"Positive revenue and net operating income growth in the first quarter of 2009 place Home Properties among the highest performers in the apartment REIT sector in a very challenging economic environment," said Edward J. Pettinella, Home Properties President and CEO. "Our lower price point apartments and strong geographic footprint position us well to outperform the sector as we did in the period from 2001 to 2004 during the last recession."

Earnings per share ("EPS") for the quarter ended March 31, 2009 was $0.33, compared to $0.79 for the quarter ended March 31, 2008. The $0.46 decrease in EPS is primarily attributable to a $16.3 million decrease in gain on disposition of property combined with a $3.6 million increase in loss from discontinued operations. Three properties were sold in the first quarter of 2009 for a gain of $13.5 million. The sale of seven properties in the first quarter of 2008 produced a gain of $29.8 million.

For the quarter ended March 31, 2009, Funds From Operations ("FFO") was $35.9 million, or $0.79 per share, compared to $35.8 million, or $0.78 per share, for the quarter ended March 31, 2008. First quarter 2009 FFO of $0.79 per share was at the midpoint of the guidance range provided by management and exceeded analysts' mean estimate, as reported by Thomson, by $0.01 and equates to a 2.0% increase from the prior year. A reconciliation of GAAP net income to FFO is included in the financial data accompanying this news release.

The EPS and FFO earnings discussed above include the amortization of the debt discount which is included in interest expense for both years in accordance with FSP APB 14-1, Convertible Debt Instruments, which became effective January 1, 2009 and requires retrospective application.

First Quarter Operating Results

For the first quarter of 2009, same-property comparisons (for 104 "Core" properties containing 35,360 apartment units owned since January 1, 2008) reflected an increase in total revenues of 1.6% compared to the same quarter a year ago. Net operating income ("NOI") increased by 0.8% from the first quarter of 2008. Property level operating expenses increased by 2.6% for the quarter primarily due to increases in natural gas heating costs, personnel, real estate taxes and snow removal costs, which were partially offset by a reduction in insurance and property management general and administrative costs.

Average physical occupancy for the Core properties was 94.4% during the first quarter of 2009, compared to 94.9% during the first quarter of 2008. Average monthly rental rates, including utility recoveries, increased 2.4% compared to the year-ago period.

On a sequential basis, compared to the 2008 fourth quarter results for the Core properties, total revenues were up 0.2% in the first quarter of 2009, expenses were up 2.1%, and net operating income was down 1.3%. Average physical occupancy decreased 0.5% to 94.4%, and average monthly rental rates including utility recoveries were 1.1% higher. The sequential expense growth can be attributed to the typical seasonality of higher natural gas heating and snow removal costs incurred in the first quarter.

Occupancies for the 1,029 net apartment units acquired/developed between January 1, 2008 and March 31, 2009 (the "Recently Acquired Communities") averaged 90.9% during the first quarter of 2009, at average monthly rents of $1,170.

Acquisitions/Dispositions

There were no acquisitions during the first quarter of 2009, and there are currently no plans to acquire properties for the remainder of the year.

During the first quarter of 2009, as previously reported, the Company sold three properties for $68 million, producing approximately $25 million in net proceeds after mortgage payoffs and closing costs. A gain on sale of approximately $13.5 million was recorded in the first quarter of 2009 related to this sale.

Capital Markets Activities

As of March 31, 2009, the Company's ratio of debt-to-total market capitalization was 62.2% (based on a 3/31/2009 stock price of $30.65 to determine equity value), with $75.5 million outstanding on its $140 million revolving credit facility and $8.3 million of unrestricted cash on hand. Total debt of $2.3 billion was outstanding, at rates of interest averaging 5.5% and with staggered maturities averaging approximately six years. Approximately 94.2% of total indebtedness is at fixed rates. Interest coverage averaged 2.2 times during the quarter, and the fixed charge ratio averaged 2.1 times for the quarter.

The Company did not repurchase any of its common shares during the first quarter. As of March 31, 2009, the Company has Board authorization to buy back up to approximately 2.3 million additional shares of its common stock or Operating Partnership Units, although it has no current plans to do so.

Outlook

For 2009, the Company has reconfirmed the $3.16 midpoint of its guidance while tightening the range to $3.07 to $3.25 per share from $3.04 and $3.28. The new range will produce FFO per share growth of -11.1% to -5.9% when compared to 2008 results as restated for FSP APB 14-1. This guidance range reflects management's current assessment of economic and market conditions.

The quarterly breakdown for the 2009 guidance on FFO per share results is unchanged and is as follows: Second quarter $0.77 to $0.83; third quarter $0.76 to $0.82; fourth quarter $0.75 to $0.81.

Dividend Declared

On May 5, 2009, Home Properties declared a regular cash dividend on the Company's common shares of $0.67 per share for the quarter ended March 31, 2009. The cash dividend is payable on May 27, 2009 to shareholders of record on May 15, 2009 and is equivalent to an annualized rate of $2.68 per share. The current annual dividend represents a 6.9 percent yield based on Monday's closing price of $38.82. Home Properties' common stock will begin trading ex-dividend on May 13, 2009.

Supplemental Information

The Company produces supplemental information that provides details regarding property operations, other income, acquisitions, sales, market geographic breakdown, debt and new development. The supplemental information is available via the Company's Web site through the "Investor" section, e-mail or facsimile upon request.

First Quarter 2009 Earnings Conference Call

The Company will conduct a conference call and simultaneous webcast tomorrow at 11:00 AM Eastern Time to review and comment on the information reported in this release. To listen to the call, please dial 800-954-0647 (International 212-231-2901). An audio replay of the call will be available through May 13, 2009, by dialing 800-633-8284 or 402-977-9140 and entering the passcode 21412429.