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Maryland (Equity Residential)
|
13-3675988 (Equity Residential)
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Illinois (ERP Operating Limited Partnership)
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36-3894853 (ERP Operating Limited Partnership)
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
|
|
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Two North Riverside Plaza, Chicago, Illinois 60606
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(312) 474-1300
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(Address of principal executive offices) (Zip Code)
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(Registrant's telephone number, including area code)
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Equity Residential Yes
x
No
¨
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ERP Operating Limited Partnership Yes
x
No
o
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Equity Residential Yes
x
No
¨
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ERP Operating Limited Partnership Yes
x
No
o
|
Equity Residential:
|
|
Large accelerated filer
x
|
Accelerated filer
¨
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Non-accelerated filer
¨
(Do not check if a smaller reporting company)
|
Smaller reporting company
¨
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ERP Operating Limited Partnership:
|
|
Large accelerated filer
¨
|
Accelerated filer
¨
|
Non-accelerated filer
x
(Do not check if a smaller reporting company)
|
Smaller reporting company
¨
|
Equity Residential Yes
¨
No
x
|
ERP Operating Limited Partnership Yes
¨
No
x
|
•
|
enhances investors' understanding of the Company and the Operating Partnership by enabling investors to view the business as a whole in the same manner as management views and operates the business;
|
•
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eliminates duplicative disclosure and provides a more streamlined and readable presentation since a substantial portion of the disclosure applies to both the Company and the Operating Partnership; and
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•
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creates time and cost efficiencies through the preparation of one combined report instead of two separate reports.
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PAGE
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September 30,
2015 |
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December 31,
2014 |
||||
ASSETS
|
|
|
|
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||||
Investment in real estate
|
|
|
|
|
||||
Land
|
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$
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6,424,887
|
|
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$
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6,295,404
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Depreciable property
|
|
20,540,247
|
|
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19,851,504
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Projects under development
|
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1,039,657
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|
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1,343,919
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Land held for development
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154,690
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|
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184,556
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||
Investment in real estate
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28,159,481
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27,675,383
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|
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Accumulated depreciation
|
|
(5,914,695
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)
|
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(5,432,805
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)
|
||
Investment in real estate, net
|
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22,244,786
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22,242,578
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Cash and cash equivalents
|
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37,366
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40,080
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|
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Investments in unconsolidated entities
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74,108
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105,434
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Deposits – restricted
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135,674
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72,303
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Escrow deposits – mortgage
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54,071
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48,085
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Deferred financing costs, net
|
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57,001
|
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58,380
|
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Other assets
|
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405,798
|
|
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383,754
|
|
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Total assets
|
|
$
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23,008,804
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|
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$
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22,950,614
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||||
LIABILITIES AND EQUITY
|
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||||
Liabilities:
|
|
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||||
Mortgage notes payable
|
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$
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4,891,529
|
|
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$
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5,086,515
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Notes, net
|
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5,881,794
|
|
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5,425,346
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|
||
Line of credit and commercial paper
|
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29,996
|
|
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333,000
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||
Accounts payable and accrued expenses
|
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253,027
|
|
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153,590
