Equity Residential Reports Second Quarter 2009 Results

Equity Residential (NYSE: EQR) today reported results for the quarter and six months ended June 30, 2009. All per share results are reported on a fully-diluted basis.

"We are pleased to deliver better than expected second quarter results as well as forecast modestly higher same store net operating income for the year than we originally thought,” said David J. Neithercut, Equity Residential’s President and CEO. "While lower operating expenses are the major contributor to our improved forecast, we are pleased that our revenue expectation for the year is essentially unchanged because our commitment to resident satisfaction is enabling us to retain existing residents at renewal rents higher than might have been expected in this extremely difficult economic climate.”

Second Quarter 2009

For the second quarter of 2009, the company reported earnings per share of $0.35 compared to earnings of $0.46 per share in the second quarter of 2008. The difference is primarily due to lower gains from property sales caused by lower property sales volume in 2009 and lower property net operating income (NOI) and a development-related impairment charge, which are both discussed below.

Funds from Operations (FFO) for the quarter ended June 30, 2009 was $0.58 per share compared to $0.64 per share in the same period of 2008. The difference is due primarily to:

• the net negative impact of approximately $0.05 per share from lower total NOI from the company’s same store portfolio and dilution from 2008 and 2009 transaction activity, partially offset by the positive impact of NOI from lease-up activity;
• the negative impact of approximately $0.04 per share from a non-cash charge of $11.1 million to reflect impairment in the value of a land parcel; and
• the net positive impact of approximately $0.03 per share due to lower interest expense, higher interest and other income and certain other non-comparable items listed on page 23 of this release.

Six Months Ended June 30, 2009

For the six months ended June 30, 2009, the company reported earnings of $0.64 per share compared to $0.96 per share in the same period of 2008.

FFO for the six months ended June 30, 2009 was $1.16 per share compared to $1.22 per share in the same period of 2008.

Same Store Results

On a same store second quarter to second quarter comparison, which includes 121,256 apartment units, revenues decreased 2.4%, expenses decreased 0.6% and NOI decreased 3.4%. The revenue decrease was due to a 1.2% decrease in average rental rate and a 1.2% decrease in occupancy to 93.7%. The expense decrease was primarily due to a 2.8% decrease in utility expense and a 0.8% decrease in payroll.

On a same store six-month to six-month comparison, which includes 120,452 apartment units, revenues decreased 1.3%, expenses increased 1.1% and NOI decreased 2.8%.

Acquisitions/Dispositions

During the second quarter of 2009, the company sold 12 properties, consisting of 2,668 apartment units, for an aggregate sale price of $213.8 million at a weighted average capitalization (cap) rate of 7.6% generating an unlevered internal rate of return (IRR) of 9.7%. The company acquired no properties during the second quarter of 2009.

During the first six months of 2009, the company sold 23 consolidated properties, consisting of 4,199 apartment units, for an aggregate sale price of $353.4 million at a weighted average cap rate of 7.4% generating an unlevered IRR of 10.2%. The company acquired no properties during the first six months of 2009.

Liquidity

On June 29, 2009, the company closed a $500.0 million secured loan with Freddie Mac (NYSE: FRE), originated by Deutsche Bank Berkshire Mortgage. The loan is interest only and matures in eleven years with the first ten years fixed and the final year at a floating rate of interest. The loan, which is collateralized with thirteen assets in seven markets, has an all-in effective interest rate of approximately 5.6%. The closing of this loan continues the company's strategy of maintaining excellent liquidity and addressing funding obligations well before loan maturities.

The company currently has $565.0 million in unrestricted cash or securities readily convertible to cash, inclusive of the secured loan proceeds, and $1.35 billion available on its unsecured revolving credit facility. With current cash on hand, the company can meet all of its 2009 and 2010 debt maturities and development obligations. Inclusive of current cash on hand, the unsecured revolving credit facility and net disposition proceeds for 2009 as provided in current guidance, the company can meet all of its obligations through 2011.

Expected Dividend Reduction

The company expects to reduce its quarterly common share dividend, beginning with the dividend for the third quarter of 2009, from $0.4825 per share (an annual rate of $1.93 per share) to $0.3375 per share (an annual rate of $1.35 per share).

"We expect to take this step as a result of reductions in our cash flow from ongoing operations and also to position the company to take advantage of opportunities that may lie ahead,” said Mr. Neithercut.

Third Quarter 2009 Guidance

The company has established an FFO guidance range of $0.49 to $0.53 per share for the third quarter of 2009. The difference between the company’s actual pre-impairment second quarter 2009 FFO of $0.62 per share and the midpoint of the range for the third quarter is primarily attributable to:

• the negative impact of approximately $0.07 per share from lower NOI from the company’s same store portfolio as well as dilution from 2009 transaction activity;
• the negative impact of approximately $0.02 per share from increased interest expense due to higher debt balances as a result of the company’s recent $500.0 million loan from Freddie Mac and lower capitalized interest due to reduced development activity; and
• the negative impact of approximately $0.02 per share from lower interest and other income in the third quarter.

Full Year 2009 Guidance

The company has revised its guidance for its full year 2009 same store operating performance, funds from operations results and transactions activities as well as other items listed on page 24 of this release. The changes to the full year same store and FFO guidance are listed below:

			Previous				Revised
Same store:
Revenue change			(4.5%) to (1.5%)				(3.5%) to (3.0%)
Expense change			2.5% to 3.5%				1.25% to 1.75%
NOI change			(9.25%) to (3.75%)				(6.5%) to (5.5%)
FFO per share			$2.00 to $2.30				$2.10 to $2.20

The guidance midpoint for the company’s full year 2009 FFO remains the same as the company’s previous guidance due to higher than expected property NOI and higher interest and other income offset by the impairment charge. Annual interest expense is largely unchanged as higher expense due to the $500.0 million loan from Freddie Mac is offset by lower than anticipated rates on the company’s floating rate debt.

Third Quarter 2009 Conference Call

Equity Residential expects to announce third quarter 2009 results on Wednesday, October 28, 2009 and host a conference call to discuss those results at 10:00 a.m. CT on Thursday, October 29, 2009.

Equity Residential is an S&P 500 company focused on the acquisition, development and management of high quality apartment properties in top U.S. growth markets. Equity Residential owns or has investments in 526 properties located in 23 states and the District of Columbia, consisting of 143,856 apartment units. For more information on Equity Residential, please visit our website at www.equityresidential.com.

