Equity Residential Reports First Quarter Results

    Business Editors

    CHICAGO--(BUSINESS WIRE)--April 26, 2005--Equity Residential (NYSE:EQR) today reported results for the quarter ended March 31, 2005. All per share results are reported on a fully diluted basis.

    First Quarter 2005

    For the quarter ended March 31, 2005, the company reported earnings of $0.74 per share compared to $0.35 per share in the first quarter of 2004. The quarterly increase is primarily attributable to $0.26 per share in higher gains on property sales and the previously announced $0.18 per share gain due to eBay Inc.'s acquisition of the company's ownership in Rent.com. The above amounts are partially offset by the previously announced $0.03 per share in higher executive compensation expense due to the 2006 planned retirement of Bruce W. Duncan, the company's President and CEO, and the resignation of Edward Geraghty, the company's former Eastern Division President, and additional accruals for certain management incentive programs that could increase as a result of the Rent.com gain.
    Funds from Operations (FFO) for the quarter ended March 31, 2005 were $0.74 per share compared to $0.52 per share in the same period of 2004. The increase is primarily attributable to the $0.18 per share associated with the Rent.com sale, $0.03 per share in higher incremental gains on sales of condominium units and $0.03 per share in higher gains on the sale of vacant land parcels, partially offset by the $0.03 per share in higher compensation expense.
    "In the first quarter we saw continuing improvement in our operating fundamentals which were in line with our expectations and should lead to strong performance for the next several years," said Bruce W. Duncan. "But the highlights of the quarter were the opportunities we seized to monetize value through the sale of Water Terrace, vacant land parcels and our interest in Rent.com. Capitalizing on these unique opportunities is just one way in which we demonstrate the value we create for our shareholders everyday."
    Total revenues from continuing operations for the quarter were $488.5 million compared to $439.0 million in the first quarter of 2004. The primary components of this $49.5 million increase in revenues include the properties acquired since January 1, 2004, the interests in the 15 development properties acquired in the first quarter of 2004 from the company's joint venture partners as well as the properties consolidated due to the adoption of FIN 46 effective March 31, 2004.

    "Same-Store" Results

    On a "same-store" first quarter to first quarter comparison, which includes 166,350 units, revenues increased 2.4 percent, expenses increased 4.8 percent and NOI increased 0.8 percent. On a sequential "same-store" comparison for these same 166,350 units from fourth quarter 2004 to first quarter 2005, revenues increased 0.9 percent, expenses increased 2.5 percent and NOI decreased 0.2 percent.

    Acquisitions/Dispositions

    During the first quarter of 2005, the company acquired nine properties, consisting of 2,232 units, for an aggregate purchase price of $284.2 million at an average capitalization (cap) rate of 5.6 percent and a vacant land parcel for $30.3 million.
    Also during the quarter, the company sold 10 properties, consisting of 2,674 units, for an aggregate sale price of $425.3 million at an average cap rate of 4.4 percent. In addition, the company sold 338 condominium units for $92.0 million and sold two vacant land parcels for $36.3 million.

    Second Quarter 2005 Results

    Equity Residential expects to announce second quarter 2005 results on Wednesday, July 27, 2005 and host a conference call to discuss those results at 10:00 a.m. CT that day.

    Equity Residential is the largest publicly traded apartment company in America. Nationwide, Equity Residential owns or has investments in 939 properties, in 32 states and the District of Columbia, consisting of 199,510 units. For more information on Equity Residential, please visit our website at www.equityresidential.com.

    Forward-Looking Statements

    The company lists parameters for 2005 results in the final page of this release. 2005 results will depend upon a slowdown in multifamily starts and economic recovery and job growth. The forward-looking statements contained in this news release regarding 2005 results are further subject to certain risks and uncertainties including, without limitation, the risks described under the heading "Risk Factors" in our Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC) and available on our website, www.equityresidential.com. This news release also contains forward-looking statements concerning development properties. The total number of units and cost of development and completion dates reflect the company's best estimates and are subject to uncertainties arising from changing economic conditions (such as costs of labor and construction materials), completion and local government regulation. The company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

    A live web cast of the company's conference call discussing these results and outlook for 2005 will take place today at 10:00 a.m. Central. Please visit the Investor Information section of the company's web site at www.equityresidential.com for the link. A replay of the web cast will be available for two weeks at this site.

EQUITY RESIDENTIAL CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in thousands except per share data) (Unaudited)

Quarter Ended March 31, --------------------------- 2005 2004 ------------ ------------ REVENUES Rental income $486,007 $435,946 Fee and asset management 2,495 3,007 ------------ ------------

Total revenues 488,502 438,953 ------------ ------------

EXPENSES Property and maintenance 135,784 118,200 Real estate taxes and insurance 53,640 49,821 Property management 20,975 17,286 Fee and asset management 2,519 1,995 Depreciation 127,568 110,110 General and administrative 17,060 10,142 ------------ ------------

Total expenses 357,546 307,554 ------------ ------------

Operating income 130,956 131,399

Interest and other income 60,521 1,968 Interest: Expense incurred, net (90,280) (78,887) Amortization of deferred financing costs (1,586) (1,289) ------------ ------------

