Good morning, ladies and gentlemen and thank you for participating in the Mid-America Apartment Communities fourth quarter earnings release conference call. The company will first share its prepared comments followed by a question-and-answer session. At this time, we would like to turn the call over to Leslie Wolfgang, Director of External Reporting. Ms. Wolfgang, you may begin.

Thank you, [Tyrone], and good morning, everyone. This is Leslie Wolfgang, Director of External Reporting for Mid-America Apartment Communities. With me this morning are Eric Bolton, our CEO; Simon Wadsworth, our CFO; Al Campbell, Treasurer; Tom Grimes, Director of Property Management; and Drew Taylor, Director of Asset Management. Before we begin, I want to point out that as part of the discussion this morning, company management will make forward-looking statements. Please refer to the Safe Harbor language included in yesterday's press release and our 34 Act filings with the SEC, which describe risk factors that may impact future results. These reports along with a copy of today's prepared comments and an audio copy of this morning's call can be found on our website. I'll now turn the call over to Eric.

Thanks, Leslie and good morning everyone. As reported in yesterday’s earning release, Mid-America ended 2008 on a positive note. Despite a challenging marketing environment, funds from operation in the fourth quarter were $0.01 per share ahead of the midpoint of our guidance. For calendar year 2008, FFO per share grew by 5% and importantly was only $0.02 per share below the midpoint of our original guidance. This is worth noting given that our original 2008 guidance issued last February did not contemplate the significant deterioration in leasing fundamentals that occurred over the last few months of the year nor did our original guidances, we had raised a $104 million of new equity during the year. Achieving 5% growth in FFO per share and performing largely in line with our original expectations despite these challenges reflects a number of positive aspects about Mid-America’s strength and stability in portfolio strategy, operating platform, financing strategy, and our approach to deploying capital. These same strengths are what now enable Mid-America to be well positioned for what will obviously be a more challenging operating environment in 2009. As we consider the forecast for 2009, we believe that consistent with the last downturn for apartment fundamentals, Mid-America will weather the weaker leasing cycle better than most. There are several aspects to our earnings platform that enable Mid-America to deliver strong financial results during up cycles and to better weather down cycles without putting the balance sheet risk, without writing off significant asset value and without raising real concern about the dividend. We were able to demonstrate some of these strengths in the challenging fourth quarter just ended and believe they will continue to support our performance in 2009. The first key attribute to our earnings platform is of course our portfolio of strategy. While it's clear…

Eric thanks. Good morning everybody. Our fourth quarter FFO per share of $0.92 was $0.01 ahead of the mid-point of our guidance. Performance was driven by three key elements. Despite weakening employment, our operating results were close to our forecast. Our property management and G&A expense was $900,000 below the same quarter a year ago. And our interest expense also below our forecast as rates began to trend down, reflecting an average interest rate of 4.8%, compared to 5.2% for the same quarter a year ago. In the fourth quarter, the markets were tougher than anyone expected, but we still performed quite well, although our good operating performance was masked by some one-time items and some unusual comparisons. Year-over-year, same-store revenue growth was 0.2%, despite the worse than expected job losses and the tough comparison of the very strong fourth quarter in 2007. Two markets, Atlanta and to a lesser extent Jacksonville were weak, and dragged down our same-store revenue performance. Absent these two markets, our same-store revenues increased 1.0%. Same-store expenses prior to taxes and insurance increased 1.5% and this included $310,000 expenses attributable to Hurricane Ike. Excluding these Hurricane Ike expenses the increase was only 0.1%. Including taxes and insurance, total same-store expenses increased 3.6%, but again this was comparing to an unusual fourth quarter 2007 when same-store expenses dropped 1.2% because of favorable real estate taxes. As a result of last year’s fourth quarter tax adjustments, our same-store real estate taxes increased 7.8% this past quarter. If you normalize the real estate tax increase, and eliminate the hit from Hurricane Ike, our NOI for the quarter goes from a negative 2.1% to a negative 0.7%. So, our reported NOI was not necessarily indicative of our performance in these changing market conditions. For the full year, our FFO…

Thanks, Simon. Last week marked the 15-year anniversary of Mid-America’s IPO. It’s worth noting that despite the significant fall off in our stock price over the past year, the annual compounded return delivered to shareholders over that 15-year period is almost 11%. That performance over the same period of time beats the S&P 500 by roughly 500 basis points. It beats the overall REIT index by over 300 basis points and it beats the overall apartment REIT index by over 200 basis points. Our record of performance and strategy for creating value continues to be centered on disciplined capital allocation practices, maintaining a high quality portfolio of assets, focused on building high quality and recurring earnings, and supporting future growth, and a cash dividend through maintaining a strong balance sheet. We believe it's just as important to be able to weather downturns effectively as it is to prosper during robust partially real estate and capital market cycle. We are confidant and our ability to perform during this down part of the cycle. And we are excited about the opportunities in front of us. That’s all we have in the way of prepared comments. So, operator, I’m going to turn it back to you for any questions.

