AvalonBay Communities, Inc. Celebrates 10th Anniversary.

Business Editors/Real Estate Writers

ALEXANDRIA, Va.--(BUSINESS WIRE)--Feb. 5, 2004

AvalonBay Communities, Inc. (NYSE/PCX:AVB) celebrated the 10-year anniversary of the Company's Initial Public Offering ("IPO") on the New York Stock Exchange ("NYSE") earlier this week. The Company's executive management team joined Chairman, President and CEO, Bryce Blair, as he rang The Closing Bell (TM) on Tuesday, February 3, 2004 at the NYSE.

AvalonBay Communities, Inc. was formed in 1998 from the merger of Avalon Properties and Bay Apartment Communities, each of which completed their IPO in 1993 and 1994, respectively. At the time of their IPOs, the companies collectively owned 36 communities with approximately 10,000 apartment homes and had a total market capitalization of less than $1 billion. Today AvalonBay owns over 140 apartment communities with approximately 42,000 apartment homes and has a Total Market Capitalization, in the aggregate, of almost $6 billion.

Through its development, investment and operating expertise, the Company has assembled a diverse portfolio of quality multifamily communities in premier supply-constrained markets. The Company's commitment to its strategy and focus on continuous improvement has led to a history of financial success and outsized value creation for shareholders. During the period December 31, 1994 to December 31, 2003 investors have enjoyed an annual Total Shareholder Return of 16.6% as compared to returns for the RMS, S&P 500 and NASDAQ of 12.7%, 12.2% and 11.9%, respectively. Shareholders have also received consistent dividend payments that have been fully covered by recurring cash flow and have grown at a compound annual growth rate of 7.7%. In addition, the Company has achieved a compound annual growth rate in Funds From Operations per share that exceeds the multifamily sector average by over 300 bps and has achieved a compound annual growth rate in Estimated Net Asset Value Per Share of 8.1%.

The Company is proud of its track record and attributes its success to strong execution by a management team with over 20 years experience in the industry and the dedicated support of AvalonBay's 1,700 associates. Over the past 10 years, REITs have emerged as mainstream investments, a part of the S&P 500 and are recognized as an important part of investors' need to diversify to obtain the highest possible risk-adjusted returns. AvalonBay's industry experience and knowledge combined with its well-located, quality portfolio position the company for future growth.

About AvalonBay Communities, Inc.

AvalonBay Communities, Inc., headquartered in Alexandria, Virginia, currently owns or holds an ownership interest in 142 apartment communities containing 41,997 apartment homes in ten states and the District of Columbia, of which eleven communities are under construction and two communities are under reconstruction. AvalonBay is in the business of developing, redeveloping, acquiring and managing apartment communities in high barrier-to-entry markets of the United States. More information on AvalonBay may be found on AvalonBay's Web Site at http://www.avalonbay.com.

Definitions and Reconciliations of Non-GAAP Financial Measures and Other Terms

This release contains certain non-GAAP financial measures and other terms. The definition and calculation of these non-GAAP financial measures and other terms may differ from the definitions and methodologies used by other REITs and, accordingly, may not be comparable. The non-GAAP financial measures referred to below should not be considered an alternative to net income as an indication of our performance. In addition, these non-GAAP financial measures do not represent cash generated from operating activities in accordance with GAAP and therefore should not be considered as an alternative measure of liquidity or as indicative of cash available to fund cash needs. All financial measures are presented for the period December 31, 1994 to December 31, 2003.

Total Market Capitalization represents the aggregate of the market value of the Company's common stock, the market value of the Company's operating partnership units outstanding (based on the market value of the Company's common stock), the liquidation preference of the Company's preferred stock and the outstanding principal balance of the Company's debt.

Total Shareholder Return represents the compound annual growth rate, including the reinvestment of dividends. Total shareholder return for any period within the timeframe indicated varies. Past performance is no guarantee of future results.

FFO is determined based on a definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts ("NAREIT"). FFO is calculated by the Company as net income or loss computed in accordance with GAAP, adjusted for gains or losses on sales of property, extraordinary gains or losses (as defined by GAAP) and depreciation of real estate assets, including adjustments for unconsolidated partnerships and joint ventures. Management generally considers FFO to be an appropriate supplemental measure of operating performance because, by excluding gains or losses related to dispositions of property and excluding real estate depreciation (which can vary among owners of identical assets in similar condition based on historical cost accounting and useful life estimates), FFO can help one compare the operating performance of a company's real estate between periods or as compared to different companies.

Estimated Net Asset Value (NAV Per Share) is the estimated market value of a Company's assets less all current and long-term liabilities divided by the number of outstanding common shares and operating partnership units. Growth in Estimated NAV Per Share is the compound annual growth rate of Estimated NAV Per Share for AvalonBay as estimated by Green Street Advisors, Inc. The calculation of Estimated NAV Per Share by others may not be comparable to the Green Street Advisors, Inc.'s calculation and estimates. Estimated NAV Per Share growth for any year within the timeframe indicated varies.

Copyright (C) 2004 AvalonBay Communities, Inc. All Rights Reserved