Forward-Looking Statements

In addition to historical information, this press release contains forward-looking statements and information within the meaning of the federal securities laws. These statements are based on current expectations, estimates, projections and assumptions made by management. While Equity Residential’s management believes the assumptions underlying its forward-looking statements are reasonable, such information is inherently subject to uncertainties and may involve certain risks, including, without limitation, changes in general market conditions, including the rate of job growth and cost of labor and construction material, the level of new multifamily construction and development, competition and local government regulation. Other risks and uncertainties are described under the heading "Risk Factors” in our Annual Report on Form 10-K and subsequent periodic reports filed with the Securities and Exchange Commission (SEC) and available on our website, www.equityresidential.com. 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. Equity Residential 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 2009 will take place tomorrow, Thursday, July 30, at 10:00 a.m. Central. Please visit the Investor Information section of the company’s website 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)
				Six Months Ended June 30,										Quarter Ended June 30,
				2009				2008						2009				2008
REVENUES
	Rental income			$	1,007,540			$	1,003,532					$	502,738			$	510,567
	Fee and asset management				5,275				5,010						2,412				2,716
		Total revenues			1,012,815				1,008,542						505,150				513,283
EXPENSES
	Property and maintenance				254,977				261,248						123,430				130,402
	Real estate taxes and insurance				108,799				103,884						53,824				51,457
	Property management				37,732				40,667						18,718				19,491
	Fee and asset management				3,985				4,171						1,982				1,991
	Depreciation				298,194				279,253						149,909				139,812
	General and administrative				20,595				24,191						10,201				11,774
	Impairment				11,124				-						11,124				-
		Total expenses			735,406				713,414						369,188				354,927
Operating income					277,409				295,128						135,962				158,356
	Interest and other income				12,639				8,167						6,622				4,808
	Other expenses				(306	)			(780	)					(14	)			(604	)
	Interest:
		Expense incurred, net			(239,565	)			(238,780	)					(115,866	)			(119,511	)
		Amortization of deferred financing costs			(6,220	)			(4,338	)					(3,255	)			(2,178	)
Income before income and other taxes, (loss) from investments in
	unconsolidated entities, net gain (loss) on sales of unconsolidated
	entities and discontinued operations				43,957				59,397						23,449				40,871
Income and other tax (expense) benefit					(2,389	)			(4,622	)					(259	)			(1,628	)
(Loss) from investments in unconsolidated entities					(2,221	)			(190	)					(2,026	)			(95	)
Net gain (loss) on sales of unconsolidated entities					2,759				-						(6	)			-
Income from continuing operations					42,106				54,585						21,158				39,148
Discontinued operations, net					149,247				232,936						84,774				100,845
Net income					191,353				287,521						105,932				139,993
Net (income) loss attributable to Noncontrolling Interests:
	Operating Partnership				(10,420	)			(17,481	)					(5,729	)			(8,348	)
	Preference Interests and Units				(7	)			(7	)					(3	)			(3	)
	Partially Owned Properties				74				(1,659	)					5				(1,391	)
Net income attributable to controlling interests					181,000				268,374						100,205				130,251
Preferred distributions					(7,240	)			(7,259	)					(3,620	)			(3,626	)
Net income available to Common Shares				$	173,760			$	261,115					$	96,585			$	126,625
Earnings per share – basic:
Income from continuing operations available to Common Shares				$	0.12			$	0.16					$	0.06			$	0.12
Net income available to Common Shares				$	0.64			$	0.97					$	0.35			$	0.47
Weighted average Common Shares outstanding					272,614				269,196						272,901				269,608
Earnings per share – diluted:
Income from continuing operations available to Common Shares				$	0.12			$	0.16					$	0.06			$	0.12
Net income available to Common Shares				$	0.64			$	0.96					$	0.35			$	0.46
Weighted average Common Shares outstanding					289,152				289,921						289,338				290,445
Distributions declared per Common Share outstanding				$	0.9650			$	0.9650					$	0.4825			$	0.4825

Equity Residential
Consolidated Statements of Funds From Operations
(Amounts in thousands except per share data)
(Unaudited)
				Six Months Ended June 30,										Quarter Ended June 30,
				2009 (3)				2008 (3)						2009 (3)				2008 (3)
Net income				$	191,353			$	287,521					$	105,932			$	139,993
Adjustments:
	Net (income) loss attributable to Noncontrolling Interests:
		Preference Interests and Units			(7	)			(7	)					(3	)			(3	)
		Partially Owned Properties			74				(1,659	)					5				(1,391	)
	Depreciation				298,194				279,253						149,909				139,812
	Depreciation – Non-real estate additions				(3,792	)			(4,081	)					(1,894	)			(2,030	)
	Depreciation – Partially Owned and Unconsolidated Properties				431				2,040						248				1,006
	Net (gain) loss on sales of unconsolidated entities				(2,759	)			-						6				-
	Discontinued operations:
		Depreciation			3,641				14,921						1,438				6,782
		Net gain on sales of discontinued operations			(145,798	)			(214,797	)					(83,927	)			(92,280	)
		Net incremental gain (loss) on sales of condominium units			335				(3,090	)					399				(3,456	)
FFO (1) (2)					341,672				360,101						172,113				188,433
Preferred distributions					(7,240	)			(7,259	)					(3,620	)			(3,626	)
FFO available to Common Shares and Units – basic (1) (2)				$	334,432			$	352,842					$	168,493			$	184,807
FFO available to Common Shares and Units – diluted (1) (2)				$	334,747			$	353,183					$	168,651			$	184,975
FFO per share and Unit – basic				$	1.16			$	1.23					$	0.58			$	0.64
FFO per share and Unit – diluted				$	1.16			$	1.22					$	0.58			$	0.64
Weighted average Common Shares and
	Units outstanding – basic				288,851				287,260						288,990				287,440
Weighted average Common Shares and
	Units outstanding – diluted				289,558				290,360						289,743				290,878

(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.  FFO available to Common Shares and Units is calculated on a basis consistent with net income available to Common Shares and reflects adjustments to net income for preferred distributions and premiums on redemption of preferred shares in accordance with accounting principles generally accepted in the United States.  The equity positions of various individuals and entities that contributed their properties to the Operating Partnership in exchange for OP Units are collectively referred to as the "Noncontrolling Interests - Operating Partnership".  Subject to certain restrictions, the Noncontrolling Interests - Operating Partnership may exchange their OP Units for EQR Common Shares on a one-for-one basis.
(2)		The Company believes that FFO and FFO available to Common Shares and 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 Common Shares and 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 Common Shares and Units do not represent net income, net income available to Common Shares or net cash flows from operating activities in accordance with GAAP.  Therefore, FFO and FFO available to Common Shares and Units should not be exclusively considered as alternatives to net income, net income available to Common Shares or net cash flows from operating activities as determined by GAAP or as a measure of liquidity.  The Company's calculation of FFO and FFO available to Common Shares and 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)		On January 1, 2009, the Company adopted FSP APB 14-1, which requires companies to retrospectively expense certain implied costs of the option value related to convertible debt.  As a result, net income, FFO and FFO available to Common Shares and Units – basic and diluted have all been reduced by approximately $5.0 million for both the six months ended June 30, 2009 and 2008, and by approximately $2.1 million and $2.5 million for the quarters ended June 30, 2009 and 2008, respectively.

Equity Residential
Consolidated Balance Sheets
(Amounts in thousands except for share amounts)
(Unaudited)
					June 30,						December 31,
					2009						2008
ASSETS
Investment in real estate
	Land				$	3,669,394					$	3,671,299
	Depreciable property					13,993,241						13,908,594
	Projects under development					725,598						855,473
	Land held for development					239,377						254,873
Investment in real estate						18,627,610						18,690,239
	Accumulated depreciation					(3,759,948	)					(3,561,300	)
Investment in real estate, net						14,867,662						15,128,939
Cash and cash equivalents						667,495						890,794
Investments in unconsolidated entities						3,666						5,795
Deposits – restricted						158,181						152,372
Escrow deposits – mortgage						17,541						19,729
Deferred financing costs, net						54,283						53,817
Other assets						154,234						283,664
			Total assets		$	15,923,062					$	16,535,110
LIABILITIES AND EQUITY
Liabilities:
	Mortgage notes payable				$	5,028,736					$	5,036,930
	Notes, net					4,945,244						5,447,012
	Lines of credit					-						-
	Accounts payable and accrued expenses					113,915						108,463
	Accrued interest payable					107,566						113,846
	Other liabilities					258,677						289,562
	Security deposits					62,035						64,355
	Distributions payable					142,187						141,843
			Total liabilities			10,658,360						11,202,011
Commitments and contingencies
Redeemable Noncontrolling Interests – Operating Partnership						185,923						264,394
Equity:
	Shareholders' equity:
		Preferred Shares of beneficial interest, $0.01 par value;
			100,000,000 shares authorized; 1,950,925 shares issued
			and outstanding as of June 30, 2009 and 1,951,475
			shares issued and outstanding as of December 31, 2008			208,773						208,786
		Common Shares of beneficial interest, $0.01 par value;
			1,000,000,000 shares authorized; 273,975,692 shares issued
			and outstanding as of June 30, 2009 and 272,786,760
			shares issued and outstanding as of December 31, 2008			2,740						2,728
		Paid in capital				4,373,983						4,273,489
		Retained earnings				365,705						456,152
		Accumulated other comprehensive loss				(22,222	)					(35,799	)
			Total shareholders' equity			4,928,979						4,905,356
	Noncontrolling Interests:
		Operating Partnership				136,251						137,645
		Preference Interests and Units				184						184
		Partially Owned Properties				13,365						25,520
			Total Noncontrolling Interests			149,800						163,349
			Total equity			5,078,779						5,068,705
			Total liabilities and equity		$	15,923,062					$	16,535,110

