Post Apartment Homes 8K Results of Operations and Financial Condition | SEC 31 Oct 06

Exhibit 99.2

Third Quarter 2006
Supplemental Financial Data

Table of Contents


	Page
Consolidated Statements of Operations		3
Calculation of Funds from Operations and Adjusted Funds From Operations		7
Same Store Results		9
Consolidated Balance Sheets		12
Consolidated Debt Summary		13
Summary of Communities Under Construction		16
Summary of Communities Under Rehabilitation		17
Summary of Condominium Conversion Projects		18
Community Acquisition and Disposition Summary		19
Capitalized Costs Summary		20
Investments in Unconsolidated Real Estate Entities		21
Net Asset Value Supplemental Information		23
Non-GAAP Financial Measures and Other Defined Terms		25

The projections and estimates given in this document and other written or oral statements made by or on behalf of the Company may constitute “forward-looking statements” within the meaning of the federal securities laws. All forward-looking statements are subject to certain risks and uncertainties that could cause actual events to differ materially from those projected. Management believes that these forward-looking statements are reasonable; however, you should not place undue reliance on such statements. These statements are based on current expectations and speak only as of the date of such statements. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of future events, new information or otherwise. The following are some of the factors that could cause the Company’s actual results to differ materially from the expected results described in the Company’s forward-looking statements: the success of the Company’s business strategies discussed in its annual report on Form 10-K dated December 31, 2005, as amended; future local and national economic conditions, including changes in job growth, interest rates, the availability of financing and other factors; demand for apartments in the Company’s markets and the effect on occupancy and rental rates; the impact of competition on the Company’s business, including competition for tenants and development locations for its apartment communities and competing for-sale housing in the markets where the Company is completing condominium conversions or developing new condominiums; the Company’s ability to obtain financing or self-fund the development or acquisition of additional multifamily rental and for-sale housing; the uncertainties associated with the Company’s current and planned future real estate development, including actual costs exceeding the Company’s budgets or development periods exceeding expectations; uncertainties associated with the timing and amount of asset sales and the resulting gains/losses associated with such asset sales; uncertainties associated with the Company’s condominium conversion and for-sale housing business; conditions affecting ownership of residential real estate and general conditions in the multi-family residential real estate market; uncertainties associated with environmental and other regulatory matters, including the Americans with Disabilities Act and the Fair Housing Act; the effects of changes in accounting policies and other regulatory matters detailed in the Company’s filings with the Securities and Exchange Commission and uncertainties of litigation; and the Company’s ability to continue to qualify as a real estate investment trust under the Internal Revenue Code. Other important risk factors regarding the Company are included under the caption “Risk Factors” in the company’s annual report on Form 10-K, as amended, dated December 31, 2005 and may be discussed in subsequent filings with the SEC. The risk factors discussed in Form 10-K, as amended, under the caption “Risk Factors” are specifically incorporated by reference into this document.

Post Properties, Inc.
Consolidated Statements of Operations
(In thousands, except per share or unit data)
(Unaudited)


	Three months ended						Nine months ended
	September 30,						September 30,
	2006			2005			2006			2005
Revenues
Rental	$	72,216		$	67,538		$	210,211		$	196,805
Other property revenues		4,609			4,298			12,934			11,675
Other		49			64			200			196

Total revenues		76,874			71,900			223,345			208,676


Expenses
Property operating and maintenance (exclusive of items shown separately below)		35,790			33,019			102,844			96,832
Depreciation		16,966			17,496			50,101			53,539
General and administrative (1)		4,406			4,558			13,464			13,506
Investment, development and other (2)		1,332			1,333			4,500			3,737

Total expenses		58,494			56,406			170,909			167,614


Operating income		18,380			15,494			52,436			41,062

Interest income		175			229			413			583
Interest expense		(13,609	)		(13,676	)		(40,281	)		(42,722	)
Amortization of deferred financing costs		(882	)		(990	)		(2,651	)		(3,707	)
Gains (losses) on sales of condominiums, net (3)		1,611			(99	)		10,022			(368	)
Equity in income of unconsolidated real estate entities		527			592			1,251			1,294
Other income (4)		1,401			—			3,095			5,267
Minority interest in consolidated property partnerships		(85	)		34			(177	)		212
Minority interest of common unitholders		(87	)		10			(369	)		226

Income from continuing operations		7,431			1,594			23,739			1,847

Discontinued operations(5)
Income from discontinued property operations, net of minority interest		988			662			3,083			5,568
Gains on sales of real estate assets, net of minority interest and provision for income taxes		27,503			72,733			27,885			131,991
Loss on early extinguishment of indebtedness, net of minority interest (6)		(121	)		(1,748	)		(121	)		(3,044	)

Income from discontinued operations		28,370			71,647			30,847			134,515

Net income		35,801			73,241			54,586			136,362
Dividends to preferred shareholders		(1,909	)		(1,909	)		(5,728	)		(5,728	)

Net income available to common shareholders	$	33,892		$	71,332		$	48,858		$	130,634


Per common share data — Basic(7)
Income (loss) from continuing operations (net of preferred dividends)	$	0.13		$	(0.01	)	$	0.42		$	(0.10	)
Income from discontinued operations		0.66			1.77			0.72			3.35

Net income available to common shareholders	$	0.79		$	1.77		$	1.15		$	3.25

Weighted average common shares outstanding — basic		43,137			40,372			42,616			40,157


Per common share data — Diluted(7)
Income (loss) from continuing operations (net of preferred dividends)	$	0.13		$	(0.01	)	$	0.42		$	(0.10	)
Income from discontinued operations		0.65			1.77			0.71			3.35

Net income available to common shareholders	$	0.77		$	1.77		$	1.13		$	3.25

Weighted average common shares outstanding — diluted		43,955			40,372			43,387			40,157

Dividends declared	$	0.45		$	0.45		$	1.35		$	1.35

Post Properties, Inc.
Notes to Consolidated
Statements of Operations
(In thousands, except per share or unit data)


(1)		Beginning in the fourth quarter of 2005, the Company reclassified certain expenses previously reported as general and administrative expenses to property operating and maintenance expenses and investment, development and other expenses on the accompanying statements of operations. Prior period amounts have been reclassified to conform to this presentation. The reclassified expenses primarily included certain investment and development group functions and long-term, stock-based compensation and benefits expenses associated with property management and investment and development group activities.

(2)		Investment, development and other expenses for the three and nine months ended September 30, 2006 and 2005 include investment group expenses, development personnel and associated costs not allocable to current development projects.

(3)		In the three and nine months ended September 30, 2006, income from continuing operations included net gains from condominium sales activities at condominium conversion projects representing portions of existing communities. In addition, condominium gains are net of certain expensed sales and marketing costs associated with new condominium communities under development totaling $109 and $99 for the three months and $398 and $368 for the nine months ended September 30, 2006 and 2005, respectively. Net gains from condominium sales activities at other consolidated community conversion projects are included in discontinued operations under generally accepted accounting principles (see (5) below). A summary of revenues and costs and expenses of condominium activities included in continuing operations for the three and nine months ended September 30, 2006 and 2005 was as follows:


	Three months ended						Nine months ended
	September 30,						September 30,
	2006			2005			2006			2005
Condominium revenues	$	6,778		$	—		$	25,241		$	—
Condominium costs and expenses		(5,167	)		(99	)		(15,219	)		(368	)

Gains (losses) on sales of condominiums, net	$	1,611		$	(99	)	$	10,022		$	(368	)

(4)

In the three months ended September 30, 2006, other income includes a gain on the sale of marketable securities of $573, an additional gain on sale of its prior investment in Rent.com of $325 resulting from the receipt of previously escrowed proceeds under the prior year sale and a $503 gain on the sale of a land parcel. In the first quarter of 2006, one of the Company’s derivative financial instruments, previously accounted for as a cash flow hedge, became ineffective under generally accepted accounting principles. As a result, the net increase in the market value of this derivative prior to its termination in April 2006 totaling $1,655 was recognized in other income. In the nine months ended September 30, 2005, the Company sold its investment in Rent.com, a privately-held internet leasing company, and recognized a gain of $5,267.

(5)		Under SFAS No. 144, the operating results of real estate assets designated as held for sale are included in discontinued operations for all periods presented. Additionally, all subsequent gains or additional losses on the sale of these assets are included in discontinued operations.

		For the three and nine months ended September 30, 2006, income from discontinued operations included the operating results of three apartment communities, containing 826 units classified as held for sale, one condominium conversion community classified as held for sale and the operations of one apartment community, containing 696 units, through its sale date in August 2006. For the three and nine months ended September 30, 2005, income from discontinued operations included the operating results of three apartment communities and one condominium conversion community classified as held for sale at September 30, 2006, the operations of one apartment community sold in 2006, six communities sold in 2005 and one condominium conversion community through its sell-out date in 2005.

The operating revenues and expenses of these communities for the three and nine months ended September 30, 2006 and 2005 were as follows:


	Three months ended						Nine months ended
	September 30,						September 30,
	2006			2005			2006			2005
Revenues
Rental	$	2,806		$	5,086		$	10,355		$	24,129
Other property revenues		324			652			1,128			2,430

Total revenues		3,130			5,738			11,483			26,559

Expenses
Property operating and maintenance (exclusive of items shown separately below)		1,258			2,569			4,304			11,554
Depreciation		286			1,454			1,639			4,359
Interest		582			1,026			2,394			4,741
Minority interest in consolidated property partnerships		—			—			—			14

Total expenses		2,126			5,049			8,337			20,668

Income from discontinued property operations before minority interest		1,004			689			3,146			5,891
Minority interest		(16	)		(27	)		(63	)		(323	)

Income from discontinued property operations	$	988		$	662		$	3,083		$	5,568

		For the three and nine months ended September 30, 2006, the Company recognized net gains in discontinued operations of $28,120 ($27,555 net of minority interest) from the sale of one community, containing 696 units. The sale generated net proceeds of approximately $116,876, including $40,000 of secured indebtedness assumed by the purchaser.

