NOTES TO CONSOLIDATED FINANCIAL STATEMENTS fixed number of corresponding Series B Cumulative Redeemable Perpetual Preferred Shares. The Series B preferred  units are subordinate to present and future debt. Distributions on the Series B preferred units totaled $7.0 million and  $8.4 million for the years ended December 31, 2004 and 2003, respectively. Additionally, our operating partnership had issued $53 million of 8.25% Series C Cumulative Redeemable Perpetual  Preferred Units. During the third quarter of 2004, we redeemed 1.4 million Series C preferred units at their  redemption price of $25.00 per unit, or an aggregate of $35.5 million, plus accrued and unpaid distributions. In  connection with the issuance of these Series C preferred units, we incurred $0.7 million in issuance costs which  had been recorded as a reduction to minority interests. These issuance costs were expensed in connection with the  redemption of the Series C preferred units. Subsequent to year end, we redeemed the remaining 0.7 million Series C  preferred units at their redemption price of $25.00 per unit, or an aggregate of $17.5 million, plus accrued and unpaid  distributions. In connection with the issuance of these Series C preferred units, we incurred $0.4 million in issuance  costs which had been recorded as a reduction to minority interests. These issuance costs were expensed in January  2005 in connection with the redemption of the Series C preferred units. Distributions on the Series C preferred units  totaled $3.5 million and $4.3 million for the years ended December 31, 2004 and 2003, respectively. In conjunction with our acquisition of Oasis Residential, Inc. in 1998, we acquired the controlling managing member  interest in Oasis Martinique, LLC, which owns one property in Orange County, California and is included in our  consolidated financial statements. The remaining interests, comprising 740,348 units, are exchangeable into 561,924  of our common shares. Minority interests in the accompanying consolidated financial statements relate to holders of common and preferred  limited partnership units of Camden Operating, L.P. and units in Oasis Martinique, LLC. All cash and investments in money market accounts and other securities with a maturity of three months or less at  the date of purchase are considered to be cash and cash equivalents. Restricted cash consists of escrow deposits held by lenders for property taxes, insurance and replacement reserves,  cash required to be segregated for the repayment of residents’ security deposits and escrowed amounts related to our  development activities. Substantially all restricted cash is invested in demand and short-term instruments. Real estate assets are carried at cost plus capitalized carrying charges. Carrying charges are primarily interest and  real estate taxes which are capitalized as part of properties under development. Expenditures directly related to the  development, acquisition and improvement of real estate assets, excluding internal costs relating to acquisitions  of operating properties, are capitalized at cost as land, buildings and improvements. Indirect development costs,  including salaries and benefits and other related costs that are clearly attributable to the development of properties,  are also capitalized. All construction and carrying costs are capitalized and reported on the balance sheet in  properties under development until the apartment homes are substantially completed. Upon substantial completion  of the apartment homes, the total cost for the apartment homes and the associated land is transferred to buildings  and improvements and land, respectively, and the assets are depreciated over their estimated useful lives using the  straight-line method of depreciation. Upon the acquisition of real estate, we assess the fair value of acquired assets, including land, buildings, the value of  in-place leases, including above and below market leases, and acquired liabilities. We then allocate the purchase price  of the acquired property based on these assessments. We assess fair value based on estimated cash flow projections  and available market information. As of December 31, 2004, we have not acquired any operating properties that would  fall within the scope of SFAS No. 141, “Business Combinations”. On January 1, 2002, we adopted SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets”, which  requires that the assets and results of operations of any communities that have been sold, or otherwise qualify as held  for sale, be presented as discontinued operations in our consolidated financial statements for all periods presented.  74 camden transforming Cash and Cash Equivalents Restricted Cash Real Estate Assets, at Cost