Equity Residential
Portfolio Summary
As of June 30, 2009
											% of 2009			Average
								% of			Stabilized			Rental
		Markets		Properties		Units		Total Units			NOI			Rate (1)
1		New York Metro Area		22		6,246		4.3	%		10.1	%		$	2,627
2		DC Northern Virginia		26		8,781		6.1	%		9.0	%			1,631
3		South Florida		39		12,897		9.0	%		8.5	%			1,264
4		Los Angeles		39		7,841		5.5	%		8.2	%			1,729
5		Seattle/Tacoma		47		10,645		7.4	%		7.3	%			1,314
6		Boston		37		6,608		4.6	%		6.7	%			1,980
7		San Francisco Bay Area		34		6,731		4.7	%		6.6	%			1,670
8		Phoenix		42		12,085		8.4	%		5.4	%			880
9		Denver		25		8,606		6.0	%		5.1	%			998
10		San Diego		14		4,491		3.1	%		4.5	%			1,638
11		Orlando		26		8,042		5.6	%		4.3	%			1,008
12		Atlanta		28		8,730		6.1	%		3.9	%			934
13		Inland Empire, CA		15		4,655		3.2	%		3.8	%			1,333
14		Suburban Maryland		23		6,276		4.4	%		3.6	%			1,217
15		Orange County, CA		10		3,307		2.3	%		3.3	%			1,553
16		New England (excluding Boston)		24		3,945		2.7	%		2.1	%			1,110
17		Portland, OR		10		3,417		2.4	%		1.8	%			967
18		Jacksonville		12		3,951		2.7	%		1.7	%			871
19		Raleigh/Durham		12		3,058		2.1	%		1.3	%			789
20		Tampa		10		3,158		2.2	%		1.2	%			903
		Top 20 Total		495		133,470		92.8	%		98.4	%			1,328
21		Central Valley, CA		7		1,205		0.8	%		0.6	%			1,032
22		Dallas/Ft. Worth		7		1,641		1.1	%		0.5	%			860
23		Other EQR		13		2,939		2.1	%		0.5	%			866
		Total		522		139,255		96.8	%		100.0	%			1,311
		Condominium Conversion		2		42		-			-				-
		Military Housing		2		4,559		3.2	%		-				-
		Grand Total		526		143,856		100.0	%		100.0	%		$	1,311

(1)

Average rental rate is defined as total rental revenues divided by the weighted average occupied units for the month of June 2009.

Equity Residential
Portfolio as of June 30, 2009
										Properties			Units
				Wholly Owned Properties						459				124,627
				Partially Owned Properties:
					Consolidated					25				5,110
					Unconsolidated					40				9,560
				Military Housing (Fee Managed)						2				4,559
										526				143,856
Portfolio Rollforward Q2 2009
($ in thousands)
													Purchase/
							Properties			Units			(Sale) Price				Cap Rate
					3/31/2009		537			146,232
Acquisitions:
		Rental Properties					-			-				-			-
Dispositions:
		Rental Properties:
			Consolidated				(12	)		(2,668	)		$	(213,817	)		7.6	%
		Condominium Conversion Properties					-			(22	)		$	(4,523	)
Completed Developments							1			457
Configuration Changes							-			(143	)
					6/30/2009		526			143,856
Portfolio Rollforward 2009
($ in thousands)
													Purchase/
							Properties			Units			(Sale) Price				Cap Rate
					12/31/2008		548			147,244
Acquisitions:
		Rental Properties					-			-				-			-
Dispositions:
		Rental Properties:
			Consolidated				(23	)		(4,199	)		$	(353,390	)		7.4	%
			Unconsolidated (1)				(1	)		(216	)		$	(20,700	)		8.0	%
		Condominium Conversion Properties					(1	)		(23	)		$	(4,669	)
Completed Developments							3			1,199
Configuration Changes							-			(149	)
					6/30/2009		526			143,856

(1)

EQR owned a 25% interest in this unconsolidated rental property. Sale price listed is the gross sale price.

Equity Residential
Second Quarter 2009 vs. Second Quarter 2008
Quarter over Quarter Same Store Results/Statistics
$ in thousands (except for Average Rental Rate) - 121,256 Same Store Units
				Results														Statistics
																		Average
																		Rental
Description				Revenues				Expenses				NOI (1)						Rate (2)				Occupancy			Turnover
Q2 2009				$	457,052			$	167,886			$	289,166					$	1,343			93.7	%		15.0	%
Q2 2008				$	468,282			$	168,890			$	299,392					$	1,359			94.9	%		15.9	%
Change				$	(11,230	)		$	(1,004	)		$	(10,226	)				$	(16	)		(1.2	%)		(0.9	%)
Change					(2.4	%)			(0.6	%)			(3.4	%)					(1.2	%)
Second Quarter 2009 vs. First Quarter 2009
Sequential Quarter over Quarter Same Store Results/Statistics
$ in thousands (except for Average Rental Rate) - 125,012 Same Store Units
				Results														Statistics
																		Average
																		Rental
Description				Revenues				Expenses				NOI (1)						Rate (2)				Occupancy			Turnover
Q2 2009				$	473,860			$	175,183			$	298,677					$	1,350			93.7	%		15.0	%
Q1 2009				$	475,924			$	182,910			$	293,014					$	1,356			93.7	%		13.5	%
Change				$	(2,064	)		$	(7,727	)		$	5,663					$	(6	)		0.0	%		1.5	%
Change					(0.4	%)			(4.2	%)			1.9	%					(0.4	%)
June YTD 2009 vs. June YTD 2008
YTD over YTD Same Store Results/Statistics
$ in thousands (except for Average Rental Rate) - 120,452 Same Store Units
				Results														Statistics
																		Average
																		Rental
Description				Revenues				Expenses				NOI (1)						Rate (2)				Occupancy			Turnover
YTD 2009				$	910,279			$	341,960			$	568,319					$	1,346			93.7	%		28.5	%
YTD 2008				$	922,549			$	338,147			$	584,402					$	1,352			94.5	%		29.7	%
Change				$	(12,270	)		$	3,813			$	(16,083	)				$	(6	)		(0.8	%)		(1.2	%)
Change					(1.3	%)			1.1	%			(2.8	%)					(0.4	%)

