##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 For the quarterly period ended: March 31, 2008
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 For the transition period from to
 Commission File Number: 0-20707
 COLONIAL REALTY LIMITED PARTNERSHIP
 (Exact name of registrant as specified in its charter)
 Delaware(State or other jurisdiction 
of incorporation or organization)
    
    63-1098468(IRS Employer
Identification Number)
 2101 Sixth Avenue North, Suite 750, Birmingham, Alabama 35203  Address of principal executive offices) (Zip code)
 (205) 250-8700  (Registrants telephone number, including area code )
 Not applicable  (Former name, former address and former fiscal year, if changed since last report)
  þ o
  Large accelerated filer þ
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
  o þ




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##### 



COLONIAL REALTY LIMITED PARTNERSHIP
INDEX TO FORM 10-Q
 PagePART I: FINANCIAL INFORMATIONItem 1. Consolidated Condensed Financial Statements (Unaudited):Consolidated Condensed Balance Sheets as of March 31, 2008 and December 31, 2007
    
    
    3Consolidated Condensed Statements of Income and Comprehensive Income for the Three Months ended March 31, 2008 and 2007
    
    
    4Consolidated Condensed Statements of Cash Flows for the Three Months ended March 31, 2008 and 2007
    
    
    5Notes to Consolidated Condensed Financial Statements
    
    
    6Report of Independent Registered Public Accounting Firm *
    
    
    23Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    24Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    37Item 4. Controls and Procedures
    
    
    37PART II: OTHER INFORMATIONItem 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    37Item 6. Exhibits
    
    
    38SIGNATURES
    
    
    39EXHIBIT INDEX
    
    
    40EX-12.1 RATIO OF EARNINGS TO FIXED CHARGESEX-15.1 RE:LETTER UNAUDITED INTERIM FINANCIAL INFORMATIONEX-31.1 SECTION 302 CERTIFICATION OF CEOEX-31.2 SECTION 302 CERTIFICATION OF CFOEX-32.1 SECTION 906 CERTIFICATION OF CEOEX-32.2 SECTION 906 CERTIFICATION OF CFO
  
 *
    
    Review by Independent Registered Public Accounting Firm
  2




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COLONIAL REALTY LIMITED PARTNERSHIP
CONSOLIDATED CONDENSED BALANCE SHEETS
(Unaudited)  (in thousands, except unit data)
 March 31, 2008
    
    
    December 31, 2007ASSETSLand, buildings, & equipment
    
    $
    2,565,346
    
    
    $
    2,431,064Undeveloped land and construction in progress
    
    
    505,515
    
    
    
    531,410Less: Accumulated depreciation
    
    
    (319,160
    )
    
    
    (290,118
    )Real estate assets held for sale, net
    
    
    250,556
    
    
    
    253,641Net real estate assets
    
    
    3,002,257
    
    
    
    2,925,997Cash and equivalents
    
    
    32,086
    
    
    
    92,841Restricted cash
    
    
    10,165
    
    
    
    10,005Accounts receivable, net
    
    
    18,203
    
    
    
    25,534Notes receivable
    
    
    29,759
    
    
    
    30,756Prepaid expenses
    
    
    11,678
    
    
    
    8,845Deferred debt and lease costs
    
    
    18,003
    
    
    
    15,637Investment in partially owned entities
    
    
    61,841
    
    
    
    69,682Deferred tax asset
    
    
    20,572
    
    
    
    19,897Other assets
    
    
    27,831
    
    
    
    30,443Total assets
    
    $
    3,232,395
    
    
    $
    3,229,637LIABILITIES AND PARTNERS EQUITYNotes and mortgages payable
    
    $
    1,581,729
    
    
    $
    1,575,921Unsecured credit facility
    
    
    82,000
    
    
    
    39,316Mortgages payable related to real estate assets held for sale
    
    
    14,309
    
    
    
    26,602Total debt
    
    
    1,678,038
    
    
    
    1,641,839Accounts payable
    
    
    52,393
    
    
    
    68,858Accrued interest
    
    
    25,646
    
    
    
    23,064Accrued expenses
    
    
    19,706
    
    
    
    16,425Other liabilities
    
    
    9,020
    
    
    
    11,966Total liabilities
    
    
    1,784,803
    
    
    
    1,762,152Redeemable units, at redemption value  9,992,778 and 10,052,778
units outstanding at March 31, 2008 and December 31, 2007,
respectively
    
    
    240,326
    
    
    
    227,494Limited partners minority interest in consolidated partnership
    
    
    2,120
    
    
    
    2,439General partner Common equity  47,224,084 and 47,216,549 units outstanding at
March 31, 2008 and December 31, 2007, respectively
    
    
    1,001,112
    
    
    
    1,025,654Preferred equity ($125,000 liquidation preference)
    
    
    112,611
    
    
    
    120,550Limited partners preferred equity ($100,000 liquidation preference)
    
    
    97,406
    
    
    
    97,406Accumulated other comprehensive income (loss)
    
    
    (5,983
    )
    
    
    (6,058
    )Total partners equity
    
    
    1,205,146
    
    
    
    1,237,552Total liabilities and partners equity
    
    $
    3,232,395
    
    
    $
    3,229,637
  3




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COLONIAL REALTY LIMITED PARTNERSHIP
CONSOLIDATED CONDENSED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(Unaudited)  (in thousands, except per unit data)
 Three Months EndedMarch 31,2008
    
    
    2007Revenue:Minimum rent
    
    $
    64,872
    
    
    $
    93,865Tenant recoveries
    
    
    867
    
    
    
    5,233Other property related revenue
    
    
    7,761
    
    
    
    7,642Construction revenues
    
    
    7,879
    
    
    
    12,785Other non-property related revenue
    
    
    5,299
    
    
    
    3,243Total revenue
    
    
    86,678
    
    
    
    122,768Operating Expenses:Property operating expenses
    
    
    19,111
    
    
    
    25,435Taxes, licenses, and insurance
    
    
    9,488
    
    
    
    12,804Construction expenses
    
    
    7,266
    
    
    
    12,371Property management expenses
    
    
    2,241
    
    
    
    3,490General and administrative expenses
    
    
    5,780
    
    
    
    5,978Management fee and other expense
    
    
    3,685
    
    
    
    2,943Investment and development
    
    
    769
    
    
    
    138Depreciation
    
    
    23,691
    
    
    
    32,109Amortization
    
    
    771
    
    
    
    5,725Total operating expenses
    
    
    72,802
    
    
    
