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[Tarragon Corporation Letterhead]

August 9, 2005

BY EDGAR

Mr. Jeffrey B. Werbitt

Attorney-Advisor

Office of Mergers and Acquisitions

Securities and Exchange Commission

100 F Street, N.E.

Washington, D.C. 20549

    Re:

    Tarragon Corporation

    Schedule TO-I

    Filed on July 18, 2005

    File No. 005-54669

Dear Mr. Werbitt:

     Reference is made to your letter, dated August 1, 2005, regarding comments by the staff of the
Securities and Exchange Commission (the “Commission”) with respect to the above-referenced Schedule
TO-I of Tarragon Corporation (the “Company”). Today, in response to your letter, the Company is
filing with the Commission Amendment No. 1 to the Schedule TO-I filed with the Commission on July
18, 2005.

     Below are the Company’s responses to each comment in your letter. For the convenience of the
staff, the Company has repeated each of your comments before the response. Unless otherwise
indicated, page references included in the body of the Company’s responses are to Amendment No. 1
to the Schedule TO-I.

Schedule TO-I

General

    1.

    We note that holders of $1,000 principal amount of convertible notes will receive 81.6993
shares of your common stock, $50.00 in cash and accrued and unpaid interest up to the
expiration date of the offer. Please disclose the cash amount of the accrued and unpaid
interest anticipated to be paid if the offer ends, as expected, on August 15, 2005.

Response: The Company has revised the disclosure throughout the filing to include the cash
amount of the accrued and unpaid interest anticipated to be paid if the offer ends, as
expected, on the revised expiration date of August 23, 2005. In this regard, the Company
notes that the filing has been revised to reflect an increase in the cash premium payable to

Mr. Jeffrey B. Werbitt

Securities and Exchange Commission

August 9, 2005

Page 2

converting holders from $50.00 to $80.00 per $1,000 principal amount of convertible notes,
in addition to such accrued and unpaid interest. The Company has revised the disclosure
throughout the filing and the offering materials to reflect the increased consideration
payable in the offer and the extension of the offer until August 23, 2005 such that the
offer will remain open for 10 business days from the date that the change in price is being
disseminated to security holders.

    2.

    Please explain in your response letter why you have not provided the pro forma financial
information required by Item 1010(b) of Regulation M-A. We may have additional comments after
reviewing your response.

Response: The Company has elected to include unaudited consolidated pro forma financial
data in response to the staff’s comment.

Offer to Convert

Summary of the Offer to Convert, page 1

    3.

    You disclose throughout your document, including but not limited to pages 3, 4, 7, 10 and 33
that you “expressly reserve the right to terminate the offer to convert, in your sole and
absolute discretion, at any time prior to the completion of the Offer to Convert.” Please be
advised that you may terminate the offer only if one of the listed offer conditions so
permits. In this regard, since you do not reference the occurrence of any listed offer
condition, this language seems to inappropriately imply that you may terminate the offer at
will, in your sole discretion, and for any reason. Please confirm your understanding and
revise the disclosure throughout your Offering Circular.

Response: The Company acknowledges that it may terminate the offer only if one of the
listed offer conditions so permits. In this regard, the Company has revised the disclosure
throughout the offering circular to reference the occurrence of one of the listed offer
conditions as a condition to the Company’s ability to terminate the offer.

    4.

    We note that you will issue the shares of your common stock and the cash portion of the
consideration promptly after acceptance of the convertible notes for conversion. We also note
that the payment of the cash portion of the consideration will be administered by the
conversion agent “as promptly as practicable.” Please reconcile your disclosure. Note that
Rules 13e-4(f)(5) and 14e-1(c) requires Tarragon to exchange all notes tendered “promptly”
after the expiration date. See Exchange Act Release 43069, July 31, 2000, for
additional guidance concerning an interpretation of what timeframe is considered prompt.
Please revise this and similar language throughout the document. Alternatively, explain the
basis for your belief that your disclosure is consistent with the prompt payment requirement.

Mr. Jeffrey B. Werbitt

Securities and Exchange Commission

August 9, 2005

Page 3

Response: The Company has revised the disclosure on page 4 and throughout the document
consistent with the prompt payment requirement.

    5.