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

Equity Residential
Second Quarter 2009 vs. Second Quarter 2008
Same Store Results by Market
																Increase (Decrease) from Prior Year's Quarter
							Q2 2009			Q2 2009			Q2 2009
							% of			Average			Weighted												Average
							Actual			Rental			Average												Rental
		Markets			Units		NOI			Rate (1)			Occupancy %			Revenues			Expenses			NOI			Rate (1)			Occupancy
1		New York Metro Area			6,246		10.3	%		$	2,680		94.8	%		(3.3	%)		5.6	%		(7.8	%)		(3.0	%)		(0.2	%)
2		DC Northern Virginia			8,057		8.9	%			1,664		94.2	%		(1.4	%)		1.5	%		(2.7	%)		0.3	%		(1.7	%)
3		South Florida			11,761		8.6	%			1,281		93.4	%		(2.8	%)		(2.3	%)		(3.1	%)		(2.1	%)		(0.6	%)
4		Los Angeles			6,863		7.7	%			1,719		92.9	%		(4.1	%)		(1.9	%)		(5.1	%)		(2.0	%)		(2.0	%)
5		Seattle/Tacoma			8,215		6.9	%			1,374		92.8	%		(3.4	%)		0.0	%		(5.3	%)		(1.2	%)		(2.2	%)
6		Boston			5,714		6.9	%			1,924		95.0	%		0.6	%		(3.7	%)		3.2	%		1.8	%		(1.2	%)
7		San Francisco Bay Area			6,200		6.6	%			1,692		93.2	%		(1.2	%)		(2.1	%)		(0.7	%)		1.7	%		(2.7	%)
8		Phoenix			10,646		5.5	%			876		92.7	%		(6.9	%)		(3.3	%)		(9.2	%)		(5.7	%)		(1.3	%)
9		Denver			8,059		5.2	%			997		94.0	%		(0.7	%)		(3.4	%)		0.6	%		0.5	%		(1.2	%)
10		San Diego			4,491		4.9	%			1,646		93.8	%		0.5	%		(1.5	%)		1.4	%		0.9	%		(0.5	%)
11		Orlando			7,525		4.3	%			998		92.9	%		(4.5	%)		0.4	%		(7.5	%)		(3.6	%)		(0.9	%)
12		Atlanta			7,546		4.1	%			974		94.0	%		(3.0	%)		0.8	%		(5.7	%)		(1.7	%)		(1.2	%)
13		Inland Empire, CA			4,355		3.8	%			1,339		94.2	%		(2.3	%)		(2.7	%)		(2.1	%)		(1.4	%)		(0.9	%)
14		Orange County, CA			3,175		3.4	%			1,578		93.9	%		(2.3	%)		(4.0	%)		(1.6	%)		(1.7	%)		(0.6	%)
15		Suburban Maryland			3,977		2.9	%			1,176		94.4	%		1.5	%		1.5	%		1.5	%		2.4	%		(0.8	%)
16		New England (excluding Boston)			3,945		2.3	%			1,104		93.9	%		(1.1	%)		1.2	%		(3.0	%)		0.0	%		(1.1	%)
17		Jacksonville			3,711		1.9	%			890		93.4	%		(2.8	%)		1.5	%		(5.7	%)		(2.6	%)		(0.2	%)
18		Portland, OR			3,113		1.8	%			989		93.7	%		(0.8	%)		1.5	%		(2.2	%)		1.0	%		(1.7	%)
19		Tampa			2,598		1.3	%			941		93.9	%		(3.5	%)		0.9	%		(6.6	%)		(3.1	%)		(0.3	%)
20		Raleigh/Durham			2,666		1.3	%			821		93.9	%		(2.1	%)		(3.8	%)		(0.9	%)		(0.5	%)		(1.5	%)
		Top 20 Markets			118,863		98.6	%			1,350		93.7	%		(2.4	%)		(0.5	%)		(3.4	%)		(1.1	%)		(1.2	%)
		All Other Markets			2,393		1.4	%			1,002		94.2	%		(3.4	%)		(4.5	%)		(2.6	%)		(2.1	%)		(1.3	%)
		Total			121,256		100.0	%		$	1,343		93.7	%		(2.4	%)		(0.6	%)		(3.4	%)		(1.2	%)		(1.2	%)

(1)

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

Equity Residential
Second Quarter 2009 vs. First Quarter 2009
Sequential Same Store Results by Market
																Increase (Decrease) from Prior Quarter
							Q2 2009			Q2 2009			Q2 2009
							% of			Average			Weighted												Average
							Actual			Rental			Average												Rental
		Markets			Units		NOI			Rate (1)			Occupancy %			Revenues			Expenses			NOI			Rate (1)			Occupancy
1		New York Metro Area			6,246		9.9	%		$	2,680		94.8	%		(0.4	%)		(2.6	%)		0.9	%		(1.5	%)		1.0	%
2		DC Northern Virginia			8,781		9.2	%			1,642		94.3	%		(0.1	%)		(5.0	%)		2.4	%		0.2	%		(0.3	%)
3		South Florida			12,465		8.8	%			1,282		93.4	%		(0.3	%)		(5.3	%)		3.5	%		(0.5	%)		0.2	%
4		Los Angeles			7,442		8.0	%			1,735		92.9	%		(2.3	%)		(2.3	%)		(2.3	%)		(1.4	%)		(0.8	%)
5		Boston			6,024		7.2	%			2,001		95.0	%		1.9	%		(10.1	%)		10.7	%		0.9	%		0.9	%
6		Seattle/Tacoma			8,215		6.7	%			1,374		92.8	%		(0.2	%)		(3.0	%)		1.4	%		0.0	%		(0.2	%)
7		San Francisco Bay Area			6,200		6.4	%			1,692		93.2	%		(1.7	%)		(2.1	%)		(1.4	%)		(1.4	%)		(0.3	%)
8		Phoenix			10,646		5.3	%			876		92.7	%		(2.7	%)		(5.0	%)		(1.2	%)		(1.5	%)		(1.2	%)
9		Denver			8,059		5.1	%			997		94.0	%		(0.4	%)		0.8	%		(1.0	%)		(0.9	%)		0.4	%
10		San Diego			4,491		4.7	%			1,646		93.8	%		0.3	%		(5.5	%)		3.3	%		(0.2	%)		0.5	%
11		Orlando			7,690		4.3	%			1,002		92.8	%		(0.5	%)		(1.9	%)		0.6	%		(0.6	%)		0.1	%
12		Atlanta			7,546		3.9	%			974		94.0	%		(0.6	%)		(2.9	%)		1.2	%		(1.1	%)		0.4	%
13		Suburban Maryland			5,251		3.8	%			1,210		94.5	%		3.4	%		(3.7	%)		8.1	%		1.8	%		1.5	%
14		Inland Empire, CA			4,355		3.7	%			1,339		94.2	%		(1.1	%)		(5.2	%)		1.1	%		(0.8	%)		(0.3	%)
15		Orange County, CA			3,175		3.3	%			1,578		93.9	%		(1.3	%)		(3.0	%)		(0.5	%)		(1.1	%)		(0.2	%)
16		New England (excluding Boston)			3,945		2.2	%			1,104		93.9	%		1.2	%		(11.8	%)		16.0	%		1.3	%		(0.1	%)
17		Jacksonville			3,711		1.8	%			890		93.4	%		0.8	%		(1.8	%)		2.9	%		0.6	%		0.2	%
18		Portland, OR			3,113		1.8	%			989		93.7	%		(0.8	%)		(1.4	%)		(0.5	%)		0.1	%		(0.9	%)
19		Tampa			2,598		1.3	%			941		93.9	%		(1.5	%)		(4.8	%)		1.2	%		(1.0	%)		(0.4	%)
20		Raleigh/Durham			2,666		1.2	%			821		93.9	%		(2.0	%)		(2.6	%)		(1.6	%)		(0.7	%)		(1.3	%)
		Top 20 Markets			122,619		98.6	%			1,357		93.7	%		(0.4	%)		(4.2	%)		1.9	%		(0.4	%)		0.0	%
		All Other Markets			2,393		1.4	%			1,002		94.2	%		(0.7	%)		(4.5	%)		1.8	%		(1.4	%)		0.7	%
		Total			125,012		100.0	%		$	1,350		93.7	%		(0.4	%)		(4.2	%)		1.9	%		(0.4	%)		0.0	%

(1)