|
|
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Accrued interest payable
|
|
86,083
|
|
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89,540
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Other liabilities
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353,106
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|
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389,915
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Security deposits
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76,934
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|
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75,633
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Distributions payable
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209,086
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|
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188,566
|
|
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Total liabilities
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11,781,555
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11,742,105
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Commitments and contingencies
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Redeemable Noncontrolling Interests – Operating Partnership
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522,585
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500,733
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Equity:
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Shareholders’ equity:
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||||
Preferred Shares of beneficial interest, $0.01 par value;
100,000,000 shares authorized; 803,600 shares issued and outstanding as of September 30, 2015 and 1,000,000 shares issued and outstanding as of December 31, 2014 |
|
40,180
|
|
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50,000
|
|
||
Common Shares of beneficial interest, $0.01 par value;
1,000,000,000 shares authorized; 364,140,040 shares issued and outstanding as of September 30, 2015 and 362,855,454 shares issued and outstanding as of December 31, 2014 |
|
3,641
|
|
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3,629
|
|
||
Paid in capital
|
|
8,584,143
|
|
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8,536,340
|
|
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Retained earnings
|
|
2,007,590
|
|
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1,950,639
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|
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Accumulated other comprehensive (loss)
|
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(157,020
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)
|
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(172,152
|
)
|
||
Total shareholders’ equity
|
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10,478,534
|
|
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10,368,456
|
|
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Noncontrolling Interests:
|
|
|
|
|
||||
Operating Partnership
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221,487
|
|
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214,411
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Partially Owned Properties
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4,643
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|
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124,909
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Total Noncontrolling Interests
|
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226,130
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339,320
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Total equity
|
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10,704,664
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10,707,776
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Total liabilities and equity
|
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$
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23,008,804
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|
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$
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22,950,614
|
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Nine Months Ended September 30,
|
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Quarter Ended September 30,
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||||||||||||
|
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2015
|
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2014
|
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2015
|
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2014
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||||||||
REVENUES
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Rental income
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$
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2,035,359
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$
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1,942,492
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$
|
694,245
|
|
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$
|
662,001
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Fee and asset management
|
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6,413
|
|
|
7,596
|
|
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2,044
|
|
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2,077
|
|
||||
Total revenues
|
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2,041,772
|
|
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1,950,088
|
|
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696,289
|
|
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664,078
|
|
||||
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||||||||
EXPENSES
|
|
|
|
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||||||||
Property and maintenance
|
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364,948
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361,087
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122,383
|
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120,139
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|
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Real estate taxes and insurance
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254,513
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245,717
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84,962
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|
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80,568
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||||
Property management
|
|
60,887
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|
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61,080
|
|
|
18,925
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|
|
18,407
|
|
||||
