series M-2 Preferred Shares, or to Beneficially Own Series M-2 Preferred Shares and any other shares of beneficial interest in the Trust, in violation of section 7.2(a) (or would result in the Trust being “closely held” or otherwise fail to qualify as a REIT) shall constitute “Excess Shares” and shall be treated as provided in Article VII.  Such designation and treatment shall be effective as of the close of business on the Business Day prior to the date of the Special Triggering Event or other event or occurrence.

(3)           Ambiguity. In the case of an ambiguity in the application of any of the provisions of this section, including any definition contained in paragraph (1), the Board of Trustees shall have the power to determine the application of this section with respect to any situation based on the facts known to it (subject, however, to the provisions of Section 7.2(a)).

(4)           Exclusion of Other Rights.

The Series M-2 Preferred Shares shall not have any voting powers, preferences and relative, participating, optional or other special rights, other than those specifically set forth in these terms of the Series M-2 Preferred Shares (as such terms may be amended from time to time) and in the Declaration of Trust.  The Series M-2 Preferred Shares shall have no preemptive or subscription rights.

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(5)           Headings of Subdivisions.

The headings of the various subdivisions hereof are for convenience of reference only and shall not affect the interpretation of any of the provisions hereof.

(6)           Severability of Provisions.

If any voting powers, preferences and relative, participating, optional and other special rights of the Series M-2 Preferred Shares and qualifications, limitations and restrictions thereof set forth in these terms of the Series M-2 Preferred Shares (as such terms may be amended from time to time) is invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, all other voting powers, preferences and relative, participating, optional and other special rights of Series M-2 Preferred Shares and qualifications, limitations and restrictions thereof set forth in these terms of the Series M-2 Preferred Shares (as so amended), which can be given effect without the invalid, unlawful or unenforceable voting powers, preferences, and relative, participating, optional or other special rights of Series M-2 Preferred Shares and qualifications, limitations and restrictions thereof herein set forth, shall nevertheless, remain in full force and effect and no preferences or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of the Series M-2 Preferred Shares herein set forth shall be deemed dependent upon any other such voting powers, preferences and relative, participating, optional or other special right of Series M-2 Preferred Shares and qualifications, limitations and restrictions thereof unless so expressed herein.

SECTION 13.12.Series M-3 Preferred Shares.

1.             A.Certain Definitions.

Unless the context otherwise requires, the terms defined in this subparagraph A of paragraph 1 shall have, for all purposes of these terms of the Series M-3 Preferred Shares, the meanings herein specified (with terms defined in the singular having comparable meanings when used in the plural).

“Business Day” shall mean any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in New York City are authorized or required by law, regulation or executive order to close.

“Common Shares” shall mean the common shares of beneficial interest, $.01 par value per share, of the Trust.

“Distribution Period” shall have the meaning set forth in subparagraph (3) of paragraph B.

“Junior Shares” shall have the meaning set forth in subparagraph (2) of paragraph B.

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“Person” shall mean an individual, corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code joint stock company or other entity, and also includes a group as that term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended; but does not include an underwriter which participates in a public offering of the Series M-3 Preferred Shares provided that the ownership of Series M-3 Preferred Shares by such Underwriter would not result in the Trust being “closely held” within the meaning of Section 856(h) of the Code, or would otherwise result in the Trust failing to qualify as a REIT.

“Preferred Shares” shall mean shares of beneficial interest of the Trust designated as or otherwise on a parity with the Series M-3 Preferred Shares as to distributions and rights upon voluntary or involuntary liquidation, winding up or dissolution of the Trust as may be issued and outstanding from time to time, including Series A Preferred Shares and Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares, Series E Preferred Shares, Series F Preferred Shares, Series G Preferred Shares, Series H Preferred Shares, Series K Preferred Shares, Series L Preferred Shares, Series M Preferred Shares, Series M-1 Preferred Shares, Series M-2 Preferred Shares, and any other shares so designated.

“Quarterly Distribution Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“Record Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“REIT” shall mean a Real Estate Investment Trust under Section 856 of the Code.

“Series M-3 Redemption Date” shall have the meaning set forth in subparagraph (5) of paragraph B below.

“Series M-3 Redemption Price” shall have the meaning set forth in subparagraph (5) of paragraph B below.

All other capitalized terms used but not defined herein shall have the meanings ascribed to them in the Declaration of Trust.

B.            Series M-3 Preferred Shares.

(1)     Number and Designation.  A series of Preferred Shares, consisting of 1,000,000 Preferred Shares designated as 8.50% Series M-3 Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $50.00 per share) (the “Series M-3 Preferred Shares”), is hereby established.

(2)     Ranking.  In respect of rights to receive distributions and to participate in distributions or payments in the event of any voluntary or involuntary liquidation, dissolution or

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winding up of the Trust, the Series M-3 Preferred Shares shall rank pari passu with any other Preferred Shares of the Trust, and will rank senior to the Common Shares and any other class or series of shares of beneficial interest of the Trust ranking, as to distributions and upon liquidation, junior (collectively, the “Junior Shares”) to the Preferred Shares.

(3)     Distributions.  The holders of the then outstanding Series M-3 Preferred Shares shall be entitled to receive, when and as authorized by the Board of Trustees and declared by the Trust out of any funds legally available therefor, cumulative distributions at the rate of $4.25 per share per year, payable in equal amounts of $1.0625 per share quarterly in arrears in cash on the fifteenth day, or if not a Business Day, the next succeeding Business Day, of January, April, July and October in each year (each such day being hereinafter called a “Quarterly Distribution Date” and each period ending on a Quarterly Distribution Date being hereinafter called a “Distribution Period”), beginning on the first Quarterly Distribution Date following the issuance of each of the Series M-3 Preferred Shares, to shareholders of record at the close of business on such date as shall be fixed by the Board of Trustees at the time of declaration of the distribution (the “Record Date”), which shall not be less than 10 nor more than 30 days preceding the Quarterly Distribution Date.  The amount of any distribution payable for the initial Distribution Period and for any other Distribution Period shorter than a full Distribution Period shall be prorated and computed on the basis of a 360-day year of twelve 30-day months.  Distributions on each Series M-3 Preferred Share shall accrue and be cumulative from and including the date of original issue thereof, whether or not (i) distributions on such shares are earned or declared or (ii) on any Quarterly Distribution Date there shall be funds legally available for the payment of distributions.  Distributions paid on the Series M-3 Preferred Shares in an amount less than the total amount of such distributions at the time accrued and payable on such shares shall be allocated pro rata on a per share basis among all such shares at the time outstanding.

The amount of any distributions accrued on any Series M-3 Preferred Shares at any Quarterly Distribution Date shall be the amount of any unpaid distributions accumulated thereon, to and including such Quarterly Distribution Date, whether or not earned or declared, and the amount of distributions accrued on any Series M-3 Preferred Shares at any date other than a Quarterly Distribution Date shall be equal to the sum of the amount of any unpaid distributions accumulated thereon, to and including the last preceding Quarterly Distribution Date, whether or not earned or declared, plus an amount calculated on the basis of the annual distribution rate of $4.25 for the period after such last preceding Quarterly Distribution Date to and including the date as of which the calculation is made based on a 360-day year of twelve 30-day months.

In determining whether a distribution (other than upon voluntary or involuntary liquidation), by dividend, redemption or other acquisition of shares of beneficial interest of the Trust or otherwise, is permitted under Maryland law, amounts that would be needed, if the Trust were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of holders of Series M-3 Preferred Shares will not be added to the Trust’s total liabilities.

Except as provided in these terms of the Series M-3 Preferred Shares, the Series M-3 Preferred Shares shall not be entitled to participate in the earnings or assets of the Trust.

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(4)           Liquidation Rights.

(a)Upon the voluntary or involuntary dissolution, liquidation or winding up of the Trust, the holders of the Series M-3 Preferred Shares then outstanding shall be entitled to receive and to be paid out of the assets of the Trust available for distribution to its shareholders, before any payment or distribution shall be made on any Junior Shares, the amount of $50.00 per Series M-3 Preferred Share, plus accrued and unpaid distributions thereon.

(b)After the payment to the holders of the Series M-3 Preferred Shares of the full preferential amounts provided for in this paragraph B, the holders of the Series M-3 Preferred Shares as such shall have no right or claim to any of the remaining assets of the Trust.

(c)If, upon any voluntary or involuntary dissolution, liquidation, or winding up of the Trust, the amounts payable with respect to the preference value of the Series M-3 Preferred Shares and any other shares of beneficial interest of the Trust ranking as to any such distribution on parity with the Series M-3 Preferred Shares are not paid in full, the holders of the Series M-3 Preferred Shares and of such other shares will share ratably in any such distribution of assets of the Trust in proportion to the full respective preference amounts to which they are entitled.

(d)Neither the sale of all or substantially all the property or business of the Trust, nor the merger or consolidation of the Trust into or with any other entity or the merger or consolidation of any other entity into or with the Trust, shall be deemed to be a dissolution, liquidation or winding up, voluntary or involuntary, for the purposes of this paragraph B.

(5)           Redemption.

(a)Optional Redemption.  On and after August 11, 2005, the Trust may, at its option, redeem at any time all or, from time to time, part of the issued and outstanding Series M-3 Preferred Shares at a price per share (the “Series M-3 Redemption Price”), payable in cash, of $50.00 per Series M-3 Preferred Share, together with all accrued and unpaid distributions to and including the date fixed for redemption (the “Series M-3 Redemption Date”).

(b)Procedures for Redemption.

(i)      Notice of any redemption will be mailed by the Trust, postage prepaid, not less than 30 days nor more than 60 days prior to the

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Series M-3 Redemption Date, addressed to the holders of record of the Series M-3 Preferred Shares to be redeemed at their addresses as they appear on the share transfer records of the Trust.  No failure to give such notice or any defect therein or in the mailing thereof shall affect the validity of the proceedings for the redemption of any Series M-3 Preferred Shares except as to the holder to whom the Trust has failed to give notice or except as to the holder to whom notice was defective.  In addition to any information required by law or by the applicable rules of any exchange upon which Series M-3 Preferred Shares may be listed or admitted to trading, such notice shall state: (a) the Series M-3 Redemption Date; (b) the Series M-3 Redemption Price; (c) the number of Series M-3 Preferred Shares to be redeemed; (d) the place or places where certificates for such shares are to be surrendered for payment of the Series M-3 Redemption Price; and (e) that distributions on the shares to be redeemed will cease to accumulate on the Series M-3 Redemption Date.

(ii)     If notice has been mailed in accordance with subparagraph (5)(b)(i) above and provided that on or before the Series M-3 Redemption Date specified in such notice all funds necessary for such redemption shall have been irrevocably set aside by the Trust, separate and apart from its other funds in trust for the pro rata benefit of the holders of the Series M-3 Preferred Shares so called for redemption, so as to be, and to continue to be available therefor, then, from and after the Series M-3 Redemption Date (unless the Trust defaults in the payment of the Series M-3 Redemption Price), distributions on the Series M-3 Preferred Shares so called for redemption shall cease to accumulate, and said shares shall no longer be deemed to be outstanding and shall not have the status of Series M-3 Preferred Shares and all rights of the holders thereof as shareholders of the Trust (except the right to receive the Series M-3 Redemption Price) shall cease.  Upon surrender, in accordance with said notice, of the certificates for any Series M-3 Preferred Shares so redeemed (properly endorsed or assigned for transfer, if the Trust shall so require and the notice shall so state), such Series M-3 Preferred Shares shall be redeemed by the Trust at the Series M-3 Redemption Price.  In case fewer than all the Series M-3 Preferred Shares evidenced by any such certificate are redeemed, a new certificate or certificates shall be issued evidencing the unredeemed Series M-3 Preferred Shares without cost to the holder thereof.

(iii)    Any funds deposited with a bank or trust company for the purpose of redeeming Series M-3 Preferred Shares shall be irrevocable except that:

(A)the Trust shall be entitled to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and the holders of any

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shares redeemed shall have no claim to such interest or other earnings; and

(B)any balance of monies so deposited by the Trust and unclaimed by the holders of the Series M-3 Preferred Shares entitled thereto at the expiration of two years from the applicable Series M-3 Redemption Date shall be repaid, together with any interest or other earnings earned thereon, to the Trust, and after any such repayment, the holders of the shares entitled to the funds so repaid to the Trust shall look only to the Trust for payment without interest or other earnings.

(iv)    No Series M-3 Preferred Shares may be redeemed except with funds legally available for the payment of the Series M-3 Redemption Price.

(v)     Unless full accumulated distributions on all Series M-3 Preferred Shares shall have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past Distribution Periods and the then current Distribution Period, no Series M-3 Preferred Shares shall be redeemed (unless all outstanding Series M-3 Preferred Shares are simultaneously redeemed) or purchased or otherwise acquired directly or indirectly (except by conversion into or exchange for shares of beneficial interest of the Trust ranking junior to the Series M-3 Preferred Shares as to distributions and upon liquidation); provided, however, that the foregoing shall not prevent the redemption of Series M-3 Preferred Shares pursuant to Article VII of the Declaration of Trust or the purchase or acquisition of Series M-3 Preferred Shares pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding Series M-3 Preferred Shares.

(vi)    If the Series M-3 Redemption Date is after a Record Date and before the related Quarterly Distribution Date, the distribution payable on such Quarterly Distribution Date shall be paid to the holder in whose name the Series M-3 Preferred Shares to be redeemed are registered at the close of business on such Record Date notwithstanding the redemption thereof between such Record Date and the related Quarterly Distribution Date or the Trust’s default in the payment of the distribution due.

(vii)   In case of redemption of less than all Series M-3 Preferred Shares at the time outstanding, the Series M-3 Preferred Shares to be redeemed shall be selected pro rata from the holders of record of such shares in proportion to the number of Series M-3 Preferred Shares held by

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such holders (with adjustments to avoid redemption of fractional shares) or by any other equitable method determined by the Trust.

(6)           Voting Rights.      Except as provided in these terms of the Series M-3 Preferred Shares, the holders of the Series M-3 Preferred Shares shall not be entitled to vote at any meeting of the shareholders for election of trustees or for any other purposes or otherwise to participate in any action taken by the Trust or the shareholders thereof, or to receive notice (except for such notice as required by law) of any meeting of shareholders.

(a)In any matter in which the Series M-3 Preferred Shares are entitled to vote (as expressly provided herein), including any action by written consent, each Series M-3 Preferred Share shall be entitled to 10 votes, each of which 10 votes may be directed separately by the holder thereof (or by any proxy or proxies of such holder).  With respect to each Series M-3 Preferred Share, the holder thereof may designate up to 10 proxies, with each such proxy having the right to vote a whole number of votes (totaling 10 votes per Series M-3 Preferred Share).

(b)Whenever distributions on any Series M-3 Preferred Shares shall be in arrears for six or more quarterly periods, the holders of such Series M-3 Preferred Shares, voting separately as a class with all other series of Preferred Shares upon which like voting rights have been conferred and are exercisable, will be entitled to vote for the election of two additional Trustees of the Trust at a special meeting called by the holders of record of at least ten percent (10%) of any series of Preferred Shares so in arrears (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the shareholders) or at the next annual meeting of shareholders, and at each subsequent annual meeting until all distributions accumulated on such Series M-3 Preferred Shares for the past distribution periods and the then current distribution period shall have been fully paid or declared and a sum sufficient for the payment thereof set aside for payment.  In such case, the entire Board of Trustees of the Trust will be increased by two Trustees.

(c)So long as any Series M-3 Preferred Shares remain outstanding, the Trust will not, without the affirmative vote or consent of the holders of at least two-thirds of the Series M-3 Preferred Shares outstanding at the time, given in person or by proxy, either in writing or at a meeting (such series voting separately as a class), (i) authorize or create, or increase the authorized or issued amount of, any class or series of shares of beneficial interest ranking senior to the Series M-3 Preferred Shares with respect to the payment of distributions or the distribution of assets upon liquidation, dissolution or winding up or reclassify any authorized

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shares of beneficial interest of the Trust into such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or (ii) amend, alter or repeal the provisions of the Trust’s Declaration of Trust or the terms of the Series M-3 Preferred Shares whether by merger, consolidation or otherwise (an “Event”), so as to materially and adversely affect any right, preference, privilege or voting power of the Series M-3 Preferred Shares or the holders thereof; provided, however, with respect to the occurrence of any Events set forth in (ii) above, so long as the Series M-3 Preferred Shares remain outstanding with the terms thereof materially unchanged, taking into account that upon the occurrence of an Event, the Trust may not be the surviving entity or the Series M-3 Preferred Shares that remain outstanding may bear a new title, designation and/or be issued by a different issuer, the occurrence of any such Event shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting power of holders of Series M-3 Preferred Shares and provided further that (x) any increase in the amount of the authorized Preferred Shares or the creation or issuance of any other Series M-3 Preferred Shares, or (y) any increase in the amount of authorized Series M-3 Preferred Shares or any other Preferred Shares, in each case ranking on a parity with or junior to the Series M-3 Preferred Shares with respect to payment of distributions or the distribution of assets upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting powers.

The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding Series M-3 Preferred Shares shall have been redeemed or called for redemption and sufficient funds shall have been deposited in trust to effect such redemption.

(7)           Conversion. The Series M-3 Preferred Shares are not convertible into or exchangeable for any other property or securities of the Trust, except into Excess Shares in connection with maintaining the ability of the Trust to qualify as a REIT.

C.      Restrictions on Transfer.    The Series M-3 Preferred Shares shall be subject to the restrictions on transfer and ownership of Shares in Article VII of the Declaration of Trust, as supplemented below.

(1)           Certain Definitions.

For purposes of the Series M-3 Preferred Shares the following terms shall have the following meanings:

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“Closing Date of the Series M-3 Preferred Shares Offering” shall mean the time and date of payment for and delivery of Series M-3 Preferred Shares issued pursuant to the exchange of Series E Preference Units of Lexford Properties, L.P.

“Special Triggering Event” shall mean either (i) the redemption or purchase by the Trust of all or a portion of the outstanding shares of beneficial interest in the Trust, or (ii) a change in the value of the Series M-3 Preferred Shares relative to any other class of beneficial interest in the Trust.

(2)Special Triggering Event.If during the period commencing on the Closing Date of the Series M-3 Preferred Shares Offering and prior to the Restriction Termination Date, a Special Triggering Event (if effective) or other event or occurrence (if effective) would result in any violation of section 7.2(a) of the Trust’s Declaration of Trust (or would result in the Trust being “closely held” within the meaning of Section 856(h) of the Code or would otherwise cause the Trust to fail to qualify as a REIT), then (i) the number of Series M-3 Preferred Shares (rounded up to the nearest whole share) that would (but for this section) cause any Person to Beneficially Own either Series M-3 Preferred Shares, or to Beneficially Own Series M-3 Preferred Shares and any other shares of beneficial interest in the Trust, in violation of section 7.2(a) (or would result in the Trust being “closely held” or otherwise fail to qualify as a REIT) shall constitute “Excess Shares” and shall be treated as provided in Article VII.  Such designation and treatment shall be effective as of the close of business on the Business Day prior to the date of the Special Triggering Event or other event or occurrence.

(3)Ambiguity.In the case of an ambiguity in the application of any of the provisions of this section, including any definition contained in paragraph (1), the Board of Trustees shall have the power to determine the application of this section with respect to any situation based on the facts known to it (subject, however, to the provisions of Section 7.2(a)).

(4)Exclusion of Other Rights.

The Series M-3 Preferred Shares shall not have any voting powers, preferences and relative, participating, optional or other special rights, other than those specifically set forth in these terms of the Series M-3 Preferred Shares (as such terms may be amended from time to time) and in the Declaration of Trust.  The Series M-3 Preferred Shares shall have no preemptive or subscription rights.

(5)Headings of Subdivisions.

The headings of the various subdivisions hereof are for convenience of reference only and shall not affect the interpretation of any of the provisions hereof.

(6)Severability of Provisions.

If any voting powers, preferences and relative, participating, optional and other special rights of the Series M-3 Preferred Shares and qualifications, limitations and

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restrictions thereof set forth in these terms of the Series M-3 Preferred Shares (as such terms may be amended from time to time) is invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, all other voting powers, preferences and relative, participating, optional and other special rights of Series M-3 Preferred Shares and qualifications, limitations and restrictions thereof set forth in these terms of the Series M-3 Preferred Shares (as so amended), which can be given effect without the invalid, unlawful or unenforceable voting powers, preferences, and relative, participating, optional or other special rights of Series M-3 Preferred Shares and qualifications, limitations and restrictions thereof herein set forth, shall nevertheless, remain in full force and effect and no preferences or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of the Series M-3 Preferred Shares herein set forth shall be deemed dependent upon any other such voting powers, preferences and relative, participating, optional or other special right of Series M-3 Preferred Shares and qualifications, limitations and restrictions thereof unless so expressed herein.

SECTION 13.13.Series M-4 Preferred Shares.

1.  A.  Certain Definitions.

Unless the context otherwise requires, the terms defined in this subparagraph A of paragraph 1 shall have, for all purposes of these terms of the Series M-4 Preferred Shares, the meanings herein specified (with terms defined in the singular having comparable meanings when used in the plural).

“Business Day” shall mean any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in New York City are authorized or required by law, regulation or executive order to close.

“Common Shares” shall mean the common shares of beneficial interest, $.01 par  value per share, of the Trust.

“Distribution Period” shall have the meaning set forth in subparagraph (3) of paragraph B.

“Junior Shares” shall have the meaning set forth in subparagraph (2) of paragraph B.

“Person” shall mean an individual, corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code joint stock company or other entity, and also includes a group as that term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended; but does not include an underwriter which participates in a public offering of the Series M-4 Preferred Shares provided that the ownership of Series M-4 Preferred Shares by such Underwriter would not result in the Trust being “closely held” within the meaning of Section 856(h) of the Code, or would otherwise result in the Trust failing to qualify as a REIT.

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“Preferred Shares” shall mean shares of beneficial interest of the Trust designated as or otherwise on a parity with the Series M-4 Preferred Shares as to distributions and rights upon voluntary or involuntary liquidation, winding up or dissolution of the Trust as may be issued and outstanding from time to time, including Series A Preferred Shares and Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares, Series E Preferred Shares, Series F Preferred Shares, Series G Preferred Shares, Series H Preferred Shares, Series K Preferred Shares, Series L Preferred Shares, Series M Preferred Shares, Series M-1 Preferred Shares, Series M-2 Preferred Shares, Series M-3 Preferred Shares, Series M-4 Preferred Shares and any other shares so designated.

“Quarterly Distribution Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“Record Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“REIT” shall mean a Real Estate Investment Trust under Section 856 of the Code.

“Series M-4 Redemption Date” shall have the meaning set forth in subparagraph (5) of paragraph B below.

“Series M-4 Redemption Price” shall have the meaning set forth in subparagraph (5) of paragraph B below.

All other capitalized terms used but not defined herein shall have the meanings ascribed to them in the Declaration of Trust.

B.Series M-4 Preferred Shares.

(1)Number and Designation.  A series of Preferred Shares, consisting of 510,000 Preferred Shares designated as 7.875% Series M-4 Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $50.00 per share) (the “Series M-4 Preferred Shares”), is hereby established.

(2)Preferred Shares Issued Without Certificate.  Some or all of the Series M-4 Preferred Shares may be issued without certificates at the discretion of the officers of the Trust which may act through the transfer agent with respect to the Series M-4 Preferred Shares.

(3)Ranking.  In respect of rights to receive distributions and to participate in distributions or payments in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Trust, the Series M-4 Preferred Shares shall rank pari passu with any other Preferred Shares of the Trust, and will rank senior to the Common Shares and any other class or series of shares of beneficial interest of the Trust ranking, as to distributions and upon liquidation, junior (collectively, the “Junior Shares”) to the Preferred Shares.

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(4)Distributions.  The holders of the then outstanding Series M-4 Preferred Shares shall be entitled to receive, when and as authorized by the Board of Trustees and declared by the Trust out of any funds legally available therefor, cumulative distributions at the rate of $3.9375 per share per year, payable in equal amounts of $.984375 per share quarterly in arrears in cash on the fifteenth day, or if not a Business Day, the next succeeding Business Day, of January, April, July and October in each year (each such day being hereinafter called a “Quarterly Distribution Date” and each period ending on a Quarterly Distribution Date being hereinafter called a “Distribution Period”), beginning on the first Quarterly Distribution Date following the issuance of the Series M-4 Preferred Shares, to shareholders of record at the close of business on such date as shall be fixed by the Board of Trustees at the time of declaration of the distribution (the “Record Date”), which shall not be less than 10 nor more than 30 days preceding the Quarterly Distribution Date.  The amount of any distribution payable for the initial Distribution Period and for any other Distribution Period shorter than a full Distribution Period shall be prorated and computed on the basis of a 360-day year of twelve 30-day months.  Distributions on each Series M-4 Preferred Share shall accrue and be cumulative from and including the date of original issue thereof, whether or not (i) distributions on such shares are earned or declared or (ii) on any Quarterly Distribution Date there shall be funds legally available for the payment of distributions.  Distributions paid on the Series M-4 Preferred Shares in an amount less than the total amount of such distributions at the time accrued and payable on such shares shall be allocated pro rata on a per share basis among all such shares at the time outstanding.

The amount of any distributions accrued on any Series M-4 Preferred Shares at any Quarterly Distribution Date shall be the amount of any unpaid distributions accumulated thereon, to and including such Quarterly Distribution Date, whether or not earned or declared, and the amount of distributions accrued on any Series M-4 Preferred Shares at any date other than a Quarterly Distribution Date shall be equal to the sum of the amount of any unpaid distributions accumulated thereon, to and including the last preceding Quarterly Distribution Date, whether or not earned or declared, plus an amount calculated on the basis of the annual distribution rate of $3.9375 for the period after such last preceding Quarterly Distribution Date to and including the date as of which the calculation is made based on a 360-day year of twelve 30-day months.

In determining whether a distribution (other than upon voluntary or involuntary liquidation), by dividend, redemption or other acquisition of shares of beneficial interest of the Trust or otherwise, is permitted under Maryland law, amounts that would be needed, if the Trust were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of holders of Series M-4 Preferred Shares will not be added to the Trust’s total liabilities.

Except as provided in these terms of the Series M-4 Preferred Shares, the Series M-4 Preferred Shares shall not be entitled to participate in the earnings or assets of the Trust.

(5)  Liquidation Rights.

(a)Upon the voluntary or involuntary dissolution, liquidation or winding up of the Trust, the holders of the Series M-4 Preferred Shares then outstanding shall be entitled to receive and to be paid out of the assets of the Trust available for distribution to its shareholders, before any payment or distribution shall be made on

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any Junior Shares, the amount of $50.00 per Series M-4 Preferred Share, plus accrued and unpaid distributions thereon.

(b)After the payment to the holders of the Series M-4 Preferred Shares of the full preferential amounts provided for in this paragraph B, the holders of the Series M-4 Preferred Shares as such shall have no right or claim to any of the remaining assets of the Trust.

(c)If, upon any voluntary or involuntary dissolution, liquidation, or winding up of the Trust, the amounts payable with respect to the preference value of the Series M-4 Preferred Shares and any other shares of beneficial interest of the Trust ranking as to any such distribution on parity with the Series M-4 Preferred Shares are not paid in full, the holders of the Series M-4 Preferred Shares and of such other shares will share ratably in any such distribution of assets of the Trust in proportion to the full respective preference amounts to which they are entitled.

(d)Neither the sale of all or substantially all the property or business of the Trust, nor the merger or consolidation of the Trust into or with any other entity or the merger or consolidation of any other entity into or with the Trust, shall be deemed to be a dissolution, liquidation or winding up, voluntary or involuntary, for the purposes of this paragraph B.

(6)Redemption.

(a)Optional Redemption.  On and after March 21, 2006, the Trust may, at its option, redeem at any time all or, from time to time, part of the Series M-4 Preferred Shares at a price per share (the “Series M-4 Redemption Price”), payable in cash, of $50.00 per Series M-4 Preferred Share, together with all accrued and unpaid distributions to and including the date fixed for redemption (the “Series M-4 Redemption Date”).

(b)Procedures for Redemption.

(i)Notice of any redemption will be mailed by the Trust, postage prepaid, not less than 30 days nor more than 60 days prior to the Series M-4 Redemption Date, addressed to the holders of record of the Series M-4 Preferred Shares to be redeemed at their addresses as they appear on the share transfer records of the Trust.  No failure to give such notice or any defect therein or in the mailing thereof shall affect the validity of the proceedings for the redemption of any Series M-4 Preferred Shares except as to the holder to whom the Trust has failed to give notice or except as to the holder to whom notice was defective.  In addition to any

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information required by law or by the applicable rules of any exchange upon which Series M-4 Preferred Shares may be listed or admitted to trading, such notice shall state: (a) the Series M-4 Redemption Date; (b) the Series M-4 Redemption Price; (c) the number of Series M-4 Preferred Shares to be redeemed; (d) the place or places where certificates for such shares are to be surrendered for payment of the Series M-4 Redemption Price; and (e) that distributions on the shares to be redeemed will cease to accumulate on the Series M-4 Redemption Date.

(ii)If notice has been mailed in accordance with subparagraph (5)(b)(i) above and provided that on or before the Series M-4 Redemption Date specified in such notice all funds necessary for such redemption shall have been irrevocably set aside by the Trust, separate and apart from its other funds in trust for the pro rata benefit of the holders of the Series M-4 Preferred Shares so called for redemption, so as to be, and to continue to be available therefor, then, from and after the Series M-4 Redemption Date (unless the Trust defaults in the payment of the Series M-4 Redemption Price), distributions on the Series M-4 Preferred Shares so called for redemption shall cease to accumulate, and said shares shall no longer be deemed to be outstanding and shall not have the status of Series M-4 Preferred Shares and all rights of the holders thereof as shareholders of the Trust (except the right to receive the Series M-4 Redemption Price) shall cease.  Upon surrender, in accordance with said notice, of the certificates for any Series M-4 Preferred Shares so redeemed (properly endorsed or assigned for transfer, if the Trust shall so require and the notice shall so state), such Series M-4 Preferred Shares shall be redeemed by the Trust at the Series M-4 Redemption Price.  In case fewer than all the Series M-4 Preferred Shares evidenced by any such certificate are redeemed, a new certificate or certificates shall be issued evidencing the unredeemed Series M-4 Preferred Shares without cost to the holder thereof.

(iii)Any funds deposited with a bank or trust company for the purpose of redeeming Series M-4 Preferred Shares shall be irrevocable except that:

(A)the Trust shall be entitled to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and the holders of any shares redeemed shall have no claim to such interest or other earnings; and

(B)any balance of monies so deposited by the Trust and unclaimed by the holders of the Series M-4 Preferred Shares entitled thereto at the expiration of two years from the applicable Series M-4 Redemption Date shall be repaid,

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together with any interest or other earnings earned thereon, to the Trust, and, subject to escheat laws, after any such repayment, the holders of the shares entitled to the funds so repaid to the Trust shall look only to the Trust for payment without interest or other earnings.

(iv)No Series M-4 Preferred Shares may be redeemed except with funds legally available for the payment of the Series M-4 Redemption Price.

(v)Unless full accumulated distributions on all Series M-4 Preferred Shares shall have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past Distribution Periods and the then current Distribution Period, no Series M-4 Preferred Shares shall be redeemed (unless all outstanding Series M-4 Preferred Shares are simultaneously redeemed) or purchased or otherwise acquired directly or indirectly (except by conversion into or exchange for shares of beneficial interest of the Trust ranking junior to the Series M-4 Preferred Shares as to distributions and upon liquidation); provided, however, that the foregoing shall not prevent the redemption of Series M-4 Preferred Shares pursuant to Article VII of the Declaration of Trust or the purchase or acquisition of Series M-4 Preferred Shares pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding Series M-4 Preferred Shares.

(vi)If the Series M-4 Redemption Date is after a Record Date and before the related Quarterly Distribution Date, the distribution payable on such Quarterly Distribution Date shall be paid to the holder in whose name the Series M-4 Preferred Shares to be redeemed are registered at the close of business on such Record Date notwithstanding the redemption thereof between such Record Date and the related Quarterly Distribution Date or the Trust’s default in the payment of the distribution due.

(vii)In case of redemption of less than all Series M-4 Preferred Shares at the time outstanding, the Series M-4 Preferred Shares to be redeemed shall be selected pro rata from the holders of record of such shares in proportion to the number of Series M-4 Preferred Shares held by such holders (with adjustments to avoid redemption of fractional shares) or by any other equitable method determined by the Trust.

(7)Voting Rights. Except as provided in these terms of the Series M-4 Preferred Shares, the holders of the Series M-4 Preferred Shares shall not be entitled to vote at any meeting of the shareholders for election of trustees or for any other purposes or otherwise to participate in any action taken by the Trust or the shareholders thereof, or to receive notice (except for such notice as required by law) of any meeting of shareholders.

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(a)In any matter in which the Series M-4 Preferred Shares are entitled to vote (as expressly provided herein), including any action by written consent, each Series M-4 Preferred Share shall be entitled to 10 votes, each of which 10 votes may be directed separately by the holder thereof (or by any proxy or proxies of such holder).  With respect to each Series M-4 Preferred Share, the holder thereof may designate up to 10 proxies, with each such proxy having the right to vote a whole number of votes (totaling 10 votes per Series M-4 Preferred Share).

(b)Whenever distributions on any Series M-4 Preferred Shares shall be in arrears for six or more quarterly periods, the holders of such Series M-4 Preferred Shares, voting separately as a class with all other series of Preferred Shares upon which like voting rights have been conferred and are exercisable, will be entitled to vote for the election of two additional Trustees of the Trust at a special meeting called by the holders of record of at least ten percent (10%) of any series of Preferred Shares so in arrears (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the shareholders) or at the next annual meeting of shareholders, and at each subsequent annual meeting until all distributions accumulated on such Series M-4 Preferred Shares for the past distribution periods and the then current distribution period shall have been fully paid or declared and a sum sufficient for the payment thereof set aside for payment. In such case, the entire Board of Trustees of the Trust will be increased by two trustees.

