8-K

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

FORM 8-K

CURRENT REPORT Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934

 Date of Report (Date of Earliest Event Reported): August 28, 2007

ERP OPERATING LIMITED PARTNERSHIP

(Exact Name of Registrant as Specified in its Charter)

Illinois	0-24920	36-3894853
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification No.)
Two North Riverside Plaza Chicago, Illinois	60606
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (312) 474-1300

Not applicable
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 8.01 Other Events

ERP Operating Limited Partnership (the “Operating Partnership”) is re-issuing in an updated format its historical financial statements to satisfy SEC requirements as they relate to Statement of Financial Accounting Standards (“SFAS”) No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets.

In compliance with the provisions of SFAS No. 144, the results of operations of the Operating Partnership’s consolidated properties that were sold during the first six months of 2007 were reported as a component of discontinued operations for each period presented (including the comparable period of the prior year) in the Operating Partnership’s second quarter 2007 quarterly report on Form 10-Q filed with the SEC on August 7, 2007.  Under SEC requirements, the same reclassification as discontinued operations is required for previously issued annual financial statements for each of the three years shown in the Operating Partnership’s most recent annual report on Form 10-K, if those financial statements are incorporated by reference in subsequent filings with the SEC made under the Securities Act of 1933, as amended, even though those financial statements relate to periods prior to the sale date.

The aforementioned reclassification has no effect on the Operating Partnership’s previously reported net income available to OP Units or funds from operations (“FFO”).

This report on Form 8-K updates Items 6, 7, 8 and 15 (Exhibit 12 only) of the Operating Partnership’s annual report on Form 10-K for the year ended December 31, 2006 to reclassify those properties sold during the first six months of 2007 as a component of discontinued operations for each period presented in the annual report.  Exhibit 12 also reflects certain interim information for the six months ended June 30, 2007 and 2006.  All other items of the Operating Partnership’s Form 10-K remain unchanged.  No attempt has been made to update matters in the Form 10-K except to the extent expressly provided above.

ITEM 9.01 Financial Statements and Exhibits

Exhibit Number	Exhibit
12	Computation of Ratio of Earnings to Combined Fixed Charges
23.1	Consent of Independent Registered Public Accounting Firm
99.1	Form 10-K, Item 6. Selected Financial Data Form 10-K, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations Form 10-K, Item 8. Financial Statements and Supplementary Data

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	ERP OPERATING LIMITED PARTNERSHIP By: EQUITY RESIDENTIAL
		ITS GENERAL PARTNER
Date: August 28, 2007	By:		/s/ Donna Brandin
	Name:		Donna Brandin
	Its:		Executive Vice President and Chief Financial Officer
Date: August 28, 2007	By:		/s/ Ian S. Kaufman
	Name:		Ian S. Kaufman
	Its:		First Vice President and Chief Accounting Officer

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EXHIBIT INDEX

Exhibit Number	Exhibit
12	Computation of Ratio of Earnings to Combined Fixed Charges
23.1	Consent of Independent Registered Public Accounting Firm
99.1	Form 10-K, Item 6. Selected Financial Data Form 10-K, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations Form 10-K, Item 8. Financial Statements and Supplementary Data

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EX-12

Exhibit 12

ERP OPERATING LIMITED PARTNERSHIP
Computation of Ratio of Earnings to Combined Fixed Charges

	Six Months Ended June 30,						Year Ended December 31,
	2007			2006			2006			2005			2004			2003			2002
Income from continuing operations	$	49,199		$	49,795		$	86,699		$	151,743		$	96,756		$	104,814		$	108,268
Interest expense incurred, net	233,075			203,862			420,894			355,262			299,340			282,358			276,898
Amortization of deferred financing costs	6,162			4,383			8,140			6,391			5,711			5,096			5,176
Earnings before combined fixed charges and preferred distributions	288,436			258,040			515,733			513,396			401,807			392,268			390,342
Preference Unit distributions	(14,840		)	(20,168		)	(37,113		)	(49,642		)	(53,746		)	(76,435		)	(76,615		)
Premium on redemption of Preference Units	—			—			(3,965		)	(4,359		)	—			(20,237		)	—
Preference Interest and Junior Preference Unit distributions	(434		)	(1,556		)	(2,002		)	(7,606		)	(19,490		)	(20,536		)	(20,536		)
Premium on redemption of Preference Interests	—			(683		)	(684		)	(4,134		)	(1,117		)	—			—
Earnings before combined fixed charges	$	273,162		$	235,633		$	471,969		$	447,655		$	327,454		$	275,060		$	293,191
Interest expense incurred, net	$	233,075		$	203,862		$	420,894		$	355,262		$	299,340		$	282,358		$	276,898
Amortization of deferred financing costs	6,162			4,383			8,140			6,391			5,711			5,096			5,176
Interest capitalized for real estate and unconsolidated entities under development	17,894			7,780			20,734			13,701			13,969			20,647			27,167
Total combined fixed charges	257,131			216,025			449,768			375,354			319,020			308,101			309,241
Preference Unit distributions	14,840			20,168			37,113			49,642			53,746			76,435			76,615
Premium on redemption of Preference Units	—			—			3,965			4,359			—			20,237			—
Preference Interest and Junior Preference Unit distributions	434			1,556			2,002			7,606			19,490			20,536			20,536
Premium on redemption of Preference Interests	—			683			684			4,134			1,117			—			—
Total combined fixed charges and preferred distributions	$	272,405		$	238,432		$	493,532		$	441,095		$	393,373		$	425,309		$	406,392
Ratio of earnings before combined fixed charges to total combined fixed charges (1)	1.06			1.09			1.05			1.19			1.03			—			—
Ratio of earnings before combined fixed charges and preferred distributions to total combined fixed charges and preferred distributions (1)	1.06			1.08			1.04			1.16			1.02			—			—

(1) For 2003 and 2002, the coverage deficiencies on both ratios approximated $33.0 million and $16.1 million, respectively. All ratios have been reduced due to the disposition of properties which resulted in the inclusion of those properties in discontinued operations for all periods presented. For 2003, the ratios have been further reduced due to the one-time $20.2 million premium on the redemption of the Series G Preference Units.

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EX-23.1

Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the Registration Statements (Form S-3 No. 333-135504 and Forms S-4 No. 333-44576 and No. 333-36053) of ERP Operating Limited Partnership and in the related Prospectuses of our report dated February 21, 2007 (except for Notes 12, 13 and 20, as to which the date is August 27, 2007), with respect to the consolidated financial statements and schedule of ERP Operating Limited Partnership, included in this Current Report on Form 8-K.

/s/ Ernst & Young LLP

Ernst & Young LLP

Chicago, Illinois

August 27, 2007

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EX-99.1

Exhibit 99.1

Item 6.    Selected Financial Data

The following table sets forth selected financial and operating information on a historical basis for the Operating Partnership. The following information should be read in conjunction with all of the financial statements and notes thereto included elsewhere in this Form 8-K. The historical operating and balance sheet data have been derived from the historical financial statements of the Operating Partnership. Certain 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.

CONSOLIDATED HISTORICAL FINANCIAL INFORMATION

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

	Year Ended December 31,
	2006			2005			2004			2003			2002
OPERATING DATA:
Total revenues from continuing operations	$	1,897,398		$	1,599,701		$	1,411,098		$	1,245,755		$	1,219,333
Interest and other income	$	30,995		$	68,381		$	8,710		$	15,564		$	13,870
Income from continuing operations	$	86,699		$	151,743		$	96,756		$	104,814		$	108,268
Discontinued operations, net	$	1,061,405		$	780,304		$	427,408		$	473,691		$	339,907
Net income	$	1,148,104		$	932,047		$	524,164		$	578,505		$	448,175
Net income available to OP Units	$	1,104,340		$	866,306		$	449,811		$	461,297		$	351,024
Earnings per OP Unit – basic: Income (loss) from continuing
operations available to OP Units	$	0.14		$	0.28		$	0.07		$	(0.04	)	$	0.04
Net income available to OP Units	$	3.56		$	2.83		$	1.50		$	1.57		$	1.19
Weighted average OP Units outstanding	310,452			306,579			300,683			294,523			294,637
Earnings per OP Unit – diluted: Income (loss) from continuing
operations available to OP Units	$	0.14		$	0.28		$	0.07		$	(0.04	)	$	0.04
Net income available to OP Units	$	3.50		$	2.79		$	1.48		$	1.57		$	1.18
Weighted average OP Units outstanding	315,579			310,785			303,871			294,523			297,969
Distributions declared per OP Unit outstanding	$	1.79		$	1.74		$	1.73		$	1.73		$	1.73
BALANCE SHEET DATA (at end of period):
Real estate, before accumulated depreciation	$	17,235,175		$	16,590,370		$	14,852,621		$	12,874,379		$	13,046,263
Real estate, after accumulated depreciation	$	14,212,695		$	13,702,230		$	12,252,794		$	10,578,366		$	10,934,246
Total assets	$	15,062,219		$	14,108,751		$	12,656,306		$	11,477,917		$	11,822,005
Total debt	$	8,057,656		$	7,591,073		$	6,459,806		$	5,360,489		$	5,523,699
Minority Interests	$	26,814		$	16,965		$	9,557		$	9,903		$	9,811
Partners’ capital	$	6,268,867		$	5,800,558		$	5,598,553		$	5,606,467		$	5,798,615
OTHER DATA:
Total properties (at end of period)	617			926			939			968			1,039
Total apartment units (at end of period)	165,716			197,404			200,149			207,506			223,591
Funds from operations available to OP Units – basic (1) (2)	$	716,143		$	784,625		$	651,741		$	640,390		$	719,265
Cash flow provided by (used for):
Operating activities	$	755,466		$	698,531		$	707,061		$	744,319		$	888,263
Investing activities	$	(259,472	)	$	(592,201	)	$	(555,279	)	$	334,028		$	(48,622	)
Financing activities	$	(324,545	)	$	(101,007	)	$	(117,856	)	$	(1,058,643	)	$	(861,369	)

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(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 Operating Partnership commences the conversion of units to condominiums, it simultaneously discontinues depreciation of such property. FFO available to OP Units is calculated on a basis consistent with net income available to OP Units and reflects adjustments to net income for preferred distributions and premiums on redemption of preference units/interests in accordance with accounting principles generally accepted in the United States.

(2)The Operating Partnership believes that FFO and FFO available to OP Units are helpful to investors as supplemental measures of the operating performance of a real estate company, because they are recognized measures 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 and FFO available to OP Units can help compare the operating performance of a company’s real estate between periods or as compared to different companies. FFO and FFO available to OP Units do not represent net income, net income available to OP Units or net cash flows from operating activities in accordance with GAAP. Therefore, FFO and FFO available to OP Units should not be exclusively considered as alternatives to net income, net income available to OP Units or net cash flows from operating activities as determined by GAAP or as measures of liquidity. The Operating Partnership’s calculation of FFO and FFO available to OP Units 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 Operating Partnership should be read in connection with the Consolidated Financial Statements and Notes thereto. Due to the Operating Partnership’s ability to control its subsidiaries other than entities owning interests in the Partially Owned Properties — Unconsolidated and certain other entities in which it has investments, each such subsidiary entity has been consolidated with the Operating Partnership for financial reporting purposes. Capitalized terms used herein and not defined are as defined elsewhere in the Annual Report on Form 10-K for the year ended December 31, 2006.

Forward-looking statements in this Item 7 as well as elsewhere in the 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 statements are based on current expectations, estimates, projections and assumptions made by management. While the Operating Partnership’s management believes the assumptions underlying its forward-looking statements are reasonable, such information is inherently subject to uncertainties and may involve certain risks, which could cause actual results, performance, or achievements of the Operating Partnership to differ materially from anticipated future results, performance or achievements expressed or implied by such forward-looking statements. Many of these uncertainties and risks are difficult to predict and beyond management’s control. Forward-looking statements are not guarantees of future performance, results or events. The Operating Partnership assumes no obligation to update or supplement forward-looking statements because of subsequent events. Factors that might cause such differences include, but are not limited to, the following:

•We intend to actively acquire and develop multifamily properties for rental operations and/or conversion into condominiums, as well as upgrade and sell existing properties as individual condominiums. We may underestimate the costs necessary to bring an acquired or development property up to standards established for its intended market position. Additionally, we expect that other major real estate investors with significant capital will compete with us for attractive investment opportunities or may also develop properties in markets where we focus our development efforts. This competition may increase prices for multifamily properties or decrease the price at which we expect to sell individual properties. We may not be in a position

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or have the opportunity in the future to make suitable property acquisitions on favorable terms. We also plan to develop more properties ourselves in addition to co-investing with our development partners for either the rental or condominium market, depending on opportunities in each sub-market. This may increase the overall level of risk associated with our developments. The total number of development units, cost of development and estimated completion dates are subject to uncertainties arising from changing economic conditions (such as the cost of labor and construction materials), competition and local government regulation.

•Sources of capital to the Operating Partnership 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 Operating Partnership’s control; and

•Additional factors as discussed in Part I of the 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 Operating Partnership undertakes no obligation to publicly release any revisions to these forward-looking statements, which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Forward-looking statements and related uncertainties are also included in Notes 5 and 11 to the Notes to Consolidated Financial Statements in this report.

Results of Operations

In conjunction with our business objectives and operating strategy, the Operating Partnership has continued to invest or recycle its capital investment in apartment properties located in strategically targeted markets during the years ended December 31, 2006 and December 31, 2005. In summary, we:

Year Ended December 31, 2006:

•Acquired $1.8 billion of apartment properties consisting of 35 properties and 8,768 units, and $134.4 million of land parcels, all of which we deem to be in our strategic targeted markets; and

•Sold $2.3 billion of apartment properties consisting of 335 properties and 39,608 units, as well as 1,069 condominium units for $216.0 million and $1.6 million of land parcels.

Year Ended December 31, 2005:

•Acquired $2.5 billion of apartment properties consisting of 41 properties and 12,059 units, and $138.3 million of land parcels, all of which we deem to be in our strategic targeted markets; and

•Sold $1.4 billion of apartment properties consisting of 50 properties and 12,848 units, as well as 2,241 condominium units for $593.3 million and five land parcels for $108.3 million.

On June 28, 2006, the Operating Partnership announced that it agreed to sell its Lexford Housing Division for a cash purchase price of $1.086 billion. The sale closed on October 5, 2006. The Lexford Housing Division results are classified as discontinued operations, net in the consolidated statements of operations for all periods presented. The Operating Partnership recorded a gain on sale of approximately $418.7 million on the sale of the Lexford Housing Division in the fourth quarter of 2006. In conjunction with the Lexford disposition, the Operating Partnership paid off/extinguished $196.3 million of mortgage notes payable secured by the properties and incurred approximately $9.2 million in prepayment penalties upon extinguishment.

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The Operating Partnership’s primary financial measure for evaluating each of its apartment communities is net operating income (“NOI”). NOI represents rental income less property and maintenance expense, real estate tax and insurance expense, and property management expense. The Operating Partnership 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 Operating Partnership’s apartment communities.

Properties that the Operating Partnership owned for all of both 2006 and 2005 (the “2006 Same Store Properties”), which represented 128,133 units, impacted the Operating Partnership’s results of operations. Properties that the Operating Partnership owned for all of both 2005 and 2004 (the “2005 Same Store Properties”), which represented 154,854 units, also impacted the Operating Partnership’s results of operations. Both the 2006 Same Store Properties and 2005 Same Store Properties are discussed in the following paragraphs.

The Operating Partnership’s acquisition, disposition, completed development and consolidation of previously unconsolidated property and variable interest entity activities also impacted overall results of operations for the years ended December 31, 2006 and 2005. The impacts of these activities are also discussed in greater detail in the following paragraphs.

Comparison of the year ended December 31, 2006 to the year ended December 31, 2005

For the year ended December 31, 2006, income from continuing operations decreased by approximately $65.0 million when compared to the year ended December 31, 2005. The decrease in continuing operations is discussed below.

Revenues from the 2006 Same Store Properties increased $88.7 million primarily as a result of higher rental rates charged to residents. Expenses from the 2006 Same Store Properties increased $23.9 million primarily due to higher maintenance, payroll, utility costs and real estate taxes. The following tables provide comparative same store results and statistics for the 2006 Same Store Properties:

2006 vs. 2005
Year over Year Same-Store Results/Statistics (1)

$ in Thousands (except for Average Rental Rate) – 128,133 Same-Store Units

	Results									Statistics
Description	Revenues			Expenses			NOI			Average Rental Rate (2)			Occupancy		Turnover
2006	$	1,612,529		$	628,210		$	984,319		$	1,110		94.6	%	(64.6	)%
2005	$	1,523,858		$	604,318		$	919,540		$	1,050		94.6	%	(65.5	)%
Change	$	88,671		$	23,892		$	64,779		$	60		0.0	%	0.9	%
Change	5.8		%	4.0		%	7.0		%	5.7		%

(1) Results have not been updated to remove properties sold in the first six months of 2007.

(2) Average rental rate is defined as total rental revenues divided by the weighted average occupied units for the period.

The following table presents a reconciliation of operating income per the consolidated statements of operations included in the original Form 10-K to NOI for the 2006 Same Store Properties (table has not been updated to reflect discontinued operations treatment for properties sold in the first six months of 2007).

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	Year Ended December 31,
	2006			2005
	(Amounts in thousands)
Operating income	$	513,143		$	433,464
Adjustments:
Non-same-store operating results	(173,863		)	(22,851		)
Fee and asset management revenue	(9,101		)	(10,240		)
Fee and asset management expense	8,934			8,555
Depreciation	562,739			439,594
General and administrative	48,465			70,405
Impairment	34,002			613
Same store NOI	$	984,319		$	919,540

For properties that the Operating Partnership acquired prior to January 1, 2006 and expects to continue to own through December 31, 2007, the Operating Partnership anticipates the following same store results for the full year ending December 31, 2007:

2007 Same-Store Assumptions
Physical Occupancy	95.0%
Revenue Change	5.00% to 6.00%
Expense Change	3.50% to 4.50%
NOI Change	5.50% to 7.50%

These 2007 assumptions are based on current expectations and are forward-looking.

Non-same store operating results increased $151.0 million and consist primarily of properties acquired in calendar years 2006 and 2005 as well as our corporate housing business.

See also Note 20 in the Notes to Consolidated Financial Statements for additional discussion regarding the Operating Partnership’s segment disclosures.

Fee and asset management revenues, net of fee and asset management expenses decreased $1.5 million primarily as a result of lower income earned from managing fewer properties for third parties and unconsolidated entities. As of December 31, 2006 and 2005, the Operating Partnership managed 15,020 units and 16,269 units, respectively, for third parties and unconsolidated entities.

Property management expenses from continuing operations include off-site expenses associated with the self-management of the Operating Partnership’s properties as well as management fees paid to any third party management companies. These expenses increased by approximately $9.3 million or 10.7%. This increase is primarily attributable to higher overall payroll costs and higher overall computer and training costs specific to the Operating Partnership’s rollout of a new property management system.

Depreciation expense from continuing operations, which includes depreciation on non-real estate assets, increased $121.1 million primarily as a result of additional depreciation expense on newly acquired properties and capital expenditures for all properties owned.

General and administrative expenses, which include corporate operating expenses, decreased approximately $21.9 million between the periods under comparison. This decrease was primarily due to lower executive compensation expense due to severance costs for several EQR executive officers incurred

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during the year ended December 31, 2005 and a $2.8 million reimbursement of legal expenses during the year ended December 31, 2006. The Operating Partnership anticipates that general and administrative expenses will approximate $50.0 million to $52.0 million for the year ending December 31, 2007. The above assumption is based on current expectations and is forward-looking.

Impairment from continuing operations increased $33.4 million between periods under comparison. This increase was primarily due to an impairment charge on goodwill of $30.0 million related to the corporate housing business and $2.0 million related to the write-off of various deferred sales costs following the decision to halt the condominium conversion and sale process at five assets.

Interest and other income from continuing operations decreased by approximately $37.4 million, primarily as a result of the $57.1 million in cash received during the year ended December 31, 2005 for the Operating Partnership’s ownership interest in Rent.com, which was acquired by eBay, Inc. This was partially offset by the $3.7 million in additional proceeds for Rent.com, an increase in interest earned on tax deferred 1031 exchange proceeds from the Lexford disposition and $14.7 million of forfeited deposits for various terminated transactions received during the year ended December 31, 2006.

Interest expense from continuing operations, including amortization of deferred financing costs, increased approximately $67.4 million primarily as a result of higher variable interest rates and overall debt levels outstanding. During the year ended December 31, 2006, the Operating Partnership capitalized interest costs of approximately $20.7 million as compared to $13.7 million for the year ended December 31, 2005. This capitalization of interest primarily relates to consolidated projects under development. The effective interest cost on all indebtedness for the year ended December 31, 2006 was 6.21% as compared to 6.16% for the year ended December 31, 2005.

Loss from investments in unconsolidated entities increased approximately $1.1 million between the periods under comparison. This increase is primarily the result of consolidating previously unconsolidated properties as of January 1, 2006 as the result of EITF Issue No. 04-5. See Note 4 in the Notes to Consolidated Financial Statements for further discussion.

Net gain on sales of unconsolidated entities decreased $1.0 million, due to increased unconsolidated sales during the year ended December 31, 2005.

Net gain on sales of land parcels decreased $27.5 million, due to a large gain recorded on the sale of one land parcel during the year ended December 31, 2005.

Discontinued operations, net increased approximately $281.1 million between the periods under comparison. This increase is primarily the result of lower real estate net book values for properties sold during the year ended December 31, 2006 as compared to the same period in 2005. See Note 13 in the Notes to Consolidated Financial Statements for further discussion.

Comparison of the year ended December 31, 2005 to the year ended December 31, 2004

For the year ended December 31, 2005, income from continuing operations increased by approximately $55.0 million when compared to the year ended December 31, 2004. The increase in continuing operations is discussed below.

Revenues from the 2005 Same Store Properties increased $61.9 million primarily as a result of lower concessions provided residents and a slight increase in average occupancy rates. Expenses from the 2005 Same Store Properties increased $36.2 million primarily due to higher payroll, utility costs and real estate taxes. The following tables provide comparative revenue, expense, NOI and weighted average occupancy for the 2005 Same Store Properties:

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2005 vs. 2004

Year over Year Same-Store Results

$ in Thousands – 154,854 Same-Store Units

Description	Revenues			Expenses (1)			NOI
2005	$	1,636,753		$	678,199		$	958,554
2004	$	1,574,843		$	641,980		$	932,863
Change	$	61,910		$	36,219		$	25,691
Change	3.9		%	5.6		%	2.8		%

(1)Year 2005 expenses exclude $11.1 million of uninsured property damage caused by Hurricane Wilma. Year 2004 expenses exclude $15.2 million of uninsured property damage caused by Hurricanes Charley, Frances, Ivan and Jeanne.

Same-Store Occupancy Statistics
Year 2005	94.1	%
Year 2004	93.5	%
Change	0.6	%

Non-same store operating results increased $78.6 million and consist primarily of properties acquired in calendar years 2005 and 2004 as well as our corporate housing business.

Fee and asset management revenues, net of fee and asset management expenses, decreased by $1.5 million primarily as a result of lower income earned from Ft. Lewis and managing fewer properties for third parties and unconsolidated entities. As of December 31, 2005 and 2004, the Operating Partnership managed 16,269 units and 17,988 units, respectively, for third parties and unconsolidated entities.

Property management expenses from continuing operations include off-site expenses associated with the self-management of the Operating Partnership’s properties as well as management fees paid to any third party management companies. These expenses increased by approximately $10.3 million or 13.4%. This increase is primarily attributable to higher overall payroll costs including bonuses, long-term compensation costs and an increase of the Operating Partnership’s match for employee 401(k) contributions.

Depreciation expense from continuing operations, which includes depreciation on non-real estate assets, increased $58.2 million primarily as a result of additional depreciation expense on newly acquired properties and capital expenditures for all properties owned.

General and administrative expenses, which include corporate operating expenses, increased approximately $23.3 million between the periods under comparison. This increase was primarily due to higher executive compensation expense due to severance costs of $9.8 million for several EQR executive officers, $7.9 million of additional accruals specific to performance shares for selected EQR executive officers and a $2.5 million profit sharing accrual paid in the first quarter of 2006.

Interest and other income from continuing operations increased approximately $59.7 million, primarily as a result of the $57.1 million in cash received for the Operating Partnership’s ownership interest in Rent.com, which was acquired by eBay, Inc.

Interest expense from continuing operations, including amortization of deferred financing costs, increased approximately $56.6 million primarily as a result of higher overall debt balances as well as higher

13

variable interest rates. During the year ended December 31, 2005, the Operating Partnership capitalized interest costs of approximately $13.7 million as compared to $14.0 million for the year ended December 31, 2004. This capitalization of interest primarily relates to consolidated projects under development. The effective interest cost on all indebtedness for the year ended December 31, 2005 was 6.16% as compared to 5.87% for the year ended December 31, 2004.

(Loss) income from investments in unconsolidated entities increased approximately $7.8 million between the periods under comparison. This increase is primarily the result of consolidation of properties that were previously unconsolidated in the first quarter of 2004.

Net gain on sales of unconsolidated entities decreased $3.3 million, primarily due to a decrease in the number of unconsolidated entities sold.

Net gain on sales of land parcels increased $24.8 million, primarily due to an increase in the number of land parcels sold and large gains recorded on two land parcels located in Tyson’s Corner, Virginia.

Discontinued operations, net increased approximately $352.9 million between the periods under comparison. This increase is primarily the result of higher per unit sales prices and lower real estate net book values for properties sold during the year ended December 31, 2005 as compared to the same period in 2004 as well as higher condominium sales. The Operating Partnership recognized $91.6 million and $32.1 million of net incremental gain on sales of condominium units (net of provision for income taxes) for the years ended December 31, 2005 and 2004, respectively.

Liquidity and Capital Resources

For the Year Ended December 31, 2006

As of January 1, 2006, the Operating Partnership had approximately $88.8 million of cash and cash equivalents and $780.8 million available under its line of credit (net of $50.2 million which was restricted/dedicated to 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 Operating Partnership’s cash and cash equivalents balance at December 31, 2006 was approximately $260.3 million and the amount available on the Operating Partnership’s revolving credit facilities was $470.7 million (net of $69.3 million which was restricted/dedicated to support letters of credit and not available for borrowing).

During the year ended December 31, 2006, the Operating Partnership generated proceeds from various transactions, which included the following:

•Disposed of 340 properties, various individual condominium units and two land parcels, receiving net proceeds of approximately $2.3 billion;

•Obtained $395.5 million in net proceeds from the issuance of $400.0 million of ten and one-half year 5.375% fixed rate public notes and terminated six forward starting swaps designated to hedge the note issuance, receiving net proceeds of $10.7 million;

•Obtained $637.0 million in net proceeds from the issuance of $650.0 million of twenty year 3.85% exchangeable fixed rate public notes;

•Obtained $267.0 million in new mortgage financing; and

•Issued approximately 2.9 million OP Units and received net proceeds of $77.7 million.

During the year ended December 31, 2006, the above proceeds were primarily utilized to:

•Invest $291.3 million primarily in development projects;

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•Acquire 35 properties and nine land parcels, utilizing cash of $1.7 billion;

•Repurchase 1.9 million OP Units utilizing cash of $83.2 million;

•Repay $493.0 million of mortgage loans;

•Repay $60.0 million of fixed rate public notes;

•Redeem the series G Preference Interests at a liquidation value of $25.5 million; and

•Redeem the Series C Preference Units at a liquidation value of $115.0 million.

Depending on its analysis of market prices, economic conditions, and other opportunities for the investment of available capital, the Company may repurchase its Common Shares pursuant to its existing share buyback program authorized by the Board of Trustees. EQR repurchased $83.2 million (1,897,912 shares at an average price per share of $43.85) of its Common Shares during the year ended December 31, 2006 to offset the issuance of 1,144,326 OP Units to limited partners in connection with three property acquisitions and to partially offset EQR restricted shares granted and ESPP shares purchased during the year ended December 31, 2006. Concurrent with this transaction, the Operating Partnership repurchased and retired 1,897,912 OP Units previously issued to EQR. EQR is authorized to repurchase approximately $501.8 million of additional Common Shares. The Operating Partnership in turn would repurchase $501.8 million of its OP Units held by EQR.

The Operating Partnership’s total debt summary and debt maturity schedules as of December 31, 2006, are as follows:

Debt Summary as of December 31, 2006

(Amounts in thousands)

	Amounts (1)		% of Total		Weighted Average Rates (1)		Weighted Average Maturities (years)
Secured	$	3,178,223	39.4	%	5.82	%	6.4
Unsecured	4,879,433		60.6	%	5.84	%	6.6
Total	$	8,057,656	100.0	%	5.83	%	6.5
Fixed Rate Debt:
Secured – Conventional	$	2,286,529	28.4	%	6.30	%	4.4
Secured – Tax Exempt	18,260		0.2	%	6.39	%	18.3
Unsecured – Public/Private	4,158,043		51.6	%	5.90	%	6.9
Unsecured – Tax Exempt	111,390		1.4	%	5.06	%	22.3
Fixed Rate Debt	6,574,222		81.6	%	6.04	%	6.3
Floating Rate Debt:
Secured – Conventional	338,278		4.2	%	6.31	%	2.4
Secured – Tax Exempt	535,156		6.6	%	3.45	%	17.4
Unsecured – Public	150,000		1.9	%	6.13	%	2.4
Unsecured – Revolving Credit Facilities	460,000		5.7	%	5.40	%	1.4
Floating Rate Debt	1,483,434		18.4	%	4.90	%	7.5
Total	$	8,057,656	100.0	%	5.83	%	6.5

(1) Net of the effect of any derivative instruments. Weighted average rates are for the year ended December 31, 2006.

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Debt Maturity Schedule as of December 31, 2006

(Amounts in thousands)

Year		Fixed Rate (1)		Floating Rate (1)		Total		% of Total		Weighted Average Rates on Fixed Rate Debt (1)		Weighted Average Rates on Total Debt (1)
2007		$	360,411	$	101,052	$	461,463	5.7	%	6.34	%	6.51	%
2008	(2)	520,499		489,335		1,009,834		12.5	%	6.71	%	6.17	%
2009		452,953		382,564		835,517		10.4	%	6.37	%	5.36	%
2010		279,323		—		279,323		3.5	%	7.05	%	7.05	%
2011	(3)	1,448,445		24,150		1,472,595		18.3	%	5.52	%	5.50	%
2012		558,396		—		558,396		6.9	%	6.48	%	6.48	%
2013		567,355		—		567,355		7.1	%	5.93	%	5.93	%
2014		504,141		34,460		538,601		6.7	%	5.27	%	5.26	%
2015		316,459		—		316,459		3.9	%	6.53	%	6.53	%
2016		1,089,170		—		1,089,170		13.5	%	5.32	%	5.32	%
2017+		477,070		451,873		928,943		11.5	%	6.70	%	5.88	%
Total		$	6,574,222	$	1,483,434	$	8,057,656	100.0	%	5.98	%	5.82	%

(1) Net of the effect of any derivative instruments. Weighted average rates are as of December 31, 2006.

(2) Includes $460.0 million outstanding on the Operating Partnership’s $1.0 billion unsecured revolving credit facility, which matures on May 29, 2008.

(3) Includes $650.0 million of 3.85% convertible unsecured debt with a final maturity of 2026. The notes are callable by the Operating Partnership on or after August 18, 2011. The notes are putable by the holders on August 18, 2011, August 15, 2016 and August 15, 2021.

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The following table provides a summary of the Operating Partnership’s unsecured debt as of December 31, 2006:

Unsecured Debt Summary as of December 31, 2006

(Amounts in thousands)

	Coupon Rate		Due Date		Face Amount		Unamortized Premium/ (Discount)		Net Balance
Fixed Rate Notes:
	7.625	%	04/15/07		$50,000		$51		$50,051
	6.900	%	08/01/07		50,000		(14	)	49,986
	7.540	%	09/01/07	(1)	4,286		—		4,286
	4.861	%	11/30/07		50,000		—		50,000
	7.500	%	08/15/08	(1)	130,000		—		130,000
	4.750	%	06/15/09	(2)	300,000		(674	)	299,326
	6.950	%	03/02/11		300,000		3,632		303,632
	6.625	%	03/15/12		400,000		(1,529	)	398,471
	5.200	%	04/01/13		400,000		(740	)	399,260
	5.250	%	09/15/14		500,000		(474	)	499,526
	6.584	%	04/13/15		300,000		(919	)	299,081
	5.125	%	03/15/16		500,000		(493	)	499,507
	5.375	%	08/01/16		400,000		(1,778	)	398,222
	7.125	%	10/15/17		150,000		(700	)	149,300
	7.570	%	08/15/26		140,000		—		140,000
	3.850	%	08/15/26	(3)	650,000		(7,990	)	642,010
Floating Rate Adjustments				(2)	(150,000	)	—		(150,000	)
FAS 133 Adjustments - net				(2)	(4,615	)	—		(4,615	)
					4,169,671		(11,628	)	4,158,043
Fixed Rate Tax Exempt Notes:
	4.750	%	12/15/28	(1)	35,600		—		35,600
	5.200	%	06/15/29	(1)	75,790		—		75,790
					111,390		—		111,390
Floating Rate Notes:			06/15/09	(2)	150,000		—		150,000
Revolving Credit Facilities:			05/29/08	(4)	460,000		—		460,000
Total Unsecured Debt					$4,891,061		$(11,628	)	$4,879,433

(1)	Notes are private. All other unsecured debt is public.
(2)	$150.0 million in fair value interest rate swaps converts 50% of the 4.750% Notes due June 15, 2009 to a floating interest rate.
(3)	Convertible notes mature on August 15, 2026. The notes are callable by the Operating Partnership on or after August 18, 2011. The notes are putable by the holders on August 18, 2011, August 15, 2016 and August 15, 2021.
(4)	Represents amount outstanding on the Operating Partnership’s $1.0 billion unsecured revolving credit facility.

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As of February 28, 2007, an unlimited amount of debt securities remains available for issuance by the Operating Partnership under a registration statement that became automatically effective upon filing with the SEC in June 2006 (under SEC regulations enacted in 2005, the registration statement automatically expires on June 29, 2009 and does not contain a maximum issuance amount) and $956.5 million in equity securities remains available for issuance by EQR under a registration statement the SEC declared effective in February 1998. Per the terms of ERPOP’s partnership agreement, EQR contributes the net proceeds of all equity offerings to the capital of the Operating Partnership in exchange for additional OP Units (on a one-for-one Common Share per OP Unit basis) or preference units (on a one-for-one preferred share per preference unit basis).

The Operating Partnership’s “Consolidated Debt-to-Total Market Capitalization Ratio” as of December 31, 2006 is presented in the following table. The Operating Partnership calculates the equity component of its market capitalization as the sum of (i) the total outstanding OP Units at the equivalent market value of the closing price of EQR’s Common Shares on the New York Stock Exchange; (ii) the “OP Unit Equivalent” of all convertible preference units/interests; and (iii) the liquidation value of all perpetual preference units outstanding.

