##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 (Mark One)
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
  Or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
  001-32417
 Education Realty Trust, Inc.
  Maryland
    
    20-1352180(State or other jurisdiction of incorporation or organization)
    
    (I.R.S. Employer Identification No.)530 Oak Court Drive, Suite 300, Memphis, Tennessee
    
    38117(Address of principal executive offices)
    
    (Zip Code)
  þ o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ




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##### 



EDUCATION REALTY TRUST, INC.  FORM 10-Q  QUARTER ENDED MARCH 31, 2008  TABLE OF CONTENTS
 PagePART IFINANCIAL INFORMATIONItem 1. Financial Statements
    
    
    3Condensed Consolidated Balance Sheets of Education Realty Trust, Inc. and Subsidiaries as of
March 31, 2008 and December 31, 2007
    
    
    3Condensed Consolidated Statements of Operations of Education Realty Trust, Inc. and
Subsidiaries for the three months ended March 31, 2008 and 2007
    
    
    4Condensed Consolidated Statements of Cash Flows of Education Realty Trust, Inc. and
Subsidiaries for the three months ended March 31, 2008 and 2007
    
    
    5Notes to Condensed Consolidated Financial Statements
    
    
    7Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    19Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    32Item 4. Controls and Procedures
    
    
    32PART II  OTHER INFORMATION
    
    
    34Item 1. Legal Proceedings
    
    
    34Item 1A. Risk Factors
    
    
    34Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    34Item 3. Defaults Upon Senior Securities
    
    
    34Item 4. Submission of Matters to a Vote of Security Holders
    
    
    34Item 5. Other Information
    
    
    34Item 6. Exhibits
    
    
    34Signatures
    
    
    35EX-31.1 SECTION 302 CERTIFICATION OF THE CEOEX-31.2 SECTION 302 CERTIFICATION OF THE CFOEX-32.1 SECTION 906 CERTIFICATION OF THE CEOEX-32.2 SECTION 906 CERTIFICATION OF THE CFO
  2




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Part I  Financial Information
 
 Item 1. Financial Statements.
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 March 31, 2008
    
    
    December 31, 2007(Unaudited)ASSETSAssets:Student housing properties, net
    
    $
    722,755
    
    
    $
    732,979Assets under development
    
    
    10,532
    
    
    
    5,675Corporate office furniture, net
    
    
    1,587
    
    
    
    1,693Cash and cash equivalents
    
    
    3,056
    
    
    
    4,034Restricted cash
    
    
    7,401
    
    
    
    8,188Student contracts receivable, net
    
    
    430
    
    
    
    329Receivable from affiliate
    
    
    52
    
    
    
    18Management fee receivable from third party
    
    
    579
    
    
    
    606Goodwill and other intangibles, net
    
    
    3,527
    
    
    
    3,531Other assets
    
    
    10,887
    
    
    
    10,407Total assets
    
    $
    760,806
    
    
    $
    767,460LIABILITIES AND STOCKHOLDERS EQUITYLiabilities:Mortgage loans, net of unamortized premium/discount
    
    $
    396,835
    
    
    $
    420,940Revolving line of credit
    
    
    34,800
    
    
    
    11,500Accounts payable and accrued expenses
    
    
    10,306
    
    
    
    11,092Accounts payable affiliate
    
    
    126
    
    
    
    60Deferred revenue
    
    
    8,638
    
    
    
    7,928Total liabilities
    
    
    450,705
    
    
    
    451,520Minority interest
    
    
    17,028
    
    
    
    18,121Commitments and contingencies (see Note 6)
    
    
    
    
    
    
    Stockholders equity:Common stock, $.01 par value, 200,000,000 shares
authorized, 28,444,855 and 28,431,855 shares
issued and outstanding at March 31, 2008 and
December 31, 2007, respectively
    
    
    284
    
    
    
    284Preferred shares, $0.01 par value, 50,000,000
shares authorized, no shares issued and
outstanding
    
    
    
    
    
    
    Additional paid-in capital
    
    
    325,334
    
    
    
    330,969Accumulated deficit
    
    
    (32,545
    )
    
    
    (33,434
    )Total stockholders equity
    
    
    293,073
    
    
    
    297,819Total liabilities and stockholders equity
    
    $
    760,806
    
    
    $
    767,460
 See accompanying notes to the condensed consolidated financial statements.
 3




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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 Three months
    
    
    Three monthsended
    
    
    endedMarch 31,
    
    
    March 31,2008
    
    
    2007Revenues:Student housing leasing revenue
    
    $
    26,353
    
    
    $
    21,971Student housing food service revenue
    
    
    655
    
    
    
    580Other leasing revenue
    
    
    1,945
    
    
    
    3,434Third-party development services
    
    
    1,787
    
    
    
    1,043Third-party management services
    
    
    975
    
    
    
    882Operating expense reimbursements
    
    
    2,619
    
    
    
    2,156Total revenues
    
    
    34,334
    
    
    
    30,066Operating expenses:Student housing leasing operations
    
    
    12,085
    
    
    
    9,022Student housing food service operations
    
    
    633
    
    
    
    561General and administrative
    
    
    3,937
    
    
    
    3,490Depreciation and amortization
    
    
    7,593
    
    
    
    8,080Reimbursable operating expenses
    
    
    2,619
    
    
    