Fee and asset management
|
|
3,764
|
|
|
4,293
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|
|
1,169
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|
|
1,253
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|
||||
Depreciation
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584,862
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|
|
565,772
|
|
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196,059
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190,469
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||||
General and administrative
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50,942
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41,296
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15,290
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|
|
9,968
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|
||||
Total expenses
|
|
1,319,916
|
|
|
1,279,245
|
|
|
438,788
|
|
|
420,804
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||||
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||||||||
Operating income
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|
721,856
|
|
|
670,843
|
|
|
257,501
|
|
|
243,274
|
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||||
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||||||||
Interest and other income
|
|
6,906
|
|
|
3,213
|
|
|
256
|
|
|
576
|
|
||||
Other expenses
|
|
(2,839
|
)
|
|
(7,179
|
)
|
|
(1,139
|
)
|
|
(4,976
|
)
|
||||
Interest:
|
|
|
|
|
|
|
|
|
||||||||
Expense incurred, net
|
|
(333,622
|
)
|
|
(347,224
|
)
|
|
(114,205
|
)
|
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(118,251
|
)
|
||||
Amortization of deferred financing costs
|
|
(7,734
|
)
|
|
(8,554
|
)
|
|
(2,607
|
)
|
|
(2,628
|
)
|
||||
Income before income and other taxes, income (loss) from investments
in unconsolidated entities, net gain (loss) on sales of real estate properties and land parcels and discontinued operations |
|
384,567
|
|
|
311,099
|
|
|
139,806
|
|
|
117,995
|
|
||||
Income and other tax (expense) benefit
|
|
(698
|
)
|
|
(1,146
|
)
|
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(329
|
)
|
|
(260
|
)
|
||||
Income (loss) from investments in unconsolidated entities
|
|
14,388
|
|
|
(10,201
|
)
|
|
(1,041
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)
|
|
(1,176
|
)
|
||||
Net gain on sales of real estate properties
|
|
295,692
|
|
|
128,544
|
|
|
66,939
|
|
|
113,641
|
|
||||
Net (loss) gain on sales of land parcels
|
|
(1
|
)
|
|
1,846
|
|
|
—
|
|
|
1,052
|
|
||||
Income from continuing operations
|
|
693,948
|
|
|
430,142
|
|
|
205,375
|
|
|
231,252
|
|
||||
Discontinued operations, net
|
|
350
|
|
|
1,500
|
|
|
81
|
|
|
(62
|
)
|
||||
Net income
|
|
694,298
|
|
|
431,642
|
|
|
205,456
|
|
|
231,190
|
|
||||
Net (income) attributable to Noncontrolling Interests:
|
|
|
|
|
|
|
|
|
||||||||
Operating Partnership
|
|
(26,191
|
)
|
|
(16,273
|
)
|
|
(7,778
|
)
|
|
(8,738
|
)
|
||||
Partially Owned Properties
|
|
(2,473
|
)
|
|
(1,800
|
)
|
|
(986
|
)
|
|
(708
|
)
|
||||
Net income attributable to controlling interests
|
|
665,634
|
|
|
413,569
|
|
|
196,692
|
|
|
221,744
|
|
||||
Preferred distributions
|
|
(2,557
|
)
|
|
(3,109
|
)
|
|
(833
|
)
|
|
(1,037
|
)
|
||||
Premium on redemption of Preferred Shares
|
|
(2,789
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net income available to Common Shares
|
|
$
|
660,288
|
|
|
$
|
410,460
|
|
|
$
|
195,859
|
|
|
$
|
220,707
|
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share – basic:
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations available to Common Shares
|
|
$
|
1.82
|
|
|
$
|
1.13
|
|
|
$
|
0.54
|
|
|
$
|
0.61
|
|
Net income available to Common Shares
|
|
$
|
1.82
|
|
|
$
|
1.14
|
|
|
$
|
0.54
|
|
|
$
|
0.61
|
|
Weighted average Common Shares outstanding
|
|
363,386
|
|
|
360,900
|
|
|
363,579
|
|
|
361,409
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share – diluted:
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations available to Common Shares
|
|
$
|
1.80
|
|
|
$
|
1.13
|
|
|
$
|
0.53
|
|
|
$
|
0.61
|
|
Net income available to Common Shares
|
|
$
|
1.80
|
|
|
$
|
1.13
|
|
|
$
|
0.53
|
|
|
$
|
0.61
|
|
Weighted average Common Shares outstanding
|
|
380,423
|
|
|
377,228
|
|
|
380,663
|
|
|
377,954
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Distributions declared per Common Share outstanding
|
|
$
|
1.6575
|
|
|
$
|
1.50
|
|
|
$
|
0.5525
|
|
|
$
|
0.50
|
|
|
|
Nine Months Ended September 30,
|
|
Quarter Ended September 30,
|
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Comprehensive income:
|
|
|
|
|
|
|
|
|
||||||||
Net income
|
|
$
|
694,298
|
|
|
$
|
431,642
|
|
|
$
|
205,456
|
|
|
$
|
231,190
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income (loss) – derivative instruments:
|
|
|
|
|
|
|
|
|
||||||||
Unrealized holding gains (losses) arising during the period
|
|
1,796
|
|
|
(21,784
|
)
|
|
1,908
|
|
|
97
|
|
||||
Losses reclassified into earnings from other comprehensive income
|
|
13,647
|
|
|
12,606
|
|
|
4,736
|
|
|
4,271
|
|
||||
Other comprehensive (loss) income – foreign currency:
|
|
|
|
|
|
|
|
|
||||||||
Currency translation adjustments arising during the period
|
|
(311
|
)
|
|
(466
|
)
|
|
191
|
|
|
(2,184
|
)
|
||||
Other comprehensive income (loss)
|
|
15,132
|
|
|
(9,644
|
)
|
|
6,835
|
|
|
2,184
|
|
||||
Comprehensive income
|
|
709,430
|
|
|
421,998
|
|
|
212,291
|
|
|
233,374
|
|
||||
Comprehensive (income) attributable to Noncontrolling Interests
|
|
(29,244
|
)
|
|
(17,705
|
)
|
|
(9,025
|
)
|
|
(9,530
|
)
|
||||
Comprehensive income attributable to controlling interests
|
|
$
|
680,186
|
|
|
$
|
404,293
|
|
|
$
|
203,266
|
|
|
$
|
223,844
|
|
|
|
Nine Months Ended September 30,
|
||||||
|
|
2015
|
|
2014
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
||||
Net income
|
|
$
|
694,298
|
|
|
$
|
431,642
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
||||
Depreciation
|
|
584,862
|
|
|
565,772
|
|
||
Amortization of deferred financing costs
|
|
7,734
|
|
|
8,554
|
|
||
Amortization of above/below market leases
|
|
2,534
|
|
|
2,376
|
|
||
Amortization of discounts and premiums on debt
|
|
(7,718
|
)
|
|
(8,750
|
)
|
||
Amortization of deferred settlements on derivative instruments
|
|
13,483
|
|
|
12,205
|
|
||
Write-off of pursuit costs
|
|
2,322
|
|
|
2,067
|
|
||
(Income) loss from investments in unconsolidated entities
|
|
(14,388
|
)
|
|
10,201
|
|
||
Distributions from unconsolidated entities – return on capital
|
|
3,564
|
|
|
4,557
|
|
||
Net (gain) on sale of investment securities
|
|
(387
|
)
|
|
(57
|
)
|
||
Net (gain) on sales of real estate properties
|
|
(295,692
|
)
|
|
(128,544
|
)
|
||
Net loss (gain) on sales of land parcels
|
|
1
|
|
|
(1,846
|
)
|
||
Net (gain) on sales of discontinued operations
|
|
—
|
|
|
(223
|
)
|
||
Realized/unrealized loss (gain) on derivative instruments
|
|
3,055
|
|
|
(66
|
)
|
||
Compensation paid with Company Common Shares