Capital Structure as of December 31, 2006

(Amounts in thousands except for unit and per unit amounts)

Secured Debt			$	3,178,223	39.4	%
Unsecured Debt			4,419,433		54.9	%
Lines of Credit			460,000		5.7	%
Total Debt			$	8,057,656	100.0	%	33.0	%
OP Units	313,466,216
OP Unit Equivalents (see below)	856,602
Total outstanding at quarter-end	314,322,818
EQR Common Share Price at December 31, 2006	$	50.75
			$	15,951,883	97.7	%
Perpetual Preference Units (see below)			375,000		2.3	%
Total Equity			$	16,326,883	100.0	%	67.0	%
Total Market Capitalization			$	24,384,539			100.0	%

Convertible Preference Units/Interests as of December 31, 2006

(Amounts in thousands except for unit/interest and per unit/interest amounts)

Series	Redemption Date	Outstanding Units/Interests	Liquidation Value		Annual Dividend Per Unit/Interest		Annual Dividend Amount		Weighted Average Rate		Conversion Ratio	OP Unit Equivalents
Preference Units:
7.00% Series E	11/1/98	434,816	$	10,871	$	1.75	$	761			1.1128	483,863
7.00% Series H	6/30/98	28,134	703		1.75		49				1.4480	40,738
Preference Interests:
7.625% Series J	12/14/06	230,000	11,500		3.8125		877				1.4108	324,484
Junior Preference Units:
8.00% Series B	7/29/09	7,367	184		2.00		15				1.020408	7,517
Total Convertible Preference Units/Interests		700,317	$	23,258			$	1,702	7.32	%		856,602

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Perpetual Preference Units as of December 31, 2006

(Amounts in thousands except for unit and per unit amounts)

Series	Redemption Date	Outstanding Units	Liquidation Value		Annual Dividend Per Unit		Annual Dividend Amount		Weighted Average Rate
Preference Units:
8.60% Series D	7/15/07	700,000	$	175,000	$	21.50	$	15,050
8.29% Series K	12/10/26	1,000,000	50,000		4.145		4,145
6.48% Series N	6/19/08	600,000	150,000		16.20		9,720
Total Perpetual Preference Units		2,300,000	$	375,000			$	28,915	7.71	%

The Operating Partnership 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 revolving credit facilities. The Operating Partnership considers its cash provided by operating activities to be adequate to meet operating requirements and payments of distributions. The Operating Partnership 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 Operating Partnership 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 Operating Partnership must maintain in order to comply with covenants under its unsecured notes and line of credit. Of the $17.2 billion in investment in real estate on the Operating Partnership’s balance sheet at December 31, 2006, $11.6 billion or 67.0%, was unencumbered.

The Operating Partnership’s senior debt ratings from Standard & Poor (“S&P”), Moody’s and Fitch are A-, Baa1 (positive outlook) and A, respectively. EQR’s preferred equity ratings from S&P, Moody’s and Fitch are BBB+, Baa2 (positive outlook) and
A-, respectively.

The Operating Partnership has a long-term revolving credit facility with potential borrowings of up to $1.0 billion which matures in May 2008. This facility may, among other potential uses, be used to fund property acquisitions, costs for certain properties under development and short term liquidity requirements. As of February 26, 2007, $740.0 million was outstanding under this facility.

See Note 21 in the Notes to Consolidated Financial Statements for discussion of the events which occurred subsequent to December 31, 2006.

Capitalization of Fixed Assets and Improvements to Real Estate

Our policy with respect to capital expenditures is generally to capitalize expenditures that improve the value of the property or extend the useful life of the component asset of the property. We track improvements to real estate in two major categories and several subcategories:

•Replacements (inside the unit). These include:

•flooring such as carpets, hardwood, vinyl, linoleum or tile;

•appliances;

•mechanical equipment such as individual furnace/air units, hot water heaters, etc;

•furniture and fixtures such as kitchen/bath cabinets, light fixtures, ceiling fans, sinks, tubs, toilets, mirrors, countertops, etc; and

•blinds/shades.

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All replacements are depreciated over a five-year estimated useful life. We expense as incurred all make-ready maintenance and turnover costs such as cleaning, interior painting of individual units and the repair of any replacement item noted above.

•Building improvements (outside the unit). These include:

•roof replacement and major repairs;

•paving or major resurfacing of parking lots, curbs and sidewalks;

•amenities and common areas such as pools, exterior sports and playground equipment, lobbies, clubhouses, laundry rooms, alarm and security systems and offices;

•major building mechanical equipment systems;

•interior and exterior structural repair and exterior painting and siding;

•major landscaping and grounds improvement; and

•vehicles and office and maintenance equipment.

All building improvements are depreciated over a five to ten-year estimated useful life. We capitalize building improvements and upgrades only if the item: (i) exceeds $2,500 (selected projects must exceed $10,000); (ii) extends the useful life of the asset; and (iii) improves the value of the asset.

For the year ended December 31, 2006, our actual improvements to real estate totaled approximately $255.2 million. This includes the following (amounts in thousands except for unit and per unit amounts):

Capitalized Improvements to Real Estate

For the Year Ended December 31, 2006

	Total Units (1)	Replacements		Avg. Per Unit		Building Improvements		Avg. Per Unit		Total		Avg. Per Unit
Established Properties (2)	115,152	$	46,094	$	400	$	81,127	$	705	$	127,221	$	1,105
New Acquisition Properties (3)	29,512	9,194		336		35,854		1,311		45,048		1,647
Other (4)	6,651	30,384				52,527				82,911
Total	151,315	$	85,672			$	169,508			$	255,180

(1)Total units exclude 10,846 unconsolidated units and 3,555 military housing (fee managed) units.

(2)Wholly Owned Properties acquired prior to January 1, 2004.

(3)Wholly Owned Properties acquired during 2004, 2005 and 2006. Per unit amounts are based on a weighted average of 27,346 units.

(4)Includes properties either Partially Owned or sold during the period, commercial space, condominium conversions and $21.4 million included in building improvements spent on seventeen specific assets related to major renovations and repositioning of these assets.

For the year ended December 31, 2005, our actual improvements to real estate totaled approximately $232.5 million. This includes the following (amounts in thousands except for unit and per unit amounts):

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Capitalized Improvements to Real Estate

For the Year Ended December 31, 2005

	Total Units (1)	Replacements		Avg. Per Unit		Building Improvements		Avg. Per Unit		Total		Avg. Per Unit
Established Properties (2)	145,305	$	55,508	$	382	$	89,252	$	614	$	144,760	$	996
New Acquisition Properties (3)	27,669	5,626		270		19,508		937		25,134		1,207
Other (4)	8,531	23,421				39,185				62,606
Total	181,505	$	84,555			$	147,945			$	232,500

(1)Total units exclude 15,899 unconsolidated units.

(2)Wholly Owned Properties acquired prior to January 1, 2003.

(3)Wholly Owned Properties acquired during 2003, 2004 and 2005. Per unit amounts are based on a weighted average of 20,828 units.

(4)Includes properties either Partially Owned or sold during the period, commercial space, condominium conversions and $6.8 million included in building improvements spent on nine specific assets related to major renovations and repositioning of these assets.

The Operating Partnership expects to fund approximately $145.0 million for capital expenditures for replacements and building improvements for all consolidated properties, exclusive of condominium conversion properties, in 2007. This includes an average of approximately $1,000 per unit for capital improvements for established properties.

During the year ended December 31, 2006, the Operating Partnership’s total non-real estate capital additions, such as computer software, computer equipment, and furniture and fixtures and leasehold improvements to the Operating Partnership’s property management offices and its corporate offices, were approximately $10.7 million. The Operating Partnership expects to fund approximately $8.2 million in total additions to non-real estate property in 2007.

Improvements to real estate and additions to non-real estate property were funded from net cash provided by operating activities.

Derivative Instruments

In the normal course of business, the Operating Partnership is exposed to the effect of interest rate changes. The Operating Partnership 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 Operating Partnership 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 Operating Partnership has not sustained a material loss from those instruments nor does it anticipate any material adverse effect on its net income or financial position in the future from the use of derivatives.

See Note 11 in the Notes to Consolidated Financial Statements for additional discussion of derivative instruments at December 31, 2006.

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Other

Total distributions paid in January 2007 amounted to $152.4 million (excluding distributions on Partially Owned Properties), which included certain distributions declared during the fourth quarter ended December 31, 2006.

Off-Balance Sheet Arrangements and Contractual Obligations

The Operating Partnership 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 Operating Partnership’s liquidity, capital resources, credit or market risk than its property management and ownership activities. During 2000 and 2001, the Operating Partnership entered into institutional ventures with an unaffiliated partner. At the respective closing dates, the Operating Partnership sold and/or contributed 45 properties containing 10,846 units to these ventures and retained a 25% ownership interest in the ventures. The Operating Partnership’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 Operating Partnership. The Operating Partnership’s strategy with respect to these ventures was to reduce its concentration of properties in a variety of markets.

As of December 31, 2006, the Operating Partnership has 11 projects totaling 3,448 units in various stages of development with estimated completion dates ranging through June 30, 2009. The development agreements currently in place are discussed in detail in Note 18 of the Operating Partnership’s Consolidated Financial Statements.

See also Notes 2 and 6 in the Notes to Consolidated Financial Statements for additional discussion regarding the Operating Partnership’s investments in partially owned entities.

The following table summarizes the Operating Partnership’s contractual obligations for the next five years and thereafter as of December 31, 2006:

Payments Due by Year (in thousands)

Contractual Obligations	2007		2008		2009		2010		2011		Thereafter		Total
Debt (a)	$	461,463	$	1,009,834	$	835,517	$	279,323	$	1,472,595	$	3,998,924	$	8,057,656
Operating Leases:
Minimum Rent Payments (b)	5,443		5,302		4,709		4,119		2,416		2,963		24,952
Other Long-Term Liabilities:
Deferred Compensation (c)	813		813		1,450		1,450		2,049		14,736		21,311
Total	$	467,719	$	1,015,949	$	841,676	$	284,892	$	1,477,060	$	4,016,623	$	8,103,919

(a)Amounts include aggregate principal payments only. The Operating Partnership paid $465,388, $397,886 and $348,574 for interest on debt, inclusive of derivative instruments, for the years ended December 31, 2006, 2005 and 2004, respectively.

(b)Minimum basic rent due for various office space the Operating Partnership leases and fixed base rent due on a ground lease for one property.

(c)Estimated payments to EQR’s Chairman, two former CEO’s and its chief operating officer based on planned retirement dates.

Critical Accounting Policies and Estimates

The Operating Partnership’s significant accounting policies are described in Note 2 in the Notes to Consolidated Financial Statements. These policies were followed in preparing the consolidated financial statements at and for the year ended December 31, 2006 and are consistent with the year ended December 31, 2005.

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The Operating Partnership 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 Operating Partnership 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 Operating Partnership to conclude that impairment indicators exist and an impairment loss is warranted.

Depreciation of Investment in Real Estate

The Operating Partnership 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 Operating Partnership 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 Operating Partnership 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 Operating Partnership capitalizes interest, real estate taxes and insurance and payroll and associated costs for those individuals directly responsible for and who spend all of their time on development activities, with capitalization ceasing no later than 90 days following issuance of the certificate of occupancy. These costs are reflected on the balance sheet as construction in progress for each specific property. The Operating Partnership expenses as incurred all payroll costs of on-site employees working directly at our properties, except as noted above on our development properties prior to certificate of occupancy issuance and on specific major renovation at selected properties when additional incremental employees are hired.

Fair Value of Financial Instruments, Including Derivative Instruments

The valuation of financial instruments under SFAS No. 107 and SFAS No. 133 and its amendments (SFAS Nos. 137/138/149) requires the Operating Partnership to make estimates and judgments that affect the fair value of the instruments. The Operating Partnership, 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 Operating Partnership bases its estimates on current instruments with similar terms and maturities or on other factors relevant to the financial instruments.

23

Revenue Recognition

Rental income attributable to leases is recorded when due from residents and is recognized monthly as it is earned, which is not materially different than on a straight-line basis. Leases entered into between a resident and a property for the rental of an apartment unit are generally year-to-year, renewable upon consent of both parties on an annual or monthly basis. Fee and asset management revenue and interest income are recorded on an accrual basis.

Share-Based Compensation

The Company accounts for its share-based compensation in accordance with SFAS No. 123 (R), Share-Based Payment, effective January 1, 2006, which results in compensation expense being recorded based on the fair value of the share compensation granted.

Any Common Shares issued pursuant to EQR’s incentive equity compensation and employee share purchase plans will result in the Operating Partnership issuing OP Units to EQR on a one-for-one basis, with the Operating Partnership receiving the net cash proceeds of such issuances.

The Black-Scholes option valuation model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. This model is only one method of valuing options and the Company’s use of this model should not be interpreted as an endorsement of its accuracy. Because the Company’s share options have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management’s opinion, the existing models do not necessarily provide a reliable single measure of the fair value of its share options and the actual value of the options may be significantly different.

Funds From Operations

For the year ended December 31, 2006, Funds From Operations (“FFO”) available to OP Units decreased $68.5 million, or 8.7%, as compared to the year ended December 31, 2005. For the year ended December 31, 2005, FFO available to OP Units increased $132.9 million, or 20.4%, as compared to the year ended December 31, 2004.

24

The following is a reconciliation of net income to FFO available to OP Units for each of the five years ended December 31, 2006:

Funds From Operations
(Amounts in thousands)

	Year Ended December 31,
	2006			2005			2004			2003			2002
Net income	$	1,148,104		$	932,047		$	524,164		$	578,505		$	448,175
Adjustments:
Depreciation	538,763			417,708			359,533			304,111			284,656
Depreciation – Non-real estate additions	(7,840		)	(5,541		)	(5,303		)	(6,774		)	(9,029		)
Depreciation – Partially Owned and Unconsolidated Properties	4,338			2,487			1,903			19,911			12,166
Net gain on sales of unconsolidated entities	(370		)	(1,330		)	(4,593		)	(4,942		)	(5,054		)
Discontinued operations:
Depreciation	53,755			111,039			136,779			167,213			188,116
Net (gain) on sales of discontinued operations (3)	(1,022,643		)	(697,655		)	(318,443		)	(310,706		)	(104,296		)
Net incremental gain on sales of condominium units	45,800			91,611			32,054			10,280			1,682
FFO (1)(2)	759,907			850,366			726,094			757,598			816,416
Preferred distributions	(39,115		)	(57,248		)	(73,236		)	(96,971		)	(97,151		)
Premium on redemption of preference units/interests	(4,649		)	(8,493		)	(1,117		)	(20,237		)	—
FFO available to OP Units	$	716,143		$	784,625		$	651,741		$	640,390		$	719,265

(1)         The National Association of Real Estate Investment Trusts (“NAREIT”) defines funds from operations (“FFO”) (April 2002 White Paper) as net income (computed in accordance with accounting principles generally accepted in the United States (“GAAP”)), excluding gains (or losses) from sales of depreciable property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect funds from operations on the same basis. The April 2002 White Paper states that gain or loss on sales of property is excluded from FFO for previously depreciated operating properties only. Once the Operating Partnership commences the conversion of units to condominiums, it simultaneously discontinues depreciation of such property. FFO available to OP Units is calculated on a basis consistent with net income available to OP Units and reflects adjustments to net income for preferred distributions and premiums on redemption of preference units/interests in accordance with accounting principles generally accepted in the United States.

(2)         The Operating Partnership believes that FFO and FFO available to OP Units are helpful to investors as supplemental measures of the operating performance of a real estate company, because they are recognized measures 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 and FFO available to OP Units can help compare the operating performance of a company’s real estate between periods or as compared to different companies. FFO and FFO available to OP Units do not represent net income, net income available to OP Units or net cash flows from operating activities in accordance with GAAP. Therefore, FFO and FFO available to OP Units should not be exclusively considered as alternatives to net income, net income available to OP Units or net cash flows from operating activities as determined by GAAP or as measures of liquidity. The Operating Partnership’s calculation of FFO and FFO available to OP Units may differ from other real estate companies due to, among other items, variations in cost capitalization policies for capital expenditures and, accordingly, may not be comparable to such other real estate companies.

(3)         Net (gain) on sales of discontinued operations, has been reduced by approximately $4.5 million in one-time accrued retention benefits for the year ended December 31, 2006, related to the previously announced October 5, 2006 closing of the Lexford Housing Division disposition.

Item 8. Financial Statements and Supplementary Data

See Index to Consolidated Financial Statements on page F-1.

25

INDEX TO FINANCIAL STATEMENTS AND SCHEDULE

ERP OPERATING LIMITED PARTNERSHIP

		PAGE
FINANCIAL STATEMENTS FILED AS PART OF THIS REPORT
	Report of Independent Registered Public Accounting Firm	F-2
	Consolidated Balance Sheets as of December 31, 2006 and 2005	F-3
	Consolidated Statements of Operations for the years ended December 31, 2006, 2005 and 2004	F-4 to F-5
	Consolidated Statements of Cash Flows for the years ended December 31, 2006, 2005 and 2004	F-6 to F-8
	Consolidated Statements of Changes in Partners’ Capital for the years ended December 31, 2006, 2005 and 2004	F-9 to F-10
	Notes to Consolidated Financial Statements	F-11 to F-45
SCHEDULE FILED AS PART OF THIS REPORT
	Schedule III - Real Estate and Accumulated Depreciation	S-1 to S-11

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 Partners

ERP Operating Limited Partnership

We have audited the accompanying consolidated balance sheets of ERP Operating Limited Partnership (the “Operating Partnership”) as of December 31, 2006 and 2005 and the related consolidated statements of operations, changes in partners’ capital and cash flows for each of the three years in the period ended December 31, 2006. Our audits also included the financial statement schedule listed in the accompanying index to the financial statements and schedule. These financial statements and schedule are the responsibility of the Operating Partnership’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 ERP Operating Limited Partnership at December 31, 2006 and 2005, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2006, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the effectiveness of ERP Operating Limited Partnership’s internal control over financial reporting as of December 31, 2006, based on the criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 21, 2007 (not provided herein) expressed an unqualified opinion thereon.

	/s/ ERNST & YOUNG LLP
	ERNST & YOUNG LLP
Chicago, Illinois
February 21, 2007, except Notes 12, 13 and
20, as to which the date is August 27, 2007.

F-2

ERP OPERATING LIMITED PARTNERSHIP

CONSOLIDATED BALANCE SHEETS

(Amounts in thousands)

	December 31, 2006			December 31, 2005
ASSETS
Investment in real estate
Land	$	3,217,672		$	2,848,601
Depreciable property	13,376,359			13,336,636
Projects under development	386,917			240,980
Land held for development	254,227			164,153
Investment in real estate	17,235,175			16,590,370
Accumulated depreciation	(3,022,480		)	(2,888,140		)
Investment in real estate, net	14,212,695			13,702,230
Cash and cash equivalents	260,277			88,828
Investments in unconsolidated entities	4,448			6,838
Rents receivable	390			789
Deposits – restricted	391,825			77,093
Escrow deposits – mortgage	25,528			35,225
Deferred financing costs, net	43,384			40,636
Goodwill, net	—			30,000
Other assets	123,672			127,112
Total assets	$	15,062,219		$	14,108,751
LIABILITIES AND PARTNERS’ CAPITAL
Liabilities:
Mortgage notes payable	$	3,178,223		$	3,379,289
Notes, net	4,419,433			3,442,784
Lines of credit	460,000			769,000
Accounts payable and accrued expenses	100,605			115,543
Accrued interest payable	91,172			78,441
Rents received in advance and other liabilities	307,651			305,536
Security deposits	58,072			54,823
Distributions payable	151,382			145,812
Total liabilities	8,766,538			8,291,228
Commitments and contingencies
Minority Interests – Partially Owned Properties	26,814			16,965
Partners’ capital:
Preference Units	386,574			504,096
Preference Interests and Junior Preference Units	11,684			60,184
General Partner	5,511,658			4,905,716
Limited Partners	372,961			345,034
Accumulated other comprehensive loss	(14,010		)	(14,472		)
Total partners’ capital	6,268,867			5,800,558
Total liabilities and partners’ capital	$	15,062,219		$	14,108,751

See accompanying notes

F-3

ERP OPERATING LIMITED PARTNERSHIP

CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands except per OP Unit data)

	Year Ended December 31,
	2006			2005			2004
REVENUES
Rental income	$	1,888,297		$	1,589,461		$	1,400,355
Fee and asset management	9,101			10,240			10,743
Total revenues	1,897,398			1,599,701			1,411,098
EXPENSES
Property and maintenance	500,074			424,858			367,371
Real estate taxes and insurance	185,651			178,527			162,787
Property management	96,178			86,873			76,615
Fee and asset management	8,934			8,555			7,572
Depreciation	538,763			417,708			359,533
General and administrative	48,457			70,398			47,122
Impairment	34,002			613			1,538
Total expenses	1,412,059			1,187,532			1,022,538
Operating income	485,339			412,169			388,560
Interest and other income	30,995			68,381			8,710
Interest:
Expense incurred, net	(420,894		)	(355,262		)	(299,340		)
Amortization of deferred financing costs	(8,140		)	(6,391		)	(5,711		)
Income before allocation to Minority Interests, (loss) income from investments in unconsolidated entities, net gain on sales of unconsolidated entities and land parcels and discontinued operations	87,300			118,897			92,219
Allocation to Minority Interests – Partially Owned Properties	(3,132		)	801			1,787
(Loss) income from investments in unconsolidated entities	(631		)	470			(7,325		)
Net gain on sales of unconsolidated entities	370			1,330			4,593
Net gain on sales of land parcels	2,792			30,245			5,482
Income from continuing operations	86,699			151,743			96,756
Discontinued operations, net	1,061,405			780,304			427,408
Net income	$	1,148,104		$	932,047		$	524,164
ALLOCATION OF NET INCOME:
Preference Units	$	37,113		$	49,642		$	53,746
Preference Interests and Junior Preference Units	$	2,002		$	7,606		$	19,490
Premium on redemption of Preference Units	$	3,965		$	4,359		$	—
Premium on redemption of Preference Interests	$	684		$	4,134		$	1,117
General Partner	$	1,031,766		$	807,792		$	418,583
Limited Partners	72,574			58,514			31,228
Net income available to OP Units	$	1,104,340		$	866,306		$	449,811
Earnings per OP Unit – basic:
Income from continuing operations available to OP Units	$	0.14		$	0.28		$	0.07
Net income available to OP Units	$	3.56		$	2.83		$	1.50
Weighted average OP Units outstanding	310,452			306,579			300,683
Earnings per OP Unit – diluted:
Income from continuing operations available to OP Units	$	0.14		$	0.28		$	0.07
Net income available to OP Units	$	3.50		$	2.79		$	1.48
Weighted average OP Units outstanding	315,579			310,785			303,871
Distributions declared per OP Unit outstanding	$	1.79		$	1.74		$	1.73

See accompanying notes

F-4

ERP OPERATING LIMITED PARTNERSHIP

CONSOLIDATED STATEMENTS OF OPERATIONS (Continued)

(Amounts in thousands except per OP Unit data)

	Year Ended December 31,
	2006			2005		2004
Comprehensive income:
Net income	$	1,148,104		$	932,047	$	524,164
Other comprehensive income (loss) – derivative and other instruments:
Unrealized holding (losses) gains arising during the year	(1,785		)	4,357		(3,707		)
Equity in unrealized holding gains arising during the year – unconsolidated entities	—			—		3,667
Losses reclassified into earnings from other comprehensive income	2,247			2,541		2,071
Comprehensive income	$	1,148,566		$	938,945	$	526,195

See accompanying notes

F-5

ERP OPERATING LIMITED PARTNERSHIP

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

	Year Ended December 31,
	2006			2005			2004
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	1,148,104		$	932,047		$	524,164
Adjustments to reconcile net income to net cash provided by operating activities:
Allocation to Minority Interests – Partially Owned Properties	3,132			(801		)	(1,787		)
Depreciation	592,637			528,958			496,583
Amortization of deferred financing costs	9,134			7,166			7,276
Amortization of discounts and premiums on debt	(6,506		)	(3,502		)	(784		)
Amortization of deferred settlements on derivative instruments	841			1,160			1,001
Impairment	34,353			613			1,538
(Income) from technology investments	(4,021		)	(57,054		)	—
Loss (income) from investments in unconsolidated entities	631			(470		)	7,325
Distributions from unconsolidated entities – return on capital	171			—			—
Net (gain) on sales of unconsolidated entities	(370		)	(1,330		)	(4,593		)
Net (gain) on sales of land parcels	(2,792		)	(30,245		)	(5,482		)
Net (gain) on sales of discontinued operations	(1,016,443		)	(697,655		)	(318,443		)
Loss on debt extinguishments	12,171			10,977			113
Unrealized loss on derivative instruments	7			10			249
Compensation paid with Company Common Shares	22,080			35,905			16,826
Other operating activities, net	555			(279		)	(1,432		)
Changes in assets and liabilities:
Decrease (increase) in rents receivable	406			918			(628		)
Decrease (increase) in deposits – restricted	2,225			5,829			(6,037		)
Decrease (increase) in other assets	569			(21,553		)	(20,633		)
(Decrease) in accounts payable and accrued expenses	(10,797		)	(10,400		)	(8,214		)
Increase in accrued interest payable	17,192			8,171			9,176
(Decrease) increase in rents received in advance and other liabilities	(50,727		)	(15,203		)	8,032
Increase in security deposits	2,914			5,269			2,811
Net cash provided by operating activities	755,466			698,531			707,061
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in real estate – acquisitions	(1,718,105		)	(2,229,881		)	(820,029		)
Investment in real estate – development/other	(291,338		)	(164,202		)	(107,251		)
Improvements to real estate	(255,180		)	(232,500		)	(212,171		)
Additions to non-real estate property	(10,652		)	(17,610		)	(6,552		)
Interest capitalized for real estate under development	(20,734		)	(13,701		)	(11,687		)
Interest capitalized for unconsolidated entities under development	—			—			(2,282		)
Proceeds from disposition of real estate, net	2,318,247			1,978,087			937,690
Proceeds from disposition of unconsolidated entities	373			3,533			7,940
Proceeds from technology investments	4,021			82,054			—
Investments in unconsolidated entities	(1,072		)	(1,480		)	(406,524		)
Distributions from unconsolidated entities – return of capital	92			3,194			26,553
(Increase) decrease in deposits on real estate acquisitions, net	(296,589		)	(706		)	58,715
Decrease in mortgage deposits	10,098			683			9,144

See accompanying notes

F-6

ERP OPERATING LIMITED PARTNERSHIP

CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(Amounts in thousands)

	Year Ended December 31,
	2006			2005			2004
CASH FLOWS FROM INVESTING ACTIVITIES (continued):
Consolidation of previously Unconsolidated Properties:
Via acquisition (net of cash acquired)	$	—		$	(62	)	$	(49,183	)
Via EITF 04-5/FIN 46 (cash consolidated)	1,436			—			3,628
Acquisition of Minority Interests – Partially Owned Properties	(71		)	(1,989		)	(72		)
Other investing activities, net	2			2,379			16,802
Net cash (used for) investing activities	(259,472		)	(592,201		)	(555,279		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Loan and bond acquisition costs	(11,662		)	(12,816		)	(9,696		)
Mortgage notes payable:
Proceeds	267,045			280,125			467,541
Restricted cash	(20,193		)	—			—
Lump sum payoffs	(466,035		)	(442,786		)	(469,333		)
Scheduled principal repayments	(26,967		)	(27,607		)	(25,607		)
Prepayment premiums/fees	(12,171		)	(10,977		)	(450		)
Notes, net:
Proceeds	1,039,927			499,435			898,014
Lump sum payoffs	(60,000		)	(190,000		)	(531,390		)
Scheduled principal repayments	(4,286		)	(4,286		)	(4,286		)
Lines of credit:
Proceeds	6,417,500			6,291,300			1,742,000
Repayments	(6,726,500		)	(5,672,300		)	(1,602,000		)
Proceeds from (payments on) settlement of derivative instruments	10,722			(7,823		)	(7,346		)
Proceeds from sale of OP Units	7,972			8,285			6,853
Proceeds from exercise of EQR options	69,726			54,858			79,043
OP Units repurchased and retired	(83,230		)	—			—
Redemption of Preference Units	(115,000		)	(125,000		)	—
Redemption of Preference Interests	(25,500		)	(146,000		)	(40,000		)
Premium on redemption of Preference Units	(27		)	(43		)	—
Premium on redemption of Preference Interests	(10		)	(322		)	—
Payment of offering costs	(125		)	(26		)	(24		)
Contributions – Minority Interests – Partially Owned Properties	9,582			7,439			100
Distributions:
OP Units – General Partner	(514,055		)	(496,004		)	(484,540		)
Preference Units	(39,344		)	(51,092		)	(54,350		)
Preference Interests and Junior Preference Units	(2,054		)	(7,778		)	(19,612		)
OP Units – Limited Partners	(36,202		)	(35,833		)	(36,446		)
Minority Interests – Partially Owned Properties	(3,658		)	(11,756		)	(26,327		)
Net cash (used for) financing activities	(324,545		)	(101,007		)	(117,856		)
Net increase in cash and cash equivalents	171,449			5,323			33,926
Cash and cash equivalents, beginning of year	88,828			83,505			49,579
Cash and cash equivalents, end of year	$	260,277		$	88,828		$	83,505

See accompanying notes

F-7

ERP OPERATING LIMITED PARTNERSHIP

CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(Amounts in thousands)

	Year Ended December 31,
	2006			2005			2004
SUPPLEMENTAL INFORMATION:
Cash paid during the year for interest	$	465,388		$	397,886		$	348,574
Cash paid during the year for income, franchise and excise taxes	$	11,750		$	11,605		$	2,991
Real estate acquisitions/dispositions/other:
Mortgage loans assumed	$	126,988		$	443,478		$	95,901
Valuation of OP Units issued	$	49,591		$	33,662		$	9,087
Mortgage loans (assumed) by purchaser	$	(117,949	)	$	(35,031	)	$	(29,470	)
Consolidation of previously Unconsolidated Properties – Via acquisition:
Investment in real estate	$	—		$	(5,608	)	$	(960,331	)
Mortgage loans assumed	$	—		$	2,839		$	274,818
Minority Interests – Partially Owned Properties	$	—		$	59		$	445
Investments in unconsolidated entities	$	—		$	1,176		$	608,681
Net other liabilities recorded	$	—		$	1,472		$	27,204
Consolidation of previously Unconsolidated Properties – Via EITF 04-5/FIN 46:
Investment in real estate, net	$	(24,637	)	$	—		$	(548,342	)
Mortgage loans consolidated	$	22,545		$	—		$	294,722
Minority Interests – Partially Owned Properties	$	—		$	—		$	3,074
Investments in unconsolidated entities	$	2,602		$	—		$	234,984
Net other liabilities recorded	$	926		$	—		$	19,190
Refinancing of mortgage notes payable into notes, net	$	—		$	—		$	130,000

See accompanying notes

F-8

ERP OPERATING LIMITED PARTNERSHIP

CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS’ CAPITAL

(Amounts in thousands)

	Year Ended December 31,
	2006			2005			2004
PREFERENCE UNITS
Balance, beginning of year	$	504,096		$	636,216		$	670,913
Redemption of 9 1/8% Series B Cumulative Redeemable	—			(125,000		)	—
Redemption of 9 1/8% Series C Cumulative Redeemable	(115,000		)	—			—
Conversion of 7.00% Series E Cumulative Convertible	(2,357		)	(7,065		)	(34,519		)
Conversion of 7.00% Series H Cumulative Convertible	(165		)	(55		)	(178		)
Balance, end of year	$	386,574		$	504,096		$	636,216
PREFERENCE INTERESTS AND JUNIOR PREFERENCE UNITS
Balance, beginning of year	$	60,184		$	206,184		$	248,217
Conversion of Series A Junior Preference Units into OP Units	—			—			(2,033		)
Redemption of Series A-G Preference Interests	(25,500		)	(146,000		)	(40,000		)
Conversion of Series H and I Preference Interests into OP Units held by General Partner	(23,000		)	—			—
Balance, end of year	$	11,684		$	60,184		$	206,184
GENERAL PARTNER
Balance, beginning of year	$	4,905,716		$	4,457,700		$	4,371,483
OP Unit Issuance:
Conversion of Preference Units into OP Units held by General Partner	2,522			7,120			34,697
Conversion of Preference Interests into OP Units held by General Partner	23,000			—			—
Conversion of OP Units held by Limited Partners into OP Units held by General Partner	27,882			24,196			36,920
Exercise of EQR share options	69,726			54,858			79,043
EQR’s Employee Share Purchase Plan (ESPP)	7,972			8,285			6,853
Share-based employee compensation expense:
EQR performance shares	1,795			7,697			224
EQR restricted shares	14,944			20,037			8,794
EQR share options	5,198			6,562			2,982
EQR ESPP discount	1,578			1,591			1,290
OP Units repurchased and retired	(83,230		)	—			—
Offering costs	(125		)	(26		)	(24		)
Net income available to OP Units – General Partner	1,031,766			807,792			418,583
Premium on redemption of Preference Units – original issuance costs	3,938			4,316			—
Premium on redemption of Preference Interests – original issuance costs	674			3,812			1,117
OP Units – General Partner distributions	(521,871		)	(500,697		)	(488,040		)
Supplemental Executive Retirement Plan (SERP)	(9,947		)	(4,177		)	(8,705		)
Adjustment for Limited Partners ownership in Operating Partnership	30,120			6,650			(7,517		)
Balance, end of year	$	5,511,658		$	4,905,716		$	4,457,700

See accompanying notes

F-9

ERP OPERATING LIMITED PARTNERSHIP

CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS’ CAPITAL (Continued)

(Amounts in thousands)

	Year Ended December 31,
	2006			2005			2004
LIMITED PARTNERS
Balance, beginning of year	$	345,034		$	319,841		$	342,809
OP Unit Issuance:
Acquisitions/consolidations	49,591			33,662			9,087
Conversion of OP Units held by Limited Partners into OP Units held by General Partner	(27,882		)	(24,196		)	(36,920		)
Conversion of Junior Preference Units into OP Units held by Limited Partners	—			—			2,033
Net income available to OP Units – Limited Partners	72,574			58,514			31,228
OP Units – Limited Partners distributions	(36,236		)	(36,137		)	(35,913		)
Adjustment for Limited Partners ownership in Operating Partnership	(30,120		)	(6,650		)	7,517
Balance, end of year	$	372,961		$	345,034		$	319,841
DEFERRED COMPENSATION
Balance, beginning of year	$	—		$	(18	)	$	(3,554	)
Amortization to compensation expense:
EQR performance shares	—			—			88
EQR restricted shares	—			18			3,448
Balance, end of year	$	—		$	—		$	(18	)
ACCUMULATED OTHER COMPREHENSIVE LOSS
Balance, beginning of year	$	(14,472	)	$	(21,370	)	$	(23,401	)
Accumulated other comprehensive income (loss) – derivative and other instruments:
Unrealized holding (losses) gains arising during the year	(1,785		)	4,357			(3,707		)
Equity in unrealized holding gains arising during the year – unconsolidated entities	—			—			3,667
Losses reclassified into earnings from other comprehensive income	2,247			2,541			2,071
Balance, end of year	$	(14,010	)	$	(14,472	)	$	(21,370	)

See accompanying notes

F-10

ERP OPERATING LIMITED PARTNERSHIP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.Business

ERP Operating Limited Partnership (“ERPOP”), an Illinois limited partnership, was formed in May 1993 to conduct the multifamily residential property business of Equity Residential (“EQR”). EQR, a Maryland real estate investment trust (“REIT”) formed in March 1993, is an S&P 500 company focused on the acquisition, development and management of high quality apartment properties in top United States growth markets. EQR has elected to be taxed as a REIT.