    2,156Total operating expenses
    
    
    26,867
    
    
    
    23,309Operating income
    
    
    7,467
    
    
    
    6,757Nonoperating expenses:Interest expense
    
    
    6,164
    
    
    
    7,387Amortization of deferred financing costs
    
    
    243
    
    
    
    280Interest income
    
    
    (118
    )
    
    
    (84
    )Total nonoperating expenses
    
    
    6,289
    
    
    
    7,583Income (loss) before equity in earnings (losses) of unconsolidated entities, income
taxes, minority interest and discontinued operations
    
    
    1,178
    
    
    
    (826
    )Equity in earnings (losses) of unconsolidated entities
    
    
    (1
    )
    
    
    43Income (loss) before income taxes, minority interest and discontinued operations
    
    
    1,177
    
    
    
    (783
    )Income tax expense (benefit)
    
    
    191
    
    
    
    (2
    )Net income (loss) before minority interest and discontinued operations
    
    
    986
    
    
    
    (781
    )Minority interest
    
    
    97
    
    
    
    118Income (loss) from continuing operations
    
    
    889
    
    
    
    (899
    )Income from discontinued operations, net of minority interest of $0 and $18, respectively
    
    
    
    
    
    
    408Net income (loss)
    
    $
    889
    
    
    $
    (491
    )Earnings per share informationIncome (loss) per share  basic:Continuing operations
    
    $
    0.03
    
    
    $
    (0.03
    )Discontinued operations
    
    
    
    
    
    
    0.01Net income (loss) per share
    
    $
    0.03
    
    
    $
    (0.02
    )Income (loss) per share  diluted:Continuing operations
    
    $
    0.03
    
    
    $
    (0.03
    )Discontinued operations
    
    
    
    
    
    
    0.01Net income (loss) per share
    
    $
    0.03
    
    
    $
    (0.02
    )Weighted average common shares outstanding  basic
    
    
    28,438,224
    
    
    
    27,173,475Weighted average common shares outstanding  diluted
    
    
    29,607,829
    
    
    
    27,173,475Distributions per common share
    
    $
    0.205
    
    
    $
    0.205
 See accompanying notes to the condensed consolidated financial statements.
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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 Three months
    
    
    Three monthsended
    
    
    endedMarch 31,
    
    
    March 31,2008
    
    
    2007Operating activities:Net income (loss)
    
    $
    889
    
    
    $
    (491
    )Adjustments to reconcile net income (loss) to net cash provided by operating activities:Depreciation and amortization
    
    
    7,593
    
    
    
    8,080Depreciation included in discontinued operations
    
    
    
    
    
    
    469Deferred taxes
    
    
    (144
    )
    
    
    (49
    )Loss on disposal of assets
    
    
    513
    
    
    
    Gain on early repayment of debt
    
    
    
    
    
    
    (36
    )Amortization of deferred financing costs
    
    
    243
    
    
    
    280Amortization of unamortized debt premiums/discounts
    
    
    (159
    )
    
    
    (54
    )Distributions of earnings from unconsolidated entities
    
    
    58
    
    
    
    103Noncash compensation expense related to PIUs and restricted stock
    
    
    213
    
    
    
    243Equity in earnings of unconsolidated entities
    
    
    1
    
    
    
    (43
    )Minority interest in continuing operations
    
    
    97
    
    
    
    118Minority interest in discontinued operations
    
    
    
    
    
    
    18Change in operating assets and liabilities (net of student housing
acquisitions/disposals)
    
    
    (510
    )
    
    
    (4,842
    )Net cash provided by operating activities
    
    
    8,794
    
    
    
    3,796Investing activities:Purchase of corporate furniture and fixtures
    
    
    (27
    )
    
    
    (72
    )Restricted cash
    
    
    787
    
    
    
    523Investment in student housing properties
    
    
    (1,322
    )
    
    
    (890
    )Proceeds from sale of assets
    
    
    2,578Investment in assets under development
    
    
    (4,857
    )Investment in joint ventures
    
    
    (76
    )
    
    
    (30
    )Net cash used in investing activities
    
    
    (2,917
    )
    
    
    (469
    )Financing activities:Payment of mortgage notes
    
    
    (23,945
    )
    
    
    (30,906
    )Borrowings of mortgage notes
    
    
    
    
    
    
    30,800Repayment of term loan
    
    
    
    
    
    
    (5,500
    )Borrowing (repayment) of line of credit, net
    
    
    23,300
    
    
    
    (1,600
    )Debt issuance costs
    
    
    (67
    )
    
    
    (324
    )Proceeds from issuance of common stock
    
    
    
    
    
    
    11,217Dividends and distributions paid
    
    
    (6,143
    )
    
    
    (5,861
    )Net cash used in financing activities
    
    
    (6,855
    )
    
    
    (2,174
    )Net increase (decrease) in cash and cash equivalents
    
    
    (978
    )
    
    
    1,153Cash and cash equivalents, beginning of period
    
    
    4,034
    
    
    
    6,427Cash and cash equivalents, end of period
    
    $
    3,056
    
    
    $
    7,580
 See accompanying notes to the condensed consolidated financial statements.
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Three months
    
    
    Three monthsended
    
    
    endedMarch 31,
    
    
    March 31,2008
    
    
    2007Supplemental disclosure of cash flow information:Interest paid
    
    $
    6,344
    
    
    $
    6,976Income taxes paid
    
    $
    
    
    
    $
    148Supplemental disclosure of noncash activities:Warrants expired
    
    $
    
    
    
    $
    375Redemption of minority interest from unit holder
    
    
    893
    
    
    
    Common stock issued under the dividend reinvestment plan
    
    
    
    
    
    
    41
 See accompanying notes to the condensed consolidated financial statements.
 6




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NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 
 1. Organization and description of business
    
    
    Allen & OHara Education Services, Inc. (AOES), a Delaware
corporation performing student housing management activities.
    
