COUSINS PROPERTIES INCORPORATED
Table of Contents

 
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
Form 10-K
 
     
þ
  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934
    For the fiscal year ended December 31, 2006
or
o
  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934
    For the transition period from          to          
 
Commission file number 0-3576
 
COUSINS PROPERTIES INCORPORATED
(Exact name of registrant as specified in its charter)
 
     
Georgia
  58-0869052
(State or other jurisdiction   (I.R.S. Employer
of incorporation or organization)   Identification No.)
     
2500 Windy Ridge Parkway,
Suite 1600, Atlanta, Georgia
(Address of principal executive offices)
  30339-5683
(Zip Code)
(770) 955-2200
(Registrant’s telephone number, including area code)
 
Securities registered pursuant to Section 12(b) of the Act:
 
     
Title of Each Class
 
Name of Exchange on Which Registered
 
Common Stock ($1 par value)   New York Stock Exchange
7.75% Series A Cumulative Redeemable    
Preferred Stock ($1 par value)   New York Stock Exchange
7.50% Series B Cumulative Redeemable    
Preferred Stock ($1 par value)
  New York Stock Exchange
 
Securities registered pursuant to Section 12(g) of the Act:
None
 
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes þ     No o
 
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.  Yes o      No þ
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ     No o
 
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  o
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.
 
Large accelerated filer  þ      Accelerated filer  o      Non-accelerated filer  o
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes o No þ
 
As of June 30, 2006, the aggregate market value of the common stock of Cousins Properties Incorporated held by non-affiliates was $1,207,847,739 based on the closing sale price as reported on the New York Stock Exchange. As of February 23, 2007, 51,933,819 shares of common stock were outstanding.
 
DOCUMENTS INCORPORATED BY REFERENCE
 
Portions of the Registrant’s proxy statement for the annual stockholders meeting to be held on May 14, 2007 are incorporated by reference into Part III of this Form 10-K.
 


TABLE OF CONTENTS

PART I
Item 1. Business
Item 1A. Risk Factors
Item 1B. Unresolved Staff Comments
Item 2. Properties
Item 3. Legal Proceedings
Item 4. Submission of Matters to a Vote of Security Holders
Item X. Executive Officers of the Registrant
PART II
Item 5. Market for Registrant’s Common Stock and Related Stockholder Matters
Item 6. Selected Financial Data
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Item 7A. Quantitative and Qualitative Disclosure about Market Risk
Item 8. Financial Statements and Supplementary Data
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Item 9A. Controls and Procedures
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Item 9B. Other Information
PART III
Item 10. Directors and Executive Officers and Corporate Governance
Item 11. Executive Compensation
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Item 13. Certain Relationships and Related Transactions, and Director Independence
Item 14. Principal Accounting Fees and Services
PART IV
Item 15. Exhibits and Financial Statement Schedules
SIGNATURES
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
EX-12 STATEMENT REGARDING COMPUTATION OF EARNINGS TO COMBINED FIXED CHARGES
EX-21 SUBSIDIARIES OF THE REGISTRANT
EX-23 CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
EX-31.1 SECTION 302 CERTIFICATION OF CEO
EX-31.2 SECTION 302 CERTIFICATION OF CFO
EX-32.1 SECTION 906 CERTIFICATION OF CEO
EX-32.2 SECTION 906 CERTIFICATION OF CFO


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FORWARD-LOOKING STATEMENTS
 
Certain matters contained in this report are forward-looking statements within the meaning of the federal securities laws and are subject to uncertainties and risks. These include, but are not limited to, general and local economic conditions, local real estate conditions, the activity of others developing competitive projects, the risks associated with development projects (such as delay, cost overruns and leasing/sales risk of new properties), the cyclical nature of the real estate industry, the financial condition of existing tenants, interest rates, the Company’s ability to obtain favorable financing or zoning, environmental matters, the effects of terrorism, the ability of the Company to close properties under contract and other risks detailed from time to time in the Company’s filings with the Securities and Exchange Commission, including this report on Form 10-K. The words “believes,” “expects,” “anticipates,” “estimates” and similar expressions are intended to identify forward-looking statements. Although the Company believes that its plans, intentions and expectations reflected in any forward-looking statements are reasonable, the Company can give no assurance that such plans, intentions or expectations will be achieved. Such forward-looking statements are based on current expectations and speak as of the date of such statements. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of future events, new information or otherwise.


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PART I
 
Item 1.  Business
 
Corporate Profile
 
Cousins Properties Incorporated (the “Registrant” or “Cousins”) is a Georgia corporation, which since 1987 has elected to be taxed as a real estate investment trust (“REIT”). Cousins Real Estate Corporation and its subsidiaries (“CREC”) is a taxable entity wholly-owned by the Registrant and is consolidated with the Registrant. CREC owns, develops, and manages its own real estate portfolio and performs certain real estate related services for other parties. The Registrant and CREC combined are hereafter referred to as the “Company.” The Company has been a public company since 1962, and its common stock trades on the New York Stock Exchange under the symbol “CUZ.”
 
The Company’s strategy is to produce strong stockholder returns by creating value through the acquisition, development and redevelopment of high quality, well-located office, multi-family, retail, industrial, and residential properties. The Company has developed substantially all of the income producing real estate assets it owns and operates. A key element in the Company’s strategy is to actively manage its portfolio of investment properties and, at the appropriate times, to engage in timely and strategic dispositions either by sale or through contributions to ventures in which the Company retains an ownership interest. These transactions seek to maximize the value of the assets the Company has created, generate capital for additional development properties and return a portion of the value created to stockholders.
 
Unless otherwise indicated, the notes referenced in the discussion below are the “Notes to Consolidated Financial Statements” included in this Annual Report on Form 10-K on pages F-7 through F-43.
 
The Company conducts its business through four divisions: Office/Multi-Family, Retail, Industrial and Land. The following is a summary of the strategy and 2006 activity in each of its operating divisions:
 
Business Description and Significant Changes in 2006
 
Office/Multi-Family Division
 
The strategy of the Office/Multi-Family Division is to create value through (1) the development and asset management of Class A office projects with particular focus in Austin, Dallas, Charlotte, Birmingham, and Atlanta; (2) the development and sale of multi-family projects in urban locations in the Southeastern United States targeted to buyers with generally higher income and less sensitivity to interest rates; and (3) the management and leasing of office properties owned by third parties. In addition to traditional office/multi-family projects, the Office/Multi-Family Division is engaged in the development of mixed use projects that contain multiple product types in communities where individuals live, work and seek entertainment.
 
As of December 31, 2006, the Office/Multi-Family Division owned directly or through joint ventures 20 operating office properties totaling 4.9 million rentable square feet and had five office or multi-family projects under active development or redevelopment.
 
Significant activity within the Office/Multi-Family Division in 2006 was as follows:
 
  •  Formed a joint venture which is intended to construct Palisades West, a 360,000 square foot, two building office development in Austin, Texas.
 
  •  Increased percentage leased of Terminus 100 from 41% at December 31, 2005 to 64% at December 31, 2006.
 
  •  Completed the construction and closed the sale of all units at 905 Juniper, the Company’s first multi-family project.
 
  •  Acquired 191 Peachtree, a 1.2 million square foot, Class A building in Downtown Atlanta.
 
  •  Increased percentage of completion of 50 Biscayne from 26% at December 31, 2005 to 70% at December 31, 2006. The Company expects construction to be substantially complete and unit closings to commence in the fourth quarter of 2007.


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  •  Had significant leasing activity, notably a 274,000 square foot lease to the American Cancer Society at Inforum.
 
Retail Division
 
The strategy of the Retail Division is to create stockholder value through the development and management of retail shopping centers, including Avenue® concept lifestyle centers and power centers. The Retail Division focuses its efforts in demographically favorable markets in the Sunbelt with a particular emphasis on Georgia, Tennessee, North Carolina, Texas and Florida. In addition, the Retail Division is partnering with other divisions for mixed-use developments such as the Terminus project in the Buckhead district of Atlanta.
 
As of December 31, 2006, the Company owned directly or through joint ventures 10 operating retail properties totaling 2.7 million rentable square feet and had three projects and one expansion under active development totaling 1.5 million square feet.
 
Significant activity within the Retail Division in 2006 was as follows:
 
  •  Commenced operations of San Jose MarketCenter, a 363,000 square foot power center in San Jose, California, of which the Company owns 220,000 square feet.
 
  •  Commenced operations of The Avenue Webb Gin, a 381,000 square foot lifestyle center in suburban Atlanta.
 
  •  Through a joint venture, commenced construction of The Avenue Murfreesboro, an 810,000 square foot lifestyle center in suburban Nashville, Tennessee.
 
Industrial Division
 
The strategy of the Industrial Division is to create value through the development of institutional quality warehouse and distribution properties. The Industrial Division initially focused its efforts on the metropolitan Atlanta area. In 2006, it expanded into the Dallas market with a joint venture partner. Over time, the Industrial Division expects to expand beyond the Atlanta and Dallas market areas to port cities such as Savannah, Jacksonville and Tampa as well as major distribution centers that may include Central Florida, Memphis and Kansas City.
 
As of December 31, 2006, the Company owned through joint ventures one operating industrial property totaling 417,000 rentable square feet and three projects under active development totaling 1.6 million square feet.
 
Significant activity within the Industrial Division in 2006 was as follows:
 
  •  Commenced construction of the first building at Jefferson Mill Business Park, a 459,000 square foot industrial project in Jackson County, Georgia. This project will contain 3.2 million square feet upon completion.
 
  •  Through a joint venture commenced construction of the first building in Lakeside Ranch Business Park in Dallas, Texas. The first building will contain 749,000 square feet and the project will contain 1.7 million square feet upon completion.
 
  •  Commenced operations of the first building in King Mill Distribution Park containing 417,000 square feet.
 
  •  Commenced construction of the second building in King Mill Distribution Park containing 359,000 square feet.
 
Land Division
 
The strategy of the Land Division is to create value through the acquisition and entitlement of land, and the development and sale of residential lots. In addition, the Land Division acquires and sells certain undeveloped tracts of land to third parties that are generally adjacent to or a part of its residential lot developments. The Land Division conducts most of its business through partnerships with Temple Inland and its affiliates. This alliance has allowed the Company to share in the capital invested in individual projects and to share resources and expertise in the development and sale of residential lots and land tracts.


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As of December 31, 2006, the Company had 24 residential communities under development directly or through joint ventures in which approximately 11,600 lots remain to be developed and/or sold. In addition, the Company or its joint ventures had approximately 9,100 acres of undeveloped land.
 
Significant activity within the Land Division in 2006 was as follows:
 
  •  Commenced development of Blalock Lakes, a planned 3,000 acre residential community in Coweta County, Georgia that is expected to include private hunting, equestrian, fishing, swim and tennis facilities in a controlled access community.
 
  •  Entered into a joint venture with Callaway Gardens Resorts, Inc. for the development of residential lots within the Callaway Gardens Resort.
 
  •  Sold 1,576 residential lots, either directly or through joint ventures.
 
  •  Sold 1,245 acres of land tracts, either directly or through joint ventures.
 
Financing Activities
 
The Company’s financing strategy is to provide capital to fund its development activities while maintaining a relatively conservative debt level and managing the Company’s size to make the value created from its development activities more accretive to its common stockholders. Historically, the Company has accomplished this strategy by raising capital through bank lines of credit, construction and mortgage loans secured by its properties, sale of mature assets and distribution of the gains on asset sales to stockholders, contribution of assets into joint ventures, and the issuance of preferred stock.
 
During 2006, the Company had the following financing activities:
 
  •  Formed a venture with an institutional investor for the ownership, development, investment, management and leasing of certain commercial real estate projects, including five of the Company’s retail properties. This transaction provided $300 million in capital in 2006 and is expected to provide $20 million of capital in 2007 for future investment.
 
  •  Sold The Avenue of the Peninsula and its interests in Bank of America Plaza and Frost Bank Tower for total proceeds of $502 million.
 
  •  Sold seven ground lease outparcels at its North Point property generating proceeds of approximately $14.3 million.
 
  •  Recast its credit facility resulting in $75 million in additional capacity, a reduction in its interest spread over LIBOR and additional flexibility in certain financial covenants.
 
  •  Closed a $100 million unsecured construction facility for funding the development of Terminus 100.
 
  •  The joint venture developing The Avenue Murfreesboro closed a $131 million construction loan, of which the Company guarantees 20%.
 
  •  Paid a special dividend to common stockholders of $175.5 million or $3.40 per share.
 