    100,993Income from operations
    
    
    13,876
    
    
    
    21,775Other income (expense):Interest expense and debt cost amortization
    
    
    (18,440
    )
    
    
    (27,534
    )Gains (losses) on retirement of debt
    
    
    5,471
    
    
    
    (64
    )Interest income
    
    
    791
    
    
    
    2,131Income (loss) from partially owned entities
    
    
    10,269
    
    
    
    6,814Gains from sales of property, net of income taxes of $406 in 2008
and $747 in 2007
    
    
    1,931
    
    
    
    1,325Minority interest of limited partners
    
    
    5
    
    
    
    143Income taxes and other
    
    
    874
    
    
    
    (233
    )Total other income (expense)
    
    
    901
    
    
    
    (17,418
    )Income from continuing operations
    
    
    14,777
    
    
    
    4,357Income from discontinued operations
    
    
    4,126
    
    
    
    6,322Gain on
disposal of discontinued operations, net of income tax (benefit)
expense of ($14) in 2008
and $1,528 in 2007
    
    
    2,913
    
    
    
    34,801Minority interest of limited partners
    
    
    13
    
    
    
    (42
    )Income from discontinued operations
    
    
    7,052
    
    
    
    41,081Net income
    
    
    21,829
    
    
    
    45,438Distributions to general partner preferred unitholders
    
    
    (2,488
    )
    
    
    (4,491
    )Distributions to limited partner preferred unitholders
    
    
    (1,827
    )
    
    
    (1,812
    )Preferred unit issuance costs write-off
    
    
    (271
    )
    
    
    Net income available to common unitholders
    
    $
    17,243
    
    
    $
    39,135Net income available to common unitholders allocated to limited partners
    
    
    (3,016
    )
    
    
    (7,279
    )Net income available to common unitholders allocated to general partner
    
    $
    14,227
    
    
    $
    31,856Net income per common unit  Basic:Income (loss) from continuing operations
    
    $
    0.18
    
    
    $
    (0.03
    )Income from discontinued operations
    
    
    0.12
    
    
    
    0.72Net income per common unit  Basic
    
    $
    0.30
    
    
    $
    0.69Net income per common unit  Diluted:Income (loss) from continuing operations
    
    $
    0.18
    
    
    $
    (0.03
    )Income from discontinued operations
    
    
    0.12
    
    
    
    0.72Net income per common unit  Diluted
    
    $
    0.30
    
    
    $
    0.69Average units outstanding:Basic
    
    
    56,868
    
    
    
    56,543Diluted
    
    
    57,029
    
    
    
    56,543CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOMENet income
    
    $
    21,829
    
    
    $
    45,438Other comprehensive incomeUnrealized income (loss) on cash flow hedging activities
    
    
    
    
    
    
    (185
    )Comprehensive income
    
    $
    21,829
    
    
    $
    45,253
  4




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COLONIAL REALTY LIMITED PARTNERSHIP
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)  (in thousands)
 Three Months EndedMarch 31,2008
    
    
    2007Cash flows from operating activities:Net income
    
    $
    21,829
    
    
    $
    45,438Adjustments to reconcile net income to net cash provided
by operating activities:Depreciation and amortization
    
    
    24,810
    
    
    
    39,794Loss (income) from partially-owned unconsolidated entities
    
    
    (10,269
    )
    
    
    (6,814
    )Gains from sales of property
    
    
    (5,236
    )
    
    
    (38,401
    )Gains on retirement of debt
    
    
    (5,471
    )
    
    
    Distributions of income from partially-owned unconsolidated entities
    
    
    3,217
    
    
    
    2,335Decrease (increase) in:Restricted cash
    
    
    (160
    )
    
    
    (1,467
    )Accounts receivable
    
    
    7,331
    
    
    
    2,505Prepaid expenses
    
    
    (2,833
    )
    
    
    4,824Other assets
    
    
    (382
    )
    
    
    (5,304
    )Increase (decrease) in:Accounts payable
    
    
    (14,140
    )
    
    
    9,756Accrued interest
    
    
    2,582
    
    
    
    (12,486
    )Accrued expenses and other
    
    
    1,215
    
    
    
    5,100Net cash provided by operating activities
    
    
    22,493
    
    
    
    45,280Cash flows from investing activities:Acquisition of properties
    
    
    (7,369
    )
    
    
    (116,726
    )Development expenditures
    
    
    (70,409
    )
    
    
    (74,138
    )Tenant
improvements and leasing commissions
    
    
    (1,576
    )
    
    
    (7,425
    )Capital expenditures
    
    
    (4,584
    )
    
    
    (5,723
    )Proceeds from sales of property, net of selling costs
    
    
    6,430
    
    
    
    186,801Issuance of notes receivable
    
    
    (3,262
    )
    
    
    Repayments of notes receivable
    
    
    4,259
    
    
    
    32,504Distributions from partially-owned unconsolidated entities
    
    
    17,194
    
    
    
    15,215Capital contributions to partially-owned unconsolidated entities
    
    
    (4,517
    )
    
    
    (7,114
    )Sale of investments
    
    
    3,596
    
    
    
    Net cash provided by (used in) investing activities
    
    
    (60,238
    )
    
    
    23,394Cash flows from financing activities:Proceeds from additional borrowings
    
    
    57,630
    
    
    
    Principal reductions of debt
    
    
    (73,692
    )
    
    
    (22,546
    )Net change in revolving credit balances and overdrafts
    
    
    35,605
    
    
    
    (77,224
    )Dividends paid to common and preferred unitholders
    
    
    (28,233
    )
    
    
    (44,949
    )Distributions to minority partners in CRLP
    
    
    (4,996
    )
    
    
    Repurchase of Preferred Series D Units
    
    
    (7,397
    )
    
    
    Other financing activities, net
    
    
    (1,927
    )

    
    7,256Net cash used in financing activities
    
    
    (23,010
    )
    
    
    (137,463
    )Increase (decrease) in cash and cash equivalents
    
    
    (60,755
    )
    
    
    (68,789
    )Cash and cash equivalents, beginning of period
    
    
    92,841
    
    
    
    87,647Cash and cash equivalents, end of period
    
    $
    32,086
    
    
    $
    18,858Supplemental disclosure of cash flow information:Cash paid during the period for interest, including amounts capitalized
    
    $
    21,233
    
    
    $
    48,292Cash paid during the period for income taxes
    
    $
    4,335
    
    
    $
    3,408Supplemental disclosure of non-cash transactions:Cash flow hedging activities
    
