Our diversification strategy. Key to the strategy is having a geographically diverse portfolio concentrated in high-growth markets. During 2004, we expanded our internal audit function, and created the new position of Director of Internal Audit to supervise our team of professionals. We performed the required assessment of internal controls over financial reporting as mandated by the Sarbanes-Oxley Act of 2002. Our documentation efforts were completed ahead of schedule and our internal controls are sound. A BALANCING ACT  Our diversification strategy is at the core of our long-term business plan. Key to this strategy is having a geographically diverse portfolio concentrated in high-growth markets. As a result, we are able to leverage all stages of the market’s cycles and capture greater market share by offering our residents high-quality apartment homes at varying price points. In 2004, our development pipeline and capital recycling program continued to actively support this goal. Two new development communities totaling 786 garden apartment homes were added to the stabilized portfolio: Camden Oak Crest with 364 apartment homes in Houston,Texas and Camden Sierra at Otay Ranch with 422 apartment homes in Chula Vista, California. We also completed construction on Camden Harbor View; a 538 mixed-use apartment home community located in Long Beach, California. Its operations stabilized during the first quarter of 2005. Lastly, we began construction on Camden Farmers Market II, a 284 apartment home community in Dallas,Texas and on Camden Lago Vista, a 366 apartment home community located in Orlando, Florida. We continued to recycle non-strategic assets, selling older assets that no longer meet our investment criteria and diversification strategy, and reinvesting the capital into newer assets in high-growth markets. During 2004, we sold one community with 552 apartment homes in Orlando, Florida and disposed of another 432 apartment home community in Las Vegas, Nevada shortly after year-end. We identified a third 454 apartment home community in Tampa, Florida as held for sale and anticipate the sale to close in the second quarter of 2005. PEOPLE FIRST 2004 was a year in which we continued to seek highly skilled professionals to join our team, further develop the talented individuals already on board and recognize individual and team performance. To recruit great people, we provide a highly competitive compensation plan and offer a comprehensive benefit program, which includes the most affordable employee contribution for benefits participation among our peer group. Camden University offers six degree programs specific to onsite positions that has produced 175 graduates. To honor this achievement, our graduates receive a one-time 3.5% salary increase. Most importantly, we take transforming  camden  27