Income before allocation to Minority Interests, loss from investments in unconsolidated entities, net gain on sales of unconsolidated entities and discontinued operations 99,611 53,191 Allocation to Minority Interests: Operating Partnership (15,625) (7,640) Preference Interests (3,884) (5,053) Junior Preference Units (4) (31) Partially Owned Properties 1,477 (147) Premium on redemption of Preference Interests (1,728) - Loss from investments in unconsolidated entities (58) (7,406) Net gain on sales of unconsolidated entities 124 2,434 ------------ ------------ Income from continuing operations 79,913 35,348 Net gain on sales of discontinued operations 151,265 71,499 Discontinued operations, net (4,139) 5,134 ------------ ------------ Net income 227,039 111,981 Preferred distributions (13,025) (13,672) ------------ ------------ Net income available to Common Shares $214,014 $98,309 ============ ============

Earnings per share - basic: Income from continuing operations available to Common Shares $0.27 $0.10 ============ ============ Net income available to Common Shares $0.75 $0.35 ============ ============ Weighted average Common Shares outstanding 284,511 277,498 ============ ============

Earnings per share - diluted: Income from continuing operations available to Common Shares $0.27 $0.10 ============ ============ Net income available to Common Shares $0.74 $0.35 ============ ============ Weighted average Common Shares outstanding 308,576 301,781 ============ ============

Distributions declared per Common Share outstanding $0.4325 $0.4325 ============ ============

EQUITY RESIDENTIAL CONSOLIDATED STATEMENTS OF FUNDS FROM OPERATIONS (Amounts in thousands except per share data) (Unaudited)

Quarter Ended March 31, ----------------------- 2005 2004 ---------- ---------- Net income $227,039 $111,981 Allocation to Minority Interests - Operating Partnership 15,625 7,640 Adjustments: Depreciation 127,568 110,110 Depreciation - Non-real estate additions (1,294) (1,300) Depreciation - Partially Owned Properties (1,323) (2,096) Depreciation - Unconsolidated Properties 1,072 6,763 Net (gain) on sales of unconsolidated entities (124) (2,434) Discontinued operations: Depreciation 1,501 7,075 Net (gain) on sales of discontinued operations (151,265) (71,499) Net incremental gain on sales of condominium units 13,675 3,524 Net gain on sales of vacant land 10,368 15 ---------- ----------

FFO (1)(2) 242,842 169,779 Preferred distributions (13,025) (13,672) ---------- ----------

FFO available to Common Shares and OP Units - basic $229,817 $156,107 ========== ==========

FFO available to Common Shares and OP Units - diluted $230,811 $157,100 ========== ==========

FFO per share and OP Unit - basic $0.75 $0.52 ========== ==========

FFO per share and OP Unit - diluted $0.74 $0.52 ========== ==========

Weighted average Common Shares and OP Units outstanding - basic 305,391 299,029 ========== ==========

Weighted average Common Shares and OP Units outstanding - diluted 310,447 304,324 ========== ==========

(1) The National Association of Real Estate Investment Trusts ("NAREIT") defines funds from operations ("FFO") (April 2002 White Paper) as net income (computed in accordance with accounting principles generally accepted in the United States ("GAAP")), excluding gains (or losses) from sales of depreciable property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect funds from operations on the same basis. The April 2002 White Paper states that gain or loss on sales of property is excluded from FFO for previously depreciated operating properties only. Once the Company commences the conversion of units to condominiums, it simultaneously discontinues depreciation of such property. (2) The Company believes that FFO is helpful to investors as a supplemental measure of the operating performance of a real estate company, because it is a recognized measure of performance by the real estate industry and by excluding gains or losses related to dispositions of depreciable property and excluding real estate depreciation (which can vary among owners of identical assets in similar condition based on historical cost accounting and useful life estimates), FFO can help compare the operating performance of a company's real estate between periods or as compared to different companies. FFO in and of itself does not represent net income or net cash flows from operating activities in accordance with GAAP. Therefore, FFO should not be exclusively considered as an alternative to net income or to net cash flows from operating activities as determined by GAAP or as a measure of liquidity. The Company's calculation of FFO may differ from other real estate companies due to, among other items, variations in cost capitalization policies for capital expenditures and, accordingly, may not be comparable to such other real estate companies.

EQUITY RESIDENTIAL CONSOLIDATED BALANCE SHEETS (Amounts in thousands except for share amounts) (Unaudited)

March 31, December 31, 2005 2004 ------------ ------------ ASSETS Investment in real estate Land $2,144,206 $2,183,818 Depreciable property 12,381,279 12,350,900 Construction in progress (including land) 357,826 317,903 ------------ ------------ Investment in real estate 14,883,311 14,852,621 Accumulated depreciation (2,693,176) (2,599,827) ------------ ------------ Investment in real estate, net 12,190,135 12,252,794

Cash and cash equivalents 91,068 83,505 Investments in unconsolidated entities 10,743 11,461 Rents receivable 348 1,681 Deposits - restricted 185,162 82,194 Escrow deposits - mortgage 36,648 35,800 Deferred financing costs, net 33,352 34,986 Goodwill, net 30,000 30,000 Other assets 119,879 112,854 ------------ ------------ Total assets $12,697,335 $12,645,275 ============ ============

LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities: Mortgage notes payable $3,106,010 $3,166,739 Notes, net 3,138,783 3,143,067 Line of credit 163,000 150,000 Accounts payable and accrued expenses 94,281 87,422 Accrued interest payable 63,553 70,411 Rents received in advance and other liabilities 251,817 227,588 Security deposits 49,225 49,501 Distributions payable 143,166 142,437 ------------ ------------ Total liabilities 7,009,835 7,037,165 ------------ ------------

