During the three and six months ended June 30, 2009 and 2008, as compared to the three and six months ended June 30, 2008, property operating income increased by 1.6% and 3.6%, respectively. Declines in conventional same store property operating income of 3.9% and 2.2% for the three and six months ended June 30, 2009, were more than offset by increases in property operating income related to our conventional redevelopment properties and affordable properties. In addition to focusing on property operating expense control, we have also been successful at reducing corporate general and administrative expenses. During the three and six months ended June 30, 2009, general and administrative expenses have been reduced by 34% and 22%, respectively, from the 2008 comparative periods. Due to turmoil in capital markets, Aimco has focused on reducing refunding risk by accelerating refinancing of property loans maturing prior to 2012. At the beginning of the second quarter 2009, property debt maturing during 2009 through 2011 was $621.5 million. During the second quarter, through refinancing, repayment and property sales, Aimco reduced these maturities by $312.5 million. As of June 30, 2009, the balance of property debt maturing through 2011 totaled $309.0 million and was related to 20 loans. Of these loans, refunding risk is expected to be eliminated by the end of the third quarter 2009 with respect to all but five loans. The five remaining property loans total $234.5 million and are expected to be refinanced at maturity in 2011.
Our portfolio management strategy includes property dispositions and acquisitions aimed at concentrating our portfolio in our target markets, which are the largest 20 U.S. markets as measured by the total market value of institutional-grade apartment properties in a particular market (total market capitalization). We continue to increase our allocation of capital to well located properties within our target markets and are currently marketing for sale approximately $2.0 billion of conventional and affordable assets located primarily outside these target markets. During the six months ended June 30, 2009, we sold 30 properties (including one unconsolidated property), primarily outside these target markets, for gross proceeds of $374.4 million; proceeds net of transaction related costs and debt repayments were $125.2 million. We expect the financial and economic conditions for the remainder of 2009 to continue to be very difficult and we will continue to evaluate our activities and organizational structure, and intend to adjust as necessary. The following discussion and analysis of the results of our operations and financial condition should be read in conjunction with the accompanying condensed consolidated financial statements in Item 1. Results of Operations
Overview
Three and six months ended June 30, 2009 compared to June 30, 2008 We reported net loss attributable to Aimco of $18.4 million and net loss attributable to Aimco common stockholders of $29.9 million for the three months ended June 30, 2009, compared to net income attributable to Aimco of $256.0 million and net income attributable to Aimco common stockholders of $239.1 million for the three months ended June 30, 2008, decreases of $274.4 million and $269.0 million, respectively.
For the six months ended June 30, 2009, we reported net loss attributable to Aimco of $43.0 million and net loss attributable to Aimco common stockholders of $67.6 million, compared to net income attributable to Aimco of $231.3 million and net income attributable to Aimco common stockholders of $200.9 million for the six months ended June 30, 2008, decreases of $274.3 million and $268.5 million, respectively.
These decreases were principally due to the following items, all of which are discussed in further detail below:
• a decrease in income from discontinued operations, primarily related to the volume of sales in 2008 and the related number of properties included in discontinued operations in 2008 as compared to 2009;

• a decrease in asset management and tax credit revenues, primarily due to a reduction in promote income, which is income earned in connection with the disposition of properties owned by our consolidated joint ventures; and

• an increase in depreciation and amortization expense, primarily related to completed redevelopments and capital expenditures.

The effects of these items on our operating results were partially offset by:
• a decrease in earnings allocable to noncontrolling interests, primarily due to a decrease in gains on sales in 2009 as compared to 2008;

• a decrease in general and administrative expenses, primarily related to reductions in personnel and related expenses from our organizational restructuring initiated during the fourth quarter 2008; and

• an increase in net operating income associated with property operations, primarily related to affordable properties and completed redevelopments.

