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Post Properties Announces Fourth Quarter 2012 Earnings



  Post Properties Announces Fourth Quarter 2012 Earnings

 Investor/Analyst Conference Call Scheduled for Tuesday, February 5 at 10:00
                                   a.m. ET

Business Wire

ATLANTA -- February 4, 2013

Post Properties, Inc. (NYSE: PPS) announced today net income available to
common shareholders of $17.9 million, or $0.33 per diluted share, for the
fourth quarter of 2012, compared to net income of $3.0 million, or $0.06 per
diluted share, for the fourth quarter of 2011.

Net income available to common shareholders for the year ended December 31,
2012 was $80.3 million, or $1.48 per diluted share, compared to net income of
$19.3 million, or $0.38 per diluted share, for the year ended December 31,
2011.

The Company’s net income available to common shareholders for the three months
ended December 31, 2012 included a loss on the early extinguishment of
indebtedness of $4.0 million. In addition, the Company’s net income available
to common shareholders for the year ended December 31, 2012 included a gain of
$6.1 million on the sale of an asset.

The Company’s net income available to common shareholders for the three months
and year ended December 31, 2011 included a loss on the early extinguishment
of indebtedness of $6.9 million. In addition, the Company’s net income
available to common shareholders for the year ended December 31, 2011 included
$1.8 million of costs associated with the Company’s redemption of preferred
stock.

Funds From Operations

The Company uses the National Association of Real Estate Investment Trusts
(“NAREIT”) definition of Funds from Operations (“FFO”) as an operating measure
of the Company’s financial performance. A reconciliation of FFO to GAAP net
income is included in the financial data (Table 1) accompanying this press
release.

FFO for the fourth quarter of 2012 was $38.8 million, or $0.71 per diluted
share, compared to $20.9 million, or $0.40 per diluted share, for the fourth
quarter of 2011. FFO for the fourth quarter of 2012 included the loss on the
early extinguishment of indebtedness discussed above totaling $4.0 million, or
$0.07 per diluted share. FFO for the fourth quarter of 2011 included the loss
on early extinguishment of indebtedness discussed above totaling $6.9 million,
or $0.13 per diluted share.

FFO for the year ended December 31, 2012 was $154.3 million, or $2.84 per
diluted share, compared to $93.7 million, or $1.83 per diluted share, for the
year ended December 31, 2011. FFO for the year ended December 31, 2012
included losses on the early extinguishment of indebtedness of $4.3 million,
or $0.08 per diluted share. FFO for the year ended December 31, 2011 included
the loss on the early extinguishment of indebtedness and the costs related to
the redemption of preferred stock, discussed above, totaling a net reduction
to FFO of $8.7 million, or $0.17 per diluted share.

Said Dave Stockert, Post’s CEO, “Strong results in the fourth quarter capped a
very productive year. Per share core funds from operations grew by more than
20% in 2012, driven by excellent portfolio performance and opportunistic
investing and financing activity. In addition, we achieved a robust pace of
condominium closings. The Company enters the new year well positioned to
continue growing its core funds from operations. We expect to see ongoing
favorable apartment market conditions, and look forward to the bottom-line
contribution of our communities in lease-up.”

Same Store Community Data

Average economic occupancy at the Company’s 50 same store communities,
containing 18,114 apartment units, was 95.6% and 95.9% for the fourth quarter
of 2012 and 2011, respectively.

Total revenues for the same store communities increased 5.8% and total
operating expenses increased 7.7% during the fourth quarter of 2012, compared
to the fourth quarter of 2011, resulting in a 4.7% increase in same store net
operating income (“NOI”). The average monthly rental rate per unit increased
5.9% during the fourth quarter of 2012, compared to the fourth quarter of
2011.

On a sequential basis, total revenues for the same store communities decreased
0.8% and total operating expenses decreased 4.5%, producing a 1.5% increase in
same store NOI for the fourth quarter of 2012, compared to the third quarter
of 2012. On a sequential basis, the average monthly rental rate per unit
increased 0.9%. For the fourth quarter of 2012, average economic occupancy at
the same store communities was 95.6%, compared to 96.6% for the third quarter
of 2012.

For the year ended December 31, 2012, average economic occupancy at the
Company’s same store communities was 96.0%, compared to 95.6% for the year
ended December 31, 2011.

