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OPERATOR: Good day, everyone, and thank you all for joining us to discuss Equity LifeStyle Properties fourth quarter and year ended December 31, 2008, results. Our featured speakers today are Tom Heneghan, our CEO; Joe McAdams, our President; and Michael Berman, our CFO.
In advance of today's call, management released earnings. Today's call will consist of opening remarks and a question-and-answer session with management relating to the Company's earnings release. As a reminder, this call is being recorded.
Certain matters discussed during this conference call may contain forward-looking statements in the meanings of the federal securities laws. Our forward-looking statements are subject to certain economic risks and uncertainties. The Company assumes no obligation to update or supplement any statements that become untrue because of subsequent events.
At this time I would like to turn the call over to Tom Heneghan, our CEO. Please proceed.
TOM HENEGHAN, CEO, EQUITY LIFESTYLE PROPERTIES, INC.: Thank you for joining us today as we discuss our year-end results for 2008 and our outlook for 2009. The 2008 financial performance for both the fourth quarter and the year continue to reflect the stability of our core business. In an environment of extreme uncertainty, the strength of our business plan is a primary contributor to this solid performance.
Our story is familiar because it has been so consistent. It is to own high-quality real estate locations across the country in areas where people want to be -- the Sun Belt, retirement, and vacation destinations, along the coast, major lakes and rivers, and near major metropolitan areas; to attract high-quality empty nester and retirement customers with a goal of long-term lasting relationships. And to use our geographic breadth, flexibility of product offerings, and myriad lifestyle options to create a robust operating platform able to meet our customers' changing needs and lifestyles.
Very simply, our goal has been to find high barrier-to-entry real estate that we believe will be in demand over the long term due to the favorable demographic trends and use our operating platform to generate stable and predictable cash flow. In addition, our ability to react to the increased uncertainty has been a key driver of our 2008 performance.
In this regard I would like to discuss some themes that ran through our previous earnings calls and how they played a part in contributing to our 2008 performance. In late 2007 we commented about the issues in the single-family housing market. We indicated that the issues bore a striking resemblance to the meltdown in the manufactured housing industry that occurred in the late 1990s and early 2000s, and which is still impacting the industry today.
As a result, we expected a long, slow, and painful process and proceeded to orient our business to react to this situation. We announced that Joe McAdams would join us as president to provide additional depth and experience in our senior management. In January 2008 we highlighted the importance of quality earnings and balance sheet flexibility. Quality of earnings for ELS has meant high quality customers with recurring, long-term relationships focused on the empty nester and retiree. We believe that this segment was better position financially and less susceptible to job growth or other economic concerns and had safety nets available, such as Social Security, pensions, and retirement accounts.
Our operating philosophy revolves around an emphasis on creating recurring cash flow and this is reflected in our compensation. We avoid stock options since they can encourage a swing for the fences mentality on the upside and a desire to recut the deal on the downside. Our annual bonus targets focus on key operating statistics that produce long-term value, such as occupancy, core revenue growth, additional annual resort revenue, core NOI growth, home sales volumes, and capital spending.
We avoided an over reliance on transactionally-driven income, such as development in joint ventures, or an overemphasis on per-share data to the detriment of solid operating performance. This is not to say our earnings guidance is taken lightly and on a few occasions over the years the bonus pool fell before guidance was reduced.
Our emphasis on balance sheet flexibility reflects our long-held belief that this flexibility allows us to make decisions that we want to make instead of decisions that we are forced to make. Our dividend level allows us to retain significant amounts of free cash flow.
On the financing side, we focused on single-asset, secured lending and developed a diverse source of lenders including insurance companies, pension funds, securitizations, and government-sponsored enterprises. Our relatively small loan size and single-asset focus lessens event risk at the portfolio level and improves our refinancing capabilities. In addition, we have …