Commitments and contingencies Minority Interests: Operating Partnership 333,225 319,841 Preference Interests 140,000 206,000 Junior Preference Units 184 184 Partially Owned Properties 12,496 9,557 ------------ ------------ Total Minority Interests 485,905 535,582 ------------ ------------

Shareholders' equity: Preferred Shares of beneficial interest, $0.01 par value; 100,000,000 shares authorized; 3,994,533 shares issued and outstanding as of March 31, 2005 and 4,108,658 shares issued and outstanding as of December 31, 2004 633,363 636,216 Common Shares of beneficial interest, $0.01 par value; 1,000,000,000 shares authorized; 286,616,340 shares issued and outstanding as of March 31, 2005 and 285,076,915 shares issued and outstanding as of December 31, 2004 2,866 2,851 Paid in capital 5,150,387 5,112,311 Deferred compensation - (18) Distributions in excess of accumulated earnings (567,401) (657,462) Accumulated other comprehensive loss (17,620) (21,370) ------------ ------------ Total shareholders' equity 5,201,595 5,072,528 ------------ ------------ Total liabilities and shareholders' equity $12,697,335 $12,645,275 ============ ============

First Quarter 2005 vs. First Quarter 2004 Quarter over Quarter Same-Store Results

$ in Millions - 166,350 Same-Store Units

Description Revenues Expenses NOI (1) --------------- -------------- ----------- -------------- Q1 2005 $428.3 $176.7 $251.6 Q1 2004 $418.2 $168.6 $249.6 -------------- ----------- -------------- Change $10.1 $8.1 $2.0 ============== =========== ============== Change 2.4% 4.8% 0.8%

First Quarter 2005 vs. Fourth Quarter 2004 Sequential Quarter over Quarter Same-Store Results

$ in Millions - 166,350 Same-Store Units(a)

Description Revenues Expenses NOI (1) ------------ ----------- ----------- ----------- Q1 2005 $428.3 $176.7 $251.6 Q4 2004 $424.5 $172.4 $252.1 ----------- ----------- ----------- Change $3.8 $4.3 $(0.5) =========== =========== =========== Change 0.9% 2.5% (0.2%)

(a) Includes the same units as the First Quarter 2005 vs. First Quarter 2004 Same Store results for comparability purposes.

Same-Store Occupancy Statistics

Q1 2005 93.5% Q1 2005 93.5% Q1 2004 92.9% Q4 2004 93.3% ------- ------- Change 0.6% Change 0.2%

(1) The Company's primary financial measure for evaluating each of its apartment communities is net operating income ("NOI"). NOI represents rental income less property and maintenance expense, real estate tax and insurance expense, and property management expense. The Company believes that NOI is helpful to investors as a supplemental measure of the operating performance of a real estate company because it is a direct measure of the actual operating results of the Company's apartment communities.

Same Store NOI Reconciliation First Quarter 2005 vs. First Quarter 2004

The following table provides a reconciliation of operating income per the consolidated statements of operations to NOI for the 2005 Same Store Properties:

Quarter Ended March 31, -------------------------- 2005 2004 ----------- ----------- (Amounts in millions)

Operating income $131.0 $131.4 Adjustments: Non-same store operating results (24.1) (1.0) Fee and asset management revenue (2.5) (3.0) Fee and asset management expense 2.5 2.0 Depreciation 127.6 110.1 General and administrative 17.1 10.1

----------- ----------- Same store NOI $251.6 $249.6 =========== ===========

First Quarter 2005 vs. First Quarter 2004 Same-Store Results by Market

Increase (Decrease) from Prior Quarter ---------------------------------------------------------------------- 1Q 2005 1Q 2005 % of Weighted Actual Average Rev- Exp- Markets Units NOI Occupancy% enues enses NOI Occupancy ----------------------------------------------------------------------

1 South Florida 10,158 7.1% 96.0% 6.2% 4.5% 7.4% 1.3% 2 Boston 6,105 6.8% 92.4% (3.6%) 10.7% (11.5%) (1.4%) 3 San Francisco Bay Area 5,990 5.8% 95.2% 1.8% 6.1% (0.4%) 0.5% 4 Los Angeles 4,781 5.3% 94.9% 3.7% 6.5% 2.4% 0.4% 5 Phoenix 9,212 4.8% 94.3% 5.6% 6.7% 4.9% 3.6% 6 Atlanta 9,672 4.3% 93.9% 0.6% 2.0% (0.5%) 0.7% 7 San Diego 4,048 4.3% 94.5% 4.6% 7.8% 3.1% 0.6% 8 Dallas/Ft Worth 9,497 4.2% 94.8% 0.9% 3.3% (1.3%) 2.0% 9 DC Suburban Virginia 4,078 4.0% 93.4% 8.2% 2.5% 11.3% (0.3%) 10 New England (excl Boston) 6,210 3.7% 93.3% 0.4% 7.3% (5.0%) (1.3%) 11 Denver 6,503 3.5% 93.7% (2.5%) 5.6% (6.6%) 1.1% 12 DC Suburban Maryland 5,309 3.5% 92.8% 1.9% 6.1% (0.5%) (1.1%) 13 Seattle/Tacoma 6,290 3.5% 95.1% 3.7% 4.9% 2.9% 1.8% 14 New York Metro Area 2,574 3.1% 94.3% 4.6% 5.5% 4.1% 1.0% 15 Orange Co. 3,013 3.1% 94.8% 5.4% 8.6% 4.0% 0.8% 16 Inland Empire, CA 3,504 3.1% 93.7% 4.8% 9.5% 2.6% (1.9%) 17 Orlando 5,382 3.1% 95.4% 9.7% 3.1% 14.2% 2.4% 18 Portland 4,374 2.3% 94.1% 6.1% 3.5% 8.2% 0.7% 19 Houston 5,282 2.3% 90.8% (3.6%) 2.6% (9.1%) 0.2% 20 Jacksonville 3,917 2.1% 93.8% 4.6% 0.0% 7.6% 2.2% -------------------------------------------------- Top 20 Markets 115,899 79.9% 94.2% 2.7% 5.5% 1.0% 0.8%