(c)So long as any Series M-4 Preferred Shares remain outstanding, the Trust will not, without the affirmative vote or consent of the holders of at least two-thirds of the Series M-4 Preferred Shares outstanding at the time, given in person or by proxy, either in writing or at a meeting (such series voting separately as a class), (i) authorize or create, or increase the authorized or issued amount of, any class or series of shares of beneficial interest ranking senior to the Series M-4 Preferred Shares with respect to the payment of distributions or the distribution of assets upon liquidation, dissolution or winding up or reclassify any authorized shares of beneficial interest of the Trust into such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or (ii) amend, alter or repeal the provisions of the Trust’s Declaration of Trust or the terms of the Series M-4 Preferred Shares whether by merger, consolidation or otherwise (an “Event”), so as to materially and adversely affect any right, preference, privilege or voting power of the Series M-4 Preferred Shares or the holders thereof; provided, however, with respect to the occurrence of any

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Events set forth in (ii) above, so long as the Series M-4 Preferred Shares remain outstanding with the terms thereof materially unchanged, taking into account that upon the occurrence of an Event, the Trust may not be the surviving entity or the Series M-4 Preferred Shares that remain outstanding may bear a new title, designation and/or be issued by a different issuer, the occurrence of any such Event shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting power of holders of Series M-4 Preferred Shares and provided further that (x) any increase in the amount of the authorized Preferred Shares or the creation or issuance of any other Series M-4 Preferred Shares, or (y) any increase in the amount of authorized Series M-4 Preferred Shares or any other Preferred Shares, in each case ranking on a parity with or junior to the Series M-4 Preferred Shares with respect to payment of distributions or the distribution of assets upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting powers.

The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding Series M-4 Preferred Shares shall have been redeemed or called for redemption and sufficient funds shall have been deposited in trust to effect such redemption.

(8)Conversion. The Series M-4 Preferred Shares are not convertible into or exchangeable for any other property or securities of the Trust, except into Excess Shares in connection with maintaining the ability of the Trust to qualify as a REIT.

(9)Status of Redeemed or Reacquired Shares. All Series M-4 Preferred Shares that have been issued and redeemed or reacquired in any manner by the Trust shall become unclassified Preferred Shares available for subsequent reclassification and issuance.

C.Restrictions on Transfer.The Series M-4 Preferred Shares shall be subject to the restrictions on transfer and ownership of Shares in Article VII of the Declaration of Trust, as supplemented below.

(1)Certain Definitions.

For purposes of the Series M-4 Preferred Shares the following terms shall have the following meanings:

“Closing Date of the Series M-4 Preferred Shares Offering” shall mean the time and date of payment for and delivery of Series M-4 Preferred Shares issued pursuant to the exchange of Series G Cumulative Redeemable Preference Units of Lexford Properties, L.P.

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“Special Triggering Event” shall mean either (i) the redemption or purchase by the Trust of all or a portion of the outstanding shares of beneficial interest in the Trust, or (ii) a change in the value of the Series M-4 Preferred Shares relative to any other class of beneficial interest in the Trust.

(2)Special Triggering Event.If during the period commencing on the Closing Date of the Series M-4 Preferred Shares Offering and prior to the Restriction Termination Date, a Special Triggering Event (if effective) or other event or occurrence (if effective) would result in any violation of section 7.2(a) of the Trust’s Declaration of Trust (or would result in the Trust being “closely held” within the meaning of Section 856(h) of the Code or would otherwise cause the Trust to fail to qualify as a REIT), then (i) the number of Series M-4 Preferred Shares (rounded up to the nearest whole share) that would (but for this section) cause any Person to Beneficially Own either Series M-4 Preferred Shares, or to Beneficially Own Series M-4 Preferred Shares and any other shares of beneficial interest in the Trust, in violation of section 7.2(a) (or would result in the Trust being “closely held” or otherwise fail to qualify as a REIT) shall constitute “Excess Shares” and shall be treated as provided in Article VII.  Such designation and treatment shall be effective as of the close of business on the Business Day prior to the date of the Special Triggering Event or other event or occurrence.

(3)Ambiguity.    In the case of an ambiguity in the application of any of the provisions of this section, including any definition contained in paragraph (1), the Board of Trustees shall have the power to determine the application of this section with respect to any situation based on the facts known to it (subject, however, to the provisions of Section 7.2(a)).

(4)Exclusion of Other Rights.

The Series M-4 Preferred Shares shall not have any voting powers, preferences and relative, participating, optional or other special rights, other than those specifically set forth in these terms of the Series M-4 Preferred Shares (as such terms may be amended from time to time) and in the Declaration of Trust.  The Series M-4 Preferred Shares shall have no preemptive or subscription rights.

(5)Headings of Subdivisions.

The headings of the various subdivisions hereof are for convenience of reference only and shall not affect the interpretation of any of the provisions hereof.

(6)Severability of Provisions.

If any voting powers, preferences and relative, participating, optional and other special rights of the Series M-4 Preferred Shares and qualifications, limitations and restrictions thereof set forth in these terms of the Series M-4 Preferred Shares (as such terms may be amended from time to time) is invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, all other voting powers, preferences and relative, participating, optional and other special rights of Series M-4 Preferred Shares and

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qualifications, limitations and restrictions thereof set forth in these terms of the Series M-4 Preferred Shares (as so amended), which can be given effect without the invalid, unlawful or unenforceable voting powers, preferences, and relative, participating, optional or other special rights of Series M-4 Preferred Shares and qualifications, limitations and restrictions thereof herein set forth, shall nevertheless remain in full force and effect and no preferences or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of the Series M-4 Preferred Shares herein set forth shall be deemed dependent upon any other such voting powers, preferences and relative, participating, optional or other special right of Series M-4 Preferred Shares and qualifications, limitations and restrictions thereof unless so expressed herein.

SECTION 13.14.Series M-5 Preferred Shares.

1.A.Certain Definitions.

Unless the context otherwise requires, the terms defined in this subparagraph A of paragraph 1 shall have, for all purposes of these terms of the Series M-5 Preferred Shares, the meanings herein specified (with terms defined in the singular having comparable meanings when used in the plural).

“Business Day” shall mean any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in New York City are authorized or required by law, regulation or executive order to close.

“Closing Date of the Series M-5 Preferred Shares Offering” shall have the meaning set forth in subparagraph (1) of paragraph C below.

“Code” shall mean the Internal Revenue Code of 1986, as amended.

“Common Shares” shall mean the common shares of beneficial interest, $.01 par value per share, of the Trust.

“Constituent Person” shall have the meaning set forth in subparagraph (7)(e) of paragraph B below.

“Conversion Price” shall mean the conversion price per Common Share for which the Series M-5 Preferred Shares are convertible, as such Conversion Price may be adjusted pursuant to subparagraph (7)(d) of paragraph (B) below. The initial conversion price shall be $66.19 per Common Share (equivalent to a conversion rate of 0.7554 Common Shares for each Series M-5 Preferred Share, with such Series M-5 Preferred Shares being ascribed their $50.00 liquidation value).

“Current Market Price” shall mean the current market price of publicly traded common shares or any other class of shares of beneficial interest or other security of the Trust or any other issuer for any day shall mean the last reported sales-price, regular way on such day or, if no sale takes place on such day, the average of the reported closing bid and asked prices on such day, regular way, in either case as reported on the New York Stock Exchange (“NYSE”) or, if such

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security is not listed or admitted for trading on the NYSE, on the principal national securities exchange on which such security is listed or admitted for trading or, if not listed or admitted for trading on any national securities exchange, on the NASDAQ National Market, or, if such security is not quoted on such NASDAQ National Market, the average of the closing bid and asked prices on such day in the over-the-counter-market as reported by NASDAQ or, if bid and asked prices for such security on such day shall not have been reported through NASDAQ, the average of the bid and asked prices on such day as furnished by any NYSE member firm regularly making a market in such security selected for such purpose by the Chief Executive Officer or the Board of Trustees, or, if such security is not then currently traded on any established market and no bid and asked prices for such security on such day shall be available, the Current Market Price shall be as determined in good faith by the Chief Executive Officer or the Board of Trustees.

“Declaration of Trust” shall have the meaning set forth in Article First of these Articles Supplementary.

“Distribution Period” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“Event” shall have the meaning set forth in subparagraph (6)(c) of paragraph B below.

“Fair Market Value” shall mean the average of the daily Current Market Prices for a Common Share during the five (5) consecutive Trading Days selected by the Trust commencing not more than twenty (20) Trading Days before, and ending not later than, the earlier of the day in question and the day before the “ex date” with respect to the issuance or distribution requiring such computation.  The term “ex date” when used with respect to any issuance or distribution means the first day on which the Common Shares trade regular way, without the right to receive such issuance or distribution, on the exchange or in the market, as the case may be, used to determine that day’s Current Market Price.

“Issue Date” shall mean the first date on which the Series H Preference Units are issued.

“Junior Shares” shall have the meaning set forth in subparagraph (2) of paragraph B.

“Non-Electing Share” shall have the meaning set forth in subparagraph (7)(e) of paragraph B below.

“Person” shall mean an individual, corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code, joint stock company or other entity, and also includes a group as that term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended, but does not include an underwriter which participates in a public offering of the Series M-5 Preferred Shares; provided, that the ownership of Series M-5 Preferred Shares by such Underwriter would not result in the

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Trust being “closely held” within the meaning of Section 856(h) of the Code, or would otherwise result in the Trust failing to qualify as a REIT.

“Preferred Shares” shall mean shares of beneficial interest of the Trust designated as or otherwise on a parity with the Series M-5 Preferred Shares as to distributions and rights upon voluntary or involuntary liquidation, winding up or dissolution of the Trust as may be issued and outstanding from time to time, including Series A Preferred Shares, Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares, Series E Preferred Shares, Series F Preferred Shares, Series G Preferred Shares, Series H Preferred Shares, Series K Preferred Shares, Series L Preferred Shares, Series M Preferred Shares, Series M-1 Preferred Shares, Series M-2 Preferred Shares, Series M-3 Preferred Shares and Series M-4 Preferred Shares and any other shares so designated.

“Quarterly Distribution Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“Record Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“REIT” shall mean a Real Estate Investment Trust under Section 856 of the Code.

“Securities” shall have the meaning set forth in subparagraph (7)(d)(iii) of paragraph B below.

“Series H Preference Units” shall mean the 7.625% Series H Cumulative Convertible Redeemable Preference Units of Lexford Properties, L.P.

“Series M-5 Preferred Shares” shall have the meaning set forth in Article First of these Articles Supplementary.

“Series M-5 Redemption Date” shall have the meaning set forth in subparagraph (5) of paragraph B below.

“Series M-5 Redemption Price” shall have the meaning set forth in subparagraph (5) of paragraph B below.

“Special Triggering Event” shall have the meaning set forth in subparagraph (1) of paragraph C below.

“Trading Day” shall mean any day on which the securities in question are traded on the NYSE, or if such securities are not listed or admitted for trading on the NYSE, on the principal national securities exchange on which such securities are listed or admitted, or if not listed or admitted for trading on any national securities exchange, on the NASDAQ National Market, or if such securities are not quoted on such NASDAQ National Market, in the applicable securities market in which the securities are traded.

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“Transaction” shall have the meaning set forth in subparagraph (7)(e) of paragraph B below.

“Transfer Agent” shall mean Fleet National Bank, which may act through its affiliate, EquiServe Limited Partnership, or such other agent or agents of the Trust as may be designated by the Board of Trustees or their designee as the transfer agent for the Series M-5 Preferred Shares.

“Trust” shall have the meaning set forth in Article First of these Articles Supplementary.

All other capitalized terms used but not defined herein shall have the meanings ascribed to them in the Declaration of Trust.

B.Series M-5 Preferred Shares

(1)Number and Designation.  A series of Preferred Shares, consisting of 190,000 Preferred Shares designated as 7.625% Series M-5 Convertible Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $50.00 per share) (the “Series M-5 Preferred Shares”), is hereby established.

(2)Ranking.  In respect of rights to receive distributions and to participate in distributions or payments in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Trust, the Series M-5 Preferred Shares shall rank pari passu with any other Preferred Shares of the Trust, and will rank senior to the Common Shares and any other class or series of shares of beneficial interest of the Trust ranking, as to distributions and upon liquidation, junior (collectively, the “Junior Shares”) to the Preferred Shares.

(3)Distributions.  The holders of the then outstanding Series M-5 Preferred Shares shall be entitled to receive, when and as authorized by the Board of Trustees and declared by the Trust out of any funds legally available therefor, cumulative distributions at the rate of $3.8125 per share per year, payable in equal amounts of $.953125 per share quarterly in arrears in cash on the fifteenth day, or if not a Business Day, the next succeeding Business Day, of January, April, July and October in each year (each such day being hereinafter called a “Quarterly Distribution Date” and each period ending on a Quarterly Distribution Date being hereinafter called a “Distribution Period”), beginning on the first Quarterly Distribution Date following the issuance of the Series M-5 Preferred Shares, to shareholders of record at the close of business on such date as shall be fixed by the Board of Trustees at the time of declaration of the distribution (the “Record Date”), which shall not be less than 10 nor more than 30 days preceding the Quarterly Distribution Date.  The amount of any distribution payable for the initial Distribution Period and for any other Distribution Period shorter than a full Distribution Period shall be pro-rated and computed on the basis of a 360-day year of twelve 30-day months.  Distributions on each Series M-5 Preferred Share shall accrue and be cumulative from and including the date of original issue thereof, whether or not (i) distributions on such shares are earned or declared or (ii) on any Quarterly Distribution Date there shall be funds legally available for the payment of distributions.  Distributions paid on the Series M-5 Preferred Shares in an amount less than the total amount of such distributions at the

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time accrued and payable on such shares shall be allocated pro rata on a per share basis among all such shares at the time outstanding.

The amount of any distributions accrued on any Series M-5 Preferred Shares at any Quarterly Distribution Date shall be the amount of any unpaid distributions accumulated thereon, to and including such Quarterly Distribution Date, whether or not earned or declared, and the amount of distributions accrued on any Series M-5 Preferred Shares at any date other than a Quarterly Distribution Date shall be equal to the sum of the amount of any unpaid distributions accumulated thereon, to and including the last preceding Quarterly Distribution Date, whether or not earned or declared, plus an amount calculated on the basis of the annual distribution rate of $3.8125 for the period after such last preceding Quarterly Distribution Date to and including the date as of which the calculation is made based on a 360-day year of twelve 30-day months.

In determining whether a distribution (other than upon voluntary or involuntary liquidation), by dividend, redemption or other acquisition of shares of beneficial interest of the Trust or otherwise, is permitted under Maryland law, amounts that would be needed, if the Trust were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of holders of Series M-5 Preferred Shares will not be added to the Trust’s total liabilities.

Except as provided in these terms of the Series M-5 Preferred Shares, the Series M-5 Preferred Shares shall not be entitled to participate in the earnings or assets of the Trust.

(4)Liquidation Rights.

(a)Upon the voluntary or involuntary dissolution, liquidation or winding up of the Trust, the holders of the Series M-5 Preferred Shares then outstanding shall be entitled to receive and to be paid out of the assets of the Trust available for distribution to its shareholders, before any payment or distribution shall be made on any Junior Shares, the amount of $50.00 per Series M-5 Preferred Share, plus accrued and unpaid distributions thereon.

(b)After the payment to the holders of the Series M-5 Preferred Shares of the full preferential amounts provided for in this paragraph B, the holders of the Series M-5 Preferred Shares as such shall have no right or claim to any of the remaining assets of the Trust.

(c)If, upon any voluntary or involuntary dissolution, liquidation or winding up of the Trust, the amounts payable with respect to the preference value of the Series M-5 Preferred Shares and any other shares of beneficial interest of the Trust ranking as to any such distribution on parity with the Series M-5 Preferred Shares are not paid in full, the holders of the Series M-5 Preferred Shares and of such other shares will share ratably in any such distribution of assets of the Trust in proportion to the full respective preference amounts to which they are entitled.

(d)Neither the sale of all or substantially all of the property or business of the Trust, nor the merger or consolidation of the Trust into or

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with any other entity or the merger or consolidation of any other entity into or with the Trust, shall be deemed to be a dissolution, liquidation or winding up, voluntary or involuntary, for purposes of this paragraph B.

(5)Redemption.

(a)Optional Redemption.  On and after March 23, 2006, the Trust may, at its option, redeem at any time all or, from time to time, part of the Series M-5 Preferred Shares at a price per share (the “Series M-5 Redemption Price”), payable in cash, of $50.00 per Series M-5 Preferred Share, together with all accrued and unpaid distributions to and including the date fixed for redemption (the “Series M-5 Redemption Date”), subject to the provisions of paragraph 7 herein.

(b)Procedures for Redemption.

(i)Notice of any redemption will be mailed by the Trust, postage prepaid, or sent via overnight delivery service, not less than 30 days nor more than 60 days prior to the Series M-5 Redemption Date, addressed to the holders of record of the Series M-5 Preferred Shares to be redeemed at their addresses as they appear on the share transfer records of the Trust.  No failure to give such notice or any defect therein or in the mailing thereof shall affect the validity of the proceedings for the redemption of any Series M-5 Preferred Shares except as to the holder to whom the Trust has failed to give notice or except as to the holder to whom notice was defective.  In addition to any information required by law or by the applicable rules of any exchange upon which Series M-5 Preferred Shares may be listed or admitted to trading, such notice shall state: (a) the Series M-5 Redemption Date; (b) the Series M-5 Redemption Price; (c) the number of Series M-5 Preferred Shares to be redeemed; (d) the place or places where certificates for such shares are to be surrendered for payment of the Series M-5 Redemption Price; and (e) that distributions on the shares to be redeemed will cease to accumulate on the Series M-5 Redemption Date.

(ii)If notice has been mailed in accordance with subparagraph (5)(b)(i) above and provided that on or before the Series M-5 Redemption Date specified in such notice all funds necessary for such redemption shall have been irrevocably set aside by the Trust, separate and apart from its other funds in trust for the pro rata benefit of the holders of the Series M-5 Preferred Shares so called for redemption, so as to be, and to continue to be available therefor, then, from and after the Series M-5 Redemption Date (unless the Trust defaults in the payment of the Series M-5 Redemption Price), distributions on the Series M-5 Preferred Shares so called for redemption shall cease to accumulate, and said shares shall no longer be deemed to be outstanding and shall not have the status of Series M-5 Preferred Shares and all rights of the holders thereof as shareholders of the Trust (except the right to receive the Series M-5 Redemption Price) shall

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cease. If payment of the Series M-5 Preferred Shares is improperly withheld or refused and not paid by the Trust, distributions on such Series M-5 Preferred Shares will continue to accumulate from the original redemption date to the date of payment, in which case the actual payment date will be considered the date fixed for redemption for purposes of calculating the applicable Series M-5 Redemption Price.  Upon surrender, in accordance with said notice, of the certificates for any Series M-5 Preferred Shares so redeemed (properly endorsed or assigned for transfer, if the Trust shall so require and the notice shall so state), such Series M-5 Preferred Shares shall be redeemed by the Trust at the Series M-5 Redemption Price.  In case fewer than all the Series M-5 Preferred Shares evidenced by any such certificate are redeemed, a new certificate or certificates shall be issued evidencing the unredeemed Series M-5 Preferred Shares without cost to the holder thereof.

(iii)Any funds deposited with a bank or trust company for the purpose of redeeming Series M-5 Preferred Shares shall be irrevocable except that:

(A)the Trust shall be entitled to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and the holders of any shares redeemed shall have no claim to such interest or other earnings; and

(B)any balance of monies so deposited by the Trust and unclaimed by the holders of the Series M-5 Preferred Shares entitled thereto at the expiration of two years from the applicable Series M-5 Redemption Date shall be repaid, together with any interest or other earnings earned thereon, to the Trust, and after any such repayment, the holders of the shares entitled to the funds so repaid to the Trust shall look only to the Trust for payment without interest or other earnings.

(iv)No Series M-5 Preferred Shares may be redeemed except with funds legally available for the payment of the Series M-5 Redemption Price.

(v)Unless full accumulated distributions on all Series M-5 Preferred Shares shall have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past Distribution Periods and the then current Distribution Period, no Series M-5 Preferred Shares shall be redeemed (unless all outstanding Series M-5 Preferred Shares are simultaneously redeemed) or purchased or otherwise acquired directly or indirectly (except by conversion into or exchange for shares of beneficial interest of the Trust ranking junior to the Series M-5 Preferred Shares as to distributions and upon liquidation);

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provided, however, that the foregoing shall not prevent the redemption of Series M-5 Preferred Shares pursuant to Article VII of the Declaration of Trust or the purchase or acquisition of Series M-5 Preferred Shares.

(vi)If the Series M-5 Redemption Date is after a Record Date and before the related Quarterly Distribution Date, the distribution payable on such Quarterly Distribution Date shall be paid to the holder in whose name the Series M-5 Preferred Shares to be redeemed are registered at the close of business on such Record Date notwithstanding the redemption thereof between such Record Date and the related Quarterly Distribution Date or the Trust’s default in the payment of the distribution due.

(vii)In case of redemption of less than all Series M-5 Preferred Shares at the time outstanding, the Series M-5 Preferred Shares to be redeemed shall be selected pro rata from the holders of record of such shares in proportion to the number of Series M-5 Preferred Shares held by such holders (with adjustments to avoid redemption of fractional shares) or by any other equitable method determined by the Trust.

(6)Voting Rights.  Except as provided in these terms of the Series M-5 Preferred Shares, the holders of the Series M-5 Preferred Shares shall not be entitled to vote at any meeting of the shareholders for election of trustees or for any other purposes or otherwise to participate in any action taken by the Trust or the shareholders thereof, or to receive notice (except for such notice as required by law) of any meeting of shareholders.

(a)In any matter in which the Series M-5 Preferred Shares are entitled to vote (as expressly provided herein), including any action by written consent, each Series M-5 Preferred Share shall be entitled to 10 votes, each of which 10 votes may be directed separately by the holder thereof (or by any proxy or proxies of such holder).  With respect to each Series M-5 Preferred Share, the holder thereof may designate up to 10 proxies, with each such proxy having the right to vote a whole number of votes (totaling 10 votes per Series M-5 Preferred Share).

(b)Whenever distributions on any Series M-5 Preferred Shares shall be in arrears for six or more quarterly periods, the holders of such Series M-5 Preferred Shares, voting separately as a class with all other series of Preferred Shares upon which like voting rights have been conferred and are exercisable, will be entitled to vote for the election of two additional Trustees of the Trust at a special meeting called by the holders of record of at least ten percent (10%) of any series of Preferred Shares so in arrears (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the shareholders) or at the next annual meeting of shareholders, and at each subsequent annual meeting until all distributions accumulated on such Series M-5 Preferred Shares for the past distribution periods and the then current distribution period shall have been fully paid or declared and a sum sufficient for the payment thereof set aside for payment.

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In such case, the entire Board of Trustees of the Trust will be increased by two Trustees.

(c)So long as any Series M-5 Preferred Shares remain outstanding, the Trust will not, without the affirmative vote or consent of the holders of at least two-thirds of the Series M-5 Preferred Shares outstanding at the time, given in person or by proxy, either in writing or at a meeting (such series voting separately as a class), (i) authorize or create, or increase the authorized or issued amount of, any class or series of shares of beneficial interest ranking senior to the Series M-5 Preferred Shares with respect to the payment of distributions or the distribution of assets upon liquidation, dissolution or winding up or reclassify any authorized shares of beneficial interest of the Trust into such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or (ii) amend, alter or repeal the provisions of the Trust’s Declaration of Trust or the terms of the Series M-5 Preferred Shares whether by merger, consolidation or otherwise (an “Event”), so as to materially and adversely affect any right, preference, privilege or voting power of the Series M-5 Preferred Shares or the holders thereof; provided, however, with respect to the occurrence of any Events set forth in (ii) above, so long as the Series M-5 Preferred Shares remain outstanding with the terms thereof materially unchanged, taking into account that upon the occurrence of an Event, the Trust may not be the surviving entity or the Series M-5 Preferred Shares that remain outstanding may bear a new title, designation and/or be issued by a different issuer, the occurrence of any such Event shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting power of holders of Series M-5 Preferred Shares and provided further that (x) any increase in the amount of the authorized Preferred Shares or the creation or issuance of any other Series M-5 Preferred Shares, or (y) any increase in the amount of authorized Series M-5 Preferred Shares or any other Preferred Shares, in each case ranking on a parity with or junior to the Series M-5 Preferred Shares with respect to payment of distributions or the distribution of assets upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting powers.

The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding Series M-5 Preferred Shares shall have been redeemed or called for redemption and sufficient funds shall have been deposited in trust to effect such redemption.

(7)Conversion.  Holders of Series M-5 Preferred Shares shall have the right to convert all or a portion of such shares into Common Shares, as follows:

(a)Subject to and upon compliance with the provisions of this subparagraph (7), a holder of Series M-5 Preferred Shares shall have the right, at his or her option, at any time after March 23, 2011 to convert such shares into the

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number of fully paid and non-assessable Common Shares obtained by dividing the aggregate liquidation preference of such shares by the Conversion Price (as in effect at the time and on the date provided for in the last paragraph of subsection (b) of this subparagraph (7)) by surrendering such shares to be converted, such surrender to be made in the manner provided in subsection (b) of this subparagraph (7); provided, however, that a holder of Series M-5 Preferred Shares shall have the right to convert such shares as provided above, at his or her option, at any time subsequent to such shares being called for redemption pursuant to subparagraph (5), which right to convert such shares upon a call for redemption shall terminate at the close of business on the fifth Business Day preceding the Series M-5 Redemption Date fixed for such redemption, unless the Trust shall default in making payment of the Common Shares and any cash payable upon such redemption under subparagraph (5) hereof, in which case the holders will retain the conversion rights provided herein, and provided further that, prior to such time as the Series M-5 Preferred Shares have been registered for resale with the United States Securities and Exchange Commission and listed for trading on the NYSE or the NASDAQ National Market, the Series M-5 Preferred Shares shall be convertible in whole, but not in part, with respect to all of the outstanding Series M-5 Preferred Shares.

(b)In order to exercise the conversion right, the holder of each Series M-5 Preferred Share to be converted shall surrender the certificate representing such share, duly endorsed or assigned to the Trust or in blank, at the office of the Transfer Agent, accompanied by written notice to the Trust that the holder thereof elects to convert such Series M-5 Preferred Share delivered to the Trust by (a) fax and (b) certified mail postage prepaid or overnight delivery to:  Equity Residential Properties Trust, Two North Riverside Plaza, Suite 400, Chicago, Illinois 60606, Attention: Bruce C. Strohm, facsimile number (312) 454-0039.  Unless the shares issuable on conversion are to be issued in the same name as the name in which such Series M-5 Preferred Share is registered, each share surrendered for conversion shall be accompanied by instruments of transfer, in form satisfactory to the Trust, duly executed by the holder or such holder’s duly authorized attorney and an amount sufficient to pay any transfer or similar tax (or evidence reasonably satisfactory to the Trust demonstrating that such taxes have been paid).

Holders of Series M-5 Preferred Shares at the close of business on a distribution payment record date shall be entitled to receive the distribution payable on such shares on the corresponding Quarterly Distribution Date notwithstanding the conversion thereof following such distribution payment record date and prior to such Quarterly Distribution Date.  However, Series M-5 Preferred Shares surrendered for conversion during the period between the close of business on any distribution payment record date and the opening of business on the corresponding Quarterly Distribution Date (except shares converted after the issuance of notice of redemption with respect to a Series M-5 Redemption Date during such period or coinciding with such Quarterly Distribution Date, such Series M-5 Preferred Shares being entitled to such distribution on the Quarterly Distribution Date) must be accompanied by payment of a pro rata portion of the distribution payable on such shares on such Quarterly Distribution Date equal to the product of (i) the amount of the quarterly

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distribution multiplied by (ii) a fraction, the numerator of which is the number of days beginning on the date of surrender of such Series M-5 Preferred Shares as provided in the preceding paragraph and ending on the Quarterly Distribution Date, and the denominator of which is 90.  A holder of Series M-5 Preferred Shares on a distribution payment record date who (or whose transferees) tenders any such shares for conversion into Common Shares on such Quarterly Distribution Date will receive the distribution payable by the Trust on such Series M-5 Preferred Shares on such date, and the converting holder need not include payment of the amount of such distribution upon surrender of Series M-5 Preferred Shares for conversion.  Except as provided above, the Trust shall make no payment or allowance for unpaid distributions, whether or not in arrears, on converted shares or for distributions on the Common Shares issued upon such conversion.

As promptly as practicable after the surrender of certificates representing Series M-5 Preferred Shares as aforesaid, the Trust shall issue and shall deliver at such office to such holder, or on his or her written order, a certificate or certificates for the number of full Common Shares issuable upon the conversion of such shares in accordance with the provisions of this subparagraph (7), and any fractional interest in respect of a Common Share arising upon such conversion shall be settled as provided in subsection (c) of this subparagraph (7).

Each conversion shall be deemed to have been effected immediately prior to the close of business on the date on which the certificates for Series M-5 Preferred Shares shall have been surrendered and such notice (and if applicable, payment of an amount equal to the distribution payable on such shares) received by the Trust as aforesaid, and the person or persons in whose name or names any certificate or certificates for Common Shares shall be issuable upon such conversion shall be deemed to have become the holder or holders of record of the shares represented thereby at such time on such date, and such conversion shall be at the Conversion Price in effect at such time and on such date unless the share transfer books of the Trust shall be closed on that date, in which event such person or persons shall be deemed to have become such holder or holders of record at the close of business on the next succeeding day on which such share transfer books are open, but such conversion shall be at the Conversion Price in effect on the date on which such shares have been surrendered and such notice received by the Trust.

(c)No fractional shares or scrip representing fractions of Common Shares shall be issued upon conversion of the Series M-5 Preferred Shares.  Instead of any fractional interest in a Common Share that would otherwise be deliverable upon the conversion of a share of Series M-5 Preferred Shares, the Trust shall pay to the holder of such share an amount in cash based upon the Current Market Price of the Common Shares on the Trading Day immediately preceding the date of conversion.  If more than one Series M-5 Preferred Share shall be surrendered for conversion at one time by the same holder, the number of full Common Shares issuable upon conversion thereof shall be computed on the basis of the aggregate number of Series M-5 Preferred Shares so surrendered.

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(d)The Conversion Price shall be adjusted from time to time as follows:

(i)If the Trust shall after the Issue Date (A) pay a distribution or make a distribution on its shares of beneficial interest in Common Shares, (B) subdivide its outstanding Common Shares into a greater number of shares, (C) combine its outstanding Common Shares into a smaller number of shares, or (D) issue any shares of beneficial interest by reclassification of its Common Shares, the Conversion Price in effect at the opening of business on the day following the date fixed for the determination of shareholders entitled to receive such distribution or at the opening of business on the day following the day on which such subdivision, combination or reclassification becomes effective, as the case may be, shall be adjusted so that the holder of any Series M-5 Preferred Shares thereafter surrendered for conversion shall be entitled to receive the number of Common Shares that such holder would have owned or have been entitled to receive after the happening of any of the events described above had such shares been converted immediately prior to the record date in the case of a distribution or the effective date in the case of a subdivision, combination or reclassification.  An adjustment made pursuant to this subsection (i) shall become effective immediately after the opening of business on the day next following the record date (except as provided in paragraph (h) below) in the case of a distribution and shall become effective immediately after the opening of business on the day next following the effective date in the case of a subdivision, combination or reclassification.

(ii)If the Trust shall issue after the Issue Date rights, options or warrants to all holders of Common Shares entitling them (for a period expiring within 45 days after the record date mentioned below) to subscribe for or purchase Common Shares at a price per share less than the Fair Market Value per Common Share on the record date for the determination of shareholders entitled to receive such rights, options or warrants, then the Conversion Price in effect at the opening of business on the day next following such record date shall be adjusted to equal the price determined by multiplying (I) the Conversion Price in effect immediately prior to the opening of business on the day following the date fixed for such determination by (II) a fraction, the numerator of which shall be the sum of (A) the number of Common Shares outstanding on the close of business on the date fixed for such determination and (B) the number of shares that the aggregate proceeds to the Trust from the exercise of such rights, options or warrants for Common Shares would purchase at such Fair Market Value, and the denominator of which shall be the sum of (A) the number of Common Shares outstanding on the close of business on the date fixed for such determination and (B) the number of additional Common Shares offered for subscription or purchase pursuant to such rights, options or warrants.  Such adjustment shall become effective immediately after the opening of business on the day next following such record date (except as provided in subsection (h) below).  In determining whether any rights, options or warrants entitle the holders of Common Shares to subscribe for or purchase Common Shares at less than the Fair Market Value, there shall be taken into account any consideration received by the Trust upon issuance and upon exercise of such

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rights, options or warrants, the value of such consideration, if other than cash, to be determined by the Chief Executive Officer or the Board of Trustees.

(iii)If the Trust shall distribute to all holders of its Common Shares any shares of beneficial interest of the Trust (other than Common Shares) or evidence of its indebtedness or assets (excluding cash distributions paid out of the total equity applicable to Common Shares, including revaluation equity, less the amount of stated capital attributable to Common Shares, determined on the basis of the most recent annual and quarterly consolidated cost basis balance sheets of the Trust and its consolidated subsidiaries available at the time of the declaration of the distribution) or rights or warrants to subscribe for or purchase any of its securities (excluding those rights and warrants issued to all holders of Common Shares entitling them for a period expiring within 45 days after the record date referred to in subsection (ii) above to subscribe for or purchase Common Shares, which rights and warrants are referred to in and treated under subsection (ii) above) (any of the foregoing being hereinafter in this subsection (iii) called the “Securities”), then in each case the Conversion Price shall be adjusted so that it shall equal the price determined by multiplying (I) the Conversion Price in effect immediately prior to the close of business on the date fixed for the determination of shareholders entitled to receive such distribution by (II) a fraction, the numerator of which shall be the Fair Market Value per Common Share on the record date mentioned below less the then fair market value (as determined by the Chief Executive Officer or the Board of Trustees, whose determination shall be conclusive) of the portion of the shares of beneficial interest or assets or evidences of indebtedness so distributed or of such rights or warrants applicable to one Common Share, and the denominator of which shall be the Fair Market Value per Common Share on the record date mentioned below.  Such adjustment shall become effective immediately at the opening of business on the Business Day next following (except as provided in subsection (h) below) the record date for the determination of shareholders entitled to receive such distribution.  For the purposes of this subsection (iii), the distribution of a Security, which is distributed not only to the holders of the Common Shares on the date fixed for the determination of shareholders entitled to such distribution of such Security, but also is distributed with each Common Share delivered to a Person converting a Series M-5 Preferred Share after such determination date, shall not require an adjustment of the Conversion Price pursuant to this subsection (iii); provided that on the date, if any, on which a person converting a Series M-5 Preferred Share would no longer be entitled to receive such Security with a Common Share (other than as a result of the termination of all such Securities), a distribution of such Securities shall be deemed to have occurred, and the Conversion Price shall be adjusted as provided in this subsection (iii) (and such day shall be deemed to be “the date fixed for the determination of the shareholders entitled to receive such distribution” and “the record date” within the meaning of the two preceding sentences).