		For the three and nine months ended September 30, 2006 and 2005, gains on sales of real estate assets included in discontinued operations also includes net gains from condominium sales at two condominium conversion communities. A summary of revenues and costs and expenses of condominium activities included in discontinued operations for the three and nine months ended September 30, 2006 and 2005 was as follows:


	Three months ended						Nine months ended
	September 30,						September 30,
	2006			2005			2006			2005
Condominium revenues	$	504		$	11,911		$	7,022		$	50,016
Condominium costs and expenses		(558	)		(9,537	)		(6,685	)		(34,130	)

Gains (losses) on condominium sales, before minority interest and income taxes		(54	)		2,374			337			15,886
Minority interest		2			(88	)		(7	)		(836	)
Provision for income taxes		—			(270	)		—			(653	)

Gains (losses) on condominium sales, net of minority interest and income taxes	$	(52	)	$	2,016		$	330		$	14,397

For the three months ended September 30, 2005, the Company recognized net gains in discontinued operations of $74,715 ($70,717 net of minority interest) from the sale of one community, containing 1,738 units. The sale generated net proceeds of approximately $131,349, including $47,500 of tax-exempt secured indebtedness assumed by the purchaser. For the nine months ended September 30, 2005, the Company recognized net gains in discontinued operations of $124,425 ($117,594 net of minority interest) from the sale of six communities, containing 3,047 units. The sales generated net proceeds of approximately $229,249, including $81,560 of tax-exempt secured indebtedness assumed by the purchasers.

(6)		For the three and nine months ended September 30, 2006, the loss on early extinguishment of indebtedness includes the write-off of unamortized deferred costs of $123 ($121 net of minority interest) relating to secured indebtedness assumed in connection with the sale of one community, containing 696 units.

		For the three months ended September 30, 2005, the loss on early extinguishment of indebtedness included the write-off of unamortized deferred costs of $1,299 ($1,230 net of minority interest) relating to tax-exempt indebtedness assumed in connection with the sale of one community in August 2005, plus a loss of $547 ($518 net of minority interest) in connection with the termination of related interest rate cap agreements that were used as cash flow hedges of the assumed debt. For the nine months ended September 30, 2005, the loss on early extinguishment of indebtedness included the write-off of unamortized deferred costs of $2,265 ($2,142 net of minority interest) relating to tax-exempt indebtedness assumed in connection with the sale of two communities in May 2005 and

		one community in August 2005, plus a loss of $955 ($902 net of minority interest) in connection with the termination of related interest rate cap agreements that were used as cash flow hedges of the assumed debt.

(7)		Post Properties, Inc. is structured as an UPREIT, or Umbrella Partnership Real Estate Investment Trust. Post GP Holdings, Inc., a wholly owned subsidiary of the Company, is the sole general partner and, together with Post LP Holdings, Inc., owns the controlling interest in Post Apartment Homes, L.P., the Operating Partnership through which the Company conducts its operations. As of September 30, 2006, there were 44,145 units of the Operating Partnership outstanding, of which 43,440, or 98.4%, were owned by the Company. For the three and nine months ended September 30, 2005, the potential dilution from the Company’s outstanding stock options and awards of 441 and 293, respectively, was antidilutive to the continuing operations per share calculation. As such, these amounts were excluded from weighted average shares and units and the income (loss) per share calculations for the three and nine months ended September 30, 2005.

Post Properties, Inc.
Calculation of Funds from Operations
and Adjusted Funds From Operations Available
to Common Shareholders and Unitholders
(In thousands, except per share or unit data)
(Unaudited)

A reconciliation of net income available to common shareholders to funds from operations available to common shareholders and unitholders and adjusted funds from operations available to common shareholders and unitholders is provided below.


	Three months ended						Nine months ended
	September 30,						September 30,
	2006			2005			2006			2005
Net income available to common shareholders	$	33,892		$	71,332		$	48,858		$	130,634
Minority interest of common unitholders — continuing operations		87			(10	)		369			(226	)
Minority interest in discontinued operations (1)		577			4,014			633			7,814
Depreciation on wholly-owned real estate assets, net (2)		16,673			18,199			49,930			55,584
Depreciation on real estate assets held in unconsolidated entities		229			224			679			744
Gains on sales of real estate assets, net of provision for income taxes		(29,678	)		(76,720	)		(38,480	)		(139,290	)
Incremental gains (losses) on condominium sales, net of provision for income taxes (3)		(820	)		1,398			1,232			7,459
Gains on sales of real estate assets — unconsolidated entities		(174	)		(246	)		(247	)		(445	)
Incremental gains (losses) on condominium sales — unconsolidated entities (3)		47			258			(44	)		291

Funds from operations available to common shareholders and unitholders (A)	$	20,833		$	18,449		$	62,930		$	62,565


Funds from operations available to common shareholders and unitholders (A)	$	20,833		$	18,449		$	62,930		$	62,565
Annually recurring capital expenditures		(3,229	)		(2,350	)		(9,143	)		(7,172	)
Periodically recurring capital expenditures		(2,124	)		(607	)		(4,446	)		(2,636	)
Non-cash straight-line adjustment for ground lease expenses		307			310			926			941
Non-cash loss on early extinguishment of indebtedness associated with property sales		123			1,846			123			3,220
Non-cash income relating to mark-to-market of interest rate swap agreement		—			—			(1,655	)		—

Adjusted funds from operations available to common shareholders and unitholders (4)(B)	$	15,910		$	17,648		$	48,735		$	56,918


Per Common Share Data — Basic
Funds from operations per share or unit, as defined(A÷C)	$	0.48		$	0.43		$	1.45		$	1.47
Adjusted funds from operations per share or unit (4)(B÷C)	$	0.36		$	0.41		$	1.12		$	1.34
Dividends declared	$	0.45		$	0.45		$	1.35		$	1.35
Weighted average shares outstanding		43,137			40,372			42,616			40,157
Weighted average shares and units outstanding(C)		43,845			42,536			43,492			42,492

Per Common Share Data — Diluted
Funds from operations per share or unit, as defined(A÷D)	$	0.47		$	0.43		$	1.42		$	1.46
Adjusted funds from operations per share or unit (4)(B÷D)	$	0.36		$	0.41		$	1.10		$	1.33
Dividends declared	$	0.45		$	0.45		$	1.35		$	1.35
Weighted average shares outstanding (5)		43,955			40,813			43,387			40,450
Weighted average shares and units outstanding (5)(D)		44,663			42,977			44,263			42,785


(1)		Represents the minority interest in earnings and gains on sales of real estate assets reported as discontinued operations for the periods presented.

(2)		Depreciation on wholly-owned real estate assets is net of the minority interest portion of depreciation in consolidated entities.

(3)		The Company recognizes incremental gains on condominium sales in FFO, net of provision for income taxes, to the extent that net sales proceeds, less costs of sales, from the sale of condominium units exceeds the greater of their fair value or net book value as of the date the property is acquired by the Company’s taxable REIT subsidiary. See page 18 for further detail.

(4)		Since the Company does not add back the depreciation of non-real estate assets in its calculation of funds from operations, non-real estate related capital expenditures of $1,940 and $177 for the three months and $2,923 and $1,155 for the nine months ended September 30, 2006 and 2005, respectively, are excluded from the calculation of adjusted funds from operations available to common shareholders and unitholders.

(5)		Diluted weighted average shares and units include 441 and 293 shares and units, respectively, for the three and nine months ended September 30, 2005 that were antidilutive to the income (loss) per share computations under generally accepted accounting principles.

Post Properties, Inc.
Same Store Results
(In thousands, except per share or unit data)
(Unaudited)

Same Store Results

The Company defines fully stabilized or same store communities as those which have reached stabilization prior to the beginning of the previous calendar year, adjusted by communities sold, under rehabilitation and classified as held for sale. Same store net operating income is a supplemental non-GAAP financial measure. See Table 1 on page 27 for a reconciliation of same store net operating income to GAAP net income. The operating performance and capital expenditures of the 48 communities containing 17,961 apartment units which were fully stabilized as of January 1, 2005, is summarized as follows:


	Three months ended							Nine months ended
	September 30,							September 30,
	2006		2005		% Change			2006		2005		% Change
Rental and other revenues	$	64,350	$	60,931		5.6	%	$	188,565	$	178,661		5.5	%
Property operating and maintenance expenses (excluding depreciation and amortization)		24,973		23,539		6.1	%		72,521		69,366		4.5	%

Same store net operating income	$	39,377	$	37,392		5.3	%	$	116,044	$	109,295		6.2	%

Capital expenditures (1)
Annually recurring:
Carpet	$	1,246	$	806		54.6	%	$	2,857	$	2,051		39.3	%
Other		1,623		1,103		47.1	%		5,096		3,382		50.7	%

Total annually recurring		2,869		1,909		50.3	%		7,953		5,433		46.4	%
Periodically recurring		600		451		33.0	%		1,851		1,504		23.1	%

Total capital expenditures (A)	$	3,469	$	2,360		47.0	%	$	9,804	$	6,937		41.3	%

Total capital expenditures per unit (A ÷ 17,961 units)	$	193	$	131		47.0	%	$	546	$	386		41.3	%

Average monthly rental rate per unit (2)	$	1,178	$	1,111		6.0	%	$	1,151	$	1,102		4.4	%


(1)		See Table 3 on page 30 for a reconciliation of these segment components of property capital expenditures to total annually recurring capital expenditures and total periodically recurring capital expenditures as presented on the consolidated cash flow statements prepared under GAAP.

(2)		Average monthly rental rate is defined as the average of the gross actual rates for occupied units and the anticipated rental rates for unoccupied units divided by total units. Beginning in the fourth quarter of 2005, the Company adjusted its stated market rents at the majority of its communities to be more reflective of current market conditions. The impact of this change is estimated to have reduced the average monthly rental rate per unit by less than 1% for the three and nine months ended September 30, 2006.