    We refer you to the disclosure regarding the United States Federal Income Tax Consequences.
Please revise your disclosure here and throughout the document to explain why you believe that
the tax treatment of this transaction is uncertain. Also, to the extent possible, your
disclosure should provide an explanation of the degree of the uncertainty regarding the tax
treatment of this exchange.

Response: The Company has revised the tax disclosure on page 5 and throughout the document
to explain in more detail why it believes the tax treatment of this transaction is uncertain
and to provide an explanation of the degree of the uncertainty regarding the tax treatment
of this exchange.

Acceptance of the Convertible Notes, page 4

    6.

    In the first sentence of the last paragraph on page 4, you refer to a situation where you may
decide “for any reason” not to accept some or all of a security holder’s tendered notes. See
comment 3 above regarding impermissible illusory offers. You may elect not to accept tendered
securities only because (i) an offer condition has been triggered and the offer has been
terminated or (ii) the tender is defective. Please revise.

Response: The Company has revised the disclosure on page 4 and throughout the document to
provide that it may elect not to accept tendered securities only because (i) an offer
condition has been triggered and the offer has been terminated or (ii) the tender is
defective.

The Offer to Convert, page 31

Extension, Delay in Acceptance Amendment or Termination, page 32

    7.

    We note that you reserve the right to “delay the acceptance for conversion of any convertible
notes tendered pursuant to the offer to convert regardless of whatever (sic) any convertible
notes were previously accepted for conversion.” This language is qualified by the disclosure
in the first paragraph on page 33, but the seeming contradiction makes less than clear those
circumstances to which you refer in the quoted language above. Please note that payment may
only be delayed in anticipation of governmental regulatory approvals, not to effect general
legal compliance. Also, you may not delay payment while you wait to satisfy all offer
conditions. In this regard, your condition must be satisfied or waived as of the expiration
of the offer. Please revise your disclosure or otherwise advise of the basis for your belief
that you may delay the acceptance of your convertible notes.

Mr. Jeffrey B. Werbitt

Securities and Exchange Commission

August 9, 2005

Page 4

Response: The Company has revised the disclosure on page 33 to indicate that payment may
only be delayed in anticipation of governmental regulatory approvals. In this regard, the
Company has revised the disclosure on page 35 to indicate that all offer conditions, except
those related to the receipt of governmental regulatory approvals necessary to consummate
the offer, must be satisfied or waived at or before the expiration of the offering period.

    8.

    Refer to the last comment above. Explain how you could accept some but not all tendered
notes. Are you referring to notes with defects in tender? If so, explain why you would
acceptance of such notes rather than simply rejecting them. We may have further comments.

Response: The Company has revised the disclosure on page 33 and throughout the offering
materials to eliminate the reference to the acceptance of some but not all tendered notes.
The Company supplementally advises the staff that it will accept all convertible notes
properly tendered for conversion on or prior to the expiration date.

Conditions to the Offer to Convert, page 33

    9.

    We refer you to the disclosure in the last sentence of the last paragraph of this section
that your failure at any time to exercise any of the offer conditions will not be deemed a
waiver of such conditions. This language suggests that even once a condition is triggered,
the company can decide whether it is advisable to proceed with the offer. We agree. However,
when a condition is triggered and the company decides to proceed with the offer anyway, we
believe that this constitutes a waiver of the triggered condition(s). You may not rely on
this language to tacitly waive a condition of the offer by failing to assert it. Please
revise.

Response: The Company has revised the disclosure on page 35
clarify that all other conditions, except those related to the
receipt of regulatory approvals, must be satisfied or waived at or
before the expiration of the offer period. In this regard, the
Company has removed the specified language suggesting that the
Company may tacitly waive a condition of the offer by failing to
assert it.

    10.

    While you may condition your tender offer on any number of conditions, those conditions must
be clearly and specifically described in your offer materials and must be outside of your
control. We are concerned that some of the listed offer conditions are so broadly drafted as
to potentially render this offer illusory, and to make it impossible for a security holder to
determine what events or occurrences will allow you to terminate it. Please generally revise
to narrow your conditions, quantifying where possible. The following are examples of offer
conditions which we believe are problematic because of their breadth or lack of specificity;
however, these examples are not intended to be an exhaustive, and we urge you to examine and
revise this section generally:

    •

    The first bullet point in this section refers to “any determination.” Your
condition should contemplate who is responsible for making this

Mr. Jeffrey B. Werbitt

Securities and Exchange Commission

August 9, 2005

Page 5

determination and it should provide an objective criteria to clarify when
this offer condition is triggered. Satisfaction of the offer condition in
the sole discretion of the bidder is the equivalent of a waiver of the offer
condition. In addition, in this bullet point, the word “interruption”
appears to be a typographical error.

