Equity Residential (EQR) 8-K Equity Residential Reports Fourth Quarter 2010 Results

Exhibit 99.1

Equity Residential Reports Fourth Quarter 2010 Results

Same Store Revenues Increase 2.7% for the quarter;Provides Outlook for 2011 Performance

CHICAGO--(BUSINESS WIRE)--February 2, 2011--Equity Residential (NYSE: EQR) today reported results for the quarter and year ended December 31, 2010. All per share results are reported on a fully-diluted basis.

"We are very pleased that strengthening apartment fundamentals and outstanding execution on pricing and expense controls combined to produce terrific same store operating results in the fourth quarter," said David J. Neithercut, Equity Residential’s President and CEO. "We begin the new year with 95% occupancy, little new supply and an improving economy that will produce growing demand for high quality, well located rental housing. As a result, we are well positioned to deliver strong growth in operating income and earnings in 2011."

Fourth Quarter 2010

For the fourth quarter of 2010, the company reported earnings of $0.65 per share compared to $0.15 per share in the fourth quarter of 2009. The difference is due primarily to higher gains from property sales in 2010 partially offset by a non-cash impairment charge of approximately $45.4 million, or $0.15 per share, on the value of two land parcels that the company had previously intended to develop. The company now intends to sell one parcel in the near term and contemplates a joint venture structure for the other, necessitating this impairment charge. The impairment charge is the difference between each parcel’s estimated fair value and current capitalized carrying value.

FFO (funds from operations) for the quarter ended December 31, 2010, excluding the impairment charge, was $0.60 per share compared to $0.43 per share in the fourth quarter of 2009. The difference is primarily due to:

• A positive impact of approximately $0.11 per share from higher total property net operating income (NOI) in the fourth quarter of 2010, which is comprised of higher same store NOI of approximately $0.05 per share; higher NOI of approximately $0.04 per share from 2009 and 2010 transaction activity and a contribution from lease up activity of approximately $0.02 per share; and
• A positive impact of approximately $0.07 per share primarily from lower debt extinguishment costs in the fourth quarter of 2010, due to the company’s debt tender activity in the fourth quarter of 2009.

In order to more accurately reflect the company’s operating performance, the company will now report FFO as adjusted for certain non-comparable items, or Normalized FFO. Normalized FFO will begin with FFO and eliminate certain items that by their nature are not comparable from period to period or that tend to obscure the company’s actual operating performance. A reconciliation and definition of Normalized FFO are provided on pages 6 and 26 of this release and the company has included guidance for Normalized FFO on page 25 of this release. Going forward, the company plans to report and provide guidance primarily for Normalized FFO.

Normalized FFO for the fourth quarter of 2010 was $0.61 per share compared to $0.54 per share for the same period of 2009. The difference is due primarily to:

• A positive impact of approximately $0.11 per share from higher total property NOI in the fourth quarter of 2010, as described above;
• A negative impact of approximately $0.01 per share from higher debt costs, excluding debt extinguishment costs;
• A negative impact of approximately $0.01 per share from the expenses and lost revenues relating to the Prospect Towers garage; and
• A negative impact of approximately $0.02 per share from various other items, including equity issuances under the company's At-The-Market (ATM) share program.

Year Ended December 31, 2010

For the year ended December 31, 2010, the company reported earnings of $0.95 per share compared to $1.27 per share in the same period of 2009.

FFO for the years ended December 31, 2010 and 2009, excluding impairment charges, was $2.22 per share and $2.16 per share, respectively.

Normalized FFO for the year ended December 31, 2010 was $2.27 per share compared to $2.28 per share for the same period of 2009.

Same Store Results

On a same store fourth quarter to fourth quarter comparison, which includes 113,931 apartment units, revenues increased 2.7%, expenses decreased 1.8% and NOI increased 5.4%.

On a same store sequential third quarter to fourth quarter comparison, which includes 118,284 apartment units, revenues were flat, expenses decreased 5.5% and NOI increased 3.4%.

On a same store year over year comparison, which includes 112,042 apartment units, revenues decreased 0.1%, expenses increased 0.9% and NOI decreased 0.8%.

Acquisitions/Dispositions

During the fourth quarter of 2010, the company acquired two properties with a total of 281 apartment units for an aggregate purchase price of $87.5 million at a weighted average capitalization (cap) rate of 4.8%. Also during the quarter, the company acquired two land parcels for an aggregate purchase price of $14.6 million.

During the quarter, the company sold 24 consolidated properties, consisting of 4,734 apartment units, for an aggregate sale price of $546.4 million at a weighted average cap rate of 6.5% generating an unlevered internal rate of return (IRR), inclusive of management costs, of 10.3%.

During 2010, the company acquired 16 properties, consisting of 4,445 apartment units, for an aggregate purchase price of $1.5 billion. Included in this total are the acquisitions of 425 Mass in Washington, D.C. and Vantage Pointe in San Diego, both of which are currently in lease up. The weighted average cap rate on the company’s acquisitions in 2010, not including 425 Mass and Vantage Pointe, was 5.4%.

During 2010, the company sold 35 consolidated properties, consisting of 7,171 apartment units, for an aggregate sale price of $718.4 million at a weighted average cap rate of 6.7% generating an unlevered IRR, inclusive of management costs, of 10.0%.

New Dividend Policy

On December 9, 2010, the company announced its new dividend policy which will generate payouts closely aligned with the actual annual operating results of the company’s core business and provide more transparency to investors. Pursuant to this policy, the company intends to pay an annual cash dividend equal to approximately 65% of Normalized FFO. The company intends to pay $0.3375 per share for each of the first three quarters of the year. For the fourth quarter, the company intends to pay a dividend that will bring the total payment for the year to approximately 65% of Normalized FFO. Based on the company’s 2011 Normalized FFO guidance range, the expected dividend payout for 2011 would be $1.56 to $1.62 per share. All future dividends remain subject to the discretion of the company’s Board of Trustees.

At-The-Market (ATM) Share Offering Program

During the fourth quarter of 2010, the company issued approximately 5.1 million common shares at an average price of $50.27 per share for total consideration of approximately $256.1 million. During the first quarter of 2011, the company has issued approximately 3.0 million common shares at an average price of $50.84 per share for total consideration of approximately $154.5 million. The company will use the proceeds from these share sales primarily to fund its investment activity, including development, and to fund debt repayment. The company’s Board of Trustees has authorized an increase in the amount of shares available for future issuance under this program by approximately 5.7 million to bring the total available for future issuance to 10 million shares.

First Quarter and Full Year 2011 Guidance

The company has established a Normalized FFO guidance range of $0.53 to $0.57 per share for the first quarter of 2011. The difference between the company’s fourth quarter 2010 Normalized FFO of $0.61 per share and the midpoint of the first quarter guidance range of $0.55 per share is primarily due to:

• A negative impact of approximately $0.02 per share from lower same store property NOI as a result of seasonal increases in expenses;
• A negative impact of approximately $0.01 per share from lower non-same store property NOI;
• A negative impact of approximately $0.02 per share due to the amount and timing of 2010 and 2011 transaction activity; and
• A negative impact of approximately $0.01 per share from ATM activity.

The company has established a Normalized FFO guidance range of $2.40 to $2.50 per share for the full year 2011. The assumptions underlying this guidance can be found on page 25 of this release. The difference between the company’s full-year 2010 Normalized FFO of $2.27 per share and the midpoint of the company’s guidance range of $2.45 per share for full year 2011 Normalized FFO is primarily due to:

• A positive impact of approximately $0.24 per share from higher same store property NOI;
• A positive impact of approximately $0.13 per share from higher non-same store property NOI including lease ups;
• A negative impact of approximately $0.10 per share due to the amount and timing of 2010 and 2011 transaction activity;
• A negative impact of approximately $0.04 per share from ATM activity; and
• A negative impact of approximately $0.05 per share primarily from $0.03 per share of higher interest expense.

First Quarter 2011 Conference Call

Equity Residential expects to announce first quarter 2011 results on Wednesday, April 27, 2011 and host a conference call to discuss those results at 10:00 a.m. CT on Thursday, April 28, 2011.