Same Store Operating Results by Market –
Comparison of 2006 to 2005
(Increase (decrease) from same period in prior year)


	Three months ended												Nine months ended
	September 30,2006												September 30,2006
										Average												Average
										Economic												Economic
Market	Revenues(1)			Expenses(1)			NOI(1)			Occupancy			Revenues(1)			Expenses(1)			NOI(1)			Occupancy
Atlanta		4.5	%		12.4	%		(0.1	)%		1.1	%		3.5	%		7.1	%		1.4	%		1.2	%
Dallas		3.3	%		6.8	%		0.3	%		(1.3	)%		4.6	%		6.0	%		3.4	%		(0.1	)%
Tampa		8.1	%		3.7	%		11.0	%		(3.8	)%		8.7	%		1.1	%		13.8	%		(0.4	)%
Washington, DC		7.6	%		7.8	%		7.6	%		0.2	%		6.5	%		3.4	%		8.2	%		0.1	%
Charlotte		7.9	%		(0.2	)%		11.9	%		(2.3	)%		8.3	%		5.1	%		9.9	%		0.4	%
Houston		6.9	%		(22.9	)%		68.3	%		(1.1	)%		9.8	%		(8.9	)%		36.0	%		4.5	%
New York		9.0	%		(0.1	)%		12.5	%		(0.5	)%		9.4	%		5.0	%		11.3	%		0.5	%
Orlando		6.9	%		13.1	%		3.0	%		(3.0	)%		9.1	%		4.7	%		12.4	%		(1.7	)%

Total		5.6	%		6.1	%		5.3	%		(0.4	)%		5.5	%		4.5	%		6.2	%		0.7	%


(1)		See Table 2 on page 28 for a reconciliation of these components of same store net operating income and Table 1 on page 27 for a reconciliation of same store net operating income to GAAP net income.

Same Store Occupancy by Market


						Average Economic						Average Economic
			% of NOI			Occupancy (1)						Occupancy (1)						Physical
			Three months ended			Three months ended						Nine months ended						Occupancy
	Apartment		September 30,			September 30,						September 30,						at September 30,
Market	Units		2006			2006			2005			2006			2005			2006 (2)
Atlanta		8,284		41.2	%		95.2	%		94.1	%		94.4	%		93.2	%		94.8	%
Dallas		3,607		15.2	%		92.8	%		94.1	%		93.5	%		93.6	%		93.2	%
Tampa		1,883		11.0	%		94.0	%		97.8	%		96.8	%		97.2	%		92.5	%
Washington, DC		1,703		14.6	%		97.5	%		97.3	%		97.4	%		97.3	%		94.1	%
Charlotte		1,065		6.4	%		95.8	%		98.1	%		96.1	%		95.7	%		91.8	%
Houston		837		3.6	%		91.9	%		93.0	%		94.0	%		89.5	%		90.8	%
New York		337		6.5	%		96.2	%		96.7	%		96.3	%		95.8	%		96.1	%
Orlando		245		1.5	%		94.2	%		97.2	%		96.3	%		98.0	%		91.4	%

Total		17,961		100.0	%		94.9	%		95.3	%		95.1	%		94.4	%		93.8	%


(1)		The calculation of average economic occupancy does not include a deduction for net concessions and employee discounts. Average economic occupancy, including these amounts would have been 94.0% and 94.4% for the three months ended September 30, 2006 and 2005, respectively, and 94.3% and 93.4% for the nine months ended September 30, 2006 and 2005, respectively. For the three months ended September 30, 2006 and 2005, net concessions were $349 and $372, respectively, and employee discounts were $208 and $142, respectively. For the nine months ended September 30, 2006 and 2005, net concessions were $945 and $1,315, respectively, and employee discounts were $554 and $428, respectively. Beginning in the fourth quarter of 2005, the Company adjusted its stated market rents at the majority of its communities to be more reflective of current market conditions. The impact of this change is estimated to have increased the computed average economic occupancy amounts by less than 1% for the three and nine months ended September 30, 2006.

(2)		Physical occupancy is defined as the number of units occupied divided by total apartment units, expressed as a percentage.

Same Store Sequential Comparison


	Three months ended
	September 30,			June 30,
	2006			2006			% Change
Rental and other revenues	$	64,350		$	62,865			2.4	%
Property operating and maintenance expenses (excluding depreciation and amortization)		24,973			24,026			3.9	%

Same store net operating income (1)	$	39,377		$	38,839			1.4	%

Average economic occupancy		94.9	%		95.2	%		(0.3	)%

Average monthly rental rate per unit	$	1,178		$	1,147			2.7	%


(1)		See Table 2 on page 28 for a reconciliation of these components of same store net operating income and Table 1 on page 27 for a reconciliation of same store net operating income to GAAP net income.

Sequential Same Store Operating Results by Market –
Comparison of Third Quarter of 2006 to Second Quarter 2006
(Increase (decrease) between periods)


										Average
										Economic
Market	Revenues(1)			Expenses(1)			NOI(1)			Occupancy
Atlanta		2.9	%		4.8	%		1.8	%		1.1	%
Dallas		1.3	%		6.1	%		(2.6	)%		(1.2	)%
Tampa		1.8	%		5.8	%		(0.6	)%		(3.5	)%
Washington, DC		2.5	%		1.7	%		2.9	%		(0.1	)%
Charlotte		3.2	%		(3.6	)%		6.7	%		(0.8	)%
Houston		1.1	%		1.1	%		1.0	%		(2.8	)%
New York		2.9	%		(1.5	)%		4.5	%		(0.3	)%
Orlando		0.7	%		3.3	%		(1.0	)%		(1.8	)%

Total		2.4	%		3.9	%		1.4	%		(0.3	)%


(1)		See Table 2 on page 28 for a reconciliation of these components of same store net operating income and Table 1 on page 27 for a reconciliation of same store net operating income to GAAP net income.

Post Properties, Inc.
Consolidated Balance Sheets
(In thousands, except per share or unit data)


	September 30,			December 31,
	2006			2005
	(Unaudited)
Assets
Real estate assets
Land	$	275,928		$	266,914
Building and improvements		1,791,088			1,789,479
Furniture, fixtures and equipment		201,765			207,497
Construction in progress		114,204			47,005
Land held for future development		79,724			62,511

		2,462,709			2,373,406
Less: accumulated depreciation		(530,090	)		(516,954	)
For-sale condominiums (1)		31,481			38,338
Assets held for sale, net of accumulated depreciation of $19,004 and $0 at September 30, 2006 and December 31, 2005, respectively (2)		33,944			4,591

Total real estate assets		1,998,044			1,899,381
Investments in and advances to unconsolidated real estate entities		34,465			26,614
Cash and cash equivalents		5,386			6,410
Restricted cash		5,314			4,599
Deferred charges, net		13,311			11,624
Other assets		33,594			32,826

Total assets	$	2,090,114		$	1,981,454


Liabilities and shareholders’ equity
Indebtedness	$	1,024,440		$	980,615
Accounts payable and accrued expenses		67,819			53,429
Dividend and distribution payable		21,774			19,257
Accrued interest payable		14,849			5,478
Security deposits and prepaid rents		11,060			9,857

Total liabilities		1,139,942			1,068,636


Minority interest of common unitholders in Operating Partnership		13,691			26,764
Minority interests in consolidated real estate entities		2,421			5,045

Total minority interests		16,112			31,809


Shareholders’ equity
Preferred stock, $.01 par value, 20,000 authorized:
8 1/2% Series A Cumulative Redeemable Shares, liquidation preference $50 per share, 900 shares issued and outstanding		9			9
7 5/8% Series B Cumulative Redeemable Shares, liquidation preference $25 per share, 2,000 shares issued and outstanding		20			20
Common stock, $.01 par value, 100,000 authorized:
43,440 and 41,394 shares issued, 43,440 and 41,394 shares outstanding at September 30, 2006 and December 31, 2005, respectively		434			414
Additional paid-in-capital		863,032			803,765
Accumulated earnings		76,897			86,315
Accumulated other comprehensive income (loss)		(4,109	)		(4,208	)
Deferred Compensation		—			(3,625	)

		936,283			882,690

Less common stock in treasury, at cost, 56 and 44 shares at September 30, 2006 and December 31, 2005, respectively		(2,223	)		(1,681	)

Total shareholders’ equity		934,060			881,009

Total liabilities and shareholders’ equity	$	2,090,114		$	1,981,454


(1)		Consists of two communities, originally containing 349 units, being converted into for-sale condominiums through the Company’s taxable REIT subsidiaries.

(2)		Consists of one community, originally containing 127 units, reflected in discontinued operations, which is being converted into for-sale condominiums through the Company’s taxable REIT subsidiaries and three communities, containing 826 units, classified as held for sale during the third quarter of 2006.

Post Properties, Inc.
Consolidated Debt Summary
(Dollars in thousands, except per share or unit data)
(Unaudited)

Summary of Outstanding Debt at September 30, 2006


						Weighted Average Rate (1)
			Percentage			Three months ended September 30,
Type of Indebtedness	Balance		of Total			2006			2005
Unsecured fixed rate senior notes	$	585,000		57.1	%		6.4	%		6.5	%
Secured tax exempt variable rate notes (2)		28,495		2.8	%		4.2	%		3.1	%
Secured conventional fixed rate notes		401,992		39.2	%		6.3	%		6.3	%
Lines of credit		8,953		0.9	%		5.9	%		4.0	%
	$	1,024,440		100.0	%		6.3	%		6.1	%


			Percentage			Weighted Average Maturity
	Balance		of Total Debt			of Total Debt (3)
Total fixed rate debt	$	986,992		96.3	%					6.0
Total variable rate debt		37,448		3.7	%					15.1
Total debt	$	1,024,440		100.0	%					6.3

Debt Maturities


				Weighted Average Rate
Aggregate debt maturities by year	Amount			on Debt Maturities (1)
Remainder of 2006	$	26,373			6.9	%
2007		158,828			6.4	%
2008		5,230			6.2	%
2009		76,618			5.5	%
2010		197,981	(4)		7.6	%
Thereafter		559,410			5.9	%
	$	1,024,440

Debt Statistics


	Nine months ended
	September 30,
	2006			2005
Interest coverage ratio (5)(6)		2.6	x		2.2	x
Fixed charge coverage ratio (5)(7)		2.3	x		2.0	x

Total debt as a % of undepreciated real estate assets (adjusted for joint venture partner’s share of debt) (8)		40.1	%		39.7	%
Total debt and preferred equity as a % of undepreciated real estate assets (adjusted for joint venture partner’s share of debt) (8)		43.7	%		43.6	%


(1)		Weighted average rate includes credit enhancements and other fees, where applicable. The weighted average rates for the three months ended September 30, 2005 are based on the debt outstanding for that period.

(2)		The Company has an interest rate cap arrangement that limits the Company’s exposure to increases in the base rate to 5.0%.

