EQUITY RESIDENTIAL (EQR)

Interest and other income from continuing operations decreased by approximately $57.9 million, primarily as a result of the $57.1 million in cash received during the six months ended June 30, 2005 for the Company’s ownership interest in Rent.com, which was acquired by eBay, Inc.

Interest expense from continuing operations, including amortization of deferred financing costs, increased approximately $36.6 million primarily as a result of higher variable interest rates and overall debt levels outstanding.  During the six months ended June 30, 2006, the Company capitalized interest costs of approximately $7.8 million as compared to $5.8 million for the six months ended June 30, 2005.  This capitalization of interest primarily relates to projects under development.  The effective interest cost on all indebtedness for the six months ended June 30, 2006 was 6.19% as compared to 6.18% for the six months ended June 30, 2005.

Loss from investments in unconsolidated entities increased approximately $0.2 million between the periods under comparison.  This increase is primarily the result of consolidating previously unconsolidated properties as of January 1, 2006 as the result of EITF Issue No. 04-05.  See Note 4 in the Notes to Consolidated Financial Statements for further discussion.

Net gain on sales of land parcels decreased $10.1 million, due to a large gain recorded on the sale of one land parcel during the six months ended June 30, 2005.

Discontinued operations, net of minority interests, increased approximately $221.0 million between the periods under comparison.  This increase is primarily the result of higher per unit sales prices and lower real estate net book values for properties sold during the six months ended June 30, 2006 as compared to the same period in 2005.  Discontinued operations, net of minority interests includes our Lexford Housing Division, which is held for sale as of June 30, 2006.  See Note 13 in the Notes to Consolidated Financial Statements for further discussion.