The following paragraphs discuss these and other items affecting the results of our operations in more detail.
Business Segment Operating Results
We have two reportable segments: real estate (owning, operating and redeveloping apartments) and investment management (portfolio strategy, capital allocation, joint ventures, tax credit syndication, acquisitions, dispositions and other transaction activities). Our chief operating decision maker, as defined in FASB Statement of Financial Accounting Standards No. 131, Disclosures About Segments of an Enterprise and Related Information, uses various generally accepted industry financial measures to assess the performance and financial condition of the business, including: NAV; FFO; AFFO; same store property operating results; net operating income; Free Cash Flow; Economic Income; financial coverage ratios; and leverage as shown on our balance sheet. Our chief operating decision maker emphasizes net operating income as a key measurement of segment profit or loss. Segment net operating income is generally defined as segment revenues less direct segment operating expenses.
Real Estate Segment
Our real estate segment involves the ownership and operation of properties that generate rental and other property-related income through the leasing of apartment units. Our real estate segment's net operating income also includes income from property management services performed for unconsolidated partnerships and unrelated parties.
The following table summarizes our real estate segment's net operating income for the three and six months ended June 30, 2009 and 2008 (in thousands):

                                          Three Months Ended             Six Months Ended
                                               June 30,                      June 30,
                                         2009           2008           2009           2008
Real estate segment revenues:
Rental and other property revenues     $ 320,852      $ 316,970      $ 643,010      $ 633,727
Property management revenues,
primarily from affiliates                  1,340          1,415          2,983          3,519

                                         322,192        318,385        645,993        637,246

Real estate segment expenses:
Property operating expenses              142,914        141,213        292,108        294,945
Property management expenses                 472          1,254          1,905          2,589

                                         143,386        142,467        294,013        297,534


Real estate segment net operating
income                                 $ 178,806      $ 175,918      $ 351,980      $ 339,712

For the three months ended June 30, 2009, compared to the three months ended June 30, 2008, real estate segment net operating income increased $2.9 million, or 1.6%. This increase was due to an increase in real estate segment revenues of $3.8 million, or 1.2%, offset by an increase in real estate segment expenses of $0.9 million, or 0.6%.
The increase in revenues from our real estate segment during the three months ended June 30, 2009, was primarily attributed to our conventional redevelopment and affordable properties. Revenues related to our conventional redevelopment properties increased by $4.4 million based on more units in service at these properties in 2009, and revenue related to our affordable properties increased $3.6 million, primarily due to higher average physical occupancy and rents during 2009. Revenues related to properties acquired subsequent to June 30, 2008 also resulted in a $1.3 million increase in revenues during 2009. These increases were partially offset by a $5.4 million, or 2.6%, decrease in revenues from our conventional same store properties, due to a decrease of 2.1% in average physical occupancy and lower average rent ($13 per unit).