(3)		Weighted average maturity of total debt represents number of years to maturity based on the debt maturities schedule above.

(4)		Includes outstanding balances on lines of credit of $8,953 maturing in 2010.

(5)		Calculated for the nine months ended September 30, 2006 and 2005.

(6)		Interest coverage ratio is defined as net income available for debt service divided by interest expense. For purposes of this calculation, net income available for debt service represents income from continuing operations, before preferred or common minority interest, gains on sales of real estate and investment sales, interest expense, depreciation and amortization. Net income available for debt service was also adjusted for the Company’s share of depreciation and interest expense from unconsolidated entities and interest expense used in the calculation was adjusted to include the Company’s share of interest expense from unconsolidated entities. The calculation of the interest coverage ratio is a non-GAAP financial measure. A reconciliation of net income available for debt service to income from continuing operations and interest expense to consolidated interest expense is included in Table 4 on page 31.

(7)		Fixed charge coverage ratio is defined as net income available for debt service divided by interest expense plus dividends to preferred shareholders and distributions to preferred unitholders. For purposes of this calculation, net income available for debt service represents earnings from continuing operations, before preferred or common minority interest, gains on sales of real estate and investment sales, interest expense, depreciation and amortization. Net income available for debt service was also adjusted for the Company’s share of depreciation and interest expense from unconsolidated entities and interest expense used in the calculation was adjusted to include the Company’s share of interest expense from unconsolidated entities. The calculation of the fixed coverage ratio is a non-GAAP financial measure. A reconciliation of net income available for debt service to income from continuing operations and fixed charges to consolidated interest expense plus preferred dividends to shareholders and preferred distributions to unitholders is included in Table 4 on page 31.

(8)		A computation of the debt ratios is included in Table 5 on page 32.

Post Properties, Inc.
Consolidated Debt Summary (cont.)
(Dollars in thousands, except per share or unit data)
(Unaudited)

Financial Debt Covenants — Senior Unsecured Public Notes


	As of
Covenant requirement(1)	September 30, 2006
Consolidated Debt to Total Assets cannot exceed 60%		39	%
Secured Debt to Total Assets cannot exceed 40%		16	%
Total Unencumbered Assets to Unsecured Debt must be at least 1.50/1		3.20	x
Consolidated Income Available for Debt Service Charge must be at least 1.50/1		2.59	x


(1)		A summary of the public debt covenant calculations and reconciliations of the financial components used in the public debt covenant calculations to the most comparable GAAP financial measures are detailed below.


	As of
	September 30, 2006
Ratio of Consolidated Debt to Total Assets

Consolidated debt, per balance sheet(A)	$	1,024,440

Total assets, as defined(B)(Table A)	$	2,625,897

Computed ratio(A÷B)		39	%

Required ratio (cannot exceed)		60	%


Ratio of Secured Debt to Total Assets

Secured conventional fixed and variable rate notes	$	401,992
Secured tax exempt variable rate notes		28,495

Total secured debt(C)	$	430,487

Computed ratio(C÷B)		16	%

Required ratio (cannot exceed)		40	%


Ratio of Total Unencumbered Assets to Unsecured Debt

Consolidated debt, per balance sheet(A)	$	1,024,440
Total secured debt(C)		430,487

Total unsecured debt(D)	$	593,953

Total unencumbered assets, as defined(E)(Table A)	$	1,901,707

Computed ratio(E÷D)		3.20	x

Required minimum ratio		1.50	x


Ratio of Consolidated Income Available for Debt Service to Annual Debt Service Charge

Consolidated Income Available for Debt Service, as defined(F)(Table B)	$	149,676

Annual Debt Service Charge, as defined(G)(Table B)	$	57,893

Computed ratio(F÷G)(2)		2.59x

Required minimum ratio		1.50x

Post Properties, Inc.
Consolidated Debt Summary (cont.)
(Dollars in thousands, except per share or unit data)
(Unaudited)

Table A

Calculation of Total Assets and Total Unencumbered Assets for Public Debt
Covenant Computations


	As of
	September 30, 2006
Total real estate assets	$	1,998,044

Add:
Investments in unconsolidated real estate entities		34,465
Accumulated depreciation		530,090
Accumulated depreciation on assets held for sale		19,004
Other tangible assets		44,294


Total assets for public debt covenant computations		2,625,897
Less:
Encumbered real estate assets		724,190

Total unencumbered assets for public debt covenant computations	$	1,901,707

Table B

Calculation of Consolidated Income Available for Debt Service and Annual Debt
Service Charge for Public Debt Covenant Computations(1)


	Nine months ended
	September 30, 2006
Consolidated income available for debt service
Net income	$	54,586

Add:
Minority interests		1,002
Provision for income taxes		—

Income before minority interest and provision for income taxes		55,588

Add:
Depreciation		50,101
Depreciation (company share) of assets held in unconsolidated entities		679
Depreciation of discontinued operations		1,639
Amortization of deferred financing costs		2,651
Interest expense		40,281
Interest expense (company share) of assets held in unconsolidated entities		745
Interest expense of discontinued operations		2,394
Less:
Gains on sales of condominiums, net — continuing operations		(10,022	)
Gains on sales of real estate assets — discontinued operations		(28,457	)
Gains on sales of real estate assets — unconsolidated entities		(247	)
Other income		(3,095	)


Consolidated income available for debt service	$	112,257

Consolidated income available for debt service (annualized)	$	149,676

Annual debt service charge
Consolidated interest expense	$	40,281
Interest expense (company share) of assets held in unconsolidated entities		745
Interest expense of discontinued operations		2,394

	$	43,420

Annual debt service charge (interest expense annualized)	$	57,893


(1)		The actual calculation of these ratios requires the use of annual trailing financial data. These computations reflect annualized 2006 results for comparison and presentation purposes. The computations using annual trailing financial data also reflect compliance with the debt covenants.

Post Properties, Inc.
Summary Of Communities Under Construction

Estimated

Costs Incurred

Quarter of

Estimated

Units

Number

Construction

as of

Construction

First Units

Stabilized

Units

Quarter

Under

Units

Community

Location

of Units

Cost

September 30, 2006

Start

Available

Occupancy (1)

Leased

Sell-out

Contract

Closed

($ in millions)

Apartments:

Washington,

Post Carlyle™

D.C. Area

205

56.5

49.7

4Q 2004

4Q 2006

4Q 2007

—

N/A

Post Alexander™

Atlanta, GA

307

62.8

13.2

2Q 2006

1Q 2008

1Q 2009

—

N/A

Post Eastside™

Dallas, TX

435

53.9

6.7

4Q 2006

4Q 2007

1Q 2009

—

N/A

Post Hyde Park® (expansion)

Tampa, FL

18.6

(5)

4.9

4Q 2006

1Q 2008

4Q 2008

—

N/A

Total Apartments

1,031

191.8

74.5

—

Weighted average projected property net operating income as a % of total estimated construction cost(3)

6.00% – 6.75

Condominiums:

Washington,

The Condominiums at Carlyle Square™(2)

D.C. Area

145

43.7

33.7

4Q 2004

1Q 2007

N/A

1Q 2008

—

Mercer Square™

Dallas, TX

17.1

6.0

2Q 2006

3Q 2007

N/A

3Q 2008

—

Total Condominiums

230

60.8

39.7

—

Weighted average projected pre-tax profit as a % of total estimated construction cost(4)

> 20


(1)		The Company defines stabilized occupancy as the earlier to occur of (i) the attainment of 95% physical occupancy on the first day of any month or (ii) one year after completion of construction.

(2)		The condominium component of the project, consisting of 145 units, is being developed in a majority owned joint venture with a Washington D.C. based developer. As of October 23, 2006, the Company has 91 units under contract for sale upon completion and delivery of the units. There can be no assurance that condominium units under contract will close.

(3)		The calculation represents the aggregate projected unlevered property net operating income to be earned by the apartment communities in their first year of stabilized operations (after deducting a 3% management fee and a $300 per unit capital reserve) divided by aggregate estimated construction costs of the apartment communities. The Company uses property net operating income as a management tool to measure the operating performance of its apartment communities. There can be no assurance that these percentages will be achieved.

(4)		The Company defines “pre-tax profit” to equal projected net revenues from condominium activities less projected costs and expenses from condominium activities before the impact of income tax expense. There can be no assurance that such pre-tax profit percentages will be achieved.

(5)		Total estimated construction costs for the Post Hyde Park® expansion include the estimated replacement costs of six apartment units at the Company’s existing Hyde Park community that are being demolished to accommodate the expansion.

Post Properties, Inc.
Summary Of Communities Under Rehabilitation
(Dollars in thousands, except per square foot)


								Average Monthly Rental				Property NOI		Property NOI						Number of Units
								Rate Per Sq. Ft.(1)				For the Fiscal		For the		Undepreciated		Projected		As of September 30, 2006
						Average		Actual		Projected		Year Preceding		Three Months		Book Value		Total
		Year		Total		Sq. Ft.		Prior to		After		The Start of		Ended		Prior to		Rehabilitation				Out
Project	Location	Completed		Units		Per Unit(1)		Rehabilitation		Rehabilitation		Rehabilitation		September 30, 2006		Rehabilitation		Capital Cost(2)		Completed		of Service
Post Chastain®	Atlanta, GA		1990		558		867	$	1.09	$	1.29	$	3,693	$	808	$	48,133	$	16,200		62		54
Post Worthington™	Dallas, TX		1993		332		819	$	1.32	$	1.58	$	2,384		74		41,139		9,900		91		44

					890											$	89,272	$	26,100		153		98


	Rehabilitation Cost Incurred in												Projected
	The Three Months Ended						Rehabilitation Capital Cost Incurred						Remaining
	September 30, 2006						As of September 30, 2006						Rehabilitation				Projected		Projected
	Revenue-		Non-Revenue-		Total		Revenue-		Non-Revenue-		Total		Capital Cost		Quarter of		Quarter of		Quarter of
	Generating		Generating		Capital		Generating		Generating		Capital		To be		Rehabilitation		Rehabilitation		Re-Stabilized
Project	Capital Cost		Capital Cost		Cost		Capital Cost		Capital Cost		Cost		Incurred		Start		Completion		Occupancy
Post Chastain®	$	1,667	$	194	$	1,861	$	2,408	$	194	$	2,602	$	13,598		2Q 2006		2Q 2008		3Q 2008
Post Worthington™		1,986		14		2,000		4,082		197		4,279		5,621		1Q 2006		2Q 2007		3Q 2007

	$	3,653	$	208	$	3,861	$	6,490	$	391	$	6,881	$	19,219


(1)		Average square footage information is based on approximate amounts and individual unit sizes may vary. There can be no assurance that the projected average monthly rental rates after the rehabilitation will be achieved.