|
|
29,269
|
|
|
24,647
|
|
||
Changes in assets and liabilities:
|
|
|
|
|
||||
(Increase) in deposits – restricted
|
|
(1,268
|
)
|
|
(2,223
|
)
|
||
Decrease in mortgage deposits
|
|
756
|
|
|
1,638
|
|
||
(Increase) decrease in other assets
|
|
(25,428
|
)
|
|
3,854
|
|
||
Increase in accounts payable and accrued expenses
|
|
63,385
|
|
|
76,331
|
|
||
(Decrease) increase in accrued interest payable
|
|
(3,457
|
)
|
|
8,163
|
|
||
Increase (decrease) in other liabilities
|
|
5,120
|
|
|
(173
|
)
|
||
Increase in security deposits
|
|
1,301
|
|
|
4,146
|
|
||
Net cash provided by operating activities
|
|
1,063,346
|
|
|
1,014,271
|
|
||
|
|
|
|
|
||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
||||
Investment in real estate – acquisitions
|
|
(159,575
|
)
|
|
(404,658
|
)
|
||
Investment in real estate – development/other
|
|
(485,758
|
)
|
|
(380,691
|
)
|
||
Capital expenditures to real estate
|
|
(134,438
|
)
|
|
(133,181
|
)
|
||
Non-real estate capital additions
|
|
(2,384
|
)
|
|
(2,446
|
)
|
||
Interest capitalized for real estate and unconsolidated entities under development
|
|
(45,850
|
)
|
|
(38,140
|
)
|
||
Proceeds from disposition of real estate, net
|
|
457,499
|
|
|
224,538
|
|
||
Investments in unconsolidated entities
|
|
(22,998
|
)
|
|
(14,568
|
)
|
||
Distributions from unconsolidated entities – return of capital
|
|
45,245
|
|
|
77,042
|
|
||
Proceeds from sale of investment securities
|
|
387
|
|
|
57
|
|
||
(Increase) decrease in deposits on real estate acquisitions and investments, net
|
|
(62,433
|
)
|
|
20,845
|
|
||
(Increase) decrease in mortgage deposits
|
|
(407
|
)
|
|
560
|
|
||
Net cash (used for) investing activities
|
|
(410,712
|
)
|
|
(650,642
|
)
|
|
|
Nine Months Ended September 30,
|
||||||
|
|
2015
|
|
2014
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
||||
Debt financing costs
|
|
$
|
(6,355
|
)
|
|
$
|
(10,598
|
)
|
Mortgage deposits
|
|
(6,335
|
)
|
|
(5,557
|
)
|
||
Mortgage notes payable:
|
|
|
|
|
||||
Lump sum payoffs
|
|
(177,564
|
)
|
|
(63,772
|
)
|
||
Scheduled principal repayments
|
|
(7,161
|
)
|
|
(8,919
|
)
|
||
Notes, net:
|
|
|
|
|
||||
Proceeds
|
|
746,391
|
|
|
1,194,278
|
|
||
Lump sum payoffs
|
|
(300,000
|
)
|
|
(1,250,000
|
)
|
||
Line of credit and commercial paper:
|
|
|
|
|
||||
Line of credit proceeds
|
|
3,569,000
|
|
|
5,324,000
|
|
||
Line of credit repayments
|
|
(3,902,000
|
)
|
|
(4,993,000
|
)
|
||
Commercial paper proceeds
|
|
2,491,848
|
|
|
—
|
|
||
Commercial paper repayments
|
|
(2,462,500
|
)
|
|
—
|
|
||
(Payments on) settlement of derivative instruments
|
|
(13,938
|
)
|
|
(758
|
)
|
||
Proceeds from Employee Share Purchase Plan (ESPP)
|
|
3,376
|
|
|
2,728
|
|
||
Proceeds from exercise of options
|
|
37,047
|
|
|
56,554
|
|
||
Common Shares repurchased and retired
|
|
—
|
|
|
(1,777
|
)
|
||
Redemption of Preferred Shares
|
|
(9,820
|
)
|
|
—
|
|
||
Premium on redemption of Preferred Shares
|
|
(2,789
|
)
|
|
—
|
|
||
Payment of offering costs
|
|
(69
|
)
|
|
—
|
|
||
Other financing activities, net
|
|
(33
|
)
|
|
(33
|
)
|
||
Acquisition of Noncontrolling Interests – Partially Owned Properties
|
|
—
|
|
|
(5,501
|
)
|
||
Contributions – Noncontrolling Interests – Partially Owned Properties
|
|
—
|
|
|
5,684
|
|
||
Contributions – Noncontrolling Interests – Operating Partnership
|
|
3
|
|
|
3
|
|
||
Distributions:
|
|
|
|
|
||||
Common Shares
|
|
(583,568
|
)
|
|
(595,564
|
)
|
||
Preferred Shares
|
|
(2,557
|
)
|
|
(3,109
|
)
|
||
Noncontrolling Interests – Operating Partnership
|
|
(22,968
|
)
|
|
(23,582
|
)
|
||
Noncontrolling Interests – Partially Owned Properties
|
|
(5,356
|
)
|
|
(6,762
|
)
|
||
Net cash (used for) financing activities
|
|
(655,348
|
)
|
|
(385,685
|
)
|
||
Net (decrease) in cash and cash equivalents
|
|
(2,714
|
)
|
|
(22,056
|
)
|
||
Cash and cash equivalents, beginning of period
|
|
40,080
|
|
|
53,534
|
|
||
Cash and cash equivalents, end of period
|
|
$
|
37,366
|
|
|
$
|
31,478
|
|
|
|
Nine Months Ended September 30,
|
||||||
|
|
2015
|
|
2014
|
||||
SUPPLEMENTAL INFORMATION:
|
|
|
|
|
||||
Cash paid for interest, net of amounts capitalized
|
|
$
|
328,400
|
|
|
$
|
335,646
|
|
Net cash paid for income and other taxes
|
|
$
|
1,052
|
|
|
$
|
866
|
|
Amortization of discounts and premiums on debt:
|
|
|
|
|
||||
Mortgage notes payable
|
|
$
|
(10,261
|
)
|
|
$
|
(10,515
|
)
|
Notes, net
|
|
$
|
1,895
|
|
|
$
|
1,765
|
|
Line of credit and commercial paper
|
|
$
|
648
|
|
|
$
|
—
|
|
Amortization of deferred settlements on derivative instruments:
|
|
|
|
|
||||
Other liabilities
|
|
$
|
(164
|
)
|
|
$
|
(401
|
)
|
Accumulated other comprehensive income
|
|
$
|
13,647
|
|
|
$
|
12,606
|
|
Write-off of pursuit costs:
|
|
|
|
|
||||
Investment in real estate, net
|
|
$
|
1,929
|
|
|
$
|
1,965
|
|
Deposits – restricted
|
|
$
|
330
|
|
|
$
|
—
|
|
Other assets
|
|
$
|
63
|
|
|
$
|
102
|
|
(Income) loss from investments in unconsolidated entities:
|
|
|
|
|
||||
Investments in unconsolidated entities
|
|
$
|
(16,309
|
)
|
|
$
|
7,684
|
|
Other liabilities
|
|
$
|
1,921
|
|
|
$
|
2,517
|
|
Distributions from unconsolidated entities – return on capital:
|
|
|
|
|
||||
Investments in unconsolidated entities
|
|
$
|
3,462
|
|
|
$
|
4,399
|
|
Other liabilities
|
|
$
|
102
|
|
|
$
|
158
|
|
Realized/unrealized loss (gain) on derivative instruments:
|
|
|
|
|
||||
Other assets
|
|
$
|
(9,677
|
)
|
|
$
|
11,409
|
|
Notes, net
|
|
$
|
8,162
|
|
|
$
|
(2,485
|
)
|
Other liabilities
|
|
$
|
2,774
|
|
|
$
|
12,794
|
|
Accumulated other comprehensive income
|
|
$
|
1,796
|
|
|
$
|
(21,784
|
)
|
Interest capitalized for real estate and unconsolidated entities under development:
|
|
|
|
|
||||
Investment in real estate, net
|
|
$
|
(45,850
|
)
|
|
$
|
(38,086
|
)
|
Investments in unconsolidated entities
|
|
$
|
—
|
|
|
$
|
(54
|
)
|
Investments in unconsolidated entities:
|
|
|
|
|
||||
Investments in unconsolidated entities
|
|
$
|
(1,383
|
)
|
|
$
|
(5,118
|
)
|
Other liabilities
|
|
$
|
(21,615
|
)
|
|
$
|
(9,450
|
)
|
Other:
|
|
|
|
|
||||
Foreign currency translation adjustments
|
|
$
|
311
|
|
|
$
|
466
|
|
|
|
Nine Months Ended
|
||
|
|
September 30, 2015
|
||
SHAREHOLDERS’ EQUITY
|
|
|
||
|
|
|
||
PREFERRED SHARES
|
|
|
||
Balance, beginning of year
|
|
$
|
50,000
|
|
Partial redemption of 8.29% Series K Cumulative Redeemable
|
|
(9,820
|
)
|
|
Balance, end of period
|
|
$
|
40,180
|
|
|
|
|
||
COMMON SHARES, $0.01 PAR VALUE
|
|
|
||
Balance, beginning of year
|
|
$
|
3,629
|
|
Conversion of OP Units into Common Shares
|
|
2
|
|
|
Exercise of share options
|
|
8
|
|
|
Share-based employee compensation expense:
|
|
|
||
Restricted shares
|
|
2
|
|
|
Balance, end of period
|
|
$
|
3,641
|
|
|
|
|
||
PAID IN CAPITAL
|
|
|
||
Balance, beginning of year
|
|
$
|
8,536,340
|
|
Common Share Issuance:
|
|
|
||
Conversion of OP Units into Common Shares
|
|
4,376
|
|
|
Exercise of share options
|
|
37,039
|
|
|
Employee Share Purchase Plan (ESPP)