    Allen & OHara Development Company, LLC (AODC), a Delaware limited
liability company providing development consulting services for third
party student housing properties.
  2. Summary of significant accounting policies
 Basis of presentation and principles of consolidation
    Interim financial information
  7




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Use of estimates
  Cash and cash equivalents
  Restricted cash
  Distributions
  Student housing properties
  Business
Combinations,
 Accounting for
the Impairment and Disposal of Long-lived Assets.
 8




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Repairs, maintenance and major improvements
  Investment in unconsolidated joint ventures, limited liability companies and limited partnerships
  Deferred financing costs
  Issuance costs
  Debt premiums/discounts
  Income taxes
  9




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Accounting for Income Taxes,
 Accounting for Uncertainty in Income Taxes
 Earnings per share
 Earnings Per Share.
 Basic weighted average commons shares outstanding
    
    
    28,438,224Operating Partnership units
    
    
    913,738University Towers Operating Partnership units
    
    
    255,867Diluted weighted average common shares outstanding
    
    
    29,607,829
  Goodwill and other intangible assets
 Goodwill and
Other Intangible Assets.
 Minority interests
  Comprehensive Income
 Reporting Comprehensive Income
 10




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Revenue recognition
  Student housing leasing revenue
 Student housing food service revenue
 Other leasing revenue
 Third-party development services revenue
 Third-party management services revenue
 Operating expense reimbursements Income Statement Characterization of Reimbursements Received for Out of Pocket
Expenses Incurred.
 11




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Recent accounting pronouncements
 Fair
Value Measurements .
 The Fair Value Option for Financial Assets and
Financial Liabilities ,
 Business Combinations
 Noncontrolling Interests in Consolidated Financial
Statementsan amendment of Accounting Research Bulletin No. 51
 Disclosures about Derivative Instruments and Hedging
Activities-an amendment of FASB Statement No. 133 Accounting for Derivative
Instruments and Hedging Activities
 3. Investments in unconsolidated entities
  
    
    University Village-Greensboro LLC, a Delaware limited liability company, 25% owned by the Operating Partnership
    
    WEDR Riverside Investors V, LLC, a Delaware limited liability company, 10% owned by the Operating Partnership
 12




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
    
    APF EDR, LP, a Delaware limited partnership, 10% owned by the Operating Partnership
    
    APF EDR Food Services, LP, a Delaware limited partnership, 10% owned by the Operating Partnership
    
    WEDR Stinson Investors V, LLC, a Delaware limited liability company, 10% owned by the Operating Partnership
  2008
    
    2007Results of Operations:Revenues
    
    $
    4,359
    
    
    $
    3,478Net loss
    
    
    (192
    )
    
    
    (644
    )Equity in earnings (losses) of unconsolidated entities
    
    $
    (1
    )
    
    $
    43
  4. Debt
 Revolving credit facility
      13




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Mortgage debt
  Fiscal Year Ending2008 (9 months ending December 31, 2008)
    
    $
    2,5362009
    
    
    285,0492010
    
    
    8882011
    
    
    9472012
    
    
    65,315Thereafter
    
    
    40,587Total
    
    
    395,322Unamortized debt premium/discounts
    
    
    1,513Outstanding at March 31, 2008, net of unamortized premiums/discounts
    
    $
    396,835
  5. Segments
  Three Months Ended March 31, 2008
    
    
    Three Months Ended March 31, 2007Third-Party
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Third-PartyStudent
    
    
    Development
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Student
    
    
    DevelopmentHousing
    
    
    Consulting
    
    
    Management
    
    
    
    
    
    
    
    
    
    
    Housing
    
    
    Consulting
    
    
    ManagementLeasing
    
    
    Services
    
    
    Services
    
    
    Adjustments
    
    
    Total
    
    
    Leasing
    
    
    Services
    
    
    Services
    
    
    Adjustments
    
    
    TotalRevenues:Student housing
leasing revenue
    
    $
    26,353
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    26,353
    
    
    $
    21,971
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    21,971Student housing
food service
revenue
    
    
    655
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    655
    
    
    
    580
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    580Other leasing
revenue
    
    
    1,945
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,945
    
    
    
    3,434
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,434Third-party
development
consulting
services
    
    
    
    
    
    
    1,787
    
    
    
    
    
    
    
    
    
    
    
    1,787
    
    
    
    
    
    
    
    1,043
    
    
    
    
    
    
    
    
    
    
    
    1,043Third-party
management
services
    
    
    
    
    
    
    
    
    
    
    975
    
    
    
    
    
    
    
    975
    
    
    
    
    
    
    
    
    