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

Equity Residential
June YTD 2009 vs. June YTD 2008
Same Store Results by Market
																	Increase (Decrease) from Prior Year
								June YTD 09			June YTD 09			June YTD 09
								% of			Average			Weighted												Average
								Actual			Rental			Average												Rental
			Markets			Units		NOI			Rate (1)			Occupancy %			Revenues			Expenses			NOI			Rate (1)			Occupancy
1			New York Metro Area			6,246		10.4	%		$	2,700		94.3	%		(1.4	%)		3.7	%		(4.3	%)		(1.6	%)		0.2	%
2			South Florida			11,761		8.6	%			1,284		93.4	%		(2.1	%)		1.3	%		(4.5	%)		(1.7	%)		(0.4	%)
3			DC Northern Virginia			7,661		8.5	%			1,655		94.4	%		(0.3	%)		2.1	%		(1.4	%)		0.8	%		(1.1	%)
4			Los Angeles			6,863		7.8	%			1,732		93.3	%		(2.1	%)		0.6	%		(3.3	%)		(1.1	%)		(0.9	%)
5			Seattle/Tacoma			8,215		7.0	%			1,374		92.9	%		(1.4	%)		2.1	%		(3.3	%)		0.3	%		(1.6	%)
6			San Francisco Bay Area			6,200		6.8	%			1,704		93.3	%		0.6	%		0.2	%		0.8	%		3.2	%		(2.4	%)
7			Boston			5,714		6.7	%			1,918		94.7	%		1.1	%		(0.3	%)		1.9	%		2.3	%		(1.2	%)
8			Phoenix			10,238		5.3	%			879		93.3	%		(6.7	%)		0.4	%		(10.9	%)		(5.4	%)		(1.4	%)
9			Denver			8,059		5.3	%			1,002		93.8	%		0.2	%		(1.5	%)		1.1	%		1.6	%		(1.3	%)
10			San Diego			4,491		4.9	%			1,648		93.6	%		0.8	%		0.1	%		1.1	%		1.4	%		(0.5	%)
11			Orlando			7,525		4.4	%			1,001		92.8	%		(4.5	%)		(0.5	%)		(7.0	%)		(3.6	%)		(0.8	%)
12			Atlanta			7,546		4.1	%			979		93.8	%		(1.7	%)		2.3	%		(4.6	%)		(0.7	%)		(1.0	%)
13			Inland Empire, CA			4,355		3.9	%			1,344		94.3	%		(1.2	%)		(0.1	%)		(1.8	%)		(1.6	%)		0.4	%
14			Orange County, CA			3,175		3.5	%			1,587		94.0	%		(1.1	%)		(1.3	%)		(1.1	%)		(0.8	%)		(0.3	%)
15			Suburban Maryland			3,977		2.8	%			1,165		94.1	%		2.2	%		2.7	%		2.0	%		2.5	%		(0.2	%)
16			New England (excluding Boston)			3,945		2.1	%			1,097		94.0	%		(1.0	%)		3.8	%		(5.3	%)		(0.5	%)		(0.5	%)
17			Portland, OR			3,113		1.9	%			989		94.2	%		0.3	%		1.4	%		(0.3	%)		1.4	%		(1.0	%)
18			Jacksonville			3,711		1.9	%			888		93.3	%		(3.8	%)		1.9	%		(7.7	%)		(3.6	%)		(0.2	%)
19			Tampa			2,598		1.3	%			946		94.2	%		(2.9	%)		1.8	%		(6.4	%)		(3.0	%)		0.0	%
20			Raleigh/Durham			2,666		1.3	%			824		94.6	%		(1.1	%)		(0.7	%)		(1.5	%)		(0.2	%)		(0.9	%)
			Top 20 Markets			118,059		98.5	%			1,353		93.7	%		(1.3	%)		1.2	%		(2.8	%)		(0.4	%)		(0.9	%)
			All Other Markets			2,393		1.5	%			1,010		93.8	%		(0.6	%)		(1.9	%)		0.2	%		(0.4	%)		(0.2	%)
			Total			120,452		100.0	%		$	1,346		93.7	%		(1.3	%)		1.1	%		(2.8	%)		(0.4	%)		(0.8	%)

(1)

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

Equity Residential
Debt Summary as of June 30, 2009
(Amounts in thousands)
																Weighted
													Weighted			Average
													Average			Maturities
							Amounts (1)			% of Total			Rates (1)			(years)
Secured							$	5,028,736		50.4	%		4.86	%		9.0
Unsecured								4,945,244		49.6	%		5.34	%		5.2
		Total					$	9,973,980		100.0	%		5.11	%		7.1
Fixed Rate Debt:
	Secured - Conventional						$	4,033,465		40.4	%		5.96	%		7.7
	Unsecured - Public/Private							4,409,644		44.2	%		5.92	%		5.5
		Fixed Rate Debt						8,443,109		84.6	%		5.93	%		6.6
Floating Rate Debt:
	Secured - Conventional							359,597		3.6	%		2.07	%		3.5
	Secured - Tax Exempt							635,674		6.4	%		0.73	%		21.1
	Unsecured - Public/Private							500,000		5.0	%		1.36	%		1.3
	Unsecured - Tax Exempt							35,600		0.4	%		0.44	%		19.5
	Unsecured - Revolving Credit Facility							-		-			-			2.7
		Floating Rate Debt						1,530,871		15.4	%		1.32	%		10.1
Total							$	9,973,980		100.0	%		5.11	%		7.1

(1)		Net of the effect of any derivative instruments. Weighted average rates are for the six months ended June 30, 2009.
		Note: The Company capitalized interest of approximately $21.0 million and $29.5 million during the six months ended June 30, 2009 and 2008, respectively. The Company capitalized interest of approximately $10.4 million and $14.8 million during the quarters ended June 30, 2009 and 2008, respectively.

Debt Maturity Schedule as of June 30, 2009
(Amounts in thousands)
																Weighted			Weighted
																Average Rates			Average
				Fixed			Floating									on Fixed			Rates on
Year				Rate (1)			Rate (1)			Total			% of Total			Rate Debt (1)			Total Debt (1)
2009				$	6,455		$	86,725		$	93,180		0.9	%		7.58	%		2.64	%
2010					220,603			672,235	(2)		892,838		8.9	%		7.54	%		2.93	%
2011					1,258,011	(3)		87,812			1,345,823		13.5	%		5.58	%		5.33	%
2012					955,972			3,442			959,414		9.6	%		5.89	%		5.88	%
2013					565,881			-			565,881		5.7	%		5.93	%		5.93	%
2014					516,964			-			516,964		5.2	%		5.28	%		5.28	%
2015					355,107			-			355,107		3.6	%		6.41	%		6.41	%
2016					1,088,710			-			1,088,710		10.9	%		5.32	%		5.32	%
2017					1,345,998			456			1,346,454		13.5	%		5.87	%		5.87	%
2018					335,501			44,677			380,178		3.8	%		5.96	%		5.60	%
2019		+			1,793,907			635,524			2,429,431		24.4	%		5.86	%		5.04	%
Total				$	8,443,109		$	1,530,871		$	9,973,980		100.0	%		5.80	%		5.22	%

(1)		Net of the effect of any derivative instruments. Weighted average rates are as of June 30, 2009.
(2)		Includes the Company's $500.0 million floating rate term loan facility, which matures on October 5, 2010, subject to two one-year extension options exercisable by the Company.
(3)		Includes $531.1 million face value of 3.85% convertible unsecured debt with a final maturity of 2026. The notes are callable by the Company on or after August 18, 2011. The notes are putable by the holders on August 18, 2011, August 15, 2016 and August 15, 2021.

Equity Residential
Unsecured Debt Summary as of June 30, 2009
(Amounts in thousands)
													Unamortized
			Coupon			Due				Face			Premium/				Net
			Rate			Date				Amount			(Discount)				Balance
	Fixed Rate Notes:
			6.950	%		03/02/11		(1)		$	114,806		$	1,688			$	116,494
			6.625	%		03/15/12					400,000			(795	)			399,205
			5.500	%		10/01/12					350,000			(1,122	)			348,878
			5.200	%		04/01/13					400,000			(444	)			399,556
			5.250	%		09/15/14					500,000			(320	)			499,680
			6.584	%		04/13/15					300,000			(645	)			299,355
			5.125	%		03/15/16					500,000			(359	)			499,641
			5.375	%		08/01/16					400,000			(1,314	)			398,686
			5.750	%		06/15/17					650,000			(4,069	)			645,931
			7.125	%		10/15/17					150,000			(538	)			149,462
			7.570	%		08/15/26					140,000			-				140,000
			3.850	%		08/15/26		(2)			531,092			(18,336	)			512,756
											4,435,898			(26,254	)			4,409,644
	Floating Rate Tax Exempt Notes:
			7-Day SIFMA			12/15/28		(3)			35,600			-				35,600
	Floating Rate Notes:
	Term Loan Facility		LIBOR+0.50%			10/05/10		(3)(4)			500,000			-				500,000
	Revolving Credit Facility:		LIBOR+0.50%			02/28/12		(5)			-			-				-
	Total Unsecured Debt									$	4,971,498		$	(26,254	)		$	4,945,244

		Note: SIFMA stands for the Securities Industry and Financial Markets Association and is the tax-exempt index equivalent of LIBOR.
(1)		On January 27, 2009, the Company repurchased $185.2 million of these notes at par pursuant to a cash tender offer announced on January 16, 2009.
(2)		Convertible notes mature on August 15, 2026. The notes are callable by the Company on or after August 18, 2011. The notes are putable by the holders on August 18, 2011, August 15, 2016 and August 15, 2021. During the six months ended June 30, 2009, the Company repurchased $17.5 million of these notes at a discount to par of approximately 11.6% and recognized a gain on early debt extinguishment of $2.0 million. Effective January 1, 2009, the Company adopted FSP APB 14-1, which requires companies to expense the implied option value inherent in convertible debt. In conjunction with this adoption, the Company recorded an adjustment of $17.3 million to the beginning balance of the discount on its convertible notes.
(3)		Notes are private. All other unsecured debt is public.
(4)		Represents the Company's $500.0 million term loan facility, which matures on October 5, 2010, subject to two one-year extension options exercisable by the Company.
(5)		As of June 30, 2009, there was no amount outstanding and approximately $1.35 billion available on the Company's unsecured revolving credit facility.