    $
    
    
    
    $
    (185
    )
  5




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COLONIAL REALTY LIMITED PARTNERSHIP NOTES TO
CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
March 31, 2008
 The consolidated condensed financial statements of Colonial Realty Limited Partnership have
been prepared pursuant to the Securities and Exchange Commission (SEC) rules and regulations.
The following notes, which represent interim disclosures as required by the SEC, highlight
significant changes to the notes included in the December 31, 2007 audited consolidated financial
statements of Colonial Realty Limited Partnership and should be read together with the consolidated
financial statements and notes thereto included in the Colonial Realty Limited Partnership 2007
Annual Report on Form 10-K.
 Note 1  Organization and Business
  Note 2  Strategic Initiative
    6




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Note 3  Summary of Significant Accounting Policies
 Basis of Presentation
  ,
   Federal Income Tax Status
  7




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Use of Estimates
  Unaudited Interim Statements
 .
 Revenue Recognition
 Accounting for Sales of Real Estate
  8




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Impairment
 Accounting for the Impairment or Disposal of Long-Lived
Assets
 Investment and Development
  Notes Receivable
  Assets and Liabilities Measured at Fair Value
 Fair
Value Measurements
 9




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New Accounting Pronouncements
 Fair Value Measurement Accounting for Leases
 The Fair Value Option for Financial Assets and
Financial Liabilities  including an amendment of FASB Statement No. 115
 Noncontrolling Interests in Consolidated
Financial Statements  an amendment of ARB No. 51.
 Business Combinations
 10




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Disclosures about Derivative Instruments and
Hedging Activities
 Note 4 Capital Structure
    Note 5  Acquisition and Disposition Activity
 Property Acquisitions
  11




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Property Dispositions
         12




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##### Table of Contents



Property
    
    Location
    
    Date Sold
    
    Units/ Square FeetMultifamilyMayflower Seaside
    
    Virginia Beach, VA
    
    June 2007
    
    
    265Cape Landing
    
    Myrtle Beach, SC
    
    June 2007
    
    
    288Colonial Grand at Natchez Trace
    
    Jackson, MS
    
    June 2007
    
    
    328Colonial Grand at The Reservoir
    
    Jackson, MS
    
    June 2007
    
    
    170Colonial Grand at Promenade
    
    Montgomery, AL
    
    February 2007
    
    
    384Beacon Hill
    
    Charlotte, NC
    
    January 2007
    
    
    349Clarion Crossing
    
    Raleigh, NC
    
    January 2007
    
    
    260Colonial Grand at Enclave
    
    Atlanta, GA
    
    January 2007
    
    
    200Colonial Village at Poplar Place
    
    Atlanta, GA
    
    January 2007
    
    
    324Colonial Village at Regency Place
    
    Raleigh, NC
    
    January 2007
    
    
    180Colonial Village at Spring Lake
    
    Atlanta, GA
    
    January 2007
    
    
    188Colonial Village at Timothy Woods
    
    Athens, GA
    
    January 2007
    
    
    204Office250 Commerce Center
    
    Montgomery, AL
    
    February 2008
    
    
    37,000RetailVillage on the Parkway
    
    Dallas, TX
    
    July 2007
    
    
    380,500Britt David Shopping Center
    
    Columbus, GA
    
    July 2007
    
    
    102,600Colonial Mall Decatur
    
    Huntsville, AL
    
    July 2007
    
    
    576,100Colonial Mall Lakeshore
    
    Gainesville, GA
    
    July 2007
    
    
    518,300Colonial Mall Staunton
    
    Staunton, VA
    
    July 2007
    
    
    424,000Colonial Mayberry Mall
    
    Mount Airy, NC
    
    July 2007
    
    
    206,900Colonial Promenade Montgomery
    
    Montgomery, AL
    
    July 2007
    
    
    209,100Colonial Promenade Montgomery
North
    
    Montgomery, AL
    
    July 2007
    
    
    209,900Colonial Shoppes Bellwood
    
    Montgomery, AL
    
    July 2007
    
    
    87,500Colonial Shoppes McGehee Place
    
    Montgomery, AL
    
    July 2007
    
    
    98,300Colonial Shoppes Quaker Village
    
    Greensboro, NC
    
    July 2007
    
    
    101,900Olde Town Shopping Center
    
    Montgomery, AL
    
    July 2007
    
    
    38,700Colonial Shoppes Wekiva
    
    Orlando, FL
    
    May 2007
    
    
    208,600Colonial Shoppes Bear Lake
    
    Orlando, FL
    
    April 2007
    
    
    131,300Colonial Shoppes Yadkinville
    
    Yadkinville, NC
    
    March 2007
    
    
    90,917Rivermont Shopping Center
    
    Chattanooga, TN
    
    February 2007
    
    
    73,481
    13




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Three Months Ended(amounts in thousands)
    
    March 31,2008
    
    
    2007Property revenues:Base rent
    
    $
    6,590
    
    
    $
    15,993Tenant recoveries
    
    
    5
    
    
    
    1,660Other revenue
    
    
    821
    
    
    
    1,355Total revenues
    
    
    7,416
    
    
    
    19,008Property operating and administrative expenses
    
    
    3,063
    
    
    
    7,863Depreciation
    
    
    
    
    
    
    2,734Amortization
    
    
    
    
    
    
    62Total expenses
    
    
    3,063
    
    
    
    10,659Interest expense, net
    
    
    (227
    )
    
    
    (2,027
    )Income from discontinued operations before net gain
on disposition of discontinued operations
    
    
    4,126
    
    
    
    6,322Net gain on disposition of discontinued operations
    
    
    2,913
    
    
    
    34,801Minority interest to limited partners
    
    
    13
    
    
    
    (42
    )Income from discontinued operations
    
    $
    7,052
    
    
    $
    41,081
 Note 6  For-Sale Activities and Impairment
 For-Sale Residential Activities
  (amounts in thousands)
    
    Three Months EndedMarch 31,2008
    
    
    2007Condominium revenues, net
    
    $
    
    
    
    $
    34,079Condominium costs
    
    
    
    
    
    
    (25,956
    )Gains on condominium sales, before minority interest and income taxes
    
    
    
    
    
    
    8,123For-sale residential revenues, net
    
    
    2,776
    
    
    
    9,259For-sale residential costs
    
    
    (2,743
    )
    
    
    (7,017
    )Gains on for-sale residential sales, before minority interest and income taxes
    
    
    33
    
    
    
    2,242Minority interest
    
    
    