    
    
    882
    
    
    
    
    
    
    
    882Intersegment
revenues
    
    
    
    
    
    
    
    
    
    
    1,042
    
    
    
    (1,042
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    937
    
    
    
    (937
    )
    
    
    Operating expense
reimbursements
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,619
    
    
    
    2,619
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,156
    
    
    
    2,156Total revenues
    
    
    28,953
    
    
    
    1,787
    
    
    
    2,017
    
    
    
    1,577
    
    
    
    34,334
    
    
    
    25,985
    
    
    
    1,043
    
    
    
    1,819
    
    
    
    1,219
    
    
    
    30,066Operating expenses:
 14




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##### Table of Contents



Three Months Ended March 31, 2008
    
    
    Three Months Ended March 31, 2007Third-Party
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Third-PartyStudent
    
    
    Development
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Student
    
    
    DevelopmentHousing
    
    
    Consulting
    
    
    Management
    
    
    
    
    
    
    
    
    
    
    Housing
    
    
    Consulting
    
    
    ManagementLeasing
    
    
    Services
    
    
    Services
    
    
    Adjustments
    
    
    Total
    
    
    Leasing
    
    
    Services
    
    
    Services
    
    
    Adjustments
    
    
    TotalStudent housing
leasing operations
    
    
    12,085
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12,085
    
    
    
    9,022
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,022Student housing
food service
operations
    
    
    633
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    633
    
    
    
    561
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    561General and
administrative
    
    
    3
    
    
    
    731
    
    
    
    1,798
    
    
    
    
    
    
    
    2,532
    
    
    
    43
    
    
    
    674
    
    
    
    1,879
    
    
    
    
    
    
    
    2,596Intersegment
expenses
    
    
    1,042
    
    
    
    
    
    
    
    
    
    
    
    (1,042
    )
    
    
    
    
    
    
    937
    
    
    
    
    
    
    
    
    
    
    
    (937
    )
    
    
    Reimbursable
operating expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,619
    
    
    
    2,619
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,156
    
    
    
    2,156Total operating
expenses
    
    
    13,763
    
    
    
    731
    
    
    
    1,798
    
    
    
    1,577
    
    
    
    17,869
    
    
    
    10,563
    
    
    
    674
    
    
    
    1,879
    
    
    
    1,219
    
    
    
    14,335Net operating
income (loss)
    
    
    15,190
    
    
    
    1,056
    
    
    
    219
    
    
    
    
    
    
    
    16,465
    
    
    
    15,422
    
    
    
    369
    
    
    
    (60
    )
    
    
    
    
    
    
    15,731Nonoperating
expenses(1)
    
    
    13,644
    
    
    
    (31
    )
    
    
    
    
    
    
    
    
    
    
    13,613
    
    
    
    15,161
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,161Income (loss)
before equity in
earnings of
unconsolidated
entities, income
taxes, minority
interest and
discontinued
operations
    
    
    1,546
    
    
    
    1,087
    
    
    
    219
    
    
    
    
    
    
    
    2,852
    
    
    
    261
    
    
    
    369
    
    
    
    (60
    )
    
    
    
    
    
    
    570Equity in earnings
of unconsolidated
entities
    
    
    
    
    
    
    (1
    )
    
    
    
    
    
    
    
    
    
    
    (1
    )
    
    
    (97
    )
    
    
    140
    
    
    
    
    
    
    
    
    
    
    
    43Income (loss)
before taxes,
minority interest
and discontinued
operations(3)
    
    $
    1,546
    
    
    $
    1,086
    
    
    $
    219
    
    
    $
    
    
    
    $
    2,851
    
    
    $
    164
    
    
    $
    509
    
    
    $
    (60
    )
    
    $
    
    
    
    $
    613Total segment
assets, as of March
31, 2008 and
December 31,
2007(2)
    
    $
    745,188
    
    
    $
    4,807
    
    
    $
    5,634
    
    
    $
    
    
    
    $
    755,629
    
    
    $
    751,086
    
    
    $
    4,528
    
    
    $
    6,505
    
    
    $
    
    
    
    $
    762,119
 
 (1)
    
    Nonoperating expenses include interest expense, interest income, amortization of deferred financing costs, depreciation, and amortization of intangibles.(2)
    
    The decrease in segment assets related to student housing leasing from that presented at December 31, 2007 relates to the disposition of the parking
garage and land related to University Towers as described in Note 8 and normal depreciation in the first three months of 2008. The decrease in segment
assets related to third party management services is primarily due to a decrease in operating cash at the end of the quarter.(3)
    
    The following is a reconciliation of the reportable segments net income before income taxes, minority interest and discontinued operations to the
Trusts consolidated net income (loss) before income taxes, minority interest and discontinued operations: 2008
    
    
    2007Net income before income taxes, minority interest and discontinued operations for reportable segments
    
    $
    2,851
    
    
    $
    613Other unallocated corporate expenses
    
    
    (1,674
    )
    
    
    (1,396
    )Net income (loss) before income taxes, minority interest and discontinued operations
    