All Other Markets 50,451 20.1% 91.9% 1.2% 3.0% (0.2%) (0.2%) -------------------------------------------------- Total 166,350 100.0% 93.5% 2.4% 4.8% 0.8% 0.6% ==================================================

First Quarter 2005 vs. Fourth Quarter 2004(a) Sequential Same-Store Results by Market

Increase (Decrease) from Prior Quarter ---------------------------------------------------------------------- 1Q 2005 1Q 2005 % of Weighted Actual Average Rev- Exp- Markets Units NOI Occupancy% enues enses NOI Occupancy ----------------------------------------------------------------------

1 South Florida 10,158 7.1% 96.0% 3.2% 0.8% 4.9% 1.4% 2 Boston 6,105 6.8% 92.4% (1.4%) 10.9% (8.5%) (0.1%) 3 San Francisco Bay Area 5,990 5.8% 95.2% 0.7% 2.3% (0.1%) 0.0% 4 Los Angeles 4,781 5.3% 94.9% 0.0% 1.9% (0.9%) (0.3%) 5 Phoenix 9,212 4.8% 94.3% 4.4% 1.6% 6.4% 1.9% 6 Atlanta 9,672 4.3% 93.9% 0.5% 2.7% (1.1%) 0.2% 7 San Diego 4,048 4.3% 94.5% 0.0% (0.7%) 0.3% (0.8%) 8 Dallas/Ft Worth 9,497 4.2% 94.8% 0.3% (2.4%) 3.0% 0.3% 9 DC Suburban Virginia 4,078 4.0% 93.4% 2.1% 6.4% 0.1% 0.6% 10 New England (excl Boston) 6,210 3.7% 93.3% 0.0% 11.0% (8.0%) 0.1% 11 Denver 6,503 3.5% 93.7% 2.2% (0.4%) 3.8% 1.4% 12 DC Suburban Maryland 5,309 3.5% 92.8% 1.1% 8.3% (3.1%) (0.3%) 13 Seattle/Tacoma 6,290 3.5% 95.1% 1.3% 3.9% (0.5%) 0.6% 14 New York Metro Area 2,574 3.1% 94.3% 0.2% 5.3% (2.8%) (0.2%) 15 Orange Co 3,013 3.1% 94.8% 0.4% (0.2%) 0.8% (0.3%) 16 Inland Empire, CA 3,504 3.1% 93.7% 0.8% 2.8% (0.1%) 0.0% 17 Orlando 5,382 3.1% 95.4% 1.9% 2.9% 1.2% (0.5%) 18 Portland 4,374 2.3% 94.1% 3.3% 0.8% 5.3% 1.2% 19 Houston 5,282 2.3% 90.8% (1.2%) (0.7%) (1.7%) (0.2%) 20 Jacksonville 3,917 2.1% 93.8% 2.6% (2.1%) 5.7% 1.2% -------------------------------------------------- Top 20 Markets 115,899 79.9% 94.2% 1.0% 3.0% (0.2%) 0.4%

All Other Markets 50,451 20.1% 91.9% 0.3% 1.3% (0.5%) (0.3%) -------------------------------------------------- Total 166,350 100.0% 93.5% 0.9% 2.5% (0.2%) 0.2% ==================================================

(a) Includes the same units as the First Quarter 2005 vs. Fourth Quarter 2004 Same Store results for comparability purposes.

Portfolio as of March 31, 2005

Properties Units ------------ ------------

Wholly Owned Properties 843 176,423 Partially Owned Properties (Consolidated) 39 6,929 Unconsolidated Properties 57 16,158 ------------ ------------ 939 199,510

Portfolio Rollforward 2005

Properties Units $Millions Cap Rate ---------- ---------- --------- --------

At December 31, 2004 939 200,149 Acquisitions: Rental Properties 9 2,232 $284.2 5.6% Vacant Land - - $30.3 Dispositions: Rental Properties (1) (10) (2,674) $(425.3) 4.4% Condominium Units - (338) $(92.0) Vacant Land - - $(36.3) Completed Developments 1 141 ---------- ----------- At March 31, 2005 939 199,510

(1) Cap rate was 6.5% excluding the sale of Water Terrace.

