Archstone-Smith Announces Record
Earnings Per Share for 2005
Same-store Portfolio Produces Seventh Consecutive
Quarter of Improving Growth

DENVER — February 2, 2006 — Archstone-Smith (NYSE:ASN) announced record net earnings per share (EPS) of $3.00 for the year ended December 31, 2005 – an 11.5% increase compared with the $2.69 per share reported for 2004. EPS for the fourth quarter of 2005 was $1.52 per share, compared with $1.11 per share for the same period in 2004. Funds from operations (FFO) with gains/losses, which reflects the positive impact of Archstone-Smith's investment strategy, for the full year of 2005 was $3.40 per share, compared with $3.26 per share in 2004. FFO with gains/losses was $1.39 per share in the fourth quarter of 2005, compared with $1.22 per share for the fourth quarter of 2004. The company's FFO for the year ending December 31, 2005 was $2.10 per share, compared with the $1.98 reported for 2004. FFO for the fourth quarter was $0.52 per share, compared with $0.40 per share for the same period in 2004.

In addition, Archstone-Smith announced its guidance for the coming year. The company's 2006 EPS guidance is $2.60 to $3.00 per share and its 2006 FFO guidance is $2.11 to $2.21 per share. Archstone-Smith's 2005 FFO per share of $2.10 included non-recurring items attributable to the net impact of Rent.com and other stock sales gains, insurance recoveries, hurricane damage, pre-payment penalties and a note receivable write-off. Adjusting for these items, the mid-point of the company's 2006 FFO guidance represents an increase of 8.5% above normalized 2005 FFO.

Same-store Operating Performance Accelerates Dramatically Quarter-Over-Quarter

"The accelerating improvement in our same store results is very exciting, and sets the stage for very positive performance from our portfolio in 2006," said R. Scot Sellers, chairman and chief executive officer. "Our emphasis on operational excellence and innovation, combined with our unique portfolio, provides a very strong foundation for continued increases in long term value for our shareholders."

Archstone-Smith's same-store revenues increased 5.5% in the fourth quarter of 2005, representing the seventh consecutive quarter of increasing revenue growth. Archstone-Smith's same-store net operating income (NOI) grew 6.4% in the fourth quarter – the highest quarterly NOI growth since the company's acquisition of Charles E. Smith Residential in the fourth quarter of 2001. "Solid employment growth, combined with the extremely expensive housing prices in our core markets, has provided us with excellent pricing power," said Mr. Sellers. "Apartment fundamentals are as good as we've seen in several years."

Strategic Acquisitions, Capital Redeployment Strategy and Developments Position Company for Strong Growth

Overall transaction volume in 2005, including acquisitions, dispositions and development starts for Archstone-Smith and Ameriton, totaled approximately $5.0 billion. "Each and every one of these transactions was aimed at creating significant incremental value for our shareholders, and even further improving what we believe is already the best apartment portfolio in the United States," said Mr. Sellers. In 2005, Archstone-Smith acquired $2.5 billion of apartment communities in U.S. markets that include Manhattan, the San Francisco Bay area and Southern California, including the purchase of a $1.6 billion portfolio from Oakwood Worldwide. In addition, the company completed its first acquisition in Europe in the fourth quarter of 2005, with the purchase of an 11-building, 822-unit portfolio concentrated in Mannheim, Germany, for $44.5 million (€37.6 million). "We are excited about our recent European acquisition, because it will allow us to better research and understand the apartment market in Germany in a much more fundamental way," said Mr. Sellers.

During the year, Archstone-Smith completed the sale of $1.1 billion of apartment communities and is now in the final stages of the capital redeployment program it began in 1995, through which the company expects to dispose of virtually all of its non-core assets by the end of 2006. The cash gains related to the company's 2005 dispositions exceeded $302 million, which is a profit of approximately 39% on the company's cost basis, and generated a pre-tax unleveraged internal rate of return (IRR) of 14.2%.

"Assets we owned in 1995 represent less than 2% of our portfolio today," said Charles E. Mueller, Jr., chief financial officer. "Our emphasis on protected locations, together with the strong operating platform we've developed, have enabled us to produce industry-leading same store operating results during the past five years. In addition, our $2.8 billion development pipeline provides a tremendous opportunity to create significant incremental value as we complete and stabilize these assets in the coming years." This pipeline represents the total expected investment of all Archstone-Smith and Ameriton wholly owned and joint venture developments under construction and in planning.