(2)		Includes approximately $2,600 of projected non-revenue generating capital costs.

Post Properties, Inc.
Summary Of Condominium Conversion Projects
(Dollars in thousands)


								# of Rental Units		Average							Units(4)
		Year		Sale		Total		Occupied as of		Unit		Project Transfer		Book Value as of							Under		Available
Project	Location	Completed		Start Date		Units		September 30, 2006		Sq. Ft.(1)		Price(2)		September 30, 2006(3)			Total		Closed		Contract		for Sale
588^TM	Dallas, TX		2000		Q1 2005		127		—		1,470	$	20,274	$	387			127		126		—		1
The Peachtree Residences^TM (5)	Atlanta, GA		2001		Q2 2005		121		—		1,340		30,190		3,846	(8)		121		98		6		17
Harbour Place City Homes™	Tampa, FL		1999		Q2 2006		206		4		1,036		37,000		10,394			206		85		5		116
RISE^TM	Houston, TX		2000		Q2 2006		143		58		1,407		26,250		21,087			143		21		10		112
Hyde Park Walk^TM	Tampa, FL		1997		Q2 2005		134		—		890		16,755		—			134		134		—		—

														$	35,714			731		464		21		246


	Three months ended							Three months ended							Nine months ended							Nine months ended							Cumulative through
	September 30, 2006							September 30, 2005							September 30, 2006							September 30, 2005							September 30, 2006
					FFO							FFO							FFO
					Incremental							Incremental							Incremental							FFO							FFO
	Units		Gross		Gain on			Units		Gross		Gain on			Units		Gross		Gain on			Units		Gross		Incremental			Units		Gross		Incremental
Project	Closed		Revenues		Sale(6)(7)			Closed		Revenues		Sale(6)(7)			Closed		Revenues		Sale(6)(7)			Closed		Revenues		Gain on Sale(6)(7)			Closed		Revenues		Gain on Sale(6)
588^TM		2	$	504	$	(54	)		29	$	9,239	$	1,121			22	$	7,022	$	337			82	$	20,678	$	2,303			125	$	33,697	$	3,565
The Peachtree Residences^TM (5)		22		7,289		47			13		4,769		258			51		16,513		(44	)		25		9,191		291			96		31,595		315
Harbour Place City Homes™		15		4,058		(704	)		—		—		—			83		21,028		1,319			—		—		—			83		21,028		1,319
RISE^TM		10		2,649		(24	)		—		—		—			17		4,142		(97	)		—		—		—			17		4,142		(97	)
Hyde Park Walk^TM		—		—		—			6		2,672		646			—		—		—			134		29,338		6,177			134		29,338		6,177

		49		14,500		(735	)		48		16,680		2,025			173		48,705		1,515			241		59,207		8,771			455		119,800		11,279
Other		—		71		(38	)		—		—		(99	)		—		71		(327	)		—		—		(368	)		—		71		(858	)

		49	$	14,571	$	(773	)		48	$	16,680	$	1,926			173	$	48,776	$	1,188			241	$	59,207	$	8,403			455	$	119,871	$	10,421


(1)		Average square footage information is based on approximate amounts and individual unit sizes may vary.

(2)		Transfer price for purposes of computing incremental gains on condominium sales included in FFO reflects the greater of (1) the estimated fair value on the date the project was acquired by the Company’s taxable REIT subsidiary (as supported by independently-prepared, third-party appraisals) or (2) its net book value at that time.

(3)		Including total estimated construction costs of ground-up condominiums being developed (see page 16) of approximately $60.8 million and book value of unsold condominium conversions above, committed capital to the condominium business at September 30, 2006 totaled approximately $96.5 million.

(4)		Unit status is as of October 23, 2006. There can be no assurance that condominium units under contract will close.

(5)		The Peachtree Residences^TM is owned in an unconsolidated entity, where the Company’s equity ownership is 35%. Amounts shown, except for incremental gains on condominium sales included in FFO, represents gross amounts at the unconsolidated entity level.

(6)		The Company recognizes incremental gains on condominium sales in FFO, net of provision for income taxes, to the extent that net sales proceeds, less costs of sales, from the sale of condominium units exceeds the “transfer price” as described in note 2 above.

(7)		Excludes the impact of income tax expense attributable to gains on condominium sales of $0 or the three and nine months ended September 30, 2006, respectively, and $270 and $653 for the three and nine months ended September 30, 2005, respectively.

(8)		Represents the Company’s 35% equity investment in an unconsolidated entity.

Post Properties, Inc.
Community Acquisition and Disposition Summary


						Gross Amount		Gross
Property Name/Period	Location	Units		Year Built		Per Unit		Amount
Acquisitions

Q2 2005
Post Ballantyne	Charlotte, NC		319		2004	$	116,771	$	37,250,000
2005 YTD Total								$	37,250,000


Average Cap Rate – Acquisitions – 2005									5.6	%(1)


Q1 2006
Post Barton Creek™	Austin, TX		160		1998	$	166,875	$	26,700,000
Post Park Mesa™	Austin, TX		148		1992	$	132,095		19,550,000

Q3 2006
Post Fallsgrove	Washington D.C. Area		361		2003	$	227,465	$	82,115,000	(4)
2006 YTD Total								$	128,365,000


Average Cap Rate – Acquisitions – 2006									4.6	%(2)


Dispositions

Q2 2005
Post American Beauty Mill™	Dallas, TX		80		1998	$	63,125
Post Bennie Dillon™	Nashville, TN		86		1999	$	119,767
Post Corners®	Atlanta, GA		460		1986	$	63,696
Post Walk®	Atlanta, GA		476		1984-1987	$	88,445
Post White Rock®	Dallas, TX		207		1988	$	59,420	$	99,050,000

Q3 2005
Post Village®	Atlanta, GA		1,738		1983-1988	$	76,237	$	132,500,000
2005 YTD Total								$	231,550,000


Average Cap Rate – Dispositions – 2005									5.9	%(3)


Q3 2006
Post Uptown Square™	Denver, CO		696		1999-2001	$	169,540	$	118,000,000
2006 YTD Total								$	118,000,000


Average Cap Rate – Dispositions – 2006									4.6	%(3)


(1)		Based on projected first twelve-month net operating income after adjustment for management fee (3.0%) and capital reserves ($300/unit). Also assumes that the Company will initially spend up to $2 million relating to closing costs, reimbursement of a fee to terminate a loan commitment that the seller had previously entered into in connection with the community and other amounts it plans to spend to improve the community.

(2)		Based on projected first twelve-month net operating income after adjustment for management fee (3.0%) and capital reserves ($300/unit). Also assumes that the Company will initially spend up to $4.5 million relating to closing costs and other amounts it plans to spend to improve these communities.

(3)		Based on trailing twelve-month net operating income after adjustments for management fee (3.0%) and capital reserves ($300/unit).

(4)		The Company may be required to pay additional purchase consideration of up to $6.6 million based on a share of the appreciation in the value of the community, if any, over the next four years.

Post Properties, Inc.
Capitalized Costs Summary
(Dollars in thousands, except per share or unit data)
(Unaudited)

The Company has a policy of capitalizing those expenditures relating to the acquisition of new assets and the development, construction and rehabilitation of apartment and condominium communities. In addition, the Company capitalizes expenditures that enhance the value of existing assets and expenditures that substantially extend the life of existing assets. All other expenditures necessary to maintain a community in ordinary operating condition are expensed as incurred. Additionally, for new development communities, carpet, vinyl and blind replacements are expensed as incurred during the first five years (which corresponds to the estimated depreciable life of these assets) after construction completion. Thereafter, these replacements are capitalized. Further, the Company expenses as incurred the interior and exterior painting of operating communities, except such costs at communities under major rehabilitation programs.

The Company capitalizes interest, real estate taxes, and certain internal personnel and associated costs related to apartment and condominium communities under development, construction, and major rehabilitation. The internal personnel and associated costs are capitalized to the projects under development based upon the effort identifiable with such projects. The Company treats each unit in an apartment and condominium community separately for cost accumulation, capitalization and expense recognition purposes. Prior to the commencement of leasing and sales activities, interest and other construction costs are capitalized and are reflected on the balance sheet as construction in progress. The Company ceases the capitalization of such costs as the residential units in a community become substantially complete and available for occupancy. This results in a proration of these costs between amounts that are capitalized and expensed as the residential units in a development community become available for occupancy. In addition, prior to the completion of units, the Company expenses as incurred substantially all operating expenses (including pre-opening marketing and property management and leasing personnel expenses) of such communities.

A summary of community acquisition and development improvements and other capitalized expenditures for the three and nine months ended September 30, 2006 and 2005 is detailed below.


	Three months ended				Nine months ended
	September 30,				September 30,
	2006		2005		2006		2005
Development and acquisition expenditures (1)	$	93,973	$	11,477	$	238,509	$	104,874
Periodically recurring capital expenditures
Community rehabilitation and other revenue generating improvements (2)		3,653		—		6,490		—
Other community additions and improvements (3)		2,124		607		4,446		2,636
Annually recurring capital expenditures
Carpet replacements and other community additions and improvements (4)		3,229		2,350		9,143		7,172
Corporate additions and improvements		1,940		177		2,923		1,155
	$	104,919	$	14,611	$	261,511	$	115,837


Other Data
Capitalized interest	$	2,923	$	770	$	7,061	$	1,553

Capitalized development costs and fees (5)	$	612	$	316	$	1,366	$	882


(1)		Reflects aggregate community acquisition and development costs, exclusive of the change in construction payables and assured debt, if any, between years.

(2)		Represents expenditures for major community rehabilitations and other unit upgrade costs that enhance the rental value of such units (see page 17).

(3)		Represents community improvement expenditures (e.g. property upgrades) that generally occur less frequently than on an annual basis.