Real estate segment expenses increased by approximately $0.9 million, or 0.6%, in the three months ended June 30, 2009. Casualty losses increased by $2.0 million during the three months ended June 30, 2009, as compared to the three months ended June 30, 2008, primarily due to an increase in losses incurred by our consolidated properties. Expenses related to our conventional redevelopment properties increased by $0.9 million due to more units in service at these properties in 2009. These increases were partially offset by a $1.1 million decrease in property management expenses related to consolidated properties and a $0.8 million decrease in property management expense related to our unconsolidated properties, both due primarily to reductions in personnel and related costs resulting from our organization restructuring (see Note 4 in our condensed consolidated financial statements in Item 1), and a $0.3 million decrease in expenses related to our conventional same store properties. For the six months ended June 30, 2009, compared to the six months ended June 30, 2008, real estate segment net operating income increased $12.3 million, or 3.6%. This increase was due to an increase in real estate segment revenues of $8.8 million, or 1.4%, and a decrease in real estate segment expenses of $3.5 million, or 1.2%.
The increase in revenues from our real estate segment during the six months ended June 30, 2009, was primarily attributed to our conventional redevelopment and affordable properties. Revenues related to our conventional redevelopment properties increased by $9.2 million based on more units in service at these properties in 2009, and revenue related to our affordable properties increased $5.8 million, primarily due to higher average physical occupancy and rents during 2009. Revenues related to properties acquired subsequent to June 30, 2008 also resulted in a $2.4 million increase in revenues during 2009. These increases were partially offset by a $7.2 million, or 1.7%, decrease in revenues from our conventional same store properties, due to a decrease of 1.6% in average physical occupancy and lower average rent ($6 per unit).
Real estate segment expenses decreased by approximately $3.5 million, or 1.2%, in the six months ended June 30, 2009. Expenses related to our property management activities, related to consolidated and unconsolidated properties, decreased by $2.9 million, due primarily to reductions in personnel and related costs resulting from our organization restructuring (see Note 4 in our condensed consolidated financial statements in Item 1). Casualty losses decreased by $1.8 million during the six months ended June 30, 2009, as compared to the six months ended June 30, 2008, primarily due to a decrease in losses incurred by our consolidated properties during these periods. Expenses related to our conventional same store properties also decreased by $1.7 million, primarily due to decreases in marketing expense, contract services and leasing commissions, partially offset by an increase in property insurance. These decreases were partially offset by a $2.2 million increase in expenses related to our conventional redevelopment properties due to more units in service at these properties in 2009, and increases of $0.5 million and $0.4 million related to properties acquired subsequent to June 30, 2008 and affordable properties, respectively.
Investment Management Segment
Our investment management segment includes activities and services related to our owned portfolio of properties as well as services provided to affiliated partnerships. Activities and services that fall within investment management include portfolio strategy, capital allocation, joint ventures, tax credit syndication, acquisitions, dispositions and other transaction activities. Within our owned portfolio, we refer to these activities as "Portfolio Management," and their benefit is seen in property operating results and in investment gains. For affiliated partnerships, we refer to these activities as "Asset Management," for which we are separately compensated through fees paid by third party investors. The expenses of this segment consist primarily of the costs of departments that perform these activities. These activities are conducted in part by our taxable subsidiaries, and the related net operating income may be subject to income taxes.
Transactions occur on varying timetables; thus, the income varies from period to period. We have affiliated real estate partnerships for which we have identified a pipeline of transactional opportunities. As a result, we view asset management fees as a predictable part of our core business strategy. Asset management revenue includes certain fees that were earned in a prior period, but not recognized at that time because collectibility was not reasonably assured. Those fees may be recognized in a subsequent period upon occurrence of a transaction or a high level of the probability of occurrence of a transaction within 12 months, or improvement in operations that generates sufficient cash to pay the fees.

The following table summarizes the net operating income from our investment management segment for the three and six months ended June 30, 2009 and 2008 (in thousands):

                                          Three Months Ended,              Six Months Ended
                                                June 30,                       June 30,
                                          2009            2008           2009           2008
Asset management and tax credit
revenues                               $    13,091      $  38,175      $  23,029      $  51,027
Investment management expenses               4,716          5,807          8,506         10,194

Investment segment net operating
income (1)                             $     8,375      $  32,368      $  14,523      $  40,833

(1) Excludes certain items of income and expense, which are included in our consolidated statements of income in:
other
expenses, net;
interest
income;
interest
expense; gain
on
dispositions
of
unconsolidated
real estate
and other;
income tax
benefit;
income from
discontinued
operations,
and
noncontrolling
interests in
consolidated
real estate
partnerships.

For the three months ended June 30, 2009, compared to the three months ended June 30, 2008, net operating income from investment management decreased $24.0 million. This decrease is primarily attributable to a $25.9 million decrease in promote income, which is income earned in connection with the disposition of properties owned by our consolidated joint ventures, partially offset by a $1.1 million decrease in investment management expenses. For the six months ended June 30, 2009, compared to the six months ended June 30, 2008, net operating income from investment management decreased $26.3 million. This decrease is primarily attributable to a $30.1 million decrease in promote income, partially offset by a $0.8 million increase in revenues associated with our affordable housing tax credit syndication business, including syndication fees and other revenue earned in connection with these arrangements, and a $1.7 million decrease in investment management expenses. Other Operating Expenses (Income)
Depreciation and Amortization
For the three months ended June 30, 2009, compared to the three months ended June 30, 2008, depreciation and amortization increased $16.6 million, or 15.7%. This increase primarily relates to depreciation for properties acquired subsequent to June 30, 2008, completed redevelopments and other capital projects recently placed in service.
For the six months ended June 30, 2009, compared to the six months ended June 30, 2008, depreciation and amortization increased $36.3 million, or 17.7%. This increase primarily relates to depreciation for properties acquired subsequent to June 30, 2008, completed redevelopments and other capital projects recently placed in service.
Provision for Operating Real Estate Impairment Losses Real estate and other long-lived assets to be held and used are stated at cost, less accumulated depreciation and amortization, unless the carrying amount of the asset is not recoverable. If events or circumstances indicate that the carrying amount of a property may not be recoverable, we make an assessment of its recoverability by comparing the carrying amount to our estimate of the undiscounted future cash flows, excluding interest charges, of the property. If the carrying amount exceeds the estimated aggregate undiscounted future cash flows, we recognize an impairment loss to the extent the carrying amount exceeds the estimated fair value of the property.
During the three and six months ended June 30, 2009, we recognized impairment losses of $5.0 million and $5.5 million respectively, related to properties classified as held for use as of June 30, 2009. We recognized no such impairment losses during the three and six months ended June 30, 2008. General and Administrative Expenses
For the three months ended June 30, 2009, compared to the three months ended June 30, 2008, general and administrative expenses decreased $9.2 million, or 33.9%. This decrease is primarily attributable to reductions in personnel and related expenses associated with our organizational restructuring initiated during the fourth quarter 2008 (see Note 4 of the condensed consolidated financial statements in Item 1 for additional information) and reduced incentive compensation costs.
For the six months ended June 30, 2009, compared to the six months ended June 30, 2008, general and administrative expenses decreased $10.4 million, or 21.6%. This decrease is primarily attributable to reductions in personnel and related expenses.