Environmental Matters
 
Under various federal, state and local laws, ordinances and regulations, an owner or operator of real estate is generally liable for the costs of removal or remediation of certain hazardous or toxic substances on or in such property. Such laws often impose liability without regard to whether the owner knew of, or was responsible for, the presence of such hazardous or toxic substances. The presence of such substances, or the failure to properly remediate such substances, may subject the owner to substantial liability and may adversely affect the owner’s ability to develop the property or to borrow using such real estate as collateral. The Company is not aware of any environmental liability that the Company’s management believes would have a material adverse effect on the Company’s business, assets or results of operations.


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Certain environmental laws impose liability on a previous owner of property to the extent that hazardous or toxic substances were present during the prior ownership period. A transfer of the property does not relieve an owner of such liability. Thus, although the Company is not aware of any such situation, the Company may be liable in respect to properties previously sold.
 
In connection with the development or acquisition of certain properties, the Company has obtained Phase One environmental audits (which generally involve inspection without soil sampling or ground water analysis) from independent environmental consultants. The remaining properties (including the Company’s land held for investment or future development) have typically also been so examined. No assurance can be given that environmental liabilities do not exist, that the reports revealed all environmental liabilities or that no prior owner created any material environmental condition not known to the Company.
 
The Company believes that it and its properties are in compliance in all material respects with all federal, state and local laws, ordinances and regulations regarding hazardous or toxic substances.
 
Competition
 
The Company competes for tenants with similar properties located in its markets primarily on the basis of location, rental rates, services provided and the design and condition of the facilities. The Company also competes with other real estate companies, financial institutions, pension funds, partnerships, individual investors and others when attempting to acquire and develop properties. In addition, the Land and Office/Multi-Family divisions compete with other lot and multi-family developers.
 
Executive Offices; Employees
 
The Registrant’s executive offices are located at 2500 Windy Ridge Parkway, Suite 1600, Atlanta, Georgia 30339-5683. Effective April 1, 2007, the Company’s executive offices will relocate to 191 Peachtree Street, Suite 3600, Atlanta, Georgia 30303-1740. At December 31, 2006, the Company employed 488 people.
 
Available Information
 
The Company makes available free of charge on the “Investor Relations” page of its Web site, www.cousinsproperties.com, its filed and furnished reports on Forms 10-K, 10-Q and 8-K, and all amendments thereto, as soon as reasonably practicable after the reports are filed with or furnished to the Securities and Exchange Commission (the “SEC”).
 
The Company’s Corporate Governance Guidelines, Director Independence Standards, Code of Business Conduct and Ethics, and the Charters of the Audit Committee and the Compensation, Succession, Nominating and Governance Committee of the Board of Directors are also available on the “Investor Relations” page of the Company’s Web site. The information contained on the Company’s Web site is not incorporated herein by reference.
 
Copies of these documents (without exhibits, when applicable) are also available free of charge upon request to the Company at 2500 Windy Ridge Parkway, Suite 1600, Atlanta, Georgia 30339-5683, Attention: Investor Relations. Investor Relations may also be reached by telephone at (770) 955-2200 or by facsimile at (770) 857-2368. Effective April 1, 2007, the Company’s headquarters will relocate to 191 Peachtree Street, Suite 3600, Atlanta, Georgia 30303-1740, main telephone number (404) 407-1000.
 
In addition, the SEC maintains an internet website that contains reports, proxy and information statements, and other information regarding issuers, including the Company, that file electronically with the SEC at www.sec.gov.
 
Item 1A.   Risk Factors
 
Set forth below are the risks we believe investors should consider carefully in evaluating an investment in the securities of Cousins Properties Incorporated.


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General Real Estate Operating Risks
 
Our ownership of commercial real estate involves a number of risks, including general economic and market risks, leasing risk, uninsured losses and condemnation costs, environmental issues, joint venture structure risk and concentration of real estate, the effects of which could adversely affect our business.
 
General economic and market risks.  Our assets may not generate income sufficient to pay our expenses, service debt or maintain our properties, and, as a result, our results of operations may be adversely affected and we may need to reduce our dividend in future periods. Several factors may adversely affect the economic performance and value of our properties. These factors include, among other things:
 
  •  changes in the national, regional and local economic climate;
 
  •  local conditions such as an oversupply of properties or a reduction in demand for properties;
 
  •  the attractiveness of our properties to tenants;
 
  •  competition from other available properties;
 
  •  changes in market rental rates; and
 
  •  the need to periodically repair, renovate and re-lease space.
 
Our performance also depends on our ability to collect rent from tenants and to pay for adequate maintenance, insurance and other operating costs (including real estate taxes), which could increase over time. Also, the expenses of owning and operating a property are not necessarily reduced when circumstances such as market factors and competition cause a reduction in income from the property. If a property is mortgaged and we are unable to meet the mortgage payments, the lender could foreclose on the mortgage and take title to the property. In addition, interest rate levels, the availability of financing, changes in laws and governmental regulations (including those governing usage, zoning and taxes) and financial distress or bankruptcies of tenants may adversely affect our financial condition.
 
Leasing risk.  Our operating revenues are dependent upon entering into leases with and collecting rents from tenants. National, regional and local economic conditions may adversely impact tenants and potential tenants in the various marketplaces in which projects are located, and accordingly, could affect their ability to continue to pay rents and possibly to occupy their space. Tenants sometimes experience bankruptcies and pursuant to the various bankruptcy laws, leases may be rejected and thereby terminated. When leases expire or are terminated, replacement tenants may or may not be available upon acceptable terms and conditions. In addition, our cash flows and results of operations could be adversely impacted if existing leases expire or are terminated and at such time, market rental rates are lower than the previous contractual rental rates. As a result, our distributable cash flow and ability to make distributions to stockholders would be adversely affected if a significant number of our tenants fail to pay their rent due to bankruptcy, weakened financial condition or otherwise.
 
Uninsured losses and condemnation costs.  Accidents, earthquakes, terrorism incidents and other losses at our properties could materially adversely affect our operating results. Casualties may occur that significantly damage an operating property, and insurance proceeds may be materially less than the total loss incurred by us. Although we maintain casualty insurance under policies we believe to be adequate and appropriate, some types of losses, such as lease and other contract claims, generally are not insured. Certain types of insurance may not be available or may be available on terms that could result in large uninsured losses. We own property in California and other locations where property is subject to damage from earthquakes, as well as other natural catastrophes. We also own property that could be subject to loss due to terrorism incidents. The earthquake insurance and terrorism insurance markets, in particular, tend to be volatile and the availability and pricing of insurance to cover losses from earthquakes and terrorism incidents may be unfavorable from time to time. In addition, earthquakes and terrorism incidents could result in a significant loss that is uninsured due to the high level of deductibles or damage in excess of levels of coverage. Property ownership also involves potential liability to third parties for such matters as personal injuries occurring on the property. Such losses may not be fully insured. In addition to uninsured losses, various government authorities may condemn all or parts of operating properties. Such condemnations could adversely affect the viability of such projects.


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Environmental issues.  Environmental issues that arise at our properties could have an adverse effect on our financial condition and results of operations. Federal, state and local laws and regulations relating to the protection of the environment may require a current or previous owner or operator of real estate to investigate and clean up hazardous or toxic substances or petroleum product releases at a property. The owner or operator may have to pay a governmental entity or third parties for property damage and for investigation and clean-up costs incurred by such parties in connection with the contamination. These laws typically impose clean-up responsibility and liability without regard to whether the owner or operator knew of or caused the presence of the contaminants. Even if more than one person may have been responsible for the contamination, each person covered by the environmental laws may be held responsible for all of the clean-up costs incurred. In addition, third parties may sue the owner or operator of a site for damages and costs resulting from environmental contamination emanating from that site. We are not currently aware of any environmental liabilities at locations that we believe would have a material adverse effect on our business, assets, financial condition or results of operations. Unidentified environmental liabilities could arise, however, and could have an adverse effect on our financial condition and results of operations.
 
Joint venture structure risks.  Our venture partners have rights to take some actions over which we have no control, which could adversely affect our interests in the related joint ventures and in some cases our overall financial condition or results of operations. We have interests in a number of joint ventures (including partnerships and limited liability companies) and may in the future conduct our business through such structures. These structures involve participation by other parties whose interests and rights may not be the same as ours. For example, a venture partner might have economic and/or other business interests or goals which are unlike or incompatible with our business interests or goals and those venture partners may be in a position to take action contrary to our interests, including maintaining our REIT status. In addition, such venture partners may become bankrupt and such proceedings could have an adverse impact on the operation of the partnership or joint venture. Furthermore, the success of a project may be dependent upon the expertise, business judgment, diligence and effectiveness of our venture partners in matters that are outside our control. Thus, the involvement of venture partners could adversely impact the development, operation and ownership of the underlying properties, including any disposition of such underlying properties.
 
Regional concentration of properties.  Currently, a large percentage of our properties are located in metropolitan Atlanta, Georgia. In the future, there may be significant concentrations in metropolitan Atlanta, Georgia and/or other markets. If there is deterioration in any market in which we have significant holdings, our interests could be adversely affected, including, without limitation, loss in value of properties, decreased cash flows and inability to make or maintain distributions to stockholders.
 
Compliance or failure to comply with the Americans with Disabilities Act or other safety regulations and requirements could result in substantial costs.
 
The Americans with Disabilities Act generally requires that public buildings, including office, retail and multi-family buildings, be made accessible to disabled persons. Noncompliance could result in the imposition of fines by the federal government or the award of damages to private litigants. If, under the Americans with Disabilities Act, we are required to make substantial alterations and capital expenditures in one or more of our properties, including the removal of access barriers, it could adversely affect our financial condition and results of operations, as well as the amount of cash available for distribution to our stockholders.
 
Our properties are also subject to various federal, state and local regulatory requirements, such as state and local fire and life safety requirements. If we fail to comply with these requirements, we could incur fines or private damage awards. We do not know whether existing requirements will change or whether compliance with future requirements will require significant unanticipated expenditures that will affect our cash flow and results of operations.


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Real Estate Development Risks
 
We face risks associated with the development of real estate, such as delay, cost overruns and the possibility that we are unable to lease a large portion of the space that we build, which could adversely affect our results.
 
We generally undertake more commercial development activity relative to our size than other public real estate companies. Development activities contain certain inherent risks. Although we seek to minimize risks from commercial development through various management controls and procedures, development risks cannot be eliminated. Some of the key factors affecting development of commercial property are as follows:
 
  •  The availability of sufficient development opportunities.  Absence of sufficient development opportunities could result in our experiencing slower growth in earnings and cash flows. Development opportunities are dependent upon a wide variety of factors. From time to time, availability of these opportunities can be volatile as a result of, among other things, economic conditions and product supply/demand characteristics in a particular market.
 
  •  Abandoned predevelopment costs.  The development process inherently requires that a large number of opportunities be pursued with only a few being developed and constructed. We may incur significant costs for predevelopment activity for projects that are abandoned that directly affect our results from operations. We have procedures and controls in place that are intended to minimize this risk, but it is likely that there will be predevelopment costs charged to expense on an ongoing basis.
 
  •  Project costs.  Construction and leasing of a project involves a variety of costs that cannot always be identified at the beginning of a project. Costs may arise that have not been anticipated or actual costs may exceed estimated costs. These additional costs can be significant and could adversely impact our return on a project and the expected results from operations upon completion of the project. Also, construction costs rose significantly in 2006 due to increased demand for building materials and are expected to increase further in the near term. We attempt to mitigate construction cost risks on our development projects through guaranteed maximum price contracts and pre-ordering of certain materials, but we may be adversely affected by increased construction costs on our current and future projects.
 
  •  Leasing risk.  The success of a commercial real estate development project is dependent upon, among other factors, entering into leases with acceptable terms within a predefined lease-up period. Although our policy is to achieve preleasing goals (which vary by market, product type and circumstances) before committing to a project, it is likely only some percentage of the space in a project will be leased at the time we commit to the project. If the space is not leased on schedule and upon the expected terms and conditions, our returns, future earnings and results of operations from the project could be adversely impacted. Whether or not tenants are willing to enter into leases on the terms and conditions we project and on the timetable we expect will depend upon a large variety of factors, many of which are outside our control. These factors may include:
 
  •  general business conditions in the economy or in the tenants’ or prospective tenants’ industries;
 
  •  supply and demand conditions for space in the marketplace; and
 
  •  level of competition in the marketplace.
 
  •  Governmental approvals.  All necessary zoning, land-use, building, occupancy and other required governmental permits and authorization may not be obtained or may not be obtained on a timely basis resulting in possible delays, decreased profitability and increased management time and attention.


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Financing Risks
 
If interest rates or other market conditions for obtaining capital become unfavorable, we may be unable to raise capital needed to build our developments on a timely basis, or we may be forced to borrow money at higher interest rates or under adverse terms, which could adversely affect returns on our development projects, our cash flow and results of operations.
 