EQR is the general partner of, and as of December 31, 2006 owned an approximate 93.6% ownership interest in, ERPOP. EQR is structured as an umbrella partnership REIT (“UPREIT”), under which all property ownership and business operations are conducted through ERPOP and its subsidiaries. References to the “Operating Partnership” include ERPOP and those entities owned or controlled by it. References to the “Company” mean EQR and the Operating Partnership.

As of December 31, 2006, the Operating Partnership, directly or indirectly through investments in title holding entities, owned all or a portion of 617 properties in 25 states and the District of Columbia consisting of 165,716 units. The ownership breakdown includes (table does not include various uncompleted development properties):

	Properties	Units
Wholly Owned Properties	546	146,442
Partially Owned Properties:
Consolidated	25	4,873
Unconsolidated	45	10,846
Military Housing (Fee Managed)	1	3,555
	617	165,716

The “Wholly Owned Properties” are accounted for under the consolidation method of accounting. The Operating Partnership beneficially owns 100% fee simple title to 545 of the 546 Wholly Owned Properties. The Operating Partnership owns the building and improvements and leases the land underlying the improvements under a long-term ground lease that expires in 2026 for one property. This one property is consolidated and reflected as a real estate asset while the ground lease is accounted for as an operating lease in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 13, Accounting for Leases.

The “Partially Owned Properties - Consolidated” are controlled by the Operating Partnership but have partners with minority interests and are accounted for under the consolidation method of accounting. The “Partially Owned Properties - Unconsolidated” are partially owned but not controlled by the Operating Partnership and consist of investments in partnership interests and/or subordinated mortgages that are accounted for under the equity method of accounting. The “Military Housing (Fee Managed)” property consists of an investment in a limited liability company that, as a result of the terms of the operating agreement, is accounted for as a management contract right with all fees recognized as fee and asset management revenue.

2.Summary of Significant Accounting Policies

Basis of Presentation

Due to the Operating Partnership’s ability as general partner to control either through ownership or by contract its subsidiaries, other than entities that own controlling interests in the

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Partially Owned Properties - Unconsolidated and certain other entities in which the Operating Partnership has investments, each such subsidiary has been consolidated with the Operating Partnership for financial reporting purposes. Effective March 31, 2004, the consolidated financial statements also include all variable interest entities for which the Operating Partnership is the primary beneficiary.

Minority interests represented by EQR’s indirect 1% interest in various entities are immaterial and have not been accounted for in the Consolidated Financial Statements. In addition, certain amounts due from EQR for its 1% interests in various entities have not been reflected in the Consolidated Balance Sheets since such amounts are immaterial.

The Operating Partnership’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 Operating Partnership 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 Operating Partnership 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 Operating Partnership 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 Operating Partnership 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 Operating Partnership allocates the purchase price of acquired real estate to various components as follows:

•Land – Based on actual purchase price if acquired separately or market research/comparables if acquired with an operating property.

•Furniture, Fixtures and Equipment – Ranges between $8,000 and $13,000 per apartment unit acquired as an estimate of the fair value of the appliances & fixtures inside a unit. The per-unit amount applied depends on the type of apartment building acquired. Depreciation is calculated on the straight-line method over an estimated useful life of five years.

•In-Place Leases – The Operating Partnership 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 Operating Partnership considers whether it has acquired other intangible assets that meet the definition outlined in SFAS No. 141, paragraph 39, including any customer relationship intangibles. The amortization period is the estimated useful life of the acquired intangible asset.

•Building – Based on the fair value determined on an “as-if vacant” basis. Depreciation is calculated on the straight-line method over an estimated useful life of thirty years.

Replacements inside a unit such as appliances and carpeting are depreciated over a five-year estimated useful life. Expenditures for ordinary maintenance and repairs are expensed to operations as incurred and significant renovations and improvements that improve and/or extend the useful life of the asset are capitalized over their estimated useful life, generally five to ten years. Initial direct leasing costs are expensed as incurred as such expense approximates the deferral and amortization of initial direct leasing costs over the lease terms. Property sales or dispositions are recorded when title transfers to unrelated third parties, contingencies have been removed and sufficient cash consideration has been

F-12

received by the Operating Partnership. 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 Operating Partnership 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 Operating Partnership classifies properties under development and/or expansion and properties in the lease up phase (including land) as construction in progress until construction has been completed and all certificates of occupancy permits have been obtained.

Impairment of Long-Lived Assets, Including Goodwill

In June 2001, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 142, Goodwill and Other Intangible Assets. SFAS No. 142 prohibits the amortization of goodwill and requires that goodwill be reviewed for impairment at least annually. In August 2001, the FASB issued SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. SFAS Nos. 142 and 144 were effective for fiscal years beginning after December 15, 2001. The Operating Partnership adopted these standards effective January 1, 2002. See Notes 13 and 19 for further discussion.

The Operating Partnership 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 Operating Partnership to conclude that impairment indicators exist and an impairment loss is warranted.

For long-lived assets to be held and used, the Operating Partnership 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 Operating Partnership 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 Operating Partnership 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 Operating Partnership 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 Operating Partnership 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 Operating Partnership 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 Operating Partnership capitalizes interest, real estate taxes and insurance and payroll and associated costs for those individuals directly responsible for and who spend all of their time on development activities, with capitalization ceasing no later than 90 days following issuance of the certificate of occupancy. These

F-13

costs are reflected on the balance sheet as construction in progress for each specific property. The Operating Partnership expenses as incurred all payroll costs of on-site employees working directly at our properties, except as noted above on our development properties prior to certificate of occupancy issuance and on specific major renovation at selected properties when additional incremental employees are hired.

Cash and Cash Equivalents

The Operating Partnership 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 Operating Partnership 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 Operating Partnership believes that the risk is not significant, as the Operating Partnership does not anticipate the financial institutions’ non-performance.

Deferred Financing Costs

Deferred financing costs include fees and costs incurred to obtain the Operating Partnership’s lines of credit and long-term financings. These costs are amortized over the terms of the related debt. Unamortized financing costs are written-off when debt is retired before the maturity date. The accumulated amortization of such deferred financing costs was $24.5 million and $18.3 million at December 31, 2006 and 2005, respectively.

Fair Value of Financial Instruments, Including Derivative Instruments

The valuation of financial instruments under SFAS No. 107, Disclosures about Fair Value of Financial Instruments, and SFAS No. 133 and its amendments (SFAS Nos. 137/138/149), Accounting for Derivative Instruments and Hedging Activities, requires the Operating Partnership to make estimates and judgments that affect the fair value of the instruments. The Operating Partnership, 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 Operating Partnership bases its estimates on current instruments with similar terms and maturities or on other factors relevant to the financial instruments.

In the normal course of business, the Operating Partnership is exposed to the effect of interest rate changes. The Operating Partnership 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 Operating Partnership 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 Operating Partnership 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 Operating Partnership 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 partners’ capital 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 Operating Partnership does not use derivatives for trading or speculative purposes.

F-14

The fair value of the Operating Partnership’s mortgage notes payable and unsecured notes were approximately $3.2 billion and $4.5 billion, respectively, at December 31, 2006. The fair values of the Operating Partnership’s financial instruments, other than mortgage notes payable, unsecured notes and derivative instruments, including cash and cash equivalents, lines of credit and other financial instruments, approximate their carrying or contract values. See Note 11 for further discussion of derivative instruments.

Revenue Recognition

Rental income attributable to leases is recorded when due from residents and is recognized monthly as it is earned, which is not materially different than on a straight-line basis. Leases entered into between a resident and a property, for the rental of an apartment unit, are generally year-to-year, renewable upon consent of both parties on an annual or monthly basis. Fee and asset management revenue and interest income are recorded on an accrual basis.

Share-Based Compensation

The Company adopted SFAS No. 123(R), Share-Based Payment, as required effective January 1, 2006. SFAS No. 123(R) requires all companies to expense share-based compensation (such as share options), as well as making other revisions to SFAS No. 123. As the Company began expensing all share-based compensation effective January 1, 2003, the adoption of SFAS No. 123(R) did not have a material effect on its consolidated statements of operations or financial position.

Any EQR common share of beneficial interest, $0.01 per value per share (the “Common Shares”) issued pursuant to EQR’s incentive equity compensation and employee share purchase plans will result in the Operating Partnership issuing units of limited partnership interest (“OP Units”) to EQR on a one-for-one basis, with the Operating Partnership receiving the net cash proceeds of such issuances.

The cost related to share-based employee compensation included in the determination of net income for the years ended December 31, 2006 and 2005 is equal to that which would have been recognized if the fair value based method had been applied to all awards since the original effective date of SFAS No. 123. The cost related to share-based employee compensation included in the determination of net income for the year ended December 31, 2004 is less than that which would have been recognized if the fair value based method had been applied to all awards since the original effective date of SFAS No. 123. The following table illustrates the effect on net income and earnings per share if the fair value based method had been applied to all outstanding and unvested awards for the year ended December 31, 2004 (amounts in thousands except per OP Unit amounts):

F-15

	Year Ended December 31, 2004
Net income available to OP Units – as reported	$	449,811
Add: Share-based employee compensation expense included in reported net income:
EQR’s performance shares	312
EQR’s restricted shares	12,242
EQR’s share options (1)	2,982
EQR’s ESPP discount	1,290
Deduct: Share-based employee compensation expense determined under fair value based method for all awards:
EQR’s performance shares	(312		)
EQR’s restricted shares	(12,242		)
EQR’s share options (1)	(5,385		)
EQR’s ESPP discount	(1,290		)
Net income available to OP Units – pro forma	$	447,408
Earnings per OP Unit:
Basic – as reported	$	1.50
Basic – pro forma	$	1.49
Diluted – as reported	$	1.48
Diluted – pro forma	$	1.47

The fair value of the option grants as computed under SFAS No. 123 would be recognized over the vesting period of the options. The fair value for the Company’s share options was estimated at the time the share options were granted using the Black-Scholes option pricing model with the following weighted-average assumptions:

	2006			2005			2004
Expected volatility	19.1		%	18.2		%	20.0		%
Expected life	6 years			6 years			5 years
Expected dividend yield	6.04		%	6.37		%	6.52		%
Risk-free interest rate	4.52		%	3.81		%	3.03		%
Option valuation per share	$	4.22		$	2.64		$	2.26

The valuation method and assumptions are the same as those the Company used in accounting for option expense in its consolidated financial statements. The Black-Scholes option valuation model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. This model is only one method of valuing options and the Company’s use of this model should not be interpreted as an endorsement of its accuracy. Because the Company’s share options have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management’s opinion, the existing models do not necessarily provide a reliable single measure of the fair value of its share options and the actual value of the options may be significantly different.

F-16

Income Taxes

The Operating Partnership generally is not liable for federal income taxes as the partners recognize their proportionate share of the Operating Partnership’s income or loss in their tax returns; therefore no provision for federal income taxes has been made at the ERPOP level. Historically, the Operating Partnership has generally only incurred certain state and local income, excise and franchise taxes. The Operating Partnership has elected Taxable REIT Subsidiary (“TRS”) status for certain of its corporate subsidiaries, primarily those entities engaged in condominium conversion and sale activities and as a result, these entities incurred federal and state income taxes.

The Operating Partnership provided for current income, franchise and excise taxes allocated as follows in the consolidated statements of operations for the years ended December 31, 2006, 2005 and 2004 (amounts in thousands):

	Year Ended December 31,
	2006		2005		2004
General and administrative (1)	$	4,263	$	3,949	$	2,432
Discontinued operations, net (2)	3,630		9,604		917
Provision for income, franchise and excise taxes	$	7,893	$	13,553	$	3,349

(1)Primarily includes state and local income, excise and franchise taxes. In 2006, also includes $2.9 million of federal income taxes related to a forfeited deposit on a terminated sale transaction and included in income from continuing operations. In 2005, also includes $2.0 million of federal income taxes related to the sale of land parcels owned by a TRS and included in income from continuing operations.

(2)Primarily represents federal income taxes incurred on the gains on sales of condominium units owned by a TRS and included in discontinued operations. Also represents state and local income, excise and franchise taxes on operating properties sold and included in discontinued operations.

The Operating Partnership utilized approximately $43.9 million of net operating losses (“NOL”) during the year ended December 31, 2005 and had no NOL carryforwards available as of January 1, 2007 or 2006.

During the years ended December 31, 2006, 2005 and 2004, the Operating Partnership’s tax treatment of dividends and distributions were as follows:

	Year Ended December 31,
	2006		2005		2004
Tax treatment of dividends and distributions:
Ordinary dividends	$	1.276	$	0.902	$	1.104
Qualified dividends	0.090		0.070		0.003
Long-term capital gain	0.330		0.669		0.432
Unrecaptured section 1250 gain	0.094		0.099		0.151
Nontaxable distributions	—		—		0.040
Dividends and distributions declared per OP Unit outstanding	$	1.790	$	1.740	$	1.730

The aggregate cost of land and depreciable property for federal income tax purposes as of December 31, 2006 and 2005 was approximately $10.2 billion and $9.4 billion, respectively.

Partners’ Capital

The “Limited Partners” of ERPOP include various individuals and entities that contributed their properties to ERPOP in exchange for OP Units. The “General Partner” of ERPOP is EQR. Net income is allocated to the Limited Partners based on their respective ownership percentage of the Operating Partnership.

F-17

The ownership percentage is calculated by dividing the number of OP Units held by the Limited Partners by the total OP Units held by the Limited Partners and the General Partner. Issuance of additional Common Shares and OP Units changes the ownership interests of both the Limited Partners and EQR. Such transactions and the related proceeds are treated as capital transactions.

Minority Interests

The Operating Partnership reflects minority interests in partially owned properties on the balance sheet for the portion of properties consolidated by the Operating Partnership that are not wholly owned by the Operating Partnership. 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 Operating Partnership’s financial statements in conformity with accounting principles generally accepted in the United States, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

Reclassifications

Certain reclassifications considered necessary for a fair presentation have been made to the prior period financial statements in order to conform to the current year presentation. These reclassifications have not changed the results of operations or partners’ capital.

Other

The Operating Partnership 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 Operating Partnership to consolidate the assets, liabilities and results of operations of the activities of a variable interest entity, which for the Operating Partnership includes only its development partnerships, if the Operating Partnership is entitled to receive a majority of the entity’s residual returns and/or is subject to a majority of the risk of loss from such entity’s activities. Due to the March 31, 2004 effective date, the Operating Partnership has only consolidated the results of operations beginning April 1, 2004. The adoption of FIN No. 46 did not have any effect on net income as the aggregate results of operations of these development properties were previously included in (loss) income from investments in unconsolidated entities.

The Operating Partnership adopted the disclosure provisions of SFAS No. 150 and FSP No. FAS 150-3, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity, effective December 31, 2003. SFAS No. 150 and FSP No. FAS 150-3 require the Operating Partnership to make certain disclosures regarding noncontrolling interests that are classified as equity in the financial statements of a subsidiary but would be classified as a liability in the parent’s financial statements under SFAS No. 150 (e.g., minority interests in consolidated limited-life subsidiaries). The Operating Partnership is presently the controlling partner in various consolidated partnerships consisting of 25 properties and 4,873 units and various uncompleted development properties having a minority interest book value of $26.8 million at December 31, 2006. Some of these partnerships contain provisions that require the partnerships to be liquidated through the sale of its assets upon reaching a date specified in each respective partnership agreement. The Operating Partnership, as controlling partner, has an obligation to cause the property owning partnerships to distribute proceeds of liquidation to the Minority Interests in these Partially Owned Properties only to the extent that the net proceeds received by the partnerships from the sale of its assets warrant a distribution based on the partnership agreements. As of December 31, 2006, the Operating Partnership estimates the value of Minority Interest distributions would have been approximately $106.7 million (“Settlement Value”) had the partnerships been liquidated. This Settlement

F-18

Value is based on estimated third party consideration realized by the partnerships upon disposition of the Partially Owned Properties and is net of all other assets and liabilities, including yield maintenance on the mortgages encumbering the properties, that would have been due on December 31, 2006 had those mortgages been prepaid. Due to, among other things, the inherent uncertainty in the sale of real estate assets, the amount of any potential distribution to the Minority Interests in the Operating Partnership’s Partially Owned Properties is subject to change. To the extent that the partnerships’ underlying assets are worth less than the underlying liabilities, the Operating Partnership has no obligation to remit any consideration to the Minority Interests in Partially Owned Properties.

The Operating Partnership adopted EITF Issue No. 04-5, Determining Whether a General Partner, or the General Partners as a Group, Controls a Limited Partnership or Similar Entity When the Limited Partners Have Certain Rights (Issue “04-5”), effective January 1, 2006. Issue 04-5 provides guidance in determining whether a general partner controls a limited partnership. The Operating Partnership consolidated its Lexford syndicated portfolio consisting of 20 separate partnerships (10 properties) containing 1,272 units, all of which were sold October 5, 2006. The adoption did not have a material effect on the results of operations or financial position. See Note 4 for further discussion of the adoption of EITF Issue No. 04-5.

In March 2005, the FASB issued FIN No. 47, Accounting for Conditional Asset Retirement Obligations, an interpretation of SFAS No. 143, Asset Retirement Obligations. A conditional asset retirement obligation refers to a legal obligation to retire assets where the timing and/or method of settlement are conditioned on future events. FIN No. 47 requires an entity to recognize a liability for the fair value of a conditional asset retirement obligation when incurred if the liability’s fair value can be reasonably estimated. The Operating Partnership adopted the provisions of FIN No. 47 for the year ended December 31, 2005. The adoption did not have a material impact on the Operating Partnership’s consolidated financial position, results of operations or cash flows.

In July 2006, the FASB ratified the consensus in FIN No. 48, Accounting for Uncertainty in Income Taxes. FIN No. 48 creates a single model to address uncertainty in income tax positions and prescribes a minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. It also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition and, clearly scopes income taxes out of SFAS No. 5, Accounting for Contingencies. The Operating Partnership will adopt FIN No. 48 as required effective January 1, 2007. While still under review, based on analyses completed and knowledge of the Operating Partnership’s tax positions to date, adoption of FIN No. 48 is not expected to have a material effect on the consolidated results of operations or financial position.

3.             Partners’ Capital

The following tables present the changes in the Operating Partnership’s issued and outstanding OP Units and the limited partners’ OP Units for the years ended December 31, 2006, 2005 and 2004:

F-19

	2006		2005	2004
OP Units outstanding at January 1,	309,960,589		305,629,855	299,551,617
Issued to General Partner:
Conversion of Series E Preference Units	104,904		314,485	1,536,501
Conversion of Series H Preference Units	9,554		3,182	10,268
Conversion of Series H and I Preference Interests	679,686		—	—
Exercise of EQR options	2,647,776		2,248,744	3,350,759
Employee Share Purchase Plan	213,427		286,751	275,616
Dividend Reinvestment – DRIP Plan	169		—	—
Restricted EQR share grants, net	603,697		520,821	515,622
Issued to Limited Partners:
Acquisitions/Consolidations	1,144,326		956,751	306,694
Conversion of Series A Junior Preference Units	—		—	82,977
OP Units Other:
Repurchased and retired	(1,897,912	)	—	—
Other	—		—	(199	)
OP Units outstanding at December 31,	313,466,216		309,960,589	305,629,855

	2006			2005			2004
Limited Partner OP Units outstanding at January 1,	20,424,245			20,552,940			21,907,732
Limited Partner OP Units Issued:
Acquisitions/consolidations	1,144,326			956,751			306,694
Conversion of Series A Junior Preference Units	—			—			82,977
Conversion of Limited Partner OP Units to EQR Common Shares	(1,653,988		)	(1,085,446		)	(1,744,463		)
Limited Partner OP Units Outstanding at December 31,	19,914,583			20,424,245			20,552,940
Limited Partner OP Units Ownership Interest in Operating Partnership	6.4		%	6.6		%	6.7		%
Limited Partner OP Units Issued:
Acquisitions/consolidations – per unit	$	43.34		$	35.18		$	29.63
Acquisitions/consolidations – valuation	$	49.6 million		$	33.7 million		$	9.1 million
Conversion of Series A Junior Preference Units – per unit	—			—			$	24.50
Conversion of Series A Junior Preference Units – valuation	—			—			$	2.0 million

In February 1998, EQR filed and the SEC declared effective a Form S-3 Registration Statement to register $1.0 billion of equity securities. In addition, EQR carried over $272.4 million related to a prior registration statement. As of February 7, 2007, $956.5 million in equity securities remained available for issuance under this registration statement. Per the terms of ERPOP’s partnership agreement, EQR contributes the net proceeds of all equity offerings to the capital of the Operating Partnership in exchange for additional OP Units (on a one-for-one common share per OP Unit basis) or preference units (on a one-for-one preferred share per preference unit basis).

During the year ended December 31, 2006, the Company repurchased 1,897,912 of its Common Shares on the open market at an average price of $43.85 per share. The Company paid approximately $83.2 million for these shares, which were retired subsequent to the repurchase. Concurrent with this transaction, the Operating Partnership repurchased and retired 1,897,912 OP Units previously issued to EQR.

The limited partners of the Operating Partnership as of December 31, 2006 include various individuals and entities that contributed their properties to the Operating Partnership in exchange for OP Units. Subject to certain restrictions, the Limited Partners may exchange their OP Units for EQR Common Shares on a one-for-one basis.

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EQR contributes all net proceeds from its various equity offerings (including proceeds from exercise of options for EQR Common Shares) to the Operating Partnership. In return for those contributions, EQR receives a number of OP Units in ERPOP 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 ERPOP equal in number and having the same terms as the preferred shares issued in the equity offering).

The following table presents the Operating Partnership’s issued and outstanding “Preference Units” as of December 31, 2006 and 2005:

			Annual			Amounts in thousands
	Redemption Date (1) (2)	Conversion Rate (2)	Dividend per Unit (3)			December 31, 2006		December 31, 2005
Preference Units:
9 1/8% Series C Cumulative Redeemable Preference Units; liquidation value $250 per unit; 0 and 460,000 units issued and outstanding at December 31, 2006 and December 31, 2005, respectively	9/9/06	N/A	(5		)	$	—	$	115,000
8.60% Series D Cumulative Redeemable Preference Units; liquidation value $250 per unit; 700,000 units issued and outstanding at December 31, 2006 and December 31, 2005 (4)	7/15/07	N/A	$	21.50		175,000		175,000
7.00% Series E Cumulative Convertible Preference Units; liquidation value $25 per unit; 434,816 and 529,096 units issued and outstanding at December 31, 2006 and December 31, 2005, respectively	11/1/98	1.1128	$	1.75		10,871		13,228
7.00% Series H Cumulative Convertible Preference Units; liquidation value $25 per unit; 28,134 and 34,734 units issued and outstanding at December 31, 2006 and December 31, 2005, respectively	6/30/98	1.4480	$	1.75		703		868
8.29% Series K Cumulative Redeemable Preference Units; liquidation value $50 per unit; 1,000,000 units issued and outstanding at December 31, 2006 and December 31, 2005	12/10/26	N/A	$	4.145		50,000		50,000
6.48% Series N Cumulative Redeemable Preference Units; liquidation value $250 per unit; 600,000 units issued and outstanding at December 31, 2006 and December 31, 2005 (4)	6/19/08	N/A	$	16.20		150,000		150,000
						$	386,574	$	504,096

(1)On or after the redemption date, redeemable preference units (Series D, K and N) may be redeemed for cash at the option of the Operating Partnership, in whole or in part, at a redemption price equal to the liquidation price per unit, plus accrued and unpaid distributions, if any, in conjunction with the concurrent redemption of the corresponding EQR Preferred Shares.

(2)On or after the redemption date, convertible preference units (Series E & H) may be redeemed under certain circumstances at the option of the Operating Partnership for cash (in the case of Series E) or OP Units (in the case of Series H), in whole or in part, at various redemption prices per unit based upon the contractual conversion rate, plus accrued and unpaid distributions, if any, in conjunction with the concurrent redemption/conversion of the corresponding EQR Preferred Shares.

(3)Dividends on all series of Preference Units are payable quarterly at various pay dates. Dividend rates listed for Series D and N are Preference Unit rates and the equivalent depositary unit annual dividends are $2.15 and $1.62 per unit, respectively.

(4)Series D and N Preference Units each have a corresponding depositary unit that consists of ten times the number of units and one-tenth the liquidation value and dividend per unit.

(5)On August 9, 2006, the Operating Partnership issued an irrevocable notice to redeem for cash on September 11, 2006 all 460,000 units of its 9 1/8% Series C Preference Units in conjunction with the concurrent redemption of the corresponding EQR Preferred Shares. The Operating Partnership recorded approximately $4.0 million as a premium on redemption of Preference Units in the accompanying consolidated statements of operations.

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During the year ended December 31, 2005, the Operating Partnership redeemed for cash all 500,000 units of its Series B Preference Units with a liquidation value of $125.0 million in conjunction with the concurrent redemption of the corresponding EQR Preferred Shares. Additionally, the Operating Partnership recorded the write-off of approximately $4.3 million in original issuance costs as a premium on redemption of Preference Units in the accompanying consolidated statements of operations.

The following table presents the issued and outstanding Preference Interests as of December 31, 2006 and December 31, 2005:

			Annual		Amounts in thousands
	Redemption Date (1)(2)	Conversion Rate (2)	Dividend per Unit (3)		December 31, 2006		December 31, 2005
Preference Interests:
7.875% Series G Cumulative Redeemable Preference Units; liquidation value $50 per unit; 0 and 510,000 units issued and outstanding at December 31, 2006 and December 31, 2005, respectively	03/21/06	N/A	(4)		$	—	$	25,500
7.625% Series H Cumulative Convertible Redeemable Preference liquidation value $50 per unit; 0 and 190,000 units issued and at December 31, 2006 and December 31, 2005, respectively	03/23/06	1.5108	(5)		—		9,500
7.625% Series I Cumulative Convertible Redeemable Preference liquidation value $50 per unit; 0 and 270,000 units issued and at December 31, 2006 and December 31, 2005, respectively	06/22/06	1.4542	(6)		—		13,500
7.625% Series J Cumulative Convertible Redeemable Preference liquidation value $50 per unit; 230,000 units issued and at December 31, 2006 and December 31, 2005	12/14/06	1.4108	$	3.8125	11,500		11,500
					$	11,500	$	60,000

(1)On or after the fifth anniversary of the respective issuance (the “Redemption Date”), all of the Preference Interests may be redeemed for cash at the option of the Operating Partnership, in whole or in part, at any time or from time to time, at a redemption price equal to the liquidation preference of $50.00 per unit plus the cumulative amount of accrued and unpaid distributions, if any.

(2)On or after the tenth anniversary of the respective issuance (the “Conversion Date”), all of the Preference Interests are exchangeable at the option of the holder (in whole but not in part) on a one-for-one basis for a respective reserved series of EQR Preferred Shares. In addition, on or after the Conversion Date, the convertible Preference Interests may be converted under certain circumstances at the option of the holder (in whole but not in part) to Common Shares based upon the contractual conversion rate, plus accrued and unpaid distributions, if any. Prior to the Conversion Date, the convertible Preference Interests may be converted under certain circumstances at the option of the holder (in whole but not in part) to Common Shares based upon the contractual conversion rate, plus accrued and unpaid distributions, if any, if the issuer has called the series for redemption (the “Accelerated Conversion Right”).

(3)Dividends on all series of Preference Interests are payable quarterly on March 25^th, June 25^th, September 25^th, and December 25^th of each year.

(4)On February 15, 2006, the Operating Partnership issued an irrevocable notice to redeem for cash on March 21, 2006 all 510,000 units of its 7.875% Series G Preference Interests with a liquidation value of $25.5 million. The Operating Partnership recorded approximately $0.7 million as a premium on redemption of Preference Interests in the accompanying consolidated statements of operations.

(5)On February 15, 2006, the Operating Partnership issued an irrevocable notice to redeem for cash on March 23, 2006 all 190,000 units of its 7.625% Series H Preference Interests with a liquidation value of $9.5 million. This notice triggered the holder’s Accelerated Conversion Right, which they exercised. As a result, effective March 23, 2006, the 190,000 units were converted to 287,052 Common Shares.

(6)On May 16, 2006, the Operating Partnership issued an irrevocable notice to redeem for cash on June 22, 2006 all 270,000 units of its 7.625% Series I Preference Interests with a liquidation value of $13.5 million. This notice triggered the holder’s Accelerated Conversion Right, which they exercised. As a result, effective June 22, 2006, the 270,000 units were converted to 392,634 Common Shares.

F-22

During the year ended December 31, 2005, the Operating Partnership redeemed or repurchased for cash all of its Series B through F Preference Interests with a liquidation value of $146.0 million. The Operating Partnership recorded approximately $4.1 million as premiums on redemption of Preference Interests in the accompanying consolidated statements of operations, which included $3.8 million in original issuance costs and $0.3 million in cash redemption charges.

During the year ended December 31, 2004, the Operating Partnership redeemed for cash all 800,000 units of it 8.00% Series A Preference Interests with a liquidation value of $40.0 million. The Operating Partnership recorded approximately $1.1 million as premiums on redemption of Preference Interests in the accompanying consolidated statements of operations.

The following table presents the Operating Partnership’s issued and outstanding Junior Convertible Preference Units (the “Junior Preference Units”) as of December 31, 2006 and December 31, 2005:

			Annual		Amounts in thousands
	Redemption Date (2)	Conversion Rate (2)	Dividend per Unit (1)		December 31, 2006		December 31, 2005
Junior Preference Units:
Series B Junior Convertible Preference Units; liquidation value $25 per unit; 7,367 units issued and outstanding at December 31, 2006 and December 31, 2005	07/29/09	1.020408	$	2.00	$	184	$	184
					$	184	$	184

(1)Dividends on the Junior Preference Units are payable quarterly at various pay dates.

(2)On or after the tenth anniversary of the issuance (the “Redemption Date”), the Series B Junior Preference Units may be converted into OP Units at the option of the Operating Partnership based on the contractual conversion rate. Prior to the Redemption Date, the holders may elect to convert the Series B Junior Preference Units to OP Units under certain circumstances based on the contractual conversion rate. The contractual rate is based upon a ratio dependent upon the closing price of EQR’s Common Shares.

4.Real Estate

The following table summarizes the carrying amounts for investment in real estate (at cost) as of December 31, 2006 and 2005 (Amounts in thousands):

	2006			2005
Land	$	3,217,672		$	2,848,601
Depreciable property:
Buildings and improvements	12,563,807			12,583,020
Furniture, fixtures and equipment	812,552			753,616
Projects under development:
Land	125,496			90,261
Construction-in-progress	261,421			150,719
Land held for development:
Land	214,704			148,234
Construction-in-progress	39,523			15,919
Investment in real estate	17,235,175			16,590,370
Accumulated depreciation	(3,022,480		)	(2,888,140		)
Investment in real estate, net	$	14,212,695		$	13,702,230

During the year ended December 31, 2006, the Operating Partnership acquired the entire equity interest in 35 properties containing 8,768 units and nine land parcels from unaffiliated parties for a total purchase price of $1.9 billion. The Operating Partnership also acquired the majority of its partners’ interest in

F-23

eighteen partially owned properties containing 1,643 units for $56.6 million, partially funded through the issuance of 417,039 OP Units valued at $18.6 million.

The Operating Partnership adopted EITF Issue No. 04-5, as required for existing limited partnership arrangements, effective January 1, 2006. The adoption required the consolidation of the Lexford syndicated portfolio consisting of 20 separate partnerships (10 properties) containing 1,272 units, all of which were sold October 5, 2006. The Operating Partnership recorded $24.6 million in investment in real estate and also:

•      Consolidated $22.5 million in mortgage debt;

•      Reduced investments in unconsolidated entities by $2.6 million;

•      Consolidated $0.9 million of other liabilities net of other assets acquired; and

•      Consolidated $1.4 million of cash.

During the year ended December 31, 2005, the Operating Partnership acquired the entire equity interest in forty-one properties containing 12,059 units, inclusive of one additional unit at one existing property, and seven land parcels from unaffiliated parties for a total purchase price of $2.7 billion.

During the year ended December 31, 2005, the Operating Partnership also acquired a majority interest in the remaining equity interests it did not previously own in sixteen Partially Owned Properties, all of which remain partially owned. The acquisitions were funded using $24.2 million in cash and through the issuance of 614,717 OP Units valued at $20.8 million, with $43.0 million recorded as additional building basis and $2.0 million recorded as a reduction of Minority Interests – Partially Owned Properties. The Operating Partnership also acquired the majority of the remaining third party equity interests it did not previously own in three properties, consisting of 211 units. The properties were previously accounted for under the equity method of accounting and subsequent to each purchase were consolidated. The Operating Partnership recorded $5.6 million in investment in real estate and also:

•      Assumed $2.8 million in mortgage debt;

•      Reduced investments in unconsolidated entities by $1.2 million;

•      Assumed $1.5 million of other liabilities net of other assets acquired; and

•      Paid cash of $0.1 million (net of cash acquired).

During the year ended December 31, 2006, the Operating Partnership disposed of the following to unaffiliated parties (sales price in thousands):

	Properties	Units	Sales Price
Rental Properties	335	39,608	$	2,255,442
Condominium Units	5	1,069	215,972
Land Parcels (two)	—	—	1,569
	340	40,677	$	2,472,983

The Operating Partnership recognized a net gain on sales of discontinued operations of approximately $1.0 billion (amount is net of $3.2 million of income taxes incurred on condominium sales – see additional discussion in Note 2), a net gain on sales of land parcels of approximately $2.8 million and a net gain on sales of unconsolidated entities of $0.4 million on the above sales.