(Operator Instructions). Our first question is from Michael Salinsky of RBC Capital Markets. Your line is open. Michael Salinsky – RBC Capital Markets: Good morning guys and Simon thank you for the additional color on GSEs there. In your guidance for 2009, can you break out the impact you expect from the bulk cable and utility reimbursement programs? Just so we can get an apples-to-apples comparison on a year-over-year basis?

Michael Salinsky – RBC Capital Markets: Okay, that’s helpful. Eric several of your peers have mentioned they think 2010 maybe an equally challenging or even more challenging year. What are you initial thoughts just given the downturn right now and when we come out of that?

Well, Mike obviously it depends on what happens with the economy and the employment numbers and I don’t know, I think that last time we went through a downturn it did last for couple of years, and the sector produced two years of negative NOI performance. I think that is likely that 2010 will indeed be another challenging year. I like to believe that by the last half or maybe by Q4 we really are starting to see things turnaround, but I do think that 2010 will likely be a challenging year. The severity evidence is, I could begin to really guess at it right now. Obviously, we have to see what the government does and how they kind of response to lot of the plans and programs being discussed. But I would certainly think that this current downturn is going to be with us for a while.

Mike I think one of, Eric and I were at the National Multi Housing Council Conference, couple of weeks ago and recently in the sort of third party economists and market trackers that we saw and listened to kind of indicating a second half of 2010 recovery. And that’s probably the best information at this point that’s opened to us. Michael Salinsky – RBC Capital Markets: Okay. Then third and final in your guidance for 2009, you include $75 million of acquisitions in a new fund. How far long are you on that fund in talking to private equity and various other sponsors, what is the appetite right now for multifamily?

We are really not underway in any meaningful way on that initiative yet and as mentioned our guidance for 2009 really doesn’t depend on getting that fund done. I very much believe that there are going to be some terrific buying opportunities over the next couple of years in this distressed environment. If this is the kind of stuff that we do, I mean we find these kind of situations and we buy opportunistically and then we operate them back to pull value. I think that there is going to be capital out there, institutional capital that understands that, can appreciate that logic, and I’m confident and optimistic that we will get something done. But, in terms of actually engaging in direct conversations, we’ve not done that yet. We had started to do it late last year and frankly just backed off, and we thought we just let the markets kind of settle out for a while. But I’m hopeful that here within the next 90 days or so that we’re engaged in our process to really get a better feel for just how viable this initiative is. I’m convinced it’s there. I know the opportunity is there and I think that there is capital out there that understands that and more importantly understands what 2011 and beyond looks like for the multifamily industry. It looks incredibly strong. And I think that those who are in a position to both weather the downturn for the next couple of years and take advantage to the opportunities presented have a real opportunity in front of them. Michael Salinsky – RBC Capital Markets: Thanks guys.

Thank you.

Thank you, sir. Our next question is from Rob Stevenson of Fox-Pitt Kelton. Your line is open. Robert Stevenson – Fox Pitt Kelton: Good morning guys.

Hi Rob. Robert Stevenson – Fox Pitt Kelton: Eric, can you talk a little bit, I mean given your comments about dividend coverage, what’s your thoughts are about the dividend going forward and whether or not we are going to see some token increase? Whether or not you hold it flat to preserve capital in this type of environment? I mean what's the thought at this point from the Board?

