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payable, accrued expenses and tenant security deposits in the accompanying consolidated balance sheets at their fair values of approximately $2.1 million and $6.3 million, respectively. The offsetting adjust- ments of $2.1 million and $6.3 million, respectively, were reflected as deferred losses in accumulated other comprehensive income (loss) in the stockholders’ equity section of the accompanying consolidat- ed balance sheets. Balances in accumulated other comprehensive income (loss) are recognized in earn- ings as swap payments are made. During the next twelve months, we expect to reclassify $0.9 million from accumulated other comprehensive income (loss) to interest expense. 

## N O T E 6 : S E C U R E D N O T E S PAYA B L E 

Secured notes payable consist of the following (in thousands): 

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Our secured notes payable generally require monthly payments of principal and interest.The total net book values of properties securing debt were $776,342,000 and $369,731,000 at December 31, 2004 and 2003, respectively.At December 31, 2004, our secured notes payable were comprised of $437.2 mil- lion and $201.7 million of fixed and variable rate debt, respectively, compared to $297.5 million and $22.5 million of fixed and variable rate debt, respectively, at December 31, 2003. 

Future principal payments due on secured notes payable as of December 31, 2004, are as follows (in thousands): 

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(1) The weighted average interest rate is calculated based on the outstanding debt as of January 1st of each year. 

## N O T E 7 : I S S U A N C E S O F C O M M O N S T O C K 

In February 2002, we sold 418,970 shares of our common stock. The shares were issued at a price of $39.46 per share, resulting in aggregate proceeds of approximately $16.1 million (after deducting under- writing discounts and other offering costs). 

In July 2002, we sold 2,000,000 shares of our common stock. The shares were issued at a price of $41.07 per share, resulting in aggregate proceeds of approximately $81.4 million (after deducting under- writing discounts and other offering costs). 

