BIRMINGHAM, AL-Encouraged by improving fundamentals in themultifamily sector, Colonial Properties Trust is primed to begindevelopment of apartment projects for a late 2011 or 2012 delivery.The REIT’s Chairman and CEO Thomas Lowder made the annoucementduring the company’s first quarter earnings conference call.

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“Should multifamily fundamentals continue to improve in marketswhere we have sites ready for development, we would be more likelyto start selective multifamily development that we had previouslypostponed so we can deliver units in late 2011 or 2012 where weexpect significant rent growth,” Lowder said.

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During the first quarter, occupancy for Colonial Properties’apartment portfolio increased 200 basis points to 96.7%. “Earlysigns of recovery are broad-based,” according to C. ReynoldsThompson III, president and CFO of Colonial Properties. In fact,the REIT saw occupancy improve in 11 out of 12 markets, and netrental income has trended positive for three months in a row, henotes.

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In total, Colonial Properties has an apartment developmentpipeline totaling $74.6 million, according to its quarterlysupplemental filings. During the first quarter, the REIT invested$25 million to $30 million in new development activity.

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“We share the optimism of many in our industry and are pleasedto see multifamily fundamentals stabilize earlier than originallyanticipated,” Lowder said.

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In addition to Colonial Properties’ multifamily developmentactivity, the REIT is moving forward with Colonial Promenade Norddu Lac Phase I, a 261,000 square-foot retail development located inCovington, LA. Originally, the retail center was slated to be alifestyle center, but the REIT postponed the project to transformit into a power center, Thompson said during the call.

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The REIT broke ground on Colonial Promenade Nord du Lac Phase Iduring the first quarter. It will be will be anchored by Kohl's,Academy Sports + Outdoors and Hobby Lobby. Phase I, which has atotal development cost of $27.1 million, is scheduled to open inOctober 2010.

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