Well we had a fair amount of conversation about it back in December and obviously felt appropriate at that time to hold it. In general, we've looked at a number of different scenarios. We've put a lot of stress modeling on our payout ratio and so forth. And just took a look at how bad things could get and before we start to have to make those kind of evaluations about the dividend. And, we believe things could get appreciably worse before we really have to start looking at any sort of action on the dividend. We think that the REIT model and a lot of our owners are in the stock believing that we're going to pay a dividend and we think that’s one of our responsibilities and have tried to build an earnings platform, a balance sheet around that responsibility. So, I would tell you that obviously if the economy continues to go through some sort of real downturn and we got into just a catastrophic scenario, we would take a look at everything including the dividend. But at this point we feel pretty good about it. And feel like that at this level we can sustain it just fine. I'm with doubt that in this environment there will be much of an appetite for raising the dividend. But we feel pretty comfortable of what we are doing right now. Robert Stevenson – Fox Pitt Kelton: What about paying part of it in the stock? Does things have to get worse before you would consider that or just as a course of business and some of the guys are starting to do that, would you do something like that, in the near-term to continuing to preserve additional cash?

No. We’ve not had that kind of conversation about paying in dividend and frankly don’t think that that really makes any sense for us at this point. We have got capacity on the balance sheet. We think we’ve got plenty of opportunity to pursue opportunities without having to take action with the dividend to preserve additional capital. I think that broadly speaking there could be situations with certain companies and certain balance sheets, where they run into NOI or net income number where they’ve got to make a dividend payment, in order to keep the REIT status and using stock as a currency may make sense in some cases. But we are not anywhere close to anything like that, and don’t perceive that. But I think as a general rule holding on if you were using your stock as currency at these prices in particular as a means of marshaling or holding cash in order to look for future growth opportunities, I don’t really endorse that model at all. Robert Stevenson – Fox Pitt Kelton: Okay. And then on the occupancy side I mean, it’s great that you guys were able to fight your way back up 70 basis points in January. Was that pretty much spread across all markets or were there one or two markets where you really saw the big increase?

Rob, we saw generally. This is Tom. By the way, but we saw the occupancy job from December to January was across the board, it weren't really any major recovery in one area or the other. Robert Stevenson – Fox Pitt Kelton: And that was just better traffic or a combination of better traffic and concessions?

And primarily it was better traffic, Rob. We had a nice uptick its up about 9.6%. So, primarily traffic we were encouraged by that. Robert Stevenson – Fox Pitt Kelton: Okay. And then lastly Eric and Simon, I mean, you guys were talking about in your guidance assumptions about the homeownership rate continuing to come down and that benefitting apartments. When you think about your markets right now, if the government wants a passing, something substantial here in terms of a tax incentive to buy housing plus does something with an interest rate buy down, whether or not its 2.99% or 3.99% or something alone those lines, which of your markets do you think have, a stable enough employment and people who might be thinking about moving out and buying a home in this type of environment and would be most impacted by that?

Rob, I would guess that you might see some of that pressure if it all plays out as you described in some of the bigger markets like in Atlanta or Dallas or Houston, where you tend to have these bigger, sort of starter home tracks that are out there. And my guess is that’s where if the government did come in and if you will once again artificially create a inducement some sort and starts allowing and putting people in the houses that really can't afford them, then I think that that maybe where the pressure builds much like we've seen over the last several years in some of the bigger markets like Phoenix and Vegas and Dallas and Houston. I think that’s where and some of the obvious down Florida, Tampa and Orlando some of those, but I think that and for us it’s always been an issue over the last several years, the fact that our renters did not have a down payment and frankly did not have the financial wherewithal to be able to afford a mortgage or being put into houses because they do have to come out with a down-payment and they offered all of these teaser rates, where essentially the mortgage payment was artificially low. I don’t think that some of the programs that are being discussed right now are going to actually kind of create that kind of scenario again. So, we are obviously monitoring what some of these programs that the government is talking about doing and I think that the correction back to a more normalized single family home ownership rate may impact the somewhat moderator meted by some of these actions the government is taking, but I think long term, we are still comfortable that the government understands and appreciates a balanced housing policy, balance between single-family and multifamily is a good thing for this country and I’m optimistic that we will continue to work in that direction. I don’t think we can fix it overnight. Robert Stevenson – Fox-Pitt Kelton: Thanks guys.

Thanks Rob.

Thank you. Our next question is from Nap Overton of Morgan and Keegan. Your line is open. Napoleon Overton – Morgan, Keegan & Company, Inc.: Yeah. Good morning. Couple of things, one in terms of the Fund II in this environment with significant opportunities expected to develop over the next 12 to 18 months. Would have you contemplated just retaining the upside of that benefit for yourself as opposed to trying to pursue a joint venture with the partner?