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 451 properties located in 17 states and the District of Columbia, consisting of 129,604 apartment units. For more information on Equity Residential, please visit our website at www.equityapartments.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.equityapartments.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 will take place tomorrow, Thursday, February 3, at 10:00 a.m. Central. Please visit the Investor Information section of the company’s web site at www.equityapartments.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)
			Year Ended December 31,						Quarter Ended December 31,
				2010			2009			2010			2009
REVENUES
	Rental income		$	1,986,043		$	1,846,157		$	515,244		$	458,856
	Fee and asset management			9,476			10,346			1,880			2,418
		Total revenues		1,995,519			1,856,503			517,124			461,274
EXPENSES
	Property and maintenance			498,634			464,809			123,981			113,140
	Real estate taxes and insurance			226,718			206,247			55,731			52,931
	Property management			81,126			71,938			20,578			15,481
	Fee and asset management			5,140			7,519			776			1,603
	Depreciation			656,633			559,271			168,500			142,647
	General and administrative			39,887			38,994			8,853			8,518
	Impairment			45,380			11,124			45,380			-
		Total expenses		1,553,518			1,359,902			423,799			334,320
Operating income				442,001			496,601			93,325			126,954
	Interest and other income			5,469			16,585			259			826
	Other expenses			(11,928	)		(6,487	)		(2,415	)		(4,259	)
	Interest:
		Expense incurred, net		(470,654	)		(496,272	)		(120,718	)		(140,611	)
		Amortization of deferred financing costs		(10,369	)		(12,566	)		(2,411	)		(3,471	)
(Loss) before income and other taxes, (loss) from investments
	in unconsolidated entities, net gain (loss) on sales of unconsolidated entities
	and land parcels and discontinued operations			(45,481	)		(2,139	)		(31,960	)		(20,561	)
Income and other tax (expense) benefit				(334	)		(2,804	)		(27	)		37
(Loss) from investments in unconsolidated entities				(735	)		(2,815	)		-			(443	)
Net gain on sales of unconsolidated entities				28,101			10,689			-			3,971
Net (loss) on sales of land parcels				(1,395	)		-			(234	)		-
(Loss) income from continuing operations				(19,844	)		2,931			(32,221	)		(16,996	)
Discontinued operations, net				315,827			379,098			230,433			64,307
Net income				295,983			382,029			198,212			47,311
Net (income) loss attributable to Noncontrolling Interests:
	Operating Partnership			(13,099	)		(20,305	)		(8,932	)		(2,186	)
	Preference Interests and Units			-			(9	)		-			-
	Partially Owned Properties			726			558			103			167
Net income attributable to controlling interests				283,610			362,273			189,383			45,292
Preferred distributions				(14,368	)		(14,479	)		(3,513	)		(3,620	)
Net income available to Common Shares			$	269,242		$	347,794		$	185,870		$	41,672
Earnings per share – basic:
(Loss) from continuing operations available to Common Shares			$	(0.11	)	$	(0.04	)	$	(0.12	)	$	(0.07	)
Net income available to Common Shares			$	0.95		$	1.27		$	0.65		$	0.15
Weighted average Common Shares outstanding				282,888			273,609			285,916			275,519
Earnings per share – diluted:
(Loss) from continuing operations available to Common Shares			$	(0.11	)	$	(0.04	)	$	(0.12	)	$	(0.07	)
Net income available to Common Shares			$	0.95		$	1.27		$	0.65		$	0.15
Weighted average Common Shares outstanding				282,888			273,609			285,916			275,519
Distributions declared per Common Share outstanding			$	1.47		$	1.64		$	0.4575		$	0.3375

Equity Residential
Consolidated Statements of Funds From Operations and Normalized Funds From Operations
(Amounts in thousands except per share data)
(Unaudited)
			Year Ended December 31,						Quarter Ended December 31,
				2010			2009			2010			2009
Net income			$	295,983		$	382,029		$	198,212		$	47,311
Adjustments:
	Net (income) loss attributable to Noncontrolling Interests:
		Preference Interests and Units		-			(9	)		-			-
		Partially Owned Properties		726			558			103			167
	Depreciation			656,633			559,271			168,500			142,647
	Depreciation – Non-real estate additions			(6,788	)		(7,355	)		(1,779	)		(1,786	)
	Depreciation – Partially Owned and Unconsolidated Properties			(1,619	)		759			(770	)		103
	Net (gain) on sales of unconsolidated entities			(28,101	)		(10,689	)		-			(3,971	)
	Discontinued operations:
		Depreciation		16,770			41,104			3,208			6,241
		Net (gain) on sales of discontinued operations		(297,956	)		(335,299	)		(228,418	)		(60,366	)
		Net incremental gain (loss) on sales of condominium units		1,506			(385	)		887			65
FFO (1) (3)				637,154			629,984			139,943			130,411
Adjustments (see page 24 for additional detail):
	Asset impairment and valuation allowances			45,380			11,124			45,380			-
	Property acquisition costs and write-off of pursuit costs (other expenses)			11,928			6,488			2,415			4,260
	Debt extinguishment (gains) losses, including prepayment penalties, preferred
		share redemptions and non-cash convertible debt discounts		8,594			34,333			1,921			26,727
	(Gains) losses on sales of non-operating assets, net of income and other
		tax expense (benefit)		(80	)		(5,737	)		(657	)		(1,311	)
	Other miscellaneous non-comparable items			(6,186	)		(171	)		(994	)		-
Normalized FFO (2) (3)			$	696,790		$	676,021		$	188,008		$	160,087
FFO (1) (3)			$	637,154		$	629,984		$	139,943		$	130,411
Preferred distributions				(14,368	)		(14,479	)		(3,513	)		(3,620	)
FFO available to Common Shares and Units - basic (1) (3) (4)			$	622,786		$	615,505		$	136,430		$	126,791
FFO available to Common Shares and Units - diluted (1) (3) (4)			$	623,288		$	616,128		$	136,474		$	126,945
FFO per share and Unit - basic			$	2.10		$	2.13		$	0.46		$	0.44
FFO per share and Unit - diluted			$	2.07		$	2.12		$	0.45		$	0.43
Normalized FFO (2) (3)			$	696,790		$	676,021		$	188,008		$	160,087
Preferred distributions				(14,368	)		(14,479	)		(3,513	)		(3,620	)
Normalized FFO available to Common Shares and Units - basic (2) (3) (4)			$	682,422		$	661,542		$	184,495		$	156,467
Normalized FFO available to Common Shares and Units - diluted (2) (3) (4)			$	682,924		$	662,165		$	184,539		$	156,621
Normalized FFO per share and Unit - basic			$	2.30		$	2.29		$	0.62		$	0.54
Normalized FFO per share and Unit - diluted			$	2.27		$	2.28		$	0.61		$	0.54
Weighted average Common Shares and Units outstanding - basic				296,527			289,167			299,363			289,693
Weighted average Common Shares and Units outstanding - diluted				300,615			290,508			303,942			291,984
Note:		See page 24 for additional detail regarding the adjustments from FFO to Normalized FFO. See page 26 for the definitions, the footnotes referenced above and the reconciliations of EPS to FFO and Normalized FFO.

Equity Residential
Consolidated Balance Sheets
(Amounts in thousands except for share amounts)
(Unaudited)
				December 31,			December 31,
					2010			2009
ASSETS
Investment in real estate
	Land			$	4,110,275		$	3,650,324
	Depreciable property				15,226,512			13,893,521
	Projects under development				130,337			668,979
	Land held for development				235,247			252,320
Investment in real estate					19,702,371			18,465,144
	Accumulated depreciation				(4,337,357	)		(3,877,564	)
Investment in real estate, net					15,365,014			14,587,580
Cash and cash equivalents					431,408			193,288
Investments in unconsolidated entities					3,167			6,995
Deposits – restricted					180,987			352,008
Escrow deposits – mortgage					12,593			17,292
Deferred financing costs, net					42,033			46,396
Other assets					148,992			213,956
			Total assets	$	16,184,194		$	15,417,515
LIABILITIES AND EQUITY
Liabilities:
	Mortgage notes payable			$	4,762,896		$	4,783,446
	Notes, net				5,185,180			4,609,124
	Lines of credit				-			-
	Accounts payable and accrued expenses				39,452			58,537
	Accrued interest payable				98,631			101,849
	Other liabilities				304,202			272,236
	Security deposits				60,812			59,264
	Distributions payable				140,905			100,266
			Total liabilities		10,592,078			9,984,722
Commitments and contingencies
Redeemable Noncontrolling Interests – Operating Partnership					383,540			258,280
Equity:
	Shareholders' equity:
		Preferred Shares of beneficial interest, $0.01 par value;
			100,000,000 shares authorized; 1,600,000 shares issued
			and outstanding as of December 31, 2010 and 1,950,925
			shares issued and outstanding as of December 31, 2009		200,000			208,773
		Common Shares of beneficial interest, $0.01 par value;
			1,000,000,000 shares authorized; 290,197,242 shares issued
			and outstanding as of December 31, 2010 and 279,959,048
			shares issued and outstanding as of December 31, 2009		2,902			2,800
		Paid in capital			4,741,521			4,477,426
		Retained earnings			203,581			353,659
		Accumulated other comprehensive (loss) income			(57,818	)		4,681
			Total shareholders' equity		5,090,186			5,047,339
	Noncontrolling Interests:
		Operating Partnership			110,399			116,120
		Partially Owned Properties			7,991			11,054
			Total Noncontrolling Interests		118,390			127,174
			Total equity		5,208,576			5,174,513
			Total liabilities and equity	$	16,184,194		$	15,417,515