On June 28, 2006, the Operating Partnership announced that it agreed to sell its Lexford Housing Division for a cash purchase price of $1.086 billion. The sale closed on October 5, 2006. The Lexford Housing Division results are classified as discontinued operations, net in the consolidated statements of operations for all periods presented. The Operating Partnership recorded a gain on sale of approximately $418.7 million on the sale of the Lexford Housing Division in the fourth quarter of 2006. In conjunction with the Lexford disposition, the Operating Partnership paid off/extinguished $196.3 million of mortgage notes payable secured by the properties and incurred approximately $9.2 million in prepayment penalties

F-24

upon extinguishment. The Operating Partnership also recorded approximately $4.5 million in one-time accrued retention benefits during the third quarter of 2006 related to the Lexford disposition. These costs are included in discontinued operations, net in the consolidated statements of operations. See Note 13 for additional information.

During the year ended December 31, 2005, the Operating Partnership disposed of the following to unaffiliated parties (sales price in thousands):

	Properties	Units	Sales Price
Rental Properties	50	12,848	$	1,351,636
Condominium Units	6	2,241	593,305
Land Parcels (five)	—	—	108,280
	56	15,089	$	2,053,221

The Operating Partnership recognized a net gain on sales of discontinued operations of approximately $697.7 million (amount is net of $8.8 million of income taxes incurred on condominium sales – see additional discussion in Note 2), a net gain on sales of land parcels of approximately $30.2 million and a net gain on the sales of unconsolidated entities of $1.3 million on the above sales.

5.             Commitments to Acquire/Dispose of Real Estate

As of February 7, 2007, in addition to the properties that were subsequently acquired as discussed in Note 21, the Operating Partnership had entered into separate agreements to acquire the following (purchase price in thousands): 

	Properties /Parcels	Units	Purchase Price
Operating Properties	5	1,564	$	410,850
Land Parcels	4	—	88,552
Total	9	1,564	$	499,402

As of February 7, 2007, in addition to the property that was subsequently disposed of as discussed in Note 21, the Operating Partnership had entered into separate agreements to dispose of the following (sales price in thousands):

	Properties /Parcels	Units	Sales Price
Operating Properties	13	4,365	$	319,130
Land Parcels	1	—	4,000
Total	14	4,365	$	323,130

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

6.             Investments in Partially Owned Entities

The Operating Partnership has co-invested in various properties with unrelated third parties which are either consolidated or accounted for under the equity method of accounting (unconsolidated). The following table summarizes the Operating Partnership’s investments in partially owned entities as of December 31, 2006 (amounts in thousands except for project and unit amounts):

F-25

		Consolidated								Unconsolidated
		Development Projects
		Held for and/or Under Development		Completed and Stabilized		Other		Total		Institutional Joint Ventures
Total projects	(1)	—		4		21		25		45
Total units	(1)	—		977		3,896		4,873		10,846
Debt – Secured (2):
EQR Ownership (3)		$	159,154	$	61,000	$	287,022	$	507,176	$	121,200
Minority Ownership		—		—		13,321		13,321		363,600
Total (at 100%)		$	159,154	$	61,000	$	300,343	$	520,497	$	484,800

(1) Project and unit counts exclude all uncompleted development projects until those projects are completed.

(2) All debt is non-recourse to the Operating Partnership with the exception of $28.3 million in mortgage bonds on one development project.

(3) Represents the Operating Partnership’s economic ownership interest.

7.             Deposits - - Restricted

The following table presents the restricted deposits as of December 31, 2006 and 2005 (amounts in thousands):

	December 31, 2006		December 31, 2005
Tax–deferred (1031) exchange proceeds	$	299,392	$	853
Earnest money on pending acquisitions	13,170		15,120
Resident security, utility and other	79,263		61,120
	$	391,825	$	77,093

8.             Mortgage Notes Payable

As of December 31, 2006, the Operating Partnership had outstanding mortgage debt of approximately $3.2 billion.

During the year ended December 31, 2006, the Operating Partnership:

•Repaid $493.0 million of mortgage loans;

•Assumed/consolidated $149.5 million of mortgage debt on certain properties in connection with their acquisition and/or consolidation;

•Obtained $267.0 million of new mortgage loans on certain properties; and

•Was released from $117.9 million of mortgage debt assumed by the purchaser on disposed properties.

As of December 31, 2006, scheduled maturities for the Operating Partnership’s outstanding mortgage indebtedness were at various dates through September 1, 2045. At December 31, 2006, the interest rate range on the Operating Partnership’s mortgage debt was 3.32% to 12.465%. During the year ended December 31, 2006, the weighted average interest rate on the Operating Partnership’s mortgage debt was 5.82%.

The historical cost, net of accumulated depreciation, of encumbered properties was $4.7 billion and $4.8 billion at December 31, 2006 and 2005, respectively.

F-26

Aggregate payments of principal on mortgage notes payable for each of the next five years and thereafter are as follows (amounts in thousands):

Year	Total
2007	$	307,941
2008	420,583
2009	540,679
2010	279,688
2011	529,601
Thereafter	1,099,731
Total	$	3,178,223

As of December 31, 2005, the Operating Partnership had outstanding mortgage indebtedness of approximately $3.4 billion.

During the year ended December 31, 2005, the Operating Partnership:

•Repaid $470.4 million of mortgage loans;

•Assumed/consolidated $446.3 million of mortgage debt on certain properties in connection with their acquisition and/or consolidation;

•Obtained $280.1 million of new mortgage loans on certain properties; and

•Was released from $35.0 million of mortgage debt assumed by the purchaser on disposed properties.

As of December 31, 2005, scheduled maturities for the Operating Partnership’s outstanding mortgage indebtedness were at various dates through February 1, 2041. At December 31, 2005, the interest rate range on the Operating Partnership’s mortgage debt was 3.35% to 12.465%. During the year ended December 31, 2005, the weighted average interest rate on the Operating Partnership’s mortgage debt was 5.63%.

9.             Notes

The following tables summarize the Operating Partnership’s unsecured note balances and certain interest rate and maturity date information as of and for the years ended December 31, 2006 and 2005, respectively:

December 31, 2006 (Amounts are in thousands)	Net Principal Balance		Interest Rate Ranges		Weighted Average Interest Rate		Maturity Date Ranges
Fixed Rate Public/Private Notes (1)	$	4,158,043	3.85% - 7.625	%	5.90	%	2007 - 2026
Floating Rate Public Notes (1)	150,000		(1)		6.13	%	2009
Fixed Rate Tax-Exempt Bonds	111,390		4.75% - 5.20	%	5.06	%	2028 - 2029
Totals	$	4,419,433

(1) $150.0 million in fair value interest rate swaps converts 50% of the $300.0 million 4.750% notes due June 15, 2009 to a floating interest rate.

F-27

December 31, 2005  (Amounts are in thousands)	Net Principal Balance		Interest Rate Ranges		Weighted Average Interest Rate		Maturity Date Ranges
Fixed Rate Public/Private Notes	$	3,331,394	4.75% - 7.625	%	6.13	%	2006 - 2026
Fixed Rate Tax-Exempt Bonds	111,390		4.75% - 5.20	%	5.06	%	2028 - 2029
Totals	$	3,442,784

The Operating Partnership’s unsecured public debt contains certain financial and operating covenants including, among other things, maintenance of certain financial ratios. The Operating Partnership was in compliance with its unsecured public debt covenants for both the years ended December 31, 2006 and 2005.

As of February 7, 2007, an unlimited amount of debt securities remains available for issuance by the Operating Partnership under a registration statement that became automatically effective upon filing with the SEC in June 2006 (under SEC regulations enacted in 2005, the registration statement automatically expires on June 29, 2009 and does not contain a maximum issuance amount).

During the year ended December 31, 2006, the Operating Partnership:

•Issued $400.0 million of ten and one-half year 5.375% fixed-rate public notes, receiving net proceeds of $395.5 million;

•Issued $650.0 million of twenty year 3.85% fixed rate public notes that are exchangeable into EQR Common Shares, receiving net proceeds of $637.0 million (see further discussion below);

•Repaid $60.0 million of fixed-rate public notes at maturity; and

•Repaid $4.3 million of other unsecured notes.

On August 23, 2006, the Operating Partnership issued $650.0 million of exchangeable senior notes that mature on August 15, 2026. The notes bear interest at a fixed rate of 3.85%. The notes are exchangeable into EQR Common Shares, at the option of the holders, under specific circumstances or on or after August 15, 2025, at an initial exchange rate of 16.3934 shares per $1,000 principal amount of notes (equivalent to an initial exchange price of $61.00 per share). The initial exchange rate is subject to adjustment in certain circumstances, including upon an increase in EQR’s dividend rate. Upon an exchange of the notes, the Operating Partnership will settle any amounts up to the principal amount of the notes in cash and the remaining exchange value, if any, will be settled, at the Operating Partnership’s option, in cash, EQR Common Shares or a combination of both.

On or after August 18, 2011, the Operating Partnership may redeem the notes at a redemption price equal to the principal amount of the notes plus any accrued and unpaid interest thereon. Upon notice of redemption by the Operating Partnership, the holders may elect to exercise their exchange rights. In addition, on August 18, 2011, August 15, 2016 and August 15, 2021 or following the occurrence of certain change in control transactions prior to August 18, 2011, note holders may require the Operating Partnership to repurchase the notes for an amount equal to the principal amount of the notes plus any accrued and unpaid interest thereon.

Note holders may also require an exchange of the notes should the closing sale price of EQR Common Shares exceed 130% of the exchange price for a certain period of time or should the trading price on the notes be less than 98% of the product of the closing sales price of EQR Common Shares multiplied by the applicable exchange rate for a certain period of time.

During the year ended December 31, 2005, the Operating Partnership:

•Issued $500.0 million of ten and one-half year 5.125% fixed-rate public notes, receiving net

F-28

proceeds of $496.2 million;

•Had $300.0 million in fixed rate public notes remarketed as originally contemplated in a remarketing agreement entered into in connection with the original issuance of the notes, with the interest rate changing from 6.63% to 6.584% effective April 14, 2005 (notes still mature on April 13, 2015);

•Repaid $190.0 million of fixed rate public notes at maturity; and

•Repaid $4.3 million of other unsecured notes.

Aggregate payments of principal on unsecured notes payable for each of the next five years and thereafter are as follows (amounts in thousands):

Year	Total
2007	$	153,522
2008	129,251
2009	294,838
2010 (1)	(365		)
2011 (2)	942,994
Thereafter	2,899,193
Total	$	4,419,433

(1)Principal payments on unsecured notes includes amortization of any discounts or premiums related to the notes. Premiums and discounts are amortized over the life of the unsecured notes.

(2)   Includes the $650.0 million of 3.85% convertible unsecured debt with a final maturity of 2026.

10.          Lines of Credit

The Operating Partnership has an unsecured revolving credit facility with potential borrowings of up to $1.0 billion maturing on May 29, 2008, with the ability to increase available borrowings by an additional $500.0 million under certain circumstances. Advances under the credit facility bear interest at variable rates based upon LIBOR at various interest periods plus a spread dependent upon the Operating Partnership’s credit rating or based on bids received from the lending group. EQR has guaranteed the Operating Partnership’s credit facility up to the maximum amount and for its full term.

On August 30, 2005, the Operating Partnership entered into a one-year $600.0 million revolving credit facility maturing on August 29, 2006. This credit facility was repaid in full and terminated on January 20, 2006.

On July 6, 2006, the Operating Partnership entered into a one-year $500.0 million revolving credit facility maturing on July 6, 2007. This facility was repaid in full and terminated on October 13, 2006. Advances under this facility bore interest at variable rates based on LIBOR at various interest periods plus a spread dependent upon the Operating Partnership’s credit rating. EQR guaranteed this credit facility up to the maximum amount and for its full term.

As of December 31, 2006 and 2005, $460.0 million and $769.0 million, respectively, was outstanding and $69.3 million and $50.2 million, respectively, was restricted (dedicated to support letters of credit and not available for borrowing) on the credit facilities. During the years ended December 31, 2006 and 2005, the weighted average interest rates were 5.40% and 3.80%, respectively.

11.          Derivative Instruments

The following table summarizes the consolidated derivative instruments at December 31, 2006 (dollar amounts are in thousands):

F-29

	Fair Value Hedges (1)			Forward Starting Swaps (2)			Development Cash Flow Hedges (3)
Current Notional Balance	$	370,000		$	100,000		$	40,775
Lowest Possible Notional	$	370,000		$	100,000		$	13,925
Highest Possible Notional	$	370,000		$	100,000		$	46,296
Lowest Interest Rate	3.245		%	5.596		%	4.530		%
Highest Interest Rate	3.787		%	5.596		%	4.530		%
Earliest Maturity Date	2009			2017			2007
Latest Maturity Date	2009			2017			2007
Estimated Asset (Liability) Fair Value	$	(13,130	)	$	(3,122	)	$	57

(1) Fair Value Hedges – Converts outstanding fixed rate debt to a floating interest rate.

(2) Forward Starting Swaps – Designed to partially fix the interest rate in advance of a planned future debt issuance.

(3) Development Cash Flow Hedges – Converts outstanding floating rate debt to a fixed interest rate.

On December 31, 2006, the net derivative instruments were reported at their fair value as other assets of approximately $0.1 million and as other liabilities of approximately $16.3 million. As of December 31, 2006, there were approximately $14.6 million in deferred losses, net, included in accumulated other comprehensive loss. Based on the estimated fair values of the net derivative instruments at December 31, 2006, the Operating Partnership may recognize an estimated $2.4 million of accumulated other comprehensive loss as additional interest expense during the year ending December 31, 2007.

In January 2006, the Operating Partnership received approximately $10.7 million to terminate six forward starting swaps in conjunction with the issuance of $400.0 million of ten and one-half year unsecured notes. The $10.7 million has been deferred as a component of accumulated other comprehensive loss and will be recognized as a reduction of interest expense over the life of the unsecured notes.

12.          Earnings Per OP Unit

The following tables set forth the computation of net income per OP Unit – basic and net income per OP Unit – diluted (amounts in thousands except per OP Unit amounts):

	Year Ended December 31,
	2006			2005			2004
Numerator for net income per OP Unit – basic and diluted:
Income from continuing operations	$	86,699		$	151,743		$	96,756
Allocation to Preference Units	(37,113		)	(49,642		)	(53,746		)
Allocation to Preference Interests and Junior Preference Units	(2,002		)	(7,606		)	(19,490		)
Allocation to premium on redemption of Preference Units	(3,965		)	(4,359		)	—
Allocation to premium on redemption of Preference Interests	(684		)	(4,134		)	(1,117		)
Income from continuing operations available to OP Units	42,935			86,002			22,403
Discontinued operations, net	1,061,405			780,304			427,408
Numerator for net income per OP Unit – basic and diluted	$	1,104,340		$	866,306		$	449,811

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	Year Ended December 31,
	2006		2005		2004
Denominator for net income per OP Unit – basic and diluted:
Denominator for net income per OP Unit – basic	310,452		306,579		300,683
Effect of dilutive securities:
Dilution for OP Units issuable upon assumed exercise/vesting of EQR’s share options/restricted shares	5,127		4,206		3,188
Denominator for net income per OP Unit – diluted	315,579		310,785		303,871
Net income per OP Unit – basic	$	3.56	$	2.83	$	1.50
Net income per OP Unit – diluted	$	3.50	$	2.79	$	1.48
Net income per OP Unit – basic:
Income from continuing operations available to OP Units	$	0.138	$	0.281	$	0.074
Discontinued operations, net	3.420		2.546		1.422
Net income per OP Unit – basic	$	3.558	$	2.827	$	1.496
Net income per OP Unit – diluted:
Income from continuing operations available to OP Units	$	0.136	$	0.277	$	0.074
Discontinued operations, net	3.363		2.511		1.406
Net income per OP Unit – diluted	$	3.499	$	2.788	$	1.480

Convertible preference interests/units that could be converted into 1,163,908, 1,772,048 and 3,215,472 weighted average Common Shares (which would be contributed to the Operating Partnership in exchange for OP Units) for the years ended December 31, 2006, 2005 and 2004, respectively, were outstanding but were not included in the computation of diluted earnings per OP Unit because the effects would be anti-dilutive. In addition, the effect of the Common Shares/OP Units that could ultimately be issued upon the conversion/exchange of the Operating Partnership’s $650.0 million exchangeable senior notes were not included in the computation of diluted earnings per OP Unit because the effects would be anti-dilutive.

For additional disclosures regarding the employee share options and restricted shares, see Notes 2 and 14.

13.Discontinued Operations

The Operating Partnership 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) and all operations related to condominium conversion properties effective upon their respective transfer into a TRS. Results are reflective of dispositions through June 30, 2007.

The components of discontinued operations are outlined below and include the results of operations for the respective periods that the Operating Partnership owned such assets during each of the years ended December 31, 2006, 2005, and 2004 (amounts in thousands).

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	Year Ended December 31,
	2006			2005			2004
REVENUES
Rental income	$	266,945		$	448,449		$	541,260
Fee and asset management	—			908			1,053
Total revenues	266,945			449,357			542,313
EXPENSES (1)
Property and maintenance	92,951			146,491			173,376
Real estate taxes and insurance	33,959			59,221			66,670
Property management	8,934			10,639			9,989
Depreciation	53,874			111,250			137,050
General and administrative	587			1,149			980
Impairment	351			—			—
Total expenses	190,656			328,750			388,065
Discontinued operating income	76,289			120,607			154,248
Interest and other income	1,643			1,429			431
Interest (2):
Expense incurred, net	(31,976		)	(38,612		)	(44,149		)
Amortization of deferred financing costs	(994		)	(775		)	(1,565		)
Discontinued operations	44,962			82,649			108,965
Net gain on sales of discontinued operations	1,016,443			697,655			318,443
Discontinued operations, net	$	1,061,405		$	780,304		$	427,408

Note:  Discontinued operations includes the Lexford Housing Division.

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

(2)Includes only interest expense specific to secured mortgage notes payable for properties sold.

For the properties sold during 2006 and the first six months of 2007 (excluding condominium conversion properties), the investment in real estate, net of accumulated depreciation, and the mortgage notes payable balances at December 31, 2005 were $1.7 billion and $485.8 million, respectively. For the properties sold during the first six months of 2007 (excluding condominium conversion properties), the investment in real estate, net of accumulated depreciation, and the mortgage notes payable balances at December 31, 2006 were $454.8 million and $85.6 million, respectively.

The net real estate basis of the Operating Partnership’s condominium conversion properties owned by the TRS and included in discontinued operations (excludes the Operating Partnership’s five halted conversions as they are now held for use), which were included in investment in real estate, net in the consolidated balance sheets, was $95.4 million and $121.3 million at December 31, 2006 and 2005, respectively.

14.Share Incentive Plans

Any Common Shares issued pursuant to EQR’s incentive equity compensation and employee share purchase plans will result in the Operating Partnership issuing OP Units to EQR on a one-for-one basis, with the Operating Partnership receiving the net cash proceeds of such issuances.

On May 15, 2002, the shareholders of EQR approved the Company’s 2002 Share Incentive Plan. The

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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 the first day of each calendar year. As of January 1, 2007, this amount equaled 23,574,211, of which 13,521,150 is available for future issuance. No awards may be granted under the 2002 Share Incentive Plan after February 20, 2012.

Pursuant to the 2002 Share Incentive Plan and the Fifth Amended and Restated 1993 Share Option and Share Award Plan (collectively the “Share Incentive Plans”), officers, trustees and key employees of the Company may be granted share options to acquire Common Shares (“Options”) including non-qualified share options (“NQSOs”), incentive share options (“ISOs”) and share appreciation rights (“SARs”), or may be granted restricted or non-restricted shares, subject to conditions and restrictions as described in the Share Incentive Plans. Finally, certain executive officers of the Company participate in the Company’s performance based restricted share plan. Options, SARs, restricted shares and performance shares are sometimes collectively referred to herein as “Awards”.

The Options are generally granted at the fair market value of the Company’s Common Shares at the date of grant, vest in three equal installments over a three year period, are exercisable upon vesting and expire ten years from the date of grant. The exercise price for all Options under the Share Incentive Plans is equal to the fair market value of the underlying Common Shares at the time the Option is granted. The Fifth Amended and Restated 1993 Share Option and Share Award Plan will terminate at such time as all outstanding Awards have expired or have been exercised/vested. The Board of Trustees may at any time amend or terminate the Share Incentive Plans, but termination will not affect Awards previously granted. Any Options which had vested prior to such a termination would remain exercisable by the holder.

As to the restricted shares that have been awarded through December 31, 2006, these shares generally vest three years from the award date. During the three-year period of restriction, the Company’s unvested restricted shareholders receive quarterly dividend payments on their shares at the same rate and on the same date as any other Common Share holder. In addition, the Company’s unvested restricted shareholders have the same voting rights as any other Common Share holder. As a result, dividends paid on unvested restricted shares are included as a component of retained earnings (deficit) and have not been considered in reducing net income available to OP Units in a manner similar to the Operating Partnership preference unit dividends for the earnings per OP Unit calculation. If employment is terminated prior to the lapsing of the restriction, the shares are generally canceled.

In addition, each year prior to 2007, selected executive officers of the Company received performance-based awards. Effective January 1, 2007, the Company has elected to discontinue the award of new performance-based award grants. The executive officers have the opportunity to earn in Common Shares an amount as little as 0% to as much as 225% of the target number of performance-based awards. The owners of performance-based awards have no right to vote, receive dividends or transfer the awards until Common Shares are issued in exchange for the awards. The number of Common Shares the executive officer actually receives on the third anniversary of the grant date will depend on the excess, if any, by which the Company’s Average Annual Return (i.e., the average of the Common Share dividends declared during each year as a percentage of the Common Share price as of the first business day of the first performance year and the average percentage increase in funds from operations (“FFO”) for each calendar year on a per share basis over the prior year) for the three performance years exceeds the average of the 10-year Treasury Note interest rate as of the first business day in January of each performance year (the “T-Note Rate”).

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If the Company’s Average Annual Return exceeds the T-Note Rate by:	Less than 0.99	%	1-1.99	%	2	%	3	%	4	%	5	%	6	%	Greater than 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	%

If the Company’s Average Annual Return exceeds the T-Note Rate by an amount which falls between any of the percentages in excess of the 2% threshold, the performance-based award will be determined by extrapolation between the two percentages. Fifty percent of the Common Shares to which an executive officer may be entitled under the performance share grants will vest, subject to the executive’s continued employment with the Company, on the third anniversary of the award (which will be the date the Common Shares are issued); twenty-five percent will vest on the fourth anniversary and the remaining twenty-five percent will vest on the fifth anniversary. The Common Shares will also fully vest upon the executive’s death, retirement at or after age 62, disability or upon a change in control of the Company.

The following tables summarize compensation information regarding the performance shares, restricted shares, share options and ESPP for the three years ended December 31, 2006, 2005 and 2004 (amounts in thousands):

	Year Ended December 31, 2006
	Compensation Expense		Compensation Capitalized		Compensation Equity		Dividends Incurred
Performance shares	$	1,795	$	—	$	1,795	$	—
Restricted shares	13,923		1,021		14,944		2,437
Share options	4,868		330		5,198		—
ESPP discount	1,494		84		1,578		—
Total	$	22,080	$	1,435	$	23,515	$	2,437

	Year Ended December 31, 2005				Year Ended December 31, 2004
	Compensation Expense/Equity		Dividends Incurred		Compensation Expense/Equity		Dividends Incurred
Performance shares	$	7,697	$	—	$	312	$	—
Restricted shares	20,055		2,743		12,242		2,508
Share options	6,562		—		2,982		—
ESPP discount	1,591		—		1,290		—
Total	$	35,905	$	2,743	$	16,826	$	2,508

Compensation expense is recognized for all Awards over the vesting period. The total compensation expense related to Awards not yet vested at December 31, 2006 is $23.7 million, which is expected to be recognized over a weighted average term of
1.6 years.

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

The table below summarizes the Award activity of the Share Incentive Plans and options assumed in connection with mergers (the “Merger Options”) for the three years ended December 31, 2006, 2005 and 2004:

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	Common Shares Subject to Options		Weighted Average Exercise Price Per Option		Restricted Shares		Weighted Average Fair Value per Restricted Share
Balance at December 31, 2003	12,085,598		$	24.27	1,362,733		$	22.75
Awards granted (2002 plan)	2,254,570		$	29.33	572,688		$	29.28
Awards exercised/vested (1993 plan)	(2,920,057	)	$	23.75	(457,127	)	$	20.05
Awards exercised/vested (2002 plan)	(423,866	)	$	23.55	(7,973	)	$	28.05
Merger Options exercised	(6,836	)	$	20.14	—		—
Awards canceled (1993 plan)	(90,436	)	$	23.44	(33,374	)	$	25.25
Awards canceled (2002 plan)	(79,751	)	$	28.02	(23,692	)	$	28.19
Balance at December 31, 2004	10,819,222		$	25.48	1,413,255		$	26.06
Awards granted (2002 plan)	2,235,268		$	31.91	620,192		$	31.89
Awards exercised/vested (1993 plan)	(1,630,321	)	$	23.44	(373,310	)	$	24.68
Awards exercised/vested (2002 plan)	(611,943	)	$	26.31	(190,938	)	$	29.36
Merger Options exercised	(6,480	)	$	18.10	—		—
Awards canceled (1993 plan)	(27,677	)	$	24.53	(12,363	)	$	23.64
Awards canceled (2002 plan)	(205,326	)	$	30.32	(87,008	)	$	29.55
Balance at December 31, 2005	10,572,743		$	27.02	1,369,828		$	28.42
Awards granted (2002 plan)	1,671,122		$	42.32	684,998		$	34.76
Awards exercised/vested (1993 plan) (1)	(1,754,288	)	$	25.24	(151,104	)	$	23.55
Awards exercised/vested (2002 plan) (1)	(890,326	)	$	29.24	(519,664	)	$	21.07
Merger Options exercised (1)	(3,162	)	$	19.49	—		—
Awards canceled (1993 plan)	(8,866	)	$	22.46	(275	)	$	23.55
Awards canceled (2002 plan)	(171,436	)	$	35.28	(81,026	)	$	34.74
Balance at December 31, 2006	9,415,787		$	29.71	1,302,757		$	34.85

(1) The aggregate intrinsic value of options exercised during the year ended December 31, 2006 was $58.0 million.

The following table summarizes information regarding options outstanding at December 31, 2006:

	Options Outstanding (1)
		Weighted			Options Exercisable (2)
Range of Exercise Prices	Options	Average Remaining Contractual Life in Years	Weighted Average Exercise Price		Options	Weighted Average Exercise Price
$9.00 to $18.13	92	0.01	$	9.55	92	$	9.55
$18.14 to $22.67	837,986	2.52	$	20.56	837,986	$	20.56
$22.68 to $27.20	2,376,911	3.78	$	24.63	2,376,911	$	24.63
$27.21 to $31.73	2,784,929	5.98	$	28.30	2,264,236	$	28.06
$31.74 to $36.26	1,817,740	8.05	$	31.77	773,233	$	31.77
$36.27 to $40.80	329,167	8.96	$	39.74	302,967	$	39.90
$40.81 to $45.33	1,268,962	9.03	$	42.81	76,624	$	42.80
$9.00 to $45.33	9,415,787	6.03	$	29.71	6,632,049	$	27.03

(1) The aggregate intrinsic value of options outstanding as of December 31, 2006 is $198.1 million.

(2) The aggregate intrinsic value and weighted average remaining contractual life in years of options exercisable as of December 31, 2006 is $156.8 million and 5.1 years, respectively.

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As of December 31, 2005 and 2004, 6,864,922 Options (with a weighted average exercise price of $25.60) and 6,851,442 Options (with a weighted average exercise price of $24.47) were exercisable, respectively.

15.Employee Plans

The Company established an Employee Share Purchase Plan (the “ESPP”) to provide employees and EQR trustees the ability to annually acquire up to $100,000 of Common Shares of EQR. In 2003, EQR’s shareholders approved an increase in the aggregate number of Common Shares available under the ESPP to 7,000,000 (from 2,000,000). The Company has 4,270,759 Common Shares available for purchase under the ESPP at December 31, 2006. The Common Shares may be purchased quarterly at a price equal to 85% of the lesser of: (a) the closing price for a share on the last day of such quarter; and (b) the greater of: (i) the closing price for a share on the first day of such quarter, and (ii) the average closing price for a share for all the business days in the quarter. The following table summarizes information regarding the Common Shares issued under the ESPP (the net proceeds noted below were contributed to the Operating Partnership in exchange for OP Units):

	Year Ended December 31,
	2006	2005	2004
	(Amounts in thousands except share and per share amounts)
Shares issued	213,427	286,751	275,616
Issuance price ranges	$35.43 – $43.30	$27.89 – $32.27	$23.35 – $27.39
Issuance proceeds	$7,972	$8,285	$6,853

The Company established a defined contribution plan (the “401(k) Plan”) to provide retirement benefits for employees that meet minimum employment criteria. The Operating Partnership, on behalf of the Company, matches dollar for dollar up to the first 3% of eligible compensation that a participant contributes to the 401(k) Plan (2% for 2004). Participants are vested in the Company’s contributions over five years. The Operating Partnership, on behalf of the Company, made contributions in the amount of $3.5 million and $1.7 million for the years ended December 31, 2005 and 2004, respectively, and expects to make contributions in the amount of approximately $3.0 million for the year ended December 31, 2006.

The Operating Partnership, on behalf of 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 Operating Partnership, on behalf of the Company, expects to make contributions in the amount of approximately $3.4 million for the year ended December 31, 2006. The Operating Partnership, on behalf of the Company, made contributions of approximately $2.6 million for the year ended December 31, 2005 and did not make a contribution for the year ended December 31, 2004.

The Company established a supplemental executive retirement plan (the “SERP”) to provide certain officers and EQR trustees an opportunity to defer a portion of their eligible compensation in order to save for retirement. The SERP is restricted to investments in EQR 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 Operating Partnership and carried on the Operating Partnership’s balance sheet, and the Company’s Common Shares held in the SERP are accounted for as a reduction to General Partners’ capital.

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16.Distribution Reinvestment and Share Purchase Plan

On November 3, 1997, the Company filed with the SEC a Form S-3 Registration Statement to register 14,000,000 Common Shares pursuant to a Distribution Reinvestment and Share Purchase Plan (the “DRIP Plan”). The registration statement was declared effective on November 25, 1997. The Company has 11,571,277 Common Shares available for issuance under the DRIP Plan at December 31, 2006.

The DRIP Plan provides holders of record and beneficial owners of Common Shares and Preferred Shares with a simple and convenient method of investing cash distributions in additional Common Shares (which is referred to herein as the “Dividend Reinvestment – DRIP Plan”). Common Shares may also be purchased on a monthly basis with optional cash payments made by participants in the DRIP Plan and interested new investors, not currently shareholders of EQR, 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 is referred to herein as the “Share Purchase – DRIP Plan”). Common Shares purchased under the DRIP Plan may, at the option of EQR, be directly issued by EQR or purchased by EQR’s transfer agent in the open market using participants’ funds. The net proceeds from any Common Share issuances are contributed to the Operating Partnership in exchange for OP Units.

17.Transactions with Related Parties

Pursuant to the terms of the partnership agreement for the Operating Partnership, the Operating Partnership is required to reimburse EQR for all expenses incurred by EQR in excess of income earned by EQR through its indirect 1% ownership of various entities. Amounts paid on behalf of EQR are reflected in the consolidated statements of operations as general and administrative expenses.

The Operating Partnership provided asset and property management services to certain related entities for properties not owned by the Operating Partnership. Fees received for providing such services were approximately $0.3 million, $0.2 million and $0.2 million for the years ended December 31, 2006, 2005 and 2004, respectively.

The Operating Partnership leases its corporate headquarters from an entity controlled by EQR’s Chairman of the Board of Trustees. The lease terminates on July 31, 2011. Amounts incurred for such office space for the years ended December 31, 2006, 2005 and 2004, respectively, were approximately $2.8 million, $2.1 million and $1.9 million. The Operating Partnership believes these amounts equal market rates for such space.

The Operating Partnership had the following additional non-continuing related party transactions:

•The Operating Partnership reimbursed EQR’s Chief Operating Officer for the actual operating costs (excluding acquisition costs) of operating his personal aircraft for himself and other employees on Operating Partnership business in 2005 and 2004. Amounts incurred were approximately $0.4 million and $0.3 million for the years ended December 31, 2005 and 2004, respectively.

•The Operating Partnership leased space in an office building in Augusta, Georgia indirectly owned by one of EQR’s former trustees since May 2003 and directly owned by an entity affiliated with the same EQR trustee from 1998 to 2003 (individual was a trustee through May 2004). Approximately $0.2 million was incurred for such office space for the year ended December 31, 2004.

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18.Commitments and Contingencies

The Operating Partnership, as an owner of real estate, is subject to various Federal, state and local environmental laws. Compliance by the Operating Partnership with existing laws has not had a material adverse effect on the Operating Partnership. However, the Operating Partnership cannot predict the impact of new or changed laws or regulations on its current properties or on properties that it may acquire in the future.

The Operating Partnership is party to a housing discrimination lawsuit brought by a non-profit civil rights organization in April 2006 in the U.S. District Court for the District of Maryland. The suit alleges that the Operating Partnership designed and built approximately 300 of its properties in violation of the accessibility requirements of the Fair Housing Act and Americans With Disabilities Act. The suit seeks actual and punitive damages, injunctive relief (including modification of non-compliant properties), costs and attorneys’ fees. The Operating Partnership believes it has a number of viable defenses, including that a majority of the named properties were completed before the operative dates of the statutes in question and/or were not designed or built by the Operating Partnership. Accordingly, the Operating Partnership is defending the suit vigorously. Due to the pendency of the Operating Partnership’s defenses and the uncertainty of many other critical factual and legal issues, it is not possible to determine or predict the outcome of the suit and as a result, no amounts have been accrued at December 31, 2006. While no assurances can be given, the Operating Partnership does not believe that the suit, if adversely determined, would have a material adverse effect on the Operating Partnership.

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

During the years ended December 31, 2005 and 2004, the Operating Partnership established a reserve and recorded a corresponding expense, net of insurance receivables, for estimated uninsured property damage at certain of its properties caused by various hurricanes in each respective year. During the year ended December 31, 2006, the Operating Partnership received $12.1 million in insurance proceeds and recorded an additional $6.2 million of receivables in anticipation of proceeds expected. As of December 31, 2006, a receivable of $5.1 million and a liability of $3.2 million are included in other assets and rents received in advance and other liabilities, respectively, on the consolidated balance sheets.

As of December 31, 2006, the Operating Partnership has eleven projects totaling 3,448 units in various stages of development with estimated completion dates ranging through June 30, 2009. The primary development agreements currently in place have the following key terms:

•The first development partner has the right, at any time following completion of a project, to stipulate a value for such project and offer to sell its interest in the project to the Operating Partnership based on such value. If the Operating Partnership chooses not to purchase the interest, the Operating Partnership must agree to a sale of the project to an unrelated third party at such value. The Operating Partnership’s partner must exercise this right as to all projects subject to the agreement within five years after the receipt of the final certificate of occupancy on the last developed property.