Well, our plan for our JV initiative is really geared towards targeting investment opportunities that we frankly would prefer to go invest in namely what we are targeting will be turnaround or value add place that we defined as assets being seven years of age or older. We think as a public platform that we do better for long-time public price in the company by keeping our focus up for 100% investments on newer assets and but yet over the years as a company one of our core competencies frankly is locating these opportunities underwriting the upside that’s there and then realizing it through the operations in the CapEx and other things that we’ve been executing on for 15 years. And but we don’t think it will be appropriate to go out and start buying a bunch of older assets that we would own a 100% of them, putting them on the public balance sheet. And of course, as you know, the JV model offers some alternatives in terms of how you approach to use the leverage and fee incomes and things of that nature, which has also created some pretty attractive returns to our shareholder capital. So, we see that initiative is really being a good complement to what we are doing for our own balance sheet and don’t believe there is any conflict issues, but and believe that the JV model is the right way to prosecute those other kind of opportunities I described.

I think one further point would be, Nap, is that, we like the leverage that we got on the balance sheet, right now and not really anxious to increase it in regard to private equity as a good source of equity particularly where considering where our stock price is trading. So, that adds if you like another arrow in our quiver in terms of our growth of the business. Napoleon Overton – Morgan, Keegan & Company, Inc.: Okay. And then one another question and that is if substantial opportunities were to develop, you wanted to take advantage of? What are those balance sheet and their capital structure considerations that would be the larger parameters for your capital structure beyond the immediate capacity that you have available under existing credit facilities?

Well the challenge of course is that, we do thing it’s a time to maintain modest leverage and your question is a good one, because these opportunities may present itself. Certainly, the opportunities would have to be hugely compelling for us to be willing to let go of any equity at the current pricing and so it’s certainly I think that if this downturn in the economy continues for a considerable time and there are compelling opportunities and our stock prices continues to be really depressed then I think that our frankly the way we will go about it would be to look at further partnering with other capital in order to choose the return sufficiently to give us what we need.

Yeah. And Nap, I mean there is definitely going to be some of those if you will portfolio opportunities, I mean we’ve already seen some and have looked at a number of them frankly over the last year and have continued to, the kind of numbers that would be required for us to be willing to take that kind of risk on right now, I don’t think that the market is there yet. But I think it maybe headed there. But putting the balance sheet at significant risk right now in order to get a deal done is not really what we do. I mean that’s just not our culture, it’s not the way we operate, and so I think that we would be compelled to look at a big opportunity. I mean, we would certainly pursue it if it were the right fit and the right opportunity and very compelling, but we would as part of that event I think we need to do in order to keep the balance sheet for being put at significant risk. We just don't think that's the right way to go about it. Napoleon Overton – Morgan, Keegan & Company, Inc.: Okay. Thanks very much.

Thank you. Our next question is from Carol Kemple of Hilliard Lyons. Your line is open. Carol Kemple – Hilliard Lyons: Okay. Thank you. Good morning guys.

Good morning.

Hi. Carol Kemple – Hilliard Lyons: I just had a couple of questions. You talked about the uptick in occupancy in January. Where were those new renters coming from? Were they leaving other apartments or why were they getting the lease?

Honestly, off the top of my head, we don’t have the source data for January this quickly at the end of month. So, I mean we've got traffic information. We’ll be reviewing back where the sources of traffic came from, but we don't this early in February we don’t have that analytical data to tell you these people moved out of the house and these folks came with new jobs. Carol Kemple – Hilliard Lyons: Okay.

If that make sense to you? Carol Kemple – Hilliard Lyons: Yeah. And then just my other question on your G&A and property management expense decline for 2009, do you expect that to be split pretty evenly between the four quarters or more heavily weighted than others?

I think it will be split fairly evenly. This is Al, Carol. Carol Kemple – Hilliard Lyons: Okay.

It will be a little heavier, but in the year just some items with increase the inflation, but fairly even. Carol Kemple – Hilliard Lyons: Okay. Okay. Great thank you.

Thank you. Our next question is from Paula Poskon of Robert Baird. Your line is open. Paula Poskon – Robert W. Baird & Co., Inc.: Thank you and good morning everyone.

Good morning.

Good morning, Paula. Paula Poskon – Robert W. Baird & Co., Inc.: So, in your guidance you've said that you are building your forecast on the assumption that the national unemployment rate will be somewhere between 8% and 8.5%. What do you think the sensitivity is around your guidance if unemployment goes to 10 or above this year?