We finance our development projects through one or more of the following: our credit facility, permanent mortgages, proceeds from the sale of assets, secured and unsecured construction facilities, and joint venture equity. In addition, we have raised capital through the issuance of perpetual preferred stock to supplement our capital needs. Each of these sources may be constrained from time to time because of market conditions, and interest rates may be unfavorable at any given point in time. These sources of capital, and the risks associated with each, include the following:
 
  •  Credit facilities.  Terms and conditions available in the marketplace for credit facilities vary over time. We can provide no assurance that the amount we need from our credit facility will be available at any given time, or at all, or that the rates and fees charged by the lenders will be acceptable to us. We incur interest under our credit facility at a variable rate. Variable rate debt creates higher debt service requirements if market interest rates increase, which would adversely affect our cash flow and results of operations. Our credit facility contains customary restrictions, requirements and other limitations on our ability to incur indebtedness, including restrictions on total debt outstanding, restrictions on secured debt outstanding, requirements to maintain minimum debt service coverage ratios and minimum ratios of unencumbered assets to unsecured debt. Our continued ability to borrow under our credit facility is subject to compliance with our financial and other covenants. In addition, our failure to comply with such covenants could cause a default, and we may then be required to repay such debt with capital from other sources. Under those circumstances, other sources of capital may not be available to us, or may be available only on unattractive terms.
 
  •  Mortgage financing.  The availability of financing in the mortgage markets varies from time to time depending on various conditions, including the willingness of mortgage lenders to lend at any given point in time. Interest rates may also be volatile and we may from time to time elect not to proceed with mortgage financing due to unfavorable interest rates. This could adversely affect our ability to finance development activities. In addition, if a property is mortgaged to secure payment of indebtedness and we are unable to make the mortgage payments, the lender may foreclose, resulting in loss of income and asset value.
 
  •  Property sales.   Real estate markets tend to experience market cycles. Because of such cycles the potential terms and conditions of sales, including prices, may be unfavorable for extended periods of time. In addition, federal tax laws limit our ability to sell properties and this may affect our ability to sell properties without adversely affecting returns to our stockholders. These restrictions reduce our ability to respond to changes in the performance of our investments and could adversely affect our financial condition and results of operations. This could impair our ability to raise capital through property sales in order to fund our development projects or other cash needs. In addition, mortgage financing on a property may impose a prepayment penalty in the event the financing is prepaid, which may decrease the proceeds from a sale or refinancing or make the sale or refinancing impractical.
 
  •  Construction facilities.  Construction facilities generally relate to specific assets under construction and fund costs above an initial equity amount deemed acceptable to the lender. Terms and conditions of construction facilities vary but they generally carry a term of two to five years, charge interest at variable rates and require the lender to be satisfied with the nature and amount of construction costs prior to funding. While construction lending is competitive and offered by many financial institutions, there may be times when these facilities are not available or are only available upon unfavorable terms which could have an adverse effect on our ability to fund development projects or on our ability to achieve the returns we expect.
 
  •  Joint ventures.  Joint ventures, including partnerships or limited liability companies, tend to be complex arrangements, and there are only a limited number of parties willing to undertake such investment structures. There is no guarantee that we will be able to undertake these ventures at the times we need capital.


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  •  Preferred stock.  The availability of preferred stock at favorable terms and conditions is dependent upon a number of factors including the general condition of the economy, the overall interest rate environment, the condition of the capital markets and the demand for this product by potential holders of the securities. We can provide no assurance that conditions will be favorable for future issuances of perpetual preferred stock (or other equity securities) when we need the capital which could have an adverse effect on our ability to fund development projects.
 
Although we believe that in most economic and market environments we will be able to obtain necessary capital for our operations from the foregoing financing activities, we can make no assurances that the capital we need will be available when we need it. If we cannot obtain capital when we need it, we may not be able to develop and construct all the projects we could otherwise develop which could result in a reduction in our future earnings and cash flows. Lack of financing could also result in an inability to repay maturing debt which could result in defaults and, potentially, loss of properties, as well as an inability to make distributions to stockholders. Unfavorable interest rates could adversely impact both the cost of our projects (through capitalized interest) and our current earnings and cash flows.
 
Covenants contained in our credit facility and mortgages could restrict or hinder our operational flexibility, which could adversely affect our results of operations.
 
Our credit facility imposes financial and operating covenants on us. These covenants may be modified from time to time, but covenants of this type typically include restrictions and limitations on our ability to incur debt and certain forms of equity capital, as well as limitations on the amount of our unsecured debt, limitations on payments to stockholders, and limitations on the amount of development and joint venture activity in which we may engage. These covenants may limit our flexibility in making business decisions. If we fail to meet those covenants, our ability to borrow may be impaired, which could potentially make it more difficult to fund our capital and operating needs. Additionally, some of our properties are subject to mortgages. These mortgages contain customary negative covenants, including limitations on our ability, without the lender’s prior consent, to further mortgage that property, to modify existing leases or to sell that property. Compliance with these covenants could harm our operational flexibility and financial condition.
 
Risks Associated with Multi-Family Projects
 
Any failure to timely sell the multi-family units developed by our Office/Multi-Family Division or an increase in development costs could adversely affect our results of operations.
 
Our Office/Multi-Family Division develops for-sale multi-family residential projects currently in urban markets. Multi-family unit sales can be highly cyclical and can be affected by interest rates and local issues. Once a project is undertaken, we can provide no assurance that we will be able to sell the units in a timely manner which could result in significantly increased carrying costs and erosion or elimination of profit with respect to any project.
 
In addition, actual construction and development costs of the multi-family residential projects can exceed estimates for various reasons. As these projects are normally multi-year projects, the market demand for multi-family residences may change between commencement of a project and its completion. Any estimates of sales and profits may differ substantially from our actual sales and profits and, as a result, our results of operations may differ substantially from any estimates.
 
Any failure to receive cash corresponding to previously recognized revenues could adversely affect our future results of operations.
 
In accordance with accounting principles generally accepted in the United States, we recognize revenues and profits from sales of multi-family residential units during the course of construction. Revenue is recorded when, among other factors, (1) construction is beyond a preliminary stage, (2) the buyer is committed to the extent of being unable to require a full refund, except for nondelivery of the residence, (3) a substantial percentage of units are under non-cancelable contracts, (4) collection of the sales price is reasonably assured and (5) costs can be reasonably estimated. Due to various contingencies, such as delayed construction and buyer defaults, we may


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receive less cash than the amount of revenue already recognized or the cash may be received at a later date than we expected, which could affect amounts of revenue previously recognized and our ultimate profitability on the project.
 
Risks Associated with our Land Division
 
Any failure to timely sell the lots developed by our Land Division could adversely affect our results of operations.
 
Our land division develops residential subdivisions, primarily in metropolitan Atlanta, Georgia. Our land division also participates in joint ventures that develop or plan to develop subdivisions in metropolitan Atlanta, as well as Texas, Florida and other states. This division also from time to time supervises sales of unimproved properties owned or controlled by us. Residential lot sales can be highly cyclical and can be affected by interest rates and local issues, including the availability of jobs, transportation and the quality of public schools. Once a development is undertaken, no assurances can be given that we will be able to sell the various developed lots in a timely manner. Failure to sell such lots in a timely manner could result in significantly increased carrying costs and erosion or elimination of profit with respect to any development.
 
In addition, actual construction and development costs with respect to subdivisions can exceed estimates for various reasons, including unknown site conditions. The timing of subdivision lot sales and unimproved property sales are, by their nature, difficult to predict with any precision. Additionally, some of our residential properties are multi-year projects, and market conditions may change between the time we decide to develop a property and the time that all or some of the lots or tracts may be ready for sale. Similarly, we often hold undeveloped land for long periods of time prior to sale. Any changes in market conditions between the time we acquire land and the time we sell land, could cause the Company’s estimates of proceeds and related profits from such sales to be lower or result in an impairment charge. Estimates of sales and profits may differ substantially from actual sales and profits and as a result, our results of operations may differ substantially from these estimates.
 
Any failure to timely sell or lease non-income producing land could adversely affect our results of operations.
 
We maintain significant holdings of non-income producing land in the form of land tracts and outparcels. Our strategy with respect to these parcels of land include (1) developing the land at a future date as a retail, office, industrial or mixed-use income producing property or developing it for single-family or multi-family residential uses; (2) ground leasing the land to third parties; and (3) in certain circumstances, selling the parcels to third parties. Before we develop, lease or sell these land parcels, we incur carrying costs, including interest expense and property tax expense.
 
If we are unable to sell this land or convert it into income producing property in a timely manner, our results of operations and liquidity could be adversely affected.
 
Risks Associated with our Third Party Management Business
 
Our third party business may experience volatility based on a number of factors, including termination of contracts, which could adversely affect our results of operations.
 
We engage in third party development, leasing, property management, asset management and property services to unrelated property owners. Contracts for such services are generally short-term in nature and permit termination without extensive notice. Fees from such activities can be volatile due to unexpected terminations of such contracts. Extensive unexpected terminations could materially adversely affect our results of operations. Further, the timing of the generation of new contracts for services is difficult to predict.


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General Business Risks
 
We may not adequately or accurately assess new opportunities, which could adversely impact our results of operations.
 
Our estimates and expectations with respect to new lines of business and opportunities may differ substantially from actual results, and any losses from these endeavors could materially adversely affect our results of operations. We conduct business in an entrepreneurial manner. We seek opportunities in various sectors of real estate and in various geographical areas and from time to time undertake new opportunities, including new lines of business. Not all opportunities or lines of business prove to be profitable. We expect from time to time that some of our business ventures may have to be terminated because they do not meet our profit expectations. Termination of these ventures may result in the write off of certain related assets and/or the termination of personnel, which would adversely impact results of operations.
 
We are dependent upon key personnel, the loss of any of whom could adversely impair our ability to execute our business.
 
One of our objectives is to develop and maintain a strong management group at all levels. At any given time we could lose the services of key executives and other employees. None of our key executives or other employees are subject to employment agreements or contracts. Further, we do not carry key person insurance on any of our executive officers or other key employees. The loss of services of any of our key employees could have an adverse impact upon our results of operations, financial condition and our ability to execute our business strategy.
 
Our restated and amended articles of incorporation contain limitations on ownership of our stock, which may prevent a change in control that might otherwise be in the best interests of our stockholders.
 
Our restated and amended articles of incorporation impose limitations on the ownership of our stock. In general, except for certain individuals who owned stock at the time of adoption of these limitations, no individual or entity may own more than 3.9% of the value of our outstanding stock. The ownership limitation may have the effect of delaying, inhibiting or preventing a transaction or a change in control that might involve a premium price for our stock or otherwise be in the best interest of our stockholders.
 
Federal Income Tax Risks
 
Any failure to continue to qualify as a real estate investment trust for federal income tax purposes could have a material adverse impact on us and our stockholders.
 
Cousins intends to operate in a manner to qualify as a REIT for federal income tax purposes. However, we can provide no assurance that Cousins has qualified or will remain qualified as a REIT. Qualification as a REIT involves the application of highly technical and complex provisions of the Internal Revenue Code (the “Code”), for which there are only limited judicial or administrative interpretations. Certain facts and circumstances not entirely within our control may affect our ability to qualify as a REIT. In addition, we can provide no assurance that legislation, new regulations, administrative interpretations or court decisions will not adversely affect Cousins’ qualification as a REIT or the federal income tax consequences of Cousins’ REIT status.
 
If Cousins were to fail to qualify as a REIT, it would not be allowed a deduction for distributions to stockholders in computing its taxable income. In this case, it would be subject to federal income tax (including any applicable alternative minimum tax) on its taxable income at regular corporate rates. Unless entitled to relief under certain Code provisions, it also would be disqualified from treatment as a REIT for the four taxable years following the year during which qualification was lost. As a result, the cash available for distribution to our stockholders would be reduced for each of the years involved. Although Cousins currently intends to operate in a manner designed to qualify as a REIT, it is possible that future economic, market, legal, tax or other considerations may cause us to revoke the REIT election.
 
In order to qualify as a REIT, under current law, Cousins generally is required each taxable year to distribute to its stockholders at least 90% of its net taxable income (excluding any net capital gain). To the extent that Cousins does not distribute all of its net capital gain or it distributes at least 90%, but less than 100%, of its other taxable


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income, Cousins is subject to tax on the undistributed amounts at regular corporate rates. In addition, Cousins is subject to a 4% nondeductible excise tax to the extent that distributions paid by Cousins during the calendar year are less than the sum of the following:
 
  •  85% of its ordinary income;
 
  •  95% of its net capital gain income for that year, and
 
  •  100% of its undistributed taxable income (including any net capital gains) from prior years.
 
