On November 2, 2009, we issued a press release and supplemental financial data with respect to our financial results for the quarter ended September 30, 2009. Copies of the press release and supplemental financial data are furnished as Exhibit 99.1 and Exhibit 99.2 to this report, respectively. The information contained in this Item 2.02 and the attached Exhibit 99.1 and Exhibit 99.2 are furnished to, and not filed with, the Securities and Exchange Commission.

November 2, 2009 we reported operating results for the quarter ended September 30, 2009. All per share results are reported on a fully diluted basis.

Funds from operations (FFO), the generally accepted measure of operating performance for real estate investment trusts, totaled $32.5 million, or $0.59 per share, for third quarter 2009, as compared with $36.3 million, or $0.69 per share, for the quarter ended September 30, 2008. FFO for the 2009 and 2008 periods reflected the net impact of the adoption of APB-14-1, totaling $1.6 million, or $0.03 per share in each period. FFO for the third quarter 2009 also included nonroutine income of $382,000, or $0.01 per share, from a net gain on the retirement of debt. Excluding nonroutine income and the APB-14-1-related noncash interest charge, core FFO per share declined 15% on a year-over-year basis. (A reconciliation of net income available to common shareholders to FFO is provided at the end of this release.)

Net income available to common shareholders for the third quarter totaled $16.6 million, or $0.31 per share, as compared with $40.0 million, or $0.77 per share, for the same period 2008. The third quarter 2009 results included the nonroutine income item cited previously. Gains from property sales totaling $7.3 million, or $0.14 per share, and $24.8 million, or $0.48 per share, for 2009 and 2008, respectively, also are included in third quarter results.

Total revenues from continuing operations for the quarter were $86.5 million, as compared with $87.9 million a year ago. Adjusted EBITDA for the quarter totaled $55.7 million, as compared with $61.8 million in third quarter 2008. (A reconciliation of net income available to common shareholders to Adjusted EBITDA is provided at the end of this release.)

Nine-Month Period Ended September 30, 2009

For the year-to-date period, FFO totaled $104.5 million, or $1.95 per share, as compared with $105.7 million, or $2.00 per share, for the nine-month period in 2008. FFO for the nine-month period in 2009 and 2008 reflected the net impact of APB-14-1, totaling $4.8 million, or $0.09 per share, and $4.6 million, or $0.09 per share, respectively. FFO for the nine-month period in 2009 also included nonroutine income from a net gain on retirement of debt totaling $2.3 million, or $0.04 per share. Excluding nonroutine income and the noncash charge related to APB-14-1, core FFO per share declined 4.3% year-over-year.

For the nine-month period in 2009, total revenues from continuing operations were $259.1 million, as compared with $258.4 million for the same period 2008. Adjusted EBITDA for the nine-month period totaled $171.4 million, as compared with $182.7 million for the same period in 2008.

Our year-over-year earnings and FFO results reflected declines in the same-store property-level operating results, which were offset by income from recently developed properties, a lower interest rate environment and a reduction in corporate-level G&A expenses.

Same-store net operating income (NOI) declined $4.6 million for the quarter, as compared with the same period in 2008. (A reconciliation of net income available to common shareholders to NOI is provided at the end of this release.) Recently developed properties generated $1.6 million in additional NOI during the quarter, as compared with third quarter 2008.

Same-Store Property Results

We define same-store properties as stabilized apartment communities that we have owned for at least five full quarters. Of the 21,245 apartment we own, same-store units totaled 19,572 for the quarter.

On a year-over-year basis, overall same-store NOI declined 7.9% for the third quarter and 5.3% for the year-to-date period. Average same-store market rent for the third quarter 2009 decreased 6.9% to $1,434 per unit, from $1,540 per unit in third quarter 2008. Physical occupancy levels averaged 94.7% during third quarter 2009, as compared with 94.9% for the same period in 2008. Physical occupancy at the end of the third quarter 2009 was 95.4%. Rent concessions in the same-store portfolio totaled $2.8 million, or 13 days rent, for third quarter 2009, as compared with $1.5 million, or 7.6 days, for the same period in 2008.

On a sequential basis, same-store NOI decreased 1.5%, revenue declined 0.7% and expenses increased 1.0% against second quarter 2009 results. Sequential declines in effective rent levels were partially offset by a sequential increase in occupancy.

                               Same-Store              Absolute Job Losses
                                        %        12 months ended   3 months ended
        Core Markets         # Units   NOI       September 2009    September 2009
        San Diego              3,958   23.2 %             53,100            9,500
        Inland Empire          3,553   14.8 %             73,200           10,200
        Orange County          2,545   14.2 %             56,800              300
        Los Angeles            2,075   11.1 %            173,700           24,400
        San Francisco          2,928   19.3 %            136,300           13,500
        Seattle                3,211   13.7 %             85,800           16,300
        Total Core Markets    18,270   96.3 %            578,900           74,200

Source of Unemployment and Job Loss Data: U.S. Bureau of Labor Statistics

Community Development Activity

Year-to-date, we have completed three development communities that are in the lease-up phase: 5600 Wilshire in Los Angeles, Calif. (284 units); Park Viridian in Anaheim, Calif. (320 units); and Taylor 28 in Seattle, Wash. (197 units). The current physical occupancy rates at these communities are: 98% at 5600 Wilshire; 85% at Park Viridian; and 69% at Taylor 28; leasing velocity has averaged 34 units, 30 units and 22 units per month, respectively, since the communities opened.