Equity Residential
Selected Unsecured Public Debt Covenants
							June 30,			March 31,
							2009			2009
Total Debt to Adjusted Total Assets (not to exceed 60%)							50.8	%		51.2	%
Secured Debt to Adjusted Total Assets (not to exceed 40%)							25.6	%		25.1	%
Consolidated Income Available for Debt Service to
	Maximum Annual Service Charges
	(must be at least 1.5 to 1)						2.30			2.34
Total Unsecured Assets to Unsecured Debt
	(must be at least 150%)						238.2	%		231.1	%

These selected covenants relate to ERP Operating Limited Partnership's ("ERPOP") outstanding unsecured public debt. Equity Residential is the general partner of ERPOP.

Equity Residential
Capital Structure as of June 30, 2009
(Amounts in thousands except for share/unit and per share amounts)
			Secured Debt													$	5,028,736		50.4	%
			Unsecured Debt														4,945,244		49.6	%
		Total Debt															9,973,980		100.0	%		60.0	%
			Common Shares (includes Restricted Shares)							273,975,692			94.4	%
			Units							16,205,905			5.6	%
		Total Shares and Units								290,181,597			100.0	%
		Common Share Equivalents (see below)								405,555
		Total outstanding at quarter-end								290,587,152
		Common Share Price at June 30, 2009							$	22.23
																	6,459,752		97.0	%
		Perpetual Preferred Equity (see below)															200,000		3.0	%
		Total Equity															6,659,752		100.0	%		40.0	%
		Total Market Capitalization														$	16,633,732					100.0	%
Convertible Preferred Equity as of June 30, 2009
(Amounts in thousands except for share/unit and per share/unit amounts)
												Annual				Annual			Weighted						Common
					Redemption		Outstanding		Liquidation			Dividend				Dividend			Average			Conversion			Share
Series					Date		Shares/Units		Value			Per Share/Unit				Amount			Rate			Ratio			Equivalents
Preferred Shares:
	7.00% Series E				11/1/98		328,466		$	8,212		$	1.75			$	575					1.1128			365,517
	7.00% Series H				6/30/98		22,459			561			1.75				39					1.4480			32,521
Junior Preference Units:
	8.00% Series B				7/29/09		7,367			184			2.00				15					1.020408			7,517
Total Convertible Preferred Equity							358,292		$	8,957						$	629		7.02	%					405,555
Perpetual Preferred Equity as of June 30, 2009
(Amounts in thousands except for share and per share amounts)
												Annual				Annual			Weighted
					Redemption		Outstanding		Liquidation			Dividend				Dividend			Average
Series					Date		Shares		Value			Per Share				Amount			Rate
Preferred Shares:
	8.29% Series K				12/10/26		1,000,000		$	50,000		$	4.145			$	4,145
	6.48% Series N				6/19/08		600,000			150,000			16.20				9,720
Total Perpetual Preferred Equity							1,600,000		$	200,000						$	13,865		6.93	%

Equity Residential
Common Share and Unit
Weighted Average Amounts Outstanding
									YTD Q209		YTD Q208		Q209		Q208
Weighted Average Amounts Outstanding for Net Income Purposes:
	Common Shares - basic								272,613,907		269,196,050		272,901,078		269,607,843
	Shares issuable from assumed conversion/vesting of:
			- OP Units						16,237,055		18,063,520		16,089,264		17,832,334
			- long-term compensation award shares/units						300,939		2,661,461		347,395		3,004,340
	Total Common Shares and Units - diluted								289,151,901		289,921,031		289,337,737		290,444,517
Weighted Average Amounts Outstanding for FFO Purposes:
	Common Shares - basic								272,613,907		269,196,050		272,901,078		269,607,843
	OP Units - basic								16,237,055		18,063,520		16,089,264		17,832,334
	Total Common Shares and OP Units - basic								288,850,962		287,259,570		288,990,342		287,440,177
	Shares issuable from assumed conversion/vesting of:
			- convertible preferred shares/units						405,791		438,825		405,555		433,179
			- long-term compensation award shares/units						300,939		2,661,461		347,395		3,004,340
	Total Common Shares and Units - diluted								289,557,692		290,359,856		289,743,292		290,877,696
Period Ending Amounts Outstanding:
	Common Shares (includes Restricted Shares)								273,975,692
	Units								16,205,905
	Total Shares and Units								290,181,597

Equity Residential
Partially Owned Entities as of June 30, 2009
(Amounts in thousands except for project and unit amounts)
				Consolidated																				Unconsolidated
				Development Projects
				Held for																				Institutional
				and/or Under				Completed, Not				Completed												Joint
				Development				Stabilized (4)				and Stabilized				Other				Total				Ventures
Total projects			(1)		-				2				2				21				25				40
Total units			(1)		-				735				432				3,943				5,110				9,560
Operating information for the six months
	ended 6/30/09 (at 100%):
	Operating revenue			$	309			$	2,891			$	3,564			$	28,639			$	35,403			$	48,107
	Operating expenses				635				2,171				1,473				9,670				13,949				21,716
	Net operating (loss) income				(326	)			720				2,091				18,969				21,454				26,391
	Depreciation				185				1,179				1,780				7,445				10,589				10,105
	General and administrative/other				50				411				5				7				473				190
	Operating (loss) income				(561	)			(870	)			306				11,517				10,392				16,096
	Interest and other income				19				-				-				71				90				98
	Other expenses				2				-				-				-				2				-
	Interest:
		Expense incurred, net			(51	)			(1,887	)			(1,074	)			(10,070	)			(13,082	)			(25,865	)
		Amortization of deferred financing costs			(40	)			(76	)			(26	)			(83	)			(225	)			(427	)
	Income and other tax (expense) benefit				(19	)			-				-				(34	)			(53	)			(132	)
	Net (loss) income			$	(650	)		$	(2,833	)		$	(794	)		$	1,401			$	(2,876	)		$	(10,230	)
Debt - Secured (2):
		EQR Ownership (3)		$	332,765			$	161,981			$	61,260			$	218,087			$	774,093			$	109,958
		Noncontrolling Ownership			-				-				-				83,957				83,957				329,874
Total (at 100%)				$	332,765			$	161,981			$	61,260			$	302,044			$	858,050			$	439,832

(1)		Project and unit counts exclude all uncompleted development projects until those projects are substantially completed. See the Consolidated Development Projects schedule for more detail.
(2)		All debt is non-recourse to the Company with the exception of $42.2 million in mortgage debt on various development projects. In addition, $66.0 million in mortgage debt on one development project will become recourse to the Company upon completion of that project.
(3)		Represents the Company's current economic ownership interest.
(4)		Projects included here are substantially complete. However, they may still require additional exterior and interior work for all units to be available for leasing.

