Cornerstone Reports Tax Treatment of 2004 Distributions.

RICHMOND, Va. -- Cornerstone Realty Income Trust, Inc. today reported the tax treatment of 2004 dividend distributions on its common shares (NYSE:TCR) and on its Series A convertible preferred shares (NYSE:TCRPR).

The tax treatment for both securities is as follows:

Common Stock
CUSIP                                   21922V102
Distributions Per Share                 $0.80
Taxable Ordinary Income                 13.54%
Return of Capital                       76.38%
Qualified Dividend Income                0.48%
Long-Term Capital Gain                   1.73%
Unrecaptured Section 1250 Gain           7.87%

Series A Convertible Preferred Stock
CUSIP                                   21922V201
Distributions Per Share                 $2.3042
Taxable Ordinary Income                 57.33%
Qualified Dividend Income                2.02%
Long-Term Capital Gain                   7.34%
Unrecaptured Section 1250 Gain          33.31%

Common share distributions taxable in 2004 were paid in January 2004, April 2004, July 2004 and October 2004. Series A convertible preferred share distributions taxable in 2004 were paid in April 2004, July 2004, October 2004 and December 2004. Cornerstone redeemed for cash all of its outstanding Series A convertible preferred shares on December 21, 2004.

Company Profile

Cornerstone Realty Income Trust, Inc. (NYSE:TCR) is a fully integrated, self-managed and self-advised real estate company that has operated as a real estate investment trust (REIT) since 1993. The company focuses on the ownership and management of multifamily communities in select markets in Virginia, North Carolina, South Carolina, Georgia and Texas. Currently Cornerstone owns 87 apartment communities with 22,910 units, a third-party property management business, apartment land under development, and ownership interests in four real estate joint ventures. Cornerstone is headquartered in Richmond, Virginia and its common stock trades on the New York Stock Exchange under the symbol "TCR." For more information, visit the company's web site at www.cornerstonereit.com.