We intend to make distributions to our stockholders to comply with the 90% distribution requirement, to avoid corporate-level tax on undistributed taxable income and to avoid the nondeductible excise tax. Differences in timing between taxable income and cash available for distribution could require Cousins to borrow funds to meet the 90% distribution requirement, to avoid corporate-level tax on undistributed taxable income and to avoid the nondeductible excise tax. Satisfying the distribution requirements may also make it more difficult to fund new development projects.
 
Certain property transfers may be characterized as prohibited transactions, resulting in a tax on any gain attributable to the transaction.
 
From time to time, we may transfer or otherwise dispose of some of our properties. Under the Code, any gain resulting from transfers or dispositions, from other than our taxable REIT subsidiary, deemed to be prohibited transactions would be subject to a 100% tax on any gain associated with the transaction. Prohibited transactions generally include sales of assets that constitute inventory or other property held for sale to customers in the ordinary course of business. Since we acquire properties primarily for investment purposes, we do not believe that our occasional transfers or disposals of property are deemed to be prohibited transactions. However, whether property is held for investment purposes is a question of fact that depends on all the facts and circumstances surrounding the particular transaction. The Internal Revenue Service may contend that certain transfers or disposals of properties by us are prohibited transactions. While we believe that the Internal Revenue Service would not prevail in any such dispute, if the Internal Revenue Service were to argue successfully that a transfer or disposition of property constituted a prohibited transaction, we would be required to pay a tax equal to 100% of any gain allocable to us from the prohibited transaction. In addition, income from a prohibited transaction might adversely affect our ability to satisfy the income tests for qualification as a REIT for federal income tax purposes.
 
Disclosure Controls and Internal Control over Financial Reporting Risks
 
Our business could be adversely impacted if we have deficiencies in our disclosure controls and procedures or internal control over financial reporting.
 
The design and effectiveness of our disclosure controls and procedures and internal control over financial reporting may not prevent all errors, misstatements or misrepresentations. While management will continue to review the effectiveness of our disclosure controls and procedures and internal control over financial reporting, there can be no guarantee that our internal control over financial reporting will be effective in accomplishing all control objectives at all times. Deficiencies, including any material weakness, in our internal control over financial reporting which may occur in the future could result in misstatements of our results of operations, restatements of our financial statements, a decline in our stock price, or otherwise materially adversely affect our business, reputation, results of operations, financial condition or liquidity.
 
Item 1B.   Unresolved Staff Comments
 
Not applicable.


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Item 2.  Properties
 
The following tables set forth certain information relating to properties in which the Company has a 10% or greater ownership interest. Information presented in Note 6 to the Consolidated Financial Statements included in Item 8 of this report provides additional information related to the Company’s joint ventures. All information presented is as of December 31, 2006. Dollars are stated in thousands.
 
Table of Major Operating Office, Retail and Industrial Properties
 
                                                                                 
                                    Cost and
       
                    Percentage
  Average
          Cost Less
      Debt
    Year
              Leased
  2006
      Major
  Depreciation
      Maturity
    Development
      Company’s
      as of
  Economic
  Major Tenants (Lease
  Tenants’
  and
      and
Description
  Completed
  Venture
  Ownership
  Square Feet
  December 31,
  Occupancy
  Expiration/Options
  Rentable
  Amortization
  Debt
  Interest
and Location
  or Acquired   Partner   Interest   and Acres   2006   (1)  
Expiration)
  Sq. Feet   (2)   Balance   Rate
 
Office
                                                                               
                                                                                 
191 Peachtree Tower(3)
Atlanta, GA
    2006     N/A     100 %     1,211,000       60 %     52 %   Wachovia Bank (2008/2023)     380,442     $ 146,367     $ 0       N/A  
                          2 Acres (3)                   Deloitte & Touche (2008/2018)     99,465     $ 144,389                  
                                                Cousins Properties (2017/2022)     61,674                          
                                                                                 
Inforum
Atlanta, GA
    1999     N/A     100 %     994,000       98 %     86 %   American Cancer Society (2022)     273,745     $ 79,835     $ 0       N/A  
                          4 Acres (4)                   BellSouth Corporation (5) (2009)     138,893     $ 38,424                  
                                                Georgia Lottery Corp. (2013)     127,827                          
                                                Co Space Services, LLC     120,298                          
                                                (2020/2025)                                
                                                Turner Broadcasting (2011/2016)     57,827                          
                                                Sapient Corporation (2009/2019)     57,689                          
                                                                                 
The Points at Waterview
Suburban Dallas, Texas
    2000     N/A     100 %     203,000       99 %     98 %   Bombardier Aerospace Corp.     97,740     $ 30,394     $ 18,183       1/1/16  
                          15 Acres                     (2013/2023)           $ 22,375               5.66 %
                                                Liberty Mutual (2011/2021)     28,124                          
                                                NetHawk Acquisition Corp. (2009)     16,968                          
Lakeshore Park Plaza
Birmingham, AL
    1998     Daniel Realty     100 %(6)     195,000       75 %     57 %   Synovus Mortgage (2014/2019)     28,932     $ 18,097     $ 9,082       11/1/08  
            Company             12 Acres                     Dent & Baker (2017)     11,331     $ 13,975               6.78 %
                                                Daxco (2009/2014)     9,318                          
                                                General Services (2008)     7,806                          
600 University Park Place
Birmingham, AL
    2000     Daniel Realty     100 %(6)     123,000       98 %     74 %   Southern Communications Services(5)     41,961     $ 18,599     $ 13,168       8/10/11  
            Company             10 Acres                     (2010/2016)           $ 14,268               7.38 %
                                                O2 Ideas, Inc. (2014/2024)     25,465                          
100 North Point Center East
Suburban Atlanta, GA
    1995     N/A     100 %     128,000       89 %     89 %   Schweitzer-Mauduit           $ 12,603     $ 22,365 (7)     8/1/07  
                          7 Acres                     International, Inc. (2012)     32,655     $ 9,469               7.86 %
                                                Med Assets HSCA, Inc. (2013/2018)     21,914                          
                                                Golden Peanut Co. (2017)     18,104                          
200 North Point Center East
Suburban Atlanta, GA
    1996     N/A     100 %     130,000       95 %     75 %   Med Assets HSCA, Inc. (2013/2018)     67,015     $ 10,764       (7)     (7)
                          9 Acres                     Nokia (2008)     22,409     $ 8,930                  
                                                Morgan Stanley (2011)     15,709                          
                                                B2B Workforce, Inc. (2008/2013)     14,171                          


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                                    Cost and
       
                    Percentage
  Average
          Cost Less
      Debt
    Year
              Leased
  2006
      Major
  Depreciation
      Maturity
    Development
      Company’s
      as of
  Economic
  Major Tenants (Lease
  Tenants’
  and
      and
Description
  Completed
  Venture
  Ownership
  Square Feet
  December 31,
  Occupancy
  Expiration/Options
  Rentable
  Amortization
  Debt
  Interest
and Location
  or Acquired   Partner   Interest   and Acres   2006   (1)  
Expiration)
  Sq. Feet   (2)   Balance   Rate
 
Office (Continued)
                                                                               
                                                                                 
333 North Point Center East
Suburban Atlanta, GA
    1998     N/A     100 %     130,000       79 %     70 %   Merrill Lynch (2014/2024)     35,949     $ 13,456     $ 29,571 (8)     11/1/11  
                          9 Acres                     Wells Fargo Bank NA (2009/2012)     22,438     $ 8,744               7.00 %
                                                Phillip Morris (2008/2013)     17,521                          
                                                                                 
555 North Point Center East
Suburban Atlanta, GA
    2000     N/A     100 %     152,000       90 %     88 %   Kids II, Inc. (2016/2026)     51,059     $ 17,592       (8)     (8 )
                          10 Acres                     Regus Business Centre     22,422     $ 12,586                  
                                                (2011/2016)                                
                                                Ace Mortgage (2008/2011)     11,433                          
                                                Robert W. Baird (2011/2016)     11,074                          
                                                                                 
Galleria 75
Suburban Atlanta, GA
    2004     N/A     100 %     114,000       75 %     85 %   THD At-Home Services (2008)     24,259     $ 11,734     $ 0       N/A  
                          7 Acres                                 $ 10,233                  
                                                                                 
3301 Windy Ridge Parkway
Atlanta, GA
    1984     N/A     100 %     107,000       42 %     48 %   Indus International, Inc.     45,557     $ 12,413     $ 0       N/A  
                          10 Acres                     (2012/2017)           $ 5,349                  
                                                                                 
3100 Windy Hill Road
Atlanta, GA
    1983     N/A     100 %(9)     188,000       0 %     92 %   N/A           $ 17,314     $ 0       N/A  
                          13 Acres                                 $ 10,445                  
                                                                                 
Cosmopolitan Center
Atlanta, GA
    2006     N/A     100 %     102,000       73 %     71 %   City of Sandy Springs (2007/2009)     32,800     $ 12,046     $ 0       N/A  
                          9 Acres                                 $ 11,804                  
                                                                                 
One Georgia Center
Atlanta, GA
    2000     Prudential (5)     88.5 %     344,000       46 %     37 %   Southern Christian Leadership (2007)     14,501     $ 42,136     $ 0       N/A  
                          3 Acres                     Roman Catholic Archdiocese (2009)     13,699     $ 35,567                  
                                                Hamilton, Westby, Marshall (2017)     11,070                          
                                                                                 
Gateway Village
Charlotte, NC
    2001     Bank of America (5)     50 %     1,065,000       100 %     100 %   Bank of America (5) (2016/2035)     1,065,000     $ 211,142     $ 144,654       12/1/16  
                          8 Acres                                 $ 175,307               6.41 %
                                                                                 
Ten Peachtree Place
Atlanta, GA
    1991     Coca-Cola (5)     50 %     259,000       87 %     96 %   AGL Services Co. (2013/2028)     226,779     $ 40,594     $ 28,849       4/1/15  
                          5 Acres                                 $ 25,367               5.39 %
                                                                                 
Meridian Mark Plaza
Atlanta, GA
    1999     N/A     100 %     160,000       100 %     100 %   Northside Hospital (5)     57,614     $ 25,957     $ 23,602       9/1/10  
                          3 Acres                     (2013/2023) (10)           $ 17,483               8.27 %
                                                Scottish Rite Hospital for     31,676                          
                                                Crippled Children, Inc. (2013/2018)(10)                                
                                                Georgia Reproductive (2017)     13,622                          
                                                Children Orthopedics (2009/2014)     12,721                          


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                                    Cost and
       
                    Percentage
  Average
          Cost Less
      Debt
    Year
              Leased
  2006
      Major
  Depreciation
      Maturity
    Development
      Company’s
      as of
  Economic
  Major Tenants (Lease
  Tenants’
  and
      and
Description
  Completed
  Venture
  Ownership
  Square Feet
  December 31,
  Occupancy
  Expiration/Options
  Rentable
  Amortization
  Debt
  Interest
and Location
  or Acquired   Partner   Interest   and Acres   2006   (1)  
Expiration)
  Sq. Feet   (2)   Balance   Rate
 
Office (Continued)
                                                                               
                                                                                 
AtheroGenics
Suburban Atlanta, GA
    1999     N/A     100 %     51,000       100 %     100 %   AtheroGenics (2009/2019)     50,821     $ 7,655     $ 0       N/A  
                          4 Acres                                 $ 3,506                  
                                                                                 
Inhibitex
Suburban Atlanta, GA
    2005     N/A     100 %     51,000       100 %     100 %   Inhibitex (2015/2025)     50,933     $ 6,634     $ 0       N/A  
                          5 Acres                                 $ 6,023                  
                                                                                 
Emory Crawford Long Medical Office Tower
Atlanta, GA
    2002     Emory University     50 %     358,000       100 %     98 %   Emory University (2017/2047)     148,741     $ 52,338     $ 52,404       6/1/13  
                          (11 )                   Resurgens (2014/2019)     26,581     $ 40,184               5.90 %
                                                Atlanta Gastroenterology (2012)     17,375                          
                                                                                 
Presbyterian Medical Plaza at University
Charlotte, NC
    1997     Prudential (5)     11.5 %     69,000       100 %     100 %   Novant Health, Inc.     63,862     $ 8,622     $ 0       N/A  
                          1 Acre (12 )                   (2012/2022) (13)           $ 5,289                  


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Table of Contents

 
Lease Expirations — Office
 
As of December 31, 2006, the Company’s office portfolio included 20 commercial office buildings, excluding all properties currently under development, held for redevelopment and buildings in lease-up stage. The weighted average remaining lease term of these office buildings was approximately seven years as of December 31, 2006. Most of the major tenant leases in these buildings provide for pass through of operating expenses and contractual rents which escalate over time. The leases expire as follows:
 