Total revenues for the same store communities increased 7.0% and total
operating expenses increased 4.4% during 2012, compared to 2011, resulting in
a 8.7% increase in same store NOI. The average monthly rental rate per unit
increased 6.2% for 2012, compared to 2011.

Same store NOI is a supplemental non-GAAP financial measure. A reconciliation
of same store NOI to the comparable GAAP financial measure is included in the
financial data (Table 2) accompanying this press release. Information on same
store NOI and average rental rate per unit by geographic market is also
included in the financial data (Table 3) accompanying this press release.

Development Activity

In December 2012, the Company acquired development land in Austin, Texas,
adjacent to its Post South Lamar™ development community, for an aggregate
price of approximately $8.5 million. This approximately 3-acre site is
expected to be redeveloped in the future to include, subject to revision,
approximately 300 luxury apartment units and approximately 7,000 square feet
of retail space.

In the aggregate, the Company has 2,046 units in seven apartment communities,
and approximately 45,085 square feet of retail space, under development or in
lease-up with a total estimated cost of $338.2 million. The Company currently
expects to utilize available cash, available borrowings under its unsecured
bank credit facilities, or other indebtedness, as well as net proceeds from
its on-going condominium sales and its at-the-market common equity sales
program to fund future estimated construction expenditures.

In 2012, the Company began leasing units at three of its development
communities: the second phase of its Post Carlyle Square™ apartment community
located in Washington D.C., its Post South Lamar™ apartment community located
in Austin, Texas, and at the third phase of its Post Midtown Square® apartment
community in Houston, Texas. As of February 2, 2013, Post Carlyle Square™ –
Phase II, Post South Lamar™ and Post Midtown Square® - Phase III were 52.9%,
44.0% and 49.2% leased, respectively.

Financing Activity

Leverage, Line and Term Loan Capacity

Total debt and preferred equity as a percentage of undepreciated real estate
assets (adjusted for joint venture partners’ share of real estate assets and
debt) was 38.5% at December 31, 2012.

In October 2012, the Company prepaid $53.0 million of 5.50% secured debt at
par. The mortgage debt was scheduled to mature in early 2013.

In November 2012, the Company took advantage of recent upgrades to its
corporate credit ratings to issue $250.0 million of senior unsecured notes
bearing interest at 3.375% and due in 2022.

In December 2012, the Company prepaid $130.1 million of 6.30% senior unsecured
notes. The notes were scheduled to mature in mid-2013. In connection with the
prepayment, the Company recognized an extinguishment loss of $4.0 million
related to the prepayment premiums and the write-off of unamortized deferred
loan costs.

As of February 1, 2013, the Company had cash and cash equivalents of $83.0
million. Additionally, the Company had no outstanding borrowings, and letters
of credit totaling $0.6 million under its combined $330 million unsecured
lines of credit. The Company has no principal debt maturities in either 2013
or 2014.

Computations of debt ratios and reconciliations of the ratios to the
appropriate GAAP measures in the Company’s financial statements are included
in the financial data (Table 4) accompanying this press release.

At-the-Market Common Equity Activity

The Company has available an at-the-market (“ATM”) common equity program that
provides for the sale of up to 4 million shares of common stock. Through the
fourth quarter and as of February 1, 2013, no shares have been issued under
that program. The Company expects to continue to use its ATM program as an
additional source of capital and liquidity, to maintain the strength of its
balance sheet and to fund its future investment activities. Sales under this
program are dependent upon a variety of factors, including, among others,
market conditions, the trading price of the Company’s common stock, the
Company’s liquidity position and the potential use of proceeds.

Condominium Activity

During the fourth quarter of 2012, the Company closed 27 condominium units at
its Austin and Atlanta condominium projects for aggregate gross revenue of
$25.7 million. For the full year 2012, the Company closed 96 condominium units
for aggregate gross proceeds of $89.7 million. As of February 1, 2013, the
Company has, in the aggregate, closed 214 units at the Austin and Atlanta
condominium projects and has 16 units under contract. There can be no
assurance that condominium units under contract will close.

The Company recognized net gains in FFO of $10.6 million, or $0.19 per diluted
share, from condominium sales activities during the fourth quarter of 2012,
compared to $0.8 million, or $0.015 per diluted share, during the fourth
quarter of 2011.