    •

    The third bullet point in this section refers to circumstances that “might
prohibit, prevent, restrict or delay consummation of the offer to convert...”
This condition appears to contain an excessive subjective element and should be
revised appropriately.

    •

    The fourth bullet point refers to a condition that is triggered when “there
has occurred or is likely to occur any material adverse change to [y]our
business, operations, properties, condition, assets, liabilities, prospects or
financial affairs.” This condition also appears to contain an excessive
subjective element. Additionally, revise to limit the subjectivity that may
trigger this condition. We note that you may employ your reasonable judgment
to determine whether the condition has occurred.

    •

    The first bullet point under the fifth bullet point refers to “any merger,
acquisition or other business combination proposal for [you].” This condition
is broadly drafted and suggests that it may be asserted it under almost any
circumstance. This offer condition, as currently drafted, also appears to
allow you to terminate the tender offer based on voluntary actions by the
bidder.

    •

    The third bullet point under the fifth bullet point references “any material
adverse change in the trading price of [y]our common stock...” Your disclosure
should quantify the “material adverse change” in your trading price that will
trigger this condition.

Response: The Company has revised the disclosure on page 34 and 35 and throughout the
offering materials to narrow the conditions to the offer, and to more clearly and
specifically describe those conditions.

Incorporation by Reference, page 54

    11.

    In the first paragraph of this section you disclose that some information that you file with
the commission will automatically update and supersede the information contained in or
incorporated by reference in this offer. Also, in the second to last paragraph of this
section, you attempt to “forward incorporate” by reference all future filings filed with the
Commission from the date of this offer until it is completed. However, Schedule TO does not
specifically allow you to forward incorporate disclosure in subsequently filed documents. In
fact, doing so is inconsistent with the technical requirements of General

Mr. Jeffrey B. Werbitt

Securities and Exchange Commission

August 9, 2005

Page 6

Instruction F of Schedule TO and your obligation under Rules 13e-4(c)(3) and 13e-4(e)(3) to
amend the Schedule to reflect a material change in the information previously disclosed. If
the information provided to shareholders in the Offer to Purchase materially changes, you
are under an obligation to amend the Schedule TO to update it and to disseminate the new
information to shareholders in a manner reasonably calculated to inform them about the
change. Please revise the disclosure here in accordance with this comment.

Response: The Company has revised the disclosure on page 55 and 56 of the offering circular
to remove language purporting to “forward incorporate” disclosure in subsequently filed
documents. In this regard, the Company acknowledges its obligation to update the Schedule
TO to reflect material changes in information previously provided to security holders and to
disseminate the new information to security holders in a manner reasonably calculated to
inform them about the change.

Letter of Transmittal

    12.

    We note that page 1 of your letter of transmittal requests that the security holder
acknowledge that they have “read the offering circular.” It is not appropriate to require
security holders to attest to the fact that they “read” the offering circular as such language
effectively operates as a waiver of liability. Please delete this and other similar language
throughout these materials.

Response: The Company has revised the disclosure throughout the offering materials to
remove language requiring security holders to attest to the fact that they “read” the
offering circular.

*****

     As requested in your comment letter, the Company hereby acknowledges that:

    •

    the Company is responsible for the adequacy and accuracy of the disclosure
in its filings;

    •

    staff comments or changes to disclosure in response to staff comments in the
filings reviewed by the staff do not foreclose the Commission from taking any
action with respect to the filing; and

    •

    the Company may not assert staff comments as a defense in any proceeding
initiated by the Commission or any person under the federal securities laws of
the United States.

Mr. Jeffrey B. Werbitt

Securities and Exchange Commission

August 9, 2005

Page 7

     Please contact our counsel, James E. O’Bannon at 214-969-3766 or Edward B. Winslow at
312-269-4223 of Jones Day, if you have any further questions concerning this filing. Thank you for
your attention to this matter.

    Very truly yours,

/s/ Erin D. Pickens

Erin D. Pickens

    cc:

    William S. Friedman, Tarragon Corporation

    Ka