    $
    1,177
    
    
    $
    (783
    )
 15




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##### Table of Contents



6. Commitments and contingencies
         7. Acquisition of real estate investments
  16




---



##### Table of Contents



8. Disposition of real estate investments and discontinued operations
   2007Student housing leasing revenue
    
    $
    1,524Student housing leasing operating expenses
    
    
    629Depreciation and amortization
    
    
    469Minority interest
    
    
    18Income from discontinued operations (net of minority interest)
    
    $
    408
 9. Incentive plan
    17




---



##### Table of Contents



RestrictedPIUs
    
    Stock
    
    TotalOutstanding at December 31, 2007
    
    
    277,500
    
    
    
    200,000
    
    
    
    477,500Granted
    
    
    2,500
    
    
    
    4,000
    
    
    
    6,500Redeemed
    
    
    (2,500
    )
    
    
    
    
    
    
    (2,500
    )Outstanding at March 31, 2008
    
    
    277,500
    
    
    
    204,000
    
    
    
    481,500Vested at March 31, 2008
    
    
    277,500
    
    
    
    137,889
    
    
    
    415,389
  10. Subsequent events
  18




---



##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.
  The following discussion should be read in conjunction with the financial statements and notes
thereto appearing elsewhere in this Quarterly Report. Certain statements contained in this filing
are forward-looking statements within the meaning of the Private Securities Litigation Reform Act
of 1995, including but not limited to statements related to plans for future acquisitions, our
business and investment strategy, market trends and projected capital expenditures. When used in
this report, the words expect, anticipate, intend, plan, believe, seek, estimate,
would, could, should, and similar expressions are generally intended to identify
forward-looking statements. You should not place undue reliance on these forward-looking
statements, which reflect our opinions only as of the date of this Quarterly Report. We assume no
obligation to update or supplement forward-looking statements that become untrue because of
subsequent events. Forward-looking statements are subject to risks, uncertainties and other factors
that could cause actual results to differ materially from future results expressed or implied by
such forward-looking statements. For further information about these and other factors that could
affect our future results, please see the Item 1A.  Risk Factors in our Annual Report on Form
10-K for the year ended December 31, 2007. Investors are cautioned that any forward-looking
statements are not guarantees of future performance and involve risks and uncertainties, and that
actual results may differ materially from those contemplated by such forward-looking statements.
 Overview
   Our Business Segments
  Student Housing Leasing
   19




---



##### Table of Contents



Management Services
  Third-Party Development Consulting Services
   20




---



##### Table of Contents



Trends and Outlook
 Rents and Occupancy
   General and Administrative Costs
  Termination of Lease with Place Properties, Inc.
  Critical Accounting Policies
  21




---



##### Table of Contents



Student Housing Leasing Revenue Recognition
   Student Housing Food Service Revenue Recognition
  Other Leasing Revenue Recognition
  Revenue and Cost Recognition of Third-Party Development Consulting Services
  22




---



##### Table of Contents



Student Housing Property Acquisitions and Dispositions
  Business Combinations
 Accounting for the Impairment and Disposal of Long Lived Assets
 Repairs and Maintenance
  Long Lived Assets  Impairment
 .
 Recently Issued Accounting Pronouncements
 Business Combinations
 23




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##### Table of Contents



Noncontrolling Interests in Consolidated Financial
Statementsan amendment of Accounting Research Bulletin No. 51
 Disclosures about Derivative Instruments and Hedging
Activities-an amendment of FASB Statement No. 133 Accounting for Derivative
Instruments and Hedging Activities
 Results of Operations for the Three Months Ended March 31, 2008 and 2007
  Three Months Ended March 31, 2008
    
    
    Three Months Ended March 31, 2007Third-Party
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Third-PartyStudent
    
    
    Development
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Student
    
    
    DevelopmentHousing
    
    
    Consulting
    
    
    Management
    
    
    
    
    
    
    
    
    
    
    Housing
    
    
    Consulting
    
    
    ManagementLeasing
    
    
    Services
    
    
    Services
    
    
    Adjustments
    
    
    Total
    
    
    Leasing
    
    
    Services
    
    
    Services
    
    
    Adjustments
    
    
    TotalRevenues:Student housing
leasing revenue
    
    $
    26,353
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    26,353
    
    
    $
    21,971
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    21,971Student housing
food service
revenue
    
    
    655
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    655
    
    
    
    580
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    580Other leasing
revenue
    
    
    1,945
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,945
    
    
    
    3,434
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,434Third-party
development
consulting
services
    
    
    
    
    
    
    1,787
    
    
    
    
    
    
    
    
    
    
    
    1,787
    
    
    
    
    
    
    
    1,043
    
    
    
    
    
    
    
    
    
    
    
    1,043Third-party
management
services
    
    
    
    
    
    
    
    
    
    
    975
    
    
    
    
    
    
    
    975
    
    
    
    
    
    
    
    
    
    
    
    882
    
    
    
    
    
    
    
    882Intersegment
revenues
    
    
    
    
    
    
    
    
    
    
    1,042
    
    
    
    (1,042
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    937
    
    
    
    (937
    )
    
    
    Operating expense
reimbursements
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,619
    
    
    
    2,619
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,156
    
    
    
    2,156Total revenues
    
    
    28,953
    
    
    
    1,787
    
    
    
    2,017
    
    
    
    1,577
    
    
    
    34,334
    
    
    
    25,985
    
    
    
    1,043
    
    
    
    1,819
    
    
    
    1,219
    
    
    