Equity Residential
Portfolio Summary
As of December 31, 2010
					% of	Average
				% of	Stabilized	Rental
	Markets	Properties	Units	Total Units	NOI	Rate (1)
1	New York Metro Area	28	8,290	6.4%	12.7%	$ 2,843
2	DC Northern Virginia	31	10,393	8.0%	12.1%	1,869
3	South Florida	38	12,869	9.9%	9.1%	1,313
4	Los Angeles	39	8,311	6.4%	8.1%	1,717
5	Boston	28	5,711	4.4%	7.1%	2,204
6	Seattle/Tacoma	43	9,748	7.5%	6.7%	1,293
7	San Francisco Bay Area	35	6,606	5.1%	6.0%	1,683
8	San Diego	14	4,963	3.8%	5.2%	1,789
9	Phoenix	36	10,769	8.3%	4.8%	848
10	Denver	23	7,967	6.2%	4.7%	1,044
11	Suburban Maryland	21	5,782	4.5%	4.5%	1,346
12	Orlando	26	8,042	6.2%	4.2%	961
13	Orange County, CA	11	3,490	2.7%	3.2%	1,518
14	Atlanta	20	6,183	4.8%	3.0%	961
15	Inland Empire, CA	11	3,639	2.8%	2.8%	1,352
16	All Other Markets (2)	45	12,103	9.3%	5.8%	975
	Total	449	124,866	96.3%	100.0%	1,444
	Military Housing	2	4,738	3.7%	-	-
	Grand Total	451	129,604	100.0%	100.0%	$ 1,444
(1) Average rental rate is defined as total rental revenues divided by the weighted average occupied units for the month of December 2010.
(2) All Other Markets - Each individual market is less than 2.0% of stabilized NOI.
Note: Projects under development are not included in the Portfolio Summary until construction has been completed, at which time the projects are included at their stabilized NOI.

Equity Residential
Portfolio as of December 31, 2010
			Properties	Units
	Wholly Owned Properties		425	119,634
	Partially Owned Properties:
		Consolidated	24	5,232
		Unconsolidated	-	-
	Military Housing		2	4,738
			451	129,604

Portfolio Rollforward Q4 2010
($ in thousands)
								Purchase/
				Properties		Units		(Sale) Price			Cap Rate
			9/30/2010	471		133,029
Acquisitions:
	Rental Properties:
		Consolidated - Stabilized		2		281		$	87,450		4.8	%
	Land Parcels (two)			-		-		$	14,569
Dispositions:
	Rental Properties:
		Consolidated		(24	)	(4,734	)	$	(546,362	)	6.5	%
Completed Developments				2		970
Configuration Changes				-		58
			12/31/2010	451		129,604

Portfolio Rollforward 2010
($ in thousands)
										Purchase/
					Properties		Units			(Sale) Price			Cap Rate
				12/31/2009	495		137,007
Acquisitions:
		Rental Properties:
			Consolidated - Stabilized		14		3,207			$	1,118,951		5.4	%
			Consolidated - Not Stabilized (1)		2		1,238			$	366,750
		Land Parcels (six)			-		-			$	68,869
Dispositions:
		Rental Properties:
			Consolidated		(35	)	(7,171	)		$	(718,352	)	6.7	%
			Unconsolidated (2)		(27	)	(6,275	)		$	(417,779	)	7.5	%
		Land Parcel (one)			-		-			$	(4,000	)
		Condominium Conversion Properties			(1	)	(2	)		$	(360	)
Completed Developments					3		1,450
Configuration Changes					-		150
				12/31/2010	451		129,604		(3)
(1	)	EQR acquired one property in the third quarter of 2010 (Vantage Pointe) that was in the early stages of lease up and is expected to stabilize in its third year of ownership at a 7.0% yield on cost. EQR also acquired one unoccupied property in the second quarter of 2010 (425 Mass) that is expected to stabilize in its third year of ownership at an 8.5% yield on cost.
(2	)	EQR owned a 25% interest in these unconsolidated rental properties. Sale price listed is the gross sale price.
(3	)	During the second quarter of 2010, EQR acquired the 75% equity interest it did not own in seven previously unconsolidated properties containing 1,811 units with a real estate value of $105.1 million at an implied cap rate of 8.4%. One of these properties was subsequently sold while the remaining properties continue to be included in the Company's portfolio counts above.

Equity Residential
Fourth Quarter 2010 vs. Fourth Quarter 2009
Same Store Results/Statistics
$ in thousands (except for Average Rental Rate) - 113,931 Same Store Units
			Results									Statistics
												Average
												Rental
Description			Revenues			Expenses			NOI (1)			Rate (2)			Occupancy		Turnover
Q4 2010			$	444,460		$	160,085		$	284,375		$	1,376		94.6	%	12.8	%
Q4 2009			$	432,896		$	162,999		$	269,897		$	1,351		93.9	%	14.1	%
Change			$	11,564		$	(2,914	)	$	14,478		$	25		0.7	%	(1.3	%)
Change				2.7	%		(1.8	%)		5.4	%		1.9	%
Fourth Quarter 2010 vs. Third Quarter 2010
Same Store Results/Statistics
$ in thousands (except for Average Rental Rate) - 118,284 Same Store Units
			Results									Statistics
												Average
												Rental
Description			Revenues			Expenses			NOI (1)			Rate (2)			Occupancy		Turnover
Q4 2010			$	470,444		$	170,488		$	299,956		$	1,403		94.6	%	12.8	%
Q3 2010			$	470,667		$	180,483		$	290,184		$	1,399		94.9	%	17.7	%
Change			$	(223	)	$	(9,995	)	$	9,772		$	4		(0.3	%)	(4.9	%)
Change				(0.0	%)		(5.5	%)		3.4	%		0.3	%
2010 vs. 2009
Same Store Results/Statistics
$ in thousands (except for Average Rental Rate) - 112,042 Same Store Units
			Results									Statistics
												Average
												Rental
Description			Revenues			Expenses			NOI (1)			Rate (2)			Occupancy		Turnover
2010			$	1,728,268		$	654,663		$	1,073,605		$	1,358		94.8	%	56.7	%
2009			$	1,730,335		$	648,508		$	1,081,827		$	1,375		93.7	%	61.5	%
Change			$	(2,067	)	$	6,155		$	(8,222	)	$	(17	)	1.1	%	(4.8	%)
Change				(0.1	%)		0.9	%		(0.8	%)		(1.2	%)
(1	)	The Company's primary financial measure for evaluating each of its apartment communities is net operating income ("NOI"). NOI represents rental income less property and maintenance expense, real estate tax and insurance expense and property management expense. The Company believes that NOI is helpful to investors as a supplemental measure of its operating performance because it is a direct measure of the actual operating results of the Company's apartment communities. See page 26 for reconciliations from operating income.
(2	)	Average rental rate is defined as total rental revenues divided by the weighted average occupied units for the period.