Equity Residential
Consolidated Development Projects as of June 30, 2009
(Amounts in thousands except for project and unit amounts)
											Total Book Value Not Placed in
							Total Capital		Total Book Value																Estimated Completion		Estimated Stabilization
					No. of								Total			Percentage			Percentage			Percentage
Projects			Location		Units		Cost (1)		to Date		Service		Debt			Completed			Leased			Occupied			Date		Date
Projects Under Development - Wholly Owned:
70 Greene (a.k.a. 77 Hudson)			Jersey City, NJ		480		$ 269,958		$ 244,591		$ 244,591		$ -			93	%		26	%		15	%		Q4 2009		Q1 2011
Reserve at Town Center II			Mill Creek, WA		100		24,464		15,090		15,090		-			64	%		-			-			Q1 2010		Q3 2010
Redmond Way			Redmond, WA		250		84,382		37,097		37,097		-			35	%		-			-			Q1 2011		Q1 2012
Projects Under Development - Wholly Owned					830		378,804		296,778		296,778		-
Projects Under Development - Partially Owned:
Montclair Metro			Montclair, NJ		163		48,730		40,471		40,471		23,070			89	%		-			-			Q3 2009		Q1 2010
Red Road Commons			South Miami, FL		404		128,816		119,329		119,329		63,662			96	%		54	%		12	%		Q1 2010		Q3 2011
111 Lawrence Street			Brooklyn, NY		492		283,968		169,202		169,202		48,272			66	%		-			-			Q2 2010		Q3 2011
Westgate			Pasadena, CA		480		170,558		99,818		99,818		163,160	(2	)	48	%		-			-			Q2 2011		Q2 2012
Projects Under Development - Partially Owned					1,539		632,072		428,820		428,820		298,164
Projects Under Development					2,369		1,010,876		725,598		725,598		298,164	(3	)
Land Held for Development					N/A		-		239,377		239,377		34,601
Land/Projects Held for and/or Under Development					2,369		1,010,876		964,975		964,975		332,765
Completed Not Stabilized - Wholly Owned (4):
Crowntree Lakes			Orlando, FL		352		56,628		56,628		-		-						98	%		93	%		Completed		Q3 2009
Mosaic at Metro			Hyattsville, MD		260		60,383		59,560		-		41,499						70	%		60	%		Completed		Q1 2010
Third Square (a.k.a. 303 Third Street) (5)			Cambridge, MA		482		255,625		254,587		-		172,235						67	%		55	%		Completed		Q2 2010
Reunion at Redmond Ridge			Redmond, WA		321		53,175		53,150		-		-						38	%		36	%		Completed		Q3 2010
Projects Completed Not Stabilized - Wholly Owned					1,415		425,811		423,925		-		213,734
Completed Not Stabilized - Partially Owned (4):
1401 South State (a.k.a. City Lofts)			Chicago, IL		278		69,952		68,438		-		52,124						87	%		74	%		Completed		Q4 2009
Veridian (a.k.a. Silver Spring)			Silver Spring, MD		457		148,705		147,748		-		109,857						76	%		54	%		Completed		Q3 2010
Projects Completed Not Stabilized - Partially Owned					735		218,657		216,186		-		161,981
Projects Completed Not Stabilized					2,150		644,468		640,111		-		375,715
Completed and Stabilized During the Quarter - Wholly Owned:
Highland Glen II			Westwood, MA		102		19,888		19,868		-		-						99	%		97	%		Completed		Stabilized
West End Apartments (a.k.a. Emerson/CRP II)			Boston, MA		310		163,489		163,432		-		-						98	%		96	%		Completed		Stabilized
Projects Completed and Stabilized During the Quarter - Wholly Owned					412		183,377		183,300		-		-
Projects Completed and Stabilized During the Quarter					412		183,377		183,300		-		-
Total Projects					4,931		$ 1,838,721		$ 1,788,386		$ 964,975		$ 708,480
NOI CONTRIBUTION FROM DEVELOPMENT PROJECTS																Total Capital Cost (1)			Q2 2009 NOI
Projects Under Development																$ 1,010,876			$ (290	)
Completed Not Stabilized																644,468			1,521
Completed and Stabilized During the Quarter																183,377			1,881
Total Development NOI Contribution																$ 1,838,721			$ 3,112

(1) Total capital cost represents estimated development cost for projects under development and all capitalized costs incurred to date plus any estimates of costs remaining to be funded for all projects, all in accordance with GAAP.
(2) Debt is primarily tax-exempt bonds that are entirely outstanding with $72.4 million held in escrow by the lender and released as draw requests are made. This escrowed amount is classified as "Deposits - restricted" in the consolidated balance sheets at June 30, 2009.
(3) Of the approximately $285.3 million of capital cost remaining to be funded at 6/30/09 for projects under development, $203.3 million will be funded by fully committed third party bank loans and the remaining $82.0 million will be funded by cash on hand.
(4) Properties included here are substantially complete. However, they may still require additional exterior and interior work for all units to be available for leasing.
(5) Third Square - Both the percentage leased and percentage occupied reflect the full 482 units included in phases I & II. Phase I is 94% leased and 83% occupied. Phase II is 26% leased and 11% occupied. The partner's interest was acquired during the second quarter of 2009 for $4.8 million and as a result the project is now wholly owned.

Equity Residential
Maintenance Expenses and Capitalized Improvements to Real Estate
For the Six Months Ended June 30, 2009
(Amounts in thousands except for unit and per unit amounts)
					Maintenance Expenses												Capitalized Improvements to Real Estate													Total Expenditures
																					Building Improvements (5)
			Total Units (1)				Avg. Per Unit				Avg. Per Unit				Avg. Per Unit		Replacements (4)		Avg. Per Unit				Avg. Per Unit				Avg. Per Unit			Grand Total		Avg. Per Unit
					Expense (2)				Payroll (3)				Total												Total
Established Properties (6)			109,382		$ 42,957		$ 393		$ 38,490		$ 352		$ 81,447		$ 745		$ 16,543		$ 151		$ 17,513		$ 160		$ 34,056		$ 311	(9	)	$ 115,503		$ 1,056
New Acquisition Properties (7)			14,348		5,608		398		4,843		344		10,451		742		1,578		112		3,806		271		5,384		383			15,835		1,125
Other (8)			6,007		4,384				3,587				7,971				16,853				2,827				19,680					27,651
Total			129,737		$ 52,949				$ 46,920				$ 99,869				$ 34,974				$ 24,146				$ 59,120					$ 158,989

(1)		Total Units - Excludes 9,560 unconsolidated units and 4,559 military housing (fee managed) units, for which maintenance expenses and capitalized improvements to real estate are self-funded and do not consolidate into the Company's results.
(2)		Maintenance Expenses - Includes 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 - Includes new expenditures inside the units such as appliances, mechanical equipment, fixtures and flooring, including carpeting.
(5)		Building Improvements - Includes roof replacement, paving, amenities and common areas, building mechanical equipment systems, exterior painting and siding, major landscaping, vehicles and office and maintenance equipment.
(6)		Established Properties - Wholly Owned Properties acquired prior to January 1, 2007.
(7)		New Acquisition Properties - Wholly Owned Properties acquired during 2007, 2008 and 2009. Per unit amounts are based on a weighted average of 14,074 units.
(8)		Other - Primarily includes properties either partially owned or sold during the period, commercial space and corporate housing. Also includes $15.4 million included in replacements spent on various assets related to major renovations and repositioning of these assets.
(9)		For 2009, the Company estimates an annual stabilized run rate of approximately $925 per unit of capital expenditures for its established properties.