    30,066Operating expenses:
 24




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##### Table of Contents



Three Months Ended March 31, 2008
    
    
    Three Months Ended March 31, 2007Third-Party
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Third-PartyStudent
    
    
    Development
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Student
    
    
    DevelopmentHousing
    
    
    Consulting
    
    
    Management
    
    
    
    
    
    
    
    
    
    
    Housing
    
    
    Consulting
    
    
    ManagementLeasing
    
    
    Services
    
    
    Services
    
    
    Adjustments
    
    
    Total
    
    
    Leasing
    
    
    Services
    
    
    Services
    
    
    Adjustments
    
    
    TotalStudent housing
leasing operations
    
    
    12,085
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12,085
    
    
    
    9,022
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,022Student housing
food service
operations
    
    
    633
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    633
    
    
    
    561
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    561General and
administrative
    
    
    3
    
    
    
    731
    
    
    
    1,798
    
    
    
    
    
    
    
    2,532
    
    
    
    43
    
    
    
    674
    
    
    
    1,879
    
    
    
    
    
    
    
    2,596Intersegment
expenses
    
    
    1,042
    
    
    
    
    
    
    
    
    
    
    
    (1,042
    )
    
    
    
    
    
    
    937
    
    
    
    
    
    
    
    
    
    
    
    (937
    )
    
    
    Reimbursable
operating expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,619
    
    
    
    2,619
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,156
    
    
    
    2,156Total operating
expenses
    
    
    13,763
    
    
    
    731
    
    
    
    1,798
    
    
    
    1,577
    
    
    
    17,869
    
    
    
    10,563
    
    
    
    674
    
    
    
    1,879
    
    
    
    1,219
    
    
    
    14,335Net operating
income (loss)
    
    
    15,190
    
    
    
    1,056
    
    
    
    219
    
    
    
    
    
    
    
    16,465
    
    
    
    15,422
    
    
    
    369
    
    
    
    (60
    )
    
    
    
    
    
    
    15,731Nonoperating
expenses(1)
    
    
    13,644
    
    
    
    (31
    )
    
    
    
    
    
    
    
    
    
    
    13,613
    
    
    
    15,161
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,161Income (loss)
before equity in
earnings of
unconsolidated
entities, income
taxes, minority
interest and
discontinued
operations
    
    
    1,546
    
    
    
    1,087
    
    
    
    219
    
    
    
    
    
    
    
    2,852
    
    
    
    261
    
    
    
    369
    
    
    
    (60
    )
    
    
    
    
    
    
    570Equity in earnings
of unconsolidated
entities
    
    
    
    
    
    
    (1
    )
    
    
    
    
    
    
    
    
    
    
    (1
    )
    
    
    (97
    )
    
    
    140
    
    
    
    
    
    
    
    
    
    
    
    43Income (loss)
before taxes,
minority interest
and discontinued
operations(2)
    
    $
    1,546
    
    
    $
    1,086
    
    
    $
    219
    
    
    $
    
    
    
    $
    2,851
    
    
    $
    164
    
    
    $
    509
    
    
    $
    (60
    )
    
    $
    
    
    
    $
    613
 
 (1)
    
    Nonoperating expenses include interest expense, interest income, amortization of deferred financing costs, depreciation and amortization of intangibles.(2)
    
    The following is a reconciliation of the reportable segments net income (loss) before income taxes, minority interest and discontinued operations to EDRs consolidated net income (loss) before income taxes, minority interest and discontinued
operations determined under generally accepted accounting principles:
 2008
    
    
    2007Net income before taxes, minority interest and discontinued operations for reportable segments
    
    
    2,851
    
    
    
    613Other unallocated corporate expenses
    
    
    (1,674
    )
    
    
    (1,396
    )Net income (loss) before taxes, minority interest and discontinued operations
    
    $
    1,177
    
    
    $
    (783
    )
 Student housing leasing
  Three months
    
    Three monthsended
    
    endedMarch 31,
    
    March 31,2008
    
    2007(9)
    
    DifferenceOccupancyPhysical (1)
    
    
    93.4
    %
    
    
    95.3
    %
    
    
    -1.9
    %Economic (2)
    
    
    93.9
    %
    
    
    96.0
    %
    
    
    -2.1
    %NARPAB (3)
    
    $
    371
    
    
    $
    373
    
    
    $
    (2
    )Other income per avail. bed (4)
    
    $
    19
    
    
    $
    21
    
    
    $
    (2
    )RevPAB (5)
    
    $
    390
    
    
    $
    394
    
    
    $
    (4
    )Operating expense per bed (6) (7)
    
    $
    171
    
    
    $
    162
    
    
    $
    9Operating margin (7)
    
    
    56.1
    %
    
    
    58.9
    %
    
    
    -2.8
    %Design Beds (8)
    
    
    67,501
    
    
    
    55,713
    
    
    
    11,788
 25




---



##### Table of Contents



(1)
    
    Physical occupancy represents a weighted average of the month-end occupancies for the respective period.(2)
    
    Economic occupancy represents the effective occupancy calculated by taking net apartment rent accounted
for on a GAAP basis for the respective period divided by potential rent for the respective period.(3)
    