(iv)No adjustment in the Conversion Price shall be required unless such adjustment would require a cumulative increase or decrease of at least 1% in such price; provided, however, that any adjustments that by reason of

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this subsection (iv) are not required to be made shall be carried forward and taken into account in any subsequent adjustment until made; and provided, further, that any adjustment shall be required and made in accordance with the provisions of this subparagraph (7) (other than this subsection (iv)) not later than such time as may be required in order to preserve the tax-free nature of a distribution to the holders of Common Shares.  Notwithstanding any other provisions of this subparagraph (7), the Trust shall not be required to make any adjustment of the Conversion Price for the issuance of any Common Shares pursuant to any plan providing for the reinvestment of distributions or interest payable on securities of the Trust and the investment of additional optional amounts in Common Shares under such plan.  All calculations under this subparagraph (7) shall be made to the nearest cent with ($.005 being rounded upward) or to the nearest one-tenth of a share (with .05 of a share being rounded upward), as the case may be.  Anything in this subsection (d) to the contrary notwithstanding, the Trust shall be entitled, to the extent permitted by law, to make such reductions in the Conversion Price, in addition to those required by this subsection (d), as it in its discretion shall determine to be advisable in order that any share distributions, subdivision of shares, reclassification or combination of shares, distribution of rights, options or warrants to purchase shares or securities, or a distribution of other assets (other than cash distributions) hereafter made by the Trust to its shareholders shall not be taxable.

(e)If the Trust shall be a party to any transaction (including, without limitation, a merger, consolidation, statutory share exchange, self tender offer for all or substantially all of the Common Shares, sale of all or substantially all of the Trust’s assets or recapitalization of the Common Shares and excluding any transaction as to which subsection (d)(i) of this subparagraph (7) applied) (each of the foregoing being referred to herein as a “Transaction”), in each case as a result of which Common Shares shall be converted into the right to receive shares, stock, securities or other property (including cash or any combination thereof), each Series M-5 Preferred Share which is not converted into the right to receive shares, stock, securities or other property in connection with such Transaction shall thereafter be convertible into the kind and amount of shares, stock, securities and other property (including cash or any combination thereof) receivable upon the consummation of such Transaction by a holder of that number of Common Shares into which one Series M-5 Preferred Share was convertible immediately prior to such Transaction, assuming such holder of Common Shares (i) is not a Person with which the Trust consolidated or into which the Trust merged or which merged into the Trust or to which such sale or transfer was made, as the case may be (a “Constituent Person”), or an affiliate of a Constituent Person and (ii) failed to exercise his or her rights of the election, if any, as to the kind or amount of shares, stock, securities and other property (including cash) receivable upon such Transaction (provided that if the kind or amount of shares, stock, securities and other property (including cash) receivable upon such Transaction is not the same for each Common Share of the Trust held immediately prior to such Transaction by other than a Constituent Person or an affiliate thereof and in respect of which such rights of election shall not have been exercised (the “Non-Electing Share”), then for purposes of this paragraph (e) the kind and amount of shares, securities and other property (including cash)

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receivable upon such Transaction by each Non-Electing Share shall be deemed to be the kind and amount so receivable per share by a plurality of the Non-Electing Shares). The Trust shall not be a party to any Transaction unless the terms of such Transaction are consistent with the provisions of this subsection (e), and it shall not consent or agree to the occurrence of any Transaction until the Trust has entered into an agreement with the successor or purchasing entity, as the case may be, for the benefit of the holders of the Series M-5 Preferred Shares that will contain provisions enabling the holders of the Series M-5 Preferred Shares that remain outstanding after such Transaction to convert into the consideration received by holders of Common Shares at the Conversion Price in effect immediately prior to such Transaction.  The provisions of this subsection (e) shall similarly apply to successive Transactions.

(f)If:

(i)the Trust shall declare a distribution on the Common Shares (other than in cash out of the total equity applicable to Common Shares, including revaluation equity, less the amount of stated capital attributable to Common Shares, determined on the basis of the most recent annual and quarterly consolidated cost basis balance sheets of the Trust and its consolidated subsidiaries available at the time of the declaration of the distribution); or

(ii)the Trust shall authorize the granting to the holders of the Common Shares of rights or warrants to subscribe for or purchase any shares of any class or any other rights or warrants; or

(iii)there shall be any reclassifications of the Common Shares (other than an event to which subsection (d)(i) of this subparagraph (7) applied) or any consolidation or merger to which the Trust is a party and for which approval of any shareholders of the Trust is required, or a statutory share exchange involving the conversion or exchange of Common Shares into securities or other property, or a self tender offer by the Trust for all or substantially all of its outstanding Common Shares, or the sale or transfer of all or substantially all of the assets of the Trust as an entity and for which approval of any stockholder of the Trust is required; or

(iv)there shall occur the voluntary or involuntary liquidation, dissolution or winding up of the Trust,

then the Trust shall cause to be filed with the Transfer Agent and shall cause to be mailed to the holders of the Series M-5 Preferred Shares at their addresses as shown on the share records of the Trust, as promptly as possible, but at least 15 days prior to the applicable date hereinafter specified, a notice stating (A) the date on which a record is to be taken for the purpose of such distribution or rights or warrants, or, if a record is not to be taken, the date as of which the holders of Common Shares of record to be entitled to such distribution or rights or warrants are to be determined or (B) the date on which such reclassification, consolidation, merger, statutory share exchange, sale, transfer, liquidation, dissolution or winding up is expected to

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become effective, and the date as of which it is expected that holders of Common Shares of record shall be entitled to exchange their Common Shares for securities or other property, if any, deliverable upon such reclassification, consolidation, merger, statutory share exchange, sale, transfer, liquidation, dissolution or winding up.  Failure to give or receive such notice or any defect therein shall not affect the legality or validity of the proceedings described in this subparagraph (7).

(g)Whenever the Conversion Price is adjusted as herein provided, the Trust shall promptly file with the Transfer Agent and the Depository an officer’s certificate setting forth the Conversion Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment, which certificate shall be conclusive evidence of the correctness of such adjustment absent manifest error.  Promptly after delivery of such certificate, the Trust shall prepare a notice of such adjustment of the Conversion Price setting forth the adjusted Conversion Price and the effective date such adjustment becomes effective and shall mail such notice of such adjustment of the Conversion Price to the holder of each Series M-5 Preferred Share at such holder’s last address as shown on the share records of the Trust.

(h)In any case in which subsection (d) of this subparagraph (7) provides that an adjustment shall become effective on the date next following the record date for an event, the Trust may defer until the occurrence of such event (A) issuing to the holder of any Series M-5 Preferred Shares converted after such record date and before the occurrence of such event the additional Common Shares issuable upon such conversion by reason of the adjustment required by such event over and above the Common Shares issuable upon such conversion before giving effect to such adjustment and (B) fractionalizing any Series M-5 Preferred Share and/or paying to such holder any amount of cash in lieu of any fraction pursuant to subsection (c) of this subparagraph (7).

(i)There shall be no adjustment of the Conversion Price in case of the issuance of any shares of beneficial interest of the Trust in a reorganization, acquisition or other similar transaction except as specifically set forth in this subparagraph (7).  If any action or Transaction would require adjustment of the Conversion Price pursuant to more than one subsection of this subparagraph (7), only one adjustment shall be made, and such adjustment shall be the amount of adjustment that has the highest absolute value.

(j)If the Trust shall take any action affecting the Common Shares, other than action described in this subparagraph (7), that in the opinion of the Board of Trustees would materially adversely affect the conversion rights of the holders of the Series M-5 Preferred Shares, the Conversion Price for the Series M-5 Preferred Shares may be adjusted, to the extent permitted by law, in such manner, if any, and at such time, as the Board of Trustees, in its sole discretion, may determine to be equitable in the circumstances.

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(k)The Trust covenants that it will at all times reserve and keep available, free from preemptive rights, out of the aggregate of its authorized but issued Common Shares, for the purpose of affecting conversion of the Series M-5 Preferred Shares, the full number of Common Shares deliverable upon the conversion of all outstanding Series M-5 Preferred Shares not theretofore converted.  For purposes of this subsection (k), the number of Common Shares that shall be deliverable upon the conversion of all outstanding Series M-5 Preferred Shares shall be computed as if at the time of computation all such outstanding shares were held by a single holder.

The Trust covenants that any Common Shares issued upon conversion of the Series M-5 Preferred Shares shall be validly issued, fully paid and non-assessable.  Before taking any action that would cause an adjustment reducing the Conversion Price below the then-par value of the Common Shares deliverable upon conversion of  the Series M-5 Preferred Shares, the Trust will take any action that, in the opinion of its counsel, may be necessary in order that the Trust may validly and legally issue fully paid and nonassessable Common Shares at such adjusted Conversion Price.

The Trust shall endeavor to list the Common Shares required to be delivered upon conversion of the Series M-5 Preferred Shares, prior to such delivery, upon each national securities exchange, if any, upon which the outstanding Common Shares are listed at the time of such delivery.

Prior to the delivery of any securities that the Trust shall be obligated to deliver upon conversion of the Series M-5 Preferred Shares, the Trust shall endeavor to comply with all federal and state laws and regulations thereunder requiring the registration of such securities with, or any approval of or consent to the delivery thereof by any governmental authority.

(l)The Trust will pay any and all documentary stamp or similar issue or transfer taxes payable in respect of the issue or delivery of Common Shares or other securities or property on conversion of the Series M-5 Preferred Shares pursuant hereto; provided, however, that the Trust shall not be required to pay any tax that may be payable in respect of any transfer involved in the issue or delivery of Common Shares or other securities or property in a name other than that of title holder of the Series M-5 Preferred Shares to be converted, and no such issue or delivery shall be made unless and until the person requesting such issue or delivery has paid to the Trust the amount of any such tax or established, to the reasonable satisfaction of the Trust, that such tax has been paid.

(m)In addition to the foregoing adjustments, the Company will be permitted to make such reductions in the Conversion Price as it considers to be advisable in order that any event treated for federal income tax purposes as a dividend of stock or stock rights will not be taxable to the holders of the Common Shares.

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C.Restrictions on Transfer.  The Series M-5 Preferred Shares shall be subject to the restrictions on transfer and ownership of Shares in Article VII of the Declaration of Trust, as supplemented below.

(1)Certain Definitions.

For purposes of the Series M-5 Preferred Shares the following terms shall have the following meanings:

“Closing Date of the Series M-5 Preferred Shares Offering” shall mean the time and date of payment for and delivery of Series M-5 Preferred Shares issued pursuant to the conversion of Series H Preference Units.

“Special Triggering Event” shall mean either (i) the redemption or purchase by the Trust of all or a portion of the outstanding shares of beneficial interest in the Trust, or (ii) a change in the value of the Series M-5 Preferred Shares relative to any other class of beneficial interest in the Trust.

(2)Special Triggering Event.  If during the period commencing on the Closing Date of the Series M-5 Preferred Shares Offering and prior to the Restriction Termination Date, a Special Triggering Event (if effective) or other event or occurrence (if effective) would result in any violation of section 7.2(a) of the Trust’s Declaration of Trust (or would result in the Trust being “closely held” within the meaning of Section 856(h) of the Code or would otherwise cause the Trust to fail to qualify as a REIT), then (i) the number of Series M-5 Preferred Shares (rounded up to the nearest whole share) that would (but for this section) cause any Person to Beneficially Own either Series M-5 Preferred Shares, or to Beneficially Own Series M-5 Preferred Shares and any other shares of beneficial interest in the Trust, in violation of section 7.2(a) (or would result in the Trust being “closely held” or otherwise fail to qualify as a REIT) shall constitute “Excess Shares” and shall be treated as provided in Article VII.  Such designation and treatment shall be effective as of the close of business on the Business Day prior to the date of the Special Triggering Event or other event or occurrence.

(3)Ambiguity.  In the case of an ambiguity in the application of any of the provisions of this section, including any definition contained in paragraph (1), the Board of Trustees shall have the power to determine the application of this section with respect to any situation based on the facts known to it (subject, however, to the provisions of Section 7.2(a)).

(4)Exclusion of Other Rights.

The Series M-5 Preferred Shares shall not have any voting powers, preferences and relative, participating, optional or other special rights, other than those specifically set forth in these terms of the Series M-5 Preferred Shares (as such terms may be amended from time to time) and in the Declaration of Trust.  The Series M-5 Preferred Shares shall have no preemptive or subscription rights.

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(5)Headings of Subdivisions.

The headings of the various subdivisions hereof are for convenience of reference only and shall not affect the interpretation of any of the provisions hereof.

(6)Severability of Provisions.

If any voting powers, preferences and relative, participating, optional and other special rights of the Series M-5 Preferred Shares and qualifications, limitations and restrictions thereof set forth in these terms of the Series M-5 Preferred Shares (as such terms may be amended from time to time) is invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, all other voting powers, preferences and relative, participating, optional and other special rights of Series M-5 Preferred Shares and qualifications, limitations and restrictions thereof set forth in these terms of the Series M-5 Preferred Shares (as so amended), which can be given effect without the invalid, unlawful or unenforceable voting powers, preferences, and relative, participating, optional or other special rights of Series M-5 Preferred Shares and qualifications, limitations and restrictions thereof herein set forth, shall nevertheless, remain in full force and effect and no preferences or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of the Series M-5 Preferred Shares herein set forth shall be deemed dependent upon any other such voting powers, preferences and relative, participating, optional or other special rights of Series M-5 Preferred Shares and qualifications, limitations and restrictions thereof unless so expressed herein.

SECTION 13.15.Series M-6 Preferred Shares.

1.A.Certain Definitions.

Unless the context otherwise requires, the terms defined in this subparagraph A of paragraph 1 shall have, for all purposes of these terms of the Series M-6 Preferred Shares, the meanings herein specified (with terms defined in the singular having comparable meanings when used in the plural).

“Business Day” shall mean any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in New York City are authorized or required by law, regulation or executive order to close.

“Closing Date of the Series M-6 Preferred Shares Offering” shall have the meaning set forth in subparagraph (1) of paragraph C below.

“Code” shall mean the Internal Revenue Code of 1986, as amended.

“Common Shares” shall mean the common shares of beneficial interest, $.01 par  value per share, of the Trust.

“Constituent Person” shall have the meaning set forth in subparagraph (7)(e) of paragraph B below.

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“Conversion Price” shall mean the conversion price per Common Share for which the Series M-6 Preferred Shares are convertible, as such Conversion Price may be adjusted pursuant to subparagraph (7)(d) of paragraph (B) below. The initial conversion price shall be $68.76 per Common Share (equivalent to a conversion rate of 0.7271 Common Shares for each Series M-6 Preferred Share, with such Series M-6 Preferred Shares being ascribed their $50.00 liquidation value).

“Current Market Price” shall mean the current market price of publicly traded common shares or any other class of shares of beneficial interest or other security of the Trust or any other issuer for any day shall mean the last reported sales-price, regular way on such day or, if no sale takes place on such day, the average of the reported closing bid and asked prices on such day, regular way, in either case as reported on the New York Stock Exchange (“NYSE”) or, if such security is not listed or admitted for trading on the NYSE, on the principal national securities exchange on which such security is listed or admitted for trading or, if not listed or admitted for trading on any national securities exchange, on the NASDAQ National Market, or, if such security is not quoted on such NASDAQ National Market, the average of the closing bid and asked prices on such day in the over-the-counter-market as reported by NASDAQ or, if bid and asked prices for such security on such day shall not have been reported through NASDAQ, the average of the bid and asked prices on such day as furnished by any NYSE member firm regularly making a market in such security selected for such purpose by the Chief Executive Officer or the Board of Trustees, or, if such security is not then currently traded on any established market and no bid and asked prices for such security on such day shall be available, the Current Market Price shall be as determined in good faith by the Chief Executive Officer or the Board of Trustees.

“Declaration of Trust” shall have the meaning set forth in Article First of these Articles Supplementary.

“Distribution Period” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“Event” shall have the meaning set forth in subparagraph (6)(c) of paragraph B below.

“Fair Market Value” shall mean the average of the daily Current Market Prices for a Common Share during the five (5) consecutive Trading Days selected by the Trust commencing not more than twenty (20) Trading Days before, and ending not later than, the earlier of the day in question and the day before the “ex date” with respect to the issuance or distribution requiring such computation.  The term “ex date” when used with respect to any issuance or distribution means the first day on which the Common Shares trade regular way, without the right to receive such issuance or distribution, on the exchange or in the market, as the case may be, used to determine that day’s Current Market Price.

“Issue Date” shall mean the first date on which the Series I Preference Units are issued.

“Junior Shares” shall have the meaning set forth in subparagraph (2) of paragraph B.

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“Non-Electing Share” shall have the meaning set forth in subparagraph (7)(e) of paragraph B below.

“Person” shall mean an individual, corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code, joint stock company or other entity, and also includes a group as that term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended, but does not include an underwriter which participates in a public offering of the Series M-6 Preferred Shares; provided, that the ownership of Series M-6 Preferred Shares by such Underwriter would not result in the Trust being “closely held” within the meaning of Section 856(h) of the Code, or would otherwise result in the Trust failing to qualify as a REIT.

“Preferred Shares” shall mean shares of beneficial interest of the Trust designated as or otherwise on a parity with the Series M-6 Preferred Shares as to distributions and rights upon voluntary or involuntary liquidation, winding up or dissolution of the Trust as may be issued and outstanding from time to time, including Series A Preferred Shares, Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares, Series E Preferred Shares, Series F Preferred Shares, Series G Preferred Shares, Series H Preferred Shares, Series K Preferred Shares, Series L Preferred Shares, Series M Preferred Shares, Series M-1 Preferred Shares, Series M-2 Preferred Shares, Series M-3 Preferred Shares, Series M-4 Preferred Shares and Series M-5 Preferred Shares and any other shares so designated.

“Quarterly Distribution Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“Record Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“REIT” shall mean a Real Estate Investment Trust under Section 856 of the Code.

“Securities” shall have the meaning set forth in subparagraph (7)(d)(iii) of paragraph B below.

“Series I Preference Units” shall mean the 7.625% Series I Cumulative Convertible Redeemable Preference Units of Lexford Properties, L.P.

“Series M-6 Preferred Shares” shall have the meaning set forth in Article First of these Articles Supplementary.

“Series M-6 Redemption Date” shall have the meaning set forth in subparagraph (5) of paragraph B below.

“Series M-6 Redemption Price” shall have the meaning set forth in subparagraph (5) of paragraph B below.

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“Special Triggering Event” shall have the meaning set forth in subparagraph (1) of paragraph C below.

“Trading Day” shall mean any day on which the securities in question are traded on the NYSE, or if such securities are not listed or admitted for trading on the NYSE, on the principal national securities exchange on which such securities are listed or admitted, or if not listed or admitted for trading on any national securities exchange, on the NASDAQ National Market, or if such securities are not quoted on such NASDAQ National Market, in the applicable securities market in which the securities are traded.

“Transaction” shall have the meaning set forth in subparagraph (7)(e) of paragraph B below.

“Transfer Agent” shall mean Fleet National Bank, which may act through its affiliate, EquiServe Trust Company, N.A., or such other agent or agents of the Trust as may be designated by the Board of Trustees or their designee as the transfer agent for the Series M-6 Preferred Shares.

“Trust” shall have the meaning set forth in Article First of these Articles Supplementary.

All other capitalized terms used but not defined herein shall have the meanings ascribed to them in the Declaration of Trust.

B.Series M-6 Preferred Shares.

(1)Number and Designation.  A series of Preferred Shares, consisting of 270,000 Preferred Shares designated as 7.625% Series M-6 Convertible Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $50.00 per share) (the “Series M-6 Preferred Shares”), is hereby established.

(2)Ranking.  In respect of rights to receive distributions and to participate in distributions or payments in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Trust, the Series M-6 Preferred Shares shall rank pari passu with any other Preferred Shares of the Trust, and will rank senior to the Common Shares and any other class or series of shares of beneficial interest of the Trust ranking, as to distributions and upon liquidation, junior (collectively, the “Junior Shares”) to the Preferred Shares.

(3)Distributions.  The holders of the then outstanding Series M-6 Preferred Shares shall be entitled to receive, when and as authorized by the Board of Trustees and declared by the Trust out of any funds legally available therefor, cumulative distributions at the rate of $3.8125 per share per year, payable in equal amounts of $.953125 per share quarterly in arrears in cash on the fifteenth day, or if not a Business Day, the next succeeding Business Day, of January, April, July and October in each year (each such day being hereinafter called a “Quarterly Distribution Date” and each period ending on a Quarterly Distribution Date being hereinafter called a “Distribution Period”), beginning on the first Quarterly Distribution Date following the issuance of the Series M-6 Preferred Shares, to shareholders of record at the close of business on such date

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as shall be fixed by the Board of Trustees at the time of declaration of the distribution (the “Record Date”), which shall not be less than 10 nor more than 30 days preceding the Quarterly Distribution Date.  The amount of any distribution payable for the initial Distribution Period and for any other Distribution Period shorter than a full Distribution Period shall be pro-rated and computed on the basis of a 360-day year of twelve 30-day months. Notwithstanding anything to the contrary set forth herein, if and when the holders of the Series I Lexford Preference Units exercise their right to convert the Series I Lexford Preference Units into Series M-6 Preferred Shares, the amount of any distribution payable for the initial Distribution Period shall include any and all amounts of distributions accrued but not yet paid on the Series I Lexford Preference Units in accordance with Section 9(B)(ii) of the Other Securities Term Sheet and Joinder to Amended and Restated Limited Partnership Agreement of Lexford Properties, L.P. Distributions on each Series M-6 Preferred Share shall accrue and be cumulative from and including the date of original issue thereof, whether or not (i) distributions on such shares are earned or declared or (ii) on any Quarterly Distribution Date there shall be funds legally available for the payment of distributions.  Distributions paid on the Series M-6 Preferred Shares in an amount less than the total amount of such distributions at the time accrued and payable on such shares shall be allocated pro rata on a per share basis among all such shares at the time outstanding.

The amount of any distributions accrued on any Series M-6 Preferred Shares at any Quarterly Distribution Date shall be the amount of any unpaid distributions accumulated thereon, to and including such Quarterly Distribution Date, whether or not earned or declared, and the amount of distributions accrued on any Series M-6 Preferred Shares at any date other than a Quarterly Distribution Date shall be equal to the sum of the amount of any unpaid distributions accumulated thereon, to and including the last preceding Quarterly Distribution Date, whether or not earned or declared, plus an amount calculated on the basis of the annual distribution rate of $3.8125 for the period after such last preceding Quarterly Distribution Date to and including the date as of which the calculation is made based on a 360-day year of twelve 30-day months.

In determining whether a distribution (other than upon voluntary or involuntary liquidation), by dividend, redemption or other acquisition of shares of beneficial interest of the Trust or otherwise, is permitted under Maryland law, amounts that would be needed, if the Trust were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of holders of Series M-6 Preferred Shares will not be added to the Trust’s total liabilities.

Except as provided in these terms of the Series M-6 Preferred Shares, the Series M-6 Preferred Shares shall not be entitled to participate in the earnings or assets of the Trust.

(4)Liquidation Rights.

(a)Upon the voluntary or involuntary dissolution, liquidation or winding up of the Trust, the holders of the Series M-6 Preferred Shares then outstanding shall be entitled to receive and to be paid out of the assets of the Trust available for distribution to its shareholders, before any payment or distribution shall be made on any Junior Shares, the amount of $50.00 per Series M-6 Preferred Share, plus accrued and unpaid distributions thereon.

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(b)After the payment to the holders of the Series M-6 Preferred Shares of the full preferential amounts provided for in this paragraph B, the holders of the Series M-6 Preferred Shares as such shall have no right or claim to any of the remaining assets of the Trust.

(c)If, upon any voluntary or involuntary dissolution, liquidation or winding up of the Trust, the amounts payable with respect to the preference value of the Series M-6 Preferred Shares and any other shares of beneficial interest of the Trust ranking as to any such distribution on parity with the Series M-6 Preferred Shares are not paid in full, the holders of the Series M-6 Preferred Shares and of such other shares will share ratably in any such distribution of assets of the Trust in proportion to the full respective preference amounts to which they are entitled.

(d)Neither the sale of all or substantially all of the property or business of the Trust, nor the merger or consolidation of the Trust into or with any other entity or the merger or consolidation of any other entity into or with the Trust, shall be deemed to be a dissolution, liquidation or winding up, voluntary or involuntary, for purposes of this paragraph B.

(5)Redemption.

(a)Optional Redemption.  On and after June 22, 2006, the Trust may, at its option, redeem at any time all or, from time to time, part of the Series M-6 Preferred Shares at a price per share (the “Series M-6 Redemption Price”), payable in cash, of $50.00 per Series M-6 Preferred Share, together with all accrued and unpaid distributions to and including the date fixed for redemption (the “Series M-6 Redemption Date”), subject to the provisions of paragraph 7 herein.

(b)Procedures for Redemption.

(i)Notice of any redemption will be mailed by the Trust, postage prepaid, or sent via overnight delivery service, not less than 30 days nor more than 60 days prior to the Series M-6 Redemption Date, addressed to the holders of record of the Series M-6 Preferred Shares to be redeemed at their addresses as they appear on the share transfer records of the Trust.  No failure to give such notice or any defect therein or in the mailing thereof shall affect the validity of the proceedings for the redemption of any Series M-6 Preferred Shares except as to the holder to whom the Trust has failed to give notice or except as to the holder to whom notice was defective.  In addition to any information required by law or by the applicable rules of any exchange upon which Series M-6 Preferred Shares may be listed or admitted to trading, such notice shall state: (a) the Series M-6 Redemption Date; (b) the Series M-6 Redemption Price; (c) the number of Series M-6 Preferred Shares to be redeemed; (d) the place or places where certificates for such shares are to be surrendered for payment of the Series M-6 Redemption

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Price; and (e) that distributions on the shares to be redeemed will cease to accumulate on the Series M-6 Redemption Date.

(ii)If notice has been mailed in accordance with subparagraph (5)(b)(i) above and provided that on or before the Series M-6 Redemption Date specified in such notice all funds necessary for such redemption shall have been irrevocably set aside by the Trust, separate and apart from its other funds in trust for the pro rata benefit of the holders of the Series M-6 Preferred Shares so called for redemption, so as to be, and to continue to be available therefor, then, from and after the Series M-6 Redemption Date (unless the Trust defaults in the payment of the Series M-6 Redemption Price), distributions on the Series M-6 Preferred Shares so called for redemption shall cease to accumulate, and said shares shall no longer be deemed to be outstanding and shall not have the status of Series M-6 Preferred Shares and all rights of the holders thereof as shareholders of the Trust (except the right to receive the Series M-6 Redemption Price) shall cease. If payment of the Series M-6 Preferred Shares is improperly withheld or refused and not paid by the Trust, distributions on such Series M-6 Preferred Shares will continue to accumulate from the original redemption date to the date of payment, in which case the actual payment date will be considered the date fixed for redemption for purposes of calculating the applicable Series M-6 Redemption Price.  Upon surrender, in accordance with said notice, of the certificates for any Series M-6 Preferred Shares so redeemed (properly endorsed or assigned for transfer, if the Trust shall so require and the notice shall so state), such Series M-6 Preferred Shares shall be redeemed by the Trust at the Series M-6 Redemption Price.  In case fewer than all the Series M-6 Preferred Shares evidenced by any such certificate are redeemed, a new certificate or certificates shall be issued evidencing the unredeemed Series M-6 Preferred Shares without cost to the holder thereof.

(iii)Any funds deposited with a bank or trust company for the purpose of redeeming Series M-6 Preferred Shares shall be irrevocable except that:

(A)the Trust shall be entitled to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and the holders of any shares redeemed shall have no claim to such interest or other earnings; and

(B)any balance of monies so deposited by the Trust and unclaimed by the holders of the Series M-6 Preferred Shares entitled thereto at the expiration of two years from the applicable Series M-6 Redemption Date shall be repaid, together with any interest or other earnings earned thereon, to the Trust, and after any such repayment, the holders of the shares entitled to the

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funds so repaid to the Trust shall look only to the Trust for payment without interest or other earnings.

(iv)No Series M-6 Preferred Shares may be redeemed except with funds legally available for the payment of the Series M-6 Redemption Price.

(v)Unless full accumulated distributions on all Series M-6 Preferred Shares shall have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past Distribution Periods and the then current Distribution Period, no Series M-6 Preferred Shares shall be redeemed (unless all outstanding Series M-6 Preferred Shares are simultaneously redeemed) or purchased or otherwise acquired directly or indirectly (except by conversion into or exchange for shares of beneficial interest of the Trust ranking junior to the Series M-6 Preferred Shares as to distributions and upon liquidation); provided, however, that the foregoing shall not prevent the redemption of Series M-6 Preferred Shares pursuant to Article VII of the Declaration of Trust or the purchase or acquisition of Series M-6 Preferred Shares.

(vi)If the Series M-6 Redemption Date is after a Record Date and before the related Quarterly Distribution Date, the distribution payable on such Quarterly Distribution Date shall be paid to the holder in whose name the Series M-6 Preferred Shares to be redeemed are registered at the close of business on such Record Date notwithstanding the redemption thereof between such Record Date and the related Quarterly Distribution Date or the Trust’s default in the payment of the distribution due.

(vii)In case of redemption of less than all Series M-6 Preferred Shares at the time outstanding, the Series M-6 Preferred Shares to be redeemed shall be selected pro rata from the holders of record of such shares in proportion to the number of Series M-6 Preferred Shares held by such holders (with adjustments to avoid redemption of fractional shares) or by any other equitable method determined by the Trust.

(6)Voting Rights.  Except as provided in these terms of the Series M-6 Preferred Shares, the holders of the Series M-6 Preferred Shares shall not be entitled to vote at any meeting of the shareholders for election of trustees or for any other purposes or otherwise to participate in any action taken by the Trust or the shareholders thereof, or to receive notice (except for such notice as required by law) of any meeting of shareholders.

(a)In any matter in which the Series M-6 Preferred Shares are entitled to vote (as expressly provided herein), including any action by written consent, each Series M-6 Preferred Share shall be entitled to 10 votes, each of which 10 votes may be directed separately by the holder thereof (or by any proxy or proxies of such holder).  With respect to each Series M-6 Preferred Share, the holder thereof may designate up to 10 proxies, with each such proxy having the right to vote a whole number of votes (totaling 10 votes per Series M-6 Preferred Share).

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(b)Whenever distributions on any Series M-6 Preferred Shares shall be in arrears for six or more quarterly periods, the holders of such Series M-6 Preferred Shares, voting separately as a class with all other series of Preferred Shares upon which like voting rights have been conferred and are exercisable, will be entitled to vote for the election of two additional Trustees of the Trust at a special meeting called by the holders of record of at least ten percent (10%) of any series of Preferred Shares so in arrears (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the shareholders) or at the next annual meeting of shareholders, and at each subsequent annual meeting until all distributions accumulated on such Series M-6 Preferred Shares for the past distribution periods and the then current distribution period shall have been fully paid or declared and a sum sufficient for the payment thereof set aside for payment.  In such case, the entire Board of Trustees of the Trust will be increased by two Trustees.

(c)So long as any Series M-6 Preferred Shares remain outstanding, the Trust will not, without the affirmative vote or consent of the holders of at least two-thirds of the Series M-6 Preferred Shares outstanding at the time, given in person or by proxy, either in writing or at a meeting (such series voting separately as a class), (i) authorize or create, or increase the authorized or issued amount of, any class or series of shares of beneficial interest ranking senior to the Series M-6 Preferred Shares with respect to the payment of distributions or the distribution of assets upon liquidation, dissolution or winding up or reclassify any authorized shares of beneficial interest of the Trust into such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or (ii) amend, alter or repeal the provisions of the Trust’s Declaration of Trust or the terms of the Series M-6 Preferred Shares whether by merger, consolidation or otherwise (an “Event”), so as to materially and adversely affect any right, preference, privilege or voting power of the Series M-6 Preferred Shares or the holders thereof; provided, however, with respect to the occurrence of any Events set forth in (ii) above, so long as the Series M-6 Preferred Shares remain outstanding with the terms thereof materially unchanged, taking into account that upon the occurrence of an Event, the Trust may not be the surviving entity or the Series M-6 Preferred Shares that remain outstanding may bear a new title, designation and/or be issued by a different issuer, the occurrence of any such Event shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting power of holders of Series M-6 Preferred Shares and provided further that (x) any increase in the amount of the authorized Preferred Shares or the creation or issuance of any other Series M-6 Preferred Shares, or (y) any increase in the amount of authorized Series M-6 Preferred Shares or any other Preferred Shares, in each case ranking on a parity with or junior to the Series M-6 Preferred Shares with respect to payment of distributions or the distribution of assets upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting powers.

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The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding Series M-6 Preferred Shares shall have been redeemed or called for redemption and sufficient funds shall have been deposited in trust to effect such redemption.

(7)Conversion.  Holders of Series M-6 Preferred Shares shall have the right to convert all or a portion of such shares into Common Shares, as follows:

(a)Subject to and upon compliance with the provisions of this subparagraph (7), a holder of Series M-6 Preferred Shares shall have the right, at his or her option, at any time after June 22, 2011 to convert such shares into the number of fully paid and non-assessable Common Shares obtained by dividing the aggregate liquidation preference of such shares by the Conversion Price (as in effect at the time and on the date provided for in the last paragraph of subsection (b) of this subparagraph (7)) by surrendering such shares to be converted, such surrender to be made in the manner provided in subsection (b) of this subparagraph (7); provided, however, that a holder of Series M-6 Preferred Shares shall have the right to convert such shares as provided above, at his or her option, at any time subsequent to such shares being called for redemption pursuant to subparagraph (5), which right to convert such shares upon a call for redemption shall terminate at the close of business on the fifth Business Day preceding the Series M-6 Redemption Date fixed for such redemption, unless the Trust shall default in making payment of the Common Shares and any cash payable upon such redemption under subparagraph (5) hereof, in which case the holders will retain the conversion rights provided herein, and provided further that, prior to such time as the Series M-6 Preferred Shares have been registered for resale with the United States Securities and Exchange Commission and listed for trading on the NYSE or the NASDAQ National Market, the Series M-6 Preferred Shares shall be convertible in whole, but not in part, with respect to all of the outstanding Series M-6 Preferred Shares.

