Exhibit 12
ERP OPERATING LIMITED PARTNERSHIP
Computation of Ratio of Earnings to Combined Fixed Charges
| | Nine Months Ended
September 30, | | Year Ended December 31, | |
| | 2006 | | 2005 | | 2005 | | 2004 | | 2003 | | 2002 | | 2001 | |
| | | | | | | | | | | | | | | |
Income from continuing operations | | $ | 95,323 | | $ | 134,799 | | $ | 168,184 | | $ | 115,628 | | $ | 123,077 | | $ | 132,386 | | $ | 188,917 | |
| | | | | | | | | | | | | | | |
Interest expense incurred, net | | 319,236 | | 266,063 | | 363,756 | | 309,150 | | 294,490 | | 289,851 | | 293,975 | |
Amortization of deferred financing costs | | 6,419 | | 4,832 | | 6,514 | | 5,825 | | 5,280 | | 5,292 | | 4,597 | |
| | | | | | | | | | | | | | | |
Earnings before combined fixed charges and preferred distributions | | 420,978 | | 405,694 | | 538,454 | | 430,603 | | 422,847 | | 427,529 | | 487,489 | |
| | | | | | | | | | | | | | | |
Preference Unit distributions | | (29,682 | ) | (39,004 | ) | (49,642 | ) | (53,746 | ) | (76,435 | ) | (76,615 | ) | (87,504 | ) |
Preference Interest and Junior Preference Unit distributions | | (1,779 | ) | (6,442 | ) | (7,606 | ) | (19,490 | ) | (20,536 | ) | (20,536 | ) | (18,615 | ) |
Premium on redemption of Preference Units | | (3,941 | ) | (4,316 | ) | (4,359 | ) | — | | (20,237 | ) | — | | (5,324 | ) |
Premium on redemption of Preference Interests | | (684 | ) | (4,134 | ) | (4,134 | ) | (1,117 | ) | — | | — | | — | |
| | | | | | | | | | | | | | | |
Earnings before combined fixed charges | | $ | 384,892 | | $ | 351,798 | | $ | 472,713 | | $ | 356,250 | | $ | 305,639 | | $ | 330,378 | | $ | 376,046 | |
| | | | | | | | | | | | | | | |
Interest expense incurred, net | | $ | 319,236 | | $ | 266,063 | | $ | 363,756 | | $ | 309,150 | | $ | 294,490 | | $ | 289,851 | | $ | 293,975 | |
Amortization of deferred financing costs | | 6,419 | | 4,832 | | 6,514 | | 5,825 | | 5,280 | | 5,292 | | 4,597 | |
Interest capitalized for real estate and unconsolidated entities under development | | 13,176 | | 9,105 | | 13,701 | | 13,969 | | 20,647 | | 27,167 | | 28,174 | |
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Total combined fixed charges | | 338,831 | | 280,000 | | 383,971 | | 328,944 | | 320,417 | | 322,310 | | 326,746 | |
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Preference Unit distributions | | 29,682 | | 39,004 | | 49,642 | | 53,746 | | 76,435 | | 76,615 | | 87,504 | |
Preference Interest and Junior Preference Unit distributions | | 1,779 | | 6,442 | | 7,606 | | 19,490 | | 20,536 | | 20,536 | | 18,615 | |
Premium on redemption of Preference Units | | 3,941 | | 4,316 | | 4,359 | | — | | 20,237 | | — | | 5,324 | |
Premium on redemption of Preference Interests | | 684 | | 4,134 | | 4,134 | | 1,117 | | — | | — | | — | |
| | | | | | | | | | | | | | | |
Total combined fixed charges and preferred distributions | | $ | 374,917 | | $ | 333,896 | | $ | 449,712 | | $ | 403,297 | | $ | 437,625 | | $ | 419,461 | | $ | 438,189 | |
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Ratio of earnings before combined fixed charges to total combined fixed charges (1) | | 1.14 | | 1.26 | | 1.23 | | 1.08 | | — | | 1.03 | | 1.15 | |
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Ratio of earnings before combined fixed charges and preferred distributions to total combined fixed charges and preferred distributions (1) | | 1.12 | | 1.22 | | 1.20 | | 1.07 | | — | | 1.02 | | 1.11 | |
(1) For 2003, the coverage deficiencies on both ratios approximated $14.8 million. All ratios have been reduced due to the disposition of properties and the reclassification of the Lexford Housing Division to held for sale, both of which resulted in the inclusion of those properties in discontinued operations for all periods presented. For 2003, the ratios have been further reduced due to the one-time $20.2 million premium on the redemption of the Series G Preference Units.