Equity Residential
Fourth Quarter 2010 vs. Fourth Quarter 2009
Same Store Results/Statistics by Market
										Increase (Decrease) from Prior Year's Quarter
					Q4 2010		Q4 2010	Q4 2010
					% of		Average	Weighted								Average
					Actual		Rental	Average								Rental
			Markets	Units	NOI		Rate (1)	Occupancy %		Revenues		Expenses		NOI		Rate (1)		Occupancy
1			DC Northern Virginia	8,781	10.5	%	$ 1,701	95.3	%	5.4	%	(2.1	%)	8.9	%	4.4	%	0.9	%
2			South Florida	12,465	10.0	%	1,300	94.1	%	3.0	%	(6.0	%)	9.3	%	2.5	%	0.5	%
3			New York Metro Area	5,887	9.4	%	2,652	95.0	%	3.0	%	1.3	%	4.1	%	3.7	%	(0.7	%)
4			Los Angeles	7,463	8.5	%	1,699	94.9	%	1.9	%	(7.1	%)	7.0	%	0.9	%	0.8	%
5			Boston	5,521	7.8	%	2,162	95.7	%	3.5	%	0.1	%	5.4	%	2.5	%	0.8	%
6			Seattle/Tacoma	8,540	6.8	%	1,315	93.1	%	3.6	%	2.0	%	4.6	%	1.3	%	2.0	%
7			San Francisco Bay Area	5,924	6.5	%	1,673	94.7	%	1.5	%	(1.0	%)	2.8	%	0.9	%	0.5	%
8			Denver	7,759	5.5	%	1,052	95.0	%	4.7	%	(1.3	%)	7.8	%	3.5	%	1.0	%
9			Phoenix	10,769	5.5	%	844	94.5	%	2.4	%	4.8	%	5.2	%	(0.1	%)	2.3	%
10			Orlando	8,042	4.8	%	970	94.1	%	0.2	%	(3.3	%)	2.4	%	0.0	%	0.2	%
11			San Diego	4,103	4.7	%	1,666	94.9	%	0.9	%	(1.9	%)	2.3	%	1.4	%	(0.4	%)
12			Suburban Maryland	5,083	4.1	%	1,270	94.6	%	4.1	%	3.7	%	4.4	%	3.8	%	0.3	%
13			Orange County, CA	3,175	3.3	%	1,514	94.8	%	0.3	%	(5.0	%)	2.9	%	0.2	%	0.2	%
14			Atlanta	5,979	3.3	%	962	95.7	%	1.4	%	0.9	%	1.8	%	0.7	%	0.6	%
15			Inland Empire, CA	3,339	3.1	%	1,359	94.9	%	0.8	%	(3.7	%)	3.1	%	0.7	%	0.1	%
16			All Other Markets	11,101	6.2	%	961	94.5	%	1.8	%	(1.7	%)	4.5	%	1.2	%	0.6	%
			Total	113,931	100.0	%	$ 1,376	94.6	%	2.7	%	(1.8	%)	5.4	%	1.9	%	0.7	%
(1	)	Average rental rate is defined as total rental revenues divided by the weighted average occupied units for the period.

Equity Residential
Fourth Quarter 2010 vs. Third Quarter 2010
Same Store Results/Statistics by Market
										Increase (Decrease) from Prior Quarter
					Q4 2010		Q4 2010	Q4 2010
					% of		Average	Weighted								Average
					Actual		Rental	Average								Rental
			Markets	Units	NOI		Rate (1)	Occupancy %		Revenues		Expenses		NOI		Rate (1)		Occupancy
1			DC Northern Virginia	9,327	11.0	%	$ 1,757	95.3	%	(0.3	%)	(5.7	%)	2.2	%	0.8	%	(1.1	%)
2			New York Metro Area	6,797	10.9	%	2,905	95.2	%	0.0	%	3.1	%	(2.1	%)	1.4	%	(1.3	%)
3			South Florida	12,465	9.5	%	1,301	94.0	%	(0.5	%)	(6.9	%)	3.8	%	(0.2	%)	(0.2	%)
4			Los Angeles	7,646	8.2	%	1,699	94.9	%	(0.4	%)	(6.8	%)	3.2	%	(0.5	%)	0.1	%
5			Boston	5,521	7.4	%	2,162	95.7	%	1.3	%	(6.6	%)	6.1	%	1.6	%	(0.3	%)
6			Seattle/Tacoma	9,427	7.1	%	1,306	93.1	%	(0.3	%)	(6.0	%)	3.5	%	(0.7	%)	0.3	%
7			San Francisco Bay Area	5,924	6.2	%	1,673	94.7	%	1.5	%	(7.4	%)	6.7	%	0.8	%	0.7	%
8			Denver	7,967	5.3	%	1,046	95.0	%	0.0	%	(9.9	%)	5.7	%	0.7	%	(0.7	%)
9			Phoenix	10,769	5.2	%	844	94.5	%	0.5	%	(9.1	%)	7.7	%	0.4	%	0.1	%
10			San Diego	4,284	4.6	%	1,673	94.8	%	0.3	%	(7.2	%)	4.2	%	0.0	%	0.3	%
11			Orlando	8,042	4.6	%	970	94.1	%	(1.9	%)	(8.6	%)	2.6	%	(1.3	%)	(0.6	%)
12			Suburban Maryland	5,325	4.1	%	1,290	94.6	%	(0.2	%)	(2.6	%)	1.1	%	0.8	%	(1.0	%)
13			Orange County, CA	3,307	3.3	%	1,516	94.8	%	(0.3	%)	(8.4	%)	3.7	%	0.2	%	(0.5	%)
14			Atlanta	6,183	3.2	%	958	95.6	%	(0.8	%)	(3.8	%)	1.6	%	(0.2	%)	(0.6	%)
15			Inland Empire, CA	3,639	3.2	%	1,364	94.8	%	0.4	%	(9.3	%)	5.8	%	(0.2	%)	0.5	%
16			All Other Markets	11,661	6.2	%	954	94.6	%	(0.1	%)	(5.5	%)	4.2	%	0.1	%	(0.2	%)
			Total	118,284	100.0	%	$ 1,403	94.6	%	0.0	%	(5.5	%)	3.4	%	0.3	%	(0.3	%)
(1	)	Average rental rate is defined as total rental revenues divided by the weighted average occupied units for the period.

Equity Residential
2010 vs. 2009
Same Store Results/Statistics by Market
										Increase (Decrease) from Prior Year
					2010		2010	2010
					% of		Average	Weighted								Average
					Actual		Rental	Average								Rental
			Markets	Units	NOI		Rate (1)	Occupancy %		Revenues		Expenses		NOI		Rate (1)		Occupancy
1			DC Northern Virginia	8,781	10.6	%	$ 1,666	95.7	%	2.9	%	(0.1	%)	4.4	%	1.7	%	1.1	%
2			South Florida	12,465	10.2	%	1,287	94.4	%	1.7	%	(2.3	%)	4.5	%	0.5	%	1.1	%
3			New York Metro Area	5,887	9.8	%	2,602	95.7	%	(1.3	%)	4.3	%	(4.8	%)	(2.2	%)	0.8	%
4			Los Angeles	7,099	8.2	%	1,686	94.6	%	(1.4	%)	(0.7	%)	(1.7	%)	(2.5	%)	1.1	%
5			Boston	5,229	7.3	%	2,113	95.3	%	2.2	%	1.1	%	2.9	%	1.3	%	0.7	%
6			Seattle/Tacoma	8,473	6.9	%	1,301	93.3	%	(2.3	%)	3.2	%	(5.6	%)	(3.7	%)	1.3	%
7			San Francisco Bay Area	5,924	6.6	%	1,652	94.7	%	(2.0	%)	1.1	%	(3.8	%)	(3.3	%)	1.3	%
8			Denver	7,759	5.6	%	1,029	95.3	%	1.3	%	1.6	%	1.2	%	(0.1	%)	1.4	%
9			Phoenix	10,215	5.2	%	834	94.4	%	(1.8	%)	0.9	%	(3.6	%)	(3.7	%)	1.8	%
10			San Diego	4,103	4.8	%	1,657	94.8	%	0.6	%	1.8	%	0.0	%	0.0	%	0.6	%
11			Orlando	7,690	4.7	%	964	94.4	%	(1.5	%)	(0.5	%)	(2.1	%)	(2.5	%)	1.0	%
12			Suburban Maryland	4,823	3.9	%	1,219	95.1	%	3.0	%	2.0	%	3.6	%	2.0	%	0.9	%
13			Orange County, CA	3,175	3.4	%	1,507	94.8	%	(2.8	%)	0.3	%	(4.2	%)	(3.4	%)	0.7	%
14			Atlanta	5,979	3.4	%	957	95.8	%	(1.9	%)	1.8	%	(4.6	%)	(3.3	%)	1.4	%
15			Inland Empire, CA	3,339	3.1	%	1,350	94.7	%	(1.6	%)	2.2	%	(3.4	%)	(1.9	%)	0.3	%
16			All Other Markets	11,101	6.3	%	1,268	94.7	%	(0.1	%)	0.7	%	(0.6	%)	(1.1	%)	1.0	%
			Total	112,042	100.0	%	$ 1,358	94.8	%	(0.1	%)	0.9	%	(0.8	%)	(1.2	%)	1.1	%
(1	)	Average rental rate is defined as total rental revenues divided by the weighted average occupied units for the period.