For the year ending December 31, 2009, we estimate the reductions in personnel and related expenses associated with our organizational restructuring will reduce our consolidated general and administrative expenses by approximately $20.0 million to $30.0 million as compared to the year ended December 31, 2008. Other Expenses, Net
Other expenses, net includes franchise taxes, risk management activities, partnership administration expenses and certain non-recurring items. For the three months ended June 30, 2009, compared to the three months ended June 30, 2008, other expenses, net decreased by $6.5 million. The decrease is primarily attributable to a $4.8 million write-off of certain communications hardware and capitalized costs (see Note 4 to the condensed consolidated financial statements in Item 1) in 2008, and a net reduction of $3.5 million in costs related to certain litigation matters.
For the six months ended June 30, 2009, compared to the six months ended June 30, 2008, other expenses, net decreased by $11.7 million. The decrease is primarily attributable to a $4.8 million write-off of certain communications hardware and capitalized costs (see Note 4 to the condensed consolidated financial statements in Item 1) in 2008, a net reduction of $3.2 million in costs related to certain litigation matters, and a $4.5 million reduction in expenses of our self insurance activities, related to a decrease in casualty losses on less than wholly owned properties from 2008 to 2009. Interest Income
Interest income consists primarily of interest on notes receivable from non-affiliates and unconsolidated real estate partnerships, interest on cash and restricted cash accounts, and accretion of discounts on certain notes receivable from unconsolidated real estate partnerships. Transactions that result in accretion occur infrequently and thus accretion income may vary from period to period.
For the three months ended June 30, 2009, compared to the three months ended June 30, 2008, interest income increased $0.5 million. The increase is primarily attributable to a $4.1 million adjustment to accretion on certain discounted notes during the three months ended June 30, 2008, resulting from a change in the timing and amount of collection. This increase was partially offset by a $1.5 million decrease in accretion income related to a note receivable for which we ceased accretion following impairment of the note in 2008 and a decrease of $1.9 million due to lower interest rates on notes receivable, cash and restricted cash balances and lower average balances during 2009. For the six months ended June 30, 2009, compared to the six months ended June 30, 2008, interest income decreased $5.7 million. The decrease is primarily attributable to a decrease of $4.9 million due to lower interest rates on notes receivable, cash and restricted cash balances and lower average balances, and a $2.7 million decrease in accretion income related to a note receivable for which we ceased accretion following impairment of the note in 2008. These decreases were partially offset by a $2.3 million net adjustment to accretion on certain discounted notes during the six months ended June 30, 2008, resulting from a change in the timing and amount of collection. Interest Expense
For the three months ended June 30, 2009, compared to the three months ended June 30, 2008, interest expense, which includes the amortization of deferred financing costs, increased by $1.1 million, or 1.2%. Interest expense related to property loans payable increased by $2.9 million primarily due to increased pre-payment penalties resulting from increased refinancing activities and . . .