    NARPAB represents GAAP net apartment rent for the respective period divided by the sum of the design beds
in the portfolio for each of the included months. Does not include food service revenue or other leasing
revenue.(4)
    
    Represents GAAP-based other income for the respective period divided by the sum of the design beds in the
portfolio for each of the included months. Other income includes service/application fees, late fees,
termination fees, parking fees, transfer fees, damage recovery, utility recovery and other miscellaneous
income.(5)
    
    RevPAB represents total revenue (net apartment rent plus other income) for the respective period divided
by the sum of the design beds for each of the included months.(6)
    
    Represents property-level operating expenses excluding management fees and depreciation and amortization
divided by the sum of the design beds for each of the included months.(7)
    
    For the three months ended March 31, 2008, approximately $8 per bed related to the loss on the sale of
land and the parking garage at University Towers (see Note 8 in the condensed consolidated financial
statements) is excluded. The loss of $512 is included in the statement of operations in the condensed
consolidated financial statements.(8)
    
    Represents the sum of the monthly design beds in the portfolio during the period. As of February 1, 2008,
the design beds related to the Place Portfolio were included in the total for the three months ended March
31, 2008 due to the termination of the lease with Place Properties (see Note 2 in the condensed
consolidated financial statements).(9)
    
    This information excludes property information related to Tharpe (discontinued operations) for all periods.
    26




---



##### Table of Contents



Third-party development consulting services
  Recognized EarningsProject
    
    Beds
    
    Fee Type
    
    2008
    
    2007
    
    DifferenceSlippery Rock University 
Phase I
    
    
    1,390
    
    
    Development fee
    
    $
    
    
    
    $
    37
    
    
    $
    (37
    )Indiana University of
Pennsylvania
    
    
    734
    
    
    Development fee
    
    
    
    
    
    
    438
    
    
    
    (438
    )University of Michigan
    
    
    896
    
    
    Development fee
    
    
    100
    
    
    
    80
    
    
    
    20University of North Carolina
 Greensboro
    
    
    600
    
    
    Construction oversight fee
    
    
    
    
    
    
    33
    
    
    
    (33
    )University of Alabama 
Tuscaloosa
    
    
    631
    
    
    Development fee
    
    
    670
    
    
    
    435
    
    
    
    235Slippery Rock University 
Phase II
    
    
    746
    
    
    Development fee
    
    
    161
    
    
    
    20
    
    
    
    141Indiana University of
Pennsylvania  Phase II
    
    
    1,102
    
    
    Development fee
    
    
    648
    
    
    
    
    
    
    
    648Fontainebleu Renovation Project
    
    
    435
    
    
    Development fee
    
    
    13
    
    
    
    
    
    
    
    13West Chester
    
    
    1,197
    
    
    Development fee
    
    
    195
    
    
    
    
    
    
    
    195Third-party development
consulting services
    
    
    
    
    
    
    
    
    
    $
    1,787
    
    
    $
    1,043
    
    
    $
    744California University of
Pennsylvania  Phase V
    
    
    356
    
    
    Development fee
    
    
    (1
    )
    
    
    63
    
    
    
    (64
    )University of North Carolina
 Greensboro
    
    
    600
    
    
    Development fee
    
    
    
    
    
    
    77
    
    
    
    (77
    )Equity in earnings of
unconsolidated entities
    
    
    
    
    
    
    
    
    
    $
    (1
    )
    
    $
    140
    
    
    $
    (141
    )
    27




---



##### Table of Contents



Management services
   Unallocated corporate expenses
  Funds from Operations (FFO)
    28




---



##### Table of Contents



Three Months EndedMarch 31,2008
    
    
    2007Net income (loss)
    
    $
    889
    
    
    $
    (491
    )Plus loss on sale of student housing assets
    
    
    512Plus student housing property depreciation
and amortization of lease intangibles
    
    
    7,451
    
    
    
    7,998Plus equity portion of real estate
depreciation and amortization on equity
investees
    
    
    125
    
    
    
    98Plus depreciation and amortization of
discontinued operations
    
    
    
    
    
    
    469Plus minority interest
    
    
    97
    
    
    
    136Funds from operations
    
    $
    9,074
    
    
    $
    8,210
 Liquidity and Capital Resources
 Revolving credit facility and other indebtedness
     Liquidity outlook and capital requirements
  29




---



##### Table of Contents



Predevelopment expenditures
   Long-term liquidity requirements
  30




---



##### Table of Contents



Commitments and Contractual obligations
  Less than
    
    
    1-3
    
    
    3-5
    
    
    After 51 Year
    
    
    Years
    
    
    Years
    
    
    Years
    
    
    TotalCommitments and Contractual
Obligations:Long-Term Debt Obligations(1)
    
    $
    2,536
    
    
    $
    285,937
    
    
    $
    66,262
    
    
    $
    40,587
    
    
    $
    395,322Contractual Interest Obligations(2)
    
    
    17,616
    
    
    
    23,999
    
    
    
    9,749
    
    
    
    2,942
    
    
    
    54,306Operating Lease and Future
Purchase Obligations (3)
    
    
    2,418
    
    
    
    4,416
    
    
    
    2,594
    
    
    
    485
    
    
    
    9,913Capital Reserve Obligations(4)
    
    
    1,404
    
    
    
    2,395
    
    
    
    421
    
    
    
    182
    
    
    
    4,402Total
    
    $
    23,974
    
    
    $
    316,747
    
    
    $
    79,026
    
    
    $
    44,196
    
    
    $
    463,943
 
 (1)
    
    Includes required monthly principal amortization and amounts due at maturity on first mortgage debt secured by student
housing properties. The first mortgage debt does not include $1,513 of unamortized debt premium.(2)
    
    Includes contractual interest payments.(3)
    
    Includes future minimum lease commitments under operating lease obligations and future purchase obligations for advertising.(4)
    
    Includes future annual contributions to the capital reserve as required by certain mortgage debt.    Distributions
  31




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##### Table of Contents



Off-Balance Sheet Arrangements
  Inflation
  
 Item 3. Quantitative and Qualitative Disclosures about Market Risk.
      