                                                                                         
                                        2016 &
   
    2007   2008   2009   2010   2011   2012   2013   2014   2015   Thereafter   Total
 
Total (including Company’s % share of Joint Venture Properties):
                                                                                       
Square Feet Expiring(14)
    128,579       241,820       459,856       162,599       322,486       167,914       536,232       148,207       618,869       571,360       3,357,922  
% of Leased Space
    4 %     7 %     14 %     5 %     10 %     5 %     16 %     4 %     18 %     17 %     100 %
Annual Contractual Rent (000’s) (15)
  $ 1,643     $ 3,815     $ 7,147     $ 2,576     $ 4,838     $ 2,813     $ 9,944     $ 3,158     $ 11,749     $ 12,446     $ 60,129  
Annual Contractual
                                                                                       
Rent/Sq. Ft.(15)
  $ 12.78     $ 15.78     $ 15.54     $ 15.85     $ 15.00     $ 16.75     $ 18.54     $ 21.31     $ 18.98     $ 21.78     $ 17.91  
Wholly Owned:
                                                                                       
Square Feet Expiring(14)
    86,433       221,670       426,278       146,984       296,059       112,074       402,262       143,413       56,794       493,837       2,385,804 (16)
% of Leased Space
    4 %     9 %     18 %     6 %     12 %     5 %     17 %     6 %     2 %     21 %     100 %
Annual Contractual Rent (000’s)(15)
  $ 1,197     $ 3,569     $ 6,648     $ 2,340     $ 4,434     $ 1,761     $ 7,476     $ 3,046     $ 1,273     $ 10,554     $ 42,298  
Annual Contractual
                                                                                       
Rent/Sq. Ft.(15)
  $ 13.85     $ 16.10     $ 15.60     $ 15.92     $ 14.98     $ 15.71     $ 18.58     $ 21.24     $ 22.42     $ 21.37     $ 17.73  
Joint Venture:
                                                                                       
Square Feet Expiring(14)
    82,305       23,281       51,081       23,541       38,511       123,528       259,810       9,587       1,112,872       151,426       1,875,942 (17)
% of Leased Space
    4 %     1 %     3 %     1 %     2 %     7 %     14 %     1 %     59 %     8 %     100 %
Annual Contractual Rent (000’s)(15)
  $ 1,113     $ 289     $ 855     $ 402     $ 661     $ 2,419     $ 4,841     $ 223     $ 20,795     $ 3,722     $ 35,320  
Annual Contractual
                                                                                       
Rent/Sq. Ft.(15)
  $ 13.52     $ 12.40     $ 16.73     $ 17.06     $ 17.17     $ 19.59     $ 18.63     $ 23.30     $ 18.69     $ 24.58     $ 18.83  


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Table of Contents

 
                                                                         
                      Percentage
                    Cost and
          Debt
 
    Year
                Leased
    Average
        Major
    Cost Less
          Maturity
 
    Development
      Company’s
        as of
    2006
    Major Tenants (Lease
  Tenants’
    Depreciation
          and
 
Description
  Completed
  Venture
  Ownership
    Square Feet
  December 31,
    Economic
    Expiration/Options
  Rentable
    and
    Debt
    Interest
 
and Location
  or Acquired   Partner   Interest    
and Acres
  2006     Occupancy(1)    
Expiration)
 
Sq. Feet
    Amortization(2)     Balance     Rate  
 
Retail Centers
                                                                       
The Avenue Carriage Crossing
Suburban Memphis, TN
  2005   Jim Wilson &     100 %(6)   783,000 (18)     93 %(19)     89 % (19)   Dillard’s (20)     N/A     $ 90,892     $ 0       N/A  
        Associates(5)           135 acres                   Parisian (2021/2051)(21)     130,000     $ 85,471                  
                    (492,000 owned                   Linens ‘n Things (2016/2031)     28,331                          
                    by Carriage                   Barnes & Noble (2016/2026)     25,322                          
                    Avenue, LLC)                   Cost Plus (2016/2031)     18,200                          
San Jose MarketCenter
San Jose, CA
  2006   N/A     100 %   363,000(18)     89 %(19)     79 %(19)   Target (20)     N/A     $ 79,958     $ 0       N/A  
                    25 acres                   Marshall’s (2016/2036)     33,000     $ 78,829                  
                    (220,000 owned                   PetsMart (2017/2032)     27,627                          
                    by the Company)                   Michael’s (2016/2031)     23,819                          
                                        Office Depot (2016/2026)     20,526                          
                                        Cost Plus (2017/2032)     18,900                          
                                        Trader Joe’s (2017/2032)     12,200                          
The Avenue Webb Gin
Suburban Atlanta, GA
  2006   N/A     100 %   381,000(18)     71 %(19)     50 %(19)   Barnes & Noble (2016/2026)     26,610     $ 69,757     $ 0       N/A  
                    51 acres                   Ethan Allen (2021/2031)     18,511     $ 68,982                  
                                        GAP (2012/2022)     17,461                          
The Avenue Viera
Viera, FL
  2005   Prudential(5)     11.5 %(6)   406,000(18)     95 %     82 %   Rave Motion Pictures(20)     N/A     $ 87,061 (22)   $ 0       N/A  
                    56 Acres                   Belk, Inc. (2024/2044)(21)     65,927     $ 85,526 (22)                
                    (332,000 owned                   Bed, Bath & Beyond (2015/2035)     24,329                          
                    by CP Venture IV                   A.C. Moore (2016/2036)     20,800                          
                    Holdings LLC)                   Cost Plus (2017/2037)     18,300                          
                                        Books a Million (2015/2035)     14,795                          
                                        Old Navy (2010/2020)     14,754                          
The Avenue East Cobb
Suburban Atlanta, GA
  1999   Prudential(5)     11.5 %   231,000     97 %     99 %   Borders, Inc. (2015/2030)     24,882     $ 97,429 (22)   $ 39,364 (23)     8/1/10  
                    30 Acres                   Bed, Bath & Beyond (2010/2025)     21,007     $ 95,893 (22)             8.39 %
                                        GAP (2010/2015)     19,434                          
                                        Talbots (2010/2015)     12,905                          
                                        Pottery Barn (5)(2012)     10,000                          
The Avenue West Cobb
Suburban Atlanta, GA
  2003   Prudential(5)     11.5 %   251,000(18)     98 %     96 %   Linens ‘n Things (2014/2029)     28,030     $ 81,254 (22)   $ 0       N/A  
                    22 Acres                   Barnes & Noble (2014/2024)     24,025     $ 79,635 (22)                
                                        GAP (2012/2022)     17,520                          
The Avenue Peachtree City
Suburban Atlanta, GA
  2001   Prudential(5)     11.5 %   183,000(18)     98 %     97 %   Books a Million (2008/2013)     13,750     $ 57,642 (22)   $ 0       N/A  
                    18 Acres (24)                   GAP (2012/2022)     10,800     $ 56,005 (22)                
                                        Homebanc Mortgage Corporation     8,851                          
                                          (2007/2012)                                
                                        Talbots (2012/2022)     8,610                          
                                        Banana Republic (2012/2022)     8,015                          
Viera MarketCenter
Viera, FL
  2005   Prudential(5)     11.5 %(6)   178,000(18)     95 %     94 %   Kohl’s Department Stores, Inc.     88,248     $ 17,075 (22)   $ 0       N/A  
                    20 Acres                     (2026/2056) (21)           $ 16,838 (22)                
                                        Sports Authority (2017/2032)     37,516                          
                                        Office Depot (2016/2036)     20,000                          


19


Table of Contents

                                                                         
                      Percentage
                    Cost and
          Debt
 
    Year
                Leased
    Average
        Major
    Cost Less
          Maturity
 
    Development
      Company’s
        as of
    2006
    Major Tenants (Lease
  Tenants’
    Depreciation
          and
 
Description
  Completed
  Venture
  Ownership
    Square Feet
  December 31,
    Economic
    Expiration/Options
  Rentable
    and
    Debt
    Interest
 
and Location
  or Acquired   Partner   Interest    
and Acres
  2006     Occupancy(1)    
Expiration)
 
Sq. Feet
    Amortization(2)     Balance     Rate  
 
North Point MarketCenter
Suburban Atlanta, GA
  1994   Prudential(5)     10.32 %(25)   518,000 (18)     100 %     99 %   Target (20)     N/A     $ 58,173     $ 0       N/A  
                    60 Acres                   Babies ‘‘R” Us (2012/2032)     50,275     $ 41,986                  
                    (401,000                   Dick’s Sporting Goods (2017/2037)     48,884                          
                    square feet                   Marshalls (2010/2025)     40,000                          
                    and 49 acres                   Hudson’s Furniture (5) (2011/2021)     40,000                          
                    owned by                   Linens ‘n Things (2010/2025)     35,000                          
                    CP Venture                   Regal Cinemas (2014/2034)     34,733                          
                    LLC)                   Circuit City (2015/2030)     33,420                          
                                        PetsMart, Inc. (2009/2029)     25,465                          
Greenbrier MarketCenter
Chesapeake, VA
  1996   Prudential(5)     10.32 %(25)   493,000(18)     100 %     100 %   Target (20)     N/A     $ 49,107     $ 0       N/A  
                    44 Acres                   Harris Teeter, Inc. (2016/2036)     51,806     $ 35,436                  
                    (376,000 square                   Best Buy (2015/2030)     45,106                          
                    feet and 36 acres                   Bed, Bath & Beyond (2012/2027)     40,484                          
                    owned by                   Babies ‘‘R” Us (2011/2021)     40,000                          
                    CP Venture                   Stein Mart, Inc. (2011/2026)     36,000                          
                    LLC)                   Barnes & Noble Superstores, Inc. (2012/2022)     29,974                          
                                        PetsMart, Inc. (2011/2031)     26,040                          
                                        Office Max (2011/2026)     23,484                          
Los Altos MarketCenter
Long Beach, CA
  1996   Prudential(5)     10.32 %(25)   182,000     100 %     100 %   Sears (20)     N/A     $ 32,864     $ 0       N/A  
                    (157,000 square                   Circuit City (2017/2037)     38,541     $ 24,685                  
                    feet and 17 acres                   Borders, Inc. (2017/2037)     30,000                          
                    owned by                   Bristol Farms (5) (2012/2032)     28,200                          
                    CP Venture                   CompUSA, Inc. (2011/2021)     25,620                          
                    LLC)                                                    
Mansell Crossing Phase II
Suburban Atlanta, GA
  1996   Prudential(5)     10.32 %(25)   103,000     100 %     100 %   Bed, Bath & Beyond (2012/2027)     40,787     $ 12,639     $ 0       N/A  
                    13 Acres                   Ross Stores Inc. (2014/2034)     32,144     $ 9,238                  
                                        Rooms To Go (2016/2036)     21,000                          
Stand Alone Retail Sites Adjacent to Company’s Retail Projects
                                                                       
North Point (26)
Suburban Atlanta, GA
  1993   N/A     100 %   11 Acres     100 %     100 %   N/A     N/A     $ 1,612     $ 0       N/A  
                                                    $ 1,470                  

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Table of Contents

Lease Expirations — Retail
 
As of December 31, 2006, the Company’s retail portfolio included 10 retail properties, excluding all properties currently under development and/or in lease-up. The weighted average remaining lease term of these retail properties was approximately 11 years as of December 31, 2006. Most of the major tenant leases in these retail properties provide for pass through of operating expenses and contractual rents which escalate over time. The leases expire as follows:
 
                                                                                         
                                                          2016 &
       
    2007     2008     2009     2010     2011     2012     2013     2014     2015     Thereafter     Total  
 
Total (including only Company’s  % share of Joint Venture Properties):
                                                                                       
Square Feet Expiring
    18,997       10,311       8,652       28,515       64,822       34,146       14,895       23,718       73,376       417,003       694,435  
% of Leased Space
    3 %     1 %     1 %     4 %     9 %     5 %     2 %     4 %     11 %     60 %     100 %
Annual Contractual Rent (000’s)(15)
  $ 374     $ 260     $ 189     $ 635     $ 1,275     $ 639     $ 381     $ 503     $ 2,043     $ 6,857     $ 13,156  
Annual Contractual Rent/Sq. Ft.(15)
  $ 19.69     $ 25.21     $ 21.86     $ 22.26     $ 19.66     $ 18.71     $ 25.61     $ 21.23     $ 27.84     $ 16.44     $ 18.95  
Wholly Owned:
                                                                                       
Square Feet Expiring
    10,282       3,000             6,394       32,060             4,482             49,086       351,664       456,968(27 )
% of Leased Space
    2 %     1 %     0 %     1 %     7 %     0 %     1 %     0 %     11 %     77 %     100 %
Annual Contractual Rent (000’s)(15)
  $ 173     $ 102     $     $ 210     $ 716     $     $ 108     $     $ 1,550     $ 5,793     $ 8,652  
Annual Contractual
                                                                                       