    
    
    
    142(Provision) / benefit for income taxes
    
    
    32
    
    
    
    (2,275
    )Gains on condominium conversions, for-sale residential sales and
developments, net of minority interest and income taxes
    
    $
    65
    
    
    $
    8,232
 14




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Impairment
   Commercial Developments
  15




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Note 7  Net Income Per Unit
  Three Months Ended(amounts in table in thousands)
    
    March 31,
    
    
    March 31,2008
    
    
    2007Numerator:Income from continiung operations
    
    $
    14,777
    
    
    $
    4,357Less: Distributions to general partner preferred unitholders
    
    
    (2,488
    )
    
    
    (4,491
    )Less: Distributions to limited partner preferred unitholders
    
    
    (1,827
    )
    
    
    (1,812
    )Less: Preferred unit issuance costs
    
    
    (271
    )
    
    
    Net income (loss) available to common unitholders
    
    $
    10,191
    
    
    $
    (1,946
    )Denominator:Denominator for basic net income per unit  weighted average units
    
    
    56,868
    
    
    
    56,543Effect of dilutive securities:Trustee and employee stock options, treasury method
    
    
    161
    
    
    
    Denominator for diluted net income per unit -
adjusted weighted average units
    
    
    57,029
    
    
    
    56,543
  Note 8  Segment Information
  16




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Three Months EndedMarch 31,(in thousands)
    
    2008
    
    
    2007Revenues:Segment Revenues:Multifamily
    
    $
    78,295
    
    
    $
    76,489Office
    
    
    14,614
    
    
    
    38,026Retail
    
    
    8,710
    
    
    
    25,301Total Segment Revenues
    
    
    101,619
    
    
    
    139,816Partially-owned unconsolidated entities  Mfam
    
    
    (2,218
    )
    
    
    (2,572
    )Partially-owned unconsolidated entities  Off
    
    
    (13,147
    )
    
    
    (7,827
    )Partially-owned unconsolidated entities  Rtl
    
    
    (5,338
    )
    
    
    (3,669
    )Construction revenues
    
    
    7,879
    
    
    
    12,785Unallocated corporate revenues
    
    
    5,299
    
    
    
    3,243Discontinued operations property revenues
    
    
    (7,416
    )
    
    
    (19,008
    )Total Consolidated Revenues
    
    
    86,678
    
    
    
    122,768NOI:Segment NOI:Multifamily
    
    
    47,264
    
    
    
    45,146Office
    
    
    9,652
    
    
    
    25,194Retail
    
    
    5,953
    
    
    
    17,859Total Segment NOI
    
    
    62,869
    
    
    
    88,199Partially-owned unconsolidated entities  Mfam
    
    
    (1,131
    )
    
    
    (1,067
    )Partially-owned unconsolidated entities  Off
    
    
    (8,521
    )
    
    
    (4,839
    )Partially-owned unconsolidated entities  Rtl
    
    
    (3,786
    )
    
    
    (2,526
    )Unallocated corporate revenues
    
    
    5,299
    
    
    
    3,243Discontinued operations property NOI
    
    
    (4,353
    )
    
    
    (11,145
    )Construction NOI
    
    
    613
    
    
    
    414Property management expenses
    
    
    (2,241
    )
    
    
    (3,490
    )General and administrative expenses
    
    
    (5,780
    )
    
    
    (5,978
    )Management fee and other expenses
    
    
    (3,685
    )
    
    
    (2,943
    )Investment and development (1)
    
    
    (769
    )
    
    
    (138
    )Depreciation
    
    
    (23,691
    )
    
    
    (32,109
    )Amortization
    
    
    (771
    )
    
    
    (5,725
    )Other
    
    
    (177
    )
    
    
    (121
    )Income from operations
    
    
    13,876
    
    
    
    21,775Total other income (expense), net (2)
    
    
    901
    
    
    
    (17,418
    )Income (loss) from continuing operations
    
    $
    14,777
    
    
    $
    4,357
 (in thousands)
    
    March 31,
    
    
    December 31,2008
    
    
    2007AssetsSegment Assets
Multifamily
    
    $
    2,523,257
    
    
    $
    2,449,558Office
    
    
    118,341
    
    
    
    82,630Retail
    
    
    188,353
    
    
    
    149,933For-Sale Residential (3)
    
    
    136,168
    
    
    
    211,729Total Segment Assets
    
    
    2,966,119
    
    
    
    2,893,850Unallocated corporate assets (4)
    
    
    266,276
    
    
    
    335,787$
    3,232,395
    
    
    $
    3,229,637
 
 (1)
    
    Reflects costs incurred related to abandoned pursuits. Abandoned pursuits are volatile and
therefore may vary between periods.(2)
    
    For-sale residential activities including net gain on sales and income tax expense
(benefit) are included in other income (See table below for additional details on for-sale
residential activities and also Note 6 related to for-sale activities).(3)
    
    Two projects, formerly for-sale residential developments, are now being developed / leased
as multifamily apartment communities.(4)
    
    Includes CRLPs investment in partially-owned entities of $61,841 as of March 31, 2008 and
$69,682 as of December 31, 2007. 17




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##### Table of Contents



For-Sale Residential
 Three Months EndedMarch 31,(in thousands)
    
    2008
    
    
    2007Gains on for-sale residential sales
    
    $
    33
    
    
    $
    2,242Income tax benefit (expense)
    
    
    18
    
    
    
    (835
    )Income from for-sale residential sales
    
    $
    51
    
    
    $
    1,407
 Note 9  Investment in Partially-Owned Entities
  (in thousands)Percent
    
    
    March 31,
    
    
    December 31,Owned
    
    
    2008
    
    
    2007Multifamily:Arbors at Windsor Lake, Columbia, SC
    
    
    10.00
    %(1)
    
    $
    
    
    
    $
    569Auberry at Twin Creeks, Dallas, TX
    
    
    15.00
    %(2)
    
    
    
    
    
    
    702Belterra, Ft. Worth, TX
    
    
    10.00
    %
    
    
    690
    
    
    
    708Carter Regents Park, Atlanta, GA
    
    
    40.00
    %(3)
    
    
    5,316
    
    
    
    5,282CG at Huntcliff, Atlanta, GA
    
    
    20.00
    %
    
    
    2,078
    
    
    
    2,138CG at McKinney, Dallas, TX (Development)
    
    
    20.00
    %
    
    
    876
    
    
    
    1,003CG at Research Park, Raleigh, NC
    
    
    20.00
    %
    
    
    1,153
    
    
    