Equity Residential
Discontinued Operations
(Amounts in thousands)
			Six Months Ended						Quarter Ended
			June 30,						June 30,
			2009			2008			2009			2008
REVENUES
Rental income			$ 17,832			$ 60,482			$ 6,408			$ 27,599
	Total revenues		17,832			60,482			6,408			27,599
EXPENSES (1)
Property and maintenance			8,036			19,312			3,244			8,544
Real estate taxes and insurance			2,284			7,936			767			3,801
Property management			-			(62	)		-			3
Depreciation			3,641			14,921			1,438			6,782
General and administrative			25			17			20			14
Total expenses			13,986			42,124			5,469			19,144
Discontinued operating income			3,846			18,358			939			8,455
Interest and other income			10			140			3			148
Interest (2):
	Expense incurred, net		(310	)		(1,014	)		(77	)		(496	)
	Amortization of deferred financing costs		(32	)		(2	)		-			(1	)
Income and other tax (expense) benefit			(65	)		657			(18	)		459
Discontinued operations			3,449			18,139			847			8,565
Net gain on sales of discontinued operations			145,798			214,797			83,927			92,280
Discontinued operations, net			$ 149,247			$ 232,936			$ 84,774			$ 100,845

(1)		Includes expenses paid in the current period for properties sold or held for sale in prior periods related to the Company’s period of ownership.
(2)		Includes only interest expense specific to secured mortgage notes payable for properties sold and/or held for sale.

Equity Residential
FFO Midpoint Reconciliations and Non-Comparable Items
(Amounts in thousands except per share data)
(All per share data is diluted)
FFO Midpoint Reconciliations
									FFO Reconciliations
									Guidance Midpoint Q2
									2009 to Actual Q2 2009
									Amounts			Per Share
Guidance midpoint Q2 2009 FFO - Diluted (1) (2)									$ 158,912			$ 0.548
Property NOI (including reserve adjustments)									10,780			0.037
Interest and other income									4,014			0.014
Impairment									(11,124	)		(0.038	)
Interest expense									4,003			0.014
Other									2,066			0.007
Actual Q2 2009 FFO - Diluted (1) (2)									$ 168,651			$ 0.582
Non-Comparable Items (3)
			Six Months Ended June 30,									Quarter Ended June 30,
			2009			2008			Variance			2009			2008			Variance
Impairment			$ (11,124	)		$ -			$ (11,124	)		$ (11,124	)		$ -			$ (11,124	)
Debt extinguishment gains (interest and other income)			2,020			-			2,020			-			-			-
Gain on sale of investment securities (interest and other income)			4,943			-			4,943			4,943			-			4,943
FSP APB 14-1 convertible debt discount
(includes extinguishment write-offs)			(5,025	)		(5,036	)		11			(2,141	)		(2,518	)		377
Debt extinguishment costs (interest):
Prepayment penalties			(35	)		-			(35	)		-			-			-
Write-off of unamortized deferred financing costs			(1,435	)		(6	)		(1,429	)		(780	)		-			(780	)
Write-off of unamortized premiums/(discounts)/(OCI)			(758	)		-			(758	)		47			-			47
EQR 25% share of unconsolidated defeasance costs
((loss) from investments in unconsolidated entities)			(1,775	)		-			(1,775	)		(1,775	)		-			(1,775	)
Net incremental gain (loss) on sales of condominium units			335			(3,090	)		3,425			399			(3,456	)		3,855
Other			(1,842	)		(465	)		(1,377	)		(828	)		627			(1,455	)
Net non-comparable items (3)			$ (14,696	)		$ (8,597	)		$ (6,099	)		$ (11,259	)		$ (5,347	)		$ (5,912	)
Note: See page 25 for definitions, footnotes and reconciliations of EPS to FFO.

Equity Residential
Earnings Guidance and Assumptions
The earnings guidance/projections provided below are based on current expectations and are forward-looking.
2009 Earnings Guidance (per share diluted)
				Q3 2009		2009
Expected FFO (1) (2)				$0.49 to $0.53		$2.10 to $2.20
2009 Same Store Assumptions
Physical occupancy						93.5%
Revenue change						(3.50%) to (3.00%)
Expense change						1.25% to 1.75%
NOI change						(6.50%) to (5.50%)
(Note: 25 basis point change in NOI percentage = $0.01 per share change in EPS/FFO)
2009 Transaction Assumptions
Rental acquisitions						$150.0 million
Rental dispositions						$800.0 million
Capitalization rate spread						125 basis points
2009 Debt Assumptions
Weighted average debt outstanding						$9.7 billion to $10.1 billion
Weighted average interest rate (reduced for capitalized interest and including prepayment penalties)						4.90%
Interest expense						$475.0 million to $495.0 million
Unrestricted cash at 12/31/09						$545.0 million
Note: Debt guidance assumes no additional debt offerings and no additional debt extinguishments, but does include approximately $9.3 million of interest expense for the mandatory adoption of FSP APB 14-1, which requires companies to expense the implied option value inherent in convertible debt. This change does not affect the Company's continued compliance with its financial or debt covenants.
2009 Other Guidance Assumptions
General and administrative expense						$40.0 million to $42.0 million
Interest and other income						$13.0 million to $15.0 million
Income and other tax expense						$3.0 million to $4.0 million
Net gain on sales of land parcels						No amounts budgeted
Preferred share redemptions						No amounts budgeted
Weighted average Common Shares and Units - Diluted						289.7 million

Equity Residential
Additional Reconciliations
(Amounts in thousands except per share data)
(All per share data is diluted)
The earnings guidance/projections provided below are based on current expectations and are forward-looking.
Reconciliations of EPS to FFO for Pages 23 and 24
								Expected			Expected
		Expected Q2 2009						Q3 2009			2009
		Amounts			Per Share			Per Share			Per Share
Expected Earnings - Diluted (4)		$ 43,719			$ 0.150			$0.48 to $0.52			$1.22 to $1.32
Add: Expected depreciation expense		148,381			0.513			0.51			2.07
Less: Expected net gain on sales (4)		(33,188	)		(0.115	)		(0.50	)		(1.19	)
Expected FFO - Diluted (1) (2)		$ 158,912			$ 0.548			$0.49 to $0.53			$2.10 to $2.20

Definitions and Footnotes for Pages 23 and 24
(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. FFO available to Common Shares and Units is calculated on a basis consistent with net income available to Common Shares and reflects adjustments to net income for preferred distributions and premiums on redemption of preferred shares in accordance with accounting principles generally accepted in the United States. The equity positions of various individuals and entities that contributed their properties to the Operating Partnership in exchange for OP Units are collectively referred to as the "Noncontrolling  Interests - Operating Partnership". Subject to certain restrictions, the Noncontrolling Interests - Operating Partnership may exchange their OP Units for EQR Common Shares on a one-for-one basis.
(2)		The Company believes that FFO and FFO available to Common Shares and 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 Common Shares and 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 Common Shares and Units do not represent net income, net income available to Common Shares or net cash flows from operating activities in accordance with GAAP.  Therefore, FFO and FFO available to Common Shares and Units should not be exclusively considered as alternatives to net income, net income available to Common Shares or net cash flows from operating activities as determined by GAAP or as a measure of liquidity.  The Company's calculation of FFO and FFO available to Common Shares and 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)		Non-comparable items are those items included in FFO that by their nature are not comparable from period to period, such as net incremental gain on sales of condominium units, impairment charges, debt extinguishment costs and redemption premiums on Preferred Shares/Preference Interests.
(4)		Earnings represents net income per share calculated in accordance with accounting principles generally accepted in the United States. Expected earnings is calculated on a basis consistent with actual earnings. Due to the uncertain timing and extent of property dispositions and the resulting gains/losses on sales, actual earnings could differ materially from expected earnings.

Same Store NOI Reconciliation for Page 10
The following tables present reconciliations of operating income per the consolidated statements of operations to NOI for the June YTD 2009 and Second Quarter 2009 Same Store Properties:
		Six Months Ended June 30,						Quarter Ended June 30,
		2009			2008			2009			2008
Operating income		$ 277,409			$ 295,128			$ 135,962			$ 158,356
Adjustments:
Non-same store operating results		(37,713	)		(13,331	)		(17,600	)		(9,825	)
Fee and asset management revenue		(5,275	)		(5,010	)		(2,412	)		(2,716	)
Fee and asset management expense		3,985			4,171			1,982			1,991
Depreciation		298,194			279,253			149,909			139,812
General and administrative		20,595			24,191			10,201			11,774
Impairment		11,124			-			11,124			-
Same store NOI		$ 568,319			$ 584,402			$ 289,166			$ 299,392