|
|
3,376
|
|
|
Conversion of restricted shares to restricted units
|
|
(70
|
)
|
|
Share-based employee compensation expense:
|
|
|
||
Restricted shares
|
|
12,689
|
|
|
Share options
|
|
2,887
|
|
|
ESPP discount
|
|
692
|
|
|
Offering costs
|
|
(69
|
)
|
|
Supplemental Executive Retirement Plan (SERP)
|
|
(1,325
|
)
|
|
Change in market value of Redeemable Noncontrolling Interests – Operating Partnership
|
|
(20,262
|
)
|
|
Adjustment for Noncontrolling Interests ownership in Operating Partnership
|
|
8,470
|
|
|
Balance, end of period
|
|
$
|
8,584,143
|
|
|
|
|
||
RETAINED EARNINGS
|
|
|
||
Balance, beginning of year
|
|
$
|
1,950,639
|
|
Net income attributable to controlling interests
|
|
665,634
|
|
|
Common Share distributions
|
|
(603,337
|
)
|
|
Preferred Share distributions
|
|
(2,557
|
)
|
|
Premium on redemption of Preferred Shares – cash charge
|
|
(2,789
|
)
|
|
Balance, end of period
|
|
$
|
2,007,590
|
|
|
|
Nine Months Ended
|
||
|
|
September 30, 2015
|
||
SHAREHOLDERS’ EQUITY (continued)
|
|
|
||
ACCUMULATED OTHER COMPREHENSIVE (LOSS)
|
|
|
||
Balance, beginning of year
|
|
$
|
(172,152
|
)
|
Accumulated other comprehensive income – derivative instruments:
|
|
|
||
Unrealized holding gains arising during the period
|
|
1,796
|
|
|
Losses reclassified into earnings from other comprehensive income
|
|
13,647
|
|
|
Accumulated other comprehensive (loss) – foreign currency:
|
|
|
||
Currency translation adjustments arising during the period
|
|
(311
|
)
|
|
Balance, end of period
|
|
$
|
(157,020
|
)
|
|
|
|
||
NONCONTROLLING INTERESTS
|
|
|
||
|
|
|
||
OPERATING PARTNERSHIP
|
|
|
||
Balance, beginning of year
|
|
$
|
214,411
|
|
Issuance of restricted units to Noncontrolling Interests
|
|
3
|
|
|
Conversion of OP Units held by Noncontrolling Interests into OP Units held by General Partner
|
|
(4,378
|
)
|
|
Conversion of restricted shares to restricted units
|
|
70
|
|
|
Equity compensation associated with Noncontrolling Interests
|
|
18,969
|
|
|
Net income attributable to Noncontrolling Interests
|
|
26,191
|
|
|
Distributions to Noncontrolling Interests
|
|
(23,719
|
)
|
|
Change in carrying value of Redeemable Noncontrolling Interests – Operating Partnership
|
|
(1,590
|
)
|
|
Adjustment for Noncontrolling Interests ownership in Operating Partnership
|
|
(8,470
|
)
|
|
Balance, end of period
|
|
$
|
221,487
|
|
|
|
|
||
PARTIALLY OWNED PROPERTIES
|
|
|
||
Balance, beginning of year
|
|
$
|
124,909
|
|
Net income attributable to Noncontrolling Interests
|
|
2,473
|
|
|
Distributions to Noncontrolling Interests
|
|
(5,389
|
)
|
|
Deconsolidation of previously consolidated Noncontrolling Interests
|
|
(117,350
|
)
|
|
Balance, end of period
|
|
$
|
4,643
|
|
|
|
September 30,
2015 |
|
December 31,
2014 |
||||
ASSETS
|
|
|
|
|
||||
Investment in real estate
|
|
|
|
|
||||
Land
|
|
$
|
6,424,887
|
|
|
$
|
6,295,404
|
|
Depreciable property
|
|
20,540,247
|
|
|
19,851,504
|
|
||
Projects under development
|
|
1,039,657
|
|
|
1,343,919
|
|
||
Land held for development
|
|
154,690
|
|
|
184,556
|
|
||
Investment in real estate
|
|
28,159,481
|
|
|
27,675,383
|
|
||
Accumulated depreciation
|
|
(5,914,695
|
)
|
|
(5,432,805
|
)
|
||
Investment in real estate, net
|
|
22,244,786
|
|
|
22,242,578
|
|
||
Cash and cash equivalents
|
|
37,366
|
|
|
40,080
|
|
||
Investments in unconsolidated entities
|
|
74,108
|
|
|
105,434
|
|
||
Deposits – restricted
|
|
135,674
|
|
|
72,303
|
|
||
Escrow deposits – mortgage
|
|
54,071
|
|
|
48,085
|
|
||
Deferred financing costs, net
|
|
57,001
|
|
|
58,380
|
|
||
Other assets
|
|
405,798
|
|
|
383,754
|
|
||
Total assets
|
|
$
|
23,008,804
|
|
|
$
|
22,950,614
|
|
|
|
|
|
|
||||
LIABILITIES AND CAPITAL
|
|
|
|
|
||||
Liabilities:
|
|
|
|
|
||||
Mortgage notes payable
|
|
$
|
4,891,529
|
|
|
$
|
5,086,515
|
|
Notes, net
|
|
5,881,794
|
|
|
5,425,346
|
|
||
Line of credit and commercial paper
|
|
29,996
|
|
|
333,000
|
|
||
Accounts payable and accrued expenses
|
|
253,027
|
|
|
153,590
|
|
||
Accrued interest payable
|
|
86,083
|
|
|
89,540
|
|
||
Other liabilities
|
|
353,106
|
|
|
389,915
|
|
||
Security deposits
|
|
76,934
|
|
|
75,633
|
|
||
Distributions payable
|
|
209,086
|
|
|
188,566
|
|
||
Total liabilities
|
|
11,781,555
|
|
|
11,742,105
|
|
||
|
|
|
|
|
||||
Commitments and contingencies
|
|
|
|
|
||||
|
|
|
|
|
||||
Redeemable Limited Partners
|
|
522,585
|
|
|
500,733
|
|
||
Capital:
|
|
|
|
|
||||
Partners' Capital:
|
|
|
|
|
||||
Preference Units
|
|
40,180
|
|
|
50,000
|
|
||
General Partner
|
|
10,595,374
|
|
|
10,490,608
|
|
||
Limited Partners
|
|
221,487
|
|
|
214,411
|
|
||
Accumulated other comprehensive (loss)
|
|
(157,020
|
)
|
|
(172,152
|
)
|
||
Total partners' capital
|
|
10,700,021
|
|
|
10,582,867
|
|
||
Noncontrolling Interests – Partially Owned Properties
|
|
4,643
|
|
|
124,909
|
|
||
Total capital
|
|
10,704,664
|
|
|
10,707,776
|
|
||
Total liabilities and capital
|
|
$
|
23,008,804
|
|
|
$
|
22,950,614
|
|
|
|
Nine Months Ended September 30,
|
|
Quarter Ended September 30,
|
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
REVENUES
|
|
|
|
|
|
|
|
|
||||||||
Rental income
|
|
$
|
2,035,359
|
|
|
$
|
1,942,492
|
|
|
$
|
694,245
|
|
|
$
|
662,001
|
|
Fee and asset management
|
|
6,413
|
|
|
7,596
|
|
|
2,044
|
|
|
2,077
|
|
||||
Total revenues
|
|
2,041,772
|
|
|
1,950,088
|
|
|
696,289
|
|
|
664,078
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
EXPENSES
|
|
|
|
|
|
|
|
|
||||||||
Property and maintenance
|
|
364,948
|
|
|
361,087
|
|
|
122,383
|
|
|
120,139
|
|
||||
Real estate taxes and insurance
|
|
254,513
|
|
|
245,717
|
|
|
84,962
|
|
|
80,568
|
|
||||
Property management
|
|
60,887
|
|
|
61,080
|
|
|
18,925
|
|
|
18,407
|
|
||||
Fee and asset management
|
|
3,764
|
|
|
4,293
|
|
|
1,169
|
|
|
1,253
|
|
||||
Depreciation
|
|
584,862
|
|
|
565,772
|
|
|
196,059
|
|
|
190,469
|
|
||||
General and administrative
|
|
50,942
|
|
|
41,296
|
|
|
15,290
|
|
|
9,968
|
|
||||
Total expenses
|
|
1,319,916
|
|
|
1,279,245
|
|
|
438,788
|
|
|
420,804
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating income
|
|
721,856
|
|
|
670,843
|
|
|
257,501
|
|
|
243,274
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Interest and other income
|
|
6,906
|
|
|
3,213
|
|
|
256
|
|
|
576
|
|
||||
Other expenses
|
|
(2,839
|
)
|
|
(7,179
|
)
|
|
(1,139
|
)
|
|
(4,976
|
)
|
||||
Interest:
|
|
|
|
|
|
|
|
|
||||||||
Expense incurred, net
|
|
(333,622
|
)
|
|
(347,224
|
)
|
|
(114,205
|
)
|
|
(118,251
|
)
|
||||
Amortization of deferred financing costs
|
|
(7,734
|
)
|
|
(8,554
|
)
|
|
(2,607
|
)
|
|
(2,628
|
)
|
||||
Income before income and other taxes, income (loss) from investments
in unconsolidated entities, net gain (loss) on sales of real estate properties and land parcels and discontinued operations |
|
384,567
|
|
|
311,099
|
|
|
139,806
|
|
|
117,995
|
|
||||
Income and other tax (expense) benefit
|
|
(698
|
)
|
|
(1,146
|
)
|
|
(329
|
)
|
|
(260