Rent/Sq. Ft.(15)
  $ 16.84     $ 33.88     $     $ 32.80     $ 22.33     $     $ 24.00     $     $ 31.58     $ 16.47     $ 18.93  
Joint Venture:
                                                                                       
Square Feet Expiring
    80,298       65,083       80,208       202,154       310,106       318,171       91,783       213,108       219,279       591,120       2,171,310(28 )
% of Leased Space
    4 %     3 %     4 %     9 %     14 %     15 %     4 %     10 %     10 %     27 %     100 %
Annual Contractual Rent (000’s)(15)
  $ 1,840     $ 1,408     $ 1,728     $ 3,831     $ 5,195     $ 5,869     $ 2,402     $ 4,481     $ 4,385     $ 9,676     $ 40,815  
Annual Contractual Rent/Sq. Ft.(15)
  $ 22.92     $ 21.63     $ 21.55     $ 18.95     $ 16.75     $ 18.44     $ 26.18     $ 21.03     $ 20.00     $ 16.37     $ 18.80  
 
                                                                         
                    Percentage
              Cost and
      Debt
    Year
              Leased
  Average
      Major
  Cost Less
      Maturity
Description
  Development
      Company’s
      as of
  2006
  Major Tenants (Lease
  Tenants’
  Depreciation
      and
and
  Completed
  Venture
  Ownership
  Square Feet
  December 31,
  Economic
  Expiration/Options
  Rentable
  and
  Debt
  Interest
Location
  or Acquired   Partner   Interest  
and Acres
  2006   Occupancy(1)  
Expiration)
 
Sq. Feet
  Amortization(2)   Balance   Rate
 
Industrial
                                                                       
King Mill Distribution Park
Building 3A, Phase 1
Suburban Atlanta, GA
  2006   Weeks Properties Group     75 %   417,000     100 %     40 % (29)   Simplicity Manufacturing, Inc.     417,000     $ 13,610     $ 2,625       8/30/08  
                    22 Acres                   (2012/2017)           $ 13,334               9.0 %


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Lease Expirations — Industrial
 
As of December 31, 2006, the Company’s industrial portfolio included one fully operational building in the King Mill Distribution Park — Building 3A, Phase I. The tenant lease in this building provides for pass through of operating expenses and contractual rents which escalate over time. The lease expires in 2012.
 
FOOTNOTES
 
 
(1) Average economic occupancy is calculated as the percentage of the property for which revenue was recognized during the year. If the property was purchased during the year, average economic occupancy is calculated from the date of purchase forward. If the project has an expansion that was under construction during the year, average economic occupancy for the expansion portion is only included after it becomes partially operational.
 
(2) Cost as shown in the accompanying table includes deferred leasing costs and other tangible related assets.
 
(3) 191 Peachtree Tower is treated as an operational property for financial reporting purposes, although the Company considers this property as a redevelopment project in some of its external reports and analyses. Also, the acreage numbers include 0.8 acres under a ground lease which expires in 2086.
 
(4) Approximately 0.18 acres of the total four acres of land at Inforum are under a ground lease expiring in 2068.
 
(5) Actual tenant or venture partner is an affiliate of the entity shown.
 
(6) These projects are owned either (1) through a joint venture with a third party providing a participation in operations and on sale of the property or (2) subject to a contract with a third party providing a participation in operations and on sale of the property, even though they may be shown as 100% owned.
 
(7) 100 North Point Center East and 200 North Point Center East were financed together as one non-recourse mortgage note payable.
 
(8) 333 North Point Center East and 555 North Point Center East were financed together as one recourse mortgage note payable.
 
(9) See “Additional Information Related to Operating Properties” following this table for more information related to 3100 Windy Hill Road.
 
(10) At Meridian Mark Plaza, 8,718 square feet of the Northside Hospital lease expires in 2008; 7,521 square feet of the Scottish Rite Hospital lease expires in 2009.
 
(11) Emory Crawford Long Medical Office Tower was developed on top of a building within the Crawford Long Hospital campus. The venture received a fee simple interest in the air rights above this building in order to develop the medical office tower.
 
(12) Presbyterian Medical Plaza at University is located on 1 acre, which is subject to a ground lease expiring in 2057.
 
(13) Approximately 23,359 square feet of the Novant Health, Inc. lease at Presbyterian Medical Plaza at University expires in 2007, with an option to renew through 2022.
 
(14) Where a tenant has the option to cancel its lease without penalty, the lease expiration date used in the Lease Expirations tables reflect the cancellation option date rather than the lease expiration date.
 
(15) Annual Contractual Rent excludes the operating expense reimbursement portion of the rent payable and percentage rents, if applicable. If the lease does not provide for pass through of such operating expense reimbursements, an estimate of operating expenses is deducted from the rental rate shown. The contractual rental rate shown is the estimated rate in the year of expiration.
 
(16) Rentable square feet leased as of December 31, 2006 out of approximately 2,828,000 total rentable square feet.
 
(17) Rentable square feet leased as of December 31, 2006 out of approximately 2,095,000 total rentable square feet.
 
(18) These retail centers also include outparcels which are ground leased to freestanding users.


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(19) A portion of the project became partially operational in 2006, but a portion remains under construction and/or in lease-up as of December 31, 2006.
 
(20) This anchor tenant owns its own store and land.
 
(21) This tenant built and owns its own store and pays the Company under a ground lease.
 
(22) During 2006, these properties were contributed to CP Venture IV Holdings LLC. Cost and cost less depreciation and amortization reflects the venture’s basis which was adjusted to fair market value at the time of the contribution.
 
(23) This loan was assumed by CP Venture IV Holdings LLC upon contribution of this property to CP Venture IV Holdings LLC and was adjusted to fair market value at the time of the contribution.
 
(24) Approximately 1.5 acres of the total acreage at The Avenue Peachtree City is under a ground lease expiring in 2024.
 
(25) The Company’s economic interest in this property decreased in 2006 as a result of Prudential satisfying in full a note payable of CP Venture Two LLC.
 
(26) This project is currently under contract to sell, and the sale is anticipated to close in the first quarter of 2007.
 
(27) Gross leasable area leased as of December 31, 2006 out of approximately 492,000 total gross leasable area.
 
(28) Gross leasable area leased as of December 31, 2006 out of approximately 2,212,000 total gross leasable area.
 
(29) This building became operational during 2006.
 


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Table of Contents

Additional Information Related to Operating Properties
 
The 3100 Windy Hill Road building, a 188,000 rentable square foot building constructed as a training facility, occupies a 13-acre parcel of land which is wholly owned by the Company. The building was sold in 1983 to a limited partnership of private investors, at which time the Company received a leasehold mortgage note. The training facility land was simultaneously leased to the partnership for thirty years, along with certain equipment for varying periods. The building was leased by the partnership to IBM through November 30, 2006.
 
Effective January 1, 1997, based on the economics of the training facility lease, the Company determined it would receive substantially all of the economic risks and rewards from the property, mainly due to the short term remaining on the land lease and the mortgage note balance that would have to be paid off, with interest, at maturity. As such, the Company began consolidating the operations of the building and eliminated the mortgage note balance and activity under the land lease beginning January 1, 1997.
 
During 2006, the Company and the partnership amended the note and ground lease to, among other things, extend both to expire on January 1, 2010.
 
This property is currently vacant and the Company is attempting to re-lease the space. There can be no guarantee as to rental rates upon re-leasing or the period to lease-up, although the Company does not believe the property has any impairment in value.
 
Projects Under Development
 
The following details the office, multi-family, retail and industrial projects under development at December 31, 2006. Dollars are stated in thousands.
 
                                                             
                Leased
                             
                GLA (%)
                             
                Total
                Cousins’
          Actual or
    Company
    Total
    Project
          Approximate
    Share of
    Cousins’
    Projected Dates for
    Owned
    Project
    (Fully
    Cousins’
    Total
    Total
    Investment
    Completion and Fully
Project(1)
  GLA(2)     GLA(3)     Executed)     Ownership%     Cost     Cost     at 12/31/06    
Operational/Sold
 
OFFICE/MULTI-FAMILY
                                                           
Terminus 100
    656,000       656,000       64 %     100 %   $ 170,400     $ 170,400     $ 113,564     const. - 2Q-07
(Atlanta, GA)
                                                          fully operational 2Q-08
191 Peachtree Tower(5)
    1,211,000       1,211,000       60 %(4)     100 %     231,500       231,500       155,070     fully stabilized - 4Q-10
(Atlanta, GA)
                                                           
Palisades West(6)
                                                           
(Austin, TX)
                                                           
Building 1
    210,000       210,000       100 %     50 %                           const. - 2Q-08
fully operational 2Q-08
Building 2
    150,000       150,000       0 %     50 %                           const. - 1Q-09
fully operational 4Q-09
                                                             
Total — Palisades West
    360,000       360,000                       77,500       38,750       12,971 (6)    
                                                             
50 Biscayne(7)
    529 units       529 units       N/A       40 %     161,500       64,600       45,130     const. - 4Q-07
(Miami, FL)
                                                          fully sold 1Q-08
                                                             
TOTAL OFFICE/MULTI-FAMILY
    2,227,000       2,227,000                       640,900       505,250       326,735      
                                                             
RETAIL
                                                           
The Avenue Carriage Crossing(8)
(Suburban Memphis, TN)
                                                           
Phase I — Expansion
    50,000       50,000       0 %     100 %                           const. - 1Q-09
fully operational 1Q-10
Phase II
    20,000       41,000       0 %     100 %                           const. - 4Q-07
fully operational 2Q-08
                                                             
Total — Avenue Carriage Crossing
    70,000       91,000                       13,900       13,900       2,804      
                                                             


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Table of Contents

                                                             
                Leased
                             
                GLA (%)
                             
                Total
                Cousins’
          Actual or
    Company
    Total
    Project
          Approximate
    Share of
    Cousins’
    Projected Dates for
    Owned
    Project
    (Fully
    Cousins’
    Total
    Total
    Investment
    Completion and Fully
Project(1)
  GLA(2)     GLA(3)     Executed)     Ownership%     Cost     Cost     at 12/31/06    
Operational/Sold
 
The Avenue Webb Gin
(Suburban Atlanta, GA)
                                                           
Phase I
    359,000       359,000       71 %     100 %   $     $     $     const. - 3Q-07
fully operational 4Q-07
Phase II
    22,000       22,000       0 %     100 %                           const. - 3Q-08
fully operational 4Q-08
                                                             
Total - Webb Gin
    381,000       381,000                       84,000       84,000       69,757     const. - 2Q-07
fully operational 2Q-07
                                                             
San Jose MarketCenter
(San Jose, CA)
    220,000       363,000       93 %     100 %     84,100       84,100       79,958      
                                                             
Avenue Murfreesboro
                                                           
(Suburban Nashville, TN)
                                                           
Phases I and II
    692,000       692,000       49 %     50 %                           const. - 4Q-07
fully operational 4Q-08
Phase III
    34,000       34,000       0 %     50 %                           const. -2Q-08
fully operational 2Q-09
Phase IV
    28,000       28,000       0 %     50 %                           const. - 4Q-09
fully operational 4Q-09
Phase V
    56,000       56,000       0 %     50 %                           const. - 1Q-10
fully operational 2Q-10
                                                             
Total - Murfreesboro
    810,000       810,000                       153,100       76,550       11,976      
                                                             
TOTAL RETAIL
    1,481,000       1,645,000                       335,100       258,550       164,495      
                                                             
INDUSTRIAL
                                                           
King Mill Distribution Park
(Suburban Atlanta, GA)
Building 3 B
    379,000       379,000       0 %     75 %     11,000       8,250       7,148     const. - 4Q-06
fully operational 2Q-07
Jefferson Mill Distribution Center
(Suburban Atlanta, GA) Building A
    459,000       459,000       0 %     75 %     14,900       11,175       6,197     const. - 1Q-07
fully operational 4Q-07
Lakeside Ranch Business Park
(Dallas, TX)
Building 20
    749,000       749,000       47 %     96.5 %     26,400       25,476       17,766     const. - 2Q-07
fully operational 3Q-07
                                                             
TOTAL INDUSTRIAL
    1,587,000       1,587,000                       52,300       44,901       31,111      
                                                             
Accumulated Depreciation on Partially Operational Properties
                                            (1,904 )    
                                                             
TOTAL PORTFOLIO
    5,295,000       5,459,000                     $ 1,028,300     $ 808,701     $ 520,437 (9)    
                                                             
 
(Notes to Development Table)
 
 
(1) This schedule includes all Office/Multi-Family, Retail and Industrial projects under construction or redevelopment from the commencement of construction or redevelopment until the projects become fully operational pursuant to accounting principles generally accepted in the United States. Single-family residential projects are included on a separate schedule in this report. Amounts included in the total cost column represent the estimated costs upon completion of the project and achievement of fully operational status. Significant estimation is required to derive these costs and the final costs may differ from these estimates. The projected dates for completion and fully operational status shown above are estimates and are subject to change as the projects proceed through the development process.
 