•The second development partner has the right, at any time following completion of a project, to require the Operating Partnership to purchase the partner’s interest in that project at a mutually agreeable price. If the Operating Partnership 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 Operating Partnership and its partner will agree on a third appraiser to determine which original appraisal is closest to its determination of value. The Operating Partnership 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 Operating Partnership must purchase, at the agreed-upon price, any projects remaining unsold.

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•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 Operating Partnership or its development partner may market a subject project for sale. If the Operating Partnership’s development partner proposes the sale, the Operating Partnership 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 Operating Partnership may elect to purchase the property or authorize its development partner to sell the project at the agreed-upon value.

In addition, the Operating Partnership has various deal-specific development agreements with partners, the overall terms of which are similar in nature to those described above.

The Operating Partnership’s guaranty of a credit enhancement agreement with respect to certain tax-exempt bonds issued to finance certain public improvements at a multifamily development project was terminated effective May 2, 2005 as the tax-exempt bonds were redeemed in full and the associated letter of credit was cancelled.

During the years ended December 31, 2006, 2005 and 2004, total operating lease payments incurred for office space, including a portion of real estate taxes, insurance, repairs and utilities, aggregated $6.7 million, $6.1 million and $5.8 million, respectively.

The Company has entered into a retirement benefits agreement with its Chairman of the Board of Trustees and deferred compensation agreements with its chief operating officer and two former chief executive officers. During the years ended December 31, 2006, 2005 and 2004, the Operating Partnership recognized compensation expense of $1.1 million, $2.2 million and $39,000, respectively, related to these agreements.

The following table summarizes the Operating Partnership’s contractual obligations for minimum rent payments under operating leases and deferred compensation for the next five years and thereafter as of December 31, 2006:

	Payments Due by Year (in thousands)
	2007		2008		2009		2010		2011		Thereafter		Total
Operating Leases:
Minimum Rent Payments (a)	$	5,443	$	5,302	$	4,709	$	4,119	$	2,416	$	2,963	$	24,952
Other Long-Term Liabilities:
Deferred Compensation (b)	813		813		1,450		1,450		2,049		14,736		21,311

(a)Minimum basic rent due for various office space the Operating Partnership leases and fixed base rent due on a ground lease for one property.

(b)Estimated payments to EQR’s Chairman, two former CEO’s and its chief operating officer based on planned retirement dates.

19.Impairment

The Operating Partnership recorded approximately $30.0 million of asset impairment charges related to its write-down of the entire carrying value of the goodwill on its corporate housing business during the year ended December 31, 2006. Following the guidance in SFAS No. 142, this charge was the result of the continued poor operating performance of the corporate housing business and management’s expectations for future performance. This charge is reflected on the consolidated statements of operations as impairment.

The Operating Partnership also took an impairment charge of $2.0 million related to the write-off of various deferred sales costs following the decision to halt the condominium conversion and sale process at

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five assets. The remaining $2.0 million of impairment losses in 2006 along with the $0.6 million and $1.5 million of losses in 2005 and 2004, respectively, represent the write-off of various pursuit and out-of-pocket costs for terminated acquisition, disposition and development transactions.

20.Reportable Segments

Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by senior management. Senior management decides how resources are allocated and assesses performance on a monthly basis.

The Operating Partnership’s primary business is owning, managing, and operating multifamily residential properties, which includes the generation of rental and other related income through the leasing of apartment units to residents. Senior management evaluates the performance of each of our apartment communities individually and geographically, and both on a same store and non-same store basis; however, each of our apartment communities generally has similar economic characteristics, residents, products and services. The Operating Partnership’s operating segments have been aggregated by geography in a manner identical to that which is provided to its chief operating decision maker.

The Operating Partnership’s fee and asset management, development (including FIN No. 46 partially owned properties), condominium conversion and corporate housing (Equity Corporate Housing or “ECH”) activities are immaterial and do not individually meet the threshold requirements of a reportable segment as provided for in SFAS No. 131 and as such, have been aggregated in the tables presented below.

All revenues are from external customers and there is no customer who contributed 10% or more of the Operating Partnership’s total revenues during the three years ended December 31, 2006, 2005, or 2004.

The primary financial measure for the Operating Partnership’s rental real estate properties is net operating income (“NOI”), which represents rental income less:  1) property and maintenance expense; 2) real estate taxes and insurance expense; and 3) property management expense (all as reflected in the accompanying statements of operations). The Operating Partnership 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 Operating Partnership’s apartment communities. Current year NOI is compared to prior year NOI and current year budgeted NOI as a measure of financial performance. The following table presents NOI for each segment from our rental real estate specific to continuing operations as well as total assets for the years ended December 31, 2006, and 2005, respectively (amounts in thousands):

F-40

	Year Ended December 31, 2006
	Northeast		South		West		Other (3)			Total
Rental income:
Same store (1)	$	424,292	$	611,636	$	576,601	$	—		$	1,612,529
Non-same store/other (2) (3)	126,535		79,383		76,524		86,364			368,806
Properties sold – June YTD 2007 (4)	—		—		—		(93,038		)	(93,038		)
Total rental income	550,827		691,019		653,125		(6,674		)	1,888,297
Operating expenses:
Same store (1)	164,050		259,789		204,371		—			628,210
Non-same store/other (2) (3)	49,781		32,528		28,869		83,765			194,943
Properties sold – June YTD 2007 (4)	—		—		—		(41,250		)	(41,250		)
Total operating expenses	213,831		292,317		233,240		42,515			781,903
NOI:
Same store (1)	260,242		351,847		372,230		—			984,319
Non-same store/other (2) (3)	76,754		46,855		47,655		2,599			173,863
Properties sold – June YTD 2007 (4)	—		—		—		(51,788		)	(51,788		)
Total NOI	$	336,996	$	398,702	$	419,885	$	(49,189	)	$	1,106,394
Total assets	$	4,465,461	$	4,316,252	$	4,507,019	$	1,773,487		$	15,062,219

(1)  Same store includes properties owned for all of both 2006 and 2005 which represented 128,133 units.

(2)  Non-same store includes properties acquired after January 1, 2005.

(3)  Other includes ECH, development, condominium conversion overhead of $5.9 million and other corporate operations. Also reflects $15.8 million elimination of rental income recorded in Northeast, South and West operating segments related to ECH.

(4)  Properties sold – June YTD 2007 reflects discontinued operations for properties sold during the first six months of 2007.

	Year Ended December 31, 2005
	Northeast		South		West		Other (3)			Total
Rental income:
Same store (1)	$	405,983	$	571,485	$	546,390	$	—		$	1,523,858
Non-same store/other (2) (3)	32,478		21,006		22,677		72,399			148,560
Properties sold – June YTD 2007 (4)	—		—		—		(82,957		)	(82,957		)
Total rental income	438,461		592,491		569,067		(10,558		)	1,589,461
Operating expenses:
Same store (1)	157,065		250,989		196,264		—			604,318
Non-same store/other (2) (3)	13,737		7,784		8,868		95,320			125,709
Properties sold – June YTD 2007 (4)	—		—		—		(39,769		)	(39,769		)
Total operating expenses	170,802		258,773		205,132		55,551			690,258
NOI:
Same store (1)	248,918		320,496		350,126		—			919,540
Non-same store/other (2) (3)	18,741		13,222		13,809		(22,921		)	22,851
Properties sold – June YTD 2007 (4)	—		—		—		(43,188		)	(43,188		)
Total NOI	$	267,659	$	333,718	$	363,935	$	(66,109	)	$	899,203
Total assets	$	4,056,535	$	3,829,466	$	3,977,377	$	2,245,373		$	14,108,751

(1)  Same store includes properties owned for all of both 2006 and 2005 which represented 128,133 units.

(2)  Non-same store includes properties acquired after January 1, 2005.

(3)  Other includes ECH, development, condominium conversion overhead of $3.1 million and other corporate operations. Also reflects $13.4 million elimination of rental income recorded in Northeast, South and West operating segments related to ECH and $11.1 million of hurricane insurance losses.

(4)  Properties sold – June YTD 2007 reflects discontinued operations for properties sold during the first six months of 2007.

F-41

Note:  Markets included in the above geographic segments are as follows:

(a)	Northeast – New England (excl Boston), Boston, New York Metro, DC Northern Virginia, Suburban Maryland, Chicago, Milwaukee and Minneapolis/St. Paul.
(b)	South – Charlotte, Raleigh/Durham, Atlanta, Jacksonville, Orlando, Tampa/Ft. Myers, South Florida, Nashville, Tulsa, Austin, Houston, Dallas/Ft. Worth, Albuquerque and Phoenix.
(c)	West – Seattle/Tacoma, Portland, Central Valley, San Francisco Bay Area, Inland Empire, Los Angeles, Orange County, San Diego and Denver.

The following table presents a reconciliation of NOI from our rental real estate specific to continuing operations for the years ended December 31, 2006, 2005 and 2004, respectively:

	Year Ended December 31,
	2006			2005			2004
	(Amounts in thousands)
Rental income	$	1,888,297		$	1,589,461		$	1,400,355
Property and maintenance expense	(500,074		)	(424,858		)	(367,371		)
Real estate taxes and insurance expense	(185,651		)	(178,527		)	(162,787		)
Property management expense	(96,178		)	(86,873		)	(76,615		)
Total operating expenses	(781,903		)	(690,258		)	(606,773		)
Net operating income	$	1,106,394		$	899,203		$	793,582

21.Subsequent Events/Other

Subsequent to December 31, 2006 and through February 7, 2007, the Operating Partnership:

•Acquired $536.5 million of apartment properties consisting of nine properties and 2,905 units;

•Sold one residential property consisting of 280 units for $14.4 million (excluding condominium units); and

•Repaid $115.3 million of mortgage loans.

During the years ended December 31, 2006 and 2005, the Operating Partnership received proceeds from technology and other investments of $4.0 million and $82.1 million, respectively, from the following:

•$25.0 million in full redemption of 1,000,000 shares of Wellsford 8.25% Convertible Trust Preferred Securities during 2005;

•$3.7 million and $57.1 million for its ownership interest in Rent.com in connection with the acquisition of Rent.com by eBay, Inc. in 2006 and 2005, respectively. Both amounts were recorded as interest and other income in the accompanying consolidated statements of operations; and

•$0.3 million as a partial distribution for its ownership interest in Constellation Real Technologies, LLC in 2006. The amount was recorded as interest and other income.

During 2006, the Operating Partnership recognized $14.7 million of forfeited deposits for various terminated transactions, included in interest and other income.

During the fourth quarter of 2006, the Operating Partnership established a reserve of $6.2 million related to potential liabilities associated with certain asset sales. While no assurances can be given, the Operating Partnership does not believe that the potential issue, if adversely determined or settled, will have a material adverse effect on the Operating Partnership.

On March 28, 2005, the Company and Bruce W. Duncan, EQR’s former Chief Executive Officer

F-42

(“CEO”), entered into an Amended and Restated Employment Agreement (as further amended effective June 30, 2005, the “Amendment”) to reflect changes required in view of Mr. Duncan’s retirement as CEO and trustee effective December 31, 2005. The Amendment also amended Mr. Duncan’s Deferred Compensation Agreement entered into in January 2003. The Company recorded approximately $11.2 million of additional general and administrative expense during the year ended December 31, 2005, primarily related to accelerated vesting of share options and restricted/performance shares.

Effective February 28, 2005, the Company and Edward Geraghty, the President of the Company’s Eastern Division, entered into a Separation Agreement and General Release reflecting Mr. Geraghty’s resignation effective February 28, 2005. The Company recorded approximately $3.3 million of severance as additional general and administrative expense during the quarter ended March 31, 2005.

22.Quarterly Financial Data (Unaudited)

The following unaudited quarterly data has been prepared on the basis of a December 31 year-end. All amounts have also been restated in accordance with the discontinued operations provisions of SFAS No. 144 and reflect dispositions and/or properties held for sale through June 30, 2007. Amounts are in thousands, except for per OP Unit amounts.

2006	Fourth Quarter 12/31		Third Quarter 9/30		Second Quarter 6/30		First Quarter 3/31
Total revenues (1)	$	494,355	$	487,994	$	467,533	$	447,516
Operating income (1)	97,494		132,206		133,995		121,644
Income from continuing operations (1)	6,218		30,686		30,594		19,201
Discontinued operations, net (1)	491,147		43,343		140,568		386,347
Net income *	497,365		74,029		171,162		405,548
Net income available to OP Units	489,687		60,350		160,623		393,680
Earnings per OP Unit – basic:
Net income available to OP Units	$	1.57	$	0.19	$	0.52	$	1.27
Weighted average OP Units outstanding	311,757		310,671		310,017		309,334
Earnings per OP Unit – diluted:
Net income available to OP Units	$	1.54	$	0.19	$	0.51	$	1.25
Weighted average OP Units outstanding	317,076		315,886		314,698		314,049

(1)The amounts presented for 2006 are not equal to the same amounts previously reported in the Form 8-K filed with the SEC on May 23, 2007 as a result of changes in discontinued operations due to additional property sales which occurred throughout the first six months of 2007. Below is a reconciliation to the amounts previously reported in the Form 8-K:

F-43

2006	Fourth Quarter 12/31			Third Quarter 9/30			Second Quarter 6/30			First Quarter 3/31
Total revenues previously reported in May 2007 Form 8-K	$	509,758		$	503,346		$	482,565		$	462,458
Total revenues subsequently reclassified to discontinued operations	(15,403		)	(15,352		)	(15,032		)	(14,942		)
Total revenues disclosed in Form 8-K	$	494,355		$	487,994		$	467,533		$	447,516
Operating income previously reported in May 2007 Form 8-K	$	102,556		$	137,342		$	138,609		$	126,234
Operating income subsequently reclassified to discontinued operations	(5,062		)	(5,136		)	(4,614		)	(4,590		)
Operating income disclosed in Form 8-K	$	97,494		$	132,206		$	133,995		$	121,644
Income from continuing operations previously reported in May 2007 Form 8-K	$	10,610		$	35,164		$	34,647		$	19,871
Income from continuing operations subsequently reclassified to discontinued operations	(4,392		)	(4,478		)	(4,053		)	(670		)
Income from continuing operations disclosed in Form 8-K	$	6,218		$	30,686		$	30,594		$	19,201
Discontinued operations, net previously reported in May 2007 Form 8-K	$	486,755		$	38,865		$	136,515		$	385,677
Discontinued operations, net from properties sold subsequent to the respective reporting period	4,392			4,478			4,053			670
Discontinued operations, net disclosed in Form 8-K	$	491,147		$	43,343		$	140,568		$	386,347

2005	Fourth Quarter 12/31		Third Quarter 9/30		Second Quarter 6/30		First Quarter 3/31
Total revenues (2)	$	428,058	$	405,937	$	390,888	$	374,818
Operating income (2)	100,394		103,256		110,292		98,227
Income from continuing operations (2)	28,911		12,091		25,228		85,513
Discontinued operations, net (2)	213,593		274,696		129,248		162,767
Net income *	242,504		286,787		154,476		248,280
Net income available to OP Units	230,659		268,325		137,683		229,639
Earnings per OP Unit – basic:
Net income available to OP Units	$	0.75	$	0.87	$	0.45	$	0.75
Weighted average OP Units outstanding	307,792		306,915		306,190		305,391
Earnings per OP Unit – diluted:
Net income available to OP Units	$	0.74	$	0.87	$	0.44	$	0.74
Weighted average OP Units outstanding	312,408		306,915		309,979		308,576

(2)The amounts presented for 2005 are not equal to the same amounts previously reported in the Form 8-K filed with the SEC on May 23, 2007 as a result of changes in discontinued operations due to additional property sales which occurred throughout the first six months of 2007. Below is a reconciliation to the amounts previously reported in the Form 8-K:

F-44

2005	Fourth Quarter 12/31			Third Quarter 9/30			Second Quarter 6/30			First Quarter 3/31
Total revenues previously reported in May 2007 Form 8-K	$	442,822		$	420,512		$	405,105		$	388,920
Total revenues subsequently reclassified to discontinued operations	(14,764		)	(14,575		)	(14,217		)	(14,102		)
Total revenues disclosed in Form 8-K	$	428,058		$	405,937		$	390,888		$	374,818
Operating income previously reported in May 2007 Form 8-K	$	105,108		$	107,193		$	114,099		$	102,405
Operating income subsequently reclassified to discontinued operations	(4,714		)	(3,937		)	(3,807		)	(4,178		)
Operating income disclosed in Form 8-K	$	100,394		$	103,256		$	110,292		$	98,227
Income from continuing operations previously reported in May 2007 Form 8-K	$	32,128		$	14,643		$	27,514		$	88,270
Income from continuing operations subsequently reclassified to discontinued operations	(3,217		)	(2,552		)	(2,286		)	(2,757		)
Income from continuing operations disclosed in Form 8-K	$	28,911		$	12,091		$	25,228		$	85,513
Discontinued operations, net previously reported in May 2007 Form 8-K	$	210,376		$	272,144		$	126,962		$	160,010
Discontinued operations, net from properties sold subsequent to the respective reporting period	3,217			2,552			2,286			2,757
Discontinued operations, net disclosed in Form 8-K	$	213,593		$	274,696		$	129,248		$	162,767

* The Operating Partnership did not have any extraordinary items or cumulative effect of change in accounting principle during the years ended December 31, 2006 and 2005. Therefore, income before extraordinary items and cumulative effect of change in accounting principle is not shown as it was equal to the net income amounts disclosed above.

F-45

ERP OPERATING LIMITED PARTNERSHIP

Schedule III - Real Estate and Accumulated Depreciation

Overall Summary

December 31, 2006

	Properties (I)	Units (I)	Investment in Real Estate, Gross		Accumulated Depreciation			Investment in Real Estate, Net		Encumbrances
Wholly Owned Unencumbered	438	97,902	$	11,453,690,644	$	(2,006,699,313	)	$	9,446,991,331	$	—
Wholly Owned Encumbered	108	48,540	5,221,601,153		(936,392,757		)	4,285,208,396		1,923,428,819
Portfolio/Entity Encumbrances (1)	—	—	—		—			—		893,451,149
Wholly Owned Properties	546	146,442	16,675,291,797		(2,943,092,070		)	13,732,199,727		2,816,879,968
Partially Owned Unencumbered	2	483	99,157,051		(7,660,504		)	91,496,547		—
Partially Owned Encumbered	23	4,390	460,726,265		(71,727,221		)	388,999,044		361,343,204
Partially Owned Properties	25	4,873	559,883,316		(79,387,725		)	480,495,591		361,343,204
Total Unencumbered Properties	440	98,385	11,552,847,695		(2,014,359,817		)	9,538,487,878		—
Total Encumbered Properties	131	52,930	5,682,327,418		(1,008,119,978		)	4,674,207,440		3,178,223,172
Total Consolidated Investment in Real Estate	571	151,315	$	17,235,175,113	$	(3,022,479,795	)	$	14,212,695,318	$	3,178,223,172

(I) See attached Encumbrances Reconciliation.

S-1

ERP OPERATING LIMITED PARTNERSHIP

Schedule III - Real Estate and Accumulated Depreciation

Encumbrances Reconciliation

December 31, 2006

Portfolio/Entity Encumbrances	Number of Properties Encumbered By		See Properties With Note:	Amount
EQR Arbors Financing LP	1		(K)	$	13,265,000
EQR-Bond Partnership	10		(L)	144,514,000
GPT-Windsor, LLC	16	*	(M)	63,000,000
EQR-Codelle, LP	10		(N)	114,553,427
EQR-Conner, LP	14		(O)	198,301,191
EQR-FANCAP 2000A LP	11		(P)	148,333,000
EQR-Fankey 2004 Ltd. Pship	8		(Q)	211,484,531
Portfolio/Entity Encumbrances				893,451,149
Individual Property Encumbrances				2,284,772,023
Total Encumbrances per Financial Statements				$	3,178,223,172

* Collateral also includes $2.7 million invested in U.S. Treasury Securities which is included in Deposits - Restricted in the accompanying consolidated balance sheets at December 31, 2006.

S-2

ERP OPERATING LIMITED PARTNERSHIP

Schedule III - Real Estate and Accumulated Depreciation

(Amounts in thousands)

The changes in total real estate for the years ended December 31, 2006, 2005 and 2004 are as follows:

	2006			2005			2004
Balance, beginning of year	$	16,590,370		$	14,852,621		$	12,874,379
Acquisitions and development	2,252,039			2,906,414			2,563,612
Improvements	265,832			250,110			218,724
Dispositions and other	(1,873,066		)	(1,418,775		)	(804,094		)
Balance, end of year	$	17,235,175		$	16,590,370		$	14,852,621

The changes in accumulated depreciation for the years ended December 31, 2006, 2005, and 2004 are as follows:

	2006			2005			2004
Balance, beginning of year	$	2,888,140		$	2,599,827		$	2,296,013
Depreciation	592,637			528,152			496,422
Dispositions and other	(458,297		)	(239,839		)	(192,608		)
Balance, end of year	$	3,022,480		$	2,888,140		$	2,599,827

S-3

ERP OPERATING LIMITED PARTNERSHIP

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2006

								Cost Capitalized
								Subsequent to					Gross Amount Carried
				Initial Cost to				Acquisition					at Close of
Description				Company				(Improvements, net) (E)					Period 12/31/06
Apartment Name	Location	Date of Construction	Units (I)	Land		Building & Fixtures		Land		Building & Fixtures			Land		Building & Fixtures (A)		Total (B)		Accumulated Depreciation (C)			Investment in Real Estate, Net at 12/31/06		Encumbrances
EQR Wholly Owned Unencumbered:
107 Lawrence	Brooklyn, NY	(F)	—	$	27,605,161	$	210,067	$	—	$	—		$	27,605,161	$	210,067	$	27,815,228	$	—		$	27,815,228	$	—
2300 Elliott	Seattle, WA	1992	92	796,800		7,173,725		—		4,498,851			796,800		11,672,576		12,469,376		(5,768,648		)	6,700,728		—
303 Third Street - Residential	Cambridge, MA	(F)	—	27,812,384		28,065,881		—		—			27,812,384		28,065,881		55,878,265		—			55,878,265		—
500 Elliott, LLC	Seattle, WA (G)	2001	8	966,158		1,625,708		—		(298,337		)	966,158		1,327,370		2,293,528		—			2,293,528		—
71 Broadway	New York, NY (G)	1997	238	22,611,600		77,491,686		—		324,536			22,611,600		77,816,223		100,427,823		(6,728,503		)	93,699,319		—
77 Hudson	Jersey City, NJ	(F)	—	28,170,659		15,650,251		—		—			28,170,659		15,650,251		43,820,910		—			43,820,910		—
420 East 80th Street	New York, NY	1961	155	39,277,000		22,976,681		—		(678		)	39,277,000		22,976,003		62,253,003		(322,377		)	61,930,626		—
600 Washington	New York, NY (G)	2004	135	32,852,000		43,140,551		—		2,030			32,852,000		43,142,581		75,994,581		(2,633,563		)	73,361,019		—
Abington Glen	Abington, MA	1968	90	553,105		3,697,396		—		1,939,825			553,105		5,637,221		6,190,327		(1,323,816		)	4,866,511		—
Acacia Creek	Scottsdale, AZ	1988-1994	304	3,663,473		21,172,386		—		1,910,460			3,663,473		23,082,847		26,746,320		(7,582,253		)	19,164,067		—
Alborada	Fremont, CA	1999	442	24,310,000		59,214,129		—		1,539,697			24,310,000		60,753,826		85,063,826		(14,438,092		)	70,625,734		—
Alexander on Ponce	Atlanta, GA	2003	330	9,900,000		35,819,022		—		401,189			9,900,000		36,220,211		46,120,211		(2,282,467		)	43,837,744		—
Alexandria at Lake Buena Vista	Orlando, FL	2000	336	11,760,000		40,542,177		—		1,045,771			11,760,000		41,587,948		53,347,948		(2,390,411		)	50,957,537		—
Arbors of Brentwood	Nashville, TN	1986	346	404,670		13,535,919		—		4,185,885			404,670		17,721,804		18,126,474		(8,395,734		)	9,730,740		—
Ashley Park at Brier Creek	Raleigh, NC	2002	374	5,610,000		31,467,489		—		1,635,301			5,610,000		33,102,790		38,712,790		(2,789,282		)	35,923,509		—
Ashton, The	Corona Hills, CA	1986	492	2,594,264		33,042,398		—		3,935,511			2,594,264		36,977,909		39,572,173		(12,206,098		)	27,366,075		—
Aspen Crossing	Silver Spring, MD	1979	192	2,880,000		8,551,377		—		2,586,168			2,880,000		11,137,546		14,017,546		(3,534,475		)	10,483,071		—
Audubon Village	Tampa, FL	1990	447	3,576,000		26,121,909		—		2,029,250			3,576,000		28,151,159		31,727,159		(8,490,754		)	23,236,405		—
Auvers Village	Orlando, FL	1991	480	3,840,000		29,322,243		—		2,602,927			3,840,000		31,925,170		35,765,170		(9,903,937		)	25,861,234		—
Avenue Royale	Jacksonville, FL	2001	200	5,000,000		17,785,388		—		391,054			5,000,000		18,176,442		23,176,442		(1,476,970		)	21,699,472		—
Azure Creek at Tatum Ranch	Phoenix, AZ	2001	160	8,778,000		17,840,790		—		409,690			8,778,000		18,250,480		27,028,480		(714,342		)	26,314,139		—
Balcones Club	Austin, TX	1984	312	2,185,500		10,119,232		—		2,799,645			2,185,500		12,918,877		15,104,377		(4,782,660		)	10,321,717		—
Barrington Place	Oviedo, FL	1998	233	6,990,000		15,740,374		—		126,688			6,990,000		15,867,062		22,857,062		(700,171		)	22,156,890		—
Bay Ridge	San Pedro, CA	1987	60	2,401,300		2,176,963		—		583,314			2,401,300		2,760,277		5,161,577		(1,053,383		)	4,108,194		—
Bayside at the Islands	Gilbert, AZ	1989	272	3,306,484		15,573,006		—		2,050,029			3,306,484		17,623,035		20,929,519		(6,016,204		)	14,913,315		—
Bell Road I & II	Nashville, TN	(F)	—	3,100,000		1,120,214		—		—			3,100,000		1,120,214		4,220,214		—			4,220,214		—
Bella Vista I & II	Los Angeles, CA	2003	315	16,883,410		61,671,977		—		529,479			16,883,410		62,201,456		79,084,866		(6,719,808		)	72,365,058		—
Bella Vista III	Los Angeles, CA	(F)	—	14,799,344		44,882,173		—		—			14,799,344		44,882,173		59,681,518		—			59,681,518		—
Bella Vista	Phoenix, AZ	1995	248	2,978,879		20,641,333		—		2,769,148			2,978,879		23,410,482		26,389,361		(7,013,886		)	19,375,474		—
Bellagio Apartment Homes	Scottsdale, AZ	1995	202	2,626,000		16,025,041		—		552,328			2,626,000		16,577,369		19,203,369		(1,690,463		)	17,512,906		—
Belle Arts Condominium Homes, LLC	Bellevue, WA	2000	128	5,678,370		24,655,908		—		46,857			5,678,370		24,702,764		30,381,134		—			30,381,134		—
Bellevue Meadows	Bellevue, WA	1983	180	4,507,100		12,574,814		—		2,338,278			4,507,100		14,913,093		19,420,193		(4,212,491		)	15,207,702		—
Beneva Place	Sarasota, FL	1986	192	1,344,000		9,665,447		—		1,211,761			1,344,000		10,877,208		12,221,208		(3,313,743		)	8,907,465		—
Bermuda Cove	Jacksonville, FL	1989	350	1,503,000		19,561,896		—		3,594,399			1,503,000		23,156,295		24,659,295		(6,975,137		)	17,684,158		—
Bishop Park	Winter Park, FL	1991	324	2,592,000		17,990,436		—		2,759,444			2,592,000		20,749,880		23,341,880		(6,771,015		)	16,570,865		—
Braewood, LLC	Bothell, WA	1999/2000	2	57,582		239,610		—		29,813			57,582		269,423		327,005		—			327,005		—
Bramblewood	San Jose, CA	1986	108	5,190,700		9,659,184		—		653,840			5,190,700		10,313,025		15,503,725		(3,180,360		)	12,323,364		—
Brentwood	Vancouver, WA	1990	296	1,357,221		12,202,521		—		2,062,577			1,357,221		14,265,098		15,622,320		(6,293,490		)	9,328,830		—
Breton Mill	Houston, TX	1986	392	212,820		8,547,263		—		1,990,798			212,820		10,538,061		10,750,881		(5,241,611		)	5,509,270		—
Bridford Lakes II	Greensboro, NC	(F)	—	1,100,564		792,509		—		—			1,100,564		792,509		1,893,073		—			1,893,073		—
Bridgeport	Raleigh, NC	1990	276	1,296,700		11,666,278		—		1,541,285			1,296,700		13,207,564		14,504,264		(6,427,922		)	8,076,341		—
Bridgewater at Wells Crossing	Orange Park, FL	1986	288	2,160,000		13,347,549		—		1,221,537			2,160,000		14,569,086		16,729,086		(4,041,899		)	12,687,186		—
Broadway	Garland, TX	1983	288	1,443,700		7,790,989		—		2,100,689			1,443,700		9,891,678		11,335,378		(3,722,784		)	7,612,594		—
Brookside (CO)	Boulder, CO	1993	144	3,600,400		10,211,159		—		619,154			3,600,400		10,830,313		14,430,713		(3,356,877		)	11,073,836		—
Brookside II (MD)	Frederick, MD	1979	204	2,450,800		6,913,202		—		1,955,989			2,450,800		8,869,191		11,319,991		(3,086,573		)	8,233,419		—
Cambridge at Hickory Hollow	Antioch, TN	1997	360	3,240,800		17,900,033		—		1,342,665			3,240,800		19,242,698		22,483,498		(6,648,883		)	15,834,615		—
Cambridge Estates	Norwich, CT	1977	92	590,185		3,945,265		—		404,392			590,185		4,349,657		4,939,842		(1,046,975		)	3,892,867		—
Camellero	Scottsdale, AZ	1979	348	1,924,900		17,324,593		—		4,779,600			1,924,900		22,104,193		24,029,093		(10,449,088		)	13,580,005		—
Canyon Crest	Santa Clarita, CA	1993	158	2,370,000		10,141,878		—		1,606,610			2,370,000		11,748,489		14,118,489		(3,332,190		)	10,786,298		—
Canyon Ridge	San Diego, CA	1989	162	4,869,448		11,955,064		—		1,172,039			4,869,448		13,127,103		17,996,551		(4,336,837		)	13,659,713		—
Carlyle Mill	Alexandria, VA	2002	317	10,000,000		51,368,058		—		2,810,598			10,000,000		54,178,657		64,178,657		(6,908,594		)	57,270,062		—
Carmel Terrace	San Diego, CA	1988-89	384	2,288,300		20,596,281		—		5,595,116			2,288,300		26,191,397		28,479,697		(10,034,342		)	18,445,355		—
Casa Capricorn	San Diego, CA	1981	192	1,262,700		11,365,093		—		2,471,705			1,262,700		13,836,799		15,099,499		(5,213,614		)	9,885,885		—
Casa Ruiz	San Diego, CA	1976-1986	196	3,922,400		9,389,153		—		2,384,821			3,922,400		11,773,975		15,696,375		(4,165,558		)	11,530,817		—
Cascade at Landmark	Alexandria, VA	1990	277	3,603,400		19,657,554		—		3,143,091			3,603,400		22,800,644		26,404,044		(8,144,168		)	18,259,876		—
CenterPointe	Beaverton, OR	1996	264	3,421,535		15,708,853		—		2,223,580			3,421,535		17,932,433		21,353,968		(3,907,448		)	17,446,520		—
Centre Club	Ontario, CA	1994	312	5,616,000		23,485,891		—		1,510,601			5,616,000		24,996,492		30,612,492		(5,869,598		)	24,742,894		—
Centre Club II	Ontario, CA	2002	100	1,820,000		9,528,898		—		204,951			1,820,000		9,733,849		11,553,849		(1,690,078		)	9,863,771		—
Champion Oaks	Houston, TX	1984	252	931,900		8,389,394		—		1,843,161			931,900		10,232,555		11,164,455		(4,716,988		)	6,447,467		—
Chandler Court	Chandler, AZ	1987	312	1,353,100		12,175,173		—		3,052,915			1,353,100		15,228,087		16,581,187		(6,692,817		)	9,888,370		—
Chantecleer Lakes Condominium Homes	Naperville, IL	1986	98	2,198,362		5,409,097		—		1,576,810			2,198,362		6,985,907		9,184,269		(1,835,502		)	7,348,767		—
Chatelaine Park	Duluth, GA	1995	303	1,818,000		24,489,671		—		1,037,802			1,818,000		25,527,473		27,345,473		(7,511,459		)	19,834,014		—
Chelsea Square	Redmond, WA	1991	113	3,397,100		9,289,074		—		503,639			3,397,100		9,792,713		13,189,813		(3,037,454		)	10,152,360		—
Chestnut Hills	Puyallup, WA	1991	157	756,300		6,806,635		—		995,919			756,300		7,802,554		8,558,854		(2,913,367		)	5,645,486		—
Chinatown Gateway (Land)	Los Angeles, CA	(F)	—	13,191,831		3,991,333		—		—			13,191,831		3,991,333		17,183,164		—			17,183,164		—
Cimarron Ridge	Aurora, CO	1984	296	1,591,100		14,320,031		—		2,545,944			1,591,100		16,865,975		18,457,075		(6,598,783		)	11,858,292		—
City View (GA)	Atlanta, GA (G)	2003	202	6,440,800		19,992,518		—		632,851			6,440,800		20,625,369		27,066,169		(1,708,955		)	25,357,214		—
Clarion	Decatur, GA	1990	217	1,504,300		13,537,919		—		1,508,419			1,504,300		15,046,339		16,550,639		(4,999,128		)	11,551,511		—
Clarys Crossing	Columbia, MD	1984	198	891,000		15,489,721		—		1,543,279			891,000		17,033,000		17,924,000		(5,209,534		)	12,714,465		—
Club at the Green	Beaverton, OR	1991	254	2,030,950		12,616,747		—		1,967,019			2,030,950		14,583,766		16,614,716		(5,483,038		)	11,131,679		—
Coach Lantern	Scarborough, ME	1971/1981	90	452,900		4,405,723		—		794,424			452,900		5,200,147		5,653,047		(1,766,626		)	3,886,421		—
Coachman Trails	Plymouth, MN	1987	154	1,227,000		9,517,381		—		1,029,605			1,227,000		10,546,986		11,773,986		(3,457,671		)	8,316,315		—
Coconut Palm Club	Coconut Creek, GA	1992	300	3,001,700		17,678,928		—		1,476,372			3,001,700		19,155,300		22,157,000		(6,129,308		)	16,027,692		—
Colinas Pointe	Denver, CO	1986	272	1,587,400		14,285,902		—		1,463,344			1,587,400		15,749,246		17,336,646		(5,605,917		)	11,730,729		—
Collier Ridge	Atlanta, GA	1980	300	5,100,000		20,425,822		—		4,033,049			5,100,000		24,458,871		29,558,871		(7,419,956		)	22,138,915		—
Colorado Pointe	Denver, CO	2006	193	5,790,000		28,815,766		—		58,843			5,790,000		28,874,609		34,664,609		(716,602		)	33,948,007		—
Copper Canyon	Highlands Ranch, CO	1999	222	1,443,000		16,251,114		—		793,560			1,443,000		17,044,673		18,487,673		(4,703,098		)	13,784,575		—
Copper Creek	Tempe, AZ	1984	144	1,017,400		9,148,068		—		1,255,555			1,017,400		10,403,623		11,421,023		(3,772,096		)	7,648,926		—
Copper Terrace	Orlando, FL	1989	300	1,200,000		17,887,868		—		2,648,075			1,200,000		20,535,943		21,735,943		(6,269,942		)	15,466,001		—
Cortona at Dana Park	Mesa, AZ	1986	222	2,028,939		12,466,128		—		1,671,892			2,028,939		14,138,020		16,166,959		(4,898,170		)	11,268,789		—
Country Brook	Chandler, AZ	1986-1996	396	1,505,219		29,542,535		—		2,370,420			1,505,219		31,912,955		33,418,174		(10,347,720		)	23,070,454		—
Country Gables	Beaverton, OR	1991	288	1,580,500		14,215,444		—		2,819,737			1,580,500		17,035,181		18,615,681		(6,510,077		)	12,105,603		—
Cove at Boynton Beach I	Boynton Beach, FL	1996	252	12,600,000		31,590,391		—		332,720			12,600,000		31,923,111		44,523,111		(2,251,184		)	42,271,927		—
Cove at Boynton Beach II	Boynton Beach, FL	1998	296	14,800,000		37,874,719		—		—			14,800,000		37,874,719		52,674,719		(2,646,714		)	50,028,005		—
Cove at Fishers Landing	Vancouver, WA	1993	253	2,277,000		15,656,887		—		700,518			2,277,000		16,357,405		18,634,405		(3,138,452		)	15,495,953		—
Creekside Village	Mountlake Terrace, WA	1987	512	2,807,600		25,270,594		—		3,299,425			2,807,600		28,570,019		31,377,619		(12,817,564		)	18,560,055		—
Creekwood	Charlotte, NC	1987-1990	384	1,861,700		16,740,569		—		2,145,322			1,861,700		18,885,890		20,747,590		(6,669,019		)	14,078,571		—
Crescent at Cherry Creek	Denver, CO	1994	216	2,594,000		15,149,470		—		1,076,462			2,594,000		16,225,932		18,819,932		(5,424,098		)	13,395,834		—
Crosswinds	St. Petersburg, FL	1986	208	1,561,200		5,756,822		—		1,552,636			1,561,200		7,309,457		8,870,657		(2,850,054		)	6,020,603		—
Crowntree Lakes	Orlando, FL	(F)	—	12,009,630		206,669		—		—			12,009,630		206,669		12,216,299		—			12,216,299		—
Crystal Village	Attleboro, MA	1974	91	1,369,000		4,989,028		—		2,177,092			1,369,000		7,166,120		8,535,120		(2,507,884		)	6,027,236		—
Cypress Lake at Waterford	Orlando, Fl	2001	316	7,000,000		27,654,816		—		773,349			7,000,000		28,428,165		35,428,165		(3,229,623		)	32,198,542		—