Obviously, though trying to take these broad sort of economic metrics, unemployment metrics and applying them to our markets and then applying them to our sub-markets in our neighborhoods and our properties, a lot of different variables go on, but I can tell you that obviously if the economy were to fall off that much weaker, in a while would be, frankly fall off that much more and I can tell you as Al mentioned, we’ve modeled a lot more worst case scenarios in an effort to think about the balance sheet and think about the dividend and we think that we are in a position where we can weather materially worse decline from where we are right now and still, trudge along but why just goes that much more negative frankly. And how much more negative becomes a bit subjective trying to evaluate against our markets, but as I mean we continue to believe that some of these secondary markets will hold up a little better than some in the bigger cities. Paula Poskon – Robert W. Baird & Co., Inc.: Thanks that’s helpful. When we met at NAREIT, we talked a little bit about the LRO program and what information it kicks out to you and your ability to override that system. How is that its results or its recommendations how has that changed? And are you changing your approach in terms of overriding? What it’s telling you?

Hey Paula, it's Drew. LRO, I think in a weaker environment like we are in now with higher exposures and lower demand. Certainly, there is going to be some pressure on upfront pricing. And our strategy has been and what LRO does is to work to favor and protect occupancy over rents and that’s what we are seeing and that's sort of what we would expect the system to do.

Yeah. I’ll just add it quickly, Paula. This is a side note and because this comes up a lot. Well, LRO, or the Yield Management Systems to be as effective in a downturn as they are in a up part of the cycle and I continue to believe that the system will because we put an LRO believing that it will enable us to manage our revenue results better than we otherwise would be able to simply because we are able to gather more information, more market data, more insight on our own exposure regarding lease expiration. While we gather all those facts quicker, we are able to make a more informed decision and importantly we are able to make that decision faster. And I think the net result is that we generate better revenue results because we are making informed and better decisions, quicker decisions on the ground and that works whether it’s a downturn or whether it’s an upturn. Paula Poskon – Robert W. Baird & Co., Inc.: Okay. So, just a follow-up on that are you overriding what it’s telling you less than you had been?

No, well I don’t think we are overriding more or less. I think we don’t tend to override a lot anyway, but the volume of overriding if you will is not really gone up a lot.

And Paula that’s usually isolated, I mean we've often said with LRO it's not an excuse to turn off your brain. Paula Poskon – Robert W. Baird & Co., Inc.: Okay.

And LRO is going to try to fix things with price and if we know that the problem is, every now and then we make a mistake in on site. If we have made one it doesn’t make sense to fix that problem with price. It makes sense to fix the quality of the market right here or something like that. So, that’s where overrides generally come in is where we know something sort of LRO does in and we don’t want it to fix the problem with price. Paula Poskon – Robert W. Baird & Co., Inc.: Thank you, that’s helpful. And then could you give us just a little bit more color around your decision to make the accounting change around the transaction expenses and also the resegmentation of your markets from the three tiers to this primary and secondary?

Al, I want you to address the accounting question?

Okay. Well the accounting question is FAS 141R I mean just, we are required to beginning the year to go ahead and record transaction costs in our earnings.

We didn’t have a choice.

We didn’t have a choice. Paula Poskon – Robert W. Baird & Co., Inc.: Okay. For some reason I thought that there was a voluntary change?

No, not to my knowledge Paula Poskon – Robert W. Baird & Co., Inc.: Okay.

In fact, January 1 for us. So, that should be as we mentioned about $0.04 per share. Paula Poskon – Robert W. Baird & Co., Inc.: Right, okay.

It will happen probably towards the back half of the year obviously with the transactions that we’re talking about it. And I think on the segmentation, I think we just clarified or refined our segmentation in a way we felt better, it looks at the characteristics of our portfolio. And so what you have is in the primary markets, really you have markets that have populations that are a million above and that have investments of public REIT portfolios greater than 1%, and we felt like that was a good indicator of the gross margin.

Yeah, I mean quite frankly I think the terms we have had in the past that is sort of three tier definition is adding a level of detailed complexity that really is unnecessary I mean what we find is that its generally the secondary markets regardless of how small they may or may not be generally tend to perform somewhat aligned with each other and the large tier markets tend, so we just really felt that the added complexity was not really adding any value and the segmentation between primary and secondary just generally makes more sense, but then of course in our supplemental we detail out a lot of detail about, markets we have the larger concentrations. Paula Poskon – Robert W. Baird & Co., Inc.: That’s very helpful. Thanks guys.

Thanks Paula.