 Item 4. Controls and Procedures.
 Managements Evaluation of Disclosure Controls and Procedures
  32




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##### Table of Contents



Changes in Internal Control Over Financial Reporting
  33




---



##### Table of Contents



PART II
 OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk factors
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults upon Senior Securities.
  
 Item 4. Submission of Matters to a Vote of Security Holders.
  
 Item 5. Other Information.
  
 Item 6. Exhibits.
  34




---



##### Table of Contents



SIGNATURES
  EDUCATION REALTY TRUST, INC.Date: May 2, 2008
    By
    /s/ Paul O. BowerPaul O. BowerPresident, Chief Executive Officer and
Chairman of the Board of Directors
(Principal Executive Officer)Date: May 2, 2008
    By
    /s/ Randall H. BrownRandall H. BrownExecutive Vice President, Chief Financial
Officer, Treasurer and Secretary
(Principal Financial Officer)Date: May 2, 2008
    By
    /s/ J. Drew KoesterJ. Drew KoesterVice President and Chief Accounting Officer
(Principal Accounting Officer) 35




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##### Table of Contents



EXHIBIT INDEX
 3.1
    
    Second Articles of Amendment and Restatement of Education Realty
Trust, Inc. (Incorporated by reference to Exhibit 3.1 to the
Trusts Amendment No. 2 to its Registration Statement on Form S-11
(File No. 333-1192364), filed on December 10, 2004.)3.2
    
    Bylaws of Education Realty Trust, Inc. (Incorporated by reference
to Exhibit 3.2 to the Trusts Registration Statement on Form S-11
(File No. 333-119264), filed on September 24, 2004.)4.1
    
    Form of Certificate for Common Stock of Education Realty Trust,
Inc. (Incorporated by reference to Exhibit 4.1 to the Trusts
Amendment No. 5 to its Registration Statement on Form S-11 (File
No. 333-1192364), filed on January 24, 2005.)4.2
    
    Form of Registration Rights Agreement dated January 31, 2005, by
and among Education Realty Trust, Inc., Education Realty Operating
Partnership, LP, JPI Investment Company, L.P. and the unit holders
whose names are set forth on the signature pages thereto.
(Incorporated by reference to Exhibit 4.3 to the Trusts
Registration Statement on Form S-11 (File No. 333-119264), filed on
September 24, 2004.)10.1**
    
    Executive Employment Agreement with Thomas Trubiana effective
January 1, 2008 (Incorporated by reference to Exhibit 10.1 to the
Trusts Current Report of Form 8-K filed on January 7, 2008.)10.2**
    
    Executive Employment Agreement with Randall H. Brown effective
January 1, 2008 (Incorporated by reference to Exhibit 10.2 to the
Trusts Current Report of Form 8-K filed on January 7, 2008.)10.3**
    
    Executive Employment Agreement with Paul O. Bower effective January
1, 2008 (Incorporated by reference to Exhibit 10.3 to the Trusts
Current Report of Form 8-K filed on January 7, 2008.)10.4**
    
    Executive Employment Agreement with Thomas J. Hickey effective
January 1, 2008 (Incorporated by reference to Exhibit 10.4 to the
Trusts Current Report of Form 8-K filed on January 7, 2008.)10.5**
    
    Executive Employment Agreement with Craig L. Cardwell effective
January 1, 2008 (Incorporated by reference to Exhibit 10.5 to the
Trusts Current Report of Form 8-K filed on January 7, 2008.)10.6**
    
    Executive Employment Agreement with William W. Harris effective
January 1, 2008 (Incorporated by reference to Exhibit 10.6 to the
Trusts Current Report of Form 8-K filed on January 7, 2008.)31.1
    
    Certification of Chief Executive Officer pursuant to Rule 13a-14(a)
of the Securities Exchange Act, as amended.31.2
    
    Certification of Chief Financial Officer pursuant to Rule 13a-14(a)
of the Securities Exchange Act, as amended.32.1*
    
    Section 906 Certification of Chief Executive Officer32.2*
    
    Section 906 Certification of Chief Financial Officer
 36




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##### Table of Contents



*
    
    In accordance with Release No. 34-47986, this Exhibit is hereby
furnished to the SEC as an accompanying document and is not deemed
filed for purposes of Section 18 of the Securities Exchange Act of
1934 or otherwise subject to the liabilities of that Section, nor
shall it be deemed incorporated by reference into any filing under the
Securities Act of 1933.**
    
    These exhibits are management contracts or compensatory plans. 37