Portfolio Summary As of March 31, 2005

Market Properties Units % of % of 2005 Units NOI Budget

Boston 35 6,434 3.2% 5.7% DC Northern Virginia 17 5,576 2.8% 4.9% New York Metro Area 13 3,642 1.8% 4.4% New England (excluding Boston) 45 6,118 3.1% 3.6% DC Suburban Maryland 26 5,617 2.8% 3.3% --------------------------------------- Atlantic Region 136 27,387 13.7% 21.9%

South Florida 50 11,232 5.6% 6.5% Orlando 32 6,898 3.5% 3.6% North Florida 47 6,656 3.3% 2.5% Tampa/Ft Myers 27 4,694 2.4% 1.7% --------------------------------------- Florida Region 156 29,480 14.8% 14.2%

Raleigh/Durham 18 4,575 2.3% 1.6% Charlotte 12 3,701 1.9% 1.1% --------------------------------------- Carolina Region 30 8,276 4.1% 2.6%

Atlanta 63 13,292 6.7% 5.2% Birmingham 1 240 0.1% 0.0% --------------------------------------- Georgia Region 64 13,532 6.8% 5.3%

Minneapolis/St Paul 18 3,982 2.0% 1.9% Chicago 9 3,241 1.6% 1.6% Southeastern Michigan 21 2,845 1.4% 1.2% Nashville 11 2,729 1.4% 1.0% Columbus 31 3,415 1.7% 0.8% Indianapolis 29 3,056 1.5% 0.7% Northern Ohio 25 2,692 1.3% 0.7% Southern Ohio 22 1,865 0.9% 0.5% Milwaukee 3 686 0.3% 0.4% Lexington 7 656 0.3% 0.2% St Louis 3 582 0.3% 0.2% Memphis 1 568 0.3% 0.2% Louisville 8 608 0.3% 0.1% --------------------------------------- Midwest Region 188 26,925 13.5% 9.5%

Lexford Other 45 3,805 1.9% 1.0%

Dallas/Ft Worth 37 11,114 5.6% 3.8% Houston 17 5,282 2.6% 1.9% Austin 13 3,867 1.9% 1.3% Tulsa 8 2,036 1.0% 0.5% San Antonio 6 1,861 0.9% 0.4% Kansas City 1 288 0.1% 0.2% --------------------------------------- Texas Region 82 24,448 12.3% 8.1%

Phoenix 38 10,852 5.4% 4.5% Tucson 2 558 0.3% 0.1% Albuquerque 2 369 0.2% 0.1% --------------------------------------- Arizona Region 42 11,779 5.9% 4.6%

Denver 28 8,692 4.4% 4.1% --------------------------------------- Colorado Region 28 8,692 4.4% 4.1%

Los Angeles 30 6,337 3.2% 6.2% San Diego 13 4,048 2.0% 4.0% Inland Empire, CA 11 3,504 1.8% 2.9% Orange County, CA 8 3,013 1.5% 2.9% --------------------------------------- Southern Cal Region 62 16,902 8.5% 16.0%

San Francisco Bay Area 26 6,249 3.1% 4.9% Central Valley CA 10 1,595 0.8% 0.5% --------------------------------------- Northern Cal Region 36 7,844 3.9% 5.4%

Seattle 37 7,611 3.8% 3.9% Portland OR 13 4,678 2.3% 2.1% Tacoma 7 2,341 1.2% 1.0% --------------------------------------- Washington Region 57 14,630 7.3% 7.0% --------------------------------------- Total 926 193,700 97.1% 99.7% Condominium Conversion 12 2,009 1.0% 0.3% Ft. Lewis - Military Housing 1 3,801 1.9% 0.0% --------------------------------------- Grand Total 939 199,510 100.0% 100.0%

Debt Summary as of March 31, 2005

Weighted Average $ Millions (1) Rate (1) -------------- ---------

Secured $3,106 5.54% Unsecured 3,302 5.98% -------------- --------- Total $6,408 5.77%

Fixed Rate $5,071 6.46% Floating Rate 1,337 3.18% -------------- --------- Total $6,408 5.77%

Above Totals Include: --------------------- Tax Exempt: Fixed $286 3.68% Floating 508 2.40% -------------- --------- Total $794 2.84%

Unsecured Revolving Credit Facility $163 2.34%

(1) Net of the effect of any derivative instruments.

Debt Maturity Schedule as of March 31, 2005

Year $ Millions % of Total ------- ------------ --------------

2005 $324 5.1% 2006 (2) 476 7.4% 2007 423 6.6% 2008 (3) 780 12.2% 2009 831 13.0% 2010 233 3.6% 2011 717 11.2% 2012 470 7.3% 2013 429 6.7% 2014+ (4) 1,725 26.9% ------------ -------------- Total $6,408 100.0%

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

(3) Includes $163 million outstanding on the Company's unsecured revolving credit facility. The Company entered into a new credit facility on April 1, 2005 that matures on May 29, 2008.

(4) Includes $300 million of unsecured debt with a final maturity of 2015 that was putable/callable on April 13, 2005. Debt was subsequently remarketed and remains outstanding until April 13, 2015.

Selected Unsecured Public Debt Covenants

March 31, 2005 -----------

Total Debt to Adjusted Total Assets (not to exceed 60%) 41.8%

Secured Debt to Adjusted Total Assets (not to exceed 40%) 20.2%

Consolidated Income Available For Debt Service To Maximum Annual Service Charges (must be at least 1.5 to 1) 2.95

Total Unsecured Assets to Unsecured Debt (must be at least 150%) 299.8%

These selected covenants relate to ERP Operating Limited Partnership's ("ERPOP") outstanding unsecured public debt. Equity Residential is the general partner of ERPOP. The terms are defined in the original indenture.