2013 Outlook

The estimates and assumptions presented below are forward looking and are
based on the Company’s future view of the apartment and condominium markets
and of general economic conditions, as well as other risks outlined below
under the caption “Forward-Looking Statements.” There can be no assurance that
the Company’s actual results will not differ materially from the estimates set
forth below. The Company assumes no obligation to update this guidance in the
future.

Based on its current outlook, the Company anticipates that FFO per diluted
share for the full year 2013 will be in the range set forth below. The tables
below reflect anticipated net gains from condominium sales (for purposes of
this discussion, "Condo FFO") and FFO before Condo FFO (for purposes of this
discussion, "Core FFO").

                                   Current
                                  
                                   Outlook
Core FFO                           $2.46 - $2.56
Condo FFO                          $0.20 - $0.37
FFO                                $2.66 - $2.93
                                    
                                   Current
Same Store Assumptions
                                   Outlook
Revenue                            4.25% - 5.25%
Operating expenses                 4.25% - 5.25%
Net operating income (NOI)         4.00% - 5.50%

The above estimates of FFO per diluted share are also based on the following
assumptions:

  * Projected net operating income from lease up activities, net of operating
    deficits, expected to contribute approximately $0.13 per diluted share at
    the mid-point of the estimated range of Core FFO;
  * Projected development expenditures of approximately $125 million in 2013,
    including planned development starts in the latter half of the year,
    funded with available cash, retained cash flow and net proceeds from
    condominium sales;
  * Projected decrease in capitalized interest and development overhead costs,
    expected to cause Core FFO to decline by approximately $0.05 per diluted
    share in 2013, offset in large part by decreased interest expenditures
    resulting from 2012 refinancing activities;
  * In the aggregate, projected 3-4% increase in general and administrative
    expenses, corporate property management expenses and investment and
    development expenses (gross of amounts capitalized to development
    projects), including expenses relating to planned information technology
    systems upgrades in 2013;
  * Decreases in interest and other income (specifically, litigation
    settlements, tax increment financing interest and technology investment
    gains that were realized in 2012) that are expected to cause miscellaneous
    income to decline by approximately $0.03 per diluted share in 2013; and
  * Projected weighted average diluted shares of approximately 55.1 million
    for the full year 2013, with no share issuance under the Company’s ATM
    program required to fund the investment activity included in the Company’s
    guidance.

The Company anticipates that net income available to common shareholders will
be in the range of $1.05 to $1.35 per diluted share for 2013. The difference
between net income available to common shareholders and FFO per diluted share
is depreciation on real estate assets, which is anticipated to be $1.58 to
$1.61 per diluted share for 2013.

Supplemental Financial Data

The Company also produces Supplemental Financial Data that includes detailed
information regarding the Company’s operating results, investment activity,
financing activity, balance sheet and properties. This Supplemental Financial
Data is considered an integral part of this earnings release and is available
on the Company’s website. The Company’s Earnings Release and the Supplemental
Financial Data are available through the For Investors/Financial
Reports/Quarterly and Other Reports section of the Company’s website at
www.postproperties.com.

The ability to access the attachments on the Company’s website requires the
Adobe Acrobat Reader, which may be downloaded at http://get.adobe.com/reader/.

Non-GAAP Financial Measures and Other Defined Terms

The Company uses certain non-GAAP financial measures and other defined terms
in this press release and in its Supplemental Financial Data available on the
Company’s website. The non-GAAP financial measures include FFO, Adjusted Funds
from Operations (“AFFO”), net operating income, same store capital
expenditures, and certain debt statistics and ratios. The definitions of these
non-GAAP financial measures are listed below and on page 19 of the
Supplemental Financial Data. The Company believes that these measures are
helpful to investors in measuring financial performance and/or liquidity and
comparing such performance and/or liquidity to other REITs.

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

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

Adjusted Funds From Operations – The Company also uses AFFO as an operating
measure. AFFO is defined as FFO less operating capital expenditures and after
adjusting for the impact of non-cash straight-line, long-term ground lease
expense, non-cash impairment charges, debt extinguishment gains (losses) and
preferred stock redemption costs. The Company believes that AFFO is an
important supplemental measure of operating performance for an equity REIT
because it provides investors with an indication of the REIT’s ability to fund
its operating capital expenditures through earnings. In addition, since most
equity REITs provide AFFO information to the investment community, the Company
believes that AFFO is a useful supplemental measure for comparing the Company
to other equity REITs. The Company believes that the line on its consolidated
statement of operations entitled “net income available to common shareholders”
is the most directly comparable GAAP measure to AFFO.