Equity Residential
Fourth Quarter 2010 vs. Fourth Quarter 2009
Same Store Operating Expenses
$ in thousands - 113,931 Same Store Units
											% of Actual Q4 2010
		Actual		Actual			$		%		Operating
		Q4 2010		Q4 2009		Change			Change		Expenses
Real estate taxes		$	43,462	$	45,004	$	(1,542	)	(3.4	%)	27.2	%
On-site payroll (1)			36,710		39,735		(3,025	)	(7.6	%)	22.9	%
Utilities (2)			25,486		24,817		669		2.7	%	15.9	%
Repairs and maintenance (3)			22,939		23,165		(226	)	(1.0	%)	14.3	%
Property management costs (4)			18,401		16,017		2,384		14.9	%	11.5	%
Insurance			5,470		5,466		4		0.1	%	3.4	%
Leasing and advertising			3,493		4,281		(788	)	(18.4	%)	2.2	%
Other on-site operating expenses (5)			4,124		4,514		(390	)	(8.6	%)	2.6	%
Same store operating expenses		$	160,085	$	162,999	$	(2,914	)	(1.8	%)	100.0	%
2010 vs. 2009
Same Store Operating Expenses
$ in thousands - 112,042 Same Store Units
											% of Actual 2010
		Actual		Actual			$		%		Operating
			2010		2009	Change			Change		Expenses
Real estate taxes		$	174,131	$	177,180	$	(3,049	)	(1.7	%)	26.6	%
On-site payroll (1)			156,668		156,446		222		0.1	%	23.9	%
Utilities (2)			102,553		100,441		2,112		2.1	%	15.7	%
Repairs and maintenance (3)			97,166		94,223		2,943		3.1	%	14.8	%
Property management costs (4)			69,995		64,022		5,973		9.3	%	10.7	%
Insurance			21,545		21,525		20		0.1	%	3.3	%
Leasing and advertising			14,892		16,029		(1,137	)	(7.1	%)	2.3	%
Other on-site operating expenses (5)			17,713		18,642		(929	)	(5.0	%)	2.7	%
Same store operating expenses		$	654,663	$	648,508	$	6,155		0.9	%	100.0	%
(1)	On-site payroll - Includes payroll and related expenses for on-site personnel including property managers, leasing consultants and maintenance staff.
(2)	Utilities - Represents gross expenses prior to any recoveries under the Resident Utility Billing System ("RUBS"). Recoveries are reflected in rental income.
(3)	Repairs and maintenance - Includes general maintenance costs, unit turnover costs including interior painting, routine landscaping, security, exterminating, fire protection, snow removal, elevator, roof and parking lot repairs and other miscellaneous building repair costs.
(4)	Property management costs - Includes payroll and related expenses for departments, or portions of departments, that directly support on-site management. These include such departments as regional and corporate property management, property accounting, human resources, training, marketing and revenue management, procurement, real estate tax, property legal services and information technology.
(5)	Other on-site operating expenses - Includes administrative costs such as office supplies, telephone and data charges and association and business licensing fees.

Equity Residential
Debt Summary as of December 31, 2010
(Amounts in thousands)
															Weighted
													Weighted		Average
													Average		Maturities
									Amounts (1)		% of Total		Rates (1)		(years)
Secured									$	4,762,896	47.9	%	4.79	%	8.1
Unsecured										5,185,180	52.1	%	4.96	%	4.5
		Total							$	9,948,076	100.0	%	4.88	%	6.2
Fixed Rate Debt:
	Secured - Conventional								$	3,831,393	38.5	%	5.68	%	6.9
	Unsecured - Public/Private									4,375,860	44.0	%	5.78	%	5.1
		Fixed Rate Debt								8,207,253	82.5	%	5.73	%	5.9
Floating Rate Debt:
	Secured - Conventional									326,009	3.3	%	2.56	%	0.7
	Secured - Tax Exempt									605,494	6.1	%	0.48	%	20.4
	Unsecured - Public/Private									809,320	8.1	%	1.72	%	1.3
	Unsecured - Revolving Credit Facility									-	-		0.66	%	1.2
		Floating Rate Debt								1,740,823	17.5	%	1.39	%	7.5
Total									$	9,948,076	100.0	%	4.88	%	6.2
(1)	Net of the effect of any derivative instruments. Weighted average rates are for the year ended December 31, 2010.
	Note: The Company capitalized interest of approximately $13.0 million and $34.9 million during the years ended December 31, 2010 and 2009, respectively. The Company capitalized interest of approximately $2.8 million and $6.2 million during the quarters ended December 31, 2010 and 2009, respectively.
Debt Maturity Schedule as of December 31, 2010
(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)
2011			$	906,266	(2)	$	759,725	(3)	$	1,665,991	16.8	%	5.28	%	3.49	%
2012				778,181			38,128			816,309	8.2	%	5.65	%	5.57	%
2013				269,159			309,828			578,987	5.8	%	6.72	%	4.89	%
2014				562,583			22,034			584,617	5.9	%	5.31	%	5.24	%
2015				357,713			-			357,713	3.6	%	6.40	%	6.40	%
2016				1,167,662			-			1,167,662	11.7	%	5.33	%	5.33	%
2017				1,355,830			456			1,356,286	13.6	%	5.87	%	5.87	%
2018				80,763			44,677			125,440	1.3	%	5.72	%	4.28	%
2019				801,754			20,766			822,520	8.3	%	5.49	%	5.36	%
2020				1,671,836			809			1,672,645	16.8	%	5.50	%	5.50	%
2021+				255,506			544,400			799,906	8.0	%	6.62	%	2.67	%
Total			$	8,207,253		$	1,740,823		$	9,948,076	100.0	%	5.63	%	4.93	%
(1)	Net of the effect of any derivative instruments. Weighted average rates are as of December 31, 2010.
(2)	Includes $482.5 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.
(3)	Includes the Company's $500.0 million term loan facility, which originally matured on October 5, 2010. Effective April 12, 2010, the Company exercised the first of its two one-year extension options. As a result, the maturity date is now October 5, 2011 and there is one remaining one-year extension option exercisable by the Company.

Equity Residential
Unsecured Debt Summary as of December 31, 2010
(Amounts in thousands)
										Unamortized
		Coupon		Due			Face			Premium/			Net
		Rate		Date			Amount			(Discount)			Balance
	Fixed Rate Notes:
		6.950	%	03/02/11			$	93,096		$	205		$	93,301
		6.625	%	03/15/12				253,858			(229	)		253,629
		5.500	%	10/01/12				222,133			(383	)		221,750
		5.200	%	04/01/13	(1	)		400,000			(266	)		399,734
	Fair Value Derivative Adjustments				(1	)		(300,000	)		-			(300,000	)
		5.250	%	09/15/14				500,000			(228	)		499,772
		6.584	%	04/13/15				300,000			(469	)		299,531
		5.125	%	03/15/16				500,000			(278	)		499,722
		5.375	%	08/01/16				400,000			(1,036	)		398,964
		5.750	%	06/15/17				650,000			(3,306	)		646,694
		7.125	%	10/15/17				150,000			(441	)		149,559
		4.750	%	07/15/20				600,000			(4,349	)		595,651
		7.570	%	08/15/26				140,000			-			140,000
		3.850	%	08/15/26	(2	)		482,545			(4,992	)		477,553
								4,391,632			(15,772	)		4,375,860
	Floating Rate Notes:
				04/01/13	(1	)		300,000			-			300,000
	Fair Value Derivative Adjustments				(1	)		9,320			-			9,320
	Term Loan Facility	LIBOR+0.50%		10/05/11	(3	)(4)		500,000			-			500,000
								809,320			-			809,320
	Revolving Credit Facility:	LIBOR+0.50%		02/28/12	(3	)(5)		-			-			-
	Total Unsecured Debt						$	5,200,952		$	(15,772	)	$	5,185,180
(1)	$300.0 million in fair value interest rate swaps converts a portion of the 5.200% notes due April 1, 2013 to a floating interest rate.
(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.
(3)	Facilities are private. All other unsecured debt is public.
(4)	Represents the Company's $500.0 million term loan facility, which originally matured on October 5, 2010. Effective April 12, 2010, the Company exercised the first of its two one-year extension options. As a result, the maturity date is now October 5, 2011 and there is one remaining one-year extension option exercisable by the Company.
(5)	As of December 31, 2010, there was approximately $1.28 billion available on the Company's unsecured revolving credit facility.