    1,197CG at Traditions, Gulf Shores, AL (Development)
    
    
    35.00
    %
    
    
    1,683
    
    
    
    1,591CMS / Colonial Joint Venture I
    
    
    15.00
    %
    
    
    438
    
    
    
    435CMS / Colonial Joint Venture II
    
    
    15.00
    %(4)
    
    
    (415
    )
    
    
    (419
    )CMS Florida
    
    
    25.00
    %(5)
    
    
    (388
    )
    
    
    (338
    )CMS Tennessee
    
    
    25.00
    %(6)
    
    
    256
    
    
    
    258CMS V / CG at Canyon Creek, Austin, TX
    
    
    25.00
    %
    
    
    873
    
    
    
    1,226CV at Matthews, Charlotte, NC
    
    
    25.00
    %(7)
    
    
    
    
    
    
    1,004DRA Alabama
    
    
    10.00
    %
    
    
    2,314
    
    
    
    2,260DRA CV at Cary, Raleigh, NC
    
    
    20.00
    %
    
    
    1,973
    
    
    
    2,026DRA Cunningham, Austin, TX
    
    
    20.00
    %
    
    
    969
    
    
    
    969DRA The Grove at Riverchase, Birmingham, AL
    
    
    20.00
    %
    
    
    1,461
    
    
    
    1,409Fairmont at Fossil Creek, Fort Worth, TX
    
    
    15.00
    %(8)
    
    
    
    
    
    
    567Park Crossing, Fairfield, CA
    
    
    10.00
    %(9)
    
    
    
    
    
    
    797Stone Ridge, Columbia, SC
    
    
    10.00
    %
    
    
    459
    
    
    
    451Total Multifamily
    
    
    
    
    
    
    19,736
    
    
    
    23,835Office:600 Building Partnership, Birmingham, AL
    
    
    33.33
    %
    
    
    84
    
    
    
    76Colonial Center Mansell JV
    
    
    15.00
    %
    
    
    1,264
    
    
    
    1,377DRA / CRT JV
    
    
    15.00
    %(10)
    
    
    22,212
    
    
    
    23,365DRA / CLP JV
    
    
    15.00
    %(11)
    
    
    (7,826
    )
    
    
    (6,603
    )Huntsville TIC; Huntsville , AL
    
    
    33.26
    %(12)
    
    
    3,837
    
    
    
    7,922Total Office
    
    
    
    
    
    
    19,571
    
    
    
    26,137Retail:Colonial Promenade Madison, Huntsville, AL
    
    
    25.00
    %
    
    
    2,232
    
    
    
    2,258Colonial Promenade Smyrna, Smyrna, TN
(Development)
    
    
    50.00
    %
    
    
    2,257
    
    
    
    2,297GPT / Colonial Retail JV
    
    
    10.00
    %(13)
    
    
    
    
    
    
    (5,021
    )Highway 150, LLC, Birmingham, AL
    
    
    10.00
    %
    
    
    61
    
    
    
    64OZRE JV
    
    
    15.00
    %(14)
    
    
    (6,622
    )
    
    
    (6,204
    )Parkway Place Limited Partnership, Huntsville,
AL
    
    
    45.00
    %
    
    
    9,774
    
    
    
    10,342Colonial Promenade Craft Farms, Gulf Shores, AL
    
    
    15.00
    %
    
    
    1,123
    
    
    
    1,300Parkside Drive LLC I, Knoxville, TN
    
    
    50.00
    %
    
    
    5,821
    
    
    
    6,898Parkside Drive LLC II, Knoxville, TN
(Development)
    
    
    50.00
    %
    
    
    6,256
    
    
    
    6,270Colonial Promenade Alabaster II/Tutwiler II,
Birmingham, AL
    
    
    5.00
    %
    
    
    (121
    )
    
    
    (107
    )20,781
    
    
    
    18,097Other:Heathrow, Orlando, FL
    
    
    50.00
    %
    
    
    1,735
    
    
    
    1,585Colonial / Polar-BEK Management Company, Birmingham, AL
    
    
    50.00
    %
    
    
    18
    
    
    
    281,753
    
    
    
    1,613$
    61,841
    
    
    $
    69,682
 
 Footnotes on following page 18




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##### Table of Contents



(1)
    
    CRLP sold its interest in Arbors at Windsor Lake during January 2008.(2)
    
    CRLP sold its interest in Auberry at Twin Creeks during January 2008.(3)
    
    Carter at Regents Park includes a $1.2 million non-cash impairment charge that was
recorded during the three months ended September 30, 2007. CRLP also has a first mortgage
on this property of $23.3 million at March 31, 2008(4)
    
    The CMS/Colonial Joint Venture II holds one property in which CRLP has a 15%
partnership interest.(5)
    
    CRLP sold its interest in Colonial Grand at Bayshore during January 2007.(6)
    
    CRLP sold its interest in Colonial Village at Hendersonville during September 2007.(7)
    
    CRLP acquired the remaining 75% interest in Colonial Village at Matthews during January
2008 (see Note 5).(8)
    
    CRLP sold its interest in Fairmont at Fossil Creek during January 2008.(9)
    
    CRLP sold it interest in Park Crossing during February 2008.(10)
    
    As of March 31, 2008, this joint venture included 18 properties located in Ft.
Lauderdale, Jacksonville and Orlando, Florida; Atlanta, Georgia; Rockville, Maryland;
Charlotte, North Carolina; Memphis, Tennessee and Houston, Texas. CRLP sold its interest in
Saint Petersburg Centre and Las Olas Centre during 2007.(11)
    
    As of March 31, 2008, this joint venture included 16 office properties and 2 retail
properties located in Birmingham, Alabama; Orlando and Tampa, Florida; Atlanta, Georgia;
Charlotte, North Carolina and Austin, Texas. Amount includes the value of CRLPs investment
of approximately $27.6 million, offset by the excess basis difference on the June 2007
joint venture transaction (see Note 2) of approximately $35.4 million, which is being
amortized over the life of the properties.(12)
    
    Amount includes CRLPs investment of approximately $15.6 million, offset by the excess
basis difference on the transaction of approximately $11.7 million, which is bring
amortized over the life of the properties.(13)
    
    CRLPs 10% interest in this joint venture was sold during February 2008.(14)
    