(b)In order to exercise the conversion right, the holder of each Series M-6 Preferred Share to be converted shall surrender the certificate representing such share, duly endorsed or assigned to the Trust or in blank, at the office of the Transfer Agent, accompanied by written notice to the Trust that the holder thereof elects to convert such Series M-6 Preferred Share delivered to the Trust by (a) fax and (b) certified mail postage prepaid or overnight delivery to:  Equity Residential Properties Trust, Two North Riverside Plaza, Suite 400, Chicago, Illinois 60606, Attention: Bruce C. Strohm, facsimile number (312) 454-0039.  Unless the shares issuable on conversion are to be issued in the same name as the name in which such Series M-6 Preferred Share is registered, each share surrendered for conversion shall be accompanied by instruments of transfer, in form satisfactory to the Trust, duly executed by the holder or such holder’s duly authorized attorney and an amount sufficient to pay any transfer or similar tax (or evidence reasonably satisfactory to the Trust demonstrating that such taxes have been paid).

Holders of Series M-6 Preferred Shares at the close of business on a distribution payment record date shall be entitled to receive the distribution payable on such

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shares on the corresponding Quarterly Distribution Date notwithstanding the conversion thereof following such distribution payment record date and prior to such Quarterly Distribution Date.  However, Series M-6 Preferred Shares surrendered for conversion during the period between the close of business on any distribution payment record date and the opening of business on the corresponding Quarterly Distribution Date (except shares converted after the issuance of notice of redemption with respect to a Series M-6 Redemption Date during such period or coinciding with such Quarterly Distribution Date, such Series M-6 Preferred Shares being entitled to such distribution on the Quarterly Distribution Date) must be accompanied by payment of a pro rata portion of the distribution payable on such shares on such Quarterly Distribution Date equal to the product of (i) the amount of the quarterly distribution multiplied by (ii) a fraction, the numerator of which is the number of days beginning on the date of surrender of such Series M-6 Preferred Shares as provided in the preceding paragraph and ending on the Quarterly Distribution Date, and the denominator of which is 90.  A holder of Series M-6 Preferred Shares on a distribution payment record date who (or whose transferees) tenders any such shares for conversion into Common Shares on such Quarterly Distribution Date will receive the distribution payable by the Trust on such Series M-6 Preferred Shares on such date, and the converting holder need not include payment of the amount of such distribution upon surrender of Series M-6 Preferred Shares for conversion.  Except as provided above, the Trust shall make no payment or allowance for unpaid distributions, whether or not in arrears, on converted shares or for distributions on the Common Shares issued upon such conversion.

As promptly as practicable after the surrender of certificates representing Series M-6 Preferred Shares as aforesaid, the Trust shall issue and shall deliver at such office to such holder, or on his or her written order, a certificate or certificates for the number of full Common Shares issuable upon the conversion of such shares in accordance with the provisions of this subparagraph (7), and any fractional interest in respect of a Common Share arising upon such conversion shall be settled as provided in subsection (c) of this subparagraph (7).

Each conversion shall be deemed to have been effected immediately prior to the close of business on the date on which the certificates for Series M-6 Preferred Shares shall have been surrendered and such notice (and if applicable, payment of an amount equal to the distribution payable on such shares) received by the Trust as aforesaid, and the person or persons in whose name or names any certificate or certificates for Common Shares shall be issuable upon such conversion shall be deemed to have become the holder or holders of record of the shares represented thereby at such time on such date, and such conversion shall be at the Conversion Price in effect at such time and on such date unless the share transfer books of the Trust shall be closed on that date, in which event such person or persons shall be deemed to have become such holder or holders of record at the close of business on the next succeeding day on which such share transfer books are open, but such conversion shall be at the Conversion Price in effect on the date on which such shares have been surrendered and such notice received by the Trust.

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(c)No fractional shares or scrip representing fractions of Common Shares shall be issued upon conversion of the Series M-6 Preferred Shares.  Instead of any fractional interest in a Common Share that would otherwise be deliverable upon the conversion of a share of Series M-6 Preferred Shares, the Trust shall pay to the holder of such share an amount in cash based upon the Current Market Price of the Common Shares on the Trading Day immediately preceding the date of conversion.  If more than one Series M-6 Preferred Share shall be surrendered for conversion at one time by the same holder, the number of full Common Shares issuable upon conversion thereof shall be computed on the basis of the aggregate number of Series M-6 Preferred Shares so surrendered.

(d)The Conversion Price shall be adjusted from time to time as follows:

(i)If the Trust shall after the Issue Date (A) pay a distribution or make a distribution on its shares of beneficial interest in Common Shares, (B) subdivide its outstanding Common Shares into a greater number of shares, (C) combine its outstanding Common Shares into a smaller number of shares, or (D) issue any shares of beneficial interest by reclassification of its Common Shares, the Conversion Price in effect at the opening of business on the day following the date fixed for the determination of shareholders entitled to receive such distribution or at the opening of business on the day following the day on which such subdivision, combination or reclassification becomes effective, as the case may be, shall be adjusted so that the holder of any Series M-6 Preferred Shares thereafter surrendered for conversion shall be entitled to receive the number of Common Shares that such holder would have owned or have been entitled to receive after the happening of any of the events described above had such shares been converted immediately prior to the record date in the case of a distribution or the effective date in the case of a subdivision, combination or reclassification.  An adjustment made pursuant to this subsection (i) shall become effective immediately after the opening of business on the day next following the record date (except as provided in paragraph (h) below) in the case of a distribution and shall become effective immediately after the opening of business on the day next following the effective date in the case of a subdivision, combination or reclassification.

(ii)If the Trust shall issue after the Issue Date rights, options or warrants to all holders of Common Shares entitling them (for a period expiring within 45 days after the record date mentioned below) to subscribe for or purchase Common Shares at a price per share less than the Fair Market Value per Common Share on the record date for the determination of shareholders entitled to receive such rights, options or warrants, then the Conversion Price in effect at the opening of business on the day next following such record date shall be adjusted to equal the price determined by multiplying (I) the Conversion Price in effect immediately prior to the opening of business on the day following the date fixed for such determination by (II) a fraction, the numerator of which shall be the sum of (A) the number of Common Shares outstanding on the close of business on the date fixed for such determination and (B) the number of shares that the aggregate proceeds to the Trust from the exercise of such rights, options or warrants for

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Common Shares would purchase at such Fair Market Value, and the denominator of which shall be the sum of (A) the number of Common Shares outstanding on the close of business on the date fixed for such determination and (B) the number of additional Common Shares offered for subscription or purchase pursuant to such rights, options or warrants.  Such adjustment shall become effective immediately after the opening of business on the day next following such record date (except as provided in subsection (h) below).  In determining whether any rights, options or warrants entitle the holders of Common Shares to subscribe for or purchase Common Shares at less than the Fair Market Value, there shall be taken into account any consideration received by the Trust upon issuance and upon exercise of such rights, options or warrants, the value of such consideration, if other than cash, to be determined by the Chief Executive Officer or the Board of Trustees.

(iii)If the Trust shall distribute to all holders of its Common Shares any shares of beneficial interest of the Trust (other than Common Shares) or evidence of its indebtedness or assets (excluding cash distributions paid out of the total equity applicable to Common Shares, including revaluation equity, less the amount of stated capital attributable to Common Shares, determined on the basis of the most recent annual and quarterly consolidated cost basis balance sheets of the Trust and its consolidated subsidiaries available at the time of the declaration of the distribution) or rights or warrants to subscribe for or purchase any of its securities (excluding those rights and warrants issued to all holders of Common Shares entitling them for a period expiring within 45 days after the record date referred to in subsection (ii) above to subscribe for or purchase Common Shares, which rights and warrants are referred to in and treated under subsection (ii) above) (any of the foregoing being hereinafter in this subsection (iii) called the “Securities”), then in each case the Conversion Price shall be adjusted so that it shall equal the price determined by multiplying (I) the Conversion Price in effect immediately prior to the close of business on the date fixed for the determination of shareholders entitled to receive such distribution by (II) a fraction, the numerator of which shall be the Fair Market Value per Common Share on the record date mentioned below less the then fair market value (as determined by the Chief Executive Officer or the Board of Trustees, whose determination shall be conclusive) of the portion of the shares of beneficial interest or assets or evidences of indebtedness so distributed or of such rights or warrants applicable to one Common Share, and the denominator of which shall be the Fair Market Value per Common Share on the record date mentioned below.  Such adjustment shall become effective immediately at the opening of business on the Business Day next following (except as provided in subsection (h) below) the record date for the determination of shareholders entitled to receive such distribution.  For the purposes of this subsection (iii), the distribution of a Security, which is distributed not only to the holders of the Common Shares on the date fixed for the determination of shareholders entitled to such distribution of such Security, but also is distributed with each Common Share delivered to a Person converting a Series M-6 Preferred Share after such determination date, shall not require an adjustment of the Conversion Price pursuant to this subsection (iii); provided that on the date, if any, on which a person converting a Series M-6 Preferred Share would no longer be

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entitled to receive such Security with a Common Share (other than as a result of the termination of all such Securities), a distribution of such Securities shall be deemed to have occurred, and the Conversion Price shall be adjusted as provided in this subsection (iii) (and such day shall be deemed to be “the date fixed for the determination of the shareholders entitled to receive such distribution” and “the record date” within the meaning of the two preceding sentences).

(iv)No adjustment in the Conversion Price shall be required unless such adjustment would require a cumulative increase or decrease of at least 1% in such price; provided, however, that any adjustments that by reason of this subsection (iv) are not required to be made shall be carried forward and taken into account in any subsequent adjustment until made; and provided, further, that any adjustment shall be required and made in accordance with the provisions of this subparagraph (7) (other than this subsection (iv)) not later than such time as may be required in order to preserve the tax-free nature of a distribution to the holders of Common Shares.  Notwithstanding any other provisions of this subparagraph (7), the Trust shall not be required to make any adjustment of the Conversion Price for the issuance of any Common Shares pursuant to any plan providing for the reinvestment of distributions or interest payable on securities of the Trust and the investment of additional optional amounts in Common Shares under such plan.  All calculations under this subparagraph (7) shall be made to the nearest cent with ($.005 being rounded upward) or to the nearest one-tenth of a share (with .05 of a share being rounded upward), as the case may be.  Anything in this subsection (d) to the contrary notwithstanding, the Trust shall be entitled, to the extent permitted by law, to make such reductions in the Conversion Price, in addition to those required by this subsection (d), as it in its discretion shall determine to be advisable in order that any share distributions, subdivision of shares, reclassification or combination of shares, distribution of rights, options or warrants to purchase shares or securities, or a distribution of other assets (other than cash distributions) hereafter made by the Trust to its shareholders shall not be taxable.

(e)If the Trust shall be a party to any transaction (including, without limitation, a merger, consolidation, statutory share exchange, self tender offer for all or substantially all of the Common Shares, sale of all or substantially all of the Trust’s assets or recapitalization of the Common Shares and excluding any transaction as to which subsection (d)(i) of this subparagraph (7) applied) (each of the foregoing being referred to herein as a “Transaction”), in each case as a result of which Common Shares shall be converted into the right to receive shares, stock, securities or other property (including cash or any combination thereof), each Series M-6 Preferred Share which is not converted into the right to receive shares, stock, securities or other property in connection with such Transaction shall thereafter be convertible into the kind and amount of shares, stock, securities and other property (including cash or any combination thereof) receivable upon the consummation of such Transaction by a holder of that number of Common Shares into which one Series M-6 Preferred Share was convertible immediately prior to such Transaction, assuming such holder of Common Shares (i) is not a Person with which the Trust consolidated or into which the Trust merged or which merged into the Trust or to

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which such sale or transfer was made, as the case may be (a “Constituent Person”), or an affiliate of a Constituent Person and (ii) failed to exercise his or her rights of the election, if any, as to the kind or amount of shares, stock, securities and other property (including cash) receivable upon such Transaction (provided that if the kind or amount of shares, stock, securities and other property (including cash) receivable upon such Transaction is not the same for each Common Share of the Trust held immediately prior to such Transaction by other than a Constituent Person or an affiliate thereof and in respect of which such rights of election shall not have been exercised (the “Non-Electing Share”), then for purposes of this paragraph (e) the kind and amount of shares, securities and other property (including cash) receivable upon such Transaction by each Non-Electing Share shall be deemed to be the kind and amount so receivable per share by a plurality of the Non-Electing Shares). The Trust shall not be a party to any Transaction unless the terms of such Transaction are consistent with the provisions of this subsection (e), and it shall not consent or agree to the occurrence of any Transaction until the Trust has entered into an agreement with the successor or purchasing entity, as the case may be, for the benefit of the holders of the Series M-6 Preferred Shares that will contain provisions enabling the holders of the Series M-6 Preferred Shares that remain outstanding after such Transaction to convert into the consideration received by holders of Common Shares at the Conversion Price in effect immediately prior to such Transaction.  The provisions of this subsection (e) shall similarly apply to successive Transactions.

(f)If:

(i)the Trust shall declare a distribution on the Common Shares (other than in cash out of the total equity applicable to Common Shares, including revaluation equity, less the amount of stated capital attributable to Common Shares, determined on the basis of the most recent annual and quarterly consolidated cost basis balance sheets of the Trust and its consolidated subsidiaries available at the time of the declaration of the distribution); or

(ii)the Trust shall authorize the granting to the holders of the Common Shares of rights or warrants to subscribe for or purchase any shares of any class or any other rights or warrants; or

(iii)there shall be any reclassifications of the Common Shares (other than an event to which subsection (d)(i) of this subparagraph (7) applied) or any consolidation or merger to which the Trust is a party and for which approval of any shareholders of the Trust is required, or a statutory share exchange involving the conversion or exchange of Common Shares into securities or other property, or a self tender offer by the Trust for all or substantially all of its outstanding Common Shares, or the sale or transfer of all or substantially all of the assets of the Trust as an entity and for which approval of any stockholder of the Trust is required; or

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(iv)there shall occur the voluntary or involuntary liquidation, dissolution or winding up of the Trust, then the Trust shall cause to be filed with the Transfer Agent and shall cause to be mailed to the holders of the Series M-6 Preferred Shares at their addresses as shown on the share records of the Trust, as promptly as possible, but at least 15 days prior to the applicable date hereinafter specified, a notice stating (A) the date on which a record is to be taken for the purpose of such distribution or rights or warrants, or, if a record is not to be taken, the date as of which the holders of Common Shares of record to be entitled to such distribution or rights or warrants are to be determined or (B) the date on which such reclassification, consolidation, merger, statutory share exchange, sale, transfer, liquidation, dissolution or winding up is expected to become effective, and the date as of which it is expected that holders of Common Shares of record shall be entitled to exchange their Common Shares for securities or other property, if any, deliverable upon such reclassification, consolidation, merger, statutory share exchange, sale, transfer, liquidation, dissolution or winding up.  Failure to give or receive such notice or any defect therein shall not affect the legality or validity of the proceedings described in this subparagraph (7).

(g)Whenever the Conversion Price is adjusted as herein provided, the Trust shall promptly file with the Transfer Agent and the Depository an officer’s certificate setting forth the Conversion Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment, which certificate shall be conclusive evidence of the correctness of such adjustment absent manifest error.  Promptly after delivery of such certificate, the Trust shall prepare a notice of such adjustment of the Conversion Price setting forth the adjusted Conversion Price and the effective date such adjustment becomes effective and shall mail such notice of such adjustment of the Conversion Price to the holder of each Series M-6 Preferred Share at such holder’s last address as shown on the share records of the Trust.

(h)In any case in which subsection (d) of this subparagraph (7) provides that an adjustment shall become effective on the date next following the record date for an event, the Trust may defer until the occurrence of such event (A) issuing to the holder of any Series M-6 Preferred Shares converted after such record date and before the occurrence of such event the additional Common Shares issuable upon such conversion by reason of the adjustment required by such event over and above the Common Shares issuable upon such conversion before giving effect to such adjustment and (B) fractionalizing any Series M-6 Preferred Share and/or paying to such holder any amount of cash in lieu of any fraction pursuant to subsection (c) of this subparagraph (7).

(i)There shall be no adjustment of the Conversion Price in case of the issuance of any shares of beneficial interest of the Trust in a reorganization, acquisition or other similar transaction except as specifically set forth in this subparagraph (7).  If any action or Transaction would require adjustment of the Conversion Price pursuant to more than one subsection of this subparagraph (7), only one adjustment shall be made, and such adjustment shall be the amount of adjustment that has the highest absolute value.

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(j)If the Trust shall take any action affecting the Common Shares, other than action described in this subparagraph (7), that in the opinion of the Board of Trustees would materially adversely affect the conversion rights of the holders of the Series M-6 Preferred Shares, the Conversion Price for the Series M-6 Preferred Shares may be adjusted, to the extent permitted by law, in such manner, if any, and at such time, as the Board of Trustees, in its sole discretion, may determine to be equitable in the circumstances.

(k)The Trust covenants that it will at all times reserve and keep available, free from preemptive rights, out of the aggregate of its authorized but issued Common Shares, for the purpose of affecting conversion of the Series M-6 Preferred Shares, the full number of Common Shares deliverable upon the conversion of all outstanding Series M-6 Preferred Shares not theretofore converted.  For purposes of this subsection (k), the number of Common Shares that shall be deliverable upon the conversion of all outstanding Series M-6 Preferred Shares shall be computed as if at the time of computation all such outstanding shares were held by a single holder.

The Trust covenants that any Common Shares issued upon conversion of the Series M-6 Preferred Shares shall be validly issued, fully paid and non-assessable.  Before taking any action that would cause an adjustment reducing the Conversion Price below the then-par value of the Common Shares deliverable upon conversion of  the Series M-6 Preferred Shares, the Trust will take any action that, in the opinion of its counsel, may be necessary in order that the Trust may validly and legally issue fully paid and nonassessable Common Shares at such adjusted Conversion Price.

The Trust shall endeavor to list the Common Shares required to be delivered upon conversion of the Series M-6 Preferred Shares, prior to such delivery, upon each national securities exchange, if any, upon which the outstanding Common Shares are listed at the time of such delivery.

Prior to the delivery of any securities that the Trust shall be obligated to deliver upon conversion of the Series M-6 Preferred Shares, the Trust shall endeavor to comply with all federal and state laws and regulations thereunder requiring the registration of such securities with, or any approval of or consent to the delivery thereof by any governmental authority.

(l)The Trust will pay any and all documentary stamp or similar issue or transfer taxes payable in respect of the issue or delivery of Common Shares or other securities or property on conversion of the Series M-6 Preferred Shares pursuant hereto; provided, however, that the Trust shall not be required to pay any tax that may be payable in respect of any transfer involved in the issue or delivery of Common Shares or other securities or property in a name other than that of title holder of the Series M-6 Preferred Shares to be converted, and no such issue or delivery shall be made unless and until the person requesting such issue or delivery

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has paid to the Trust the amount of any such tax or established, to the reasonable satisfaction of the Trust, that such tax has been paid.

(m)In addition to the foregoing adjustments, the Company will be permitted to make such reductions in the Conversion Price as it considers to be advisable in order that any event treated for federal income tax purposes as a dividend of stock or stock rights will not be taxable to the holders of the Common Shares.

C.Restrictions on Transfer.  The Series M-6 Preferred Shares shall be subject to the restrictions on transfer and ownership of Shares in Article VII of the Declaration of Trust, as supplemented below.

(1)Certain Definitions.

For purposes of the Series M-6 Preferred Shares the following terms shall have the following meanings:

“Closing Date of the Series M-6 Preferred Shares Offering” shall mean the time and date of payment for and delivery of Series M-6 Preferred Shares issued pursuant to the conversion of Series I Preference Units.

“Special Triggering Event” shall mean either (i) the redemption or purchase by the Trust of all or a portion of the outstanding shares of beneficial interest in the Trust, or (ii) a change in the value of the Series M-6 Preferred Shares relative to any other class of beneficial interest in the Trust.

(2)Special Triggering Event.If during the period commencing on the Closing Date of the Series M-6 Preferred Shares Offering and prior to the Restriction Termination Date, a Special Triggering Event (if effective) or other event or occurrence (if effective) would result in any violation of section 7.2(a) of the Trust’s Declaration of Trust, then (i) the number of Series M-6 Preferred Shares (rounded up to the nearest whole share) that would (but for this section) cause any Person to Beneficially Own either Series M-6 Preferred Shares, or to Beneficially Own Series M-6 Preferred Shares and any other shares of beneficial interest in the Trust, in violation of section 7.2(a) shall be treated as provided in Article VII.  Such treatment shall be effective as of the close of business on the Business Day prior to the date of the Special Triggering Event or other event or occurrence.

(3)Ambiguity.In the case of an ambiguity in the application of any of the provisions of this section, including any definition contained in paragraph (1), the Board of Trustees shall have the power to determine the application of this section with respect to any situation based on the facts known to it (subject, however, to the provisions of Section 7.2(a)).

(4)Exclusion of Other Rights.

The Series M-6 Preferred Shares shall not have any voting powers, preferences and relative, participating, optional or other special rights, other than those specifically set forth in these

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terms of the Series M-6 Preferred Shares (as such terms may be amended from time to time) and in the Declaration of Trust.  The Series M-6 Preferred Shares shall have no preemptive or subscription rights.

(5)Headings of Subdivisions.

The headings of the various subdivisions hereof are for convenience of reference only and shall not affect the interpretation of any of the provisions hereof.

(6)Severability of Provisions.

If any voting powers, preferences and relative, participating, optional and other special rights of the Series M-6 Preferred Shares and qualifications, limitations and restrictions thereof set forth in these terms of the Series M-6 Preferred Shares (as such terms may be amended from time to time) is invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, all other voting powers, preferences and relative, participating, optional and other special rights of Series M-6 Preferred Shares and qualifications, limitations and restrictions thereof set forth in these terms of the Series M-6 Preferred Shares (as so amended), which can be given effect without the invalid, unlawful or unenforceable voting powers, preferences, and relative, participating, optional or other special rights of Series M-6 Preferred Shares and qualifications, limitations and restrictions thereof herein set forth, shall nevertheless, remain in full force and effect and no preferences or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of the Series M-6 Preferred Shares herein set forth shall be deemed dependent upon any other such voting powers, preferences and relative, participating, optional or other special rights of Series M-6 Preferred Shares and qualifications, limitations and restrictions thereof unless so expressed herein.

SECTION 13.16.Series M-7 Preferred Shares.

1.A.Certain Definitions.

Unless the context otherwise requires, the terms defined in this subparagraph A of paragraph 1 shall have, for all purposes of these terms of the Series M-7 Preferred Shares, the meanings herein specified (with terms defined in the singular having comparable meanings when used in the plural).

“Business Day” shall mean any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in New York City are authorized or required by law, regulation or executive order to close.

“Closing Date of the Series M-7 Preferred Shares Offering” shall have the meaning set forth in subparagraph (1) of paragraph C below.

“Code” shall mean the Internal Revenue Code of 1986, as amended.

“Common Shares” shall mean the common shares of beneficial interest, $.01 par  value per share, of the Trust.

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“Constituent Person” shall have the meaning set forth in subparagraph (7)(e) of paragraph B below.

“Conversion Price” shall mean the conversion price per Common Share for which the Series M-7 Preferred Shares are convertible, as such Conversion Price may be adjusted pursuant to subparagraph (7)(d) of paragraph (B) below. The initial conversion price shall be $35.44 per Common Share (equivalent to a conversion rate of 1.4108 Common Shares for each Series M-7 Preferred Share, with such Series M-7 Preferred Shares being ascribed their $50.00 liquidation value).

“Current Market Price” shall mean the current market price of publicly traded common shares or any other class of shares of beneficial interest or other security of the Trust or any other issuer for any day shall mean the last reported sales-price, regular way on such day or, if no sale takes place on such day, the average of the reported closing bid and asked prices on such day, regular way, in either case as reported on the New York Stock Exchange (“NYSE”) or, if such security is not listed or admitted for trading on the NYSE, on the principal national securities exchange on which such security is listed or admitted for trading or, if not listed or admitted for trading on any national securities exchange, on the NASDAQ National Market, or, if such security is not quoted on such NASDAQ National Market, the average of the closing bid and asked prices on such day in the over-the-counter-market as reported by NASDAQ or, if bid and asked prices for such security on such day shall not have been reported through NASDAQ, the average of the bid and asked prices on such day as furnished by any NYSE member firm regularly making a market in such security selected for such purpose by the Chief Executive Officer or the Board of Trustees, or, if such security is not then currently traded on any established market and no bid and asked prices for such security on such day shall be available, the Current Market Price shall be as determined in good faith by the Chief Executive Officer or the Board of Trustees.

“Declaration of Trust” shall have the meaning set forth in Article First of these Articles Supplementary.

“Distribution Period” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“Event” shall have the meaning set forth in subparagraph (6)(c) of paragraph B below.

“Fair Market Value” shall mean the average of the daily Current Market Prices for a Common Share during the five (5) consecutive Trading Days selected by the Trust commencing not more than twenty (20) Trading Days before, and ending not later than, the earlier of the day in question and the day before the “ex date” with respect to the issuance or distribution requiring such computation.  The term “ex date” when used with respect to any issuance or distribution means the first day on which the Common Shares trade regular way, without the right to receive such issuance or distribution, on the exchange or in the market, as the case may be, used to determine that day’s Current Market Price.

“Issue Date” shall mean the first date on which the Series J Preference Units are issued.

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“Junior Shares” shall have the meaning set forth in subparagraph (2) of paragraph B.

“Non-Electing Share” shall have the meaning set forth in subparagraph (7)(e) of paragraph B below.

“Person” shall mean an individual, corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code, joint stock company or other entity, and also includes a group as that term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended, but does not include an underwriter which participates in a public offering of the Series M-7 Preferred Shares; provided, that the ownership of Series M-7 Preferred Shares by such Underwriter would not result in the Trust being “closely held” within the meaning of Section 856(h) of the Code, or would otherwise result in the Trust failing to qualify as a REIT.

“Preferred Shares” shall mean shares of beneficial interest of the Trust designated as or otherwise on a parity with the Series M-7 Preferred Shares as to distributions and rights upon voluntary or involuntary liquidation, winding up or dissolution of the Trust as may be issued and outstanding from time to time, including Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares, Series E Preferred Shares, Series G Preferred Shares, Series H Preferred Shares, Series K Preferred Shares, Series L Preferred Shares, Series M Preferred Shares, Series M-1 Preferred Shares, Series M-2 Preferred Shares, Series M-3 Preferred Shares, Series M-4 Preferred Shares, Series M-5 Preferred Shares and Series M-6 Preferred Shares and any other shares so designated.

“Quarterly Distribution Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“Record Date” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“REIT” shall mean a Real Estate Investment Trust under Section 856 of the Code.

“Securities” shall have the meaning set forth in subparagraph (7)(d)(iii) of paragraph B below.

“Series J Preference Units” shall mean the 7.625% Series J Cumulative Convertible Redeemable Preference Units of Lexford Properties, L.P.

“Series M-7 Preferred Shares” shall have the meaning set forth in Article First of these Articles Supplementary.

“Series M-7 Redemption Date” shall have the meaning set forth in subparagraph (5) of paragraph B below.

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“Series M-7 Redemption Price” shall have the meaning set forth in subparagraph (5) of paragraph B below.

“Special Triggering Event” shall have the meaning set forth in subparagraph (1) of paragraph C below.

“Trading Day” shall mean any day on which the securities in question are traded on the NYSE, or if such securities are not listed or admitted for trading on the NYSE, on the principal national securities exchange on which such securities are listed or admitted, or if not listed or admitted for trading on any national securities exchange, on the NASDAQ National Market, or if such securities are not quoted on such NASDAQ National Market, in the applicable securities market in which the securities are traded.

“Transaction” shall have the meaning set forth in subparagraph (7)(e) of paragraph B below.

“Transfer Agent” shall mean Fleet National Bank, which may act through its affiliate, EquiServe Trust Company, N.A., or such other agent or agents of the Trust as may be designated by the Board of Trustees or their designee as the transfer agent for the Series M-7 Preferred Shares.

“Trust” shall have the meaning set forth in Article First of these Articles Supplementary.

All other capitalized terms used but not defined herein shall have the meanings ascribed to them in the Declaration of Trust.

B.Series M-7 Preferred Shares

(1)Number and Designation.  A series of Preferred Shares, consisting of 230,000 Preferred Shares designated as 7.625% Series M-7 Convertible Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $50.00 per share) (the “Series M-7 Preferred Shares”), is hereby established.

(2)Ranking.  In respect of rights to receive distributions and to participate in distributions or payments in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Trust, the Series M-7 Preferred Shares shall rank pari passu with any other Preferred Shares of the Trust, and will rank senior to the Common Shares and any other class or series of shares of beneficial interest of the Trust ranking, as to distributions and upon liquidation, junior (collectively, the “Junior Shares”) to the Preferred Shares.

(3)Distributions.  The holders of the then outstanding Series M-7 Preferred Shares shall be entitled to receive, when and as authorized by the Board of Trustees and declared by the Trust out of any funds legally available therefor, cumulative distributions at the rate of $3.8125 per share per year, payable in equal amounts of $.953125 per share quarterly in arrears in cash on the fifteenth day, or if not a Business Day, the next succeeding Business Day, of January, April, July and October in each year (each such day being hereinafter called a “Quarterly

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Distribution Date” and each period ending on a Quarterly Distribution Date being hereinafter called a “Distribution Period”), beginning on the first Quarterly Distribution Date following the issuance of the Series M-7 Preferred Shares, to shareholders of record at the close of business on such date as shall be fixed by the Board of Trustees at the time of declaration of the distribution (the “Record Date”), which shall not be less than 10 nor more than 30 days preceding the Quarterly Distribution Date.  The amount of any distribution payable for the initial Distribution Period and for any other Distribution Period shorter than a full Distribution Period shall be pro-rated and computed on the basis of a 360-day year of twelve 30-day months. Notwithstanding anything to the contrary set forth herein, if and when the holders of the Series J Lexford Preference Units exercise their right to convert the Series J Lexford Preference Units into Series M-7 Preferred Shares, the amount of any distribution payable for the initial Distribution Period shall include any and all amounts of distributions accrued but not yet paid on the Series J Lexford Preference Units in accordance with Section 9(B)(ii) of the Other Securities Term Sheet and Joinder to Amended and Restated Limited Partnership Agreement of Lexford Properties, L.P. Distributions on each Series M-7 Preferred Share shall accrue and be cumulative from and including the date of original issue thereof, whether or not (i) distributions on such shares are earned or declared or (ii) on any Quarterly Distribution Date there shall be funds legally available for the payment of distributions.  Distributions paid on the Series M-7 Preferred Shares in an amount less than the total amount of such distributions at the time accrued and payable on such shares shall be allocated pro rata on a per share basis among all such shares at the time outstanding.

The amount of any distributions accrued on any Series M-7 Preferred Shares at any Quarterly Distribution Date shall be the amount of any unpaid distributions accumulated thereon, to and including such Quarterly Distribution Date, whether or not earned or declared, and the amount of distributions accrued on any Series M-7 Preferred Shares at any date other than a Quarterly Distribution Date shall be equal to the sum of the amount of any unpaid distributions accumulated thereon, to and including the last preceding Quarterly Distribution Date, whether or not earned or declared, plus an amount calculated on the basis of the annual distribution rate of $3.8125 for the period after such last preceding Quarterly Distribution Date to and including the date as of which the calculation is made based on a 360-day year of twelve 30-day months.

In determining whether a distribution (other than upon voluntary or involuntary liquidation), by dividend, redemption or other acquisition of shares of beneficial interest of the Trust or otherwise, is permitted under Maryland law, amounts that would be needed, if the Trust were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of holders of Series M-7 Preferred Shares will not be added to the Trust’s total liabilities.

Except as provided in these terms of the Series M-7 Preferred Shares, the Series M-7 Preferred Shares shall not be entitled to participate in the earnings or assets of the Trust.

(4)Liquidation Rights.

(a)Upon the voluntary or involuntary dissolution, liquidation or winding up of the Trust, the holders of the Series M-7 Preferred Shares then outstanding shall be entitled to receive and to be paid out of the assets of the Trust available for distribution to its shareholders, before any payment or

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distribution shall be made on any Junior Shares, the amount of $50.00 per Series M-7 Preferred Share, plus accrued and unpaid distributions thereon.

(b)After the payment to the holders of the Series M-7 Preferred Shares of the full preferential amounts provided for in this paragraph B, the holders of the Series M-7 Preferred Shares as such shall have no right or claim to any of the remaining assets of the Trust.

(c)If, upon any voluntary or involuntary dissolution, liquidation or winding up of the Trust, the amounts payable with respect to the preference value of the Series M-7 Preferred Shares and any other shares of beneficial interest of the Trust ranking as to any such distribution on parity with the Series M-7 Preferred Shares are not paid in full, the holders of the Series M-7 Preferred Shares and of such other shares will share ratably in any such distribution of assets of the Trust in proportion to the full respective preference amounts to which they are entitled.

(d)Neither the sale of all or substantially all of the property or business of the Trust, nor the merger or consolidation of the Trust into or with any other entity or the merger or consolidation of any other entity into or with the Trust, shall be deemed to be a dissolution, liquidation or winding up, voluntary or involuntary, for purposes of this paragraph B.

(5)Redemption.

(a)Optional Redemption.  On and after December 14, 2006, the Trust may, at its option, redeem at any time all or, from time to time, part of the Series M-7 Preferred Shares at a price per share (the “Series M-7 Redemption Price”), payable in cash, of $50.00 per Series M-7 Preferred Share, together with all accrued and unpaid distributions to and including the date fixed for redemption (the “Series M-7 Redemption Date”), subject to the provisions of paragraph 7 herein.

(b)Procedures for Redemption.