At the end of 2005, Archstone-Smith had $1.3 billion of communities under construction, in markets that include Manhattan, downtown Boston, Cambridge, Mass., Southern California and downtown Washington, D.C. Archstone-Smith expects to deliver first units – representing a total of 1,525 units upon completion – to operations in the first quarter of 2006 from development communities in markets that include Los Angeles; Pasadena, Calif.; downtown Washington, D.C.; and San Diego.

Ameriton Produced Strong Results and Excellent Returns in 2005

Archstone-Smith's fourth quarter 2005 results include gains from the sale of operating communities by Ameriton, the company's wholly owned subsidiary, which contributed $12.7 million, or $0.051 per share, to Archstone-Smith's fourth quarter EPS and $11.6 million, or $0.047 per share, to its fourth quarter FFO. For the year ended December 31, 2005, Ameriton sold 11 communities, contributing $62.5 million to Archstone-Smith's earnings in 2005, and $56.7 million, or $0.244 per share, to its 2005 FFO. Since 2000, Ameriton has completed the sale of $1.4 billion of apartment communities, contributing $0.77 per share to Archstone-Smith's FFO and generating a pre-tax unleveraged IRR of 24%.

Archstone-Smith's fourth quarter 2005 results included the following unexpected items that were not included in the previously issued guidance, representing a $0.047 per-share reduction in earnings and FFO: (i) hurricane damage costs of $4.2 million, net of anticipated recoveries; (ii) a $2.8 million write-off of a loan to a prior affiliate, which the company remains committed to collecting; (iii) a $1.5 million impairment related to a non-core asset that is expected to be sold in 2006; and (iv) a $3.2 million share award for the one-year special incentive plan for senior executives that ended on December 31, 2005; the grants were earned due to Archstone-Smith's share price performance during 2005.

In addition, Archstone-Smith's fourth quarter 2005 results included the following items that were anticipated and included in its previously issued guidance: (i) a positive impact of $8.3 million, or $0.034 per share of earnings and FFO, resulting from insurance recoveries associated with moisture infiltration and mold litigation; and (ii) a $1.7 million incentive payment earned in connection with the final liquidation of a joint venture partnership.

The company also has successfully negotiated an $8.8 million insurance settlement related to moisture infiltration and mold litigation at another community in Southeast Florida. Of this amount, $6.9 million, or $0.028 per share, is expected to be included in other income in the first quarter of 2006. This amount is reflected in the company's 2006 guidance.

The company also recorded a $47.2 million accrual in the fourth quarter for remediation work related to the previously disclosed Fair Housing Act (FHA) and Americans with Disabilities Act (ADA) lawsuit, which was settled in the second quarter of 2005. Archstone-Smith continues to seek recovery of a substantial portion of the expenses and capital expenditures related to this settlement from the architects, engineers and builders upon whom the company relied for assurances of building design and construction compliance. The company is, and has always been, fully committed to upholding the goals and objectives of the FHA and ADA. Because these costs relate to capital improvements, the accrual is capitalized and therefore had no impact on 2005 results.

Archstone-Smith (NYSE: ASN), an S&P 500 company, is a recognized leader in apartment investment and operations. With a current total market capitalization of $17.1 billion, the company's portfolio is concentrated in many of the most desirable neighborhoods in the Washington, D.C. metropolitan area, Southern California, the San Francisco Bay Area, the New York City metropolitan area, Boston, Southeast Florida, Chicago, and Seattle.  The company continually upgrades the quality of its portfolio through the selective sale of assets, using proceeds to fund investments in assets with even better growth prospects. Through its two brands, Archstone and Charles E. Smith, Archstone-Smith strives to provide great apartments and great service to its customers – backed by unconditional service guarantees. As of December 31, 2005, Archstone-Smith owned or had an ownership position in 257 communities, representing 86,930 units, including units under construction.

For full financials, click here.

Archstone-Smith's year-end 2005 full financials and archived press releases are available on its web site at www.ArchstoneSmith.com or may be obtained by calling (800) 982-9293.

In addition to historical information, this press release and quarterly supplemental information contain forward-looking statements and information under the federal securities law. These statements are based on current expectations, estimates and projections about the industry and markets in which Archstone-Smith operates, management's beliefs and assumptions made by management. While Archstone-Smith management believes the assumptions underlying its forward-looking statements and information are reasonable, such information is necessarily subject to uncertainties and may involve certain risks, many of which are difficult to predict and are beyond management's control. As such, these statements and information are not guarantees of future performance, and actual operating results may differ materially from what is expressed or forecasted in this press release and supplemental information. See "Risk Factors" in Archstone-Smith's 2004 Annual Report on Form 10-K for factors which could affect Archstone-Smith's future financial performance.