Equity Residential
Selected Unsecured Public Debt Covenants
			December 31,	September 30,
			2010	2010
	Total Debt to Adjusted Total Assets (not to exceed 60%)		48.5%	49.9%
	Secured Debt to Adjusted Total Assets (not to exceed 40%)		23.2%	23.8%
	Consolidated Income Available for Debt Service to
		Maximum Annual Service Charges
		(must be at least 1.5 to 1)	2.46	2.43
	Total Unsecured Assets to Unsecured Debt		256.0%	238.5%
		(must be at least 150%)
	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 December 31, 2010
(Amounts in thousands except for share/unit and per share amounts)
			Secured Debt							$	4,762,896	47.9%
			Unsecured Debt								5,185,180	52.1%
		Total Debt									9,948,076	100.0%	38.4%
			Common Shares (includes Restricted Shares)				290,197,242		95.5%
			Units (includes OP Units and LTIP Units)				13,612,037		4.5%
		Total Shares and Units					303,809,279		100.0%
		Common Share Price at December 31, 2010				$	51.95
											15,782,892	98.7%
		Perpetual Preferred Equity (see below)									200,000	1.3%
		Total Equity									15,982,892	100.0%	61.6%
		Total Market Capitalization								$	25,930,968		100.0%
Perpetual Preferred Equity as of December 31, 2010
(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%
Note: Both the Series E and the Series H Convertible Preferred Shares were redeemed on November 1, 2010.

Equity Residential
Common Share and Unit
Weighted Average Amounts Outstanding
			2010	2009	Q410	Q409
Weighted Average Amounts Outstanding for Net Income Purposes:
	Common Shares - basic		282,887,601	273,609,477	285,915,811	275,519,463
	Shares issuable from assumed conversion/vesting of (1):
		- OP Units	-	-	-	-
		- long-term compensation award shares/units	-	-	-	-
	Total Common Shares and Units - diluted (1)		282,887,601	273,609,477	285,915,811	275,519,463
Weighted Average Amounts Outstanding for FFO and Normalized
FFO Purposes:
	Common Shares - basic		282,887,601	273,609,477	285,915,811	275,519,463
	OP Units - basic		13,639,866	15,557,540	13,446,804	14,173,726
	Total Common Shares and OP Units - basic		296,527,467	289,167,017	299,362,615	289,693,189
	Shares issuable from assumed conversion/vesting of:
		- convertible preferred shares/units	325,103	402,501	114,425	398,038
		- long-term compensation award shares/units	3,762,390	938,094	4,465,378	1,892,471
	Total Common Shares and Units - diluted		300,614,960	290,507,612	303,942,418	291,983,698
Period Ending Amounts Outstanding:
	Common Shares (includes Restricted Shares)		290,197,242	279,959,048
	Units (includes OP Units and LTIP Units)		13,612,037	14,197,969
	Total Shares and Units		303,809,279	294,157,017
(1)	Potential common shares issuable from the assumed conversion of OP Units and the exercise/vesting of long-term compensation award shares/units are automatically anti-dilutive and therefore excluded from the diluted earnings per share calculation as the Company had a loss from continuing operations for the years ended December 31, 2010 and 2009, respectively, and the fourth quarters ended December 31, 2010 and 2009, respectively.

Equity Residential
Partially Owned Entities as of December 31, 2010
(Amounts in thousands except for project and unit amounts)
			Consolidated
			Development Projects
			Held for
			and/or Under			Completed, Not			Completed
			Development			Stabilized (4)			and Stabilized			Other			Total
Total projects (1)				-			1			4			19			24
Total units (1)				-			490			1,302			3,440			5,232
Operating information for the year
	ended 12/31/10 (at 100%):
	Operating revenue		$	4		$	6,344		$	25,607		$	55,928		$	87,883
	Operating expenses			758			3,458			9,370			19,906			33,492
	Net operating (loss) income			(754	)		2,886			16,237			36,022			54,391
	Depreciation			-			-			12,239			14,882			27,121
	General and administrative/other			51			-			127			92			270
	Impairment			8,959			-			-			-			8,959
	Operating (loss) income			(9,764	)		2,886			3,871			21,048			18,041
	Interest and other income			23			-			10			30			63
	Other expenses			(493	)		-			-			(548	)		(1,041	)
	Interest:
		Expense incurred, net		(925	)		(2,872	)		(6,596	)		(20,576	)		(30,969	)
		Amortization of deferred financing costs		-			-			(753	)		(238	)		(991	)
	(Loss) income before income and other taxes
		and discontinued operations		(11,159	)		14			(3,468	)		(284	)		(14,897	)
	Income and other tax (expense) benefit			(31	)		-			-			(5	)		(36	)
	Net loss on sales of land parcels			(234	)		-			-			-			(234	)
	Net gain on sales of discontinued operations			711			-			-			34,842			35,553
	Net (loss) income		$	(10,713	)	$	14		$	(3,468	)	$	34,553		$	20,386
Debt - Secured (2):
		EQR Ownership (3)	$	18,342		$	141,741		$	275,348		$	252,857		$	688,288
		Noncontrolling Ownership		-			-			-			61,678			61,678
Total (at 100%)			$	18,342		$	141,741		$	275,348		$	314,535		$	749,966
(1) Project and unit counts exclude all uncompleted development projects until those projects are substantially completed.
(2) All debt is non-recourse to the Company with the exception of $14.0 million in mortgage debt on one development 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.
Note: On December 29, 2010, the Company admitted an 80% institutional partner to an entity owning a developable land parcel in Florida in exchange for $11.7 million in cash and retained a 20% equity interest. This land parcel is now unconsolidated. Total project cost is approximately $76.1 million and construction is expected to start in the first quarter of 2011. The Company is responsible for constructing the project and has given certain construction cost overun guarantees. The Company's remaining funding obligation is currently estimated at approximately $2.5 million.