Thank you. Our next question is from Sheila Mcgrath of KBW. Your line is open. Sheila Mcgrath – Keefe, Bruyette & Woods: Good morning. I just was wondering if you could touch on Houston, are you seeing that market negatively impacted by lower energy pricing?

Not, not yet [Paula] I mean Houston on the revenue side, we are still seeing positive job growth, what we are monitoring a little bit there is just deliveries. Houston absorbed almost 12,000 units in 2008. We expect that number to drop to half so we're encouraged by that. But overall it’s been a positive story excluding obviously on the NOI side the Hurricane Ike charges. Sheila Mcgrath – Keefe, Bruyette & Woods: And Al, are there other markets that you are concerned about from the supply side like how is Austin looking?

Austin, I mean you've sort of answered, you stole my answer, Sheila. Yeah, Austin 4,500 units delivered this year, which is a sort of tight spot next year it's 9,500. So, we've got good job growth in Austin to offset it, we feel like we are well positioned there, but we are going to be monitoring the supply in Austin.

I mean Austin is clearly one of those markets that's going to get is a little bit an outlier in terms of supply, but fortunately that also is a market that tends to have stronger demand side story, I think it's associated with it. And so we think that that market while certainly will be weaker in '09 versus '08. We don’t see it as being a collapsed scenario there. Sheila Mcgrath – Keefe, Bruyette & Woods: Okay, great. And last question you did mention that GSEs, but I was just wondering if you could give us little more specifics on your conversations with them, and looking towards their kind of mandate to lower their balance sheet in 2010. What are you or other industry people are thinking about their appetite going forward?

Well I will sort of throw one comment and I think the way that I believe that they are planning to address this Sheila is by offering current and new programs that are off their balance sheet, that is where they guarantee or securitize mortgage-backed securities and I think Freddie has got number of initiatives in that regard Fannie has already has some. So, I think that’s how they are planning to deal with it. Certainly, we will be heard from the heads of both of the multi-family programs, where that they are aware of the capacity issues that will present themselves. And they are very committed to multi-family and do plan to address them in this manner. We will be meeting with Freddie and Fannie in the next 30 days, which we do once a year, and we discuss our business strategy with them and their strategy. But from what we heard things are well in hand and pretty positive. Sheila Mcgrath – Keefe, Bruyette & Woods: Okay, great. Thank you.

(Operator Instructions). And we have a question from Philip Martin of Cantor Fitzgerald. Your line is open. Philip Martin – Cantor Fitzgerald: Good morning.

Hey Philip.

Good morning. Philip Martin – Cantor Fitzgerald: I jumped on 25 minutes late, so if you've answered this I am happy to deal with it offline, but kind of a general question, but, at least from my analysis, your typical property seems to offer a nice blend of very nice amenities to newer products, it’s relatively affordable and it’s in affordable markets. To what extent is that giving you a bit of a competitive advantage in this market, I know job growth drive so much of multi-family demand certainly, but the affordability that the amenity package, the affordable markets, how much of a competitive advantage do you have versus your competition in a market like this. People have to live somewhere and not everybody is going to move back home with mom and dad, I mean I know I would hate to do that personally, but…

Well, I mean I do think that we may in fact have a little bit of an advantage in this cycle, and that as you point out I think we offer a very good value for the renter in that we do provide, I think generally in all the submarkets, in the markets where we compete. We tend to have one of the newer products, we have one of the newer portfolios in the REIT sector, and we and in our region of the country the newer products tends to sell very well. And, we are not in the downtown areas, we don’t have the heavy urban element to our portfolio. We are and frankly in our region of the country we are out where people really want to live, these are good school districts, good retail shopping, good amenities and the crime issues are lot less out in the suburbs, where we tend to have a lot of our assets, and I think that while I think we offer people a good value in this environment. So, we will see, but certainly during the last downturn as we did mention in the call that, the company did pretty well on a relative basis, and I think that may very well play out again this time. Philip Martin – Cantor Fitzgerald: And again you may have addressed this in the opening remarks, but are you seeing, are tenants I am sure coming to you and looking to negotiate rents et cetera just trying to stay in the property, just because they need to live somewhere, but they don't really want to move and how much of that are you seeing?