(i)Notice of any redemption will be mailed by the Trust, postage prepaid, or sent via overnight delivery service, not less than 30 days nor more than 60 days prior to the Series M-7 Redemption Date, addressed to the holders of record of the Series M-7 Preferred Shares to be redeemed at their addresses as they appear on the share transfer records of the Trust.  No failure to give such notice or any defect therein or in the mailing thereof shall affect the validity of the proceedings for the redemption of any Series M-7 Preferred Shares except as to the holder to whom the Trust has failed to give notice or except as to the holder to whom notice was defective.  In addition to any information required by law or by the applicable rules of any exchange upon which Series M-7 Preferred Shares may be listed or admitted to trading, such notice shall state: (a) the Series M-7 Redemption Date; (b)

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the Series M-7 Redemption Price; (c) the number of Series M-7 Preferred Shares to be redeemed; (d) the place or places where certificates for such shares are to be surrendered for payment of the Series M-7 Redemption Price; and (e) that distributions on the shares to be redeemed will cease to accumulate on the Series M-7 Redemption Date.

(ii)If notice has been mailed in accordance with subparagraph (5)(b)(i) above and provided that on or before the Series M-7 Redemption Date specified in such notice all funds necessary for such redemption shall have been irrevocably set aside by the Trust, separate and apart from its other funds in trust for the pro rata benefit of the holders of the Series M-7 Preferred Shares so called for redemption, so as to be, and to continue to be available therefor, then, from and after the Series M-7 Redemption Date (unless the Trust defaults in the payment of the Series M-7 Redemption Price), distributions on the Series M-7 Preferred Shares so called for redemption shall cease to accumulate, and said shares shall no longer be deemed to be outstanding and shall not have the status of Series M-7 Preferred Shares and all rights of the holders thereof as shareholders of the Trust (except the right to receive the Series M-7 Redemption Price) shall cease. If payment of the Series M-7 Preferred Shares is improperly withheld or refused and not paid by the Trust, distributions on such Series M-7 Preferred Shares will continue to accumulate from the original redemption date to the date of payment, in which case the actual payment date will be considered the date fixed for redemption for purposes of calculating the applicable Series M-7 Redemption Price.  Upon surrender, in accordance with said notice, of the certificates for any Series M-7 Preferred Shares so redeemed (properly endorsed or assigned for transfer, if the Trust shall so require and the notice shall so state), such Series M-7 Preferred Shares shall be redeemed by the Trust at the Series M-7 Redemption Price.  In case fewer than all the Series M-7 Preferred Shares evidenced by any such certificate are redeemed, a new certificate or certificates shall be issued evidencing the unredeemed Series M-7 Preferred Shares without cost to the holder thereof.

(iii)Any funds deposited with a bank or trust company for the purpose of redeeming Series M-7 Preferred Shares shall be irrevocable except that:

(A)the Trust shall be entitled to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and the holders of any shares redeemed shall have no claim to such interest or other earnings; and

(B)any balance of monies so deposited by the Trust and unclaimed by the holders of the Series M-7 Preferred Shares entitled thereto at the expiration of two years from the applicable Series M-7 Redemption Date shall

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be repaid, together with any interest or other earnings earned thereon, to the Trust, and after any such repayment, the holders of the shares entitled to the funds so repaid to the Trust shall look only to the Trust for payment without interest or other earnings.

(iv)No Series M-7 Preferred Shares may be redeemed except with funds legally available for the payment of the Series M-7 Redemption Price.

(v)Unless full accumulated distributions on all Series M-7 Preferred Shares shall have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past Distribution Periods and the then current Distribution Period, no Series M-7 Preferred Shares shall be redeemed (unless all outstanding Series M-7 Preferred Shares are simultaneously redeemed) or purchased or otherwise acquired directly or indirectly (except by conversion into or exchange for shares of beneficial interest of the Trust ranking junior to the Series M-7 Preferred Shares as to distributions and upon liquidation); provided, however, that the foregoing shall not prevent the redemption of Series M-7 Preferred Shares pursuant to Article VII of the Declaration of Trust or the purchase or acquisition of Series M-7 Preferred Shares.

(vi)If the Series M-7 Redemption Date is after a Record Date and before the related Quarterly Distribution Date, the distribution payable on such Quarterly Distribution Date shall be paid to the holder in whose name the Series M-7 Preferred Shares to be redeemed are registered at the close of business on such Record Date notwithstanding the redemption thereof between such Record Date and the related Quarterly Distribution Date or the Trust’s default in the payment of the distribution due.

(vii)In case of redemption of less than all Series M-7 Preferred Shares at the time outstanding, the Series M-7 Preferred Shares to be redeemed shall be selected pro rata from the holders of record of such shares in proportion to the number of Series M-7 Preferred Shares held by such holders (with adjustments to avoid redemption of fractional shares) or by any other equitable method determined by the Trust.

(6)Voting Rights.  Except as provided in these terms of the Series M-7 Preferred Shares, the holders of the Series M-7 Preferred Shares shall not be entitled to vote at any meeting of the shareholders for election of trustees or for any other purposes or otherwise to participate in any action taken by the Trust or the shareholders thereof, or to receive notice (except for such notice as required by law) of any meeting of shareholders.

(a)In any matter in which the Series M-7 Preferred Shares are entitled to vote (as expressly provided herein), including any action by written consent, each Series M-7 Preferred Share shall be entitled to 10 votes, each of which 10 votes may be directed separately by the holder thereof (or by any proxy or

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proxies of such holder).  With respect to each Series M-7 Preferred Share, the holder thereof may designate up to 10 proxies, with each such proxy having the right to vote a whole number of votes (totaling 10 votes per Series M-7 Preferred Share).

(b)Whenever distributions on any Series M-7 Preferred Shares shall be in arrears for six or more quarterly periods, the holders of such Series M-7 Preferred Shares, voting separately as a class with all other series of Preferred Shares upon which like voting rights have been conferred and are exercisable, will be entitled to vote for the election of two additional Trustees of the Trust at a special meeting called by the holders of record of at least ten percent (10%) of any series of Preferred Shares so in arrears (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the shareholders) or at the next annual meeting of shareholders, and at each subsequent annual meeting until all distributions accumulated on such Series M-7 Preferred Shares for the past distribution periods and the then current distribution period shall have been fully paid or declared and a sum sufficient for the payment thereof set aside for payment.  In such case, the entire Board of Trustees of the Trust will be increased by two Trustees.

(c)So long as any Series M-7 Preferred Shares remain outstanding, the Trust will not, without the affirmative vote or consent of the holders of at least two-thirds of the Series M-7 Preferred Shares outstanding at the time, given in person or by proxy, either in writing or at a meeting (such series voting separately as a class), (i) authorize or create, or increase the authorized or issued amount of, any class or series of shares of beneficial interest ranking senior to the Series M-7 Preferred Shares with respect to the payment of distributions or the distribution of assets upon liquidation, dissolution or winding up or reclassify any authorized shares of beneficial interest of the Trust into such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or (ii) amend, alter or repeal the provisions of the Trust’s Declaration of Trust or the terms of the Series M-7 Preferred Shares whether by merger, consolidation or otherwise (an “Event”), so as to materially and adversely affect any right, preference, privilege or voting power of the Series M-7 Preferred Shares or the holders thereof; provided, however, with respect to the occurrence of any Events set forth in (ii) above, so long as the Series M-7 Preferred Shares remain outstanding with the terms thereof materially unchanged, taking into account that upon the occurrence of an Event, the Trust may not be the surviving entity or the Series M-7 Preferred Shares that remain outstanding may bear a new title, designation and/or be issued by a different issuer, the occurrence of any such Event shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting power of holders of Series M-7 Preferred Shares and provided further that (x) any increase in the amount of the authorized Preferred Shares or the creation or issuance of any other Series M-7 Preferred Shares, or (y) any

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increase in the amount of authorized Series M-7 Preferred Shares or any other Preferred Shares, in each case ranking on a parity with or junior to the Series M-7 Preferred Shares with respect to payment of distributions or the distribution of assets upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting powers.

The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding Series M-7 Preferred Shares shall have been redeemed or called for redemption and sufficient funds shall have been deposited in trust to effect such redemption.

(7)Conversion.  Holders of Series M-7 Preferred Shares shall have the right to convert all or a portion of such shares into Common Shares, as follows:

(a)Subject to and upon compliance with the provisions of this subparagraph (7), a holder of Series M-7 Preferred Shares shall have the right, at his or her option, at any time after December 14, 2011 to convert such shares into the number of fully paid and non-assessable Common Shares obtained by dividing the aggregate liquidation preference of such shares by the Conversion Price (as in effect at the time and on the date provided for in the last paragraph of subsection (b) of this subparagraph (7)) by surrendering such shares to be converted, such surrender to be made in the manner provided in subsection (b) of this subparagraph (7); provided, however, that a holder of Series M-7 Preferred Shares shall have the right to convert such shares as provided above, at his or her option, at any time subsequent to such shares being called for redemption pursuant to subparagraph (5), which right to convert such shares upon a call for redemption shall terminate at the close of business on the fifth Business Day preceding the Series M-7 Redemption Date fixed for such redemption, unless the Trust shall default in making payment of the Common Shares and any cash payable upon such redemption under subparagraph (5) hereof, in which case the holders will retain the conversion rights provided herein, and provided further that, prior to such time as the Series M-7 Preferred Shares have been registered for resale with the United States Securities and Exchange Commission and listed for trading on the NYSE or the NASDAQ National Market, the Series M-7 Preferred Shares shall be convertible in whole, but not in part, with respect to all of the outstanding Series M-7 Preferred Shares.

(b)In order to exercise the conversion right, the holder of each Series M-7 Preferred Share to be converted shall surrender the certificate representing such share, duly endorsed or assigned to the Trust or in blank, at the office of the Transfer Agent, accompanied by written notice to the Trust that the holder thereof elects to convert such Series M-7 Preferred Share delivered to the Trust by (a) fax and (b) certified mail postage prepaid or overnight delivery to:  Equity Residential Properties Trust, Two North Riverside Plaza,

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Suite 400, Chicago, Illinois 60606, Attention: Bruce C. Strohm, facsimile number (312) 454-0039.  Unless the shares issuable on conversion are to be issued in the same name as the name in which such Series M-7 Preferred Share is registered, each share surrendered for conversion shall be accompanied by instruments of transfer, in form satisfactory to the Trust, duly executed by the holder or such holder’s duly authorized attorney and an amount sufficient to pay any transfer or similar tax (or evidence reasonably satisfactory to the Trust demonstrating that such taxes have been paid).

Holders of Series M-7 Preferred Shares at the close of business on a distribution payment record date shall be entitled to receive the distribution payable on such shares on the corresponding Quarterly Distribution Date notwithstanding the conversion thereof following such distribution payment record date and prior to such Quarterly Distribution Date.  However, Series M-7 Preferred Shares surrendered for conversion during the period between the close of business on any distribution payment record date and the opening of business on the corresponding Quarterly Distribution Date (except shares converted after the issuance of notice of redemption with respect to a Series M-7 Redemption Date during such period or coinciding with such Quarterly Distribution Date, such Series M-7 Preferred Shares being entitled to such distribution on the Quarterly Distribution Date) must be accompanied by payment of a pro rata portion of the distribution payable on such shares on such Quarterly Distribution Date equal to the product of (i) the amount of the quarterly distribution multiplied by (ii) a fraction, the numerator of which is the number of days beginning on the date of surrender of such Series M-7 Preferred Shares as provided in the preceding paragraph and ending on the Quarterly Distribution Date, and the denominator of which is 90.  A holder of Series M-7 Preferred Shares on a distribution payment record date who (or whose transferees) tenders any such shares for conversion into Common Shares on such Quarterly Distribution Date will receive the distribution payable by the Trust on such Series M-7 Preferred Shares on such date, and the converting holder need not include payment of the amount of such distribution upon surrender of Series M-7 Preferred Shares for conversion.  Except as provided above, the Trust shall make no payment or allowance for unpaid distributions, whether or not in arrears, on converted shares or for distributions on the Common Shares issued upon such conversion.

As promptly as practicable after the surrender of certificates representing Series M-7 Preferred Shares as aforesaid, the Trust shall issue and shall deliver at such office to such holder, or on his or her written order, a certificate or certificates for the number of full Common Shares issuable upon the conversion of such shares in accordance with the provisions of this subparagraph (7), and any fractional interest in respect of a Common Share arising upon such conversion shall be settled as provided in subsection (c) of this subparagraph (7).

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Each conversion shall be deemed to have been effected immediately prior to the close of business on the date on which the certificates for Series M-7 Preferred Shares shall have been surrendered and such notice (and if applicable, payment of an amount equal to the distribution payable on such shares) received by the Trust as aforesaid, and the person or persons in whose name or names any certificate or certificates for Common Shares shall be issuable upon such conversion shall be deemed to have become the holder or holders of record of the shares represented thereby at such time on such date, and such conversion shall be at the Conversion Price in effect at such time and on such date unless the share transfer books of the Trust shall be closed on that date, in which event such person or persons shall be deemed to have become such holder or holders of record at the close of business on the next succeeding day on which such share transfer books are open, but such conversion shall be at the Conversion Price in effect on the date on which such shares have been surrendered and such notice received by the Trust.

(c)No fractional shares or scrip representing fractions of Common Shares shall be issued upon conversion of the Series M-7 Preferred Shares.  Instead of any fractional interest in a Common Share that would otherwise be deliverable upon the conversion of a share of Series M-7 Preferred Shares, the Trust shall pay to the holder of such share an amount in cash based upon the Current Market Price of the Common Shares on the Trading Day immediately preceding the date of conversion.  If more than one Series M-7 Preferred Share shall be surrendered for conversion at one time by the same holder, the number of full Common Shares issuable upon conversion thereof shall be computed on the basis of the aggregate number of Series M-7 Preferred Shares so surrendered.

(d)The Conversion Price shall be adjusted from time to time as follows:

(i)If the Trust shall after the Issue Date (A) pay a distribution or make a distribution on its shares of beneficial interest in Common Shares, (B) subdivide its outstanding Common Shares into a greater number of shares, (C) combine its outstanding Common Shares into a smaller number of shares, or (D) issue any shares of beneficial interest by reclassification of its Common Shares, the Conversion Price in effect at the opening of business on the day following the date fixed for the determination of shareholders entitled to receive such distribution or at the opening of business on the day following the day on which such subdivision, combination or reclassification becomes effective, as the case may be, shall be adjusted so that the holder of any Series M-7 Preferred Shares thereafter surrendered for conversion shall be entitled to receive the number of Common Shares that such holder would have owned or have been entitled to receive after the happening of any of the events described above had such shares been converted immediately prior to the record date in the case of a distribution or the effective date in the case of a subdivision, combination or reclassification.  An adjustment made pursuant to this subsection (i) shall become effective immediately after the opening of

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business on the day next following the record date (except as provided in paragraph (h) below) in the case of a distribution and shall become effective immediately after the opening of business on the day next following the effective date in the case of a subdivision, combination or reclassification.

(ii)If the Trust shall issue after the Issue Date rights, options or warrants to all holders of Common Shares entitling them (for a period expiring within 45 days after the record date mentioned below) to subscribe for or purchase Common Shares at a price per share less than the Fair Market Value per Common Share on the record date for the determination of shareholders entitled to receive such rights, options or warrants, then the Conversion Price in effect at the opening of business on the day next following such record date shall be adjusted to equal the price determined by multiplying (I) the Conversion Price in effect immediately prior to the opening of business on the day following the date fixed for such determination by (II) a fraction, the numerator of which shall be the sum of (A) the number of Common Shares outstanding on the close of business on the date fixed for such determination and (B) the number of shares that the aggregate proceeds to the Trust from the exercise of such rights, options or warrants for Common Shares would purchase at such Fair Market Value, and the denominator of which shall be the sum of (A) the number of Common Shares outstanding on the close of business on the date fixed for such determination and (B) the number of additional Common Shares offered for subscription or purchase pursuant to such rights, options or warrants.  Such adjustment shall become effective immediately after the opening of business on the day next following such record date (except as provided in subsection (h) below).  In determining whether any rights, options or warrants entitle the holders of Common Shares to subscribe for or purchase Common Shares at less than the Fair Market Value, there shall be taken into account any consideration received by the Trust upon issuance and upon exercise of such rights, options or warrants, the value of such consideration, if other than cash, to be determined by the Chief Executive Officer or the Board of Trustees.

(iii)If the Trust shall distribute to all holders of its Common Shares any shares of beneficial interest of the Trust (other than Common Shares) or evidence of its indebtedness or assets (excluding cash distributions paid out of the total equity applicable to Common Shares, including revaluation equity, less the amount of stated capital attributable to Common Shares, determined on the basis of the most recent annual and quarterly consolidated cost basis balance sheets of the Trust and its consolidated subsidiaries available at the time of the declaration of the distribution) or rights or warrants to subscribe for or purchase any of its securities (excluding those rights and warrants issued to all holders of Common Shares entitling them for a period expiring within 45 days after the record date referred to in subsection (ii) above to subscribe for or purchase Common Shares, which rights and warrants are referred to in and treated

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under subsection (ii) above) (any of the foregoing being hereinafter in this subsection (iii) called the “Securities”), then in each case the Conversion Price shall be adjusted so that it shall equal the price determined by multiplying (I) the Conversion Price in effect immediately prior to the close of business on the date fixed for the determination of shareholders entitled to receive such distribution by (II) a fraction, the numerator of which shall be the Fair Market Value per Common Share on the record date mentioned below less the then fair market value (as determined by the Chief Executive Officer or the Board of Trustees, whose determination shall be conclusive) of the portion of the shares of beneficial interest or assets or evidences of indebtedness so distributed or of such rights or warrants applicable to one Common Share, and the denominator of which shall be the Fair Market Value per Common Share on the record date mentioned below.  Such adjustment shall become effective immediately at the opening of business on the Business Day next following (except as provided in subsection (h) below) the record date for the determination of shareholders entitled to receive such distribution.  For the purposes of this subsection (iii), the distribution of a Security, which is distributed not only to the holders of the Common Shares on the date fixed for the determination of shareholders entitled to such distribution of such Security, but also is distributed with each Common Share delivered to a Person converting a Series M-7 Preferred Share after such determination date, shall not require an adjustment of the Conversion Price pursuant to this subsection (iii); provided that on the date, if any, on which a person converting a Series M-7 Preferred Share would no longer be entitled to receive such Security with a Common Share (other than as a result of the termination of all such Securities), a distribution of such Securities shall be deemed to have occurred, and the Conversion Price shall be adjusted as provided in this subsection (iii) (and such day shall be deemed to be “the date fixed for the determination of the shareholders entitled to receive such distribution” and “the record date” within the meaning of the two preceding sentences).

(iv)No adjustment in the Conversion Price shall be required unless such adjustment would require a cumulative increase or decrease of at least 1% in such price; provided, however, that any adjustments that by reason of this subsection (iv) are not required to be made shall be carried forward and taken into account in any subsequent adjustment until made; and provided, further, that any adjustment shall be required and made in accordance with the provisions of this subparagraph (7) (other than this subsection (iv)) not later than such time as may be required in order to preserve the tax-free nature of a distribution to the holders of Common Shares.  Notwithstanding any other provisions of this subparagraph (7), the Trust shall not be required to make any adjustment of the Conversion Price for the issuance of any Common Shares pursuant to any plan providing for the reinvestment of distributions or interest payable on securities of the Trust and the investment of additional optional amounts in Common Shares under such plan.  All calculations under this subparagraph (7) shall be made to the

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nearest cent with ($.005 being rounded upward) or to the nearest one-tenth of a share (with .05 of a share being rounded upward), as the case may be.  Anything in this subsection (d) to the contrary notwithstanding, the Trust shall be entitled, to the extent permitted by law, to make such reductions in the Conversion Price, in addition to those required by this subsection (d), as it in its discretion shall determine to be advisable in order that any share distributions, subdivision of shares, reclassification or combination of shares, distribution of rights, options or warrants to purchase shares or securities, or a distribution of other assets (other than cash distributions) hereafter made by the Trust to its shareholders shall not be taxable.

(e)If the Trust shall be a party to any transaction (including, without limitation, a merger, consolidation, statutory share exchange, self tender offer for all or substantially all of the Common Shares, sale of all or substantially all of the Trust’s assets or recapitalization of the Common Shares and excluding any transaction as to which subsection (d)(i) of this subparagraph (7) applied) (each of the foregoing being referred to herein as a “Transaction”), in each case as a result of which Common Shares shall be converted into the right to receive shares, stock, securities or other property (including cash or any combination thereof), each Series M-7 Preferred Share which is not converted into the right to receive shares, stock, securities or other property in connection with such Transaction shall thereafter be convertible into the kind and amount of shares, stock, securities and other property (including cash or any combination thereof) receivable upon the consummation of such Transaction by a holder of that number of Common Shares into which one Series M-7 Preferred Share was convertible immediately prior to such Transaction, assuming such holder of Common Shares (i) is not a Person with which the Trust consolidated or into which the Trust merged or which merged into the Trust or to which such sale or transfer was made, as the case may be (a “Constituent Person”), or an affiliate of a Constituent Person and (ii) failed to exercise his or her rights of the election, if any, as to the kind or amount of shares, stock, securities and other property (including cash) receivable upon such Transaction (provided that if the kind or amount of shares, stock, securities and other property (including cash) receivable upon such Transaction is not the same for each Common Share of the Trust held immediately prior to such Transaction by other than a Constituent Person or an affiliate thereof and in respect of which such rights of election shall not have been exercised (the “Non-Electing Share”), then for purposes of this paragraph (e) the kind and amount of shares, securities and other property (including cash) receivable upon such Transaction by each Non-Electing Share shall be deemed to be the kind and amount so receivable per share by a plurality of the Non-Electing Shares). The Trust shall not be a party to any Transaction unless the terms of such Transaction are consistent with the provisions of this subsection (e), and it shall not consent or agree to the occurrence of any Transaction until the Trust has entered into an agreement with the successor or purchasing entity, as the case may be, for the benefit of the holders of the Series M-7 Preferred

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Shares that will contain provisions enabling the holders of the Series M-7 Preferred Shares that remain outstanding after such Transaction to convert into the consideration received by holders of Common Shares at the Conversion Price in effect immediately prior to such Transaction.  The provisions of this subsection (e) shall similarly apply to successive Transactions.

(f)If:

(i)the Trust shall declare a distribution on the Common Shares (other than in cash out of the total equity applicable to Common Shares, including revaluation equity, less the amount of stated capital attributable to Common Shares, determined on the basis of the most recent annual and quarterly consolidated cost basis balance sheets of the Trust and its consolidated subsidiaries available at the time of the declaration of the distribution); or

(ii)the Trust shall authorize the granting to the holders of the Common Shares of rights or warrants to subscribe for or purchase any shares of any class or any other rights or warrants; or

(iii)there shall be any reclassifications of the Common Shares (other than an event to which subsection (d)(i) of this subparagraph (7) applied) or any consolidation or merger to which the Trust is a party and for which approval of any shareholders of the Trust is required, or a statutory share exchange involving the conversion or exchange of Common Shares into securities or other property, or a self tender offer by the Trust for all or substantially all of its outstanding Common Shares, or the sale or transfer of all or substantially all of the assets of the Trust as an entity and for which approval of any stockholder of the Trust is required; or

(iv)there shall occur the voluntary or involuntary liquidation, dissolution or winding up of the Trust, then the Trust shall cause to be filed with the Transfer Agent and shall cause to be mailed to the holders of the Series M-7 Preferred Shares at their addresses as shown on the share records of the Trust, as promptly as possible, but at least 15 days prior to the applicable date hereinafter specified, a notice stating (A) the date on which a record is to be taken for the purpose of such distribution or rights or warrants, or, if a record is not to be taken, the date as of which the holders of Common Shares of record to be entitled to such distribution or rights or warrants are to be determined or (B) the date on which such reclassification, consolidation, merger, statutory share exchange, sale, transfer, liquidation, dissolution or winding up is expected to become effective, and the date as of which it is expected that holders of Common Shares of record shall be entitled to exchange their Common Shares for securities or other property, if any, deliverable upon such reclassification, consolidation, merger, statutory share exchange, sale, transfer, liquidation, dissolution or winding up.  Failure

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to give or receive such notice or any defect therein shall not affect the legality or validity of the proceedings described in this subparagraph (7).

(g)Whenever the Conversion Price is adjusted as herein provided, the Trust shall promptly file with the Transfer Agent and the Depository an officer’s certificate setting forth the Conversion Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment, which certificate shall be conclusive evidence of the correctness of such adjustment absent manifest error.  Promptly after delivery of such certificate, the Trust shall prepare a notice of such adjustment of the Conversion Price setting forth the adjusted Conversion Price and the effective date such adjustment becomes effective and shall mail such notice of such adjustment of the Conversion Price to the holder of each Series M-7 Preferred Share at such holder’s last address as shown on the share records of the Trust.

(h)In any case in which subsection (d) of this subparagraph (7) provides that an adjustment shall become effective on the date next following the record date for an event, the Trust may defer until the occurrence of such event (A) issuing to the holder of any Series M-7 Preferred Shares converted after such record date and before the occurrence of such event the additional Common Shares issuable upon such conversion by reason of the adjustment required by such event over and above the Common Shares issuable upon such conversion before giving effect to such adjustment and (B) fractionalizing any Series M-7 Preferred Share and/or paying to such holder any amount of cash in lieu of any fraction pursuant to subsection (c) of this subparagraph (7).

(i)There shall be no adjustment of the Conversion Price in case of the issuance of any shares of beneficial interest of the Trust in a reorganization, acquisition or other similar transaction except as specifically set forth in this subparagraph (7).  If any action or Transaction would require adjustment of the Conversion Price pursuant to more than one subsection of this subparagraph (7), only one adjustment shall be made, and such adjustment shall be the amount of adjustment that has the highest absolute value.

(j)If the Trust shall take any action affecting the Common Shares, other than action described in this subparagraph (7), that in the opinion of the Board of Trustees would materially adversely affect the conversion rights of the holders of the Series M-7 Preferred Shares, the Conversion Price for the Series M-7 Preferred Shares may be adjusted, to the extent permitted by law, in such manner, if any, and at such time, as the Board of Trustees, in its sole discretion, may determine to be equitable in the circumstances.

(k)The Trust covenants that it will at all times reserve and keep available, free from preemptive rights, out of the aggregate of its authorized but issued Common Shares, for the purpose of affecting conversion of the Series M-7 Preferred Shares, the full number of Common Shares deliverable

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upon the conversion of all outstanding Series M-7 Preferred Shares not theretofore converted.  For purposes of this subsection (k), the number of Common Shares that shall be deliverable upon the conversion of all outstanding Series M-7 Preferred Shares shall be computed as if at the time of computation all such outstanding shares were held by a single holder.

The Trust covenants that any Common Shares issued upon conversion of the Series M-7 Preferred Shares shall be validly issued, fully paid and non-assessable.  Before taking any action that would cause an adjustment reducing the Conversion Price below the then-par value of the Common Shares deliverable upon conversion of  the Series M-7 Preferred Shares, the Trust will take any action that, in the opinion of its counsel, may be necessary in order that the Trust may validly and legally issue fully paid and nonassessable Common Shares at such adjusted Conversion Price.

The Trust shall endeavor to list the Common Shares required to be delivered upon conversion of the Series M-7 Preferred Shares, prior to such delivery, upon each national securities exchange, if any, upon which the outstanding Common Shares are listed at the time of such delivery.

Prior to the delivery of any securities that the Trust shall be obligated to deliver upon conversion of the Series M-7 Preferred Shares, the Trust shall endeavor to comply with all federal and state laws and regulations thereunder requiring the registration of such securities with, or any approval of or consent to the delivery thereof by any governmental authority.

(l)The Trust will pay any and all documentary stamp or similar issue or transfer taxes payable in respect of the issue or delivery of Common Shares or other securities or property on conversion of the Series M-7 Preferred Shares pursuant hereto; provided, however, that the Trust shall not be required to pay any tax that may be payable in respect of any transfer involved in the issue or delivery of Common Shares or other securities or property in a name other than that of title holder of the Series M-7 Preferred Shares to be converted, and no such issue or delivery shall be made unless and until the person requesting such issue or delivery has paid to the Trust the amount of any such tax or established, to the reasonable satisfaction of the Trust, that such tax has been paid.

(m)In addition to the foregoing adjustments, the Company will be permitted to make such reductions in the Conversion Price as it considers to be advisable in order that any event treated for federal income tax purposes as a dividend of stock or stock rights will not be taxable to the holders of the Common Shares.

C.Restrictions on Transfer.  The Series M-7 Preferred Shares shall be subject to the restrictions on transfer and ownership of Shares in Article VII of the Declaration of Trust, as supplemented below.

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(1)Certain Definitions.

For purposes of the Series M-7 Preferred Shares the following terms shall have the following meanings:

“Closing Date of the Series M-7 Preferred Shares Offering” shall mean the time and date of payment for and delivery of Series M-7 Preferred Shares issued pursuant to the conversion of Series J Preference Units.

“Special Triggering Event” shall mean either (i) the redemption or purchase by the Trust of all or a portion of the outstanding shares of beneficial interest in the Trust, or (ii) a change in the value of the Series M-7 Preferred Shares relative to any other class of beneficial interest in the Trust.

(2)Special Triggering Event.  If during the period commencing on the Closing Date of the Series M-7 Preferred Shares Offering and prior to the Restriction Termination Date, a Special Triggering Event (if effective) or other event or occurrence (if effective) would result in any violation of section 7.2(a) of the Trust’s Declaration of Trust, then (i) the number of Series M-7 Preferred Shares (rounded up to the nearest whole share) that would (but for this section) cause any Person to Beneficially Own either Series M-7 Preferred Shares, or to Beneficially Own Series M-7 Preferred Shares and any other shares of beneficial interest in the Trust, in violation of section 7.2(a) shall be treated as provided in Article VII.  Such treatment shall be effective as of the close of business on the Business Day prior to the date of the Special Triggering Event or other event or occurrence.

(3)Ambiguity.  In the case of an ambiguity in the application of any of the provisions of this section, including any definition contained in paragraph (1), the Board of Trustees shall have the power to determine the application of this section with respect to any situation based on the facts known to it (subject, however, to the provisions of Section 7.2(a)).

(4)Exclusion of Other Rights.

The Series M-7 Preferred Shares shall not have any voting powers, preferences and relative, participating, optional or other special rights, other than those specifically set forth in these terms of the Series M-7 Preferred Shares (as such terms may be amended from time to time) and in the Declaration of Trust.  The Series M-7 Preferred Shares shall have no preemptive or subscription rights.

(5)Headings of Subdivisions.

The headings of the various subdivisions hereof are for convenience of reference only and shall not affect the interpretation of any of the provisions hereof.

(6)Severability of Provisions.

If any voting powers, preferences and relative, participating, optional and other special rights of the Series M-7 Preferred Shares and qualifications, limitations and restrictions

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thereof set forth in these terms of the Series M-7 Preferred Shares (as such terms may be amended from time to time) is invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, all other voting powers, preferences and relative, participating, optional and other special rights of Series M-7 Preferred Shares and qualifications, limitations and restrictions thereof set forth in these terms of the Series M-7 Preferred Shares (as so amended), which can be given effect without the invalid, unlawful or unenforceable voting powers, preferences, and relative, participating, optional or other special rights of Series M-7 Preferred Shares and qualifications, limitations and restrictions thereof herein set forth, shall nevertheless, remain in full force and effect and no preferences or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of the Series M-7 Preferred Shares herein set forth shall be deemed dependent upon any other such voting powers, preferences and relative, participating, optional or other special rights of Series M-7 Preferred Shares and qualifications, limitations and restrictions thereof unless so expressed herein.

SECTION 13.17.Series N Preferred Shares.

A.Certain Definitions.

Unless the context otherwise requires, the terms defined in this paragraph A shall have, for all purposes of the Series N Articles Supplementary, the meanings herein specified (with terms defined in the singular having comparable meanings when used in the plural).

“Business Day” shall mean any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in New York City are authorized or required by law, regulation or executive order to close.

“Closing Date of the Series N Preferred Shares Offering” shall have the meaning set forth in subparagraph (1) of paragraph C below.

“Code” shall mean the Internal Revenue Code of 1986, as amended.

“Common Shares” shall mean the common shares of beneficial interest, $.01 par value per share, of the Trust.

“Declaration of Trust” shall have the meaning set forth in Article First of the Series N Articles Supplementary.

“Distribution Period” shall have the meaning set forth in subparagraph (4) of paragraph B below.

“Event” shall have the meaning set forth in subparagraph (7)(c) of paragraph B below.

“Junior Shares” shall have the meaning set forth in subparagraph (3) of paragraph B below.

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“Parity Shares” shall have the meaning set forth in subparagraph (3) of paragraph B below.

“Person” shall mean an individual, corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code, joint stock company or other entity, and also includes a group as that term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended; but does not include an underwriter which participates in a public offering of the Series N Preferred Shares provided that the ownership of Series N Preferred Shares by such Underwriter would not result in the Trust being “closely held” within the meaning of Section 856(h) of the Code, or would otherwise result in the Trust failing to qualify as a REIT.

“Preferred Shares” shall mean preferred shares of beneficial interest of the Trust designated as or otherwise on a parity with the Series N Preferred Shares as to distributions and rights upon voluntary or involuntary dissolution, liquidation or winding up of the Trust as may be issued and outstanding from time to time, including Series B Preferred Shares, Series C Preferred Shares, Series D Preferred Shares, Series E Preferred Shares, Series G Preferred Shares, Series H Preferred Shares, Series K Preferred Shares, Series L Preferred Shares, Series M Preferred Shares, Series M-1 Preferred Shares, Series M-2 Preferred Shares, Series M-3 Preferred Shares, Series M-4 Preferred Shares, Series M-5 Preferred Shares, Series M-6 Preferred Shares, and Series M-7 Preferred Shares and any other shares so designated.

“Quarterly Distribution Date” shall have the meaning set forth in subparagraph (4) of paragraph B below.

“Record Date” shall have the meaning set forth in subparagraph (4) of paragraph B below.

“REIT” shall mean a real estate investment trust under Section 856 of the Code.

“Series N Preferred Shares” shall have the meaning set forth in subparagraph (1) of paragraph B below.

“Series N Redemption Date” shall have the meaning set forth in subparagraph (6)(a) of paragraph B below.

“Series N Redemption Price” shall have the meaning set forth in subparagraph (6)(a) of paragraph B below.

“Special Triggering Event” shall have the meaning set forth in subparagraph (1) of paragraph C below.

“Trust” shall have the meaning set forth in Article First of the Series N Articles Supplementary.

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All other capitalized terms used but not defined shall have the meanings ascribed to them in the Declaration of Trust.

B.Series N Preferred Shares.