S - 4

ERP OPERATING LIMITED PARTNERSHIP

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2006

						Cost Capitalized
						Subsequent to			Gross Amount Carried
				Initial Cost to		Acquisition			at Close of
Description				Company		(Improvements, net) (E)			Period 12/31/06
Apartment Name	Location	Date of Construction	Units (I)	Land	Building & Fixtures	Land	Building & Fixtures		Land	Building & Fixtures (A)	Total (B)	Accumulated Depreciation (C)		Investment in Real Estate, Net at 12/31/06	Encumbrances
Dartmouth Woods	Lakewood, CO	1990	201	1,609,800	10,832,754	—	1,379,477		1,609,800	12,212,231	13,822,031	(4,419,618	)	9,402,414	—
Dean Estates	Taunton, MA	1984	58	498,080	3,329,560	—	475,797		498,080	3,805,357	4,303,437	(918,462	)	3,384,975	—
Deerwood (SD)	San Diego, CA	1990	316	2,082,095	18,739,815	—	5,532,754		2,082,095	24,272,569	26,354,664	(12,324,380	)	14,030,284	—
Defoor Village	Atlanta, GA	1997	156	2,966,400	10,570,210	—	1,785,266		2,966,400	12,355,477	15,321,877	(3,697,813	)	11,624,064	—
Desert Homes	Phoenix, AZ	1982	412	1,481,050	13,390,249	—	3,541,588		1,481,050	16,931,837	18,412,887	(7,202,820	)	11,210,066	—
Duraleigh Woods	Raleigh, NC	1987	362	1,629,000	19,917,750	—	3,061,396		1,629,000	22,979,145	24,608,145	(7,470,099	)	17,138,047	—
Eagle Canyon	Chino Hills, CA	1985	252	1,808,900	16,426,168	—	2,671,769		1,808,900	19,097,937	20,906,837	(6,842,353	)	14,064,484	—
Emerson Place	Boston, MA (G)	1962	444	14,855,000	57,566,636	—	12,924,634		14,855,000	70,491,269	85,346,269	(24,626,242	)	60,720,027	—
Emerson Place/CRP II	Boston, MA	(F)	—	—	42,597,465	—	—		—	42,597,465	42,597,465	—		42,597,465	—
Enclave at Winston Park	Coconut Creek, FL	1995	278	5,560,000	19,939,324	—	834,324		5,560,000	20,773,648	26,333,648	(4,021,894	)	22,311,754	—
Enclave, The	Tempe, AZ	1994	204	1,500,192	19,281,399	—	928,687		1,500,192	20,210,085	21,710,277	(6,445,362	)	15,264,915	—
Estates at Wellington Green	Wellington, FL	2003	400	20,000,000	64,790,850	—	349,308		20,000,000	65,140,158	85,140,158	(2,901,329	)	82,238,829	—
Estates at Maitland Summit	Orlando, FL	1998	272	9,520,000	28,301,909	—	6,246		9,520,000	28,308,155	37,828,155	(491,690	)	37,336,465	—
Estates at Phipps	Atlanta, GA	1996	234	9,360,000	29,705,236	—	1,651,994		9,360,000	31,357,230	40,717,230	(2,260,013	)	38,457,217	—
Estates at Tanglewood	Westminster, CO	2003	504	7,560,000	51,256,538	—	680,745		7,560,000	51,937,283	59,497,283	(3,931,705	)	55,565,578	—
Fairfield	Stamford, CT (G)	1996	263	6,510,200	39,690,120	—	3,844,536		6,510,200	43,534,656	50,044,856	(12,747,627	)	37,297,229	—
Fairland Gardens	Silver Spring, MD	1981	400	6,000,000	19,972,183	—	4,285,270		6,000,000	24,257,453	30,257,453	(7,346,146	)	22,911,307	—
Fairway Greens, LLC	Pembroke Pines, FL	1987	2	12,622	140,229	—	(3,961	)	12,622	136,268	148,890	(37,812	)	111,078	—
Farnham Park	Houston, TX	1996	216	1,512,600	14,233,760	—	899,939		1,512,600	15,133,699	16,646,299	(4,940,281	)	11,706,017	—
Fifth Avenue North Combined	Seattle, WA (G)	2002	6	489,188	826,405	—	(400,162	)	489,188	426,242	915,430	—		915,430	—
Four Lakes Athletic Club	Lisle, IL (G)	N/A	—	50,000	153,489	—	227,651		50,000	381,140	431,140	(88,962	)	342,178	—
Fox Run (WA)	Federal Way, WA	1988	144	639,700	5,765,018	—	1,212,156		639,700	6,977,174	7,616,874	(3,276,285	)	4,340,590	—
Fox Run II (WA)	Federal Way, WA	1988	18	80,000	1,286,139	—	53,086		80,000	1,339,225	1,419,225	(184,368	)	1,234,857	—
Foxcroft	Scarborough, ME	1977/1979	104	523,400	4,527,409	—	832,452		523,400	5,359,861	5,883,261	(1,828,747	)	4,054,514	—
Gables Grand Plaza	Coral Gables, FL (G)	1998	195	—	44,601,000	—	1,015,213		—	45,616,213	45,616,213	(5,208,168	)	40,408,045	—
Gatehouse at Pine Lake	Pembroke Pines, FL	1990	296	1,896,600	17,070,795	—	1,812,803		1,896,600	18,883,598	20,780,198	(7,094,803	)	13,685,395	—
Gatehouse on the Green	Plantation, FL	1990	312	2,228,200	20,056,270	—	2,444,883		2,228,200	22,501,153	24,729,353	(8,394,116	)	16,335,237	—
Gates of Redmond	Redmond, WA	1979	180	2,306,100	12,064,015	—	1,292,538		2,306,100	13,356,553	15,662,653	(4,602,577	)	11,060,075	—
Gateway at Malden Center	Malden, MA (G)	1988	203	9,209,780	25,722,666	—	3,349,436		9,209,780	29,072,102	38,281,882	(4,225,495	)	34,056,387	—
Gatewood	Pleasanton, CA	1985	200	6,796,511	20,249,392	—	1,465,733		6,796,511	21,715,125	28,511,636	(3,050,358	)	25,461,278	—
Glastonbury Center	Glastonbury, CT	1962	105	852,606	5,699,497	—	550,273		852,606	6,249,770	7,102,376	(1,532,652	)	5,569,724	—
Gramercy Park	Houston, TX	1998	384	3,957,000	22,075,243	—	1,763,341		3,957,000	23,838,584	27,795,584	(4,956,657	)	22,838,927	—
Granada Highlands	Malden, MA (G)	1972	919	28,210,000	99,944,576	—	21,184,728		28,210,000	121,129,305	149,339,305	(31,588,191	)	117,751,113	—
Grandeville at River Place	Oviedo, FL	2002	280	6,000,000	23,114,693	—	1,117,815		6,000,000	24,232,508	30,232,508	(2,933,052	)	27,299,456	—
Greenfield Village	Rocky Hill , CT	1965	151	911,534	6,093,418	—	494,673		911,534	6,588,092	7,499,626	(1,561,181	)	5,938,445	—
Greentree 1	Glen Burnie, MD	1973	350	3,912,968	11,784,021	—	5,618,784		3,912,968	17,402,805	21,315,773	(4,926,427	)	16,389,346	—
Greentree 2	Glen Burnie, MD	1973	239	2,700,000	8,246,737	—	3,743,353		2,700,000	11,990,090	14,690,090	(3,119,348	)	11,570,741	—
Greentree 3	Glen Burnie, MD	1973	207	2,380,443	7,270,294	—	3,263,587		2,380,443	10,533,881	12,914,324	(2,712,856	)	10,201,468	—
Hammocks Place	Miami, FL	1986	296	319,180	12,513,467	—	2,144,153		319,180	14,657,620	14,976,800	(7,053,999	)	7,922,801	—
Hamptons	Puyallup, WA	1991	230	1,119,200	10,075,844	—	1,220,603		1,119,200	11,296,447	12,415,647	(4,116,061	)	8,299,586	—
Harborview	San Pedro, CA	1985	160	6,402,500	12,627,347	—	1,516,656		6,402,500	14,144,003	20,546,503	(5,153,082	)	15,393,421	—
Harbour Town	Boca Raton, FL	1985	392	11,760,000	20,190,252	—	4,862,069		11,760,000	25,052,321	36,812,321	(7,104,611	)	29,707,710	—
Hathaway	Long Beach, CA	1987	385	2,512,500	22,611,912	—	4,084,554		2,512,500	26,696,465	29,208,965	(10,830,627	)	18,378,338	—
Heights on Capitol Hill	Seattle, WA (G)	2006	104	5,425,000	21,102,842	—	3,400		5,425,000	21,106,242	26,531,242	(77,367	)	26,453,874	—
Heritage Ridge	Lynwood, WA	1999	197	6,895,000	18,983,597	—	32,613		6,895,000	19,016,210	25,911,210	(444,572	)	25,466,638	—
Heritage, The	Phoenix, AZ	1995	204	1,211,205	13,136,903	—	876,356		1,211,205	14,013,259	15,224,464	(4,599,536	)	10,624,929	—
Heron Pointe	Boynton Beach, FL	1989	192	1,546,700	7,774,676	—	1,285,073		1,546,700	9,059,749	10,606,449	(3,449,996	)	7,156,453	—
Hidden Lakes	Haltom City, TX	1996	312	1,872,000	20,242,109	—	1,382,580		1,872,000	21,624,689	23,496,689	(6,530,976	)	16,965,712	—
Hidden Oaks	Cary, NC	1988	216	1,178,600	10,614,135	—	2,045,175		1,178,600	12,659,310	13,837,910	(4,667,272	)	9,170,638	—
Hidden Palms	Tampa, FL	1986	256	2,049,600	6,345,885	—	1,917,063		2,049,600	8,262,948	10,312,548	(3,281,502	)	7,031,046	—
Highland Glen	Westwood, MA	1979	180	2,229,095	16,828,153	—	875,906		2,229,095	17,704,060	19,933,155	(3,799,499	)	16,133,656	—
Highlands, The	Scottsdale, AZ	1990	272	11,823,840	31,990,970	—	1,988,178		11,823,840	33,979,148	45,802,988	(1,292,483	)	44,510,505	—
Hudson Crossing	New York, NY (G)	2003	259	23,420,000	70,086,385	—	221,972		23,420,000	70,308,357	93,728,357	(6,183,117	)	87,545,240	—
Hudson Crossing II	New York, NY	(F)	—	13,177,769	3,517,127	—	—		13,177,769	3,517,127	16,694,895	—		16,694,895	—
Hudson Pointe	Jersey City, NJ	2003	182	5,148,500	41,013,460	—	299,906		5,148,500	41,313,365	46,461,865	(4,267,517	)	42,194,348	—
Hunt Club	Charlotte, NC	1990	300	990,000	17,992,887	—	1,154,961		990,000	19,147,849	20,137,849	(5,850,067	)	14,287,781	—
Hunt Club II	Charlotte, NC	(F)	—	100,000	—	—	—		100,000	—	100,000	—		100,000	—
Huntington Park	Everett, WA	1991	381	1,597,500	14,367,864	—	2,518,625		1,597,500	16,886,489	18,483,989	(7,804,784	)	10,679,205	—
Indian Bend	Scottsdale, AZ	1973	277	1,075,700	9,800,330	—	2,673,652		1,075,700	12,473,982	13,549,682	(6,042,389	)	7,507,293	—
Indian Tree	Arvada, CO	1983	168	881,225	4,552,815	—	1,766,348		881,225	6,319,163	7,200,388	(3,386,758	)	3,813,630	—
Indigo Springs	Kent, WA	1991	278	1,270,500	11,446,902	—	2,215,795		1,270,500	13,662,697	14,933,197	(5,404,642	)	9,528,555	—
Ivy Place	Atlanta, GA	1978	122	802,950	7,228,257	—	1,738,715		802,950	8,966,972	9,769,922	(3,535,461	)	6,234,461	—
Junipers at Yarmouth	Yarmouth, ME	1970	225	1,355,700	7,860,135	—	1,996,205		1,355,700	9,856,340	11,212,040	(3,794,278	)	7,417,761	—
Kempton Downs	Gresham, OR	1990	278	1,217,349	10,943,372	—	2,235,902		1,217,349	13,179,273	14,396,622	(5,916,913	)	8,479,709	—
Kenwood Mews	Burbank, CA	1991	141	14,100,000	24,622,612	—	1,848		14,100,000	24,624,460	38,724,460	(383,877	)	38,340,583	—
Keystone	Austin, TX	1981	166	498,500	4,487,295	—	1,547,837		498,500	6,035,133	6,533,633	(2,961,334	)	3,572,298	—
Kings Colony	Miami, FL	1986	480	19,200,000	48,378,023	—	257,964		19,200,000	48,635,987	67,835,987	(2,458,570	)	65,377,418	—
Kingsport	Alexandria, VA	1986	416	1,262,250	12,198,188	—	4,334,005		1,262,250	16,532,194	17,794,444	(7,426,728	)	10,367,716	—
Kirby Place	Houston, TX	1994	362	3,621,600	25,896,774	—	1,899,748		3,621,600	27,796,522	31,418,122	(9,307,656	)	22,110,466	—
La Mirage	San Diego, CA	1988/1992	1,070	28,895,200	95,567,943	—	7,199,796		28,895,200	102,767,738	131,662,938	(34,836,363	)	96,826,576	—
La Mirage IV	San Diego, CA	2001	340	6,000,000	47,449,353	—	848,077		6,000,000	48,297,430	54,297,430	(8,904,407	)	45,393,023	—
La Tour Fontaine	Houston, TX	1994	162	2,916,000	15,917,178	—	1,180,868		2,916,000	17,098,046	20,014,046	(5,182,559	)	14,831,487	—
Lakes at Vinings	Atlanta, GA	1972/1975	464	6,498,000	21,832,252	—	2,882,527		6,498,000	24,714,779	31,212,779	(8,123,649	)	23,089,129	—
Lakeshore at Preston	Plano, TX	1992	302	3,325,800	15,208,348	—	2,028,442		3,325,800	17,236,789	20,562,589	(5,350,594	)	15,211,996	—
Lakeville Resort	Petaluma, CA	1984	492	2,736,500	24,610,651	—	4,067,520		2,736,500	28,678,171	31,414,671	(11,115,508	)	20,299,163	—
Lakewood Oaks	Dallas, TX	1987	352	1,631,600	14,686,192	—	3,279,166		1,631,600	17,965,357	19,596,957	(8,029,747	)	11,567,210	—
Landings at Port Imperial	W. New York, NJ	1999	276	27,246,045	37,741,050	—	882,249		27,246,045	38,623,298	65,869,343	(8,230,557	)	57,638,786	—
Larkspur Shores	Hilliard, OH	1983	342	17,107,300	31,399,237	—	4,308,968		17,107,300	35,708,205	52,815,505	(11,956,101	)	40,859,404	—
Larkspur Woods	Sacramento, CA	1989/1993	232	5,802,900	14,576,106	—	1,542,005		5,802,900	16,118,112	21,921,012	(5,554,100	)	16,366,912	—
Laurel Ridge	Chapel Hill, NC	1975	160	160,000	3,206,076	—	3,911,569		160,000	7,117,645	7,277,645	(4,932,549	)	2,345,096	—
Laurel Ridge II	Chapel Hill, NC	(F)	—	22,551	—	—	—		22,551	—	22,551	—		22,551	—
Lexington Farm	Alpharetta, GA	1995	352	3,521,900	22,888,305	—	1,764,602		3,521,900	24,652,907	28,174,807	(7,201,543	)	20,973,264	—
Lexington Park	Orlando, FL	1988	252	2,016,000	12,346,726	—	1,999,917		2,016,000	14,346,642	16,362,642	(4,568,150	)	11,794,493	—
Lincoln Green	Pleasant Hill, CA	1973	252	15,000,000	24,335,499	—	34,297		15,000,000	24,369,795	39,369,795	(1,099,329	)	38,270,466	—
Little Cottonwoods	Tempe, AZ	1984	379	3,050,133	26,991,689	—	2,504,455		3,050,133	29,496,145	32,546,278	(9,768,618	)	22,777,659	—
Lofton Place	Tampa, FL	1988	280	2,240,000	16,679,214	—	2,077,089		2,240,000	18,756,303	20,996,303	(5,843,509	)	15,152,794	—
Longfellow Place	Boston, MA (G)	1975	710	53,164,160	183,940,619	—	30,254,795		53,164,160	214,195,414	267,359,574	(60,712,369	)	206,647,205	—
Longview Place	Waltham, MA	2004	348	20,880,000	90,255,509	—	79,293		20,880,000	90,334,802	111,214,802	(5,458,557	)	105,756,245	—
Madison at Stone Creek	Austin, TX	1995	390	2,535,000	22,611,700	—	1,848,920		2,535,000	24,460,620	26,995,620	(7,436,946	)	19,558,674	—
Madison at the Arboretum	Austin, TX	1995	161	1,046,500	9,638,269	—	1,952,393		1,046,500	11,590,662	12,637,162	(3,471,984	)	9,165,178	—
Madison at Walnut Creek	Austin, TX	1994	342	2,737,600	14,623,574	—	1,835,038		2,737,600	16,458,612	19,196,212	(5,852,372	)	13,343,840	—
Madison at Wells Branch	Austin, TX	1995	300	2,377,344	16,370,879	—	2,158,072		2,377,344	18,528,951	20,906,295	(4,671,141	)	16,235,154	—
Madison on Melrose	Richardson, TX	1995	200	1,300,000	15,096,551	—	829,103		1,300,000	15,925,654	17,225,654	(4,675,241	)	12,550,413	—
Madison on the Parkway	Dallas, TX	1995	376	2,444,000	22,505,043	—	2,081,282		2,444,000	24,586,325	27,030,325	(7,384,461	)	19,645,864	—

S - 5

ERP OPERATING LIMITED PARTNERSHIP

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2006

						Cost Capitalized
						Subsequent to			Gross Amount Carried
				Initial Cost to		Acquisition			at Close of
Description				Company		(Improvements, net) (E)			Period 12/31/06
Apartment Name	Location	Date of Construction	Units (I)	Land	Building & Fixtures	Land	Building & Fixtures		Land	Building & Fixtures (A)	Total (B)	Accumulated Depreciation (C)		Investment in Real Estate, Net at 12/31/06	Encumbrances
Magnolia at Whitlock	Marietta, GA	1971	152	132,979	1,526,005	—	3,782,685		132,979	5,308,690	5,441,668	(3,581,897	)	1,859,771	—
Mariners Wharf	Orange Park, FL	1989	272	1,861,200	16,744,951	—	2,127,022		1,861,200	18,871,973	20,733,173	(6,234,520	)	14,498,652	—
Marquessa	Corona Hills, CA	1992	336	6,888,500	21,604,584	—	2,176,400		6,888,500	23,780,983	30,669,483	(8,110,280	)	22,559,203	—
Martha Lake	Lynnwood, WA	1991	155	821,200	7,405,070	—	1,531,105		821,200	8,936,176	9,757,376	(3,324,988	)	6,432,388	—
Merrill Creek	Lakewood, WA	1994	149	814,200	7,330,606	—	664,425		814,200	7,995,031	8,809,231	(2,833,005	)	5,976,226	—
Metro on First	Seattle, WA (G)	2002	102	8,540,000	12,209,981	—	69,697		8,540,000	12,279,678	20,819,678	(870,026	)	19,949,652	—
Milano Terrace Private Residences	Scottsdale, AZ	1984	71	1,061,993	6,356,901	—	1,748,516		1,061,993	8,105,417	9,167,410	(1,897,428	)	7,269,982	—
Mill Creek	Milpitas, CA	1991	516	12,858,693	57,168,503	—	1,334,067		12,858,693	58,502,570	71,361,263	(8,255,094	)	63,106,169	—
Millbrook I	Alexandria, VA	1996	406	24,360,000	86,177,543	—	42,227		24,360,000	86,219,770	110,579,770	(3,923,864	)	106,655,905	—
Mira Flores	Palm Beach Gardens, FL	1996	352	7,040,000	22,515,299	—	852,627		7,040,000	23,367,926	30,407,926	(4,658,817	)	25,749,108	—
Mission Bay	Orlando, FL	1991	304	2,432,000	21,623,560	—	1,617,988		2,432,000	23,241,549	25,673,549	(7,036,480	)	18,637,069	—
Missions at Sunbow	Chula Vista, CA	2003	336	28,560,000	59,287,427	—	164,982		28,560,000	59,452,409	88,012,409	(3,692,391	)	84,320,018	—
Misty Woods	Cary, NC	1984	360	720,790	18,063,934	—	2,650,973		720,790	20,714,907	21,435,697	(7,094,334	)	14,341,363	—
Montecito	Valencia, CA	1999	210	8,400,000	24,709,146	—	1,010,303		8,400,000	25,719,449	34,119,449	(5,509,670	)	28,609,779	—
Monterra in Mill Creek	Mill Creek, WA	2003	139	2,800,000	13,255,123	—	112,437		2,800,000	13,367,560	16,167,560	(1,159,046	)	15,008,514	—
Montevista	Dallas, TX	2000	350	3,931,550	19,788,568	—	1,073,778		3,931,550	20,862,346	24,793,896	(4,151,265	)	20,642,631	—
Montclair Metro	Montclair, NJ	(F)	—	2,208,343	1,876,675	—	—		2,208,343	1,876,675	4,085,018	—		4,085,018	—
Morningside	Scottsdale, AZ	1989	160	670,470	12,607,976	—	1,018,022		670,470	13,625,998	14,296,468	(4,539,150	)	9,757,318	—
Mountain Park Ranch	Phoenix, AZ	1994	240	1,662,332	18,260,276	—	1,282,342		1,662,332	19,542,618	21,204,950	(6,461,637	)	14,743,312	—
Mountain Terrace	Stevenson Ranch, CA	1992	510	3,966,500	35,814,995	—	2,582,625		3,966,500	38,397,620	42,364,120	(13,712,782	)	28,651,338	—
Newport Heights	Tukwila, WA	1985	80	391,200	3,522,780	—	754,129		391,200	4,276,909	4,668,109	(2,030,416	)	2,637,693	—
North Pier at Harborside	Jersey City, NJ	2003	297	4,000,159	94,681,052	—	377,442		4,000,159	95,058,494	99,058,653	(9,178,311	)	89,880,343	—
Northampton 2	Largo, MD	1988	276	1,513,500	14,246,990	—	2,574,425		1,513,500	16,821,415	18,334,915	(7,489,500	)	10,845,415	—
Northlake (MD)	Germantown, MD	1985	304	15,000,000	23,142,302	—	6,499,373		15,000,000	29,641,675	44,641,675	(1,908,165	)	42,733,510	—
Northridge	Pleasant Hill, CA	1974	221	5,527,800	14,691,705	—	2,171,747		5,527,800	16,863,452	22,391,252	(5,749,674	)	16,641,577	—
Northwoods Village	Cary, NC	1986	228	1,369,700	11,460,337	—	2,155,446		1,369,700	13,615,783	14,985,483	(4,997,276	)	9,988,207	—
Oaks (NC)	Charlotte, NC	1996	318	2,196,744	23,601,540	—	792,240		2,196,744	24,393,780	26,590,524	(7,155,627	)	19,434,897	—
Oaks at Falls Church	Falls Church, VA	1966	176	20,240,000	20,152,616	—	1,262,957		20,240,000	21,415,573	41,655,573	(926,752	)	40,728,821	—
Ocean Crest	Solana Beach, CA	1986	146	5,111,200	11,910,438	—	1,221,892		5,111,200	13,132,330	18,243,530	(4,082,916	)	14,160,614	—
Olympus Towers	Seattle, WA (G)	2000	328	14,752,034	73,376,841	—	393,564		14,752,034	73,770,405	88,522,439	(8,316,047	)	80,206,392	—
Orchard Ridge	Lynnwood, WA	1988	104	480,600	4,372,033	—	811,590		480,600	5,183,622	5,664,222	(2,419,734	)	3,244,488	—
Overlook Manor	Frederick, MD	1980/1985	108	1,299,100	3,930,931	—	1,578,052		1,299,100	5,508,983	6,808,083	(1,937,726	)	4,870,357	—
Overlook Manor II	Frederick, MD	1980/1985	182	2,186,300	6,262,597	—	634,872		2,186,300	6,897,469	9,083,769	(2,193,575	)	6,890,194	—
Overlook Manor III	Frederick, MD	1980/1985	64	1,026,300	3,027,390	—	328,263		1,026,300	3,355,652	4,381,952	(1,039,663	)	3,342,289	—
Paces Station	Atlanta, GA	1984-1988/1989	610	4,801,500	32,548,053	—	6,244,275		4,801,500	38,792,327	43,593,827	(14,162,416	)	29,431,412	—
Pacific Cove at Playa Del Rey, LLC	Playa Del Ray, CA	1984	80	7,550,220	20,008,783	—	156,059		7,550,220	20,164,842	27,715,062	—		27,715,062	—
Palladia	Hillsboro, OR	2000	497	6,461,000	44,888,156	—	821,855		6,461,000	45,710,011	52,171,011	(9,358,197	)	42,812,813	—
Panther Ridge	Federal Way, WA	1980	260	1,055,800	9,506,117	—	1,308,645		1,055,800	10,814,762	11,870,562	(4,163,363	)	7,707,199	—
Paradise Pointe	Dania, FL	1987-90	320	1,913,414	17,417,956	—	4,119,571		1,913,414	21,537,527	23,450,941	(9,471,257	)	13,979,684	—
Parc Royale	Houston, TX	1994	171	2,223,000	11,936,833	—	1,558,738		2,223,000	13,495,570	15,718,570	(4,240,368	)	11,478,202	—
Parc Vue at Lake Buena Vista	Orlando, FL	2000/2002	336	11,760,000	34,526,029	—	855,283		11,760,000	35,381,312	47,141,312	(2,214,447	)	44,926,865	—
Park at Turtle Run	Coral Springs, FL	2001	257	15,420,000	36,064,629	—	115,286		15,420,000	36,179,915	51,599,915	(2,113,355	)	49,486,559	—
Park Bloomingdale Condominium Homes	Bloomingdale, IL	1989	172	2,282,317	11,550,120	—	2,195,517		2,282,317	13,745,637	16,027,954	(4,107,908	)	11,920,046	—
Park Meadow	Gilbert, AZ	1986	224	835,217	15,120,769	—	1,670,556		835,217	16,791,324	17,626,541	(5,550,735	)	12,075,806	—
Park Place (TX)	Houston, TX	1996	229	1,603,000	12,054,926	—	914,966		1,603,000	12,969,891	14,572,891	(4,275,260	)	10,297,631	—
Park West (CA)	Los Angeles, CA	1987/90	444	3,033,500	27,302,383	—	3,444,937		3,033,500	30,747,320	33,780,820	(12,802,928	)	20,977,892	—
Parkside	Union City, CA	1979	208	6,246,700	11,827,453	—	2,803,628		6,246,700	14,631,081	20,877,781	(5,202,705	)	15,675,076	—
Parkview Terrace	Redlands, CA	1986	558	4,969,200	35,653,777	—	8,070,060		4,969,200	43,723,837	48,693,037	(13,325,566	)	35,367,472	—
Parkwood (CT)	East Haven, CT	1975	102	531,365	3,552,064	—	464,999		531,365	4,017,063	4,548,427	(966,800	)	3,581,627	—
Phillips Park	Wellesley, MA	1988	49	816,922	5,460,955	—	551,882		816,922	6,012,837	6,829,759	(1,335,175	)	5,494,584	—
Pine Harbour	Orlando, FL	1991	366	1,664,300	14,970,915	—	2,631,472		1,664,300	17,602,387	19,266,687	(8,332,502	)	10,934,185	—
Playa Pacifica	Hermosa Beach, CA	1972	285	35,100,000	33,473,822	—	410,291		35,100,000	33,884,113	68,984,113	(1,887,355	)	67,096,758	—
Plum Tree	Hales Corners, WI	1989	332	1,996,700	20,247,195	—	1,435,400		1,996,700	21,682,595	23,679,295	(7,131,242	)	16,548,053	—
Pointe at South Mountain	Phoenix, AZ	1988	364	2,228,800	20,059,311	—	2,536,265		2,228,800	22,595,576	24,824,376	(8,111,203	)	16,713,174	—
Polos East	Orlando, FL	1991	308	1,386,000	19,058,620	—	1,438,211		1,386,000	20,496,831	21,882,831	(6,265,330	)	15,617,500	—
Port Royale	Ft. Lauderdale, FL (G)	1988	252	1,754,200	15,789,873	—	4,293,894		1,754,200	20,083,767	21,837,967	(8,314,371	)	13,523,596	—
Port Royale II	Ft. Lauderdale, FL (G)	1988	161	1,022,200	9,203,166	—	2,712,635		1,022,200	11,915,801	12,938,001	(4,532,826	)	8,405,175	—
Port Royale III	Ft. Lauderdale, FL (G)	1988	324	7,454,900	14,725,802	—	4,931,699		7,454,900	19,657,501	27,112,401	(6,749,472	)	20,362,929	—
Port Royale IV	Ft. Lauderdale, FL	(F)	—	—	26,997	—	—		—	26,997	26,997	—		26,997	—
Portofino	Chino Hills, CA	1989	176	3,572,400	14,660,994	—	1,314,151		3,572,400	15,975,145	19,547,545	(5,206,302	)	14,341,242	—
Preakness	Antioch, TN	1986	260	1,561,900	7,668,521	—	2,224,100		1,561,900	9,892,621	11,454,521	(3,998,297	)	7,456,225	—
Preserve at Deer Creek	Deerfield Beach, FL	1997	540	13,500,000	60,011,208	—	691,204		13,500,000	60,702,413	74,202,413	(7,071,995	)	67,130,418	—
Prime, The	Arlington, VA	2002	256	32,000,000	64,449,841	—	(5	)	32,000,000	64,449,836	96,449,836	(1,003,651	)	95,446,185	—
Promenade (FL)	St. Petersburg, FL	1994	334	2,124,193	25,804,037	—	3,107,691		2,124,193	28,911,728	31,035,921	(8,760,171	)	22,275,750	—
Promenade at Aventura	Aventura, FL	1995	296	13,320,000	30,353,748	—	1,529,461		13,320,000	31,883,209	45,203,209	(6,985,380	)	38,217,829	—
Promenade at Peachtree	Chamblee, GA	2001	406	10,150,000	31,219,739	—	1,040,108		10,150,000	32,259,847	42,409,847	(3,372,922	)	39,036,925	—
Promenade at Town Center I	Valencia, CA	2001	294	14,700,000	35,390,279	—	841,778		14,700,000	36,232,057	50,932,057	(4,382,847	)	46,549,209	—
Promenade at Wyndham Lakes	Coral Springs, FL	1998	332	6,640,000	26,743,760	—	1,038,403		6,640,000	27,782,163	34,422,163	(6,559,185	)	27,862,978	—
Promenade Terrace	Corona, CA	1990	330	2,272,800	20,546,289	—	3,110,625		2,272,800	23,656,915	25,929,715	(9,058,086	)	16,871,628	—
Promontory Pointe I & II	Phoenix, AZ	1984/1996	424	2,355,509	30,421,840	—	2,899,735		2,355,509	33,321,575	35,677,084	(10,974,605	)	24,702,479	—
Prospect Towers	Hackensack, NJ	1995	157	3,926,600	27,966,416	—	2,831,346		3,926,600	30,797,763	34,724,363	(9,993,091	)	24,731,271	—
Prospect Towers II	Hackensack, NJ	2002	203	4,500,000	33,104,733	—	889,424		4,500,000	33,994,157	38,494,157	(5,663,287	)	32,830,870	—
Providence	Bothell, WA	2000	200	3,573,621	19,055,505	—	266,848		3,573,621	19,322,354	22,895,975	(2,345,897	)	20,550,078	—
Ranch at Fossil Creek	Haltom City, TX	2003	274	1,715,435	16,829,282	—	436,756		1,715,435	17,266,038	18,981,473	(2,300,557	)	16,680,916	—
Ravinia	Greenfield, WI	1991	206	1,240,100	12,055,713	—	832,049		1,240,100	12,887,762	14,127,862	(4,265,270	)	9,862,593	—
Redlands Lawn and Tennis	Redlands, CA	1986	496	4,822,320	26,359,328	—	3,241,300		4,822,320	29,600,629	34,422,949	(9,888,427	)	24,534,522	—
Redmond Ridge (Land)	Redmond, WA	(F)	—	6,975,705	6,671,830	—	—		6,975,705	6,671,830	13,647,535	—		13,647,535	—
Regency	Charlotte, NC	1986	178	890,000	11,783,920	—	1,315,147		890,000	13,099,067	13,989,067	(3,982,637	)	10,006,429	—
Regency Palms	Huntington Beach, CA	1969	310	1,857,400	16,713,254	—	3,079,768		1,857,400	19,793,021	21,650,421	(8,064,331	)	13,586,090	—
Regency Park	Centreville, VA	1989	252	2,521,500	16,200,666	—	4,662,656		2,521,500	20,863,322	23,384,822	(6,371,370	)	17,013,452	—
Remington Place	Phoenix, AZ	1983	412	1,492,750	13,377,478	—	3,470,919		1,492,750	16,848,397	18,341,147	(7,278,079	)	11,063,068	—
Reserve at Clarendon Centre, The	Arlington, VA (G)	2003	252	10,500,000	52,812,935	—	776,698		10,500,000	53,589,633	64,089,633	(6,382,075	)	57,707,558	—
Reserve at Eisenhower, The	Alexandria, VA	2002	226	6,500,000	34,585,060	—	174,392		6,500,000	34,759,452	41,259,452	(5,085,596	)	36,173,855	—
Reserve at Empire Lakes	Rancho Cucamonga, CA	2005	467	16,345,000	73,081,671	—	112,194		16,345,000	73,193,864	89,538,864	(4,504,542	)	85,034,322	—
Reserve at Moreno Valley Ranch	Moreno Valley, CA	2005	176	8,800,000	26,151,088	—	31,882		8,800,000	26,182,970	34,982,970	(1,196,124	)	33,786,846	—
Residences at Little River	Haverhill, MA	2003	174	6,905,138	19,172,797	—	190,531		6,905,138	19,363,328	26,268,466	(2,409,000	)	23,859,467	—