Equity Residential
Consolidated Development and Lease-Up Projects as of December 31, 2010
(Amounts in thousands except for project and unit amounts)
			No. of	Total Capital		Total Book Value		Total Book Value Not Placed in			Total			Percentage		Percentage		Percentage	Estimated Completion	Estimated Stabilization
Projects		Location	Units	Cost (1)		to Date		Service			Debt			Completed		Leased		Occupied	Date	Date
Projects Under Development - Wholly Owned:
Red 160 (formerly Redmond Way)		Redmond, WA	250	$	84,382	$	76,964	$	76,964		$	-			97%		86%	68%	Q1 2011	Q1 2012
500 West 23rd Street (formerly 10 Chelsea) (2)		New York, NY	111		55,555		27,382		27,382			-			33%		-	-	Q4 2011	Q4 2012
Savoy III		Aurora, CO	168		23,856		5,409		5,409			-			7%		-	-	Q3 2012	Q2 2013
2201 Pershing Drive		Arlington, VA	188		64,242		14,707		14,707			-			1%		-	-	Q3 2012	Q3 2013
Projects Under Development - Wholly Owned			717		228,035		124,462		124,462			-
Projects Under Development			717		228,035		124,462		124,462			-
Completed Not Stabilized - Wholly Owned (3):
Reunion at Redmond Ridge		Redmond, WA	321		53,175		53,151		-			-					94%	93%	Completed	Q1 2011
Westgate		Pasadena, CA	480		165,558		154,886		-			135,000	(4)				80%	76%	Completed	Q3 2011
425 Mass (5)		Washington, D.C.	559		166,750		166,750		-			-					61%	58%	Completed	Q1 2012
Vantage Pointe (5)		San Diego, CA	679		200,000		200,000		-			-					42%	41%	Completed	Q3 2012
Projects Completed Not Stabilized - Wholly Owned			2,039		585,483		574,787		-			135,000
Completed Not Stabilized - Partially Owned (3):
The Brooklyner (formerly 111 Lawrence Street)		Brooklyn, NY	490		272,368		257,748		-			141,741					93%	89%	Completed	Q2 2011
Projects Completed Not Stabilized - Partially Owned			490		272,368		257,748		-			141,741
Projects Completed Not Stabilized			2,529		857,851		832,535		-			276,741
Completed and Stabilized During the Quarter - Wholly Owned:
70 Greene (formerly 77 Hudson)		Jersey City, NJ	480		268,458		267,403		-			-					93%	91%	Completed	Stabilized
Third Square (formerly 303 Third)		Cambridge, MA	482		257,457		256,546		-			-					94%	92%	Completed	Stabilized
Projects Completed and Stabilized During the Quarter - Wholly Owned			962		525,915		523,949		-			-
Projects Completed and Stabilized During the Quarter			962		525,915		523,949		-			-
Total Projects			4,208	$	1,611,801	$	1,480,946	$	124,462	(6)	$	276,741
Land Held for Development			N/A		N/A	$	235,247	$	235,247		$	18,342
														Total Capital		Q4 2010
NOI CONTRIBUTION FROM DEVELOPMENT PROJECTS														Cost (1)		NOI
Projects Under Development														$	228,035	$	404
Completed Not Stabilized															857,851		4,735
Completed and Stabilized During the Quarter															525,915		3,198
Total Development NOI Contribution														$	1,611,801	$	8,337
(1)	Total capital cost represents estimated cost for projects under development and/or developed 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)	500 West 23rd Street - The land under this development is subject to a long term ground lease.
(3)	Properties included here are substantially complete. However, they may still require additional exterior and interior work for all units to be available for leasing.
(4)	Debt is tax-exempt bonds that are entirely outstanding, with $16.8 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 12/31/10. The Company paid off the $28.2 million in taxable bonds during the fourth quarter of 2010.
(5)	The Company acquired these completed development projects prior to stabilization and has begun/continued lease-up activities.
(6)	Total book value not placed in service excludes $5.9 million of construction-in-progress related to the reconstruction of the Prospect Towers garage.

Equity Residential
Repairs and Maintenance Expenses and Capital Expenditures to Real Estate
For the Year Ended December 31, 2010
(Amounts in thousands except for unit and per unit amounts)
			Repairs and Maintenance Expenses						Capital Expenditures to Real Estate							Total Expenditures
											Building
		Total		Avg.		Avg.		Avg.	Replacements	Avg.	Improvements	Avg.		Avg.		Grand	Avg.
		Units (1)	Expense (2)	Per Unit	Payroll (3)	Per Unit	Total	Per Unit	(4)	Per Unit	(5)	Per Unit	Total	Per Unit		Total	Per Unit
Same Store Properties (6)		112,042	$ 97,166	$ 867	$ 81,427	$ 727	$ 178,593	$ 1,594	$ 70,620	$ 630	$ 54,118	$ 483	$ 124,738	$ 1,113	(9)	$ 303,331	$ 2,707
Non-Same Store Properties (7)		12,824	8,978	982	7,285	797	16,263	1,779	4,180	457	5,547	607	9,727	1,064		25,990	2,843
Other (8)		-	3,430		5,501		8,931		1,509		2,234		3,743			12,674
Total		124,866	$ 109,574		$ 94,213		$ 203,787		$ 76,309		$ 61,899		$ 138,208			$ 341,995
(1)	Total Units - Excludes 4,738 military housing units for which repairs and maintenance expenses and capital expenditures to real estate are self-funded and do not consolidate into the Company's results.
(2)	Repairs and Maintenance Expenses - Includes general maintenance costs, unit turnover costs including interior painting, routine landscaping, security, exterminating, fire protection, snow removal, elevator, roof and parking lot repairs and other miscellaneous building repair costs.
(3)	Maintenance Payroll - Includes payroll and related expenses for maintenance staff.
(4)	Replacements - Includes new expenditures inside the units such as appliances, mechanical equipment, fixtures and flooring, including carpeting. Replacements for same store properties also include $31.7 million spent in 2010 on unit renovations/rehabs (primarily kitchens and baths) on 4,331 units (equating to about $7,300 per unit rehabbed) designed to reposition these assets for higher rental levels in their respective markets. In 2011, the Company expects to spend approximately $41.0 million rehabbing 5,500 units (equating to about $7,500 per unit rehabbed).
(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)	Same Store Properties - Primarily includes all properties acquired or completed and stabilized prior to January 1, 2009, less properties subsequently sold.
(7)	Non-Same Store Properties - Primarily includes all properties acquired during 2009 and 2010, plus any properties in lease-up and not stabilized as of January 1, 2009. Per unit amounts are based on a weighted average of 9,141 units.
(8)	Other - Primarily includes expenditures for properties sold during the period.
(9)	For 2011, the Company estimates that it will spend approximately $1,200 per unit of capital expenditures for its same store properties inclusive of unit renovation/rehab costs, or $850 per unit excluding unit renovation/rehab costs.

Equity Residential
Discontinued Operations
(Amounts in thousands)
		Year Ended						Quarter Ended
		December 31,						December 31,
			2010			2009			2010			2009
REVENUES
Rental income		$	67,670		$	160,031		$	13,871		$	23,354
	Total revenues		67,670			160,031			13,871			23,354
EXPENSES (1)
Property and maintenance			18,659			49,088			3,852			7,983
Real estate taxes and insurance			7,028			18,065			1,446			3,510
Depreciation			16,770			41,104			3,208			6,241
General and administrative			36			34			9			5
	Total expenses		42,493			108,291			8,515			17,739
Discontinued operating income			25,177			51,740			5,356			5,615
Interest and other income			497			120			22			13
Other expenses			-			(1	)		-			(1	)
Interest (2):
	Expense incurred, net		(7,722	)		(8,660	)		(3,347	)		(2,928	)
	Amortization of deferred financing costs		(37	)		(561	)		(14	)		(10	)
Income and other tax (expense) benefit			(44	)		1,161			(2	)		1,252
Discontinued operations			17,871			43,799			2,015			3,941
Net gain on sales of discontinued operations			297,956			335,299			228,418			60,366
Discontinued operations, net		$	315,827		$	379,098		$	230,433		$	64,307
(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 Guidance Reconciliations and Non-Comparable Items
(Amounts in thousands except per share data)
(All per share data is diluted)
FFO Guidance Reconciliations
										FFO Reconciliations
										Guidance Q4 2010
										to Actual Q4 2010
										Amounts			Per Share
		Guidance Q4 2010 FFO - Diluted (1) (3)								$	174,941		$	0.580
		Property NOI									4,392			0.014
		Other									2,521			0.004
		Actual Q4 2010 FFO before impairment									181,854			0.598
		Impairment									(45,380	)		(0.149	)
		Actual Q4 2010 FFO - Diluted (1) (3)									136,474			0.449
		Adjustments (see detail below):
			Asset impairment and valuation allowances								45,380			0.149
			Property acquisition costs and write-off of pursuit costs (other expenses)								2,415			0.008
			Debt extinguishment (gains) losses, including prepayment penalties, preferred share redemptions and non-cash convertible debt discounts
											1,921			0.006
			(Gains) losses on sales of non-operating assets, net of income and other tax expense (benefit)
											(657	)		(0.002	)
			Other miscellaneous non-comparable items								(994	)		(0.003	)
		Actual Q4 2010 Normalized FFO - Diluted (2) (3)								$	184,539		$	0.607
Non-Comparable Items – Adjustments from FFO to Normalized FFO (2) (3)
				Year Ended December 31,									Quarter Ended December 31,
					2010			2009		Variance				2010			2009		Variance
Impairment				$	45,380		$	11,124		$	34,256		$	45,380		$	-		$	45,380
Asset impairment and valuation allowances					45,380			11,124			34,256			45,380			-			45,380
Property acquisition costs (other expenses)					6,656			1,650			5,006			655			1,395			(740	)
Write-off of pursuit costs (other expenses)					5,272			4,838			434			1,760			2,865			(1,105	)
Property acquisition costs and write-off of pursuit costs (other expenses)					11,928			6,488			5,440			2,415			4,260			(1,845	)
Debt extinguishment gains (interest and other income)					-			(4,455	)		4,455			-			-			-
Prepayment premiums/penalties (interest expense)					2,456			21,980			(19,524	)		2,298			21,945			(19,647	)
Write-off of unamortized deferred financing costs (interest expense)					1,048			3,536			(2,488	)		44			1,208			(1,164	)
Write-off of unamortized (premiums)/discounts/OCI (interest expense)					(2,689	)		907			(3,596	)		(2,365	)		149			(2,514	)
Non-cash convertible debt discount (interest expense)					7,779			10,590			(2,811	)		1,944			3,425			(1,481	)
EQR 25% share of unconsolidated defeasance costs
	(loss from investments in unconsolidated entities)				-			1,775			(1,775	)		-			-			-
Debt extinguishment (gains) losses, including prepayment penalties, preferred
	share redemptions and non-cash convertible debt discounts				8,594			34,333			(25,739	)		1,921			26,727			(24,806	)
Gain on sale of investment securities (interest and other income)					-			(4,943	)		4,943			-			-			-
Net loss on sales of land parcels					1,395			-			1,395			234			-			234
Net incremental (gain) loss on sales of condominium units					(1,506	)		385			(1,891	)		(887	)		(65	)		(822	)
Income and other tax expense (benefit) - Condo sales					31			(1,179	)		1,210			(4	)		(1,246	)		1,242
(Gains) losses on sales of non-operating assets, net of income and other
	tax expense (benefit)				(80	)		(5,737	)		5,657			(657	)		(1,311	)		654
Insurance/litigation settlement expense (property and maintenance)					1,680			-			1,680			1,680			-			1,680
Insurance/litigation settlement proceeds (interest and other income)					(5,192	)		(171	)		(5,021	)		-			-			-
Prospect Towers garage insurance proceeds (real estate taxes and insurance)					(2,674	)		-			(2,674	)		(2,674	)		-			(2,674	)
Other miscellaneous non-comparable items					(6,186	)		(171	)		(6,015	)		(994	)		-			(994	)
Non-comparable items – Adjustments from FFO to Normalized FFO (2) (3)				$	59,636		$	46,037		$	13,599		$	48,065		$	29,676		$	18,389
Note: See page 26 for the definitions, the footnotes referenced above and the reconciliations of EPS to FFO and Normalized FFO.