Market Capitalization as of March 31, 2005

Total Debt $6,407,793,619

Common Shares & OP Units 307,523,255 Common Share Equivalents 1,841,321 ------------- Total outstanding at quarter-end 309,364,576 Common Share Price at March 31, 2005 $32.21 ------------- 9,964,632,993 Perpetual Preferred Shares Liquidation Value 615,000,000 Perpetual Preference Interests Liquidation Value 105,500,000 ---------------- Total Market Capitalization $17,092,926,612

Total Debt/Total Market Capitalization 37%

Common Share and Operating Partnership Unit (OP Unit) Weighted Average Amounts Outstanding

1Q05 1Q04 ------------ ------------

Weighted Average Amounts Outstanding for Net Income Purposes: Common Shares - basic 284,510,654 277,497,681 Shares issuable from assumed conversion/vesting of: - OP Units 20,880,456 21,531,014 - share options/restricted shares 3,184,776 2,752,750 ------------ ------------ Total Common Shares and OP Units - diluted 308,575,886 301,781,445

Weighted Average Amounts Outstanding for FFO Purposes: OP Units - basic 20,880,456 21,531,014 Common Shares - basic 284,510,654 277,497,681 ------------ ------------ Total Common Shares and OP Units - basic 305,391,110 299,028,695 Shares issuable from assumed conversion/vesting of: - convertible preferred shares/units 1,871,194 2,542,290 - share options/restricted shares 3,184,776 2,752,750 ------------ ------------ Total Common Shares and OP Units - diluted 310,447,080 304,323,735

Period Ending Amounts Outstanding: OP Units 20,906,915 Common Shares 286,616,340 ------------ Total Common Shares and OP Units 307,523,255

Unconsolidated Entities as of March 31, 2005 (Amounts in thousands except for project and unit amounts)

Institutional Joint Lexford / Ventures Other Totals --------------- --------- ---------

Total projects 45 11 56 (1) --------------- --------- ---------

Total units 10,846 1,511 12,357 (1) --------------- --------- ---------

Company's ownership percentage of outstanding debt 25.0% 10.7%

Company's share of outstanding debt (2) $121,200 $2,983 $124,183 --------------- --------- ---------

Operating information for the three-months ended 3/31/05 (at 100%): Operating revenue $23,091 $2,231 $25,322 Operating expenses 10,255 1,134 11,389 --------------- --------- --------- Net operating income 12,836 1,097 13,933 Depreciation 5,470 487 5,957 Other 76 1 77 --------------- --------- --------- Operating income 7,290 609 7,899 Interest and other income 74 7 81 Interest: Expense incurred, net (9,361) (531) (9,892) Amortization of deferred financing costs (154) (47) (201) --------------- --------- --------- Net (loss) income $(2,151) $38 $(2,113) =============== ========= =========

(1) Totals exclude Fort Lewis Military Housing consisting of one property and 3,801 units, which is not accounted for under the equity method of accounting, but is included in the Company's property/unit counts at March 31, 2005.

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

Consolidated Development Projects as of March 31, 2005 (Amounts in thousands except for project and unit amounts)

Total Total Book No. of Capital Value To Projects Location Units Cost (1) Date (1) (2) ----------------------------------------------------------------------

Projects Under Development -------------------------- 2400 M St Washington, D.C. 359 $111,947 $73,554 Union Station Los Angeles, CA 278 57,727 27,262 Indian Ridge Waltham, MA 264 47,032 32,221 Bella Vista III (3) Woodland Hills, CA 264 70,179 21,716 --------------------------------

Total Projects Under Development 1,165 286,885 154,753

Completed Not Stabilized: ------------------------- 1210 Massachusetts Ave. (Sovereign Park) Washington, D.C. 144 39,702 39,401 City View at the Highlands (3) Lombard, IL 403 65,539 65,281 City Place (Westport) (3) Kansas City, MO 288 33,791 33,791 Marina Bay II (3) Quincy, MA 108 23,480 23,271 --------------------------------

Total Projects Completed Not Stabilized 943 162,512 161,744

Completed And Stabilized During the Quarter: ----------------------------------- Bella Vista I & II (Warner Ridge) (3) Woodland Hills, CA 315 80,112 77,238 --------------------------------

Total Projects Completed And Stabilized During the Quarter 315 80,112 77,238 --------------------------------

Total Projects 2,423 $529,509 $393,735 ================================

Percentage Percentage Percentage Projects Location Completed Leased Occupied ----------------------------------------------------------------------

Projects Under Development -------------------------- 2400 M St Washington, D.C. 66% - - Union Station Los Angeles, CA 47% - - Indian Ridge Waltham, MA 69% - - Bella Vista III (3) Woodland Hills, CA 6% - -

Completed Not Stabilized: ------------------------- 1210 Massachusetts Ave. (Sovereign Park) Washington, D.C. 100% 46% 39% City View at the Highlands (3) Lombard, IL 100% 87% 83% City Place (Westport) (3) Kansas City, MO 100% 98% 94% Marina Bay II (3) Quincy, MA 100% 53% 53%

Completed And Stabilized During the Quarter: ----------------------------------- Bella Vista I & II (Warner Ridge) (3) Woodland Hills, CA 100% 93% 93%

Estimated Completion Estimated Projects Location Date Stabilization Date ----------------------------------------------------------------------

Projects Under Development -------------------------- 2400 M St Washington, D.C. 1Q 2006 3Q 2007 Union Station Los Angeles, CA 4Q 2005 4Q 2006 Indian Ridge Waltham, MA 4Q 2005 4Q 2006 Bella Vista III (3) Woodland Hills, CA 4Q 2006 3Q 2007