(2) Company Owned Gross Leasable Area (“GLA”) includes square footage owned either directly by the Company or by a joint venture in which the Company is a partner.

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(3) Total Project GLA includes anchor stores who may own their own property and other non-owned property contained within the named development.
 
(4) Leased square footage includes a lease with the Company of 62,000 square feet.
 
(5) 191 Peachtree Tower was purchased in 2006 and is under redevelopment and repositioning. It is treated as a development property for the purpose of this schedule, although its cost basis is included in operating properties on the Company’s consolidated balance sheet.
 
(6) The Company is obligated to fund 50% of the project costs for the Palisades West Joint Venture. The Company made the majority of its initial equity contribution in the form of land; therefore, the Company’s investment in this project at 12/31/06 is more than 50% of the costs spent to date.
 
(7) 95% of the units at 50 Biscayne are under non-cancelable third party contracts, 3% of the units are under cancelable contracts, and the remaining 2% of the units are under non-cancelable contracts to the Company’s partner in the venture.
 
(8) A third party will share in the results of operations and any gain on sale of the property.
 
(9) Reconciliation to Consolidated Balance Sheet
 
         
Total Cousins’ Investment per above schedule
  $ 520,437  
Less: Operating Property under redevelopment/repositioning
    (155,070 )
Less: Investment in unconsolidated joint ventures
       
50 Biscayne
    (45,130 )
Palisades West
    (12,971 )
Avenue Murfreesboro
    (11,976 )
Add: Weeks 25% interest in King Mill Distribution Park — Bldg 3 B
    2,383  
Add: Weeks 25% interest in Jefferson Mill Distribution Center Bldg A
    2,066  
Add: Weeks 3.5% interest in Lakeside Ranch — Bldg 20
    643  
         
Consolidated projects under development per balance sheet
  $ 300,382  
         
 
Residential Projects Under Development
 
As of December 31, 2006, CREC, Temco Associates (“Temco”) and CL Realty, L.L.C. (“CL Realty”) owned the following parcels of land which are being developed into residential communities. Information in the table represents total amounts for the development as a whole, not the Company’s share. Dollars are stated in thousands.
 
                                                                         
          Estimated
    Estimated
    Developed
    Lots Sold
    Lots Sold
    Total
    Remaining
       
    Year
    Project Life
    Total Lots to
    Lots in
    in Current
    Year to
    Lots
    Lots to be
    Cost
 
Description
  Commenced     (In Years)     be Developed(1)     Inventory     Quarter     Date     Sold     Sold     Basis(2)  
 
Cousins Real Estate Corporation (Consolidated)
                                                                       
The Lakes at Cedar Grove(3)
    2001       11       906       8       18       107       675       231     $ 5,468  
Fulton County
                                                                       
Suburban Atlanta, GA
                                                                       
Callaway Gardens(4)
    2006       6       567                               567       1,584  
Harris County
                                                                       
Pine Mountain, GA
                                                                       
Blalock Lakes
    2006       9       399                               399       17,657  
Coweta County
                                                                       
Newnan, GA
                                                                       
Longleaf at Callaway(5)
    2002       5       138       21       2       9       117       21       2,088  
Harris County
                                                                       
Pine Mountain, GA
                                                                       
River’s Call
    1999       10       107       16       2       10       91       16       827  
East Cobb County
                                                                       
Suburban Atlanta, GA
                                                                       
                                                                         
Total Consolidated
                    2,117       45       22       126       883       1,234       27,624  
                                                                         


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          Estimated
    Estimated
    Developed
    Lots Sold
    Lots Sold
    Total
    Remaining
       
    Year
    Project Life
    Total Lots to
    Lots in
    in Current
    Year to
    Lots
    Lots to be
    Cost
 
Description
  Commenced     (In Years)     be Developed(1)     Inventory     Quarter     Date     Sold     Sold     Basis(2)  
 
Temco (50% owned)(6)
                                                                       
Bentwater
    1998       9       1,676       7       107       139       1,669       7     $ 649  
Paulding County
                                                                       
Suburban Atlanta, GA
                                                                       
The Georgian (75% owned)
    2003       10       1,386       266       4       29       282       1,104       20,953  
Paulding County
                                                                       
Suburban Atlanta, GA
                                                                       
Seven Hills
    2003       7       1,077       101       51       197       561       516       14,039  
Paulding County
                                                                       
Suburban Atlanta, GA
                                                                       
Happy Valley
    2004       2       110                   110       110              
Paulding County
                                                                       
Suburban Atlanta, GA
                                                                       
Harris Place
    2004       4       27       11       1       2       16       11       772  
Paulding County
                                                                       
Suburban Atlanta, GA
                                                                       
                                                                         
Total Temco
                    4,276       385       163       477       2,638       1,638       36,413  
                                                                         
CL Realty (50% owned)(6)
                                                                       
Long Meadow Farms (37.5% owned)
    2003       10       2,712       132       114       231       518       2,194       23,149  
Fort Bend County
                                                                       
Houston, TX
                                                                       
Summer Creek Ranch
    2003       9       2,488       90       8       117       780       1,708       21,860  
Tarrant County
                                                                       
Fort Worth, TX
                                                                       
Bar C Ranch
    2004       8       1,181       34       23       104       143       1,038       8,316  
Tarrant County
                                                                       
Forth Worth, TX
                                                                       
Summer Lakes
    2003       5       1,144       19                   294       850       4,531  
Fort Bend County
                                                                       
Rosenberg, TX
                                                                       

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          Estimated
    Estimated
    Developed
    Lots Sold
    Lots Sold
    Total
    Remaining
       
    Year
    Project Life
    Total Lots to
    Lots in
    in Current
    Year to
    Lots
    Lots to be
    Cost
 
Description
  Commenced     (In Years)     be Developed(1)     Inventory     Quarter     Date     Sold     Sold     Basis(2)  
 
CL Realty continued
                                                                       
Southern Trails (80% owned)
    2005       6       1,059       42       19       82       181       878     $ 12,082  
Brazoria County
                                                                       
Pearland, TX
                                                                       
Village Park(7)
    2003       5       569       45       26       126       311       258       7,821  
Collin County
                                                                       
McKinney, TX
                                                                       
Waterford Park
    2005       3       493                               493       6,272  
Fort Bend County
                                                                       
Rosenberg, TX
                                                                       
Stonewall Estates (50% owned)
    2005       5       390       97       30       30       30       360       6,332  
Bexar County
                                                                       
San Antonio, TX
                                                                       
Manatee River Plantation
    2003       5       457       109       24       81       348       109       3,796  
Manatee County
                                                                       
Tampa, FL
                                                                       
Stillwater Canyon
    2003       5       336       30       17       64       201       135       2,279  
Dallas County
                                                                       
DeSota, TX
                                                                       
Creekside Oaks
    2003       5       301       176                   125       176       5,320  
Manatee County
                                                                       
Bradenton, FL
                                                                       
Blue Valley (25% owned)
    2005       3       197       4             24       24       173       26,395  
Cherokee & Fulton Counties
                                                                       
Alpharetta, GA
                                                                       
Village Park North(7)
    2005       5       194       53       8       25       25       169       3,380  
Collin County
                                                                       
McKinney, TX
                                                                       
Bridle Path Estates
    2004       7       87                               87       4,205  
Hillsborough County
                                                                       
Tampa, FL
                                                                       
West Park
    2005       3       82                   21       21       61       4,533  
Cobb County
                                                                       
Suburban Atlanta, GA
                                                                       
Stonebridge(8)
    2003       4       360                   68       360              
Coweta County
                                                                       
Newnan, GA
                                                                       
                                                                         
Total CL Realty
                    12,050       831       269       973       3,361       8,689       140,271  
                                                                         
Total
                    18,443       1,261       454       1,576       6,882       11,561     $ 204,308  
                                                                         
Company Share of Total
                    8,820       549       192       708       3,440       5,331     $ 93,423  
                                                                         
Company Weighted Average Ownership
                    48 %     44 %     42 %     45 %     50 %     46 %     46 %
                                                                         
 
 
(1) This estimate represents the total projected development capacity for a development on both owned land and land expected to be purchased for further development. The numbers shown include lots currently developed or to be developed over time, based on management’s current estimates, and lots sold to date from inception of development.
 
(2) Includes cost basis of land tracts as detailed on the Land Held for Investment or Future Development schedule.
 
(3) A third party has a participation in this project after certain thresholds are met.
 
(4) Callaway Gardens is owned in a venture, although the venture is consolidated with the Company. The partner is entitled to a share of the profits after the Company’s capital is recovered.
 
(5) Longleaf at Callaway lots are sold to a home building venture, of which CREC is a joint venture partner. As a result of this relationship, the Company recognizes profits when houses are built and sold, rather than at the

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time lots are sold, as is the case with the Company’s other residential developments. As of December 31, 2006, 108 houses have been sold.
 
(6) CREC owns 50% of Temco Associates and CL Realty.
 
(7) CL Realty purchased the partner’s interest in Village Park and Village Park North on July 31, 2006. Prior to this date, CL owned 60% and 75%, respectively, of the projects.
 
(8) CL Realty owned a 10% interest in Stonebridge, which it sold on July 18, 2006.
 
Land Held for Investment or Future Development
 
As of December 31, 2006, the Company owned or controlled the following land holdings either directly or indirectly through venture arrangements. The Company evaluates its land holdings on a regular basis and may develop, ground lease or sell portions of the land holdings if opportunities arise. Information in the table represents total amounts for the developable land area as a whole, not the Company’s share, and for cost basis, reflects the venture’s basis, if applicable. See Note 6 of Notes to Consolidated Financial Statements in Item 8 of this report for further information related to investments in unconsolidated joint ventures. Dollars are stated in thousands.
 
                                     
        Company’s
    Developable
             
        Ownership
    Land Area
    Year
    Cost
 
Description and Location(1)
 
Zoned Use
  Interest     (Acres)     Acquired     Basis(2)  
 
North Point
                                   
Suburban Atlanta, GA
  Mixed Use     100 %     67       1970-1985     $ 5,200  
Wildwood Office Park
                                   
Suburban Atlanta, GA
  Office and Commercial     100 %     27       1971-1989       883  
King Mill Distribution Park(3)
                                   
Suburban Atlanta, GA
  Industrial     100 %     140       2005       12,035  
Land Adjacent to The Avenue Carriage Crossing(4)
                                   
Memphis, TN
  Retail and Commercial     100 %     41       2004       4,899  
Round Rock/Austin, Texas Land
                                   
Austin, TX
  Retail and Commercial     100 %     45       2005       17,085  
The Lakes at Cedar Grove(5)
                                   
Suburban Atlanta, GA
  Mixed Use     100 %     10       2002        (6)
Terminus
                                   
Atlanta, GA
  Mixed Use     100 %     6       2005       24,565  
505, 511, 555 & 557 Peachtree Street
                                   
Atlanta, GA
  Mixed Use     100 %     1       2004-2006       6,253  
615 Peachtree Street(7)
                                   
Atlanta, GA
  Mixed Use     100 %     2       1996       10,044  
Jefferson Mill Business Park(3)
                                   
Suburban Atlanta, GA
  Industrial and Commercial     100 %     277       2006       14,027  
Lakeside Ranch Business Park(8)
                                   
Dallas, TX
  Industrial and Commercial     96.5 %     48       2006       6,399  
                                     
TOTAL CONSOLIDATED LAND HELD FOR INVESTMENT OR FUTURE DEVELOPMENT
                              $ 101,390  
                                     
TEMCO TRACTS(6)
                                   
Seven Hills
                                   
Suburban Atlanta, GA
  Residential and Mixed Use     50 %     85       2002-2005     $  (6)
Happy Valley
                                   
Suburban Atlanta, GA
  Residential     50 %     213       2003       2,135  
Paulding County
                                   
Suburban Atlanta, GA
  Residential and Mixed Use     50 %     6,384       2005       14,519  
CL REALTY TRACTS
                                   
Summer Creek Ranch
                                   
Forth Worth, TX
  Residential and Mixed Use     50 %     374       2002     $  (6)
Long Meadow Farms
                                   
Houston, TX
  Residential and Mixed Use     19 %     114       2002        (6)
Waterford Park
                                   
Rosenberg, TX
  Commercial     50 %     37       2005        (6)
Summer Lakes
                                   
Rosenberg, TX
  Commercial     50 %     9       2003        (6)
Village Park
                                   
McKinney, TX
  Residential     50 %     5       2003-2005        (6)
Padre Island
                                   
Corpus Christi, TX
  Residential and Mixed Use     50 %     15       2005       11,539  


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        Company’s
    Developable
             
        Ownership
    Land Area
    Year
    Cost
 
Description and Location(1)
 
Zoned Use
  Interest     (Acres)     Acquired     Basis(2)  
 
OTHER JOINT VENTURES
                                   
Handy Road Associates, LLC
                                   
Suburban Atlanta, GA
  Large Lot Residential     50 %     1,187       2004     $ 5,251  
Wildwood Office Park
                                   
Suburban Atlanta, GA
  Office and Commercial     50 %     32       1971-1989       21,875  
Austin Research Park
                                   
Austin, TX
  Commercial     50 %     6       1998       3,478  
                                     
Total Acres
                9,125                  
                                     
 
 
(1) The following properties include adjacent building pads. The aggregate cost of these pads is included in Operating Properties in the Company’s consolidated financial statements or the applicable joint venture’s financial statements. The square footage of potential office buildings which could be built on the land is as follows:
 
                 
    Ownership
    Square
 
   
Interest
    Footage  
 
Ten Peachtree Place
    50.0 %     400,000  
One Georgia Center
    88.5 %     300,000  
The Points at Waterview
    100.0 %     60,000  
 
(2) For consolidated properties, amount reflects the Company’s basis. For joint venture properties, amount reflects the venture’s basis.
 