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

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

Debt Statistics and Debt Ratios – The Company uses a number of debt statistics
and ratios as supplemental measures of liquidity. The numerator and/or the
denominator of certain of these statistics and/or ratios include non-GAAP
financial measures that have been reconciled to the most directly comparable
GAAP financial measure. These debt statistics and ratios include: (1) interest
coverage ratios; (2) fixed charge coverage ratios; (3) total debt as a
percentage of undepreciated real estate assets (adjusted for joint venture
partner’s share of debt); (4) total debt plus preferred equity as a percentage
of undepreciated real estate assets (adjusted for joint venture partner’s
share of debt); (5) a ratio of consolidated debt to total assets; (6) a ratio
of secured debt to total assets; (7) a ratio of total unencumbered assets to
unsecured debt; (8) a ratio of consolidated income available for debt service
to annual debt service charge; and (9) a debt to annualized income available
for debt service ratio. A number of these debt statistics and ratios are
derived from covenants found in the Company’s debt agreements, including,
among others, the Company’s senior unsecured notes. In addition, the Company
presents these measures because the degree of leverage could affect the
Company’s ability to obtain additional financing for working capital, capital
expenditures, acquisitions, development or other general corporate purposes.
The Company uses these measures internally as an indicator of liquidity, and
the Company believes that these measures are also utilized by the investment
and analyst communities to better understand the Company’s liquidity.

The Company uses income available for debt service to calculate certain debt
ratios and statistics. Income available for debt service is defined as net
income (loss) before interest, taxes, depreciation, amortization, gains on
sales of real estate assets, non-cash impairment charges and other non-cash
income and expenses. Income available for debt service is a supplemental
measure of operating performance that does not represent and should not be
considered as an alternative to net income or cash flow from operating
activities as determined under GAAP, and the Company’s calculation thereof may
not be comparable to similar measures reported by other companies, including
EBITDA or Adjusted EBITDA.

Property Operating Statistics – The Company uses average economic occupancy,
gross turnover, net turnover and percentage increases in rent for new and
renewed leases as statistical measures of property operating performance. The
Company defines average economic occupancy as gross potential rent less
vacancy losses, model expenses and bad debt expenses divided by gross
potential rent for the period, expressed as a percentage. Gross turnover is
defined as the percentage of leases expiring during the period that are not
renewed by the existing residents. Net turnover is defined as gross turnover
decreased by the percentage of expiring leases where the residents transfer to
a new apartment unit in the same community or in another Post® community. The
percentage increases in rent for new and renewed leases are calculated using
the respective new or renewed rental rate as of the date of a new lease, as
compared with the previous rental rate on that same unit.

Conference Call Information

The Company will hold its quarterly conference call on Tuesday, February 5, at
10:00 a.m. ET. The telephone numbers are 888-359-3627 for US and Canada
callers and 719-457-2727 for international callers. The access code is
1040991. The conference call will be open to the public and can be listened to
live on Post’s website at www.postproperties.com under For Investors/Event
Calendar. The replay will begin at 1:00 p.m. ET on Tuesday, February 5, and
will be available until Monday, February 11, at 11:59 p.m. ET. The telephone
numbers for the replay are 888-203-1112 for US and Canada callers and
719-457-0820 for international callers. The access code for the replay is
1040991. A replay of the call also will be archived on Post’s website under
For Investors/Audio Archives.

About Post

Post Properties, founded more than 40 years ago, is a leading developer and
operator of upscale multifamily communities. The Company’s mission is
delivering superior satisfaction and value to its residents, associates, and
investors, with a vision of being the first choice in quality multifamily
living. Operating as a real estate investment trust (“REIT”), the Company
focuses on developing and managing Post® branded resort-style garden and high
density urban apartments. Post Properties is headquartered in Atlanta,
Georgia, and has operations in ten markets across the country.

Post Properties has interests in 22,218 apartment units in 60 communities,
including 1,471 apartment units in four communities held in unconsolidated
entities and 2,046 apartment units in seven communities currently under
development or in lease-up. The Company is also selling luxury for-sale
condominium homes in two communities through a taxable REIT subsidiary.