I mean we are seeing some of it, but the overall, we sent our offer out, we followup with it very quickly, we negotiate if needed and if pushed, but really and you can see it, I mean the inverse of our turnover rate is our retention rate. And our turnover rate is down and our retention rate is up. And we’re providing really sort of a better alternative for people than the substitute, for sure which is as you said, you don’t want to move back with your parents and not many folks are interested in buying a house right now. Philip Martin – Cantor Fitzgerald: Is your portfolio still in all or most of its markets still outperforming in terms of an occupancy standpoint. And then I don't know if you can calculate it or not, but even from an operating margin standpoint?

We track the best information we have is versus REITs and in that case we are significantly outperforming the REIT index of our, we do a composite of our markets and compare it to our actual occupancy and we’re outperforming that. Philip Martin – Cantor Fitzgerald: Okay, okay, okay. Thank you very much.

Thanks.

Thank you sir. Our next question is from Michael Salinsky of RBC Capital Markets. Michael Salinsky – RBC Capital Markets: Just sort of a follow-up question real quick. Can you talk about cap rates right now across your markets? I mean, how much your cap rates move in the past 90 days?

Well, it’s kind of hard to get a real read on that, any sort of definitive way, because frankly the transaction volume is so down right now and nothing has really been trading for the last 90 days. I think that the seller pricing probably is looking still for six maybe even sub-six that mid-six range and the buyers are wanting something well north of that and so you've got this sort of stalemate right now. Having said that we just sold a 25-year-old asset in Greensboro, North Carolina, which is by any definition I think a tertiary market. So, a 25-year-old asset in a tertiary market, sold for a 7, 7 cap rate, we've got two other assets, one here in Memphis, which is one of our older assets and one in Grenada, Mississippi, which is maybe sub-tertiary I don’t know but it’s, we've got those both on a contract at 6, 6 cap rate. So, I think that it’s hard to know exactly how they've moved in a broad sense right now, but, clearly buyers are looking for a better deal and we think that its likely that the cap rates are in general, when the transaction line picks up are going to show, something probably approaching somewhere between 6.5 and 7, maybe a little higher than that. I don’t know. It will vary quite a bit. Michael Salinsky – RBC Capital Markets: What does the buyer contingent look like right now?

I’m sorry the buyer contingent? Michael Salinsky – RBC Capital Markets: Yeah. I mean where is the people that are out there actively bidding on these properties I mean what is the?

There is a lot of, I mean, some of the private capital buyers that have some of these funds are out there and we that's usually who we’re running into right now as some of the smaller guys, who have got money that they are representing somebody else on, kind of the vulture buyer kind of mindset is sort of out there right now?

I think there is still plenty of people out there, Mike because they see what we see and that is that 2011, ‘12 look pretty incredible for the multi-family sector. So, the lot of people that appreciate that, but there is as they are excess there is just big ad spread right now. Everybody is kind of waiting to see what happens. And that’s been going for a while may continue for another three or six months I don’t know we are beginning to see more signs of sort of stress with some of these over leveraged portfolios with mezz debt or bridge debt that’s not being able to be handled and that make cause a bit of a break, we’ll see, but there is still plenty of buys and of course the agencies out there, willing to finance as sensibility underwritten deal. And they are certainly not giving their money away and there is certainly underwriting as they always has done in my view, in an intelligent manner, but it’s, so we, I think the deals will be out there but its maybe just a little while yet.

Haven’t seen any a shift in focus, I mean is it still primarily on the value added or have you seen a shift back to quality?

Well, I think what we are seeing most of the transactions that are clearing right now are taking place at the lower end of the quality scale, kind of the C quality, B quality assets, B- minus assets that's where you're starting to see more transaction volume phase pickup as a result of I mean frankly I think that’s where most of the financing stress is currently the upper end product quality, which is where we are focusing our efforts on we haven't seen that’s where the bid-ask is still pretty heavy and the transaction volume is really just not there.

Okay. Thank you very much.

Thanks Mike.

Thank your. Our next question is from Rich Anderson. Sir your line is open. Richard Anderson – BMO Capital Markets: Thanks and good morning. Sorry, I got in the queue earlier, but I think I got blackballed there might have been [because].

Yeah. We gave special instruction.

We are just glad it's the real, Rich Anderson Richard Anderson – BMO Capital Markets: Well I got in the queue as [Bruce Springsteen] that might have been the reason. So, now we know that the people are doing their job and filling their job for you, so anyway. Just couple of quick questions the 20% floating rate debt, is that a level you are comfortable with or could you see that may be come down now with rates being where they are, would you consider that?