Completed Not Stabilized: ------------------------- 1210 Massachusetts Ave. (Sovereign Park) Washington, D.C. Completed 4Q 2005 City View at the Highlands (3) Lombard, IL Completed 3Q 2005 City Place (Westport) (3) Kansas City, MO Completed 2Q 2005 Marina Bay II (3) Quincy, MA Completed 4Q 2005

Completed And Stabilized During the Quarter: ------------------------------------- Bella Vista I & II (Warner Ridge) (3) Woodland Hills, CA Completed 2Q 2004/1Q 2005

Total Capital Q1 2005 NOI CONTRIBUTION FROM DEVELOPMENT PROJECTS Cost (1) NOI ------------------------- Projects Under Development $286,885 $- Completed Not Stabilized 162,512 1,169 Completed And Stabilized During the Quarter 80,112 1,092 ------------------------- Total Development/Newly Stabilized NOI Contribution $529,509 $2,261 =========================

(1) Total capital cost represents estimated development cost for projects under development and all capitalized costs incurred to date plus any estimates of costs remaining to be funded for all completed projects. Total capital cost and total book value to date exclude purchase consideration paid to the development partner of $1.0 million on Bella Vista I & II.

(2) Of the total book value to date, $239.0 million has been transferred to land and depreciable property and $154.7 million is currently reflected as construction in progress ("CIP"). The remaining $203.1 million of CIP represents land held for future development and related costs. Of the $135.8 million remaining to be invested, $83.7 million will be funded through third party construction mortgages.

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

Consolidated Condominium Conversion Projects as of March 31, 2005 (Amounts in thousands except for project and unit amounts)

Units ----------------------------- Available for Sale ---------------- Project Estimated Sold Start Close Out Units Not Avail- Projects Location Date Date Total Closed Closed able ----------------------------------------------------------------------

For Sale ---------- Four Lakes Lisle, IL Q4 2001 Q4 2005 942 677 21 244 Country Club Mill Creek, Estates WA Q1 2004 Q3 2005 151 105 27 19 Sterling Bellevue, Heights WA Q2 2004 Q3 2005 116 87 17 12 Magnuson Pointe Seattle, WA Q1 2005 Q2 2006 104 - - 104 Timber Woodin- Ridge ville, WA Q1 2005 Q1 2007 203 - - 203 Venetian I & II Phoenix, AZ Q1 2004 Q3 2005 264 94 7 163 Verona Scottsdale, AZ Q2 2004 Q2 2005 108 - 108 - Tuscany Scottsdale, Villas AZ Q4 2004 Q2 2006 180 - - 180 Grand Coral Oasis Springs, FL Q2 2004 Q2 2005 198 193 5 - Grand Plantation, Marquis FL Q4 2004 Q1 2006 198 - 99 99 Fairway Pembroke Greens Pines, FL Q1 2005 Q2 2006 152 - - 152 Radius at Logan Washington, Circle (1) DC Q2 2004 Q2 2005 170 166 - 4 Watermarke (1) Irvine, CA Q3 2004 Q4 2006 535 131 70 334 Atlas (1) Washington, DC Q4 2004 Q4 2005 141 - - 141 -----------------------------

3,462 1,453 354 1,655

Sold Out ---------- Barcelona Scottsdale, AZ Q3 2003 Q3 2004 96 96 - - Balaton Lake Forest Park, WA Q3 2003 Q3 2004 108 108 - - -----------------------------

204 204 - -

Totals 16 3,666 1,657 354 1,655 =============================

2005 YTD Activity -----------------------------

FFO Project Estimated Incremental Start Close Out Units Sales Gain on Projects Location Date Date Closed Price Sale ----------------------------------------------------------------------

For Sale ---------- Four Lakes Lisle, IL Q4 2001 Q4 2005 30 $4,365 $273 Country Club Mill Creek, Estates WA Q1 2004 Q3 2005 40 6,942 1,247 Sterling Bellevue, Heights WA Q2 2004 Q3 2005 47 9,348 1,567 Magnuson Pointe Seattle, WA Q1 2005 Q2 2006 - - - Timber Woodin- Ridge ville, WA Q1 2005 Q1 2007 - - - Venetian I & II Phoenix, AZ Q1 2004 Q3 2005 1 158 6 Verona Scottsdale, AZ Q2 2004 Q2 2005 - - - Tuscany Scottsdale, Villas AZ Q4 2004 Q2 2006 - - - Grand Coral Oasis Springs, FL Q2 2004 Q2 2005 84 12,148 3,489 Grand Plantation, Marquis FL Q4 2004 Q1 2006 - - - Fairway Pembroke Greens Pines, FL Q1 2005 Q2 2006 - - - Radius at Logan Washington, Circle (1) DC Q2 2004 Q2 2005 50 20,084 3,033 Watermarke (1) Irvine, CA Q3 2004 Q4 2006 86 38,911 4,130 Atlas (1) Washington, DC Q4 2004 Q4 2005 - - - -----------------------------

338 91,956 13,745

Sold Out ---------- Barcelona Scottsdale, AZ Q3 2003 Q3 2004 - - (68) Balaton Lake Forest Park, WA Q3 2003 Q3 2004 - - (2) -----------------------------

- - (70)

Totals 16 338 $91,956 $13,675 =============================

Net incremental gain on sales of condominium units $13,675 Property management and general and administrative expenses (876) Discontinued operating income 363 ------------

Net Income - Condominium Division (2) $13,162 ============

(1) Partially owned projects; incremental gain on sale represents portion attributable to the Company.