We currently have two communities under construction, one in Seattle, Wash., and one in Santa Clara, Calif., with a total of 566 units, an aggregate projected investment of $176.1 million and an estimated balance to complete totaling $31.2 million. Estimated completion dates are first and third quarter 2010, respectively.

We own three land parcels, two in Southern California and one in Northern California, representing 960 units of future development, and an estimated aggregate investment of $455 million upon completion.

During the quarter, we sold a stabilized community in Sacramento: Arbor Pointe (240 units). Sales proceeds totaled approximately $15.4 million; we recorded a gain on sale of approximately $7.3 million, or $0.14 per share. No assets were classified as held for sale at September 30, 2009. Information regarding this sale was disclosed previously in our second quarter earnings release and Form 10-Q.

Capital Markets Activity

During the quarter, we repurchased through open market transactions $5.0 million of its 4.125% convertible notes, at 90.3% of par, resulting in a net gain of $382,000.

Under the at-the-market equity distribution agreement filed with the Securities and Exchange Commission on Form 8-K on May 14, 2009, we issued 1.5 million shares of common stock in the third quarter, at an average price of $28.00 per share, with total proceeds of $42.0 million. Year-to-date, we have issued approximately 3.0 million shares of common stock, at an average price of $26.39 per share, with total gross proceeds of $79.6 million. The remaining capacity under the equity distribution agreement on file totals $45.4 million.

During the quarter, we received the second $310.0 million advance from the $620.0 million secured credit facility with Fannie Mae, which was closed and reported in April. Proceeds were used to pay down our unsecured credit facility. The balance on the credit facility, as of September 30, was $248.0 million.

Common and Preferred Dividends Declared

On October 29, 2009, our Board of Directors approved regular common and preferred stock dividends for the quarter ending December 31, 2009. All common and preferred dividends will be payable on Thursday, December 31, 2009 to shareholders of record on Tuesday, December 15, 2009. The quarterly common dividend payment of $0.375 is equivalent to $1.50 per share on an annualized basis, and represents a yield of approximately 5.51% on Friday's closing price of $27.23 per share. We have paid uninterrupted quarterly dividends to shareholders since being founded in 1970.

Our 6.75% Series C preferred dividend is $0.421875 per share; the 6.75% Series D preferred dividend is $0.421875 per share.

We have adjusted our FFO guidance for the full year 2009 to a range of $2.44 to $2.50 per share, from the previous range of $2.42 to $2.52. We also have adjusted our per-share core FFO guidance for 2009, which excludes the nonroutine income item and APB-14-1 noncash interest expense, to a range of $2.52 to $2.58, from the previous range of $2.50 to $2.60. The mid-points of both ranges remain unchanged.

We expect to issue earnings guidance for 2010 with its fourth quarter 2009 earnings release in February 2010.

BRE Properties, Inc.

Consolidated Balance Sheets

Third Quarter 2009

(Unaudited, dollar amounts in thousands except per share data)





                                                        September 30,         September 30,
                                                            2009                2008 (1)
ASSETS
Real estate portfolio:
Direct investments in real estate:

Investments in rental properties                       $     3,113,149       $     2,860,314
Construction in progress                                       144,895               313,196
Less: accumulated depreciation                                (561,900 )            (494,380 )

                                                             2,696,144             2,679,130

Equity in real estate joint ventures:
Investments                                                     62,336                62,501

Real estate held for sale, net                                      -                 65,873

Land under development                                         131,936               119,548


Total real estate portfolio                                  2,890,416             2,927,052

Cash                                                             7,029                 3,801
Other assets                                                    73,889                78,539


TOTAL ASSETS                                           $     2,971,334       $     3,009,392

LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities:
Unsecured senior notes                                 $       857,171       $     1,513,963
Unsecured line of credit                                       248,000               295,000
Mortgage loans payable                                         752,778               152,163
Accounts payable and accrued expenses                           54,226                75,486


Total liabilities                                            1,912,175             2,036,612


Redeemable noncontrolling interests                             32,567                49,515


Shareholders' equity:

Preferred Stock, $0.01 par value; 20,000,000 shares
authorized: 7,000,000 shares with $25 liquidation
preference issued and outstanding at September 30,
2009 and September 30, 2008, respectively.                          70                    70

Common stock, $0.01 par value, 100,000,000 shares
authorized. Shares issued and outstanding:
54,337,680 and 51,091,830 at September 30, 2009 and
September 30, 2008, respectively.                                  543                   511

Additional paid-in capital                                   1,025,979               922,684


Total shareholders' equity                                   1,026,592               923,265


TOTAL LIABILITIES AND SHAREHOLDERS EQUITY              $     2,971,334       $     3,009,392

(d) Exhibits.

Exhibit
Number       Description
 99.1        Press release of BRE Properties, Inc. dated November 2, 2009,
             including attachments.

 99.2        Supplemental Financial data dated November 2, 2009, including
             attachments.