Forward-Looking Statements

Certain statements made in this press release and other written or oral
statements made by or on behalf of the Company, may constitute
“forward-looking statements” within the meaning of the federal securities
laws. Statements regarding future events and developments and the Company’s
future performance, as well as management’s expectations, beliefs, plans,
estimates or projections relating to the future, are forward-looking
statements within the meaning of these laws. Examples of such statements in
this press release include, expectations regarding apartment market
conditions, expectations regarding use of proceeds from unsecured bank credit
facilities, expectations regarding future operating conditions, including the
Company’s current outlook as to expected funds from operations, revenue,
operating expenses and net operating income, anticipated development
activities (including projected construction expenditures and timing),
expectations regarding the for-sale condominium business, and expectations
regarding offerings of the Company’s common stock and the use of proceeds
thereof. All forward-looking statements are subject to certain risks and
uncertainties that could cause actual events to differ materially from those
projected. Management believes that these forward-looking statements are
reasonable; however, you should not place undue reliance on such statements.
These statements are based on current expectations and speak only as of the
date of such statements. The Company undertakes no obligation to publicly
update or revise any forward-looking statement, whether as a result of future
events, new information or otherwise.

The following are some of the factors that could cause the Company’s actual
results and its expectations to differ materially from those described in the
Company’s forward-looking statements: the success of the Company’s business
strategies discussed in its Annual Report on Form 10-K for the year ended
December 31, 2011 and in subsequent filings with the SEC; conditions affecting
ownership of residential real estate and general conditions in the
multi-family residential real estate market; uncertainties associated with the
Company’s real estate development and construction; uncertainties associated
with the timing and amount of apartment community sales; exposure to economic
and other competitive factors due to market concentration; future local and
national economic conditions, including changes in job growth, interest rates,
the availability of mortgage and other financing and related factors; the
Company’s ability to generate sufficient cash flows to make required payments
associated with its debt financing; the effects of the Company’s leverage on
its risk of default and debt service requirements; the impact of a downgrade
in the credit rating of the Company’s securities; the effects of a default by
the Company or its subsidiaries on an obligation to repay outstanding
indebtedness, including cross-defaults and cross-acceleration under other
indebtedness; the effects of covenants of the Company’s or its subsidiaries’
mortgage indebtedness on operational flexibility and default risks; the
effects of any decision by the government to eliminate Fannie Mae or Freddie
Mac or reduce government support for apartment mortgage loans; the Company’s
ability to maintain its current dividend level; uncertainties associated with
the Company’s condominium for-sale housing business, including the timing and
volume of condominium sales; the impact of any additional charges the Company
may be required to record in the future related to any impairment in the
carrying value of its assets; the impact of competition on the Company’s
business, including competition for residents in the Company’s apartment
communities and buyers of the Company’s for-sale condominium homes and
development locations; the Company’s ability to compete for limited investment
opportunities; the effects of changing interest rates and effectiveness of
interest rate hedging contracts; the success of the Company’s acquired
apartment communities; the Company’s ability to succeed in new markets; the
costs associated with compliance with laws requiring access to the Company’s
properties by persons with disabilities; the impact of the Company’s ongoing
litigation with the U.S. Department of Justice regarding the Americans with
Disabilities Act and the Fair Housing Act as well as the impact of other
litigation; the effects of losses from natural catastrophes in excess of
insurance coverage; uncertainties associated with environmental and other
regulatory matters; the costs associated with moisture infiltration and
resulting mold remediation; the Company’s ability to control joint ventures,
properties in which it has joint ownership and corporations and limited
partnership in which it has partial interests; the Company’s ability to renew
leases or relet units as leases expire; the Company’s ability to continue to
qualify as a REIT under the Internal Revenue Code; and the effects of changes
in accounting policies and other regulatory matters detailed in the Company’s
filings with the Securities and Exchange Commission; increased costs arising
from health care reform; any breach of the Company’s privacy or information
security systems. Other important risk factors regarding the Company are
included under the caption “Risk Factors” in the Company’s Annual Report on
Form 10-K for the year ended December 31, 2011 and may be discussed in
subsequent filings with the SEC. The risk factors discussed in Form 10-K under
the caption “Risk Factors” are specifically incorporated by reference into
this press release.