|
)
|
||||
Income (loss) from investments in unconsolidated entities
|
|
14,388
|
|
|
(10,201
|
)
|
|
(1,041
|
)
|
|
(1,176
|
)
|
||||
Net gain on sales of real estate properties
|
|
295,692
|
|
|
128,544
|
|
|
66,939
|
|
|
113,641
|
|
||||
Net (loss) gain on sales of land parcels
|
|
(1
|
)
|
|
1,846
|
|
|
—
|
|
|
1,052
|
|
||||
Income from continuing operations
|
|
693,948
|
|
|
430,142
|
|
|
205,375
|
|
|
231,252
|
|
||||
Discontinued operations, net
|
|
350
|
|
|
1,500
|
|
|
81
|
|
|
(62
|
)
|
||||
Net income
|
|
694,298
|
|
|
431,642
|
|
|
205,456
|
|
|
231,190
|
|
||||
Net (income) attributable to Noncontrolling Interests – Partially
Owned Properties |
|
(2,473
|
)
|
|
(1,800
|
)
|
|
(986
|
)
|
|
(708
|
)
|
||||
Net income attributable to controlling interests
|
|
$
|
691,825
|
|
|
$
|
429,842
|
|
|
$
|
204,470
|
|
|
$
|
230,482
|
|
|
|
|
|
|
|
|
|
|
||||||||
ALLOCATION OF NET INCOME:
|
|
|
|
|
|
|
|
|
||||||||
Preference Units
|
|
$
|
2,557
|
|
|
$
|
3,109
|
|
|
$
|
833
|
|
|
$
|
1,037
|
|
Premium on redemption of Preference Units
|
|
$
|
2,789
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
General Partner
|
|
$
|
660,288
|
|
|
$
|
410,460
|
|
|
$
|
195,859
|
|
|
$
|
220,707
|
|
Limited Partners
|
|
26,191
|
|
|
16,273
|
|
|
7,778
|
|
|
8,738
|
|
||||
Net income available to Units
|
|
$
|
686,479
|
|
|
$
|
426,733
|
|
|
$
|
203,637
|
|
|
$
|
229,445
|
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per Unit – basic:
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations available to Units
|
|
$
|
1.82
|
|
|
$
|
1.13
|
|
|
$
|
0.54
|
|
|
$
|
0.61
|
|
Net income available to Units
|
|
$
|
1.82
|
|
|
$
|
1.14
|
|
|
$
|
0.54
|
|
|
$
|
0.61
|
|
Weighted average Units outstanding
|
|
376,970
|
|
|
374,626
|
|
|
377,147
|
|
|
375,116
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Earnings per Unit – diluted:
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations available to Units
|
|
$
|
1.80
|
|
|
$
|
1.13
|
|
|
$
|
0.53
|
|
|
$
|
0.61
|
|
Net income available to Units
|
|
$
|
1.80
|
|
|
$
|
1.13
|
|
|
$
|
0.53
|
|
|
$
|
0.61
|
|
Weighted average Units outstanding
|
|
380,423
|
|
|
377,228
|
|
|
380,663
|
|
|
377,954
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Distributions declared per Unit outstanding
|
|
$
|
1.6575
|
|
|
$
|
1.50
|
|
|
$
|
0.5525
|
|
|
$
|
0.50
|
|
|
|
Nine Months Ended September 30,
|
|
Quarter Ended September 30,
|
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Comprehensive income:
|
|
|
|
|
|
|
|
|
||||||||
Net income
|
|
$
|
694,298
|
|
|
$
|
431,642
|
|
|
$
|
205,456
|
|
|
$
|
231,190
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income (loss) – derivative instruments:
|
|
|
|
|
|
|
|
|
||||||||
Unrealized holding gains (losses) arising during the period
|
|
1,796
|
|
|
(21,784
|
)
|
|
1,908
|
|
|
97
|
|
||||
Losses reclassified into earnings from other comprehensive income
|
|
13,647
|
|
|
12,606
|
|
|
4,736
|
|
|
4,271
|
|
||||
Other comprehensive (loss) income – foreign currency:
|
|
|
|
|
|
|
|
|
||||||||
Currency translation adjustments arising during the period
|
|
(311
|
)
|
|
(466
|
)
|
|
191
|
|
|
(2,184
|
)
|
||||
Other comprehensive income (loss)
|
|
15,132
|
|
|
(9,644
|
)
|
|
6,835
|
|
|
2,184
|
|
||||
Comprehensive income
|
|
709,430
|
|
|
421,998
|
|
|
212,291
|
|
|
233,374
|
|
||||
Comprehensive (income) attributable to Noncontrolling Interests –
Partially Owned Properties |
|
(2,473
|
)
|
|
(1,800
|
)
|
|
(986
|
)
|
|
(708
|
)
|
||||
Comprehensive income attributable to controlling interests
|
|
$
|
706,957
|
|
|
$
|
420,198
|
|
|
$
|
211,305
|
|
|
$
|
232,666
|
|
|
|
Nine Months Ended September 30,
|
||||||
|
|
2015
|
|
2014
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
||||
Net income
|
|
$
|
694,298
|
|
|
$
|
431,642
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
||||
Depreciation
|
|
584,862
|
|
|
565,772
|
|
||
Amortization of deferred financing costs
|
|
7,734
|
|
|
8,554
|
|
||
Amortization of above/below market leases
|
|
2,534
|
|
|
2,376
|
|
||
Amortization of discounts and premiums on debt
|
|
(7,718
|
)
|
|
(8,750
|
)
|
||
Amortization of deferred settlements on derivative instruments
|
|
13,483
|
|
|
12,205
|
|
||
Write-off of pursuit costs
|
|
2,322
|
|
|
2,067
|
|
||
(Income) loss from investments in unconsolidated entities
|
|
(14,388
|
)
|
|
10,201
|
|
||
Distributions from unconsolidated entities – return on capital
|
|
3,564
|
|
|
4,557
|
|
||
Net (gain) on sale of investment securities
|
|
(387
|
)
|
|
(57
|
)
|
||
Net (gain) on sales of real estate properties
|
|
(295,692
|
)
|
|
(128,544
|
)
|
||
Net loss (gain) on sales of land parcels
|
|
1
|
|
|
(1,846
|
)
|
||
Net (gain) on sales of discontinued operations
|
|
—
|
|
|
(223
|
)
|
||
Realized/unrealized loss (gain) on derivative instruments
|
|
3,055
|
|
|
(66
|
)
|
||
Compensation paid with Company Common Shares
|
|
29,269
|
|
|
24,647
|
|
||
Changes in assets and liabilities:
|
|
|
|
|
||||
(Increase) in deposits – restricted
|
|
(1,268
|
)
|
|
(2,223
|
)
|
||
Decrease in mortgage deposits
|
|
756
|
|
|
1,638
|
|
||
(Increase) decrease in other assets
|
|
(25,428
|
)
|
|
3,854
|
|
||
Increase in accounts payable and accrued expenses
|
|
63,385
|
|
|
76,331
|
|
||
(Decrease) increase in accrued interest payable
|
|
(3,457
|
)
|
|
8,163
|
|
||
Increase (decrease) in other liabilities
|
|
5,120
|
|
|
(173
|
)
|
||
Increase in security deposits
|
|
1,301
|
|
|
4,146
|
|
||
Net cash provided by operating activities
|
|
1,063,346
|
|
|
1,014,271
|
|
||
|
|
|
|
|
||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
||||
Investment in real estate – acquisitions
|
|
(159,575
|
)
|
|
(404,658
|
)
|
||
Investment in real estate – development/other
|
|
(485,758
|
)
|
|
(380,691
|
)
|
||
Capital expenditures to real estate
|
|
(134,438
|
)
|
|
(133,181
|
)
|
||
Non-real estate capital additions
|
|
(2,384
|
)
|
|
(2,446
|
)
|
||
Interest capitalized for real estate and unconsolidated entities under development
|
|
(45,850
|
)
|
|
(38,140
|
)
|
||
Proceeds from disposition of real estate, net
|
|
457,499
|
|
|
224,538
|
|
||
Investments in unconsolidated entities
|
|
(22,998
|
)
|
|
(14,568
|
)
|
||
Distributions from unconsolidated entities – return of capital
|
|
45,245
|
|
|
77,042
|
|
||
Proceeds from sale of investment securities
|
|
387
|
|
|
57
|
|
||
(Increase) decrease in deposits on real estate acquisitions and investments, net
|
|
(62,433
|
)
|
|
20,845
|
|
||
(Increase) decrease in mortgage deposits
|
|
(407
|
)
|
|
560
|
|
||
Net cash (used for) investing activities
|
|
(410,712
|
)
|
|
(650,642
|
)
|
|
|
Nine Months Ended September 30,
|
||||||
|
|
2015
|
|
2014
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
||||
Debt financing costs
|
|
$
|
(6,355
|
)
|
|
$
|
(10,598
|
)
|
Mortgage deposits
|
|
(6,335
|
)
|
|
(5,557
|
)
|
||
Mortgage notes payable:
|
|
|
|
|
||||
Lump sum payoffs
|
|
(177,564
|
)
|
|
(63,772
|
)
|
||
Scheduled principal repayments
|
|
