Creating a standard annotation feature class at the root level of a geodatabase

Steps:

1. In the Catalog tree, right-click the geodatabase in which you want to create the new annotation class.
2. Point to New > Feature Class.
3. Type the Name.
4. Click the Type drop-down arrow and click Annotation Features.
5. Click Next.
6. Specify a spatial reference for your annotation feature class. A spatial reference consists of a coordinate system, spatial domain, and precision.
7. Either navigate to and click a coordinate system in the coordinate system window or click Import or New to specify a coordinate system.

Import lets you import a coordinate system from an existing feature class or feature dataset.

New allows you to create a new coordinate system.

Once you have chosen a coordinate system, you can click Modify to alter it.

8. Click Next.
9. The x/y domain is calculated based on the coordinate system you specified in step 3. You can type a different x/y domain if you want, but the default should be sufficient.
10. Click Next.
11. Enter a reference scale.

The scale should be equal to the scale at which the annotation will normally display.

12. Click the Map Units drop-down arrow and choose the units in which your annotation will be stored. The units should match the units you specified for your coordinate system in step 3.
13. To set the "Require symbol to be selected from the symbol table" option, see Annotation feature class editing properties.
14. Click Next.
15. For the Text Symbol, set the default text symbol properties for the first annotation class.
16. Specify the visible scale range for annotation in this class.
17. If you want to add an additional annotation class, click New and specify the name of the annotation class. Repeat steps 12 and 13 to set its properties.
18. Repeat step 14 until you have specified all the annotation classes and their properties.
19. Click Next.
20. If you are creating the new annotation feature class in a file or ArcSDE geodatabase, and you want to use a custom storage keyword, click Use configuration keyword, then choose the keyword you want to use from the drop-down list. If you don't want to use a custom storage keyword, leave the Default.
21. Click Next.
22. By default, there are several fields that are added to an annotation feature class. Some of these are required, whereas others are optional. If you don't require the optional fields, you can delete them now or delete them with the Feature Class Properties dialog box after you've created the feature class. To see a list of the required fields, see Managing annotation feature class properties.

If you want to bring in fields from another feature class (geodatabase, coverage, and so on), click Import. You can also manually add fields to your annotation feature class.

23. Click Finish.