    As of March 31, 2008, this joint venture included 11 retail properties located in
Birmingham, Alabama; Jacksonville, Orlando, Punta Gorda and Tampa, Florida; Athens, Georgia
and Houston, Texas. Amount includes the value of CRLPs investment of approximately $10.5
million, offset by the excess basis difference on the June 2007 joint venture transaction
(see Note 2) of approximately $17.2 million, which is being amortized over the life of the
properties.        19




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##### Table of Contents



Total Assets
    
    
    Total Debt
    
    
    Total Equity2008
    
    
    2007
    
    
    2008
    
    
    2007
    
    
    2008
    
    
    2007DRA/CRT
    
    $
    1,217,063
    
    
    $
    1,248,807
    
    
    $
    993,189
    
    
    $
    993,264
    
    
    $
    192,252
    
    
    $
    202,162DRA/CLP
    
    
    938,561
    
    
    
    973,861
    
    
    
    741,907
    
    
    
    741,907
    
    
    
    183,161
    
    
    
    194,210OZRE
    
    
    357,542
    
    
    
    362,734
    
    
    
    284,000
    
    
    
    284,000
    
    
    
    70,217
    
    
    
    74,012GPT
    
    
    
    
    
    
    374,498
    
    
    
    
    
    
    
    322,776
    
    
    
    
    
    
    
    43,982$
    2,513,166
    
    
    $
    2,959,900
    
    
    $
    2,019,096
    
    
    $
    2,341,947
    
    
    $
    445,630
    
    
    $
    514,366
  Total Revenues
    
    
    Net Income
    
    
    Share of Net Income2008
    
    
    2007
    
    
    2008
    
    
    2007
    
    
    2008
    
    
    2007DRA/CRT
    
    $
    42,495
    
    
    $
    47,738
    
    
    $
    (4,668
    )
    
    $
    (7,770
    )
    
    $
    (530
    )
    
    $
    (970
    )DRA/CLP
    
    
    28,397
    
    
    
    n/a
    
    
    
    (4,360
    )
    
    
    n/a
    
    
    
    (96
    )
    
    
    n/aOZRE
    
    
    8,583
    
    
    
    n/a
    
    
    
    (2,493
    )
    
    
    n/a
    
    
    
    (38
    )
    
    
    n/aGPT (1)
    
    
    8,191
    
    
    
    11,904
    
    
    
    (1,752
    )
    
    
    (2,625
    )
    
    
    11,977
    
    
    
    (136
    )$
    87,666
    
    
    $
    59,642
    
    
    $
    (13,273
    )
    
    $
    (10,395
    )
    
    $
    11,313
    
    
    $
    (1,106
    )
 
 (1)
    
    CRLP sold its interest in this joint venture in February 2008 and recognized a gain of
approximately $12.2 million. Note 10  Financing Activities
       20




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##### Table of Contents



Note 11  Derivatives and Hedging
    Note 12 Contingencies
  
    
    In connection with the dispute, in January 2008, the contractor filed a lawsuit
against CRLP alleging, among other things, breach of contract, enforcement of a lien
against real property, misrepresentation, conversion, declaratory judgment and an
accounting of costs, and is seeking $10.3 million in damages, plus consequential and
punitive damages.
    
    Certain of the subcontractors, vendors and other parties, involved in the
projects, including purchasers of units, have also made claims for payment in the
form of lien claims, general claims or lawsuits. As an example, CRLP was sued in
April 2008 by a purchaser of certain condominium units alleging breach of contract,
fraud, construction deficiencies and misleading sales practices, and is seeking
compensatory and punitive damages.
   21




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##### Table of Contents



Note 13  Subsequent Events
 Acquisitions
  Dispositions
  Financing Activities
   Distribution
  22




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##### Table of Contents



Report of Independent Registered Public Accounting Firm
 
     
  23




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##### Table of Contents



COLONIAL REALTY LIMITED PARTNERSHIP
 
 Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
  
    
    national and local economic, business and real estate conditions, including, but
not limited to, the effect of demand for multifamily units, office and retail rental
space, the extent, strength and duration of any economic recovery, such as the
effects on demand for units and rental space and the creation of new multifamily,
office and retail developments, availability and creditworthiness of tenants, the
level of lease rents, and the availability of financing for both tenants and us;
    
    adverse changes in real estate markets, including, but not limited to, the extent
of tenant bankruptcies, financial difficulties and defaults, the extent of future
demand for multifamily units and office and retail space in our core markets and
barriers of entry into new markets which we may seek to enter in the future, the
extent of decreases in rental rates, competition, our ability to identify and
consummate attractive acquisitions on favorable terms, our ability to consummate any
planned dispositions in a timely manner on acceptable terms, and our ability to
reinvest sales proceeds in a manner that generates favorable terms;
    
    increased exposure, as a multifamily focused real estate investment trust
(REIT), to risks inherent in investments in a single industry;
    
    actions, strategies and performance of affiliates that we may not control or
companies, including joint ventures, in which we have made investments;
    
    changes in operating costs, including real estate taxes, utilities, and
insurance;
    
    higher than expected construction costs;
    
    risks of development or conversion of for-sale projects including, but not
limited to, delays in obtaining required governmental permits and authorizations,
cost overruns, and operating deficits;
    
    legislative or other regulatory decisions, including government approvals,
actions and initiatives, including the need for compliance with environmental and
safety requirements, and changes in laws and regulations or the interpretation
thereof;
    
    effects of tax legislative action;
    
    our general partners ability to maintain its status as a REIT for federal income
tax purposes, our ability to maintain our status as a partnership for federal income
tax purposes, the ability of certain of our subsidiaries to maintain their status as
taxable REIT subsidiaries for federal income tax purposes, and our ability and the
ability of our subsidiaries to operate effectively within the limitations imposed by
these rules;
    
    effect of any rating agency actions on the cost and availability of new debt
financing;
    
    level and volatility of interest rates or capital market conditions;
    
    effect of any terrorist activity or other heightened geopolitical crisis;
    
    other factors affecting the real estate industry generally; and
    
    other risks identified in our 2007 Annual Report on Form 10-K and, from time to
time, in other reports we file with the Securities and Exchange Commission (the
SEC) or in other documents that we publicly disseminate.
  24




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##### Table of Contents



Overview
 As used herein, the terms CRLP, we, us, our and Operating Partnership refer to
Colonial Realty Limited Partnership, a Delaware limited partnership, and its subsidiaries and other
affiliates, including Colonial Properties Services Limited Partnership, Colonial Property Services,
Inc. and CLNL Acquisition Sub, LLC or, as the context may require, Colonial Realty Limited
Partnership only. As used herein, the term the Company or the Trust includes Colonial
Properties Trust, an Alabama real estate investment trust, and one or more of its subsidiaries and
other affiliates, including CRLP, Colonial Properties Services Limited Partnership, Colonial
Properties Services, Inc. and CLNL Acquisition Sub, LLC or, as the context may require, Colonial
Properties Trust only or Colonial Realty Limited Partnership only.
     25