(7,161
|
)
|
|
(8,919
|
)
|
||
Notes, net:
|
|
|
|
|
||||
Proceeds
|
|
746,391
|
|
|
1,194,278
|
|
||
Lump sum payoffs
|
|
(300,000
|
)
|
|
(1,250,000
|
)
|
||
Line of credit and commercial paper:
|
|
|
|
|
||||
Line of credit proceeds
|
|
3,569,000
|
|
|
5,324,000
|
|
||
Line of credit repayments
|
|
(3,902,000
|
)
|
|
(4,993,000
|
)
|
||
Commercial paper proceeds
|
|
2,491,848
|
|
|
—
|
|
||
Commercial paper repayments
|
|
(2,462,500
|
)
|
|
—
|
|
||
(Payments on) settlement of derivative instruments
|
|
(13,938
|
)
|
|
(758
|
)
|
||
Proceeds from EQR's Employee Share Purchase Plan (ESPP)
|
|
3,376
|
|
|
2,728
|
|
||
Proceeds from exercise of EQR options
|
|
37,047
|
|
|
56,554
|
|
||
OP Units repurchased and retired
|
|
—
|
|
|
(1,777
|
)
|
||
Redemption of Preference Units
|
|
(9,820
|
)
|
|
—
|
|
||
Premium on redemption of Preference Units
|
|
(2,789
|
)
|
|
—
|
|
||
Payment of offering costs
|
|
(69
|
)
|
|
—
|
|
||
Other financing activities, net
|
|
(33
|
)
|
|
(33
|
)
|
||
Acquisition of Noncontrolling Interests – Partially Owned Properties
|
|
—
|
|
|
(5,501
|
)
|
||
Contributions – Noncontrolling Interests – Partially Owned Properties
|
|
—
|
|
|
5,684
|
|
||
Contributions – Limited Partners
|
|
3
|
|
|
3
|
|
||
Distributions:
|
|
|
|
|
||||
OP Units – General Partner
|
|
(583,568
|
)
|
|
(595,564
|
)
|
||
Preference Units
|
|
(2,557
|
)
|
|
(3,109
|
)
|
||
OP Units – Limited Partners
|
|
(22,968
|
)
|
|
(23,582
|
)
|
||
Noncontrolling Interests – Partially Owned Properties
|
|
(5,356
|
)
|
|
(6,762
|
)
|
||
Net cash (used for) financing activities
|
|
(655,348
|
)
|
|
(385,685
|
)
|
||
Net (decrease) in cash and cash equivalents
|
|
(2,714
|
)
|
|
(22,056
|
)
|
||
Cash and cash equivalents, beginning of period
|
|
40,080
|
|
|
53,534
|
|
||
Cash and cash equivalents, end of period
|
|
$
|
37,366
|
|
|
$
|
31,478
|
|
|
|
Nine Months Ended September 30,
|
||||||
|
|
2015
|
|
2014
|
||||
SUPPLEMENTAL INFORMATION:
|
|
|
|
|
||||
Cash paid for interest, net of amounts capitalized
|
|
$
|
328,400
|
|
|
$
|
335,646
|
|
Net cash paid for income and other taxes
|
|
$
|
1,052
|
|
|
$
|
866
|
|
Amortization of discounts and premiums on debt:
|
|
|
|
|
||||
Mortgage notes payable
|
|
$
|
(10,261
|
)
|
|
$
|
(10,515
|
)
|
Notes, net
|
|
$
|
1,895
|
|
|
$
|
1,765
|
|
Line of credit and commercial paper
|
|
$
|
648
|
|
|
$
|
—
|
|
Amortization of deferred settlements on derivative instruments:
|
|
|
|
|
||||
Other liabilities
|
|
$
|
(164
|
)
|
|
$
|
(401
|
)
|
Accumulated other comprehensive income
|
|
$
|
13,647
|
|
|
$
|
12,606
|
|
Write-off of pursuit costs:
|
|
|
|
|
||||
Investment in real estate, net
|
|
$
|
1,929
|
|
|
$
|
1,965
|
|
Deposits – restricted
|
|
$
|
330
|
|
|
$
|
—
|
|
Other assets
|
|
$
|
63
|
|
|
$
|
102
|
|
(Income) loss from investments in unconsolidated entities:
|
|
|
|
|
||||
Investments in unconsolidated entities
|
|
$
|
(16,309
|
)
|
|
$
|
7,684
|
|
Other liabilities
|
|
$
|
1,921
|
|
|
$
|
2,517
|
|
Distributions from unconsolidated entities – return on capital:
|
|
|
|
|
||||
Investments in unconsolidated entities
|
|
$
|
3,462
|
|
|
$
|
4,399
|
|
Other liabilities
|
|
$
|
102
|
|
|
$
|
158
|
|
Realized/unrealized loss (gain) on derivative instruments:
|
|
|
|
|
||||
Other assets
|
|
$
|
(9,677
|
)
|
|
$
|
11,409
|
|
Notes, net
|
|
$
|
8,162
|
|
|
$
|
(2,485
|
)
|
Other liabilities
|
|
$
|
2,774
|
|
|
$
|
12,794
|
|
Accumulated other comprehensive income
|
|
$
|
1,796
|
|
|
$
|
(21,784
|
)
|
Interest capitalized for real estate and unconsolidated entities under development:
|
|
|
|
|
||||
Investment in real estate, net
|
|
$
|
(45,850
|
)
|
|
$
|
(38,086
|
)
|
Investments in unconsolidated entities
|
|
$
|
—
|
|
|
$
|
(54
|
)
|
Investments in unconsolidated entities:
|
|
|
|
|
||||
Investments in unconsolidated entities
|
|
$
|
(1,383
|
)
|
|
$
|
(5,118
|
)
|
Other liabilities
|
|
$
|
(21,615
|
)
|
|
$
|
(9,450
|
)
|
Other:
|
|
|
|
|
||||
Foreign currency translation adjustments
|
|
$
|
311
|
|
|
$
|
466
|
|
|
|
Nine Months Ended
|
||
|
|
September 30, 2015
|
||
PARTNERS' CAPITAL
|
|
|
||
|
|
|
||
PREFERENCE UNITS
|
|
|
||
Balance, beginning of year
|
|
$
|
50,000
|
|
Partial redemption of 8.29% Series K Cumulative Redeemable
|
|
(9,820
|
)
|
|
Balance, end of period
|
|
$
|
40,180
|
|
|
|
|
||
GENERAL PARTNER
|
|
|
||
Balance, beginning of year
|
|
$
|
10,490,608
|
|
OP Unit Issuance:
|
|
|
||
Conversion of OP Units held by Limited Partners into OP Units held by General Partner
|
|
4,378
|
|
|
Exercise of EQR share options
|
|
37,047
|
|
|
EQR's Employee Share Purchase Plan (ESPP)
|
|
3,376
|
|
|
Conversion of EQR restricted shares to restricted units
|
|
(70
|
)
|
|
Share-based employee compensation expense:
|
|
|
||
EQR restricted shares
|
|
12,691
|
|
|
EQR share options
|
|
2,887
|
|
|
EQR ESPP discount
|
|
692
|
|
|
Net income available to Units – General Partner
|
|
660,288
|
|
|
OP Units – General Partner distributions
|
|
(603,337
|
)
|
|
Offering costs
|
|
(69
|
)
|
|
Supplemental Executive Retirement Plan (SERP)
|
|
(1,325
|
)
|
|
Change in market value of Redeemable Limited Partners
|
|
(20,262
|
)
|
|
Adjustment for Limited Partners ownership in Operating Partnership
|
|
8,470
|
|
|
Balance, end of period
|
|
$
|
10,595,374
|
|
|
|
|
||
LIMITED PARTNERS
|
|
|
||
Balance, beginning of year
|
|
$
|
214,411
|
|
Issuance of restricted units to Limited Partners
|
|
3
|
|
|
Conversion of OP Units held by Limited Partners into OP Units held by General Partner
|
|
(4,378
|
)
|
|
Conversion of EQR restricted shares to restricted units
|
|
70
|
|
|
Equity compensation associated with Units – Limited Partners
|
|
18,969
|
|
|
Net income available to Units – Limited Partners
|
|
26,191
|
|
|
Units – Limited Partners distributions
|
|
(23,719
|
)
|
|
Change in carrying value of Redeemable Limited Partners
|
|
(1,590
|
)
|
|
Adjustment for Limited Partners ownership in Operating Partnership
|
|
(8,470
|
)
|
|
Balance, end of period
|
|
$
|
221,487
|
|
|
|
|
||
ACCUMULATED OTHER COMPREHENSIVE (LOSS)
|
|
|
||
Balance, beginning of year
|
|
$
|
(172,152
|
)
|
Accumulated other comprehensive income – derivative instruments:
|
|
|
||
Unrealized holding gains arising during the period
|
|
1,796
|
|
|
Losses reclassified into earnings from other comprehensive income
|
|
13,647
|
|
|
Accumulated other comprehensive (loss) – foreign currency:
|
|
|
||
Currency translation adjustments arising during the period
|
|
(311
|
)
|
|
Balance, end of period
|
|
$
|
(157,020
|
)
|
|
|
Nine Months Ended
|
||
|
|
September 30, 2015
|
||
NONCONTROLLING INTERESTS
|
|
|
||
|
|
|
||
NONCONTROLLING INTERESTS – PARTIALLY OWNED PROPERTIES
|
|
|
||
Balance, beginning of year
|
|
$
|
124,909
|
|
Net income attributable to Noncontrolling Interests
|
|
2,473
|
|
|
Distributions to Noncontrolling Interests
|
|
(5,389
|
)
|
|
Deconsolidation of previously consolidated Noncontrolling Interests
|
|
(117,350
|
)
|
|
Balance, end of period
|
|
$
|
4,643
|
|
1.