Richmond Townhomes	Houston, TX	1995	188	940,000	13,906,905	—	2,171,398	940,000	16,078,303	17,018,303	(4,589,497	)	12,428,806	—
Ridgewood Village	San Diego, CA	1997	192	5,761,500	14,032,511	—	775,745	5,761,500	14,808,256	20,569,756	(4,598,153	)	15,971,602	—
Ridgewood Village II	San Diego, CA	1997	216	6,048,000	19,971,537	—	136,416	6,048,000	20,107,953	26,155,953	(4,312,547	)	21,843,406	—
Rincon	Houston, TX	1996	288	4,401,900	16,734,746	—	1,664,598	4,401,900	18,399,344	22,801,244	(6,572,590	)	16,228,654	—
River Hill	Grand Prairie, TX	1996	334	2,004,000	19,272,944	—	1,428,146	2,004,000	20,701,090	22,705,090	(6,277,321	)	16,427,769	—
River Park	Fort Worth, TX	1984	280	2,245,400	8,811,727	—	2,891,050	2,245,400	11,702,777	13,948,177	(4,414,847	)	9,533,329	—
River Stone Ranch	Austin, TX	1998	448	5,376,000	27,004,185	—	1,391,746	5,376,000	28,395,931	33,771,931	(3,966,450	)	29,805,481	—
Riviera at West Village	Dallas, TX	1995	150	6,534,000	14,749,422	—	822,128	6,534,000	15,571,550	22,105,550	(1,111,667	)	20,993,883	—

S - 6

ERP OPERATING LIMITED PARTNERSHIP

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2006

						Cost Capitalized
						Subsequent to			Gross Amount Carried
				Initial Cost to		Acquisition			at Close of
Description				Company		(Improvements, net) (E)			Period 12/31/06
Apartment Name	Location	Date of Construction	Units (I)	Land	Building & Fixtures	Land	Building & Fixtures		Land	Building & Fixtures (A)	Total (B)	Accumulated Depreciation (C)		Investment in Real Estate, Net at 12/31/06	Encumbrances
Rivers Edge	Waterbury, CT	1974	156	781,900	6,561,167	—	908,573		781,900	7,469,740	8,251,640	(2,379,281	)	5,872,359	—
Rock Creek	Carrboro, NC	1986	188	895,700	8,062,543	—	1,888,798		895,700	9,951,341	10,847,041	(3,850,036	)	6,997,004	—
Rosecliff	Quincy, MA	1990	156	5,460,000	15,721,570	—	385,476		5,460,000	16,107,046	21,567,046	(4,164,987	)	17,402,058	—
Royal Oaks (FL)	Jacksonville, FL	1991	284	1,988,000	13,645,117	—	2,018,719		1,988,000	15,663,836	17,651,836	(4,763,881	)	12,887,955	—
Sabal Palm at Boot Ranch	Palm Harbor, FL	1996	432	3,888,000	28,923,692	—	2,086,359		3,888,000	31,010,050	34,898,050	(9,325,573	)	25,572,477	—
Sabal Palm at Carrollwood Place	Tampa, FL	1995	432	3,888,000	26,911,542	—	1,475,872		3,888,000	28,387,415	32,275,415	(8,426,151	)	23,849,264	—
Sabal Palm at Lake Buena Vista	Orlando, FL	1988	400	2,800,000	23,687,893	—	2,182,202		2,800,000	25,870,095	28,670,095	(7,872,138	)	20,797,956	—
Sabal Palm at Metrowest	Orlando, FL	1998	411	4,110,000	38,394,865	—	2,197,274		4,110,000	40,592,138	44,702,138	(12,045,661	)	32,656,477	—
Sabal Palm at Metrowest II	Orlando, FL	1997	456	4,560,000	33,907,283	—	1,628,540		4,560,000	35,535,823	40,095,823	(10,349,274	)	29,746,549	—
Sabal Pointe	Coral Springs, FL	1995	275	1,951,600	17,570,508	—	2,421,872		1,951,600	19,992,380	21,943,980	(7,902,438	)	14,041,542	—
Saddle Ridge	Ashburn, VA	1989	216	1,364,800	12,283,616	—	1,578,493		1,364,800	13,862,110	15,226,910	(5,622,464	)	9,604,445	—
Sailboat Bay	Raleigh, NC	1986	192	960,000	8,797,580	—	1,146,582		960,000	9,944,161	10,904,161	(3,111,950	)	7,792,211	—
San Marcos	Scottsdale, AZ	1995	320	20,000,000	31,236,223	—	11,258		20,000,000	31,247,481	51,247,481	(519,582	)	50,727,899	—
Savannah at Park Place	Atlanta, GA	2001	416	7,696,095	34,114,542	—	1,919,334		7,696,095	36,033,876	43,729,971	(4,071,207	)	39,658,764	—
Savannah Lakes	Boynton Beach, FL	1991	466	7,000,000	30,422,607	—	1,443,363		7,000,000	31,865,970	38,865,970	(6,147,882	)	32,718,087	—
Scottsdale Meadows	Scottsdale, AZ	1984	168	1,512,000	11,407,699	—	1,138,943		1,512,000	12,546,642	14,058,642	(4,204,408	)	9,854,234	—
Seeley Lake	Lakewood, WA	1990	522	2,760,400	24,845,286	—	2,716,246		2,760,400	27,561,533	30,321,933	(9,781,751	)	20,540,182	—
Seventh & James	Seattle, WA	1992	96	663,800	5,974,803	—	1,980,783		663,800	7,955,586	8,619,386	(3,242,280	)	5,377,107	—
Shadow Creek	Winter Springs, FL	2000	280	6,000,000	21,719,768	—	686,031		6,000,000	22,405,800	28,405,800	(2,528,671	)	25,877,129	—
Shadow Lake	Doraville, GA	1989	228	1,140,000	13,117,277	—	904,999		1,140,000	14,022,276	15,162,276	(4,256,796	)	10,905,480	—
Sheffield Court	Arlington, VA	1986	597	3,349,350	31,337,332	—	3,706,251		3,349,350	35,043,584	38,392,934	(15,153,000	)	23,239,934	—
Silver Spring	Silver Spring, MD	(F)	—	18,539,817	22,144,191	—	—		18,539,817	22,144,191	40,684,008	—		40,684,008	—
Silver Springs (FL)	Jacksonville, FL	1985	432	1,831,100	16,474,735	—	4,521,158		1,831,100	20,995,893	22,826,993	(8,295,022	)	14,531,971	—
Skylark	Union City, CA	1986	174	1,781,600	16,731,916	—	1,143,820		1,781,600	17,875,736	19,657,336	(5,425,454	)	14,231,882	—
Sommerset Place	Raleigh, NC	1983	144	360,000	7,800,206	—	1,045,295		360,000	8,845,500	9,205,500	(2,803,374	)	6,402,126	—
Sonata at Cherry Creek	Denver, CO	1999	183	5,490,000	18,130,479	—	693,378		5,490,000	18,823,857	24,313,857	(4,107,443	)	20,206,414	—
Sonoran	Phoenix, AZ	1995	429	2,361,922	31,841,724	—	1,787,444		2,361,922	33,629,167	35,991,089	(10,913,107	)	25,077,982	—
South Palm Place Condominium Homes	Tamarac, FL	1991	99	771,120	7,019,483	—	1,364,382		771,120	8,383,864	9,154,984	(2,119,831	)	7,035,152	—
Southwood	Palo Alto, CA	1985	99	6,936,600	14,324,069	—	1,485,834		6,936,600	15,809,903	22,746,503	(5,048,516	)	17,697,988	—
Spring Hill Commons	Acton, MA	1973	105	1,107,436	7,402,980	—	961,530		1,107,436	8,364,510	9,471,945	(1,887,933	)	7,584,013	—
Springbrook Estates	Riverside, CA	(F)	—	70,532,700	158,297	—	—		70,532,700	158,297	70,690,997	—		70,690,997	—
St. Andrews at Winston Park	Coconut Creek, FL	1997	284	5,680,000	19,812,090	—	862,771		5,680,000	20,674,861	26,354,861	(4,047,253	)	22,307,608	—
Steeplechase	Charlotte, NC	1986	247	1,111,500	10,180,750	—	1,367,405		1,111,500	11,548,155	12,659,655	(3,630,538	)	9,029,117	—
Stone Oak	Houston, TX	1998	318	2,502,876	17,513,496	—	947,832		2,502,876	18,461,328	20,964,204	(3,364,858	)	17,599,346	—
Stonegate (CO)	Broomfield, CO	2003	350	8,750,000	32,998,775	—	1,615,116		8,750,000	34,613,891	43,363,891	(2,333,918	)	41,029,973	—
Stoneleigh at Deerfield	Alpharetta, GA	2003	370	4,810,000	29,999,596	—	331,831		4,810,000	30,331,427	35,141,427	(2,836,991	)	32,304,435	—
Stoney Creek	Lakewood, WA	1990	231	1,215,200	10,938,134	—	1,594,714		1,215,200	12,532,847	13,748,047	(4,449,457	)	9,298,590	—
Sturbridge Meadows	Sturbridge, MA	1985	104	702,447	4,695,714	—	643,591		702,447	5,339,305	6,041,752	(1,222,760	)	4,818,992	—
Summer Creek	Plymouth, MN	1985	72	579,600	3,815,800	—	563,958		579,600	4,379,758	4,959,358	(1,528,244	)	3,431,114	—
Summer Ridge	Riverside, CA	1985	136	602,400	5,422,807	—	1,785,972		602,400	7,208,779	7,811,179	(2,745,010	)	5,066,169	—
Summerset Village II	Chatsworth, CA	(F)	—	260,646	31,577	—	—		260,646	31,577	292,223	—		292,223	—
Summerwood	Hayward, CA	1982	162	4,866,600	6,942,743	—	1,042,052		4,866,600	7,984,796	12,851,396	(2,695,431	)	10,155,965	—
Summit at Lake Union	Seattle, WA	1995 - 1997	150	1,424,700	12,852,461	—	1,428,589		1,424,700	14,281,050	15,705,750	(5,124,417	)	10,581,333	—
Sunforest	Davie, FL	1989	494	10,000,000	32,124,850	—	1,747,157		10,000,000	33,872,006	43,872,006	(4,706,870	)	39,165,137	—
Surrey Downs	Bellevue, WA	1986	122	3,057,100	7,848,618	—	793,762		3,057,100	8,642,380	11,699,480	(2,799,920	)	8,899,560	—
Sycamore Creek	Scottsdale, AZ	1984	350	3,152,000	19,083,727	—	2,197,744		3,152,000	21,281,471	24,433,471	(7,389,141	)	17,044,330	—
Tamarlane	Portland, ME	1986	115	690,900	5,153,633	—	603,641		690,900	5,757,274	6,448,174	(2,078,515	)	4,369,659	—
Timber Hollow	Chapel Hill, NC	1986	198	800,000	11,219,537	—	1,475,045		800,000	12,694,581	13,494,581	(3,902,869	)	9,591,712	—
Timber Ridge, LLC	Woodinville, WA	1986	4	28,629	265,181	—	(64,057	)	28,629	201,125	229,754	(115,062	)	114,691	—
Timberwalk	Jacksonville, FL	1987	284	1,988,000	13,204,219	—	1,415,041		1,988,000	14,619,259	16,607,259	(4,641,908	)	11,965,351	—
Tortuga Bay	Orlando, FL	2004	314	6,280,000	32,121,779	—	416,449		6,280,000	32,538,228	38,818,228	(2,723,427	)	36,094,801	—
Toscana	Irvine, CA	1991/1993	563	39,410,000	50,806,072	—	3,776,758		39,410,000	54,582,831	93,992,831	(12,480,800	)	81,512,030	—
Town Center (TX)	Kingwood, TX	1994	258	1,291,300	11,530,216	—	1,992,505		1,291,300	13,522,721	14,814,021	(4,873,105	)	9,940,917	—
Town Center II (TX)	Kingwood, TX	1994	260	1,375,000	14,169,656	—	92,683		1,375,000	14,262,339	15,637,339	(3,604,908	)	12,032,431	—
Townes at Herndon	Herndon, VA	2002	218	10,900,000	49,216,125	—	22,214		10,900,000	49,238,339	60,138,339	(1,574,437	)	58,563,902	—
Tradition at Alafaya	Oviedo, FL	2006	253	7,590,000	32,014,299	—	(117	)	7,590,000	32,014,182	39,604,182	(1,010,541	)	38,593,642	—
Trails at Dominion Park	Houston, TX	1992	843	2,531,800	35,699,589	—	5,248,612		2,531,800	40,948,201	43,480,001	(15,291,501	)	28,188,500	—
Trump Place, 140 Riverside	New York, NY (G)	2003	354	103,539,100	94,082,057	—	122,980		103,539,100	94,205,037	197,744,137	(5,953,348	)	191,790,789	—
Trump Place, 160 Riverside	New York, NY (G)	2001	455	139,933,500	190,963,887	—	469,688		139,933,500	191,433,575	331,367,075	(10,922,967	)	320,444,108	—
Trump Place, 180 Riverside	New York, NY (G)	1998	516	144,968,250	138,345,708	—	1,546,310		144,968,250	139,892,018	284,860,268	(8,557,076	)	276,303,193	—
Turnberry Isle	Dallas, TX	1994	187	2,992,000	15,287,285	—	584,990		2,992,000	15,872,275	18,864,275	(1,582,010	)	17,282,266	—
Tuscany at Lindbergh	Atlanta, GA	2001	324	9,720,000	40,874,023	—	641,135		9,720,000	41,515,158	51,235,158	(2,500,579	)	48,734,580	—
Tyrone Gardens	Randolph, MA	1961/1965	165	4,953,000	5,799,572	—	1,414,338		4,953,000	7,213,910	12,166,910	(2,456,900	)	9,710,010	—
Uptown Square	Denver, CO (G)	1999/2001	696	17,492,000	100,697,530	—	321,993		17,492,000	101,019,523	118,511,523	(3,250,099	)	115,261,423	—
Valencia Plantation	Orlando, FL	1990	194	873,000	12,819,377	—	935,834		873,000	13,755,211	14,628,211	(4,008,336	)	10,619,875	—
Versailles	Woodland Hills, CA	1991	253	12,650,000	33,656,292	—	2,335,009		12,650,000	35,991,301	48,641,301	(4,672,266	)	43,969,035	—
Via Ventura	Scottsdale, AZ	1980	328	1,486,600	13,382,006	—	6,976,055		1,486,600	20,358,061	21,844,661	(11,540,954	)	10,303,707	—
View Pointe	Riverside, CA	1998	208	10,400,000	26,315,150	—	630,958		10,400,000	26,946,108	37,346,108	(1,569,338	)	35,776,770	—
Villa Solana	Laguna Hills, CA	1984	272	1,665,100	14,985,678	—	3,690,234		1,665,100	18,675,911	20,341,011	(8,999,716	)	11,341,295	—
Village at Lakewood	Phoenix, AZ	1988	240	3,166,411	13,859,090	—	1,476,850		3,166,411	15,335,940	18,502,351	(5,322,569	)	13,179,782	—
Village Oaks	Austin, TX	1984	280	1,186,000	10,663,736	—	2,882,522		1,186,000	13,546,258	14,732,258	(4,953,970	)	9,778,287	—
Village of Newport	Kent, WA	1987	100	416,300	3,756,582	—	621,623		416,300	4,378,205	4,794,505	(2,054,658	)	2,739,847	—
Virgil Square	Los Angeles, CA	1979	142	5,500,000	15,216,210	—	381,952		5,500,000	15,598,162	21,098,162	(1,165,569	)	19,932,594	—
Vista Del Lago	Mission Viejo, CA	1986-88	608	4,525,800	40,736,293	—	7,454,025		4,525,800	48,190,319	52,716,119	(21,970,822	)	30,745,296	—
Vista Grove	Mesa, AZ	1997 - 1998	224	1,341,796	12,157,045	—	925,655		1,341,796	13,082,700	14,424,496	(4,168,626	)	10,255,871	—
Vista Montana - Residential	San Jose, CA	(F)	—	—	1,225,533	—	—		—	1,225,533	1,225,533	—		1,225,533	—
Vista Montana - Condo	San Jose, CA	(F)	—	—	439,553	—	—		—	439,553	439,553	—		439,553	—
Waterford (Jax) II	Jacksonville, FL	(F)	—	566,923	62,373	—	—		566,923	62,373	629,296	—		629,296	—
Waterford at Deerwood	Jacksonville, FL	1985	248	1,696,000	10,659,702	—	2,068,695		1,696,000	12,728,397	14,424,397	(4,193,484	)	10,230,913	—
Waterford Place (CO)	Thornton, CO	1998	336	5,040,000	29,733,022	—	662,702		5,040,000	30,395,724	35,435,724	(2,289,513	)	33,146,212	—
Waterside	Reston, VA	1984	276	20,700,000	27,474,388	—	796,855		20,700,000	28,271,242	48,971,242	(1,938,567	)	47,032,675	—
Webster Green	Needham, MA	1985	77	1,418,893	9,485,006	—	457,298		1,418,893	9,942,304	11,361,197	(2,226,316	)	9,134,881	—
Welleby Lake Club	Sunrise, FL	1991	304	3,648,000	17,620,879	—	1,583,390		3,648,000	19,204,270	22,852,270	(5,886,183	)	16,966,086	—
Westfield Village	Centerville, VA	1988	228	7,000,000	23,245,834	—	3,765,784		7,000,000	27,011,618	34,011,618	(2,873,291	)	31,138,327	—
Westridge	Tacoma, WA	1987/1991	714	3,501,900	31,506,082	—	3,983,305		3,501,900	35,489,387	38,991,287	(12,958,546	)	26,032,741	—
Westside Villas I	Los Angeles, CA	1999	21	1,785,000	3,233,254	—	193,400		1,785,000	3,426,654	5,211,654	(822,173	)	4,389,482	—
Westside Villas II	Los Angeles, CA	1999	23	1,955,000	3,541,435	—	50,148		1,955,000	3,591,583	5,546,583	(781,098	)	4,765,486	—
Westside Villas III	Los Angeles, CA	1999	36	3,060,000	5,538,871	—	98,852		3,060,000	5,637,723	8,697,723	(1,233,642	)	7,464,081	—
Westside Villas IV	Los Angeles, CA	1999	36	3,060,000	5,539,390	—	84,742		3,060,000	5,624,133	8,684,133	(1,220,045	)	7,464,088	—
Westside Villas V	Los Angeles, CA	1999	60	5,100,000	9,224,485	—	143,070		5,100,000	9,367,556	14,467,556	(2,038,121	)	12,429,434	—
Westside Villas VI	Los Angeles, CA	1989	18	1,530,000	3,023,523	—	146,993		1,530,000	3,170,515	4,700,515	(694,718	)	4,005,797	—
Westside Villas VII	Los Angeles, CA	2001	53	4,505,000	10,758,900	—	141,444		4,505,000	10,900,343	15,405,343	(1,786,865	)	13,618,479	—
Whispering Oaks	Walnut Creek, CA	1974	316	2,170,800	19,539,586	—	3,246,477		2,170,800	22,786,063	24,956,863	(8,857,885	)	16,098,977	—
Willow Trail	Norcross, GA	1985	224	1,120,000	11,412,982	—	1,027,009		1,120,000	12,439,990	13,559,990	(3,850,958	)	9,709,033	—

S - 7

ERP OPERATING LIMITED PARTNERSHIP

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2006

						Cost Capitalized
						Subsequent to		Gross Amount Carried
				Initial Cost to		Acquisition		at Close of
Description				Company		(Improvements, net) (E)		Period 12/31/06
Apartment Name	Location	Date of Construction	Units (I)	Land	Building & Fixtures	Land	Building & Fixtures	Land	Building & Fixtures (A)	Total (B)	Accumulated Depreciation (C)		Investment in Real Estate, Net at 12/31/06	Encumbrances
Wimberly	Dallas, TX	1996	372	2,232,000	27,685,923	—	1,445,913	2,232,000	29,131,836	31,363,836	(8,636,474	)	22,727,362	—
Wimberly at Deerwood	Jacksonville, FL	2000	322	8,000,000	30,057,214	—	807,195	8,000,000	30,864,410	38,864,410	(1,878,829	)	36,985,581	—
Wimbledon Oaks	Arlington, TX	1985	248	1,491,700	8,843,716	—	2,200,545	1,491,700	11,044,261	12,535,961	(3,615,907	)	8,920,054	—
Winchester Park	Riverside, RI	1972	416	2,822,618	18,868,626	—	3,031,769	2,822,618	21,900,395	24,723,013	(5,883,598	)	18,839,415	—
Winchester Wood	Riverside, RI	1989	62	683,215	4,567,154	—	436,297	683,215	5,003,451	5,686,666	(1,098,276	)	4,588,391	—
Windemere	Mesa, AZ	1986	224	940,450	8,659,280	—	1,948,232	940,450	10,607,512	11,547,962	(4,190,260	)	7,357,702	—
Windmont	Atlanta, GA	1988	178	3,204,000	7,128,448	—	783,453	3,204,000	7,911,901	11,115,901	(2,139,825	)	8,976,076	—
Windsor at Fair Lakes	Fairfax, VA	1988	250	10,000,000	28,587,109	—	3,820,070	10,000,000	32,407,178	42,407,178	(3,280,409	)	39,126,769	—
Winterwood	Charlotte, NC	1986	384	1,722,000	15,501,142	—	3,767,520	1,722,000	19,268,662	20,990,662	(9,406,175	)	11,584,487	—
Wood Creek (CA)	Pleasant Hill, CA	1987	256	9,729,900	23,009,768	—	1,711,007	9,729,900	24,720,775	34,450,675	(8,542,210	)	25,908,465	—
Woodbridge II	Cary, GA	1993-95	216	1,244,600	11,243,364	—	1,546,563	1,244,600	12,789,927	14,034,527	(4,862,665	)	9,171,862	—
Woodland Hills	Decatur, GA	1985	228	1,224,600	11,010,681	—	2,314,167	1,224,600	13,324,848	14,549,448	(5,522,032	)	9,027,416	—
Woodlands of Brookfield	Brookfield, WI	1990	148	1,484,600	13,961,081	—	1,157,041	1,484,600	15,118,122	16,602,722	(4,884,796	)	11,717,926	—
Woodmoor	Austin, TX	1981	208	653,800	5,875,968	—	2,398,443	653,800	8,274,412	8,928,212	(4,290,687	)	4,637,525	—
Woodside	Lorton, VA	1987	252	1,326,000	12,510,903	—	4,816,061	1,326,000	17,326,963	18,652,963	(6,745,922	)	11,907,041	—
Yarmouth Woods	Yarmouth, ME	1971/1978	138	692,800	6,096,155	—	1,290,437	692,800	7,386,592	8,079,392	(2,497,078	)	5,582,314	—
Management Business	Chicago, IL	(D)	—	—	—	—	69,475,276	—	69,475,276	69,475,276	(31,833,061	)	37,642,215	—
Operating Partnership	Chicago, IL	(F)	—	—	491,595	—	—	—	491,595	491,595	—		491,595	—
EQR Wholly Owned Unencumbered			97,902	2,480,114,318	8,218,412,694	—	755,163,632	2,480,114,318	8,973,576,325	11,453,690,644	(2,006,699,313	)	9,446,991,331	—
EQR Wholly Owned Encumbered:
1660 Peachtree	Atlanta, GA	1999	355	7,987,511	23,602,563	—	2,052,728	7,987,511	25,655,291	33,642,802	(2,969,665	)	30,673,137	23,000,000
2400 M St	Washington, D.C. (G)	2006	359	30,006,593	114,138,624	—	85,766	30,006,593	114,224,390	144,230,983	(3,205,390	)	141,025,593	75,936,000
2nd & 85th St	New York, NY	(F)	—	15,601,092	9,944,601	—	—	15,601,092	9,944,601	25,545,693	—		25,545,693	15,566,275
740 River Drive	St. Paul, MN	1962	163	1,626,700	11,234,943	—	3,347,310	1,626,700	14,582,252	16,208,952	(5,642,838	)	10,566,114	5,077,662
929 House	Cambridge, MA (G)	1975	127	3,252,993	21,745,595	—	1,673,535	3,252,993	23,419,130	26,672,123	(5,226,889	)	21,445,234	4,035,104
Academy Village	North Hollywood, CA	1989	248	25,000,000	23,593,194	—	1,184,661	25,000,000	24,777,855	49,777,855	(1,952,440	)	47,825,415	20,000,000
Agliano	Tampa, FL	(F)	—	8,424,662	4,797,568	—	—	8,424,662	4,797,568	13,222,229	—		13,222,229	6,099,616
Alta Pacific	Irvine, CA	(F)	—	10,752,145	11,037,426	—	—	10,752,145	11,037,426	21,789,570	—		21,789,570	28,260,000
Amberton	Manassas, VA	1986	190	900,600	11,921,815	—	1,959,704	900,600	13,881,519	14,782,119	(4,963,171	)	9,818,948	10,705,000
Arbor Terrace	Sunnyvale, CA	1979	174	9,057,300	18,483,642	—	1,590,781	9,057,300	20,074,423	29,131,723	(6,001,316	)	23,130,407	(O)
Arboretum (MA)	Canton, MA	1989	156	4,685,900	10,992,751	—	1,178,505	4,685,900	12,171,256	16,857,156	(3,896,064	)	12,961,092	(L)
Arboretum at Stonelake	Austin, TX	1996	408	6,120,000	24,069,023	—	1,657,170	6,120,000	25,726,193	31,846,193	(3,600,313	)	28,245,880	14,970,000
Arbors of Hickory Hollow	Antioch, TN	1986	336	202,985	6,936,761	—	3,529,757	202,985	10,466,517	10,669,502	(5,870,130	)	4,799,372	(K)
Arden Villas	Orlando, FL	1999	336	5,500,000	28,600,796	—	2,089,931	5,500,000	30,690,727	36,190,727	(2,094,908	)	34,095,819	23,247,561
Artisan Square	Northridge, CA	2002	140	7,000,000	20,537,359	—	292,700	7,000,000	20,830,060	27,830,060	(3,133,707	)	24,696,353	(Q)
Autumn River	Raleigh, NC	2002	284	3,408,000	20,890,457	—	513,753	3,408,000	21,404,210	24,812,210	(2,650,683	)	22,161,527	(Q)
Avon Place	Avon, CT	1973	163	1,788,943	12,440,003	—	811,291	1,788,943	13,251,294	15,040,237	(2,988,280	)	12,051,958	(M)
Bay Hill	Long Beach, CA	2002	160	7,600,000	27,437,239	—	153,455	7,600,000	27,590,694	35,190,694	(2,912,115	)	32,278,579	13,996,000
Bradford Apartments	Newington, CT	1964	64	401,091	2,681,210	—	334,347	401,091	3,015,557	3,416,648	(734,598	)	2,682,049	(M)
Bradley Park	Puyallup, WA	1999	155	3,813,000	18,313,645	—	81,765	3,813,000	18,395,410	22,208,410	(1,103,632	)	21,104,778	12,443,749
Briar Knoll Apts	Vernon, CT	1986	150	928,972	6,209,988	—	815,944	928,972	7,025,932	7,954,904	(1,704,439	)	6,250,465	5,587,997
Briarwood (CA)	Sunnyvale, CA	1985	192	9,991,500	22,247,278	—	934,943	9,991,500	23,182,221	33,173,721	(6,824,575	)	26,349,146	12,800,000
Brookdale Village	Naperville, IL	1986	252	3,276,000	16,293,023	—	1,890,027	3,276,000	18,183,050	21,459,050	(5,259,890	)	16,199,160	10,820,000
Brookside (MD)	Frederick, MD	1993	228	2,736,000	7,934,069	—	1,505,337	2,736,000	9,439,406	12,175,406	(2,949,476	)	9,225,930	8,170,000
Brooksyde Apts	West Hartford, CT	1945	80	594,711	3,975,523	—	462,828	594,711	4,438,351	5,033,062	(1,078,479	)	3,954,583	(M)
Burgundy Studios	Middletown, CT	1973	102	395,238	2,642,087	—	305,181	395,238	2,947,268	3,342,506	(766,460	)	2,576,046	(M)
Canterbury	Germantown, MD	1986	544	2,781,300	32,942,531	—	9,622,847	2,781,300	42,565,377	45,346,677	(14,717,022	)	30,629,655	31,680,000
Carlyle	Dallas, TX	1993	180	1,890,000	14,155,000	—	757,963	1,890,000	14,912,963	16,802,963	(2,121,562	)	14,681,401	7,985,386
Cedar Glen	Reading, MA	1980	114	1,248,505	8,346,003	—	870,999	1,248,505	9,217,002	10,465,507	(2,093,019	)	8,372,489	1,330,414
Centennial Court	Seattle, WA (G)	2001	187	3,800,000	21,280,039	—	147,078	3,800,000	21,427,117	25,227,117	(1,768,802	)	23,458,314	17,671,302
Centennial Tower	Seattle, WA (G)	1991	221	5,900,000	48,800,339	—	727,028	5,900,000	49,527,368	55,427,368	(3,858,363	)	51,569,004	27,893,694
Cherry Creek I,II,&III (TN)	Hermitage, TN	1986/96	627	2,942,345	45,725,245	—	2,595,966	2,942,345	48,321,211	51,263,556	(13,377,168	)	37,886,388	16,892,453
Chestnut Glen	Abington, MA	1983	130	1,178,965	7,881,139	—	616,872	1,178,965	8,498,011	9,676,976	(1,988,090	)	7,688,887	3,607,045
Chickasaw Crossing	Orlando, FL	1986	292	2,044,000	12,366,832	—	1,201,286	2,044,000	13,568,119	15,612,119	(4,232,373	)	11,379,746	11,648,914
Church Corner	Cambridge, MA (G)	1987	85	5,220,000	16,744,643	—	106,905	5,220,000	16,851,548	22,071,548	(1,554,793	)	20,516,755	12,000,000
Cierra Crest	Denver, CO	1996	480	4,803,100	34,894,898	—	2,171,147	4,803,100	37,066,044	41,869,144	(12,039,922	)	29,829,222	(O)
City Lofts	Chicago, IL	(F)	—	5,946,369	7,902,033	—	—	5,946,369	7,902,033	13,848,402	—		13,848,402	(J)
Club at Tanasbourne	Hillsboro, OR	1990	352	3,521,300	16,257,934	—	2,560,552	3,521,300	18,818,487	22,339,787	(6,914,209	)	15,425,578	(N)
Coachlight Village	Agawam, MA	1967	88	501,726	3,353,933	—	286,900	501,726	3,640,833	4,142,558	(878,731	)	3,263,827	(M)
Colonial Village	Plainville, CT	1968	104	693,575	4,636,410	—	697,434	693,575	5,333,844	6,027,419	(1,303,637	)	4,723,782	(M)
Conway Court	Roslindale, MA	1920	28	101,451	710,524	—	148,476	101,451	858,999	960,450	(211,156	)	749,295	372,378
Country Club Lakes	Jacksonville, FL	1997	555	15,000,000	41,055,786	—	1,458,520	15,000,000	42,514,306	57,514,306	(3,201,835	)	54,312,471	34,106,923
Coventry at Cityview	Fort Worth, TX	1996	360	2,160,000	23,072,847	—	1,805,282	2,160,000	24,878,129	27,038,129	(7,412,420	)	19,625,709	(Q)
Creekside (San Mateo)	San Mateo, CA	1985	192	9,606,600	21,193,232	—	1,090,183	9,606,600	22,283,415	31,890,015	(6,693,710	)	25,196,305	(O)
Creekside Homes at Legacy	Plano. TX	1998	380	4,560,000	32,275,748	—	1,925,740	4,560,000	34,201,488	38,761,488	(9,950,809	)	28,810,679	16,800,000
Cross Creek	Matthews, NC	1989	420	3,151,600	20,295,925	—	1,926,578	3,151,600	22,222,503	25,374,103	(7,077,104	)	18,296,999	(O)
Crown Court	Scottsdale, AZ	1987	416	3,156,600	28,414,599	—	4,338,515	3,156,600	32,753,114	35,909,714	(11,534,011	)	24,375,703	(P)
Dean Estates II	Cranston, RI	1970	48	308,457	2,061,971	—	404,267	308,457	2,466,238	2,774,695	(613,800	)	2,160,895	(M)
Deerwood (Corona)	Corona, CA	1992	316	4,742,200	20,272,892	—	2,538,163	4,742,200	22,811,055	27,553,255	(7,870,791	)	19,682,464	(Q)
Eastbridge	Dallas, TX	1998	169	3,380,000	11,860,382	—	661,554	3,380,000	12,521,935	15,901,935	(2,733,407	)	13,168,528	8,026,896
Fernbrook Townhomes	Plymouth, MN	1993	72	580,100	6,683,693	—	459,059	580,100	7,142,752	7,722,852	(2,206,216	)	5,516,636	4,855,548
Fireside Park	Rockville, MD	1961	236	4,248,000	9,977,101	—	2,323,800	4,248,000	12,300,901	16,548,901	(3,788,931	)	12,759,970	8,095,000
Forest Ridge I & II	Arlington, TX	1984/85	660	2,362,700	21,263,295	—	5,245,440	2,362,700	26,508,735	28,871,435	(10,897,465	)	17,973,969	(P)
Four Lakes 5	Lisle, IL (G)	1968/1988	478	600,000	19,186,686	—	3,171,557	600,000	22,358,243	22,958,243	(13,891,138	)	9,067,105	(L)
Four Winds	Fall River, MA	1987	168	1,370,843	9,163,804	—	1,067,946	1,370,843	10,231,751	11,602,593	(2,345,502	)	9,257,092	(M)
Fox Hill Apartments	Enfield, CT	1974	168	1,129,018	7,547,256	—	731,052	1,129,018	8,278,308	9,407,326	(1,959,318	)	7,448,008	(M)
Gallery, The	Hermosa Beach,CA	1971	168	18,144,000	46,565,645	—	3,190	18,144,000	46,568,835	64,712,835	(543,302	)	64,169,533	34,460,000
Geary Court Yard	San Francisco, CA	1990	164	1,722,400	15,471,429	—	1,155,470	1,722,400	16,626,899	18,349,299	(5,446,542	)	12,902,757	17,693,865
Glen Grove	Wellesley, MA	1979	125	1,344,601	8,988,383	—	661,016	1,344,601	9,649,399	10,994,000	(2,225,895	)	8,768,105	2,157,190
Glen Meadow	Franklin, MA	1971	288	2,339,330	17,796,431	—	2,018,461	2,339,330	19,814,892	22,154,222	(4,542,534	)	17,611,689	1,546,912
Glenlake	Glendale Heights. IL	1988	336	5,041,700	16,671,970	—	4,635,767	5,041,700	21,307,737	26,349,437	(7,990,753	)	18,358,684	14,845,000
Gosnold Grove	East Falmouth, MA	1978	33	124,296	830,891	—	171,810	124,296	1,002,701	1,126,996	(282,786	)	844,210	529,015
Greenhaven	Union City, CA	1983	250	7,507,000	15,210,399	—	1,664,822	7,507,000	16,875,221	24,382,221	(5,413,716	)	18,968,505	10,975,000
Greenhouse - Frey Road	Kennesaw, GA	1985	489	2,467,200	22,187,443	—	3,643,631	2,467,200	25,831,074	28,298,274	(11,927,896	)	16,370,378	(L)
Greenhouse - Holcomb Bridge	Alpharetta, GA	1985	437	2,143,300	19,291,427	—	3,431,367	2,143,300	22,722,795	24,866,095	(10,729,479	)	14,136,616	(L)
Greenhouse - Roswell	Roswell, GA	1985	236	1,220,000	10,974,727	—	2,091,987	1,220,000	13,066,714	14,286,714	(6,262,485	)	8,024,229	(L)
Hampshire Place	Los Angeles, CA	1989	259	10,806,000	30,335,330	—	954,609	10,806,000	31,289,939	42,095,939	(2,947,784	)	39,148,155	18,681,951
Harbor Steps	Seattle, WA (G)	2000	730	59,900,000	158,829,662	—	812,941	59,900,000	159,642,603	219,542,603	(9,618,544	)	209,924,059	142,998,760
Heritage at Stone Ridge	Burlington, MA	2005	180	10,800,000	31,808,335	—	13,390	10,800,000	31,821,725	42,621,725	(1,032,478	)	41,589,248	29,186,892
Heritage Green	Sturbridge, MA	1974	130	835,313	5,583,898	—	822,502	835,313	6,406,400	7,241,713	(1,583,527	)	5,658,186	1,722,829
High Meadow	Ellington, CT	1975	100	583,679	3,901,774	—	296,872	583,679	4,198,647	4,782,326	(1,016,090	)	3,766,236	3,994,044
Highland Glen II	Westwood, MA	(F)	—	—	7,069,447	—	—	—	7,069,447	7,069,447	—		7,069,447	1,384,362
Highland Point	Aurora, CO	1984	319	1,631,900	14,684,439	—	1,900,859	1,631,900	16,585,298	18,217,198	(6,060,369	)	12,156,829	(N)