(4)		Represents community improvement expenditures (e.g. carpets, appliances) of a type that are expected to be incurred on an annual basis.

(5)		Reflects internal personnel and associated costs capitalized to construction and development activities.

Post Properties, Inc.
Investments in Unconsolidated Real Estate Entities
(Dollars in thousands, except per share or unit data)
(Unaudited)

Apartments and Condominium Conversion Communities

The Company holds investments in three individual limited liability companies (the “Property LLCs”) with an institutional investor. Two of the Property LLCs own single apartment communities. The third Property LLC is converting its apartment community, originally containing 121 units, into for-sale condominiums. The Company holds a 35% equity interest in the Property LLCs.

The Company accounts for its investments in these Property LLCs using the equity method of accounting. The excess of the Company’s investment over its equity in the underlying net assets of the Property LLCs was approximately $5,607 at September 30, 2006. The excess investment related to Property LLCs holding apartment communities is being amortized as a reduction to earnings on a straight-line basis over the lives of the related assets. The excess investment of approximately $228 at September 30, 2006 related to the Property LLC holding the condominium conversion community will be recognized as additional cost of sales as the underlying condominiums are sold. The Company provides real estate services (development, construction and property management) to the Property LLCs for which it earns fees.

The operating results of the Company include its proportionate share of net income from the investments in the Property LLCs. A summary of financial information for the Property LLCs in the aggregate was as follows:


	September 30,		December 31,
Balance Sheet Data	2006		2005
Real estate assets, net of accumulated depreciation on $10,289 and $8,349, respectively	$	94,309	$	96,000
Assets held for sale, net (1)		6,431		17,715
Cash and other		5,760		1,770

Total assets	$	106,500	$	115,485

Mortgage notes payable	$	66,998	$	66,999
Mortgage notes payable to Company		—		5,967
Other liabilities		1,053		996

Total liabilities		68,051		73,962
Members’ equity		38,449		41,523

Total liabilities and members’ equity	$	106,500	$	115,485

Company’s equity investment	$	19,074	$	20,647


(1)		Includes one community, originally containing 121 units, being converted into condominiums through a taxable REIT subsidiary.


	Three months ended						Nine months ended
	September 30,						September 30,
	2006			2005			2006			2005
Revenues
Rental	$	2,900		$	2,720		$	8,624		$	8,081
Other property revenues		208			231			610			645

Total revenues		3,108			2,951			9,234			8,726

Expenses
Property operating and maintenance		964			877			2,877			2,676
Depreciation and amortization		665			656			1,985			1,963
Interest		688			688			2,064			2,064

Total expenses		2,317			2,221			6,926			6,703

Income from continuing operations		791			730			2,308			2,023
Discontinued operations
Loss from discontinued operations		(75	)		(23	)		(359	)		(119	)
Gains on sales of real estate assets, net		997			994			1,897			1,849
Loss on early extinguishment of debt		—			—			—			(273	)

Income from discontinued operations		922			971			1,538			1,457

Net income	$	1,713		$	1,701		$	3,846		$	3,480

Company’s share of net income	$	527		$	592		$	1,251		$	1,294

For the periods presented, gains on sales of real estate assets represent net gains from condominium sales at the condominium conversion community held by one of the Property LLCs. A summary of revenues and costs and expenses of condominium activities for the three and nine months ended September 30, 2006 and 2005 was as follows:


	Three months ended						Nine months ended
	September 30,						September 30,
	2006			2005			2006			2005
Condominium revenue	$	7,289		$	4,769		$	16,513		$	9,191
Condominium costs and expenses		(6,292	)		(3,775	)		(14,616	)		(7,342	)

Gains on condominium sales, net	$	997		$	994		$	1,897		$	1,849

At September 30, 2006, mortgage notes payable include a $49,998 mortgage note that bears interest at 4.13%, requires monthly interest payments and annual principal payments of $1 through 2009. Thereafter, the note requires monthly principal and interest payments based on a 25-year amortization schedule and matures in April 2034. The note is callable by the lender in May 2009 and on each successive fifth year anniversary of the note thereafter. The note is prepayable without penalty in May 2008. The additional mortgage note payable totaling $17,000 bears interest at a rate of 4.04% and matures in 2008.

In 2005, one of the Property LLCs elected to convert its apartment community into for-sale condominiums. As a result of its decision to sell the community through the condominium conversion process, the Property LLC prepaid its third party mortgage note payable of $16,392 through secured borrowings from the Company. The Property LLC incurred debt prepayment costs and expenses associated with the write-off of unamortized deferred financing costs totaling $273 in March 2005. The mortgage note payable to the Company had a fixed rate component ($16,392) bearing interest at 4.28% and a variable rate component bearing interest at LIBOR at 1.90%. In the second quarter of 2006, the mortgage note payable was retired from the proceeds of condominium sales.

Land Entities

At September 30, 2006, the Company holds a 50% equity interest in a limited liability company whose sole investment consists of a partnership interest in an entity (the “Land Partnership”) which holds land for future development. At September 30, 2006, the Land Partnership had total assets of $24,985, principally land held for future development, total liabilities of $13,171 (including a secured note payable of $12,000 to the Company) and total equity of $11,814 (including the Company’s equity investment of $3,391).

Post Properties, Inc.
Net Asset Value Supplemental Information
(Dollars in thousands, except per share or unit data)
(Unaudited)

This supplemental financial and other data provides adjustments to certain GAAP financial measures and Net Operating Income, which is a supplemental non-GAAP financial measure that the Company makes internally to calculate Net Asset Value (“NAV”). In addition, the Company believes that investors and analysts use similar measures in estimating the Company’s NAV. These measures, as adjusted, are supplemental non-GAAP financial measures. With the exception of Net Operating Income, the most comparable GAAP measure for each of the non-GAAP measures presented below in the “As Adjusted” column is the corresponding number presented in the first column listed below. In the information below, the Company presents Net Operating Income for the quarter ended September 30, 2006 for properties stabilized by the beginning of the quarter ended September 30, 2006 so that a capitalization rate may be applied and an approximate value for the assets determined. Properties not stabilized by the beginning of the quarter ended September 30, 2006 are presented at full undepreciated cost. Other tangible assets are also presented, as well as total liabilities and the liquidation value of preferred shares. The Company believes it is important to provide these measures to allow investors to easily develop their own calculations of NAV. The Company also believes that internal and external NAV estimates are a useful benchmark of the value of the Company’s assets over time and provide a useful measure for analyzing the Company’s trading price on the New York Stock Exchange.

Financial Data
(In thousands)


	Three months ended					As
	September 30, 2006		Adjustments			Adjusted
Income Statement Data
Rental revenues	$	72,216	$	(1,640	)(1)	$	70,576
Other property revenues		4,609		(65	)(1)		4,544

Total rental and other revenues(A)		76,825		(1,705	)		75,120
Property operating & maintenance expenses (excluding depreciation and amortization)(B)		35,790		(6,142	)(1)		29,648

Property net operating income (Table 1)(A-B)	$	41,035	$	(4,437	)	$	45,472	(2)

Apartment units represented		22,239		(1,746	)(3)		20,493


		As of					As
		September 30, 2006		Adjustments			Adjusted
Other Asset Data
Cash & equivalents		$	5,386	$	—		$	5,386
Construction in progress and real estate assets acquired, at cost			114,204		84,174	(4)		198,378
Land held for future development			79,724		—			79,724
For-sale condominiums and assets held for sale			65,425		(20,332	)(5)		45,093
Investments in and advances to unconsolidated real estate entities (6)			34,465		(19,074	)(6)		15,391
Other assets (7)			38,908		—			38,908
Cash and other assets of unconsolidated real estate entities			5,760		(3,744	)(8)		2,016
	��
		$	343,872	$	41,024		$	384,896


Other Liability Data
Tax-exempt debt		$	28,495	$	—		$	28,495
Other notes payable			995,945		—			995,945
Other liabilities (9)			117,923		(2,179	)(9)		115,744
Total liabilities of unconsolidated real estate entities (10)			68,051		(44,233	)(10)		23,818

		$	1,210,414	$	(46,412	)	$	1,164,002


Other Data
Liquidation value of preferred shares			95,000		—			95,000
Common shares outstanding			43,440		—			43,440
Common units outstanding			705		—			705


(1)		The adjustments include additions for the Company’s 35% share of rental revenues ($1,015) and other property revenues ($73) and property operating and maintenance expenses (excluding depreciation and amortization) ($337) from Post Biltmore™ and Post Massachusetts Avenue™ (properties accounted for on the equity method of accounting). The adjustments include additions for rental revenues ($1,853) and other revenues ($179) and property operating and maintenance expenses ($877) from Post Oak™, Post Valley^®, and Post Summit^®, communities classified as held for sale and included in discontinued operations. In addition, the adjustments reflect a reduction of rental revenues ($410) and other revenues ($17) and property and operating maintenance expenses (excluding depreciation and amortization) ($500) generated by the Harbour Place City Homes™ and RISE™ units being converted to condominiums. The adjustments reflect a reduction for revenues ($1,512) and other revenues ($40) and property operating and maintenance expenses ($452) generated by Post Fallsgrove, a community acquired during the three months ended September 30, 2006. Also, the adjustments reflect a reduction of rental revenues ($2,586) and other revenues ($260) and property operating and maintenance expenses (excluding depreciation and amortization) ($2,365) relating to the Company’s corporate apartment business. Lastly, the adjustment to operating and maintenance expenses (excluding depreciation and amortization) also includes a reduction for corporate property management expenses ($3,732) and the impact of straight-lining long-term ground lease expense ($307).

(2)		Property NOI, as adjusted, includes net operating income of Post Chastain^® and Post Worthington™ which were being rehabilitated during the three months ended September 30, 2006. See page 17 for further information regarding rehabilitation activities and net operating income for these properties for the three months ended September 30, 2006.

(3)		The adjustment reflects a reduction for 1,031 units currently under construction at Post Carlyle™, Post Eastside™, Post Hyde Park^® and Post Alexander™, a reduction for 65% of the 545 units held in Post Biltmore™ and Post Massachusetts Avenue™ (two unconsolidated entities) (a 354 unit reduction) to adjust the units held in unconsolidated entities to the Company’s 35% share of the units and a reduction for 361 units relating to Post Fallsgrove that was acquired in the three months ended September 30, 2006.