(1)Number.  A series of Preferred Shares, consisting of 600,000 Preferred Shares designated as 6.48% Series N Cumulative Redeemable Preferred Shares of Beneficial Interest, $.01 par value per share (liquidation preference $250.00 per share) (the “Series N Preferred Shares”) is hereby established.

(2)Preferred Shares Issued Without Certificate.  Some or all of the Series N Preferred Shares may be issued without certificates at the discretion of the officers of the Trust which may act through the transfer agent with respect to the Series N Preferred Shares.

(3)Ranking.  In respect of rights to receive distributions and to participate in distributions or payments in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Trust, the Series N Preferred Shares shall rank (i) senior to the Common Shares and any other class or series of shares of beneficial interest of the Trust ranking, as to distributions and upon liquidation, junior (collectively, the “Junior Shares”) to the Preferred Shares, (ii) pari passu with any other Preferred Shares of the Trust and any other class or series of shares of beneficial interest of the Trust ranking, as to distributions and upon liquidation, pari passu (collectively, the “Parity Shares”) with the Preferred Shares, and (iii) junior to any class or series of shares of beneficial interest of the Trust ranking, as to distributions and upon liquidation, senior to the Preferred Shares (when and if issued).

(4)Distributions.  (a) The holders of the then outstanding Series N Preferred Shares shall be entitled to receive, when and as authorized by the Board of Trustees and declared by the Trust out of any funds legally available therefor, cumulative distributions at the rate of $16.20 per share per year, payable in equal amounts of $4.05 per share quarterly in arrears in cash on the fifteenth day, or if not a Business Day, the next succeeding Business Day, of January, April, July and October in each year (each such day being hereinafter called a “Quarterly Distribution Date” and each period ending on a Quarterly Distribution Date being hereinafter called a “Distribution Period”), beginning on October 15, 2003, to shareholders of record at the close of business on the first day of the calendar month in which such Quarterly Distribution Date falls or such other date as shall be fixed by the Board of Trustees at the time of declaration of the distribution (the “Record Date”), which shall not be less than 10 nor more than 45 days preceding the Quarterly Distribution Date.  The amount of any distribution payable for the initial Distribution Period and for any other Distribution Period shorter than or longer than a Distribution Period shall be prorated and computed on the basis of a 360-day year of twelve 30-day months.  Distributions on each Series N Preferred Share shall accrue and be cumulative from the date of original issue thereof, whether or not (i) distributions on such shares are earned or declared or (ii) on any Quarterly Distribution Date there shall be funds legally available for the payment of distributions.  Distributions paid on the Series N Preferred Shares in an amount less than the total amount of such distributions at the time accrued and payable on such shares shall be allocated pro rata on a per share basis among all such shares at the time outstanding.  Accrued but unpaid distributions on the Series N Preferred Shares will not bear interest and holders of the Series N Preferred Shares will not be entitled to any distributions in excess of full cumulative distributions as described herein.

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Any distribution payment made on the Series N Preferred Shares shall first be credited against the earliest accrued but unpaid distribution due with respect to such shares which remains payable.

(b)The amount of any distributions accrued on any Series N Preferred Shares at any Quarterly Distribution Date shall be the amount of any unpaid distributions accumulated thereon, to and including such Quarterly Distribution Date, whether or not earned or declared, and the amount of distributions accrued on any Series N Preferred Shares at any date other than a Quarterly Distribution Date shall be equal to the sum of the amount of any unpaid distributions accumulated thereon, to and including the last preceding Quarterly Distribution Date, whether or not earned or declared, plus an amount calculated on the basis of the annual distribution rate of $16.20 for the period after such last preceding Quarterly Distribution Date to and including the date as of which the calculation is made based on a 360-day year of twelve 30-day months.

(c)In determining whether a distribution (other than upon voluntary or involuntary liquidation), by dividend, redemption or other acquisition of shares of beneficial interest of the Trust or otherwise, is permitted under Maryland law, amounts that would be needed, if the Trust were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of holders of Series N Preferred Shares will not be added to the Trust’s total liabilities.

(d)Except as provided in the Series N Articles Supplementary, the Series N Preferred Shares shall not be entitled to participate in the earnings or assets of the Trust.

(e)If, for any taxable year, the Trust elects to designate as “capital gain dividends” (as defined in Section 857 of the Code), any portion (the “Capital Gains Amount”) of the total dividends (within the meaning of the Code) paid (or treated as paid for federal income tax purposes) in such taxable year to holders of all classes of capital stock (the “Total Dividends”), then the portion of the Capital Gains Amount that shall be allocable to holders of Series N Preferred Shares shall be the Capital Gains Amount multiplied by a fraction, the numerator of which will be the total dividends paid (or treated as paid for federal income tax purposes) to the holders of the Series N preferred sharesfor the taxable year and the denominator of which shall be the Total Dividends.

(f)So long as any Series N Preferred Shares are outstanding, no distributions, except as described in the immediately following sentence, shall be declared or paid or set apart for payment on any class or series of Parity Shares for any period unless full cumulative distributions have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for such payment on the Series N Preferred Shares for all Distribution Periods terminating on or prior to the distribution payment date for such class or series of Parity Shares.  When distributions are not paid in full or a sum sufficient for such payment is not set apart, as aforesaid, all distributions declared upon Series N Preferred Shares and all distributions declared upon any other class or series of Parity Shares shall be declared ratably in proportion to the respective amounts of distributions accumulated and unpaid on the Series N Preferred Shares and accumulated and unpaid on such Parity Shares.

(g)No distributions on Series N Preferred Shares shall be authorized by the Board of Trustees or be paid or set apart for payment by the Trust at such time as the terms and provisions of any agreement of the Trust, including any agreement relating to its indebtedness, prohibits such

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authorization, payment or setting apart for payment or provides that such authorization, payment or setting apart for payment would constitute a breach thereof or a default thereunder, or if such authorization or payment shall be restricted or prohibited by law.

(5)Liquidation Rights.

(a)Upon the voluntary or involuntary dissolution, liquidation or winding up of the Trust, the holders of the Series N Preferred Shares then outstanding shall be entitled to receive and to be paid out of the assets of the Trust available for distribution to its shareholders, before any payment or distribution shall be made on any Junior Shares, the amount of $250.00 per Series N Preferred Share, plus accrued and unpaid distributions thereon.

(b)After the payment to the holders of the Series N Preferred Shares of the full preferential amounts provided for in this paragraph B, the holders of the Series N Preferred Shares as such shall have no right or claim to any of the remaining assets of the Trust.

(c)If, upon any voluntary or involuntary dissolution, liquidation, or winding up of the Trust, the amounts payable with respect to the preference value of the Series N Preferred Shares and any other shares of beneficial interest of the Trust ranking as to any such distribution on a parity with the Series N Preferred Shares are not paid in full, the holders of the Series N Preferred Shares and of such other shares will share ratably in any such distribution of assets of the Trust in proportion to the full respective preference amounts to which they are entitled.

(d)Neither the sale, lease, transfer or conveyance of all or substantially all the property or business of the Trust, nor the merger or consolidation of the Trust into or with any other entity or the merger or consolidation of any other entity into or with the Trust, shall be deemed to be a dissolution, liquidation or winding up, voluntary or involuntary, for the purposes of this paragraph B.

(6)Redemption.

(a)Optional Redemption.  The Series N Preferred Shares shall not be redeemable by the Trust prior to June 19, 2008.On and after June 19, 2008 the Trust may, at its option, redeem at any time all or, from time to time, part of the Series N Preferred Shares at a price per share (the “Series N Redemption Price”), payable in cash, of $250.00 per Series N Preferred Share, together with all accrued and unpaid distributions to and including the date fixed for redemption (the “Series N Redemption Date”), without interest, to the extent the Trust has funds legally available for redemption.

(b)Procedures for Redemption.

(i)Notice of any redemption will be mailed by the Trust, postage prepaid, or sent via overnight delivery service, not less than 30 days nor more than 60 days prior to the Series N Redemption Date, addressed to the holders of record of the Series N Preferred Shares to be redeemed at their addresses as they appear on the share transfer records of the Trust.  No failure to give such notice or any defect therein or in the mailing thereof shall affect the validity of the proceedings for the redemption of any Series N Preferred Shares except as to the holder to

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whom the Trust has failed to give notice or except as to the holder to whom notice was defective.  In addition to any information required by law or by the applicable rules of any exchange upon which Series N Preferred Shares may be listed or admitted to trading, such notice shall state: (A) the Series N Redemption Date; (B) the Series N Redemption Price; (C) the number of Series N Preferred Shares to be redeemed; (D) the place or places where certificates for such shares are to be surrendered for payment of the Series N Redemption Price; and (E) that distributions on the shares to be redeemed will cease to accumulate on the Series N Redemption Date.

(ii)If notice has been mailed in accordance with subparagraph (5)(b)(i) above and provided that on or before the Series N Redemption Date specified in such notice all funds necessary for such redemption shall have been irrevocably set aside by the Trust, separate and apart from its other funds for the pro rata benefit of the holders of the Series N Preferred Shares so called for redemption, so as to be, and to continue to be available therefor, then, from and after the Series N Redemption Date (unless the Trust defaults in the payment of the Series N Redemption Price), distributions on the Series N Preferred Shares so called for redemption shall cease to accumulate, and said shares shall no longer be deemed to be outstanding and shall not have the status of Series N Preferred Shares and all rights of the holders thereof as shareholders of the Trust (except the right to receive the Series N Redemption Price) shall cease.  Upon surrender, in accordance with said notice, of the certificates for any certificated Series N Preferred Shares so redeemed (properly endorsed or assigned for transfer, if the Trust shall so require and the notice shall so state), such Series N Preferred Shares shall be redeemed by the Trust at the Series N Redemption Price.  In case fewer than all the Series N Preferred Shares evidenced by any such certificate are redeemed, a new certificate or certificates shall be issued evidencing the unredeemed Series N Preferred Shares without cost to the holder thereof.

(iii)Any funds deposited with a bank or trust company for the purpose of redeeming Series N Preferred Shares shall be irrevocable except that:

(A)the Trust shall be entitled to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and the holders of any shares redeemed shall have no claim to such interest or other earnings; and

(B)any balance of monies so deposited by the Trust and unclaimed by the holders of the Series N Preferred Shares entitled thereto at the expiration of two years from the applicable Series N Redemption Date shall be repaid, together with any interest or other earnings earned thereon, to the Trust, subject to escheat laws, and after any such repayment, the holders of the shares entitled to the funds so repaid to the Trust shall look only to the Trust for payment without interest or other earnings.

(iv)No Series N Preferred Shares may be redeemed except with funds legally available for the payment of the Series N Redemption Price.

(v)Unless full accumulated distributions on all Series N Preferred Shares shall have been or contemporaneously are declared and paid or declared and a

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sum sufficient for the payment thereof set apart for payment for all past Distribution Periods and the then current Distribution Period, no Series N Preferred Shares shall be redeemed (unless all outstanding Series N Preferred Shares are simultaneously redeemed) or purchased or otherwise acquired directly or indirectly (except by conversion into or exchange for shares of beneficial interest of the Trust ranking junior to the Series N Preferred Shares as to distributions and upon liquidation); provided, however, that the foregoing shall not prevent the redemption of Series N Preferred Shares pursuant to Article VII of the Declaration of Trust or the purchase or acquisition of Series N Preferred Shares pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding Series N Preferred Shares.

(vi)If the Series N Redemption Date is after a Record Date and before the related Quarterly Distribution Date, the distribution payable on such Quarterly Distribution Date shall be paid on the Series N Redemption Date to the holder in whose name the Series N Preferred Shares to be redeemed are registered at the close of business on such Record Date notwithstanding the redemption thereof between such Record Date and the related Quarterly Distribution Date or the Trust’s default in the payment of the distribution due.

(vii)In case of redemption of less than all Series N Preferred Shares at the time outstanding, the Series N Preferred Shares to be redeemed shall be selected pro rata from the holders of record of such shares in proportion to the number of Series N Preferred Shares held by such holders (with adjustments to avoid redemption of fractional shares) or by any other equitable method determined by the Trust. If fewer than all the Series N Preferred Shares represented by any certificate are redeemed, then new certificates representing the unredeemed shares shall be issued without charges to the holder thereof.

(7)Voting Rights.  Except as required by law and as provided in the Series N Articles Supplementary, the holders of the Series N Preferred Shares shall not be entitled to vote at any meeting of the shareholders for election of trustees or for any other purposes or otherwise to participate in any action taken by the Trust or the shareholders thereof, or to receive notice (except for such notice as required by law) of any meeting of shareholders.

(a)In any matter in which the Series N Preferred Shares are entitled to vote (as expressly provided herein), including any action by written consent, each Series N Preferred Share shall be entitled to 10 votes, each of which 10 votes may be directed separately by the holder thereof (or by any proxy or proxies of such holder).  With respect to each Series N Preferred Share, the holder thereof may designate up to 10 proxies, with each such proxy having the right to vote a whole number of votes (totaling 10 votes per Series N Preferred Share).

(b)Whenever distributions on any Series N Preferred Shares shall be in arrears for six or more quarterly periods, the holders of such Series N Preferred Shares, voting separately as a class with all other series of Preferred Shares upon which like voting rights have been conferred and are exercisable, will be entitled to vote for the election of two additional Trustees of the Trust at a special meeting called by the holders of record of at least ten percent (10%) of any series of Preferred Shares so in arrears (or such other number of holders as may be specifically provided for in the terms establishing the voting powers of such series and unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the shareholders) or at the next annual meeting of shareholders, and at each subsequent annual meeting

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until all distributions accumulated on such Series N Preferred Shares for the past distribution periods and the then current distribution period shall have been fully paid or declared and a sum sufficient for the payment thereof set aside for payment.  In such case, the entire Board of Trustees of the Trust will be increased by two Trustees.

(c)So long as any Series N Preferred Shares remain outstanding, the Trust will not, without the affirmative vote or consent of the holders of at least two-thirds of the Series N Preferred Shares outstanding at the time, given in person or by proxy, either in writing or at a meeting (such series voting separately as a class), (i) authorize or create, or increase the authorized or issued amount of, any class or series of shares of beneficial interest ranking senior to the Series N Preferred Shares with respect to the payment of distributions or to the distribution of assets upon liquidation, dissolution or winding up of the Trust or reclassify any authorized shares of beneficial interest of the Trust into such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or (ii) amend, alter or repeal the provisions of the Declaration of Trust or the Series N Articles Supplementary, as such Articles Supplementary may be amended from time to time, whether by merger, consolidation or otherwise (an “Event”), so as to materially and adversely affect any right, preference, privilege or voting power of the Series N Preferred Shares or the holders thereof; provided, however, with respect to the occurrence of any of the Events set forth in (ii) above, so long as the Series N Preferred Shares remain outstanding with the terms thereof materially unchanged, taking into account that upon the occurrence of an Event, the Trust may not be the surviving entity or the Series N Preferred Shares that remain outstanding may bear a new title, designation and/or be issued by a different issuer, the occurrence of any such Event shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting power of holders of Series N Preferred Shares and provided further that (x) any increase in the amount of the authorized Preferred Shares or the creation or issuance of any other Preferred Shares, or (y) any increase in the amount of authorized Series N Preferred Shares or any other Preferred Shares, in each case ranking on a parity with or junior to the Series N Preferred Shares with respect to payment of distributions or the distribution of assets upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting powers.

The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding Series N Preferred Shares shall have been redeemed or called for redemption and sufficient funds shall have been deposited in trust to effect such redemption.

(8)Conversion.  The Series N Preferred Shares are not convertible into or exchangeable for any other property or securities of the Trust, except into Excess Shares in connection with maintaining the ability of the Trust to qualify as a REIT.

(9)Status of Redeemed or Reacquired Shares.  All Series N Preferred Shares that have been issued and redeemed or reacquired in any manner by the Trust shall become unclassified Preferred Shares available for subsequent reclassification and issuance.

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C.Restrictions on Transfer.

The Series N Preferred Shares shall be subject to the restrictions on transfer and ownership of Shares in Article VII of the Declaration of Trust, as supplemented below.

(1)Certain Definitions.  For purposes of the Series N Preferred Shares, any capitalized terms used but not defined in this paragraph C shall have the meanings ascribed to them in the Declaration of Trust and, furthermore, the following terms shall have the following meanings:

“Closing Date of the Series N Preferred Shares Offering” shall mean the time and date of payment for and delivery of Series N Preferred Shares (or depositary shares relating thereto) issued pursuant to the Trust’s effective registration statement relating to such Series N Preferred Shares (or depositary shares relating thereto) filed under the Securities Act of 1933, as amended.

“Special Triggering Event” shall mean either (i) the redemption or purchase by the Trust of all or a portion of the outstanding shares of beneficial interest in the Trust, or (ii) a change in the value of the Series N Preferred Shares relative to any other class of beneficial interest in the Trust.

(2)Special Triggering Event.  If during the period commencing on the Closing Date of the Series N Preferred Shares Offering and prior to the Restriction Termination Date, a Special Triggering Event (if effective) or other event or occurrence (if effective) would result in any violation of section 7.2(a) of the Declaration of Trust (or would result in the Trust being “closely held” within the meaning of Section 856(h) of the Code or would otherwise cause the Trust to fail to qualify as a REIT), then (i) the number of Series N Preferred Shares (rounded up to the nearest whole share) that would (but for this section) cause any Person to Beneficially Own either Series N Preferred Shares, or to Beneficially Own Series N Preferred Shares and any other shares of beneficial interest in the Trust, in violation of section 7.2(a) of the Declaration of Trust (or would result in the Trust being “closely held” or otherwise fail to qualify as a REIT) shall constitute “Excess Shares” and shall be treated as provided in Article VII of the Declaration of Trust.  Such designation and treatment shall be effective as of the close of business on the Business Day prior to the date of the Special Triggering Event or other event or occurrence.

(3)Ambiguity.  In the case of an ambiguity in the application of any of the provisions of this section, including any definition contained in paragraph (1), the Board of Trustees shall have the power to determine the application of this section with respect to any situation based on the facts known to it (subject, however, to the provisions of Section 7.2(a) of the Declaration of Trust).

(4)Exclusion of Other Rights.

The Series N Preferred Shares shall not have any voting powers, preferences and relative, participating, optional or other special rights, other than those specifically set forth in the Series N Articles Supplementary (as such Articles Supplementary may be amended from time to time) and in the Declaration of Trust.  The Series N Preferred Shares shall have no preemptive or subscription rights.

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(5)Headings of Subdivisions.

The headings of the various subdivisions hereof are for convenience of reference only and shall not affect the interpretation of any of the provisions hereof.

(6)Severability of Provisions.

If any voting powers, preferences and relative, participating, optional and other special rights of the Series N Preferred Shares and qualifications, limitations and restrictions thereof set forth in the Series N Articles Supplementary (as such Articles Supplementary may be amended from time to time) is invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, all other voting powers, preferences and relative, participating, optional and other special rights of Series N Preferred Shares and qualifications, limitations and restrictions thereof set forth in the Series N Articles Supplementary (as so amended) which can be given effect without the invalid, unlawful or unenforceable voting powers, preferences and relative, participating, optional or other special rights of Series N Preferred Shares and qualifications, limitations and restrictions thereof herein set forth shall, nevertheless, remain in full force and effect and no preferences or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of the Series N Preferred Shares herein set forth shall be deemed dependent upon any other such voting powers, preferences and relative, participating, optional or other special right of Series N Preferred Shares and qualifications, limitations and restrictions thereof unless so expressed herein.

THIRD:The name and address of the Trust’s current resident agent is set forth in Section 1.2 of the foregoing restatement of the charter.

FOURTH:The number of trustees of the Trust is eleven; the names of those currently in office are as follows:

Samuel Zell

Bruce W. Duncan

John W. Alexander

Charles L. Atwood

Stephen O. Evans

James D. Harper

Boone A. Knox

Desiree G. Rogers

Sheli Z. Rosenberg

Gerald A. Spector

B. Joseph White

FIFTH:The foregoing restatement of the Declaration of Trust has been approved by a majority of the Board of Trustees.

SIXTH:The Declaration of Trust is not amended by these Articles of Restatement.

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The undersigned Chief Executive Officer and President acknowledges these Articles of Restatement to be the trust act of the Trust and as to all matters or facts required to be verified under oath, the undersigned Chief Executive Officer and President acknowledges that to the best of his knowledge, information and belief, these matters and facts are true in all material respects and that this statement is made under the penalties for perjury.

IN WITNESS WHEREOF, the Trust has caused these Articles to be signed in its name and on its behalf by its Chief Executive Officer and President and attested to by its Secretary on this 9^th day of December, 2004.

ATTEST:	EQUITY RESIDENTIAL
/s/ Bruce C. Strohm	By:	/s/ Bruce W. Duncan
Bruce C. Strohm		Bruce W. Duncan
Secretary		Chief Executive Officer and President

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EX-10.16

Exhibit 10.16

FIRST AMENDMENT TO EQUITY RESIDENTIAL 2002 SHARE INCENTIVE PLAN

THIS FIRST AMENDMENT (“First Amendment”) TO EQUITY RESIDENTIAL 2002 SHARE INCENTIVE PLAN  (“Plan”) is made as of the 7^th day of February 2003.

Recitals:

1.The Board of Trustees of Equity Residential (the “Company”) has determined to adopt an amendment to the Plan, which does not require shareholder approval as permitted under Section 16 (c).

2.Terms used in this First Amendment which are defined in the Plan have the meanings given them in the Plan.

1.AMENDMENTS.  Section 3 (b) of the Plan is hereby deleted and the following Section 3 (b) is substituted therefore:

(b)Board of Trustees. Each member of the Board of Trustees will receive an annual award of Share Awards and Options equal to $50,000 in value on the same day as the annual grant of Share Awards and Options to the Company’s executive officers.  The annual $50,000 award will be allocated between Options (valued by using the same valuation criteria utilized by the Committee in its employee option grants made as of the same date) and Share Awards (valued at the closing price of the Company’s common shares on the date of grant), in the same ratio as approved by the Committee for the annual long term incentive awards to the Company’s executive officers.  The Share Award will vest in full on the third anniversary of the Grant Date.  The Options will vest in equal installments six months, twelve months and twenty-four months from the Grant Date.

2.PLAN IN FULL FORCE AND EFFECT.  After giving effect to this First Amendment, the Plan remains in full force and effect.

EX-10.17

Exhibit 10.17

SECOND AMENDMENT TO EQUITY RESIDENTIAL 2002 SHARE INCENTIVE PLAN

THIS SECOND AMENDMENT (the “Second Amendment”) to EQUITY RESIDENTIAL 2002 SHARE INCENTIVE PLAN (“Plan”) is executed as of the 10^th day of June 2003.

RECITALS

WHEREAS, the Board of Trustees of Equity Residential (the “Company”) adopted the 2002 Share Incentive Plan (“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.

WHEREAS, the Board of Trustees have adopted a resolution to amend the terms of all outstanding Trustee Share Awards and Options as well as the annual grants of Trustee Share Awards and Options to be made after the date of this Second Amendment.

WHEREAS, each member of the Board of Trustees to be affected by this Second Amendment has agreed to the terms hereof.

WHEREAS, the Company desires to further amend the Plan pursuant to this Second Amendment.

NOW THEREFORE, the Plan is further amended as follows:

AMENDMENTS

1.Section 3 (b) of the Plan is hereby deleted in its entirely and the following Section 3 (b) is substituted therefor:

(b)Board of Trustees.  Each member of the Board of Trustees (excluding the Chairman of the Board and the employee trustees)  will receive an annual award (relating to the Trustee’s term as Trustee for the one-year period following the subsequent shareholders’ meeting at which trustees are elected) of Share Awards and Options equal to $50,000 in value on the same day as the annual grant of Share Awards and Options to the Company’s executive officers.  The annual $50,000 award will be allocated between Options (valued by using the same valuation criteria utilized by the Committee in its employee option grants made as of the same date) and Share Awards (valued at the closing price of the Company’s common shares on the date of grant), in the same ratio as approved by the Committee for the annual long term incentive awards to the Company’s executive officers.  The Share Award will vest in full on the third anniversary of the Grant Date.  The Options will vest in equal installments six months, twelve months and twenty-four months from the Grant Date.  The annual award of Share Awards and Options is also subject to the Trustee receiving the grant being re-elected as a Trustee at

the subsequent shareholders’ meeting.  If an individual first becomes a Trustee following the annual grant, the Trustee will receive a grant of Share Awards and Options in the same ratio as the prior annual Trustee’s grant equal to $50,000 multiplied by a fraction, the numerator of which is the number of days left in said one year Trustee term from the date of such Trustee’s election or appointment to the Board of Trustees, until the anniversary of the immediately preceding shareholders’ meeting at which trustees were re-elected, and the denominator of which is 365.  Trustees may, in addition to Options and Share Awards awarded under this paragraph, also receive grants of Options and Share Awards under paragraph 3(a).

2.Section 5 (a) (iii) (C) is hereby deleted in its entirety and the following 5 (a) (iii) (C) is substituted therefor, to be effective as of February 21, 2002:

with respect to a Grantee who is a member of the Board (excluding employee trustees and the Company’s Chairman of the Board) in connection with his or her retirement at or after age 70, the Board’s decision not to renominate him or her for re-election to the Board at any shareholders’ meeting at which Trustees are elected, or the failure to be re-elected to the Board at any such shareholders’ meeting, or the Trustee’s resignation from the Board by reason of either:  (i) a material change in the Trustee’s employment or job responsibilities; or (ii) the Trustee’s disability.

3.Section 6 (e) (iii) is hereby deleted in its entirety and the following 6 (e) (iii) is substituted therefor, to be effective as of February 21, 2002:

with respect to a Grantee who is a member of the Board (excluding employee trustees and the Company’s Chairman of the Board) in connection with his or her retirement at or after age 70,  the Board’s decision not to renominate him or her for re-election to the Board at any shareholders’ meeting at which Trustees are elected, or the failure to be re-elected to the Board at any such shareholders’ meeting, or the Trustee’s resignation from the Board by reason of either:  (i) a material change in the Trustee’s employment or job responsibilities; or (ii) the Trustee’s disability, in which case it shall be exercisable until its Expiration Date.

4.PLAN IN FULL FORCE AND EFFECT.   After giving effect to this Second Amendment, the Plan remains in full force and effect.

EX-10.18

Exhibit 10.18

FORM OF 2005

EQUITY RESIDENTIAL

PERFORMANCE BASED UNIT AWARD GRANT AGREEMENT

ARTICLE 1

ESTABLISHMENT

1.1.          Pursuant to the terms of this Grant Agreement(1) (“Grant”), effective as of January 1, 2005 (“Grant Date”), the undersigned Participant, intending to be legally bound, hereby accepts a Performance Unit Award (“Award”) of                  Units (as defined below) from Equity Residential (“Trust”) in accordance with the terms of the Trust’s 2002 Share Incentive Plan (the “Plan”). Notwithstanding the foregoing, the actual number of Units provided under the Award shall be determined under Article 3. The purpose of the Award is to promote the overall financial objectives of the Trust and its shareholders by linking the financial interests of the Participant to the achievement of long-term growth in shareholder equity in the Trust and by enabling the Trust to retain the services of those individuals who are instrumental in achieving this growth.

ARTICLE 2

SHARES SUBJECT TO GRANT

2.1.          Description of Units.  For purposes of this Grant, a “Unit” shall consist of the measurement of the number of common shares of beneficial interest (“Shares”) that will be issued by the Trust to the Participant upon the satisfaction of the criteria in this Grant.  Except as otherwise specifically provided herein, the Participant shall have no property or ownership interest with respect to a Unit and, accordingly, a Unit may not be assigned or transferred to any person other than to the estate of a Participant upon his or her death.

2.2.          Restrictions on Shares.  Shares issued in conjunction with this Award shall be subject to the terms and conditions specified herein and to such other terms, conditions and restrictions as may be required under the terms of the Plan and applicable law.  The Trust shall not be required to issue or deliver any certificates for Shares or Units, cash or other property prior to the satisfaction of the performance criteria associated with the Award and any applicable income tax withholding obligation. The Trust may cause any certificate for any Shares to be delivered to be properly marked with a legend or other notation reflecting the limitations on transfer of such Shares as provided in this Grant, applicable securities law or as the Committee may otherwise require. The Committee may require the Participant to make such representations and furnish such information as it may consider appropriate in connection with the issuance or delivery of the Shares in

(1)For purposes of this Grant, any capitalized terms which are undefined in this Grant shall have the meaning given to such term under the provisions of the Equity Residential 2002 Share Incentive Plan, of which this Grant shall be considered a part.

compliance with applicable law or otherwise. Fractional Shares shall not be delivered, but shall be rounded to the next highest whole number of Shares with appropriate payment for such fractional Shares as shall reasonably be determined by the Committee.

2.3.          Shareholder Rights.  No person shall have any rights of a shareholder as to Shares or Units subject to a Award until, after proper conversion of the Units relating to the Award or other action required, such Shares shall have been recorded on the Trust’s official shareholder records as having been issued or transferred. Upon conversion of the Units relating to the Award (or any portion thereof) and the satisfaction of the requirements for issuance of the Shares to the Participant, the Trust will have ten (10) days in which to issue the Shares, and the Participant will not be treated as a shareholder for any purpose whatsoever prior to such issuance. No adjustment shall be made for cash dividends or other rights for which the record date is prior to the date such Shares are recorded as issued or transferred in the Trust’s official shareholder records, except as provided herein or any subsequent written agreement.

ARTICLE 3

AWARDS

3.1.          Value of Units Granted Under the Award.  The Units granted under the Award shall have no initial value.

3.2.          Adjustment of Number of Units Granted Under Award.  Except as specifically indicated below, if the Participant is not employed by the Trust or a Subsidiary of the Trust during the entire period from the Grant Date to the third annual anniversary thereof (the “Third Anniversary”), the Participant’s total number of Units will be zero.  Otherwise, the total number of Units actually issued under the Award will be determined as of the Third Anniversary in accordance with the following:

If the Trust’s Average Annual Return exceeds the Average T-Note Rate by:	less than .99%	1-1.99%	2%	3%	4%	5%	6%	7% or greater
Then, Participant will receive a number of Units equal to the number of Units initially granted under Article 1.1 times the following percentage:	0%	50%	100%	115%	135%	165%	190%	225%

Any fractional or partial Units will be rounded to the next highest whole number.  The percentages set forth above serve as measurement guidelines.  Accordingly, if the Trust’s Average Annual Return exceeds the Average T-Note Rate by an amount which falls between any of the percentages sets forth in this Section 3.2 in excess of 2%, the Participant’s award will be determined by extrapolation by multiplying the Award on a pro-rata basis by a percentage which directly corresponds to the Trust’s actual Average Annual Return based upon the guidelines set forth above.

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For example, if the Trust’s Average Annual Return exceeds the Average T-Note Rate by 2.5% for the three-year period, the Participant’s initial number of Units will be multiplied by 107.5%.

3.3.          Definitions. The “Average Annual Return” will be expressed as an annual percentage (i.e., the average of the 2005, 2006 and 2007 calendar years) utilizing the sum of the following two numbers:  (i) the average of the Common Share dividends paid or declared during each calendar year as a percentage of the closing price of a Share as of January 3, 2005 -  the first business day in January, 2005 (i.e. $35.45); and (ii) the average percentage change in Funds from Operation as announced by the Trust (“FFO”) calculated for each calendar year per Share over the prior calendar year.  In the event of a change in the Trust’s calculation of FFO, the Trust shall calculate the percentage change in FFO on a consistent basis most favorable to the Participant.  The “Average T-Note Rate” will be expressed as an annual percentage (i.e., the average of the 2005, 2006 and 2007 calendar years) utilizing the 10-year Treasury Note interest rate as of the first business day in January of each calendar year.

3.4.          Conversion of Awards. On the Third Anniversary, the final number of Units granted pursuant to this Award (if any) will be converted into Shares that are subject to the restrictions set forth in Section 4.3 (“Restricted Shares”).  The number of Units which convert shall equal the number of Restricted Shares to be received by the Participant upon conversion.

3.5.          Conversion of Units Upon Death, Disability, Retirement or Change in Control.  Notwithstanding the foregoing, in the event of the Participant’s termination of employment with the Trust or any Subsidiary prior to the Valuation Date due to Death, Disability or retirement at or after age 62, the greater of:  (i) the number of Units initially granted under the Award or (ii) the number of Units a Participant would receive pursuant to Section 3.2 calculated as of said date; shall become fully convertible into fully vested, non-restricted Shares.  Furthermore, in the event of a Change in Control prior to the Valuation Date, 225% of the Units initially granted under the Award shall become fully convertible into fully vested non-restricted Shares as of said Date.

ARTICLE 4

RESTRICTED SHARES

4.1.          General. Upon the Third Anniversary, the Trust shall issue Shares to the Participant in an amount equal to the number of Units determined under Section 3.2, provided the Participant remains employed by the Trust or a Subsidiary of the Trust on such date. Fifty percent of the Shares shall vest immediately upon the Third Anniversary and 50% of the Shares shall be issued as Restricted Shares.  Thereafter, 50% of the total number of Restricted Shares shall vest upon each subsequent anniversary of the Grant Date provided the Participant remains employed by the Trust or a Subsidiary of the Trust on such date (the “Restriction Period”).

4.2.          Awards and Certificates. Upon conversion of the Units granted under Section 3.2, the Participant shall be issued a certificate for the number of his or her Restricted Shares.  Such certificate shall be registered in the name of the Participant and shall bear an appropriate legend referring to the terms, conditions and restrictions applicable to such Restricted Shares. The Committee may require that the certificates evidencing Restricted Shares be held in custody by the

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Trust until the restrictions thereon shall have lapsed and that, as a condition of any award of Restricted Shares, the Participant shall have delivered a stock power, endorsed in blank, relating to the Shares covered by such Award.

4.3.          Terms and Conditions. Restricted Shares shall be subject to the following terms and conditions:

                (a)           Limitations on Transferability. Subject to the provisions of the Plan and Section 4.3(b), during the vesting period described in Section 4.1, the Participant shall not be permitted to sell, assign, transfer, pledge or otherwise encumber any unvested interest in the Restricted Shares.

                (b)           Rights. Except as provided in Section 4.3(a), the Participant shall have, with respect to the Restricted Shares, all of the rights of a shareholder of the Trust holding the class of Shares that is the subject of the Restricted Shares, including, but not limited to, the right to vote the Shares, the right to receive any dividends on the Shares or tender the Shares pursuant to a tender offer extended to all shareholders of the Trust.