(3) Weeks Properties Group, LLC has the option to invest up to 25% of project equity of any future industrial development on a portion of this land.
 
(4) This land was sold subsequent to December 31, 2006.
 
(5) This project is consolidated but a third party has a participation in the results of operations of this project.
 
(6) Residential communities with adjacent land that is intended to be sold to third parties in large tracts for residential, multi-family or commercial development. The basis of these tracts as well as lot inventory are included on the Residential Projects Under Development schedule.
 
(7) This property included a building and parking deck that were imploded in the third quarter of 2006. The cost basis includes costs associated with the demolition and clearing of the land for a future development.
 
(8) This project is owned through a joint venture with a third party who has contributed equity but the equity ownership and the allocation of the results of operations and/or gain on sale may be disproportionate to the equity ownership.
 
  Other Investments
 
Air Rights Near the CNN Center.  The Company owns a leasehold interest in the air rights over the approximately 365,000 square foot CNN Center parking facility in Atlanta, Georgia, adjoining the headquarters of Turner Broadcasting System, Inc. and Cable News Network. The air rights are developable for additional parking or office use. The Company’s net carrying value of this interest is $0.
 
Item 3.  Legal Proceedings
 
The Company is subject to various legal proceedings, claims and administrative proceedings arising in the ordinary course of business, some of which are expected to be covered by liability insurance and all of which collectively are not expected to have a material adverse effect on the liquidity, results of operations, business or financial condition of the Company.

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Item 4.  Submission of Matters to a Vote of Security Holders
 
No matter was submitted for a vote of the security holders during the fourth quarter of the Registrant’s fiscal year ended December 31, 2006.
 
Item X.  Executive Officers of the Registrant
 
The Executive Officers of the Registrant as of the date hereof are as follows:
 
             
Name
 
Age
 
Office Held
 
Thomas D. Bell, Jr. 
  57   President, Chief Executive Officer and
Chairman of the Board of Directors
Daniel M. DuPree
  60   Vice Chairman of the Company
R. Dary Stone
  53   Vice Chairman of the Company
James A. Fleming
  48   Executive Vice President and Chief Financial Officer
Craig B. Jones
  55   Executive Vice President and Chief Investment Officer
Lawrence L. Gellerstedt III
  50   Senior Vice President and President of the Office/Multi-Family Division
John D. Harris, Jr. 
  47   Senior Vice President, Chief Accounting Officer and Assistant Secretary
Robert M. Jackson
  39   Senior Vice President, General Counsel and Corporate Secretary
John S. McColl
  44   Senior Vice President — Office/Multi-Family Division
Joel T. Murphy
  48   Senior Vice President and President of the Retail Division
Forrest W. Robinson
  55   Senior Vice President and President of the Industrial Division
Bruce E. Smith
  59   Senior Vice President and President of the Land Division
 
Family Relationships:
 
Thomas G. Cousins was the Chairman of the Board of Directors from January 1, 2006 until December 7, 2006, when he retired. Lillian C. Giornelli, Mr. Cousins’ daughter, is a director of the Company. There are no other family relationships among the Executive Officers or Directors.
 
Term of Office:
 
The term of office for all officers expires at the annual stockholders’ meeting. The Board retains the power to remove any officer at any time.
 
Business Experience:
 
Mr. Bell has served as the President and Chief Executive Officer of the Company since January 2002. He has also served as Chairman of the Executive Committee and Chairman of the Board since June 2000 and December 2006, respectively. Prior to becoming Chairman of the Board in December 2006, he served as Vice Chairman of the Board beginning in June 2000. He was a Special Limited Partner with Forstmann Little & Co. from January 2001 until January 2002. He was Worldwide Chairman and Chief Executive Officer of Young & Rubicam, Inc. from January 2000 to November 2000; President and Chief Operating Officer of Young & Rubicam, Inc. from August 1999 to December 1999; and Chairman and Chief Executive Officer of Young & Rubicam Advertising from September 1998 to August 1999. Mr. Bell is also a director of Regal Entertainment Group, AGL Resources, Inc., and the United States Chamber of Commerce and a Trustee of Emory University Healthcare.


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Mr. DuPree rejoined the Company in March 2003 as Vice Chairman of the Company. During his previous tenure with the Company from October 1992 until March 2001, he became Senior Vice President in April 1993, Senior Executive Vice President in April 1995 and President and Chief Operating Officer in November 1995. From September 2002 until February 2003, Mr. DuPree was Chief Executive Officer of Barry Real Estate Companies, a privately held development firm.
 
Mr. Stone joined the Company in June 1999 as President of Cousins Stone LP, a venture in which the Company purchased a 50% interest in June 1999. In July 2000, the Company purchased an additional 25% interest in Cousins Stone LP and in February 2001, the Company purchased the remaining 25% interest. The name Cousins Stone LP was changed to Cousins Properties Services LP in August 2001. Mr. Stone was President and Chief Operating Officer of the Company from February 2001 to January 2002 and was a Director of the Company from 2001 to 2003. Effective January 2002, he relinquished the positions of President and Chief Operating Officer and assumed the position of President — Texas. In February 2003, he became Vice Chairman of the Company.
 
Mr. Fleming joined the Company in July 2001 as Senior Vice President, General Counsel and Secretary. He became Executive Vice President and Chief Financial Officer in August 2004. He was a partner in the Atlanta law firm of Fleming & Ray from October 1994 until July 2001. Prior to that he was a partner at Long Aldridge & Norman, where he served as Managing Partner from 1991 through 1993.
 
Mr. Jones joined the Company in October 1992 and became Senior Vice President in November 1995 and President of the Office Division in September 1998. He became Executive Vice President and Chief Administrative Officer in August 2004 and served in that capacity until December 2006 when he assumed the role of Executive Vice President and Chief Investment Officer. From 1987 until joining the Company, he was Executive Vice President of New Market Companies, Inc. and affiliates.
 
Mr. Gellerstedt joined the Company in July 2005 as Senior Vice President and President of the Office/Multi-Family Division. From 2003 to 2005, Mr. Gellerstedt was Chairman and CEO of The Gellerstedt Group. From 2001 to 2003, he was President and COO of The Integral Group, LLC.
 
Mr. Harris joined the Company in February 2005 as Senior Vice President and Chief Accounting Officer. From 1994 to 2003, Mr. Harris was employed by JDN Realty Corporation, most recently serving as Senior Vice President, Chief Financial Officer, Secretary, and Treasurer. Beginning in 2004, Mr. Harris was the Vice President and Corporate Controller for Wells Real Estate Funds, Inc. Prior to 1994, Mr. Harris was employed by Ernst & Young LLP, most recently serving as Senior Manager.
 
Mr. Jackson joined the Company in December 2004 as Senior Vice President, General Counsel and Corporate Secretary. From February 1996 to December 2004, he was an associate and then a partner with the Atlanta-based law firm of Troutman Sanders LLP.
 
Mr. McColl joined the Company in April 1996 as Vice President. He joined the Cousins/Richmond Division in February 1997 and was promoted in May 1997 to Senior Vice President. He joined the Office Division in September 2000.
 
Mr. Murphy joined the Company in October 1992 and became Senior Vice President of the Company and President of the Retail Division in November 1995. From 1990 until joining the Company, he was Senior Vice President of New Market Companies, Inc. and affiliates.
 
Mr. Robinson joined the Company in May 2004 as Senior Vice President and President of the Industrial Division. Prior to joining the Company, he was Senior Vice President and President of Codina Group from March 2001 to April 2004. From 1999 to 2001, he was Senior Vice President of Duke Realty Company.
 
Mr. Smith joined the Company in May 1993 as Senior Vice President and President of the Land Division. From 1983 until joining the Company, he held several positions with Arvida Company, including President of the Atlanta Division and President of the Texas Division.


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PART II
 
Item 5.   Market for Registrant’s Common Stock and Related Stockholder Matters
 
Market Information
 
The high and low sales prices for the Company’s common stock and cash dividends declared per common share were as follows:
 
                                                                 
    2006 Quarters     2005 Quarters  
    First     Second     Third     Fourth     First     Second     Third     Fourth  
 
High
  $ 33.99     $ 33.49     $ 34.89     $ 38.77     $ 31.24     $ 30.15     $ 33.50     $ 30.75  
Low
    27.87       29.02       29.64       33.13       25.28       25.36       27.70       27.04  
Dividends Declared:
                                                               
Regular
    .37       .37       .37       .37       .37       .37       .37       .37  
Special
                      3.40                          
Payment Date:
                                                               
Regular
    2/22/06       5/30/06       8/25/06       12/22/06       2/22/05       5/27/05       8/25/05       12/22/05  
Special
                      12/01/06                          
 
Holders
 
The Company’s common stock trades on the New York Stock Exchange (ticker symbol CUZ). At February 23, 2007, there were 1,166 common stockholders of record.
 
Purchases of Equity Securities
 
The following table contains information about the Company’s purchases of its equity securities during the fourth quarter of 2006:
 
                                   
    Purchases Outside Plan       Purchases Inside Plan  
   
 
                  Total Number of
    Maximum Number of
 
    Total Number
            Shares Purchased as
    Shares That May Yet
 
    of Shares
    Average Price
      Part of Publicly
    Be Purchased Under
 
    Purchased(1)     Paid per Share(1)       Announced Plan(2)     Plan(2)  
October 1-31
    5,122     $ 35.76               5,000,000  
November 1-30
    66,664       35.75               5,000,000  
December 1-31
    45,890       36.02               5,000,000  
                                   
Total
    117,676     $ 35.86               5,000,000  
                                   
 
                                 
 
 
(1) The purchases of equity securities that occurred during the fourth quarter of 2006 related to shares remitted by employees as payment for income taxes due in conjunction with restricted stock grants or option exercises or as payment for option exercises.
 
(2) On May 9, 2006, the Board of Directors of the Company authorized a stock repurchase plan, which expires May 9, 2009, of up to 5,000,000 shares of the Company’s common stock. No purchases were made under this plan in the fourth quarter of 2006.


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Table of Contents

 
Performance Graph
 
The following graph compares the five-year cumulative total return of Cousins Properties Incorporated Common Stock with the Hemscott Group Index, NYSE Market Index, S&P 500 Index and NAREIT Equity REIT Index. The Hemscott Group Index, formerly the CoreData Group Index, is published by Hemscott PLC and is comprised of publicly-held REITs. The graph assumes a $100 investment in each of the indices on December 31, 2001 and the reinvestment of all dividends.
 
LINE GRAPH
 
COMPARISON OF CUMULATIVE TOTAL RETURN OF ONE OR MORE
COMPANIES, PEER GROUPS, INDUSTRY INDICES AND/OR BROAD MARKETS
 
                                                 
    Fiscal Year Ended
Company/Index/Market   12/31/2001   12/31/2002   12/31/2003   12/31/2004   12/31/2005   12/31/2006
Cousins Properties Incorporated
    100.00       107.67       151.41       195.25       192.35       274.99  
Hemscott Group Index
    100.00       97.13       127.21       169.08       179.02       234.85  
S&P Composite
    100.00       77.90       100.25       111.15       116.61       135.03  
NYSE Market Index
    100.00       81.69       105.82