(4)		The “As of September 30, 2006” amount represents the construction in progress balance per the Company’s balance sheet. The adjustment represents the aggregate cost investment in an acquisition property that was not included in operating results for the full third quarter of 2006 (Post Fallsgrove).

(5)		The adjustment reflects a reduction for the depreciated book value of Post Oak™, Post Valley^®, and Post Summit^®, communities held for sale and included in discontinued operations and an increase for its 35% share of the book value of its unconsolidated condominium conversion asset (Post Peachtree™). The “As Adjusted” amount represents the book value of its wholly-owned condo conversion assets (588™, Harbour Place City Homes™ and RISE™) and its 35% share of the book value of its unconsolidated condominium conversion asset (Post Peachtree™) and the book value of various land parcels held for sale.

(6)		The adjustment reflects a reduction for the investments in Post Biltmore™ and Post Massachusetts Avenue™ as the Company’s net operating income of such investments is included in the adjusted net operating income reflected above. The “As Adjusted” amount represents the Company’s investment in and advances to unconsolidated land entities.

(7)		These amounts consist of restricted cash and other assets, per the Company’s balance sheet.

(8)		The “As of September 30, 2006” amount represents cash and other assets of unconsolidated apartment and condominium conversion entities. The adjustment includes a reduction for the venture partners’ 65% share of cash and other assets ($3,744) of unconsolidated apartment and condominium conversion entities. The “As Adjusted” amount represents the Company’s 35% share of the cash and other assets of unconsolidated apartment and condominium conversion entities.

(9)		The “As of September 30, 2006” amount consists of the sum of accrued interest payable, dividends and distributions payable, accounts payable, and accrued expenses, security deposits and prepaid rents and minority interests in consolidated real estate entities as reflected on the Company’s balance sheet. The adjustment represents a reduction for the non-cash liability associated with straight-line, long-term ground lease expense.

(10)		The “As of September 30, 2006” amount represents total liabilities of unconsolidated apartment and condominium conversion entities. The adjustment represents a reduction for the venture partner’s 65% share of liabilities of unconsolidated apartment and condominium conversion entities. The “As Adjusted” amount represents the Company’s 35% share of liabilities of unconsolidated apartment and condominium conversion entities.

Computation of Implied Portfolio Capitalization Rate
(In thousands)


	Three months ended
Calculation of Adjusted Property Net Operating Income	September 30, 2006
Total rental and other revenues	$	75,120	(a)
Property operating & maintenance expenses (excluding depreciation and amortization)		29,648	(a)

Property net operating income		45,472
Adjustments to property net operating income
Assumed property management fee (calculated at 3% of revenues)		(2,254	)
Assumed property capital expenditure reserve ($300 per unit per year based on 20,493 units)		(1,537	)

Property net operating income, adjusted for assumed management fee and assumed capital expenditures	$	41,681

Property net operating income, adjusted for assumed management fee and assumed capital expenditures (annualized)(A)	$	166,724


	As of
Calculation of Implied Market Value of Company Gross Real Estate Assets	September 30, 2006
Implied market value of common shares and units	$	2,097,770	(b)
Other assets, as adjusted		(384,896	)(a)
Other liabilities, as adjusted		1,164,002	(a)
Preferred stock, at liquidation value		95,000	(a)

Implied market value of Company gross real estate assets(B)	$	2,971,876


Implied Portfolio Capitalization Rate, based on Company’s stock price as of September 30, 2006 (A÷B)		5.6	%


(a)		Represents amounts in the “as adjusted” column from the Financial Data table reflected above.

(b)		Calculated as follows:


Common shares and units outstanding at September 30, 2006		44,145
Per share market value of common stock at September 30, 2006	$	47.52

Implied market value of common shares and units at September 30, 2006	$	2,097,770

Post Properties, Inc.
Non-GAAP Financial Measures and Other Defined Terms
(Dollars in thousands, except per share or unit data)
(Unaudited)

Definitions of Supplemental Non-GAAP Financial Measures and Other Defined Terms

The Company uses certain non-GAAP financial measures and other defined terms in this accompanying Supplemental Financial Data. These non-GAAP financial measures include FFO, AFFO, net operating income, same store capital expenditures and certain debt statistics and ratios. The definitions of these non-GAAP financial measures are summarized below. The Company believes that these measures are helpful to investors in measuring financial performance and/or liquidity and comparing such performance and/or liquidity to other REITs.

Funds from Operations —The Company uses FFO as an operating measure. The Company uses the NAREIT definition of FFO. FFO is defined by NAREIT to mean net income (loss) available to common shareholders determined in accordance with GAAP, excluding gains (losses) from extraordinary items and sales of depreciable property, plus depreciation and amortization of real estate assets, and after adjustment for unconsolidated partnerships and joint ventures all determined on a consistent basis in accordance with GAAP. FFO presented in the Company’s press release and Supplemental Financial Data is not necessarily comparable to FFO presented by other real estate companies because not all real estate companies use the same definition. The Company’s FFO is comparable to the FFO of real estate companies that use the current NAREIT definition.

Accounting for real estate assets using historical cost accounting under GAAP assumes that the value of real estate assets diminishes predictably over time. NAREIT stated in its April 2002 White Paper on Funds from Operations that “since real estate asset values have historically risen or fallen with market conditions, many industry investors have considered presentations of operating results for real estate companies that use historical cost accounting to be insufficient by themselves.” As a result, the concept of FFO was created by NAREIT for the REIT industry to provide an alternate measure. Since the Company agrees with the concept of FFO and appreciates the reasons surrounding its creation, the Company believes that FFO is an important supplemental measure of operating performance. In addition, since most equity REITs provide FFO information to the investment community, the Company believes that FFO is a useful supplemental measure for comparing the Company’s results to those of other equity REITs. The Company believes that the line on its consolidated statement of operations entitled “net income (loss) available to common shareholders” is the most directly comparable GAAP measure to FFO.

Adjusted Funds From Operations —The Company also uses adjusted funds from operations (“AFFO”) as an operating measure. AFFO is defined as FFO less operating capital expenditures after adjusting for the non-cash impact of straight-line long-term ground lease expense, losses on early extinguishment of indebtedness and other income related to mark-to-market of an interest rate swap arrangement. The Company believes that AFFO is an important supplemental measure of operating performance for an equity REIT because it provides investors with an indication of the REIT’s ability to fund operating capital expenditures through earnings. In addition, since most equity REITs provide AFFO information to the investment community, the Company believes that AFFO is a useful supplemental measure for comparing the Company to other equity REITs. The Company believes that the line on its consolidated statement of operations entitled “net income (loss) available to common shareholders” is the most directly comparable GAAP measure to AFFO. Prior period amounts have been conformed to the current period presentation.

Property Net Operating Income —The Company uses property NOI, including same store NOI and same store NOI by market, as an operating measure. NOI is defined as rental and other revenues from real estate operations less total property and maintenance expenses from real estate operations (exclusive of depreciation and amortization). The Company believes that NOI is an important supplemental measure of operating performance for a REIT’s operating real estate because it provides a measure of the core operations, rather than factoring in depreciation and amortization, financing costs and general and administrative expenses generally incurred at the corporate level. This measure is particularly useful, in the opinion of the Company, in evaluating the performance of geographic operations, same store groupings and individual properties. Additionally, the Company believes that NOI, as defined, is a widely accepted measure of comparative operating performance in the real estate investment community. The Company believes that the line on its consolidated statement of operations entitled “net income” is the most directly comparable GAAP measure to NOI.

Same Store Capital Expenditures —The Company uses same store annually recurring and periodically recurring capital expenditures as cash flow measures. Same store annually recurring and periodically recurring capital expenditures are supplemental non-GAAP financial measures. The Company believes that same store annually recurring and periodically recurring capital expenditures are important indicators of the costs incurred by the Company in maintaining its same store communities on an ongoing basis. The corresponding GAAP measures include information with respect to the Company’s other operating segments consisting of communities stabilized in the prior year, lease-up communities, rehabilitation communities, sold properties and commercial properties in addition to same store information. Therefore, the Company believes that the Company’s presentation of same store annually recurring and periodically recurring capital expenditures is necessary to demonstrate same store replacement costs over time. The Company believes that the most directly comparable GAAP measure to same store annually recurring and periodically recurring capital expenditures are the lines on the Company’s consolidated statements of cash flows entitled “annually recurring capital expenditures” and “periodically recurring capital expenditures.”

Debt Statistics and Debt Ratios —The Company uses a number of debt statistics and ratios as supplemental measures of liquidity. The numerator and/or the denominator of certain of these statistics and/or ratios include non-GAAP financial measures that have been reconciled to the most directly comparable GAAP financial measure. These debt statistics and ratios include: (1) an interest coverage ratio; (2) a fixed charge coverage ratio; (3) total debt as a percentage of undepreciated real estate (adjusted for joint venture partner’s share of debt); (4) total debt plus preferred equity as a percentage of undepreciated real estate (adjusted for joint venture partner’s share of debt); (5) a ratio of consolidated debt to total assets; (6) a ratio of secured debt to total assets; (7) a ratio of total unencumbered assets to unsecured debt; and (8) a ratio of consolidated income available to debt service to annual debt service charge. A number of these debt statistics and ratios are derived from covenants found in the Company’s debt agreements, including, among others, the Company’s senior unsecured notes. In addition, the Company presents these measures because the degree of leverage could affect the Company’s ability to obtain additional financing for working capital, capital expenditures, acquisitions, development or other general corporate purposes. The Company uses these measures internally as an indicator of liquidity and the Company believes that these measures are also utilized by the investment and analyst communities to better understand the Company’s liquidity.

Average Economic Occupancy —The Company uses average economic occupancy as a statistical measure of operating performance. The Company defines average economic occupancy as gross potential rent less vacancy losses, model expenses and bad debt expenses divided by gross potential rent for the period, expressed as a percentage.