(2) Excludes interest income and interest expense specific to condominium conversion projects.

Maintenance Expenses and Capitalized Improvements to Real Estate For the Three Months Ended March 31, 2005 (Amounts in thousands except for unit and per unit amounts)

-------------------------------------------- Maintenance Expenses --------------------------------------------

Total Avg. Avg. Avg. Units Expense Per Payroll Per Per (1) (2) Unit (3) Unit Total Unit -------- -------------- -------------- --------------

Established Properties (6) 155,625 $21,458 $138 $21,531 $138 $42,989 $276

New Acquisition Properties (7) 19,034 2,928 165 2,466 139 5,394 304

Other (8) 8,693 2,272 1,840 4,112 -------- -------- -------- --------

Total 183,352 $26,658 $25,837 $52,495 ======== ======== ======== ========

----------------------------------------------------- Capitalized Improvements to Real Estate -----------------------------------------------------

Avg. Building Avg. Avg. Replacements Per Improvements Per Per (4) Unit (5) Unit Total Unit -------------------- ----------------- --------------

Established Properties (6) $11,664 $75 $14,015 $90 $25,679 $165

New Acquisition Properties (7) 942 53 2,552 144 3,494 197

Other (8) 4,274 4,827 9,101 -------------- ----------- --------

Total $16,880 $21,394 $38,274 ============== =========== ========

------------------------ Total Expenditures ------------------------

Avg. Per Grand Total Unit ------------------------

Established Properties (6) $68,668 $441

New Acquisition Properties (7) 8,888 501

Other (8) 13,213 -------------

Total $90,769 =============

(1) Total units exclude 16,158 unconsolidated units.

(2) Maintenance expenses include general maintenance costs, unit turnover costs including interior painting, regularly scheduled landscaping and tree trimming costs, security, exterminating, fire protection, snow and ice removal, elevator repairs, and other miscellaneous building repair costs.

(3) Maintenance payroll includes employee costs for maintenance, cleaning, housekeeping, and landscaping.

(4) Replacements include new expenditures inside the units such as carpets, appliances, mechanical equipment, fixtures and vinyl flooring.

(5) Building improvements include roof replacement, paving, amenities and common areas, building mechanical equipment systems, exterior painting and siding, major landscaping, vehicles and office and maintenance equipment.

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

(7) Wholly Owned Properties acquired during 2003, 2004 and 2005. Per unit amounts are based on a weighted average of 17,748 units.

(8) Includes properties either Partially Owned or sold during the period, commercial space, condominium conversions and $0.8 million included in building improvements spent on four specific assets related to major renovations and repositioning of these assets.

Discontinued Operations (Amounts in thousands)

Quarter Ended March 31, ------------------------- 2005 2004 -------------------------

REVENUES Rental income $8,205 $29,148 ------------ ------------ Total revenues 8,205 29,148 ------------ ------------

EXPENSES (1) Property and maintenance 4,476 12,118 Real estate taxes and insurance 2,677 3,254 Property management 82 - Depreciation 1,500 7,075 ------------ ------------ Total expenses 8,735 22,447 ------------ ------------

Discontinued operating income (loss) (530) 6,701

Interest and other income 35 160 Interest: Expense incurred, net (3,418) (1,426) Amortization of deferred financing costs (226) (301) ------------ ------------ Discontinued operations, net $(4,139) $5,134 ============ ============

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

As a result of the Securities and Exchange Commission's Regulation FD, the Company will provide earnings guidance in its quarterly earnings release. These projections are based on current expectations and are forward-looking.

2005 Earnings Guidance (per share diluted) ------------------------------------------

Q2 2005 2005 ---------------- ----------------

Expected EPS (1) (3) $0.36 to $0.38 $2.01 to $2.11 Add: Expected depreciation expense 0.41 1.62 Less: Expected net gain on sales (1) (0.23) (1.20)

---------------- ---------------- Expected FFO (2) (3) $0.54 to $0.56 $2.43 to $2.53 ================ ================

Same-Store Assumptions ----------------------

2005 ----------------

Physical occupancy 94.0%

Revenue change 2.00% to 3.25%

Expense change 3.6% to 5.0%

NOI change 0.0% to 3.0%

Acquisitions $1.0 billion

Dispositions $1.0 billion

(1) Earnings per share ("EPS") represents net income per share calculated in accordance with accounting principles generally accepted in the United States. Expected EPS is calculated on a basis consistent with actual EPS. Due to the uncertain timing and extent of property dispositions and the resulting gains/losses on sales, actual EPS could differ materially from expected EPS.

(2) 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), 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. Expected FFO is calculated on a basis consistent with actual FFO.

(3) Q1 2005 and full year 2005 include $0.21 per share of non-recurring realized gain on sale of vacant land($0.03) and eBay, Inc.'s acquisition of the Company's ownership in Rent.com ($0.18).

--30--DDT/sf*

CONTACT: Equity Residential Marty McKenna, 312-928-1901

KEYWORD: ILLINOIS INDUSTRY KEYWORD: REAL ESTATE BUILDING/CONSTRUCTION EARNINGS CONFERENCE CALLS SOURCE: Equity Residential

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