We are Rich it's good, great question and as we move into 2009 forecast, we expect our 80% to move down a little bit, and it will go down maybe come backup as we end the year, trying to take care some of the transaction that come due end of the year. We expect about 78% to 80% average for 2009. We do have to put a point there another 6% cap, which we only have 14% of our debt just totally unhedged. So, we are benefiting from the low floating rate of a whole 20 with the hedge from our 60% that an important point I think. Richard Anderson – BMO Capital Markets: Okay. And Simon you mentioned the $0.80 annual impact from the reprising of the swap and other factors right, but it's only $0.01 in 2008. Can you explain why it's happening in April?

Right. Well there were really two tranches one is a swap that matures April 1. And there is lot more $65 million of REIT prices December 1. Richard Anderson – BMO Capital Markets: Okay.

And that’s the high interest rate while really where we really get juice is on that December 1 maturity? Richard Anderson – BMO Capital Markets: Okay. I know you have a lot of, you have a line-up of swap expirations in the forward years what is it in 2010 that you have expiring?

A $140 million, in swaps Rich, $148 million in total of everything. Richard Anderson – BMO Capital Markets: 140, okay, great. Real quickly Eric you mentioned lower CapEx for 2009 is that a smart thing to do in this environment and potentially incurring some deferred maintenance?

Well we are not incurring any deferred maintenance, we've maintained very active CapEx program for 15 years and properties are in terrific shape. And we go through various cycles sometimes where paint jobs and other things tend to be a little higher and the numbers can move around a little bit, but Drew you want to add something to that.

Yeah. I was just going to say we are planning the same level of recurring CapEx next year that we planned this year is slightly less on the revenue enhancing and I think as Eric mentioned significantly less on the redevelopment. Richard Anderson – BMO Capital Markets: Okay. On the accounting change FAS 141R is not a new pronouncement, I am curious why didn’t you have these expenses in 2008?

The implementation is required for January 1 of this year, Rich. Richard Anderson – BMO Capital Markets: Of this expense elements to the year?

And put the expense the brokerage and accounting cost or the legal cost something in earnings instead of being capitalized into the deal. Richard Anderson – BMO Capital Markets: Okay. And they will show up in operating expenses I assume?

They will, show up, yes they will show up in G&A.

Probably be in G&A. Richard Anderson – BMO Capital Markets: G&A, excuse me.

Yeah. Richard Anderson – BMO Capital Markets: Okay. And then lastly you are looking to Texas as a couple of good markets for 2009. I mean how long can that hold up when you consider, oil prices and some other factors, I mean does Texas have the fire power to stay at top market for you throughout the year?

I mean Rich, for ’09 those are the strongest markets that are out there. They are all positive and honestly in terms of job growth for forecast for 2009. Are they going to add 10% new jobs or 4% new jobs absolutely not, but on a relative basis, they will be our strongest markets. And then we will monitor a little bit, we will monitor the new construction there and as I mentioned Austin is up a little, but Houston's number drops in half. So, and I think we'll still continue to see some job growth out there, which compared to the rest of the country these days are pretty darn and good. Richard Anderson – BMO Capital Markets: Okay, good thanks. I appreciated it. Good call.

Thanks Rich.

Thank you. Our final question in the queue is from Cassandra Kimberly of Commercial Appeal. Your line is open. Cassandra Kimberly – Commercial Appeal: Hi, good morning everyone.

Good morning.

Good morning, Cassandra. Cassandra Kimberly – Commercial Appeal: Hey, I was hoping that you could speak directly to the Memphis market for a second, how are we faring compared to the other markets that you're in?

In terms of our portfolio Cassandra to the Memphis market and I think you're relatively familiar with it. Our occupancy and our revenue levels are significantly higher than the market right now. Cassandra Kimberly – Commercial Appeal: Okay, great. And is this just due to the properties that you all are just maintaining then and being higher quality or what would attribute this to?

I would certainly credit the asset management, property management teams and how we operate properties. But again your familiarity with Memphis it's our location as well we've picked up submarkets very carefully. We've limited our exposure to the areas in the South of Memphis that has been tougher over the last 10 years and so it's really a combination of Mid-America's sort of people practices and then its location of its product.

Great. All right. Wonderful well thank you very much. I appreciate it.

Thanks Cassandra

Thank you.

Thank you.

Thank you, sir. I show no further questions in the queue. Please proceed with any further remarks.

No further remarks. Thanks for being on the call. Thanks.

Ladies and gentlemen thank you for your participation in today's conference. This does conclude the program. You may now disconnect and have a wonderful day.