Reconciliations of Supplemental Non-GAAP Financial Measures

Table 1
Reconciliation of Same Store Net Operating Income (NOI) to GAAP Net Income
(Dollars in thousands)
(Unaudited)


	Three months ended									Nine months ended
	September 30,			September 30,			June 30,			September 30,			September 30,
	2006			2005			2006			2006			2005
Total same store NOI	$	39,377		$	37,392		$	38,839		$	116,044		$	109,295
Property NOI from other operating segments		1,658			1,425			1,591			4,257			2,353

Consolidated property NOI		41,035			38,817			40,430			120,301			111,648

Add (subtract):
Interest income		175			229			118			413			583
Other revenues		49			64			86			200			196
Minority interest in consolidated property partnerships		(85	)		34			(63	)		(177	)		212
Depreciation		(16,966	)		(17,496	)		(16,748	)		(50,101	)		(53,539	)
Interest expense		(13,609	)		(13,676	)		(13,256	)		(40,281	)		(42,722	)
Amortization of deferred financing costs		(882	)		(990	)		(833	)		(2,651	)		(3,707	)
General and administrative		(4,406	)		(4,558	)		(4,632	)		(13,464	)		(13,506	)
Investment, development and other expenses		(1,332	)		(1,333	)		(1,618	)		(4,500	)		(3,737	)
Gains (losses) on sales of condominiums, net		1,611			(99	)		8,569			10,022			(368	)
Equity in income of unconsolidated real estate entities		527			592			413			1,251			1,294
Other income		1,401			—			272			3,095			5,267
Minority interest of common unitholders		(87	)		10			(235	)		(369	)		226


Income from continuing operations		7,431			1,594			12,503			23,739			1,847
Income from discontinued operations		28,370			71,647			1,481			30,847			134,515


Net income	$	35,801		$	73,241		$	13,984		$	54,586		$	136,362

Table 2
Same Store Net Operating Income (NOI) Summary by Market
(Dollars in thousands)


	Three Months Ended						Q3 ’06			Q3 ’06			Q3 ’06
	September 30,		September 30,		June 30,		vs. Q3 ’05			vs. Q2 ’06			% Same
	2006		2005		2006		% Change			% Change			Store NOI
Rental and other revenues
Atlanta	$	26,616	$	25,480	$	25,861		4.5	%		2.9	%
Dallas		11,281		10,922		11,134		3.3	%		1.3	%
Tampa		7,019		6,496		6,897		8.1	%		1.8	%
Washington, D.C.		8,590		7,981		8,379		7.6	%		2.5	%
Charlotte		3,688		3,419		3,572		7.9	%		3.2	%
Houston		2,735		2,559		2,706		6.9	%		1.1	%
New York		3,426		3,143		3,328		9.0	%		2.9	%
Orlando		995		931		988		6.9	%		0.7	%

Total rental and other revenues		64,350		60,931		62,865		5.6	%		2.4	%


Property operating and maintenance expenses (exclusive of depreciation and amortization)
Atlanta		10,399		9,253		9,924		12.4	%		4.8	%
Dallas		5,298		4,959		4,993		6.8	%		6.1	%
Tampa		2,690		2,595		2,543		3.7	%		5.8	%
Washington, D.C.		2,840		2,635		2,792		7.8	%		1.7	%
Charlotte		1,139		1,141		1,182		(0.2	)%		(3.6	)%
Houston		1,328		1,723		1,313		(22.9	)%		1.1	%
New York		874		875		887		(0.1	)%		(1.5	)%
Orlando		405		358		392		13.1	%		3.3	%

Total		24,973		23,539		24,026		6.1	%		3.9	%


Net operating income
Atlanta		16,217		16,227		15,937		(0.1	)%		1.8	%		41.2	%
Dallas		5,983		5,963		6,141		0.3	%		(2.6	)%		15.2	%
Tampa		4,329		3,901		4,354		11.0	%		(0.6	)%		11.0	%
Washington, D.C.		5,750		5,346		5,587		7.6	%		2.9	%		14.6	%
Charlotte		2,549		2,278		2,390		11.9	%		6.7	%		6.4	%
Houston		1,407		836		1,393		68.3	%		1.0	%		3.6	%
New York		2,552		2,268		2,441		12.5	%		4.5	%		6.5	%
Orlando		590		573		596		3.0	%		(1.0	)%		1.5	%

Total same store NOI	$	39,377	$	37,392	$	38,839		5.3	%		1.4	%		100.0	%

Table 2 (con’t)
Same Store Net Operating Income (NOI) Summary by Market
(Dollars in thousands)


	Nine months ended
	September 30,		September 30,
	2006		2005		% Change
Rental and other revenues
Atlanta	$	77,719	$	75,104		3.5	%
Dallas		33,242		31,790		4.6	%
Tampa		20,733		19,082		8.7	%
Washington, D.C.		25,078		23,543		6.5	%
Charlotte		10,720		9,900		8.3	%
Houston		8,100		7,379		9.8	%
New York		10,000		9,139		9.4	%
Orlando		2,973		2,724		9.1	%

Total rental and other revenues		188,565		178,661		5.5	%


Property operating and maintenance expenses (exclusive of depreciation and amortization)
Atlanta		29,716		27,755		7.1	%
Dallas		15,215		14,354		6.0	%
Tampa		7,745		7,664		1.1	%
Washington, D.C.		8,414		8,135		3.4	%
Charlotte		3,410		3,246		5.1	%
Houston		3,927		4,310		(8.9	)%
New York		2,891		2,753		5.0	%
Orlando		1,203		1,149		4.7	%

Total		72,521		69,366		4.5	%


Net operating income
Atlanta		48,003		47,349		1.4	%
Dallas		18,027		17,436		3.4	%
Tampa		12,988		11,418		13.8	%
Washington, D.C.		16,664		15,408		8.2	%
Charlotte		7,310		6,654		9.9	%
Houston		4,173		3,069		36.0	%
New York		7,109		6,386		11.3	%
Orlando		1,770		1,575		12.4	%

Total same store NOI	$	116,044	$	109,295		6.2	%

Table 3
Reconciliation of Segment Cash Flow Data to Statements of Cash Flows
(Dollars in thousands)


	Three months ended				Nine months ended
	September 30,				September 30,
	2006		2005		2006		2005
Annually recurring capital expenditures by operating segment Same store	$	2,869	$	1,909	$	7,953	$	5,433
Construction and lease-up		21		76		374		347
Condominium conversion communities		2		54		2		107
Acquired		131		21		190		36
Other segments		206		290		624		1,249

Total annually recurring capital expenditures per statements of cash flows	$	3,229	$	2,350	$	9,143	$	7,172


Periodically recurring capital expenditures by operating segment Same store	$	600	$	451	$	1,851	$	1,504
Construction and lease-up		212		57		424		293
Condominium conversion communities		—		22		—		58
Acquired		3		—		12		5
Other segments		1,309		77		2,159		776

Total periodically recurring capital expenditures per statements of cash flows	$	2,124	$	607	$	4,446	$	2,636

Table 4
Computation of Interest and Fixed Charge Coverage Ratios
(Dollars in thousands)


	Nine months ended
	September 30,
	2006			2005
Income from continuing operations	$	23,739		$	1,847

Minority interest of common unitholders		369			(226	)
Other income		(3,095	)		(5,267	)
Losses (gains) on sales of condominiums, net		(10,022	)		368
Gains on sales of real estate assets – unconsolidated entities		(247	)		(445	)
Depreciation expense		50,101			53,539
Depreciation (company share) of assets held in unconsolidated entities		679			744
Interest expense		40,281			42,722
Interest expense (company share) of assets held in unconsolidated entities		745			895
Amortization of deferred financing costs		2,651			3,707


Income available for debt service(A)	$	105,201		$	97,884


Interest expense	$	40,281		$	42,722
Interest expense (company share) of assets held in unconsolidated entities		745			895

Interest expense for purposes of computation(B)		41,026			43,617
Dividends and distributions to preferred shareholders and unitholders		5,728			5,728

Fixed charges for purposes of computation(C)	$	46,754		$	49,345


Interest coverage ratio(A÷B)		2.6x			2.2x


Fixed charge coverage ratio(A÷C)		2.3x			2.0x

Table 5
Computation of Debt Ratios
(Dollars in thousands)


	As of September 30,
	2006			2005
Total real estate assets per balance sheet	$	1,998,044		$	1,901,826
Plus:
Company share of real estate assets held in unconsolidated entities		42,442			41,236
Company share of accumulated depreciation – assets held in unconsolidated entities		3,601			2,698
Accumulated depreciation per balance sheet		530,090			508,386
Accumulated depreciation on assets held for sale		19,004			—

Total undepreciated real estate assets(A)	$	2,593,181		$	2,454,146


Total debt per balance sheet	$	1,024,440		$	957,985
Plus:
Company share of third party debt held in unconsolidated entities		23,449			23,450
Less:
Joint venture partners’ share of mortgage debt of the company		(8,550	)		(6,679	)

Total debt (adjusted for joint venture partners’ share of debt)(B)	$	1,039,339		$	974,756


Total debt as a % of undepreciated real estate assets (adjusted for joint venture partners’ share of debt)(B÷A)		40.1	%		39.7	%


Total debt per balance sheet	$	1,024,440		$	957,985
Plus:
Company share of third party debt held in unconsolidated entities		23,449			23,450
Preferred shares at liquidation value		95,000			95,000
Less:
Joint venture partners’ share of mortgage debt of the company		(8,550	)		(6,679	)

Total debt and preferred equity (adjusted for joint venture partner’s share of debt)(C)	$	1,134,339		$	1,069,756


Total debt and preferred equity as a % of undepreciated assets (adjusted for joint venture partners’ share of debt)(C÷A)		43.7	%		43.6	%

Table 6
Calculation of Company Undepreciated Book Value Per Share
(Dollars in thousands)


	September 30,
	2006
Total shareholders’ equity, per balance sheet	$	934,060
Plus:
Accumulated depreciation, per balance sheet		530,090
Accumulated depreciation held for sale assets, per balance sheet		19,004
Minority interest of common unitholders in Operating Partnership, per balance sheet		13,691
Less:
Deferred charges, net, per balance sheet		(13,311	)
Preferred shares at liquidation value		(95,000	)

Total undepreciated book value(A)	$	1,388,534


Total common shares and units(B)		44,145


Company undepreciated book value per share(A÷B)	$	31.45

Post Apartment Homes Inactive 8-KResults of Operations and Financial Condition