This is Chris Nines, Chief Financial Officer of Forestar Real Estate Group and I’d like to welcome each of you who have joined us by conference call or webcast this morning to discuss the results for second quarter 2008. Joining me this morning is Jim DeCosmo, President and CEO of Forestar Real Estate Group. Let me remind you to please review the warning statements in our press release and our slides concerning forward-looking statements as we will make forward-looking statements during this presentation. This morning Jim DeCosmo and I will provide an update on our value creation activities for second quarter 2008. At the completion of the presentation we will be happy to take your questions. Thanks for your interest in Forestar Real Estate Group. I’d now like to turn the call over to Jim.

Good morning and welcome to the call and the webcast. Before Chris reviews the financials, I want to make a few comments relative to the quarter current state of business in the markets. With regard to housing markets my comments certainly won’t be a surprise. The markets continue to slow and are best characterized by poor buyer and builder sentiment, tightening mortgage requirements, minimal credit availability, high inventories and foreclosure rates. Fortunately, the majority of our active projects are in the major markets of Texas where we continue to generate sales albeit at a slower rate and our prices are stable. Given our mix of markets, a low basis portfolio, natural resources and a healthy balance sheet we’re well positioned for this phase of the cycle. As you would expect, record oil and elevated gas prices in the second quarter generated significant activity in our mineral assets. We’ll provide additional detail and commentary in upcoming slides. The distress in the housing and the financial markets are expected to create acquisition opportunities. There were no projects acquired in the quarter. To date there have been very few distressed properties priced at levels that meet expected returns. Generally speaking bid and ask spreads are still too wide. In the next few slides I’ll briefly comment on our performance related to our strategy. In the second quarter we saw just over 500 undeveloped acres at an average price of approximately $5,900 an acre. As you’d expect in today’s market, most sales are all cash. Very little financing is available which limits the buyer pool. We moved 4,500 undeveloped acres into the entitlement process and we secured entitlements on 2,000 acres with a solid mix between residential and commercial uses. Real estate sales were 264 lots at an average price of $55,000 per lot…

Despite challenging market conditions for our real estate segment, net income for second quarter 2008 was $9.6 million or $0.27 per diluted share outstanding compared with net income of $14.4 million or $0.41 per diluted share in the second quarter 2007 and a net loss of $0.2 million or $0.01 per share in the first quarter 2008. Second quarter 2008 results reflect the benefit of our value creation strategy in maximizing the value of our natural resources by increasing leasing activity on our mineral acres. Second quarter 2008 financial results included a $2.3 million after-tax charge or $0.06 per diluted share principally related to environmental remediation activities at our San Joaquin River project located near Antioch, California. This 288-acre site located outside of Oakland was transferred to us from Temple-Inland prior to our spinout last year. Portions of this site were used for a container-board mill which was shut and dismantled in 2002. To date we have received environmental certification of completion on approximately 180 acres and we are currently working on the balance of the site. This project is located along the San Joaquin River, a major shipping lane, and its greatest value will most likely include commercial and/or industrial uses following the completion of our remediation activities. In addition, let me remind you that first quarter 2008 results included $1 million after-tax charge or $0.02 per share related to share-based compensation expenses for retirement eligible employees. Second quarter 2008 weighted average basic shares outstanding were 36.1 million shares. Now let me turn to our segment results. We manage our operations through three business segments: Real estate, mineral resources, and fiber resources. Real estate secures entitlements and develops infrastructure on our lands primarily for single family residential and mixed-use communities and manages our undeveloped land in commercial properties. Our…

Our real estate value creation pipeline’s comprised of four distinct value categories with the strategy being to create value by moving acreage and product through the value chain from left to right. At second quarter end 2008 we had approximately 319,000 low basis undeveloped acres of real estate principally located in and around Atlanta. The majority of this segment is comprised of acreage we selected from the 2 million acre land portfolio once owned by Temple-Inland. We’ve got 33,600 acres in the entitlement process, just under 15,000 acres entitled, and just over 3,500 acres in the development category yielding our real estate portfolio of just under 371,000 acres. In addition we have an estimated 25,000 lots in the entitled category and 4,793 lots in development for a total estimated lot count of just over 29,000. Not reflected in this acreage is our 58% ownership interest in Ironstob venture which controls approximately 17,000 acres. This acreage is principally located in Paulding, Polk and Harrison Counties with Paulding being one of the fastest-growing counties in the US. The next two slides are our real estate key performance indicators which is in essence a reconciliation of our progress in creating value by moving acreage through the pipeline. Residential lot sales were down in the second quarter 2008 yet price and profit per lot continue to hold. Over 90% of our lot sales were in the major markets of Texas which is a positive reflection of our portfolio. Texas inventories are in generally pretty good shape and prices are stable principally due to the fact that Texas didn’t experience excessive run-up in price in the first half of the decade and job creation continues to exceed the national average. In the second quarter we sold 47 acres of commercial property for just over $271,000…

(Operator Instructions) Our first question comes from Mark Winetraub - Buckingham Research.

Can you help us understand as you are looking at the mineral rights opportunities, the tradeoff between leasing versus selling the mineral rights? Obviously International Paper announced the other day how they were selling some at De Soto which was very central to Haynesville and we’re getting a very handsome price for that. How do you look at the tradeoff between leasing it versus just actually selling it outright?

I think it’s a fairly standard view that we take and that if you look at minerals and their values over time and what creates the greatest value, it typically has not just been in sales. There are a number of examples where significant value was created through the leasing and the proving up of these properties prior to any sale. There’s a significant difference between our minerals today and the sale that you mentioned. That sale is in I would say the core or in a proven part of the Haynesville play. The majority of our minerals as I said in my prepared comments have yet to be proven and I think at some point in time we would consider those alternatives. I would say today it’s much too early.

If I understand correctly, basically since you don’t really have proven plays it doesn’t make a lot of sense to be selling them. So when we see on the map for instance on page 17, which is great, and we see that there are “held by production,” how does that distinguish from proven or how should we understand to differentiate between potential values of headline numbers we see out of for instance the International Paper sale and what we see on this chart here?

The held by production is a term that’s used to indicate that there is production on those properties by active production in sales of wells. One thing you’ve got to understand is that the penetration of these wells may be in a certain formation; they could be 7,000 feet or 9,000 feet; it could be in a younger formation; whereas there’s real potential value at a deeper formation. If you look at that chart and you see a James Lime and Cotton Valley and Haynesville, they could all be under the same surface acre at various depths. So that production is related to one of the formations so we would tell you yes, there is production there. Has the greatest value been realized? We believe not.

Our next question comes from Analyst for Ben Lawrence - Suttonbrook. [Analyst for Ben Lawrence - Suttonbrook]: I just want to follow up on that same page again. It seems that given the [inaudible] of Haynesville I just want to see how many acres you have there and if you have the mineral rights at all those acres? I want to see how many acres in particular you own in the Haynesville Shale and whether you own mineral rights in all of those acres.

Currently in the active Haynesville Shale play we do not own any acres. As I said in my remarks we’re currently about 65 to 75 miles from the most active part of the Haynesville play. As I said, it’s going to take time to see if this acreage is going to produce with the Haynesville but that’s going to take exploration and drilling to prove that up. That’s the last question. Once again we want to thank you for your time this morning and interest in Forestar. And we wish everybody the best of the day.