Equity Residential
Normalized FFO Guidance and Assumptions
The guidance/projections provided below are based on current expectations and are forward-looking. All guidance is given on a Normalized FFO basis.
2011 Normalized FFO Guidance (per share diluted)
	Q1 2011	2011
Expected Normalized FFO (2) (3)	$0.53 to $0.57	$2.40 to $2.50
2011 Same Store Assumptions
Physical occupancy		95.0%
Revenue change		4.0% to 5.0%
Expense change		1.0% to 2.0%
NOI change		5.0% to 7.5%
(Note: 25 basis point change in NOI percentage = $0.01 per share change in EPS/FFO)
2011 Transaction Assumptions
Consolidated rental acquisitions		$1.0 billion
Consolidated rental dispositions		$1.25 billion
Capitalization rate spread		125 basis points
2011 Debt Assumptions (see Note)
Weighted average debt outstanding		$9.6 billion to $9.8 billion
Weighted average interest rate (reduced for capitalized interest)		4.90%
Interest expense		$470.0 million to $480.0 million
2011 Other Guidance Assumptions (see Note)
General and administrative expense		$40.0 million to $42.0 million
Interest and other income		$2.0 million to $3.0 million
Income and other tax expense		$0.5 million to $1.5 million
Weighted average Common Shares and Units - Diluted		310.8 million
Note: All guidance is given on a Normalized FFO basis. Therefore, certain items excluded from Normalized FFO, such as debt extinguishment costs/prepayment penalties and the write-off of pursuit and property acquisition costs, are not included in the estimates provided on this page. See page 26 for the definitions, the footnotes referenced above and the reconciliations of EPS to FFO and Normalized FFO.

Equity Residential
Additional Reconciliations, Definitions and Footnotes
(Amounts in thousands except per share data)
(All per share data is diluted)
The guidance/projections provided below are based on current expectations and are forward-looking.
Reconciliations of EPS to FFO and Normalized FFO for Pages 6, 24 and 25
								Expected			Expected
		Expected Q4 2010						Q1 2011				2011
		Amounts			Per Share			Per Share			Per Share
	Expected Earnings - Diluted (5)	$	215,996		$	0.716		$0.30 to $0.34			$1.75 to $1.85
	Add: Expected depreciation expense		172,174			0.571			0.55			2.26
	Less: Expected net gain on sales (5)		(213,229	)		(0.707	)		(0.33	)		(1.66	)
	Expected FFO - Diluted (1) (3)		174,941			0.580		0.52 to 0.56			2.35 to 2.45
	Asset impairment and valuation allowances		-			-			-			-
	Property acquisition costs and write-off of pursuit costs (other expenses)		2,000			0.007			0.01			0.03
	Debt extinguishment (gains) losses, including prepayment penalties, preferred share redemptions and non-cash convertible debt discounts
			1,777			0.005			-			0.02
	(Gains) losses on sales of non-operating assets, net of income and other
	tax expense (benefit)		-			-			-			-
	Other miscellaneous non-comparable items		-			-			-			-
	Expected Normalized FFO - Diluted (2) (3)	$	178,718		$	0.592		$0.53 to $0.57			$2.40 to $2.50
Definitions and Footnotes for Pages 6, 24 and 25
(1)	The National Association of Real Estate Investment Trusts ("NAREIT") defines funds from operations ("FFO") (April 2002 White Paper) as net income (computed in accordance with accounting principles generally accepted in the United States ("GAAP")), excluding gains (or losses) from sales of depreciable property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures.  Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect funds from operations on the same basis.  The April 2002 White Paper states that gain or loss on sales of property is excluded from FFO for previously depreciated operating properties only.  Once the Company commences the conversion of units to condominiums, it simultaneously discontinues depreciation of such property.
(2)	Normalized funds from operations ("Normalized FFO") begins with FFO and excludes:
	• the impact of any expenses relating to asset impairment and valuation allowances;
	• property acquisition and other transaction costs related to mergers and acquisitions and pursuit cost write-offs (other expenses);
	• gains and losses from early debt extinguishment, including prepayment penalties, preferred share redemptions and the cost related to the implied option value of non-cash convertible debt discounts;
	• gains and losses on the sales of non-operating assets, including gains and losses from land parcel and condominium sales, net of the effect of income tax benefits or expenses; and
	• other miscellaneous non-comparable items.
(3)	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. The company also believes that Normalized FFO and Normalized 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 allow investors to compare the company's operating performance to its performance in prior reporting periods and to the operating performance of other real estate companies without the effect of items that by their nature are not comparable from period to period and tend to obscure the Company's actual operating results.  FFO, FFO available to Common Shares and Units, Normalized FFO and Normalized 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, FFO available to Common Shares and Units, Normalized FFO and Normalized 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, FFO available to Common Shares and Units, Normalized FFO and Normalized 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.
(4)	FFO available to Common Shares and Units and Normalized FFO available to Common Shares and Units are 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.
(5)	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 2010 and Fourth Quarter 2010 Same Store Properties:
		Year Ended December 31,						Quarter Ended December 31,
			2010			2009			2010			2009
Operating income		$	442,001		$	496,601		$	93,325		$	126,954
Adjustments:
	Non-same store operating results		(105,960	)		(21,336	)		(30,579	)		(7,407	)
	Fee and asset management revenue		(9,476	)		(10,346	)		(1,880	)		(2,418	)
	Fee and asset management expense		5,140			7,519			776			1,603
	Depreciation		656,633			559,271			168,500			142,647
	General and administrative		39,887			38,994			8,853			8,518
	Impairment		45,380			11,124			45,380			-
Same store NOI		$	1,073,605		$	1,081,827		$	284,375		$	269,897

CONTACT:
Equity Residential
Marty McKenna, 312-928-1901
mmckenna@eqrworld.com