Financial Highlights
(Unaudited; in thousands, except per share and unit amounts)
                                                      
                             Three months ended        Year ended
                             December 31,              December 31,
                             2012       2011           2012          2011
OPERATING DATA
Total revenues               $ 86,101   $ 77,749       $ 334,911     $ 305,316
Net income available to      $ 17,931   $ 2,979        $ 80,251      $ 19,254
common shareholders
Funds from operations
available to common
shareholders and             $ 38,828   $ 20,911       $ 154,349     $ 93,664
unitholders (Table 1)
                                                                      
Weighted average shares        54,518     52,435         54,131        50,808
outstanding - diluted
Weighted average shares
and units outstanding -        54,661     52,592         54,278        50,972
diluted
                                                                      
PER COMMON SHARE DATA -
DILUTED
Net income available to      $ 0.33     $ 0.06         $ 1.48        $ 0.38
common shareholders
                                                                      
Funds from operations
available to common
shareholders and             $ 0.71     $ 0.40         $ 2.84        $ 1.83
unitholders (Table 1) (1)
                                                                      
Dividends declared           $ 0.25     $ 0.22         $ 0.97        $ 0.84
                                                                      

1) Funds from operations available to common shareholders and unitholders per
share was computed using weighted average shares and units outstanding,
including the impact of dilutive securities totaling 218 and 359 for the three
months and 310 and 388 for the year ended December 31, 2012 and 2011,
respectively. Additionally, diluted weighted average shares and units included
the impact of non-vested shares and units totaling 129 and 162 for the three
months and 127 and 162 for the year ended December 31, 2012 and 2011,
respectively, for the computation of FFO per share. Such non-vested shares and
units are considered in the income per share computations under GAAP using the
“two-class method.”

Table 1
Reconciliation of Net Income Available to Common Shareholders to
Funds From Operations Available to Common Shareholders and Unitholders
(Unaudited; in thousands, except per share amounts)
                                                                  
                      Three months ended             Year ended
                      December 31,                   December 31,
                      2012          2011             2012          2011
Net income
available to          $ 17,931      $ 2,979          $ 80,251      $ 19,254
common
shareholders
Noncontrolling
interests -             42            8                217           62
Operating
Partnership
Depreciation on
consolidated real       20,566        18,538           78,737        73,878
estate assets,
net
Depreciation on
real estate
assets held in
unconsolidated          289           363              1,199         1,447
entities
Gains on sales of       (10,578 )     (1,757 )         (36,273 )     (10,514 )
condominiums
Incremental gains
on condominium          10,578        780              36,273        9,537
sales
Gains on sales of
depreciable real
estate assets -
unconsolidated          -             -                (6,055  )     -        
entities
Funds from
operations
available to
common
shareholders and      $ 38,828      $ 20,911         $ 154,349     $ 93,664   
unitholders
                                                                    
Funds from
operations - per      $ 0.71        $ 0.40           $ 2.84        $ 1.83     
share and unit -
diluted (1)
Weighted average
shares and units        54,790        52,754           54,405        51,134   
outstanding -
diluted (1)
                                                                              

1) Diluted weighted average shares and units include the impact of dilutive
securities totaling 218 and 359 for the three months and 310 and 388 for the
year ended December 31, 2012 and 2011, respectively. Additionally, diluted
weighted average shares and units included the impact of non-vested shares and
units totaling 129 and 162 for the three months and 127 and 162 for the year
ended December 31, 2012 and 2011, respectively, for the computation of FFO per
share. Such non-vested shares and units are considered in the income per share
computations under GAAP using the “two-class method.”

Table 2
Reconciliation of Same Store Net Operating Income (NOI) to GAAP Net Income
(Unaudited; In thousands)
                                                                            
                 Three months ended                            Year ended
                 December      December      September         December      December
                 31,           31,           30,               31,           31,
                 2012          2011          2012              2012          2011
Total same       $ 47,890      $ 45,752      $ 47,185          $ 186,343     $ 171,499
store NOI
Property NOI
from other         1,529         (204    )     1,639             4,040         489      
operating
segments
Consolidated       49,419        45,548        48,824            190,383       171,988  
property NOI
Add
(subtract):
Interest           34            39            20                393           1,021
income
Other revenues     213           232           209               850           918
Depreciation       (20,973 )     (18,880 )     (20,334 )         (80,145 )     (75,263 )
Interest           (11,855 )     (13,672 )     (11,816 )         (46,419 )     (56,791 )
expense
Amortization
of deferred        (669    )     (712    )     (667    )         (2,695  )     (2,797  )
financing
costs
General and        (4,411  )     (3,768  )     (3,763  )         (16,342 )     (16,100 )
administrative
Investment and     (312    )     (148    )     (203    )         (1,317  )     (1,161  )
development
Other
investment         (242    )     (157    )     (547    )         (1,401  )     (1,435  )
costs
Gains on
condominium
sales              10,578        1,757         10,261            36,273        10,514
activities,
net
Equity in
income of
unconsolidated
real estate        579           211           475               7,995         1,001
entities, net
Other income       590           389           (137    )         1,034         619
(expense), net
Net loss on
extinguishment     (4,017  )     (6,919  )     -                 (4,318  )     (6,919  )
of
indebtedness
                                                                              