                (c)           Acceleration. Based on service, performance by the Participant or by the Trust, including any division or department for which the Participant is employed, or such other factors or criteria as the Committee may determine, the Committee may, in its sole discretion, provide for the lapse of restrictions in installments and may accelerate the vesting of all or any part of any Award and waive the restrictions for all or any part of such Award.

                (d)           Forfeiture.  The restrictions shall lapse and the Participant shall be fully vested in the Restricted Shares if during the Restricted Period:  (i) a Change in Control of the Company occurs; or (ii) in the event of the Participant’s termination of employment with the Trust or any Subsidiary due to Death, Disability, or retirement at or after age 62. Upon a Participant’s termination of employment for any other reason during the Restriction Period (excluding a termination of employment following a Change in Control), all Restricted Shares shall be forfeited by the Participant, except the Committee shall have the sole discretion to waive in whole or in part any or all remaining restrictions with respect to any or all of the Participant’s Restricted Shares.

                (e)           Delivery. If and when the Restriction Period expires without a prior forfeiture of the Restricted Shares subject to such Restriction Period, unlegended certificates (except for legends relating to applicable securities laws) for such Shares shall be delivered to the Participant.

ARTICLE 5

MISCELLANEOUS

5.1.          Amendments and Termination. This Grant may be amended, altered or discontinued upon subsequent written agreement executed by the Committee and the Participant.  However, no amendment, alteration or discontinuation shall be made which would (a) impair the rights of a

4

Participant under this Grant without the Participant’s consent, except such an amendment made to cause the Plan to qualify for the exemption provided by Rule 16b-3 of the Act or (b) disqualify the Plan from the exemption provided by Rule 16b-3. In addition, no such amendment shall be made without the approval of the Trust’s shareholders to the extent such approval is required by law or agreement.

5.2.          General Provisions.

                (a)           Withholding. No later than the date as of which an amount first becomes includible in the gross income of the Participant for Federal income tax purposes with respect to any Award, the Participant shall pay to the Trust (or other entity identified by the Committee), or make arrangements satisfactory to the Trust or other entity identified by the Committee regarding the payment of, any Federal, state, local or foreign taxes of any kind required by law to be withheld with respect to such amount required in order for the Trust or an Affiliate to obtain a current deduction.  Unless otherwise determined by the Committee, withholding obligations may be settled with Shares, including Shares that are part of the Award that gives rise to the withholding requirement, provided that any applicable requirements under Section 16 of the Act are satisfied. The obligations of the Trust under the Plan shall be conditional on such payment or arrangements, and the Trust or any Subsidiary of the Trust shall, to the extent permitted by law, have the right to deduct any such taxes from any payment otherwise due to the Participant.

                (b)           Designation of Representative. Pursuant to a form provided by the Committee, a Participant shall designate a beneficiary (“Beneficiary”) to whom any amounts payable in the event of the Participant’s death are to be paid.

                (c)           Controlling Law. This Grant shall be governed by and construed in accordance with the laws of the State of Maryland (other than its law respecting choice of law) to the extent not governed by Federal law. The Grant shall be construed to comply with all applicable law and to avoid liability to the Trust or the Participant, including, without limitation, liability under Section 16(b) of the Act.

                (d)           Fail Safe. If the Participant is subject to Section 16 of the Act, transactions under this Grant will comply with all applicable conditions of Rule 16b-3 or Rule 16a-l(c)(3), as applicable. To the extent any provision of the Grant or action by the Committee fails to so comply, it shall be deemed null and void, to the extent permitted by law and deemed advisable by the Committee. Moreover, in the event this Grant does not include a provision required by Rule 16b-3 or Rule 16a-­1 (c)(3) to be stated herein, such provision (other than one relating to eligibility requirements or the price and amount of Awards) shall be deemed to be incorporated by reference into this Grant with respect to the Participant.

5.3.          No Rights with Respect to Continuance of Employment.  Nothing contained herein shall be deemed to alter the relationship between the Trust or a Subsidiary of the Trust and the Participant, or the contractual relationship between a Participant and the Trust or a Subsidiary of the Trust (written or otherwise) regarding such relationship. Nothing contained herein shall be

5

construed to constitute a contract of employment between the Trust or a Subsidiary of the Trust and the Participant. The Trust or a Subsidiary of the Trust and the Participant continues to have the right to terminate the employment or service relationship at any time for any reason, except as provided in a written contract. The Trust or a Subsidiary of the Trust shall have no obligation to retain the Participant in its employ or service as a result of this Grant.  There shall be no inference as to the length of employment or service hereby, and the Trust or a Subsidiary of the Trust reserves the same rights to terminate the Participant’s employment or service as existed prior to the individual’s becoming a Participant in the Plan.

5.4.          Delay. If at the time the Participant incurs a termination of employment (other than due to Cause) or if at the time of a Change in Control, the Participant is subject to “short-­swing” liability under Section 16(b) of the Act, any time period provided for under the Plan or the Grant to the extent necessary to avoid the imposition of liability shall be suspended and delayed during the period the Participant would be subject to such liability, but not more than six (6) months and one (1) day.  The Trust shall have the right to suspend or delay any time period described in the Plan or this Grant if the Committee shall determine that the action may constitute a violation of any law or result in liability under any law to the Trust, a Subsidiary of the Trust or a shareholder of the Trust until such time as the action required or permitted shall not constitute a violation of law or result in liability to the Trust, a Subsidiary of the Trust or a shareholder of the Trust. The Committee shall have the discretion to suspend the application of the provisions of the Plan required solely to comply with Rule 16b-3 if the Committee shall determine that Rule 16b-3 does not apply to this Grant.

5.5.          Headings.  The headings contained in this Grant are for reference purposes only and shall not affect the meaning or interpretation of this Grant.

5.6.          Severability.  If any provision of this Grant shall for any reason be held to be invalid or unenforceable, such invalidity or unenforceability shall not effect any other provision hereby, and this Grant shall be construed as if such invalid or unenforceable provision were omitted.

5.7.          Successors and Assigns. This Grant shall inure to the benefit of and be binding upon each successor and assign of the Trust. All obligations imposed upon a Participant, and all rights granted to the Trust hereunder, shall be binding upon the Participant’s heirs, legal representatives and successors.

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5.8.          Entire Grant. The Plan and this Grant constitute the entire agreement with respect to the subject matter hereof and thereof, provided that in the event of any inconsistency between the Plan and the Grant, the terms and conditions of this Plan shall control unless specific contrary reference has been made in this Grant.

                Executed on this          day of March, 2005.

	EQUITY RESIDENTIAL
	By:
		John Powers
		Senior Vice President
Accepted this                day of March, 2005.

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EX-10.22

Exhibit 10.22

FIRST AMENDMENT TO

AMENDED AND RESTATED COMPENSATION AGREEMENT

THIS FIRST AMENDMENT TO AMENDED AND RESTATED COMPENSATION AGREEMENT (“Agreement”) is entered into this 3^rd day of February, 2005 by and between Samuel Zell (“Chairman”) and Equity Residential (“Company”), a Maryland real estate investment trust.

RECITALS

WHEREAS, the Chairman has served as Chairman of the Company’s Board of Trustees since 1993;

WHEREAS, in recognition of the extraordinary services previously rendered by Chairman and to give Chairman incentive to continue rendering such services, the Company and the Chairman entered into an Amended and Restated Compensation Agreement dated March 5, 2003 (the “2003 Agreement”); and

WHEREAS, the Company and the Chairman desire to amend the 2003 Agreement to provide for an extension of the 2003 Agreement for a two-year period.

NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein, and for other good and valuable consideration, the payment and adequacy of which is hereby acknowledged, the parties agree to amend the 2003 Agreement as follows:

1.Chairman’s Compensation.There is hereby added to Paragraph A ofSection I of the 2003 Agreement, the following:

A.In each of the months of February 2005 and February 2006, for services rendered during the calendar year preceding the date of grant, the Company shall grant Chairman share options in the Company (the “Share Options Grant”) and restricted common shares of Company stock (the “Restricted Shares Grant”) having a combined total dollar value of $3,250,000.  The February 2005 grant, in the amount of $3,250,000, shall be allocated 25% to the Share Options Grant and 75% to the Restricted Shares Grant.

The February 2006 grant of $3,250,000 shall be allocated between the Share Options Grant and Restricted Shares Grant in the same ratio as approved by the Company’s Board of Trustees for the annual long-term incentive grants to the Company’s executive officers; provided, however, if the Chief Executive Officer and the other executive officers do not all receive the same relative allocation of Share Options Grant and Restricted Shares Grant, Chairman’s relative allocation shall be the same as that of the Chief Executive Officer.

2.Company’s Plan.    The Company represents to Chairman that it has adopted a successor Plan, the 2002 Share Incentive Plan, and that there shall always be sufficient Shares under such Plan available for issuance to cover the potential awards to

Chairman.  The Company further represents that such successor Plan is, insofar as it affects Chairman, substantially equivalent to the 1993 Plan and is not inconsistent with any provision of the 2003 Agreement, as extended through the February 2006 grant.  The Company further represents to Chairman that in the unlikely event such successor Plan is terminated, the Company shall be required to provide Chairman with substantially equivalent substitute awards.

3.Term and Compensation Upon Termination.    InSection II of the 2003 Agreement, the last line of Paragraph A is hereby amended by deleting the date “January 2004” and substituting “February 2006” therefor.

4.Reaffirmation.  Except as expressly amended and modified under this Agreement, the terms and provisions of the 2003 Agreement are hereby ratified and affirmed in their entirety.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written.

EQUITY RESIDENTIAL, a Maryland real estate investment trust
By:	/s/ Bruce W. Duncan
	Bruce W. Duncan, President & CEO
Address:
Two North Riverside Plaza
Suite 400
Chicago, Illinois 60606
CHAIRMAN:
	/s/ Samuel Zell
	SAMUEL ZELL, Chairman
Address:
Two North Riverside Plaza
Suite 600
Chicago, Illinois 60606

EX-12

Exhibit 12

EQUITY RESIDENTIAL

Computation of Ratio of Earnings to Combined Fixed Charges

	12/31/04			12/31/03			12/31/02			12/31/01			12/31/00
Income from continuing operations	$	135,276		$	157,867		$	188,114		$	242,238		$	207,800
Interest expense incurred, net	342,591			322,903			327,662			336,632			348,031
Amortization of deferred financing costs	6,723			5,612			5,502			4,807			4,849
Allocation to Minority Interests:
Operating Partnership	31,228			34,658			26,862			32,391			41,761
Preference Interests	19,420			20,211			20,211			18,263			10,650
Junior Preference Units	70			325			325			352			436
Premium on redemption of Preference Interests	1,117			—			—			—			—
Earnings before combined fixed charges and preferred distributions	536,425			541,576			568,676			634,683			613,527
Preferred Share distributions	(53,746		)	(76,435		)	(76,615		)	(87,504		)	(100,855		)
Premium on redemption of Preferred Shares	—			(20,237		)	—			(5,324		)	—
Preference Interest distributions	(19,420		)	(20,211		)	(20,211		)	(18,263		)	(10,650		)
Junior Preference Unit distributions	(70		)	(325		)	(325		)	(352		)	(436		)
Premium on redemption of Preference Interests	(1,117		)	—			—			—			—
Earnings before combined fixed charges	$	462,072		$	424,368		$	471,525		$	523,240		$	501,586
Interest expense incurred, net	$	342,591		$	322,903		$	327,662		$	336,632		$	348,031
Amortization of deferred financing costs	6,723			5,612			5,502			4,807			4,849
Interest capitalized for real estate and unconsolidated entities under development	13,969			20,647			27,167			28,174			17,650
Total combined fixed charges	363,283			349,162			360,331			369,613			370,530
Preferred Share distributions	53,746			76,435			76,615			87,504			100,855
Premium on redemption of Preferred Shares	—			20,237			—			5,324			—
Preference Interest distributions	19,420			20,211			20,211			18,263			10,650
Junior Preference Unit distributions	70			325			325			352			436
Premium on redemption of Preference Interests	1,117			—			—			—			—
Total combined fixed charges and preferred distributions	$	437,636		$	466,370		$	457,482		$	481,056		$	482,471
Ratio of earnings before combined fixed charges to total combined fixed charges	1.27			1.22			1.31			1.42			1.35
Ratio of earnings before combined fixed charges and preferred distributions to total combined fixed charges and preferred distributions	1.23			1.16			1.24			1.32			1.27

EX-21

Exhibit 21

LIST OF SUBSIDIARIES OF EQUITY RESIDENTIAL

	ENTITY
1	1145 Acquisition , LLC
2	AMBERTON APARTMENTS, LLC
3	AMBERWOODS APTS OF BARTOW COUNTY, LTD
4	AMERWOODS APTS OF BARTOW COUNTY, II, LTD
5	ANE ASSOCIATES, LLC
6	ANNHURST APTS OF COLUMBUS, LTD
7	APPLE RIDGE APTS OF CIRCLEVILLE, II, LTD
8	ARGUS LAND COMPANY, INC.
9	ARTERY NORTHAMPTON LIMITED PARTNERSHIP
10	AVON PLACE ASSOCIATES, LLC
11	BALATON CONDOMINIUM ASSOCIATION
12	BALATON CONDOMINIUM, LLC
13	BARCELONA CONDOMINIUM, LLC
14	BARRINGTON APTS OF BEDFORD, LTD
15	BEL APARTMENT PROPERTIES TRUST
16	BEL COMMUNITIES PROPERTY TRUST
17	BEL MULTIFAMILY PROPERTY TRUST
18	BEL MULTIFAMILY, LLC
19	BEL RESIDENTIAL PROPERTIES TRUST
20	BEL-APT, L.L.C.
21	BEL-COMMUNITIES, LLC
22	BEL-EQR I LIMITED PARNTERSHIP
23	BEL-EQR I, L.L.C.
24	BEL-EQR II LIMITED PARNTERSHIP
25	BEL-EQR II, L.L.C.
26	BEL-EQR III, LIMITED PARTNERSHIP
27	BEL-EQR III, LLC
28	BEL-EQR IV, LIMITED PARTNERSHIP
29	BEL-EQR IV, LLC
30	BEL-EQR NORTHLAKE GP, LLC
31	BEL-RES, L.L.C.
32	BRIDGE POINT APTS, LTD
33	BROOKSIDE PLACE ASSOCIATES, L.P.
34	BROOKSIDE PLACE G.P. CORP.
35	BUENA VISTA PLACE ASSOCIATES
36	CANTERBURY APARTMENTS, LLC
37	CANYON CREEK VILLAGE ASSOCIATES, L.P.
38	CANYON CREEK VILLAGE G.P. CORP.
39	CAPREIT Arbor Glen L.P.
40	CAPREIT Woodcrest Villa L.P.
41	CARDINAL APTS SERVICES, INC.
42	CARDINAL ASSOCIATES CENTRAL MANAGEMENT
43	CARDINAL DIVERSIFIED PROPERTIES
44	CARDINAL GP XII CORP
45	CARDINAL IND OF FLORDIA SERVICES CORP
46	CARLETON COURT APTS OF ANN ARBOR, LTD
47	CENTERPOINT APARTMENT ASSOC, LTD
48	CHINATOWN GATEWAY, LLC
49	COBBLESTONE VILLAGE COMMUNITY RENTALS, L.P.
50	COBBLESTONE VILLAGE G.P. CORP.
51	CORPORATE QUARTERS, INC.
52	CORPORATE STAY INTERNATIONAL, INC.
53	COUNTRY CLUB ASSOCIATES LIMITED PARTNERSHIP
54	COUNTRY CLUB CONDOMINIUM, LLC
55	COUNTRY OAKS ASSOCIATES, L.P.
56	COUNTRY OAKS G.P. CORP.
57	COUNTRY RIDGE GENERAL PARTNERSHIP
58	COVE INVESTMENTS, LLC
59	CRC, LLC
60	CRICO of Trailway Pond II, L.P.
61	CRICO of White Bear Woods I, L.P.
62	CRICO of Ethan’s I, L.P.
63	CRICO of Ethan’s II, L.P.
64	CRICO of Fountain Place, L.P.
65	CRICO of James Street Crossing, L.P.
66	CRICO of Ocean Walk, L.P.

	ENTITY
67	CRICO of Trailway Pond I, L.P.
68	CRICO of Valley Creek I, L.P.
69	CRICO of Valley Creek II, L.P.
70	CRICO Royal Oaks, L.P.
71	CRP SERVICE COMPANY, LLC
72	CRSI SPV 103, INC.
73	CRSI SPV 1996 PW2, INC.
74	CRSI SPV 1996 PW3, INC.
75	CRSI SPV 30231, LLC
76	CRSI SPV 35, LLC
77	CRSI SPV 59, LLC
78	CRSI SPV 95, INC.
79	CRSI SPV 96, LLC
80	DEERFIELD ASSOCIATES, L.P.
81	DEERFIELD G.P. CORP.
82	DEL REY II, LLC
83	DUXFORD, LLC
84	EC-BORDEAUX, LLC
85	EC-GRAND MARQUIS, LLC (FKA EC-GRAND CANAL, LLC)
86	ECH-GFR, INC. (FKA GLOBE FURNITURE RENTALS, INC.)
87	EC-STERLING HEIGHTS, LLC
88	EC-TUSCANY VILLAS, LLC
89	EC-VENETIAN II LLC
90	EDGEWATER COMMUNITY RENTALS, L.P.
91	EDGEWATER G.P. CORP.
92	E-LODGE ASSOCIATES LIMITED PARTNERSHIP
93	EQR (1999) HAMPDEN TOWN CENTER, LLC
94	EQR (1999) HOMESTEAD, LLC (FKA EQR/LEGACY PARTNERS 1999 HOMESTEAD, LLC)
95	EQR (1999) MASTER LLC (FKA EQR/LEGACY PARTNERS 1999 MASTER, LLC)
96	EQR (1999) TOWERS LLC (FKA EQR/LEGACY PARTNERS 1999 TOWER, LLC)
97	EQR (1999) WARNER RIDGE LLC (FKA EQR/LEGACY PARTNERS 1999 WARNER RIDGE, LLC)
98	EQR (1999) WARNER RIDGE PHASE III LLC (FKA EQR/LEGACY PARTNERS 1999 WR III, LLC)
99	EQR NO. FOUR MASTER LP (FKA: EQR/LINCOLN NO. FOUR MASTER LP)
100	EQR NO. ONE MASTER LP (FKA: EQR/LINCOLN NO. ONE MASTER LP)
101	EQR NO. THREE MASTER LP (FKA: EQR/LINCOLN NO. THREE MASTER LP)
102	EQR NO. TWO MASTER LP (FKA: EQR/LINCOLN NO. TWO MASTER LP)
103	EQR/KB CALIFORNIA RCI, LLC
104	EQR/KB CALIFORNIA RCI, LLC
105	EQR/LINCOLN FORT LEWIS COMMUNITIES, LLC
106	EQR/LINCOLN FT. LEWIS COMMUNITIES, LLC
107	EQR/Lincoln RCI Southeast LLC
108	EQR-71 BROADWAY A, LLC
109	EQR-71 BROADWAY B, LLC
110	EQR-71 BROADWAY C, LLC
111	EQR-71 BROADWAY D, LLC
112	EQR-71 BROADWAY E, LLC
113	EQR-71 BROADWAY F, LLC
114	EQR-740 RIVER DRIVE, LLC
115	EQR-ALEXANDRIA (FKA: EQR-LINCOLN ALEXANDRIA, LLC)
116	EQR-ARBORS FINANCING, LP
117	EQR-ARIZONA, L.L.C.
118	EQR-ARTCAPLOAN, L.L.C.
119	EQR-AUTUMN RIVER, LLC
120	EQR-BAY HILL, LLC
121	EQR-BELLAGIO, LLC
122	EQR-BELLEVUE MEADOW GP LP
123	EQR-BELLEVUE MEADOW LP
124	EQR-BENEVA PLACE, INC.
125	EQR-BENEVA PLACE, LLC
126	EQR-BOND PARTNERSHIP
127	EQR-BRAINTREE, LLC
128	EQR-BRAMBLEWOOD GP LP
129	EQR-BRAMBLEWOOD LP
130	EQR-BRETON HAMMOCKS FINANCING LIMITED PARTNERSHIP
131	EQR-BRIARWOOD GP LP
132	EQR-BRIARWOOD LP
133	EQR-BROADWAY LP

	ENTITY
134	EQR-BROOKDALE VILLAGE, LLC
135	EQR-BS FINANCING LIMITED PARTNERSHIP
136	EQR-CALIFORNIA EXCHANGE, LLC (FKA EQR-REGATTA, LLC)
137	EQR-CEDAR RIDGE GP, LLC
138	EQR-CEDAR RIDGE LP
139	EQR-CENTENNIAL COURT, LLC
140	EQR-CENTENNIAL TOWER, LLC
141	EQR-CHARDONNAY PARK, L.L.C.
142	EQR-CHASE KNOLLS LENDER, LLC
143	EQR-CHICKASAW CROSSING, INC.
144	EQR-CHICKASAW CROSSING, LLC
145	EQR-CHINATOWN GATEWAY, LLC
146	EQR-CHURCH CORNER, LLC
147	EQR-COACHMAN TRAILS, LLC
148	EQR-CODELLE LIMITED PARTNERSHIP
149	EQR-CODELLE, LLC
150	EQR-CONNOR LIMITED PARTNERSHIP
151	EQR-CONNOR, LLC
152	EQR-CREEKSIDE OAKS GENERAL PARTNERSHIP
153	EQR-CYPRESS LAKE, LLC
154	EQR-DEER CREEK, LLC
155	EQR-EASTBRIDGE, LLC
156	EQR-EASTBRIDGE, LP
157	EQR-EMERALD PLACE FINANCING LIMITED PARTNERSHIP
158	EQR-ESSEX PLACE FINANCING LIMITED PARTNERSHIP
159	EQR-FAIRFAX CORNER II, LLC (FKA: ERP/Vistas-Fairfax Corner, LLC)
160	EQR-FAIRFAX CORNER, LLC
161	EQR-FAIRFIELD, LLC
162	EQR-FANCAP 2000A LIMITED PARTNERSHIP
163	EQR-FANCAP 2000A, LLC (d/b/a EQR-TENNESSEE LOAN PORTFOLIO, LLC)
164	EQR-FANKEY 2004 LIMITED PARTNERSHIP
165	EQR-FANKEY 2004, LLC
166	EQR-FERNBROOK, LLC
167	EQR-FIELDERS CROSSING GP, LLC
168	EQR-FIELDERS CROSSING LP
169	EQR-FLATLANDS, LLC
170	EQR-FOREST PLACE, INC.
171	EQR-FOREST PLACE, LLC
172	EQR-GEORGIAN WOODS, LLC
173	EQR-GRANDVIEW II GP, LP
174	EQR-GRANDVIEW II LP
175	EQR-GREENHAVEN GP LP
176	EQR-GREENHAVEN LP
177	EQR-HAMPSHIRE PLACE, LLC
178	EQR-HIGHLANDS RANCH, LLC
179	EQR-HILL CHAVEZ, LLC (FKA EQR-MARKS EAST, LLC)
180	EQR-HOLDING, LLC
181	EQR-HOLDING, LLC2
182	EQR-HORIZON PLACE, INC.
183	EQR-HORIZON PLACE, LLC
184	EQR-HUDSON CROSSING A, LLC
185	EQR-HUDSON CROSSING B, LLC
186	EQR-HUDSON CROSSING C, LLC
187	EQR-HUDSON CROSSING D, LLC
188	EQR-HUDSON CROSSING E, LLC
189	EQR-HUDSON POINTE, LLC (FKA: EQR-LINCOLN HUDSON POINTE, LLC)
190	EQR-IVORY WOOD, LLC
191	EQR-LAKESHORE AT PRESTON LP
192	EQR-LAKEWOOD GREENS GP, LLC
193	EQR-LAKEWOOD GREENS LP
194	EQR-LAWRENCE, LLC
195	EQR-LEXFORD LENDER, LLC
196	EQR-LEXINGTON FARM, LLC
197	EQR-LEXINGTON FARM, LLC
198	EQR-LINCOLN BRAINTREE, LLC
199	EQR-LINCOLN VILLAGE (CA) I GP LP
200	EQR-LINCOLN VILLAGE (CA) I LP

	ENTITY
201	EQR-LINCOLN VILLAGE (CA) II GP LP
202	EQR-LINCOLN VILLAGE (CA) II LP
203	EQR-LODGE (OK) GP LIMITED PARTNERSHIP
204	EQR-LOMBARD, LLC (FKA LINCOLN LOMBARD, LLC)
205	EQR-LOUDOUN, LLC (FKA: EQR-LINCOLN LOUDOUN, LLC)
206	EQR-LPC URBAN RENEWAL NORTH PIER, LLC
207	EQR-MARINA BAY, LLC (FKA: EQR-LINCOLN MARINA BAY, LLC)
208	EQR-MARKS A, L.L.C.
209	EQR-MARKS B, L.L.C.
210	EQR-MARKS WEST, LLC
211	EQR-MARTINS LANDING, LLC
212	EQR-MET CA FINANCING LIMITED PARTNERSHIP
213	EQR-MILL CREEK, LLC
214	EQR-MISSION HILLS, LLC
215	EQR-MISSOURI, L.L.C.
216	EQR-MLP 1, LLC
217	EQR-MLP 2, LLC
218	EQR-MLP 3, LLC
219	EQR-MLP 4, LLC
220	EQR-MONTERRA, LLC
221	EQR-MOSAIC, LLC
222	EQR-MOUNTAIN SHADOWS GP LP
223	EQR-MOUNTAIN SHADOWS LP
224	EQR-NEW LLC
225	EQR-NEW LLC2
226	EQR-NEW LLC3
227	EQR-NORTH CREEK, LLC
228	EQR-NORTH HILL, L.L.C.
229	EQR-NORTH PIER, LLC (FKA: EQR-LINCOLN NORTH PIER, LLC)
230	EQR-OVERLOOK MANOR II, LLC
231	EQR-PALM HARBOR, LLC
232	EQR-PARKSIDE, GP LP
233	EQR-PARKSIDE, LP
234	EQR-PEACHTREE A, LLC
235	EQR-PEACHTREE B, LLC
236	EQR-PEACHTREE, LLC (FKA: EQR-LINCOLN PEACHTREE, LLC)
237	EQR-PERIMETER CENTER, LLC (FKA: EQR-LINCOLN PERIMETER CENTER, LLC)
238	EQR-PIEDMONT, LLC (FKA: EQR-LINCOLN PIEDMONT, LLC)
239	EQR-PINETREE/WESTBROOKE, LLC
240	EQR-PLANTATION, L.L.C.
241	EQR-PROSPECT TOWERS PHASE II LLC
242	EQR-QRS HIGHLINE OAKS, INC
243	EQR-QRS WYNDRIDGE II, INC.
244	EQR-QRS WYNDRIDGE III, INC.
245	EQR-Ranch at Fossil Creek, L.L.C.
246	EQR-Ranch at Fossil Creek, L.P.
247	EQR-RETAIL MARKS, LLC
248	EQR-RID SP,LLC
249	EQR-RIVEROAKS, LLC
250	EQR-RIVERVIEW CONDOS, LLC
251	EQR-RIVERWALK, LLC
252	EQR-S & T, LLC
253	EQR-SABLE PALM AT LAKE BUENA VISTA, INC.
254	EQR-SABLE PALM AT LAKE BUENA VISTA, LLC
255	EQR-SANDSTONE LP
256	EQR-SCAKRBOROUGH SQUARE, LLC
257	EQR-SHADOW CREEK, LLC
258	EQR-SIENA TERRACE, LLC
259	EQR-SMOKETREE, LLC
260	EQR-SONTERRA AT FOOTHILLS RANCH LP
261	EQR-SOUTHWOOD GP LP
262	EQR-SOUTHWOOD LP
263	EQR-SOUTHWOOD LP I LP
264	EQR-SOUTHWOOD LP II LP
265	EQR-STONELEIGH A, LLC
266	EQR-STONELEIGH B, LLC
267	EQR-SUERTE, LLC

	ENTITY
268	EQR-SUMMER CREEK, LLC
269	EQR-SUMMERWOOD GP LP
270	EQR-SUMMERWOOD LP
271	EQR-SURREY DOWNS LP LP
272	EQR-SWN LINE FINANCING LIMITED PARTNERSHIP
273	EQR-TALLEYRAND, LLC
274	EQR-THE CARLYLE, LLC
275	EQR-THE CARLYLE, LP
276	EQR-THE LAKES AT VININGS, LLC
277	EQR-THE OAKS, LLC
278	EQR-THE PALMS, LLC
279	EQR-THE RETREAT, LLC
280	EQR-THE WATERFORD AT DEERWOOD, INC.
281	EQR-THE WATERFORD AT DEERWOOD, LLC
282	EQR-THE WATERFORD AT ORANGE PARK, INC.
283	EQR-THE WATERFORD AT ORANGE PARK, LLC
284	EQR-THE WATERFORD AT REGENCY, INC.
285	EQR-THE WATERFORD AT REGENCY, LLC
286	EQR-TOWN CENTER, LLC
287	EQR-TOWNHOMES OF MEADOWBROOK, LLC
288	EQR-TRAILS AT DOMINION GENERAL PARTNERSHIP
289	EQR-URBAN RENEWAL JERSEY CITY, LLC (FKA EQR-LINCOLN URBAN RENEWAL JERSEY CITY, LLC)
290	EQR-VALENCIA, LLC (AKA EQR-PORTOFINO, LLC)
291	EQR-VILLA LONG BEACH, LLC
292	EQR-VILLA SERENAS SUCCESSOR BORROWER, LLC
293	EQR-VILLAS OF JOSEY RANCH GP, LLC
294	EQR-VILLAS OF JOSEY RANCH LP
295	EQR-VININGS AT ASHLEY LAKE, L.L.C.
296	EQR-WARWICK, L.L.C.
297	EQR-WATERFALL, L.L.C.
298	EQR-WATERMARKE I, LLC
299	EQR-WATERMARKE II, LLC
300	EQR-WATSON G.P.
301	EQR-WEST COAST PORTFOLIO GP, LLC
302	EQR-WESTFIELD VILLAGE, LLC
303	EQR-WESTPORT, LLC (FKA: EQR-LINCOLN WESTPORT, LLC)
304	EQR-WHISPER CREEK, LLC
305	EQR-WIMBLEDON OAKS LP
306	EQR-WINDSOR AT FAIR LAKES, LLC
307	EQR-WOOD FOREST, INC.
308	EQR-WOOD FOREST, LLC
309	EQR-WOODRIDGE I GP LP
310	EQR-WOODRIDGE I LP
311	EQR-WOODRIDGE II GP LP
312	EQR-WOODRIDGE II LP
313	EQR-WOODRIDGE III LP
314	EQR-WOODRIDGE, LLC
315	EQR-WYNDRIDGE II, L.L.C.
316	EQR-WYNDRIDGE III, L.L.C.
317	EQR-ZURICH, LLC (FKA: EQR-LINCOLN ZURICH, LLC)
318	EQUITY APARTMENT MANAGEMENT, LLC (AKA LEXFORD PROPERTIES MANAGEMENT, LLC)
319	EQUITY COMMUNITY FOUNDATION
320	EQUITY CORPORATE HOUSING HOLDING CO., INC. (FKA: GLOBE HOLDING CO., INC.)
321	EQUITY CORPORATE HOUSING, INC. (FKA:GLOBE BUSINESS RESOURCES, INC.)
322	EQUITY MARINA BAY PHASE II, LLC (FKA LINCOLN MARINA BAY PHASE II, LLC)
323	EQUITY RESIDENTIAL CONDOMINIUMS, LLC
324	EQUITY RESIDENTIAL FOUNDATION (FKA Equity Community Foundation)
325	EQUITY RESIDENTIAL MORTGAGE COMPANY, LLC
326	EQUITY RESIDENTIAL MORTGAGE HOLDING CORPORATION
327	EQUITY RESIDENTIAL PROPERTIES MANAGEMENT CORP
328	EQUITY RESIDENTIAL PROPERTIES MANAGEMENT CORP II
329	EQUITY RESIDENTIAL PROPERTIES MANAGEMENT CORP PROTECTIVE TRUST
330	EQUITY RESIDENTIAL PROPERTIES TRUST (POST WRP MERGER)
331	EQUITY-LODGE VENTURE LTD.
332	ERP NEW ENGLAND PROGRAM, LLC
333	ERP OPERATING LIMITED PARTNERSHIP
334	ERP-NEW ENGLAND PROGRAM, LLC

	ENTITY
335	ERP-QRS ARBORS, INC.
336	ERP-QRS BRETON HAMMOCKS, INC.
337	ERP-QRS BS, INC.
338	ERP-QRS CEDAR CREST, INC.
339	ERP-QRS CEDAR RIDGE, INC.
340	ERP-QRS COUNTRY CLUB I, INC.
341	ERP-QRS COUNTRY CLUB II, INC.
342	ERP-QRS COUNTRY RIDGE, INC.
343	ERP-QRS CPRT II, INC.
344	ERP-QRS CPRT, INC.
345	ERP-QRS CREEKSIDE OAKS, INC.
346	ERP-QRS EMERALD PLACE, INC.
347	ERP-QRS ESSEX PLACE, INC.
348	ERP-QRS FAIRFIELD, INC.
349	ERP-QRS FLATLANDS, INC.
350	ERP-QRS GEORGIAN WOODS ANNEX, INC.
351	ERP-QRS GLENLAKE CLUB, INC.
352	ERP-QRS GROVE L.P., INC.
353	ERP-QRS HARBOR POINTE, INC.
354	ERP-QRS HUNTER’S GLEN, INC.
355	ERP-QRS LAKEWOOD GREENS, INC.
356	ERP-QRS LINCOLN, INC.
357	ERP-QRS LODGE (OK), INC.
358	ERP-QRS MAGNUM, INC.
359	ERP-QRS MET CA, INC.
360	ERP-QRS MET, INC.
361	ERP-QRS NORTHAMPTON I, INC.
362	ERP-QRS S&T, INC.
363	ERP-QRS SONTERRA AT FOOTHILLS RANCH, INC.
364	ERP-QRS SWN LINE, INC.
365	ERP-QRS TOWNE CENTRE III, INC.
366	ERP-QRS TOWNE CENTRE IV, INC.
367	ERP-QRS TRAILS AT DOMINION, INC. (fka ERP-QRS Marbrisa, Inc.)
368	ERP-QRS WATSON, INC.
369	ERP-SOUTHEAST PROPERTIES, LLC
370	ESSEX SQUARE APTS, LTD
371	EVANS WITHYCOMBE FINANCE, INC
372	EVANS WITHYCOMBE FINANCE, L.P.
373	EVANS WITHYCOMBE MANAGEMENT INC.
374	EVANS WITHYCOMBE RESIDENTIAL LIMITED PARTNERSHIP
375	FEATHER RIVER COMMUNITY RENTALS, L.P.
376	FEATHER RIVER G.P. CORP.
377	FOREST PLACE ASSOCIATES
378	FORSYTHIA COURT APTS OF COLUMBUS, LTD
379	FORT LEWIS COMMUNITIES, LLC
380	FORT LEWIS SPE, INC.
381	FOUR LAKES CONDOMINIUM II, LLC
382	FOUR LAKES CONDOMINIUM III, LLC
383	FOUR LAKES CONDOMINIUM IV, LLC
384	FOUR LAKES CONDOMINIUM V, LLC
385	FOUR LAKES CONDOMINIUM, LLC
386	FOUR LAKES II, LLC.
387	FOURTH TOWNE CENTRE LIMITED PARTNERSHIP
388	FOX RIDGE ASSOCIATES, L.P.
389	FOX RIDGE G.P. CORP.
390	FOXTON APTS OF SEYMOUR, LTD
391	FOXWOODBURG, LLC
392	FPAII, L.P.
393	GARDEN TERRACE APTS, III, LTD
394	GC CHAPARRAL ASSOC, LP
395	GC COUNTRY CLUB WOODS ASSOC, LP
396	GC COUNTRY CLUB WOODS, LP
397	GC GREENBRIAR ASSOC, LTD
398	GC GREENBRIAR, LP
399	GC HESSIAN HILLS ASSOC, LP
400	GC HESSIAN HILLS, LP
401	GC HIGH RIVER ASSOC, LP