S - 8

ERP OPERATING LIMITED PARTNERSHIP

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2006

						Cost Capitalized
						Subsequent to		Gross Amount Carried
				Initial Cost to		Acquisition		at Close of
Description				Company		(Improvements, net) (E)		Period 12/31/06
Apartment Name	Location	Date of Construction	Units (I)	Land	Building & Fixtures	Land	Building & Fixtures	Land	Building & Fixtures (A)	Total (B)	Accumulated Depreciation (C)		Investment in Real Estate, Net at 12/31/06	Encumbrances
Highlands at Cherry Hill	Cherry Hills, NJ	2002	170	6,800,000	21,459,108	—	63,469	6,800,000	21,522,577	28,322,577	(1,537,068	)	26,785,509	16,983,599
Highlands at South Plainfield	South Plainfield, NJ	2000	252	10,080,000	37,526,912	—	143,289	10,080,000	37,670,201	47,750,201	(2,182,182	)	45,568,019	21,978,565
Highline Oaks	Denver, CO	1986	220	1,057,400	9,340,249	—	1,633,630	1,057,400	10,973,879	12,031,279	(4,268,727	)	7,762,552	(L)
Isle at Arrowhead Ranch	Glendale, AZ	1996	256	1,650,237	19,593,123	—	1,076,108	1,650,237	20,669,232	22,319,469	(6,635,237	)	15,684,231	(N)
Ivory Wood	Bothell, WA	2000	144	2,732,800	13,888,282	—	260,308	2,732,800	14,148,590	16,881,390	(1,536,323	)	15,345,067	8,020,000
Jaclen Towers	Beverly, NJ	1976	100	437,072	2,921,735	—	757,876	437,072	3,679,611	4,116,683	(1,021,556	)	3,095,127	1,662,193
James Street Crossing	Kent, WA	1989	300	2,081,254	18,748,337	—	1,591,291	2,081,254	20,339,629	22,420,882	(6,793,182	)	15,627,700	16,379,123
Laguna Clara	Santa Clara, CA	1972	264	13,642,420	29,707,475	—	1,589,501	13,642,420	31,296,976	44,939,395	(3,593,540	)	41,345,855	16,395,237
LaSalle	Beaverton, OR (G)	1998	554	7,202,000	35,877,612	—	1,421,673	7,202,000	37,299,285	44,501,285	(6,286,439	)	38,214,845	32,281,178
Legacy at Highlands Ranch	Highlands Ranch, CO	1999	422	6,330,000	37,557,013	—	715,465	6,330,000	38,272,478	44,602,478	(3,683,899	)	40,918,579	23,364,115
Legends at Preston	Morrisville, NC	2000	382	3,056,000	27,150,092	—	825,344	3,056,000	27,975,437	31,031,437	(6,437,195	)	24,594,241	(Q)
Lenox at Patterson Place	Durham, NC	1999	292	4,380,000	18,969,172	—	252,146	4,380,000	19,221,319	23,601,319	(1,733,779	)	21,867,540	13,311,200
Liberty Park	Brain Tree, MA	2000	202	5,977,504	26,748,835	—	1,144,941	5,977,504	27,893,775	33,871,279	(3,915,415	)	29,955,864	26,500,000
Lincoln Heights	Quincy, MA	1991	336	5,928,400	33,595,262	—	3,407,908	5,928,400	37,003,170	42,931,570	(11,388,352	)	31,543,219	(O)
Longfellow Glen	Sudbury, MA	1984	120	1,094,273	7,314,994	—	1,962,404	1,094,273	9,277,398	10,371,671	(2,350,664	)	8,021,007	3,646,298
Longwood	Decatur, GA	1992	268	1,454,048	13,087,393	—	1,294,958	1,454,048	14,382,351	15,836,399	(6,580,613	)	9,255,787	(P)
Loomis Manor	West Hartford, CT	1948	43	422,350	2,823,326	—	340,486	422,350	3,163,812	3,586,162	(777,046	)	2,809,116	(M)
Madison at Cedar Springs	Dallas, TX	1995	380	2,470,000	33,194,620	—	1,812,787	2,470,000	35,007,407	37,477,407	(10,033,392	)	27,444,015	(O)
Madison at Chase Oaks	Plano, TX	1995	470	3,055,000	28,932,885	—	1,660,074	3,055,000	30,592,959	33,647,959	(9,194,874	)	24,453,085	(O)
Madison at River Sound	Lawrenceville, GA	1996	586	3,666,999	47,387,106	—	1,639,481	3,666,999	49,026,588	52,693,587	(14,219,468	)	38,474,120	(Q)
Madison at Round Grove	Lewisville, TX	1995	404	2,626,000	25,682,373	—	2,025,283	2,626,000	27,707,656	30,333,656	(8,253,692	)	22,079,964	(N)
Madison at Scofield Farms	Austin, TX	1996	260	2,080,000	14,597,971	—	1,761,739	2,080,000	16,359,710	18,439,710	(4,050,986	)	14,388,723	11,809,427
Marks	Englewood, CO (G)	1987	616	4,928,500	44,622,314	—	3,818,828	4,928,500	48,441,143	53,369,643	(17,079,936	)	36,289,707	19,195,000
Meadow Ridge	Norwich, CT	1987	120	747,957	4,999,937	—	435,724	747,957	5,435,661	6,183,617	(1,283,296	)	4,900,321	4,186,418
Merritt at Satellite Place	Duluth, GA	1999	424	3,400,000	30,115,674	—	846,006	3,400,000	30,961,680	34,361,680	(8,002,830	)	26,358,850	(P)
Mill Pond	Millersville, MD	1984	240	2,880,000	8,468,014	—	1,606,331	2,880,000	10,074,345	12,954,345	(3,366,047	)	9,588,298	7,300,000
Montierra	Scottsdale, AZ	1999	249	3,455,000	17,266,787	—	902,348	3,455,000	18,169,134	21,624,134	(5,019,201	)	16,604,934	(N)
Montierra (CA)	San Diego, CA	1990	272	8,160,000	29,360,938	—	5,248,802	8,160,000	34,609,740	42,769,740	(7,632,314	)	35,137,427	17,065,682
Nehoiden Glen	Needham, MA	1978	61	634,538	4,241,755	—	396,597	634,538	4,638,352	5,272,890	(1,085,007	)	4,187,883	853,972
Noonan Glen	Winchester, MA	1983	18	151,344	1,011,700	—	253,182	151,344	1,264,882	1,416,226	(315,708	)	1,100,518	367,925
North Hill	Atlanta, GA	1984	420	2,525,300	18,550,989	—	5,869,398	2,525,300	24,420,387	26,945,687	(10,470,941	)	16,474,747	15,005,000
Northampton 1	Largo, MD	1977	344	1,843,200	17,528,381	—	4,450,047	1,843,200	21,978,428	23,821,628	(10,415,820	)	13,405,808	18,518,465
Northglen	Valencia, CA	1988	234	9,360,000	20,778,553	—	970,063	9,360,000	21,748,615	31,108,615	(4,827,171	)	26,281,445	14,002,893
Norton Glen	Norton, MA	1983	150	1,012,556	6,768,727	—	2,319,858	1,012,556	9,088,585	10,101,141	(2,410,159	)	7,690,982	3,455,734
Oak Mill I	Germantown, MD	1984	208	10,000,000	13,155,522	—	2,964,729	10,000,000	16,120,251	26,120,251	(1,030,729	)	25,089,521	14,020,434
Oak Mill II	Germantown, MD	1985	192	854,133	10,233,947	—	4,076,264	854,133	14,310,211	15,164,344	(4,691,037	)	10,473,306	9,600,000
Oak Park North	Agoura Hills, CA	1990	220	1,706,900	15,362,666	—	1,364,400	1,706,900	16,727,066	18,433,966	(6,610,491	)	11,823,475	(H)
Oak Park South	Agoura Hills, CA	1989	224	1,683,800	15,154,608	—	1,458,829	1,683,800	16,613,437	18,297,237	(6,612,935	)	11,684,302	(H)
Oaks	Santa Clarita, CA	2000	520	23,400,000	61,020,438	—	1,526,455	23,400,000	62,546,893	85,946,893	(8,311,764	)	77,635,129	44,145,593
Ocean Walk	Key West, FL	1990	297	2,838,749	25,545,009	—	1,962,607	2,838,749	27,507,616	30,346,365	(9,010,029	)	21,336,335	21,079,921
Old Mill Glen	Maynard, MA	1983	50	396,756	2,652,233	—	349,674	396,756	3,001,907	3,398,663	(727,222	)	2,671,441	1,470,615
Olde Redmond Place	Redmond, WA	1986	192	4,807,100	14,126,038	—	3,560,002	4,807,100	17,686,040	22,493,140	(5,219,902	)	17,273,238	(O)
Parkfield	Denver, CO	2000	476	8,330,000	28,667,618	—	1,269,982	8,330,000	29,937,600	38,267,600	(6,557,488	)	31,710,112	23,275,000
Point (NC)	Charlotte, NC	1996	340	1,700,000	25,417,267	—	808,668	1,700,000	26,225,935	27,925,935	(7,691,364	)	20,234,571	(P)
Portofino (Val)	Valencia, CA	1989	216	8,640,000	21,487,126	—	1,185,661	8,640,000	22,672,788	31,312,788	(4,905,494	)	26,407,294	13,612,927
Portside Towers	Jersey City, NJ (G)	1992/1997	527	22,455,700	96,842,913	—	5,787,065	22,455,700	102,629,978	125,085,678	(30,931,907	)	94,153,771	51,660,809
Prairie Creek I	Richardson, TX	1998/99	464	4,067,292	38,986,022	—	1,770,999	4,067,292	40,757,021	44,824,312	(11,297,225	)	33,527,088	(N)
Preston Bend	Dallas, TX	1986	255	1,075,200	9,532,056	—	1,452,729	1,075,200	10,984,786	12,059,986	(4,065,152	)	7,994,833	(L)
Promenade at Town Center II	Valencia, CA	2001	270	13,500,000	34,405,636	—	1,099,138	13,500,000	35,504,774	49,004,774	(4,091,670	)	44,913,104	35,381,430
Providence at Kirby	Houston, TX	1999	263	3,945,000	20,587,782	—	2,082,938	3,945,000	22,670,720	26,615,720	(3,981,248	)	22,634,472	17,497,407
Ranchstone	Houston, TX	1996	220	770,000	15,371,431	—	698,002	770,000	16,069,433	16,839,433	(4,760,662	)	12,078,771	(P)
Ravens Crest	Plainsboro, NJ	1984	704	4,670,850	42,080,642	—	9,158,080	4,670,850	51,238,722	55,909,572	(22,212,136	)	33,697,436	(O)
Reserve at Ashley Lake	Boynton Beach, FL	1990	440	3,520,400	23,332,494	—	2,829,478	3,520,400	26,161,972	29,682,372	(8,704,513	)	20,977,859	24,150,000
Reserve at Fairfax Corners	Fairfax, VA	2001	652	15,804,057	63,129,051	—	822,238	15,804,057	63,951,288	79,755,345	(10,417,153	)	69,338,192	(Q)
Reserve at Potomac Yard	Alexandria, VA	2002	588	11,918,917	68,976,484	—	976,677	11,918,917	69,953,161	81,872,077	(7,383,279	)	74,488,799	66,470,000
Reserve at Town Center	Loudon, VA	2002	290	3,144,056	27,669,121	—	447,296	3,144,056	28,116,417	31,260,473	(3,156,973	)	28,103,500	26,500,000
Reserve at Town Center (WA)	Mill Creek, WA	2001	389	10,369,400	41,172,081	—	551,112	10,369,400	41,723,193	52,092,593	(4,326,324	)	47,766,269	29,160,000
Retreat, The	Phoenix, AZ	1999	480	3,475,114	27,265,252	—	1,384,123	3,475,114	28,649,375	32,124,489	(7,798,799	)	24,325,691	(P)
Ribbon Mill	Manchester, CT	1908	104	787,929	5,267,144	—	450,152	787,929	5,717,296	6,505,225	(1,372,176	)	5,133,049	4,177,257
River Pointe at Den Rock Park	Lawrence, MA	2000	174	4,615,702	18,440,147	—	731,030	4,615,702	19,171,177	23,786,879	(3,019,924	)	20,766,956	18,100,000
Rivers Bend (CT)	Windsor, CT	1973	373	3,325,517	22,573,826	—	1,470,299	3,325,517	24,044,125	27,369,642	(5,577,831	)	21,791,811	(M)
Riverview Condominiums	Norwalk, CT	1991	92	2,300,000	7,406,730	—	1,451,122	2,300,000	8,857,852	11,157,852	(2,576,581	)	8,581,271	5,762,246
Rockingham Glen	West Roxbury, MA	1974	143	1,124,217	7,515,160	—	1,030,086	1,124,217	8,545,246	9,669,463	(2,046,224	)	7,623,239	1,982,265
Rolling Green (Amherst)	Amherst, MA	1970	204	1,340,702	8,962,317	—	2,483,372	1,340,702	11,445,689	12,786,391	(2,933,371	)	9,853,020	3,176,795
Rolling Green (Milford)	Milford, MA	1970	304	2,012,350	13,452,150	—	2,233,452	2,012,350	15,685,602	17,697,952	(4,166,739	)	13,531,213	6,411,164
Royale	Cranston, RI	1976	76	512,785	3,427,866	—	511,169	512,785	3,939,035	4,451,820	(970,344	)	3,481,476	(M)
Savannah Midtown	Atlanta, GA	2000	322	7,209,873	29,433,507	—	701,727	7,209,873	30,135,234	37,345,107	(3,435,943	)	33,909,164	17,800,000
Savoy I	Aurora, CO	2001	444	6,109,460	38,765,670	—	863,806	6,109,460	39,629,476	45,738,936	(4,610,717	)	41,128,219	(O)
Scarborough Square	Rockville, MD	1967	121	1,815,000	7,608,126	—	1,609,081	1,815,000	9,217,207	11,032,207	(2,977,714	)	8,054,493	4,652,200
Security Manor	Westfield, MA	1971	63	355,456	2,376,152	—	156,428	355,456	2,532,580	2,888,036	(590,736	)	2,297,301	(M)
Sedona Springs	Austin, TX	1995	396	2,574,000	23,477,043	—	2,690,214	2,574,000	26,167,257	28,741,257	(7,987,754	)	20,753,502	(P)
Siena Terrace	Lake Forest, CA	1988	356	8,900,000	24,083,024	—	1,856,227	8,900,000	25,939,250	34,839,250	(7,445,906	)	27,393,345	16,743,402
Skycrest	Valencia, CA	1999	264	10,560,000	25,574,457	—	1,143,673	10,560,000	26,718,131	37,278,131	(5,823,540	)	31,454,591	16,946,177
Skyline Towers	Falls Church, VA (G)	1971	939	78,278,200	91,484,764	—	1,268,870	78,278,200	92,753,635	171,031,835	(7,102,912	)	163,928,923	92,594,283
Skyview	Rancho Santa Margarita, CA	1999	260	3,380,000	21,952,863	—	866,189	3,380,000	22,819,052	26,199,052	(6,091,615	)	20,107,437	(P)
Sonterra at Foothill Ranch	Foothill Ranch, CA	1997	300	7,503,400	24,048,507	—	1,073,835	7,503,400	25,122,342	32,625,742	(7,798,632	)	24,827,110	(O)
South Winds	Fall River, MA	1971	404	2,481,821	16,780,359	—	2,450,689	2,481,821	19,231,048	21,712,869	(4,988,894	)	16,723,975	6,329,013
Springs Colony	Altamonte Springs, FL	1986	188	630,411	5,852,157	—	1,859,211	630,411	7,711,368	8,341,779	(3,732,774	)	4,609,005	(L)
Stoney Ridge	Dale City, VA	1985	264	8,000,000	24,147,091	—	3,203,633	8,000,000	27,350,724	35,350,724	(1,580,144	)	33,770,580	16,487,748
Stonybrook	Boynton Beach, FL	2001	264	10,500,000	24,967,638	—	300,654	10,500,000	25,268,292	35,768,292	(2,025,736	)	33,742,556	22,698,602
Summer Chase	Denver, CO	1983	384	1,709,200	15,375,008	—	2,928,364	1,709,200	18,303,372	20,012,572	(7,717,479	)	12,295,094	(N)
Summerhill Glen	Maynard, MA	1980	120	415,812	3,000,816	—	518,109	415,812	3,518,925	3,934,737	(958,487	)	2,976,250	1,615,411
Summerset Village	Chatsworth, CA	1985	280	2,630,700	23,670,889	—	2,156,850	2,630,700	25,827,740	28,458,440	(9,276,969	)	19,181,471	(N)
Summit & Birch Hill	Farmington, CT	1967	186	1,757,438	11,748,112	—	1,295,341	1,757,438	13,043,453	14,800,891	(3,051,136	)	11,749,755	(M)
Talleyrand	Tarrytown, NY (L)	1997-98	300	12,000,000	49,838,160	—	3,009,985	12,000,000	52,848,145	64,848,145	(9,749,010	)	55,099,135	35,000,000
Tanasbourne Terrace	Hillsboro, OR	1986-89	373	1,876,700	16,891,205	—	3,176,067	1,876,700	20,067,272	21,943,972	(9,226,767	)	12,717,204	(N)
Tanglewood (RI)	West Warwick, RI	1973	176	1,141,415	7,630,129	—	542,318	1,141,415	8,172,446	9,313,862	(1,928,816	)	7,385,046	6,119,315
Tanglewood (VA)	Manassas, VA	1987	432	2,108,295	24,619,495	—	6,755,046	2,108,295	31,374,541	33,482,836	(11,409,349	)	22,073,486	25,110,000
Turf Club	Littleton, CO	1986	324	2,107,300	15,478,040	—	2,437,516	2,107,300	17,915,556	20,022,856	(6,336,194	)	13,686,662	(P)
Union Station	Los Angeles, CA	(F)	—	8,500,000	56,351,848	—	20,708	8,500,000	56,372,555	64,872,555	—		64,872,555	39,786,999
Uwajimaya Village	Seattle, WA	2002	176	8,800,000	22,188,275	—	13,008	8,800,000	22,201,283	31,001,283	(1,362,172	)	29,639,111	17,110,471
Van Deene Manor	West Springfield, MA	1970	111	744,491	4,976,771	—	413,979	744,491	5,390,750	6,135,241	(1,289,474	)	4,845,767	(M)
Villa Encanto	Phoenix, AZ	1983	383	2,884,447	22,197,363	—	2,637,833	2,884,447	24,835,196	27,719,643	(8,701,565	)	19,018,078	(P)
Village at Bear Creek	Lakewood, CO	1987	472	4,519,700	40,676,390	—	2,605,666	4,519,700	43,282,056	47,801,756	(14,573,650	)	33,228,106	(O)

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ERP OPERATING LIMITED PARTNERSHIP

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2006

								Cost Capitalized
								Subsequent to				Gross Amount Carried
				Initial Cost to				Acquisition				at Close of
Description				Company				(Improvements, net) (E)				Period 12/31/06
Apartment Name	Location	Date of Construction	Units (I)	Land		Building & Fixtures		Land		Building & Fixtures		Land		Building & Fixtures (A)		Total (B)		Accumulated Depreciation (C)			Investment in Real Estate, Net at 12/31/06		Encumbrances
Villas at Josey Ranch	Carrollton, TX	1986	198	1,587,700		7,254,727		—		1,730,751		1,587,700		8,985,479		10,573,179		(3,057,535		)	7,515,643		6,092,776
Vintage	Ontario, CA	(F)	—	7,059,230		38,083,277		—		—		7,059,230		38,083,277		45,142,508		—			45,142,508		40,775,042
Vista Del Lago (TX)	Dallas, TX	1992	296	3,552,000		20,066,912		—		1,202,082		3,552,000		21,268,994		24,820,994		(4,704,851		)	20,116,143		(N)
Warwick Station	Westminster, CO	1986	332	2,282,000		21,113,974		—		1,633,183		2,282,000		22,747,157		25,029,157		(7,684,285		)	17,344,872		8,355,000
Waterford at Orange Park	Orange Park, FL	1986	280	1,960,000		12,098,784		—		2,313,997		1,960,000		14,412,782		16,372,782		(4,971,051		)	11,401,731		9,540,000
Waterford at the Lakes	Kent, WA	1990	344	3,100,200		16,140,924		—		1,843,767		3,100,200		17,984,691		21,084,891		(6,698,259		)	14,386,632		(Q)
Wellington Hill	Manchester, NH	1987	390	1,890,200		17,120,662		—		4,805,649		1,890,200		21,926,311		23,816,511		(10,361,742		)	13,454,769		(L)
Westgate	Pasadena, CA	(F)	—	46,802,616		10,480,376		—		—		46,802,616		10,480,376		57,282,992		—			57,282,992		28,666,040
Westwood Glen	Westwood, MA	1972	156	1,616,505		10,806,004		—		390,684		1,616,505		11,196,688		12,813,193		(2,541,517		)	10,271,676		981,284
Whisper Creek	Denver, CO	2002	272	5,310,000		22,998,558		—		365,119		5,310,000		23,363,677		28,673,677		(2,259,697		)	26,413,980		13,580,000
Wilkins Glen	Medfield, MA	1975	103	538,483		3,629,943		—		661,999		538,483		4,291,942		4,830,425		(1,119,190		)	3,711,235		1,436,791
Windridge (CA)	Laguna Niguel, CA	1989	344	2,662,900		23,985,497		—		3,097,251		2,662,900		27,082,747		29,745,647		(11,907,606		)	17,838,042		(H)
Woodbridge	Cary, GA	1993-95	128	737,400		6,636,870		—		1,121,244		737,400		7,758,114		8,495,514		(3,070,630		)	5,424,884		4,175,389
Woodbridge (CT)	Newington, CT	1968	73	498,377		3,331,548		—		476,311		498,377		3,807,859		4,306,236		(872,673		)	3,433,563		(M)
Woodlake (WA)	Kirkland, WA	1984	288	6,631,400		16,735,484		—		1,886,511		6,631,400		18,621,995		25,253,395		(5,965,512		)	19,287,883		(O)
Woodleaf	Campbell, CA	1984	178	8,550,600		16,988,183		—		865,954		8,550,600		17,854,137		26,404,737		(5,440,933		)	20,963,803		(O)
Woodridge (MN)	Eagan, MN	1986	200	1,602,300		10,449,579		—		1,558,895		1,602,300		12,008,474		13,610,774		(4,033,502		)	9,577,272		7,060,251
EQR Wholly Owned Encumbered			48,540	998,881,216		3,931,377,111		—		291,342,825		998,881,216		4,222,719,936		5,221,601,153		(936,392,757		)	4,285,208,396		1,923,428,819
EQR Partially Owned Unencumbered:
1210 Mass	Washington, D.C.	2004	144	9,213,512		30,728,957		—		110,955		9,213,512		30,839,912		40,053,425		(2,545,296		)	37,508,129		—
Ball Park Lofts	Denver, CO	2003	339	5,481,556		53,226,470		—		395,599		5,481,556		53,622,070		59,103,626		(5,115,208		)	53,988,418		—
EQR Partially Owned Unencumbered			483	14,695,068		83,955,427		—		506,554		14,695,068		84,461,982		99,157,051		(7,660,504		)	91,496,547		—
EQR Partially Owned Encumbered:
Bella Terra I	Mukilteo, WA	2002	235	5,686,861		26,070,540		—		312,115		5,686,861		26,382,655		32,069,517		(3,115,530		)	28,953,986		23,350,000
Brookside Crossing I	Stockton, CA	1981	90	625,000		4,663,298		—		1,365,294		625,000		6,028,592		6,653,592		(1,566,398		)	5,087,194		4,658,000
Brookside Crossing II	Stockton, CA	1981	128	770,000		5,967,676		—		1,374,519		770,000		7,342,194		8,112,194		(1,728,481		)	6,383,713		4,867,000
Canyon Creek (CA)	San Ramon, CA	1984	268	5,425,000		18,812,121		—		1,593,132		5,425,000		20,405,252		25,830,252		(4,384,869		)	21,445,384		28,000,000
Cobblestone Village	Fresno, CA	1983	162	315,000		7,587,004		—		1,551,020		315,000		9,138,024		9,453,024		(1,894,336		)	7,558,688		6,000,000
Country Oaks	Agoura Hills, CA	1985	256	6,105,000		29,561,865		—		1,897,266		6,105,000		31,459,131		37,564,131		(5,447,312		)	32,116,819		29,412,000
Deerfield	Denver, CO	1983	158	1,260,000		8,502,224		—		1,345,675		1,260,000		9,847,899		11,107,899		(2,357,475		)	8,750,424		9,100,000
Edgewater	Bakersfield, CA	1984	258	580,000		17,710,063		—		1,845,232		580,000		19,555,294		20,135,294		(3,684,647		)	16,450,647		11,988,000
Fox Ridge	Englewood, CO	1984	300	2,490,000		17,522,114		—		1,649,489		2,490,000		19,171,603		21,661,603		(4,673,060		)	16,988,543		20,300,000
Hidden Lake	Sacramento, CA	1985	272	1,715,000		16,413,154		—		1,750,680		1,715,000		18,163,833		19,878,833		(3,784,138		)	16,094,696		15,165,000
Lakeview	Lodi, CA	1983	138	950,000		7,383,862		—		1,207,936		950,000		8,591,798		9,541,798		(1,890,044		)	7,651,754		7,286,000
Lakewood	Tulsa, OK	1985	152	855,000		6,480,774		—		900,713		855,000		7,381,487		8,236,487		(1,958,047		)	6,278,440		5,600,000
Lantern Cove	Foster City, CA	1985	232	6,945,000		23,332,206		—		1,388,082		6,945,000		24,720,288		31,665,288		(5,084,132		)	26,581,155		36,403,000
Legacy Park Central	Concord, CA	2003	259	6,469,230		46,745,854		—		51,275		6,469,230		46,797,129		53,266,359		(4,349,725		)	48,916,634		37,650,000
Mesa Del Oso	Albuquerque, NM	1983	221	4,305,000		12,160,419		—		956,672		4,305,000		13,117,091		17,422,091		(3,112,304		)	14,309,787		10,271,614
Schooner Bay I	Foster City, CA	1985	168	5,345,000		20,509,239		—		1,544,185		5,345,000		22,053,424		27,398,424		(4,176,012		)	23,222,412		27,000,000
Schooner Bay II	Foster City, CA	1985	144	4,550,000		18,142,163		—		1,466,173		4,550,000		19,608,337		24,158,337		(3,668,252		)	20,490,085		23,760,000
South Shore	Stockton, CA	1979	129	840,000		9,380,786		—		1,287,382		840,000		10,668,168		11,508,168		(2,137,899		)	9,370,269		6,833,000
Tierra Antigua	Albuquerque, NM	1985	148	1,825,000		7,841,358		—		486,388		1,825,000		8,327,746		10,152,746		(2,016,718		)	8,136,028		6,069,590
Waterfield Square I	Stockton, CA	1984	170	950,000		9,300,249		—		1,789,096		950,000		11,089,345		12,039,345		(2,434,588		)	9,604,757		6,923,000
Waterfield Square II	Stockton, CA	1984	158	845,000		8,657,988		—		1,385,043		845,000		10,043,031		10,888,031		(2,075,145		)	8,812,887		6,595,000
Willow Brook (CA)	Pleasant Hill, CA	1985	228	5,055,000		38,387,297		—		826,020		5,055,000		39,213,317		44,268,317		(4,582,228		)	39,686,090		29,000,000
Willow Creek	Fresno, CA	1984	116	275,000		6,639,018		—		800,517		275,000		7,439,535		7,714,535		(1,605,882		)	6,108,654		5,112,000
EQR Partially Owned Encumbered			4,390	64,181,091		367,771,269		—		28,773,904		64,181,091		396,545,174		460,726,265		(71,727,221		)	388,999,044		361,343,204
Portfolio/Entity Encumberances (1)			—	—		—		—		—		—		—		—		—			—		893,451,149
Total Consolidated Investment in Real Estate			151,315	$	3,557,871,695	$	12,601,516,504	$	—	$	1,075,786,914	$	3,557,871,695	$	13,677,303,418	$	17,235,175,113	$	(3,022,479,795	)	$	14,212,695,318	$	3,178,223,172

(1) See attached Encumberances Reconciliation

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ERP OPERATING LIMITED PARTNERSHIP

Schedule III - Real Estate and Accumulated Depreciation

December 31, 2006

NOTES:

(A)	The balance of furniture & fixtures included in the total investment in real estate amount was $812,552,035 as of December 31, 2006.
(B)	The aggregate cost for Federal Income Tax purposes as of December 31, 2006 was approximately $10.2 billion.
(C)	The life to compute depreciation for building is 30 years, for building improvements ranges from 5 to 10 years, for furniture & fixtures and replacements is 5 years, and for in-place leases is the average remaining term of each respective lease.
(D)	This asset consists of various acquisition dates and largely represents furniture, fixtures and equipment, leasehold improvements and capitalized software costs owned by the Management Business, which are generally depreciated over periods ranging from 3 to 7 years.
(E)	Primarily represents capital expenditures for major maintenance and replacements incurred subsequent to each property's acquisition date.
(F)	Represents land, construction-in-progress and/or miscellaneous pursuit costs on projects either held for future development or projects currently under development.
(G)	A portion or all of these properties includes commercial space (retail, parking and/or office space).
(H)	These three properties are pledged as additional collateral in connection with various tax-exempt bond financings.
(I)	Total properties and units exclude both the Partially Owned Properties - Unconsolidated consisting of 45 properties and 10,846 units, and the Military Housing (Fee Managed) consisting of one property and 3,555 units.
(J)	This asset has a new construction loan outstanding but no amounts had yet been drawn as of December 31, 2006.

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