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##### Table of Contents



Business Strategy
       Executive Summary of Results of Operations
   26




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##### Table of Contents




    
    Achieved Multifamily NOI growth of 4.5% compared to the first quarter of 2007;
    
    Office and Retail NOI and Rental revenues associated with our office and retail assets decreased due to:
 
    
    the office and retail joint venture transactions that were consummated during June 2007; and
    
    the outright sale of 16 retail assets during 2007;
 
    
    Completed the development of four multifamily properties consisting of 824 apartment homes;
    
    Repurchased $50.0 million of unsecured senior notes in separate transactions at an
average of 12% discount of par value and recognized gains of $5.5 million or $0.10 per
diluted share in net income; and
    
    Recognized a $9.1 million reduction in interest expense, an improvement of $0.16 per
diluted share in net income compared to the first quarter of 2007.
  Reconciliation of Operating Results Summary to Consolidated Condensed Statements of Income
  Three Months Ended March 31, 2008
    
    
    Three Months Ended March 31, 2007Continuing
    
    
    Discontinued
    
    
    
    
    
    
    Continuing
    
    
    DiscontinuedOperations
    
    
    Operations
    
    
    Total
    
    
    Operations
    
    
    Operations
    
    
    TotalRental revenues (1)
    
    $
    73,500
    
    
    $
    7,416
    
    
    $
    80,916
    
    
    $
    106,740
    
    
    $
    19,008
    
    
    $
    125,748Construction revenues
    
    
    7,879
    
    
    
    
    
    
    
    7,879
    
    
    
    12,785
    
    
    
    
    
    
    
    12,785Non-property related revenues
    
    
    5,299
    
    
    
    
    
    
    
    5,299
    
    
    
    3,243
    
    
    
    
    
    
    
    3,243Property operating expenses
(rental expense and real estate taxes)
    
    
    (28,599
    )
    
    
    (3,063
    )
    
    
    (31,662
    )
    
    
    (38,239
    )
    
    
    (7,863
    )
    
    
    (46,102
    )Construction expenses
    
    
    (7,266
    )
    
    
    
    
    
    
    (7,266
    )
    
    
    (12,371
    )
    
    
    
    
    
    
    (12,371
    )Property management expenses
    
    
    (2,241
    )
    
    
    
    
    
    
    (2,241
    )
    
    
    (3,490
    )
    
    
    
    
    
    
    (3,490
    )General and adminstrative expenses
    
    
    (5,780
    )
    
    
    
    
    
    
    (5,780
    )
    
    
    (5,978
    )
    
    
    
    
    
    
    (5,978
    )Management fee and other expenses
    
    
    (3,685
    )
    
    
    
    
    
    
    (3,685
    )
    
    
    (2,943
    )
    
    
    
    
    
    
    (2,943
    )Investment and development
    
    
    (769
    )
    
    
    
    
    
    
    (769
    )
    
    
    (138
    )
    
    
    
    
    
    
    (138
    )Depreciation and amortization
    
    
    (24,462
    )
    
    
    
    
    
    
    (24,462
    )
    
    
    (37,834
    )
    
    
    (2,796
    )
    
    
    (40,630
    )Interest expense and debt cost amortization
    
    
    (18,440
    )
    
    
    (227
    )
    
    
    (18,667
    )
    
    
    (27,534
    )
    
    
    (2,027
    )
    
    
    (29,561
    )Gains (losses) on retirement of debt
    
    
    5,471
    
    
    
    
    
    
    
    5,471
    
    
    
    (64
    )
    
    
    (2
    )
    
    
    (66
    )Income tax and other
    
    
    874
    
    
    
    
    
    
    
    874
    
    
    
    (233
    )
    
    
    
    
    
    
    (233
    )Interest income
    
    
    791
    
    
    
    
    
    
    
    791
    
    
    
    2,131
    
    
    
    2
    
    
    
    2,133Income from unconsolidated entities
    
    
    10,269
    
    
    
    
    
    
    
    10,269
    
    
    
    6,814
    
    
    
    
    
    
    
    6,814Gains, net of taxes
    
    
    1,931
    
    
    
    2,913
    
    
    
    4,844
    
    
    
    1,325
    
    
    
    34,801
    
    
    
    36,126Minority interest of limited partners
    
    
    5
    
    
    
    13
    
    
    
    18
    
    
    
    143
    
    
    
    (42
    )
    
    
    101Net income
    
    
    14,777
    
    
    
    7,052
    
    
    
    21,829
    
    
    
    4,357
    
    
    
    41,081
    
    
    
    45,438Dividends to preferred unitholders
    
    
    (4,315
    )
    
    
    
    
    
    
    (4,315
    )
    
    
    (6,303
    )
    
    
    
    
    
    
    (6,303
    )Preferred share issuance costs write-off
    
    
    (271
    )
    
    
    
    
    
    
    (271
    )
    
    
    
    
    
    
    
    
    
    
    Net income (loss) available to common unitholders
    
    $
    10,191
    
    
    $
    7,052
    
    
    $
    17,243
    
    
    $
    (1,946
    )
    
    $
    41,081
    
    
    $
    39,135
 
 (1)
    
    Rental revenues include minimum rent, tenant recoveries and other property related revenue
from our Consolidated Condensed Statements of Income. 27




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##### Table of Contents



Operating Results Summary
  (amounts in thousands)
 Three Months Ended March 31,2008
    
    
    2007
    
    
    VarianceRental revenues:Multifamily
    
    $
    76,077
    
    
    $
    73,917
    
    
    $
    2,160Office
    
    
    1,467
    
    
    
    30,199
    
    
    
    (28,732
    )Retail
    
    
    3,372
    
    
    
    21,632
    
    
    
    (18,260
    )Total rental revenues
    
    
    80,916
    
    
    
    125,748
    
    
    
    (44,832
    )Property operating expenses (rental expenses and real estate taxes):Multifamily
    
    
    (30,121
    )
    
    
    (29,959
    )
    
    
    (162
    )Office
    
    
    (336
    )
    
    
    (9,844
    )
    
    
    9,508Retail
    
    
    (1,205
    )
    
    
    (6,299
    )
    