	ENTITY
402	GC HIGH RIVER, LP
403	GC PEMBROKE ASSOC, LP
404	GC SOUTHEAST PARTNERS, LP
405	GC SPRING LAKE MANOR ASSOC, LP
406	GC SPRING LAKE MANOR, LP
407	GC THREE CHOPT WEST ASSOC, LP
408	GC THREE CHOPT WEST, LP
409	GC TOWN & COUNTRY/COUNTRY PLACE ASSOC, LP
410	GC TOWN & COUNTRY/COUNTRY PLACE, LP
411	GC TOWNHOUSE ASSOC, LP
412	GC TOWNHOUSE, LP
413	GC TWIN GATES EAST ASSOC, LP
414	GC TWIN GATES EAST, LP
415	GC WILL-O-WISP ARMS, LP
416	GC WILL-O-WISP ASSOC, LP
417	GEARY COURTYARD ASSOCIATES
418	GEORGIAN WOODS ANNEX ASSOCIATES
419	GLENLAKE CLUB L.P.
420	GPT 929 HOUSE, LLC
421	GPT ABINGTON GLEN, LLC
422	GPT ABINGTON LAND, LLC
423	GPT ACTON, LLC
424	GPT BRIAR KNOLL, LLC
425	GPT CC, LLC
426	GPT CEDAR GLEN, LLC
427	GPT CG, LLC
428	GPT CHESTNUT GLEN, LLC
429	GPT CONWAY COURT, LLC
430	GPT EAST HAVEN, LLC
431	GPT EAST PROVIDENCE, LLC
432	GPT ENFIELD, LLC
433	GPT FREEPORT, LLC
434	GPT GLEN GROVE, LLC
435	GPT GLEN MEADOW, LLC
436	GPT GOF II, LLC
437	GPT GOSNOLD GROVE, LLC
438	GPT GP III, LLC
439	GPT HERITAGE GREEN, LLC
440	GPT HG, LLC
441	GPT HIGHLAND GLEN, LLC
442	GPT HIGHMEADOW, LLC
443	GPT HILLTOP, LLC
444	GPT JACLEN TOWER, LLC
445	GPT LONGFELLOW GLEN, LLC
446	GPT LONGMEADOW ASSOCIATES, LLC
447	GPT NEHOIDEN GLEN, LLC
448	GPT NOONAN GLEN, LLC
449	GPT NORTON GLEN, LLC
450	GPT OLD MILL GLEN, LLC
451	GPT PHILLIPS PARK, LLC
452	GPT PLAINVILLE, LLC
453	GPT RG AMHERST, LLC
454	GPT RG FALL RIVER, LLC
455	GPT RG MILFORD, LLC
456	GPT RG, LLC
457	GPT RIBBON MILL, LLC
458	GPT ROCKINGHAM GLEN, LLC
459	GPT SHG, LLC
460	GPT STURBRIDGE, LLC
461	GPT SUMMER HILL GLEN, LLC
462	GPT TANGLEWOOD, LLC
463	GPT WEBSTER GREEN, LLC
464	GPT WEST SPRINGFIELD, LLC
465	GPT WESTFIELD, LLC
466	GPT WESTWOOD GLEN, LLC
467	GPT WG, LLC
468	GPT WILG, LLC

	ENTITY
469	GPT WILKENS GLEN, LLC
470	GPT WINCHESTER WOOD, LLC
471	GPT WINDSOR, LLC
472	GR CEDAR GLEN, LP
473	GR CONWAY COURT, LP
474	GR FARMINGTON SUMMIT, LLC
475	GR HIGHLAND GLEN, LP
476	GR NORTHEAST APARTMENT ASSOCIATES, LLC
477	GR ROCKINGHAM GLEN, LP
478	GR SUMMER HILL GLEN, LP
479	GR WEST HARTFORD CENTRE, LLC
480	GR WESTWOOD GLEN, LP
481	GR WESTWYND ASSOCIATES, LLC
482	GR WILKENS GLEN, LP
483	GRAN TREE CORPORTION
484	GRAND OASIS CONDOMINIUM, LLC
485	GREEN GATE APARTMENTS, LTD
486	GREENGLEN ATPS OF WHEELERSBURG, LTD
487	GREENLEAF APARTMENTS, LTD
488	GREENTREE APARTMENTS LP
489	GR-HERITAGE COURT ASSOCIATES, LLC (FKA GR-HERITAGE COURT ASSOCIATES, LP)
490	GROVE DEVELOPMENT, LLC
491	GROVE OPERATING LP
492	GROVE ROCKY HILL, LLC
493	GUILFORD COMPANY, INC.
494	GUILFORD PARTNERS II
495	HEATHMOORE APTS OF INDIANAPOLIS, II, LTD
496	HESSIAN HILLS APARTMENT ASSOC, LTD
497	HICKORY MILL APTS OF HURRICANE, II, LTD
498	HIDDEN LAKE ASSOCIATES, L.P.
499	HIDDEN LAKE G.P. CORP.
500	HIGH RIVER ASSOC, LTD
501	HIGH RIVER PHASE I, LTD
502	HILLVIEW TERRACE APTS, LTD
503	HUNTERS’S GLEN GENERAL PARTNERSHIP
504	HUNTINGTON, LLC
505	KINGS CROSSING APTS, LTD
506	KINGSPORT APARTMENTS, LLC
507	KISMUL, LLC (FKA KISMUL CORP)
508	LAKEVIEW COMMUNITY RENTALS, L.P.
509	LAKEVIEW G.P. CORP.
510	LAKEWOOD COMMUNITY RENTALS G.P. CORP.
511	LAKEWOOD COMMUNITY RENTALS, L.P.
512	LAKSPUR APTS OF COLUMBUS, II, LTD
513	LANDON LEGACY PARTNERS LIMITED
514	LANDON PRAIRIE CREEK PARTNERS LIMITED
515	LANTERN COVE ASSOCIATES, L.P.
516	LANTERN COVE G.P. CORP.
517	LENOX PLACE LP
518	LEXFORD FLKB II, LLC
519	LEXFORD FLKB, LLC
520	LEXFORD GAKB, LLC
521	LEXFORD GP II, LLC
522	LEXFORD GP XV, LLC
523	LEXFORD GP, LLC
524	LEXFORD GUILFORD GP, LLC
525	LEXFORD GUILFORD LP, LLC
526	LEXFORD GUILFORD, INC.
527	LEXFORD HIDDEN POINTE GP LLC
528	LEXFORD HIDDEN POINTE LP LLC
529	LEXFORD INDUSTRIES DEVELOPMENT, LLC
530	LEXFORD PARTNERS, LLC
531	LEXFORD PROPERTIES, LP
532	LINCOLN MAPLES ASSOCIATES, LLC
533	MCCASLIN HIDDEN LAKES, LTD.
534	MCCASLIN RIVERHILL, LTD.
535	MCKINLEY HILLS PARTNERS-85,

	ENTITY
536	MERIDAN GUILFORD BGP CORPORATION
537	MERIDAN GUILFORD CGP CORPORATION
538	MERIDAN GUILFORD NLPGP CORPORATION
539	MERIDAN GUILFORD PGP CORPORATION
540	MERIDIAN SOUTHEAST PARTNERS, LP
541	MERRY LAND DOWNREIT I LP
542	MESA DEL OSO ASSOCIATES, L.P.
543	MESA DEL OSO G.P. CORP.
544	MOBILE APARTMENT ASSOC, LTD
545	MONTGOMERY REAL ESTATE INVESTORS, LTD
546	MONTROSE SQUARE APTS OF HILLSBORO, II LTD
547	MOULTRIE APTS, LTD
548	MULBERRY APTS OF HILLIARD, LTD
549	MULTIFAMILY PORTFOLIO GP LIMITED PARTNERSHIP
550	MULTIFAMILY PORTFOLIO LP LIMITED PARTNERSHIP
551	MULTIFAMILY PORTFOLIO PARTNERS, INC.
552	NHP HS FOUR, INC.
553	NORTHRIDGE LAKES LP
554	NORTHWOOD APTS, LTD
555	NRL ASSOCIATES LP
556	OAK MILL II APARTMENTS, LLC
557	OAKS AT BAYMEADOWS ASSOCIATES
558	OAKS AT REGENCY ASSOCIATES
559	OLD REDWOODS, LLC
560	OLYMPIAN VILLAGE APTS, LTD
561	PALM SIDE APTS, LTD
562	PARKWOOD VILLAGE APTS OF DOUGLASVILLE, II, LP
563	PARKWOOD VILLAGE APTS OF DOUGLASVILLE, LTD
564	PEMBROKE LAKE APARTMENT ASSOC, LTD
565	PINE GROVE APTS ROSEVILLE, II, LTD
566	PINE GROVE APTS ROSEVILLE,LTD
567	POINTE EAST CONDOMINIUM, LLC
568	PRESERVE CONDOMINIUM HOMES
569	QRS MARKS A, INC.
570	QRS MARKS B, INC.
571	QRS MISSOURI, INC.
572	QRS WARWICK, INC.
573	QRS-740 RIVER DRIVE, INC.
574	QRS-ARBORETUM, INC.
575	QRS-ARTCAPLOAN, INC.
576	QRS-BOND, INC.
577	QRS-CHARDONNAY PARK, INC
578	QRS-CODELLE, INC.
579	QRS-CONNOR, INC.
580	QRS-COVE, INC.
581	QRS-FANCAP 2000A, INC.
582	QRS-FERNBROOK, INC.
583	QRS-GREENTREE I, INC.
584	QRS-LLC, INC.
585	QRS-NORTH HILL, INC
586	QRS-SCARBOROUGH, INC.
587	QRS-SIENA TERRACE, INC.
588	QRS-SMOKETREE, INC.
589	QRS-SUMMIT CENTER, INC.
590	QRS-TOWERS AT PORTSIDE, INC.
591	QRS-TOWNHOMES OF MEADOWBROOK, INC.
592	QRS-VININGS AT ASHLEY LAKE, INC.
593	QRS-WATERFALL, INC.
594	QRS-WOODRIDGE, INC.
595	RAMBLEWOOD APTS OF RICHMOND COUNTY, LTD
596	RAVENWOOD ASSOC, LTD
597	REDWOOD HOLLOW APTS OF SMYRNA, LTD
598	RESERVE SQUARE, INC.
599	RESIDENTIAL INSURANCE AGENCY, LLC (DE)
600	RESIDENTIAL INSURANCE AGENCY, LLC (OH)
601	RICHMOND APARTMENT ASSOC, LTD
602	RIDGEWOOD APTS OF LEXINGTON, II, LTD

	ENTITY
603	RIVERWOOD APTS, LTD
604	ROANOKE APTS OF JEFFERSON COUNTY, LTD
605	SANDLEWOOD APTS OF ALEXANDRIA, LTD
606	SARASOTA BENEVA PLACE ASSOICATES, LTD.
607	SCARBOROUGH ASSOCIATES
608	SCHOONER BAY I ASSOCIATES, L.P.
609	SCHOONER BAY I G.P. CORP.
610	SCHOONER BAY II ASSOCIATES, L.P.
611	SCHOONER BAY II G.P. CORP.
612	SECOND COUNRTY CLUB ASSOCIATES LIMITED PARTNERSHIP
613	SECOND GEORGIAN WOODS LIMITED PARTNERSHIP
614	SECOND TOWNE CENTRE LP
615	SHANNON WOODS APTS OF UNION CITY, II, LTD
616	SHEFFIELD APARTMENTS, LLC
617	SLATE RUN APTS OF BEDFORD, LTD
618	SOUTH SHORE ASSOCIATES, L.P.
619	SOUTH SHORE G.P. CORP.
620	SPRING LAKE MANOR ASSOC, LTD
621	SPRINGTREE APTS, LTD
622	SQUAW PEAK CONDOMINIUM, LLC
623	SUGARTREE APTS, II, LTD
624	SUMMIT CENTER, LLC
625	SUMMIT PLACE, LLC
626	TANGLEWOOD APARTMENTS, LLC
627	THE CROSSINGS ASSOCIATES
628	THE FOUR LAKES CONDOMINIUM HOMES CONDOMINIUM
629	THE LANDINGS HOLDING COMPANY, LLC
630	THE LANDINGS URBAN RENEWAL COMPANY, LLC
631	THE WIMBERLY APARTMENT HOMES, LTD.
632	THIRD TOWNE CENTRE LIMITED PARTNERSHIP
633	THYMEWOOD APTS, LTD
634	TIERRA ANTIGUA ASSOCIATES, L.P.
635	TIERRA ANTIGUA G.P. CORP.
636	TOWERS AT PORTSIDE URBAN RENEWAL COMPANY, LLC
637	TOWNHOUSE APARTMENT ASSOC, LTD
638	TWIN GATES APARTMENT ASSOC, LTD
639	VENETIAN CONDOMINIUM, LLC
640	VERONA CONDOMINIUM, LLC
641	WADLINGTON INVESTMENTS GENERAL PARTNERSHIP
642	WADLINGTON, INC.
643	WATERFIELD SQUARE I ASSOCIATES, L.P.
644	WATERFIELD SQUARE I G.P. CORP.
645	WATERFIELD SQUARE II ASSOCIATES, L.P.
646	WATERFIELD SQUARE II G.P. CORP.
647	WATERMARKE ASSOCIATES
648	WHARF HOLDING, LLC
649	WHRP, INC.
650	WILLOW BROOK ASSOCIATES, L.P.
651	WILLOW BROOK G.P. CORP.
652	WILLOW CREEK COMMUNITY RENTALS, L.P.
653	WILLOW CREEK G.P. CORP.
654	WILL-O-WISP ASSOC, LP
655	WILLOWOOD APTS OF TROTWOOD, LTD
656	WILLOWOOD EAST APTS OF INDIANAPOLIS, LTD
657	WINDRUSH APTS, LTD
658	WINDSOR PLACE, LLC
659	WINTER PARK ASSOC, LP
660	WINTER WOODS APTS, II, LTD
661	WINTHROP COURT APTS OF COLUMBUS, LTD
662	WOOD FOREST ASSOCIATES
663	WOODCREST (AUGUSTA), LLC
664	WYNNFIELD APARTMENTS, LLC

EX-23.1

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 and No. 333-88237; and Forms S-4 No. 333-44576 and No. 333-35873) of Equity Residential and in the related Prospectuses of our reports dated February 28, 2005, 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, 2004.

/s/ Ernst & Young LLP

Ernst & Young LLP

Chicago, Illinois

March 14, 2005

EX-24.1

Exhibit 24.1

POWER OF ATTORNEY

STATE OF ILLINOIS

COUNTY OF COOK

KNOW ALL MEN BY THESE PRESENTS that John W. Alexander, having an address at 255 COLVILLE RD., CHARLOTTE, N.C. 28207 has made, constituted and appointed and BY THESE PRESENTS, does make, constitute and appoint Bruce W. Duncan and Michael J. McHugh, or either of them, having an address at Two North Riverside Plaza, Chicago, Illinois 60606, his true and lawful Attorney-in-Fact for him and his name, place and stead to sign and execute in any and all capacities this Annual Report on Form 10-K and any or all amendments to this Annual Report granting unto each of such, Attorney-in-Fact, full power and authority to do and perform each and every act and thing, requisite and necessary to be done in and about the premises, as fully, to all intents and purposes as he might or could do if personally present at the doing thereof, with full power of substitution and revocation, hereby ratifying and confirming all that each of such Attorney-in-Fact or his substitutes shall lawfully do or cause to be done by virtue hereof.

This Power of Attorney shall remain in full force and effect until terminated by the undersigned through the instrumentality of a signed writing.

IN WITNESS WHEREOF, John W. Alexander, has hereunto set his hand this 9^th day of March, 2005.

/s/	John W. Alexander
	John W. Alexander

I, Leslie A. Foley, a Notary Public in and for said County in the State of aforesaid, do hereby certify that John W. Alexander, personally known to me to be the same person whose name is subscribed to the foregoing instrument appeared before me this day in person and acknowledged that he signed and delivered said instrument as his own free voluntary act for the uses and purposes therein set forth.

Given under my hand and notarial seal this 9^th day of March, 2005.

/s/	Leslie A. Foley
	(Notary Public)

My Commission Expires:   7/25/05

EX-24.2

Exhibit 24.2

POWER OF ATTORNEY

STATE OF ARIZONA

COUNTY OF MARICOPA

KNOW ALL MEN BY THESE PRESENTS that Stephen O. Evans, having an address at 5825 E. STARLIGHT WAY PARADISE VLY, AZ, has made, constituted and appointed and BY THESE PRESENTS, does make, constitute and appoint Bruce W. Duncan and Michael J. McHugh, or either of them, having an address at Two North Riverside Plaza, Chicago, Illinois 60606, his true and lawful Attorney-in-Fact for him and his name, place and stead to sign and execute in any and all capacities this Annual Report on Form 10-K and any or all amendments to this Annual Report granting unto each of such, Attorney-in-Fact, full power and authority to do and perform each and every act and thing, requisite and necessary to be done in and about the premises, as fully, to all intents and purposes as he might or could do if personally present at the doing thereof, with full power of substitution and revocation, hereby ratifying and confirming all that each of such Attorney-in-Fact or his substitutes shall lawfully do or cause to be done by virtue hereof.

This Power of Attorney shall remain in full force and effect until terminated by the undersigned through the instrumentality of a signed writing.

IN WITNESS WHEREOF, Stephen O. Evans, has hereunto set his hand this 1^st day of March, 2005.

/s/ Stephen O. Evans

 Stephen O. Evans

I, Nedup March, a Notary Public in and for said County in the State of aforesaid, do hereby certify that Stephen O. Evans, personally known to me to be the same person whose name is subscribed to the foregoing instrument appeared before me this day in person and acknowledged that he signed and delivered said instrument as his own free voluntary act for the uses and purposes therein set forth.

Given under my hand and notarial seal this 1^st day of March, 2005.

/s/ Nedup March

(Notary Public)

My Commission Expires: 7/23/07

EX-24.3

Exhibit 24.3

POWER OF ATTORNEY

STATE OF NEVADA

COUNTY OF CLARK

KNOW ALL MEN BY THESE PRESENTS that Charles L. Atwood, having an address at                                                                                                        , has made, constituted and appointed and BY THESE PRESENTS, does make, constitute and appoint Bruce W. Duncan and Michael J. McHugh, or either of them, having an address at Two North Riverside Plaza, Chicago, Illinois 60606, his true and lawful Attorney-in-Fact for him and his name, place and stead to sign and execute in any and all capacities this Annual Report on Form 10-K and any or all amendments to this Annual Report granting unto each of such, Attorney-in-Fact, full power and authority to do and perform each and every act and thing, requisite and necessary to be done in and about the premises, as fully, to all intents and purposes as he might or could do if personally present at the doing thereof, with full power of substitution and revocation, hereby ratifying and confirming all that each of such Attorney-in-Fact or his substitutes shall lawfully do or cause to be done by virtue hereof.

This Power of Attorney shall remain in full force and effect until terminated by the undersigned through the instrumentality of a signed writing.

IN WITNESS WHEREOF, Charles L. Atwood, has hereunto set his hand this 7^th day of March, 2005.

/s/	Charles L. Atwood
	Charles L. Atwood

I, Shirley W. Ramsey, a Notary Public in and for said County in the State of aforesaid, do hereby certify that Charles L. Atwood, personally known to me to be the same person whose name is subscribed to the foregoing instrument appeared before me this day in person and acknowledged that he signed and delivered said instrument as his own free voluntary act for the uses and purposes therein set forth.

Given under my hand and notarial seal this 7^th day of March, 2005.

/s/	Shirley W. Ramsey
	(Notary Public)

My Commission Expires:   8/26/07

EX-24.4

Exhibit 24.4

POWER OF ATTORNEY

STATE OF ILLINOIS

COUNTY OF COOK

KNOW ALL MEN BY THESE PRESENTS that Desiree G. Rogers, having an address at 1301 N. ASTOR ST., has made, constituted and appointed and BY THESE PRESENTS, does make, constitute and appoint Bruce W. Duncan and Michael J. McHugh, or either of them, having an address at Two North Riverside Plaza, Chicago, Illinois 60606, her true and lawful Attorney-in-Fact for her and her name, place and stead to sign and execute in any and all capacities this Annual Report on Form 10-K and any or all amendments to this Annual Report granting unto each of such, Attorney-in-Fact, full power and authority to do and perform each and every act and thing, requisite and necessary to be done in and about the premises, as fully, to all intents and purposes as she might or could do if personally present at the doing thereof, with full power of substitution and revocation, hereby ratifying and confirming all that each of such Attorney-in-Fact or his substitutes shall lawfully do or cause to be done by virtue hereof.

This Power of Attorney shall remain in full force and effect until terminated by the undersigned through the instrumentality of a signed writing.

IN WITNESS WHEREOF, Desiree G. Rogers, has hereunto set her hand this 7^th day of March, 2005.

/s/	Desiree G. Rogers
	Desiree G. Rogers

I, Suzanna Nowaczyk, a Notary Public in and for said County in the State of aforesaid, do hereby certify that Desiree G. Rogers, personally known to me to be the same person whose name is subscribed to the foregoing instrument appeared before me this day in person and acknowledged that she signed and delivered said instrument as her own free voluntary act for the uses and purposes therein set forth.

Given under my hand and notarial seal this 7^th day of March, 2005.

/s/	Suzanna Nowaczyk
	(Notary Public)

My Commission Expires:   2/29/08

EX-24.5

Exhibit 24.5

POWER OF ATTORNEY

STATE OF ILLINOIS

COUNTY OF CHAMPAIGN

KNOW ALL MEN BY THESE PRESENTS that B. Joseph White, having an address at 711 W. FLORIDA AVE., URBANA, IL 61801, has made, constituted and appointed and BY THESE PRESENTS, does make, constitute and appoint Bruce W. Duncan and Michael J. McHugh, or either of them, having an address at Two North Riverside Plaza, Chicago, Illinois 60606, his true and lawful Attorney-in-Fact for him and his name, place and stead to sign and execute in any and all capacities this Annual Report on Form 10-K and any or all amendments to this Annual Report granting unto each of such, Attorney-in-Fact, full power and authority to do and perform each and every act and thing, requisite and necessary to be done in and about the premises, as fully, to all intents and purposes as he might or could do if personally present at the doing thereof, with full power of substitution and revocation, hereby ratifying and confirming all that each of such Attorney-in-Fact or his substitutes shall lawfully do or cause to be done by virtue hereof.

This Power of Attorney shall remain in full force and effect until terminated by the undersigned through the instrumentality of a signed writing.

IN WITNESS WHEREOF, B. Joseph White, has hereunto set his hand this 4^th day of March, 2005.

/s/ B. Joseph White

 B. Joseph White

I, Susan J. Bailey, a Notary Public in and for said County in the State of aforesaid, do hereby certify that B. Joseph White, personally known to me to be the same person whose name is subscribed to the foregoing instrument appeared before me this day in person and acknowledged that he signed and delivered said instrument as his own free voluntary act for the uses and purposes therein set forth.

Given under my hand and notarial seal this 4^th day of March, 2005.

/s/ Susan J. Bailey

(Notary Public)

My Commission Expires: 7/15/2006

EX-24.6

Exhibit 24.6

POWER OF ATTORNEY

STATE OF ILLINOIS

COUNTY OF COOK

KNOW ALL MEN BY THESE PRESENTS that Sheli Z. Rosenberg, having an address at 2 N. RIVERSIDE PLAZA CHGO IL 60606, has made, constituted and appointed and BY THESE PRESENTS, does make, constitute and appoint Bruce W. Duncan and Michael J. McHugh, or either of them, having an address at Two North Riverside Plaza, Chicago, Illinois 60606, her true and lawful Attorney-in-Fact for her and her name, place and stead to sign and execute in any and all capacities this Annual Report on Form 10-K and any or all amendments to this Annual Report granting unto each of such, Attorney-in-Fact, full power and authority to do and perform each and every act and thing, requisite and necessary to be done in and about the premises, as fully, to all intents and purposes as she might or could do if personally present at the doing thereof, with full power of substitution and revocation, hereby ratifying and confirming all that each of such Attorney-in-Fact or his substitutes shall lawfully do or cause to be done by virtue hereof.

This Power of Attorney shall remain in full force and effect until terminated by the undersigned through the instrumentality of a signed writing.

IN WITNESS WHEREOF, Sheli Z. Rosenberg, has hereunto set her hand this 8^th day of March, 2005.

/s/	Sheli Z. Rosenberg
	Sheli Z. Rosenberg

I, Leslie A. Foley, a Notary Public in and for said County in the State of aforesaid, do hereby certify that Sheli Z. Rosenberg, personally known to me to be the same person whose name is subscribed to the foregoing instrument appeared before me this day in person and acknowledged that she signed and delivered said instrument as her own free voluntary act for the uses and purposes therein set forth.

Given under my hand and notarial seal this 8^th day of March, 2005.

/s/	Leslie A. Foley
	(Notary Public)

My Commission Expires:   7/25/05

EX-24.7

Exhibit 24.7

POWER OF ATTORNEY

STATE OF ILLINOIS

COUNTY OF COOK

KNOW ALL MEN BY THESE PRESENTS that James D. Harper, Jr., having an address at 2 N RIVERSIDE PLAZA CHGO, IL 60606, has made, constituted and appointed and BY THESE PRESENTS, does make, constitute and appoint Bruce W. Duncan and Michael J. McHugh, or either of them, having an address at Two North Riverside Plaza, Chicago, Illinois 60606, his true and lawful Attorney-in-Fact for him and his name, place and stead to sign and execute in any and all capacities this Annual Report on Form 10-K and any or all amendments to this Annual Report granting unto each of such, Attorney-in-Fact, full power and authority to do and perform each and every act and thing, requisite and necessary to be done in and about the premises, as fully, to all intents and purposes as he might or could do if personally present at the doing thereof, with full power of substitution and revocation, hereby ratifying and confirming all that each of such Attorney-in-Fact or his substitutes shall lawfully do or cause to be done by virtue hereof.

This Power of Attorney shall remain in full force and effect until terminated by the undersigned through the instrumentality of a signed writing.

IN WITNESS WHEREOF, James D. Harper, Jr., has hereunto set his hand this 4^th day of March, 2005.

/s/ James D. Harper, Jr.

 James D. Harper, Jr.

I, Leslie A. Foley, a Notary Public in and for said County in the State of aforesaid, do hereby certify that James D. Harper, Jr., personally known to me to be the same person whose name is subscribed to the foregoing instrument appeared before me this day in person and acknowledged that he signed and delivered said instrument as his own free voluntary act for the uses and purposes therein set forth.

Given under my hand and notarial seal this 4^th day of March, 2005.

/s/ Leslie A. Foley

(Notary Public)

My Commission Expires: 7/25/05

EX-24.8

Exhibit 24.8

POWER OF ATTORNEY

STATE OF GEORGIA

COUNTY OF GLASCOCK

KNOW ALL MEN BY THESE PRESENTS that Boone A. Knox, having an address at 3133 Washington Rd. NW, Thomson, GA 30824, has made, constituted and appointed and BY THESE PRESENTS, does make, constitute and appoint Bruce W. Duncan and Michael J. McHugh, or either of them, having an address at Two North Riverside Plaza, Chicago, Illinois 60606, his true and lawful Attorney-in-Fact for him and his name, place and stead to sign and execute in any and all capacities this Annual Report on Form 10-K and any or all amendments to this Annual Report granting unto each of such, Attorney-in-Fact, full power and authority to do and perform each and every act and thing, requisite and necessary to be done in and about the premises, as fully, to all intents and purposes as he might or could do if personally present at the doing thereof, with full power of substitution and revocation, hereby ratifying and confirming all that each of such Attorney-in-Fact or his substitutes shall lawfully do or cause to be done by virtue hereof.

This Power of Attorney shall remain in full force and effect until terminated by the undersigned through the instrumentality of a signed writing.

IN WITNESS WHEREOF, Boone A. Knox, has hereunto set his hand this 2^nd day of March, 2005.

/s/ Boone A. Knox

 Boone A. Knox

I, Barbara A. Crutchfield, a Notary Public in and for said County in the State of aforesaid, do hereby certify that Boone A. Knox, personally known to me to be the same person whose name is subscribed to the foregoing instrument appeared before me this day in person and acknowledged that he signed and delivered said instrument as his own free voluntary act for the uses and purposes therein set forth.

Given under my hand and notarial seal this 2^nd day of March, 2005.

/s/ Barbara A. Crutchfield

(Notary Public)

My Commission Expires: 6/16/07

EX-24.9

Exhibit 24.9

POWER OF ATTORNEY

STATE OF ILLINOIS

COUNTY OF COOK

KNOW ALL MEN BY THESE PRESENTS that Samuel Zell, having an address at TWO NORTH RIVERSIDE PLAZA, CHICAGO, IL 60606, has made, constituted and appointed and BY THESE PRESENTS, does make, constitute and appoint Bruce W. Duncan and Michael J. McHugh, or either of them, having an address at Two North Riverside Plaza, Chicago, Illinois 60606, his true and lawful Attorney-in-Fact for him and his name, place and stead to sign and execute in any and all capacities this Annual Report on Form 10-K and any or all amendments to this Annual Report granting unto each of such, Attorney-in-Fact, full power and authority to do and perform each and every act and thing, requisite and necessary to be done in and about the premises, as fully, to all intents and purposes as he might or could do if personally present at the doing thereof, with full power of substitution and revocation, hereby ratifying and confirming all that each of such Attorney-in-Fact or his substitutes shall lawfully do or cause to be done by virtue hereof.

This Power of Attorney shall remain in full force and effect until terminated by the undersigned through the instrumentality of a signed writing.

IN WITNESS WHEREOF, Samuel Zell, has hereunto set his hand this 9^th day of March, 2005.

/s/	Samuel Zell
	Samuel Zell

I, Hui Hwa Nam, a Notary Public in and for said County in the State of aforesaid, do hereby certify that Samuel Zell, personally known to me to be the same person whose name is subscribed to the foregoing instrument appeared before me this day in person and acknowledged that he signed and delivered said instrument as his own free voluntary act for the uses and purposes therein set forth.

Given under my hand and notarial seal this 9^th day of March, 2005.

/s/	Hui Hwa Nam
	(Notary Public)

My Commission Expires:   3/29/07

EX-24.10

Exhibit 24.10

POWER OF ATTORNEY

STATE OF ILLINOIS

COUNTY OF COOK

KNOW ALL MEN BY THESE PRESENTS that Gerald A. Spector, having an address at  TWO N. RIVERSIDE PLAZA   #400 CHGO IL 60606, has made, constituted and appointed and BY THESE PRESENTS, does make, constitute and appoint Bruce W. Duncan and Michael J. McHugh, or either of them, having an address at Two North Riverside Plaza, Chicago, Illinois 60606, his true and lawful Attorney-in-Fact for him and his name, place and stead to sign and execute in any and all capacities this Annual Report on Form 10-K and any or all amendments to this Annual Report granting unto each of such, Attorney-in-Fact, full power and authority to do and perform each and every act and thing, requisite and necessary to be done in and about the premises, as fully, to all intents and purposes as he might or could do if personally present at the doing thereof, with full power of substitution and revocation, hereby ratifying and confirming all that each of such Attorney-in-Fact or his substitutes shall lawfully do or cause to be done by virtue hereof.

This Power of Attorney shall remain in full force and effect until terminated by the undersigned through the instrumentality of a signed writing.

IN WITNESS WHEREOF, Gerald A. Spector, has hereunto set his hand this 1^st day of March, 2005.

/s/ Gerald A. Spector

 Gerald A. Spector

I, Leslie A Foley, a Notary Public in and for said County in the State of aforesaid, do hereby certify that Gerald A. Spector, personally known to me to be the same person whose name is subscribed to the foregoing instrument appeared before me this day in person and acknowledged that he signed and delivered said instrument as his own free voluntary act for the uses and purposes therein set forth.

Given under my hand and notarial seal this 1^st day of March, 2005.

/s/ Leslie A Foley

(Notary Public)

My Commission Expires: 7/25/05

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Bruce W. Duncan, 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: March 14, 2005
	/s/	Bruce W. Duncan
		Bruce W. Duncan
		Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATIONS

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.

Date: March 14, 2005
	/s/	Donna Brandin
		Donna Brandin
		Chief Financial Officer

EX-32.1

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, 2004 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Bruce W. Duncan, 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.

/s/	Bruce W. Duncan
Bruce W. Duncan
Chief Executive Officer
March 14, 2005

EX-32.2

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, 2004 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.

/s/	Donna Brandin
Donna Brandin
Chief Financial Officer
March 14, 2005