Net income       $ 18,934      $ 3,920       $ 22,322          $ 84,291      $ 25,595   
                                                                                        

Table 3
Same Store Net Operating Income (NOI) and Average Rental Rate per Unit by Market
(In thousands)
                                                                          
                Three months ended                  Q4 '12    Q4 '12       Q4 '12
                December   December   September     vs. Q4    vs. Q3       % Same
                31,        31,        30,           '11       '12
                2012       2011       2012          %         % Change     Store
                                                    Change                 NOI
Rental and
other
revenues
Atlanta         $ 20,807   $ 19,688   $  20,982     5.7  %    (0.8  )%
Washington,       13,180     12,691      13,283     3.9  %    (0.8  )%
D.C.
Dallas            15,989     15,018      16,261     6.5  %    (1.7  )%
Tampa             8,851      8,314       8,851      6.5  %    0.0   %
Charlotte         4,930      4,618       5,013      6.8  %    (1.7  )%
New York          3,704      3,585       3,709      3.3  %    (0.1  )%
Houston           3,453      3,189       3,446      8.3  %    0.2   %
Orlando           2,778      2,592       2,777      7.2  %    0.0   %
Austin            2,823      2,630       2,845      7.3  %    (0.8  )%
Total rental
and other         76,515     72,325      77,167     5.8  %    (0.8  )%
revenues
                                                                            
Property
operating and
maintenance
expenses
(exclusive of
depreciation
and
amortization)
Atlanta           8,280      7,579       8,569      9.2  %    (3.4  )%
Washington,       4,147      3,818       4,157      8.6  %    (0.2  )%
D.C.
Dallas            6,296      6,062       6,996      3.9  %    (10.0 )%
Tampa             3,169      2,998       3,275      5.7  %    (3.2  )%
Charlotte         1,588      1,481       1,675      7.2  %    (5.2  )%
New York          1,662      1,454       1,612      14.3 %    3.1   %
Houston           1,341      1,237       1,407      8.4  %    (4.7  )%
Orlando           967        923         1,042      4.8  %    (7.2  )%
Austin            1,175      1,021       1,249      15.1 %    (5.9  )%
Total             28,625     26,573      29,982     7.7  %    (4.5  )%
                                                                            
Net operating
income
Atlanta           12,527     12,109      12,413     3.5  %    0.9   %      26.1  %
Washington,       9,033      8,873       9,126      1.8  %    (1.0  )%     18.9  %
D.C.
Dallas            9,693      8,956       9,265      8.2  %    4.6   %      20.2  %
Tampa             5,682      5,316       5,576      6.9  %    1.9   %      11.9  %
Charlotte         3,342      3,137       3,338      6.5  %    0.1   %      7.0   %
New York          2,042      2,131       2,097      (4.2 )%   (2.6  )%     4.3   %
Houston           2,112      1,952       2,039      8.2  %    3.6   %      4.4   %
Orlando           1,811      1,669       1,735      8.5  %    4.4   %      3.8   %
Austin            1,648      1,609       1,596      2.4  %    3.3   %      3.4   %
Total same      $ 47,890   $ 45,752   $  47,185     4.7  %    1.5   %      100.0 %
store NOI
                                                                            
                                                                            
Average
rental rate
per unit
Atlanta         $ 1,227    $ 1,155    $  1,214      6.2  %    1.1   %
Washington,       1,889      1,832       1,883      3.1  %    0.3   %
D.C.
Dallas            1,170      1,099       1,160      6.5  %    0.9   %
Tampa             1,361      1,281       1,348      6.2  %    1.0   %
Charlotte         1,182      1,091       1,167      8.3  %    1.3   %
New York          3,856      3,749       3,824      2.9  %    0.8   %
Houston           1,366      1,236       1,338      10.5 %    2.1   %
Orlando           1,502      1,405       1,487      6.9  %    1.0   %
Austin            1,475      1,376       1,466      7.2  %    0.6   %
Total average
rental rate       1,382      1,305       1,370      5.9  %    0.9   %
per unit
                                                                            