    
    5,094Total property operating expenses
    
    
    (31,662
    )
    
    
    (46,102
    )
    
    
    14,440Net operating income (rental revenues less property operating expenses)(1)
    
    $
    49,254
    
    
    $
    79,646
    
    
    
    (30,392
    )Multifamily Margin (NOI/rental revenues) (2):
    
    
    60.4
    %
    
    
    59.5
    %
    
    
    0.9
    %Multifamily occupancy at end of period:
    
    
    96.2
    %
    
    
    96.0
    %
    
    
    0.2
    %Construction revenues
    
    
    7,879
    
    
    
    12,785
    
    
    
    (4,906
    )Construction expenses
    
    
    (7,266
    )
    
    
    (12,371
    )
    
    
    5,105Non-property related revenues
    
    
    5,299
    
    
    
    3,243
    
    
    
    2,056Depreciation & amortization
    
    
    (24,462
    )
    
    
    (40,630
    )
    
    
    16,168Property management expenses
    
    
    (2,241
    )
    
    
    (3,490
    )
    
    
    1,249General and administrative expenses
    
    
    (5,780
    )
    
    
    (5,978
    )
    
    
    198Management fee and other expense
    
    
    (3,685
    )
    
    
    (2,943
    )
    
    
    (742
    )Investment and development
    
    
    (769
    )
    
    
    (138
    )
    
    
    (631
    )Interest expense & debt cost amortization
    
    
    (18,667
    )
    
    
    (29,561
    )
    
    
    10,894Gains (losses) on retirement of debt
    
    
    5,471
    
    
    
    (66
    )
    
    
    5,537Interest income
    
    
    791
    
    
    
    2,133
    
    
    
    (1,342
    )Income taxes and other
    
    
    874
    
    
    
    (233
    )
    
    
    1,107Earnings from continuing and discontinued operations
    
    
    6,698
    
    
    
    2,397
    
    
    
    4,301Equity in earnings from unconsolidated entities
    
    
    10,269
    
    
    
    6,814
    
    
    
    3,455Gains from sale of property, net of income taxes
    
    
    4,844
    
    
    
    36,126
    
    
    
    (31,282
    )Minority interest of limited partners
    
    
    18
    
    
    
    101
    
    
    
    (83
    )Net income
    
    
    21,829
    
    
    
    45,438
    
    
    
    (23,609
    )
 
 (1)
    
    Net operating income is a non-GAAP financial measure. See discussion related to this
measure above under Executive Summary of Results of Operations. Multifamily NOI can be
calculated by subtracting multifamily operating expenses from multifamily rental revenues.
Office NOI and Retail NOI each can be calculated by subtracting operating expenses from
rental revenues.(2)
    
    Multifamily Margin is calculated by adding multifamily rental revenues, subtracting
multifamily operating expenses and dividing the difference by multifamily rental revenues.(3)
    
    Multifamily occupancy at end of period consists of physical occupancy for consolidated
properties in our multifamily division at the end of the applicable period. 28




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##### Table of Contents



Multifamily analysis
   Commercial property analysis
  Construction activities
  Non-property related revenues
  Property management expenses
  Management fee and other expenses
  29




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##### Table of Contents



Investment and development
  Depreciation and amortization expenses
  Interest expense and debt cost amortization
  Gains (losses) on retirement of debt
  Income taxes and other
  Equity in earnings from unconsolidated entities
  Gains from sales of property
  Distributions to preferred unitholders
  30




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##### Table of Contents



Discontinued Operations
  Liquidity and Capital Resources
 Overview
    Strategic Initiative
  Credit Ratings
  Rating Agency
    
    Rating
    
    Last updateStandard & Poors
    
    BBB-(1)
    
    January 18, 2008Moodys
    
    Baa3(2)
    
    September 27, 2007Fitch
    
    BBB-(1)
    
    April 1, 2008
 
 (1)
    
    Ratings outlook is stable.(2)
    
    Ratings outlook is negative.   31




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##### Table of Contents



Short-Term Liquidity Needs
      Long-Term Liquidity Needs
   32




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##### Table of Contents



Unsecured Revolving Credit Facilities
      33




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##### Table of Contents



Investing Activities
     34




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##### Table of Contents



Distributions
  Contingencies
  
    
    In connection with the dispute, in January 2008, the contractor filed a lawsuit
against us alleging, among other things, breach of contract, enforcement of a lien
against real property, misrepresentation, conversion, declaratory judgment and an
accounting of costs, and is seeking $10.3 million in damages, plus consequential and
punitive damages.
    
    Certain of the subcontractors, vendors and other parties, involved in the
projects, including purchasers of units, have also made claims for payment in the
form of lien claims, general claims or lawsuits. As an example, we were sued in
April 2008 by a purchaser of certain condominium units alleging breach of contract,
fraud, construction deficiencies and misleading sales practices, and is seeking
compensatory and punitive damages.
      Off-Balance Sheet Arrangements
  35




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##### Table of Contents



Critical Accounting Policies and Estimates
  Investment and Development
  Assets and Liabilities Measured at Fair Value
 Fair Value
Measurements
   Derivatives and Hedging
    36




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##### Table of Contents



Inflation
   
 Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
 Item 4. Controls and Procedures
 (a)
    
    Disclosure controls and procedures.
  (b)
    
    Changes in internal control over financial reporting.
  
 PART II  OTHER INFORMATION
 
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  37




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Item 6. Exhibits
  38




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SIGNATURES
  COLONIAL REALTY LIMITED PARTNERSHIP,
A Delaware limited partnershipBy:
    Colonial Properties Trust,Its General Partner Date:  May 9, 2008
    By:
    /s/ Weston M. AndressWeston M. AndressPresident and Chief Financial Officer Date:  May 9, 2008
    By:
    /s/  John E. TomlinsonJohn E. TomlinsonExecutive Vice President &
Chief Accounting Officer
(Principal Accounting Officer) 39




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##### Table of Contents



Index of Exhibits
 12.1
    
    Ratio of Earnings to Fixed Charges
    
    Filed herewith
    
    Page 4115.1
    
    Letter re: Unaudited Interim Financial Information
    
    Filed herewith
    
    Page 4231.1
    
    CEO Certification pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002
    
    Filed herewith
    
    Page 4331.2
    
    CFO Certification pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002
    
    Filed herewith
    
    Page 4432.1
    
    CEO Certification pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
    
    Filed herewith
    
    Page 4532.2
    
    CFO Certification pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
    
    Filed herewith
    
    Page 46
 40