Table 3 (con’t)
Same Store Net Operating Income (NOI) and Average Rental Rate per Unit by
Market
(In thousands)
                                                                     
                                      Year ended
                                      December 31,   December 31,
                                      2012           2011             % Change
Rental and other revenues
Atlanta                               $   82,080     $   76,782       6.9   %
Washington, D.C.                          52,426         49,954       4.9   %
Dallas                                    63,093         58,587       7.7   %
Tampa                                     34,839         32,514       7.2   %
Charlotte                                 19,451         17,919       8.5   %
New York                                  14,683         14,097       4.2   %
Houston                                   13,503         12,305       9.7   %
Orlando                                   10,927         10,167       7.5   %
Austin                                    11,130         10,051       10.7  %
Total rental and other revenues           302,132        282,376      7.0   %
                                                                       
Property operating and maintenance
expenses (exclusive of
depreciation
and amortization)
Atlanta                                   32,753         31,259       4.8   %
Washington, D.C.                          16,274         15,897       2.4   %
Dallas                                    26,474         25,446       4.0   %
Tampa                                     12,871         12,202       5.5   %
Charlotte                                 6,625          6,549        1.2   %
New York                                  6,567          6,086        7.9   %
Houston                                   5,393          5,213        3.5   %
Orlando                                   4,013          3,935        2.0   %
Austin                                    4,819          4,290        12.3  %
Total                                     115,789        110,877      4.4   %
                                                                       
Net operating income
Atlanta                                   49,327         45,523       8.4   %
Washington, D.C.                          36,152         34,057       6.2   %
Dallas                                    36,619         33,141       10.5  %
Tampa                                     21,968         20,312       8.2   %
Charlotte                                 12,826         11,370       12.8  %
New York                                  8,116          8,011        1.3   %
Houston                                   8,110          7,092        14.4  %
Orlando                                   6,914          6,232        10.9  %
Austin                                    6,311          5,761        9.5   %
Total same store NOI                  $   186,343    $   171,499      8.7   %
                                                                       
                                                                       
Average rental rate per unit
Atlanta                               $   1,199      $   1,124        6.7   %
Washington, D.C.                          1,868          1,812        3.1   %
Dallas                                    1,146          1,070        7.1   %
Tampa                                     1,332          1,243        7.2   %
Charlotte                                 1,146          1,055        8.6   %
New York                                  3,800          3,705        2.6   %
Houston                                   1,315          1,205        9.1   %
Orlando                                   1,465          1,370        6.9   %
Austin                                    1,441          1,331        8.3   %
Total average rental rate per unit        1,353          1,274        6.2   %
 

Table 4
Computation of Debt Ratios
(In thousands)
 
                                             As of December 31,
                                             2012                2011
Total real estate assets per balance sheet   $ 2,191,708         $ 2,075,517
Plus:
Company share of real estate assets held       58,726              70,065
in unconsolidated entities
Company share of accumulated depreciation      11,158              12,573
- assets held in unconsolidated entities
Accumulated depreciation per balance sheet     842,925             767,017    
Total undepreciated real estate assets (A)   $ 3,104,517         $ 2,925,172  
                                                                  
Total debt per balance sheet                 $ 1,102,464         $ 970,443
Plus:
Company share of third party debt held in      49,531              59,601     
unconsolidated entities
Total debt (adjusted for joint venture       $ 1,151,995         $ 1,030,044  
partners' share of debt) (B)
                                                                  
Total debt as a % of undepreciated real
estate assets (adjusted for joint venture
partners' share of debt) (B÷A)                 37.1      %         35.2      %
                                                                  
Total debt per balance sheet                 $ 1,102,464         $ 970,443
Plus:
Company share of third party debt held in      49,531              59,601
unconsolidated entities
Preferred shares at liquidation value          43,392              43,392     
Total debt and preferred equity (adjusted
for joint venture partners'
share of debt) (C)                           $ 1,195,387         $ 1,073,436  
                                                                  
Total debt and preferred equity as a % of
undepreciated real estate assets (adjusted
for joint venture partners' share of debt)     38.5      %         36.7      %
(C÷A)

Contact:

Post Properties, Inc.
Chris Papa, 404-846-5028
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