|
Business
|
|
|
Properties
|
|
Apartment
Units |
||
Wholly Owned Properties
|
|
365
|
|
|
98,331
|
|
Master-Leased Properties – Consolidated
|
|
3
|
|
|
853
|
|
Partially Owned Properties – Consolidated
|
|
19
|
|
|
3,771
|
|
Partially Owned Properties – Unconsolidated
|
|
3
|
|
|
1,281
|
|
Military Housing
|
|
2
|
|
|
5,111
|
|
|
|
392
|
|
|
109,347
|
|
2.
|
Summary of Significant Accounting Policies
|
3.
|
Equity, Capital and Other Interests
|
|
|
2015
|
|
Common Shares
|
|
|
|
Common Shares outstanding at January 1,
|
|
362,855,454
|
|
Common Shares Issued:
|
|
|
|
Conversion of OP Units
|
|
181,753
|
|
Exercise of share options
|
|
882,764
|
|
Employee Share Purchase Plan (ESPP)
|
|
52,869
|
|
Restricted share grants, net
|
|
168,484
|
|
Common Shares Other:
|
|
|
|
Conversion of restricted shares to restricted units
|
|
(1,284
|
)
|
Common Shares outstanding at September 30,
|
|
364,140,040
|
|
Units
|
|
|
|
Units outstanding at January 1,
|
|
14,298,691
|
|
Restricted units, net
|
|
337,505
|
|
Conversion of restricted shares to restricted units
|
|
1,284
|
|
Conversion of OP Units to Common Shares
|
|
(181,753
|
)
|
Units outstanding at September 30,
|
|
14,455,727
|
|
Total Common Shares and Units outstanding at September 30,
|
|
378,595,767
|
|
Units Ownership Interest in Operating Partnership
|
|
3.8
|
%
|
|
|
2015
|
||
Balance at January 1,
|
|
$
|
500,733
|
|
Change in market value
|
|
20,262
|
|
|
Change in carrying value
|
|
1,590
|
|
|
Balance at September 30,
|
|
$
|
522,585
|
|
|
|
|
|
|
|
Amounts in thousands
|
||||||||
|
|
Redemption
Date (1) |
|
Annual
Dividend per Share (2) |
|
September 30,
2015 |
|
December 31,
2014 |
||||||
Preferred Shares of beneficial interest, $0.01 par value;
100,000,000 shares authorized: |
|
|
|
|
|
|
|
|
||||||
8.29% Series K Cumulative Redeemable Preferred; liquidation
value $50 per share; 803,600 shares issued and outstanding at September 30, 2015 and 1,000,000 shares issued and outstanding at December 31, 2014 (3) |
|
12/10/26
|
|
|
$4.145
|
|
|
$
|
40,180
|
|
|
$
|
50,000
|
|
|
|
|
|
|
|
$
|
40,180
|
|
|
$
|
50,000
|
|
(1)
|
On or after the redemption date, redeemable preferred shares may be redeemed for cash at the option of the Company, in whole or
|
(2)
|
Dividends on Preferred Shares are payable quarterly.
|
(3)
|
Effective January 26, 2015, the Company repurchased and retired
196,400
Series K Preferred Shares with a par value of
$9.82 million
for total cash consideration of approximately
$12.7 million
. As a result of this partial redemption, the Company incurred a cash charge of approximately
$2.8 million
which was recorded as a premium on the redemption of Preferred Shares.
|
|
|
|
|
|
|
2015
|
|
General and Limited Partner Units
|
|
|
|
General and Limited Partner Units outstanding at January 1,
|
|
377,154,145
|
|
Issued to General Partner:
|
|
|
|
Exercise of EQR share options
|
|
882,764
|
|
EQR’s Employee Share Purchase Plan (ESPP)
|
|
52,869
|
|
EQR's restricted share grants, net
|
|
168,484
|
|
Issued to Limited Partners:
|
|
|
|
Restricted units, net
|
|
337,505
|
|
General and Limited Partner Units outstanding at September 30,
|
|
378,595,767
|
|
Limited Partner Units
|
|
|
|
Limited Partner Units outstanding at January 1,
|
|
14,298,691
|
|
Limited Partner restricted units, net
|
|
337,505
|
|
Conversion of EQR restricted shares to restricted units
|
|
1,284
|
|
Conversion of Limited Partner OP Units to EQR Common Shares
|
|
(181,753
|
)
|
Limited Partner Units outstanding at September 30,
|
|
14,455,727
|
|
Limited Partner Units Ownership Interest in Operating Partnership
|
|
3.8
|
%
|
|
|
2015
|
||
Balance at January 1,
|
|
$
|
500,733
|
|
Change in market value
|
|
20,262
|
|
|
Change in carrying value
|
|
1,590
|
|
|
Balance at September 30,
|
|
$
|
522,585
|
|
|
|
|
|
|
|
Amounts in thousands
|
||||||||
|
|
Redemption
Date (1)
|
|
Annual
Dividend per Unit (2) |
|
September 30,
2015 |
|
December 31,
2014 |
||||||
Preference Units:
|
|
|
|
|
|
|
|
|
||||||
8.29% Series K Cumulative Redeemable Preference Units;
liquidation value $50 per unit; 803,600 units issued and outstanding at September 30, 2015 and 1,000,000 units issued and outstanding at December 31, 2014 (3) |
|
12/10/26
|
|
|
$4.145
|
|
|
$
|
40,180
|
|
|
$
|
50,000
|
|
|
|
|
|
|
|
$
|
40,180
|
|
|
$
|
50,000
|
|
(1)
|
On or after the redemption date, redeemable preference units may be redeemed for cash at the option of the Operating Partnership, in whole or in part, at a redemption price equal to the liquidation price per unit, plus accrued and unpaid distributions, if any, in conjunction with the concurrent redemption of the corresponding Company Preferred Shares.
|
(2)
|
Dividends on Preference Units are payable quarterly.
|
(3)
|
Effective January 26, 2015, the Operating Partnership repurchased and retired
196,400
Series K Preference Units with a par value of
$9.82 million
for total cash consideration of approximately
$12.7 million
, in conjunction with the concurrent redemption of the corresponding Company Preferred Shares. As a result of this partial redemption, the Operating Partnership incurred a cash charge of approximately
$2.8 million
which was recorded as a premium on the redemption of Preference Units.
|
4.
|
Real Estate and Lease Intangibles
|
|
|
September 30,
2015 |
|
December 31,
2014 |
||||
Land
|
|
$
|
6,424,887
|
|
|
$
|
6,295,404
|
|
Depreciable property:
|
|
|
|
|
||||
Buildings and improvements
|
|
18,527,779
|
|
|
17,974,337
|
|
||
Furniture, fixtures and equipment
|
|
1,497,314
|
|
|
1,365,276
|
|
||
In-Place lease intangibles
|
|
515,154
|
|
|
511,891
|
|
||
Projects under development:
|
|
|
|
|
||||
Land
|
|
295,798
|
|
|
466,764
|
|
||
Construction-in-progress
|
|
743,859
|
|
|
877,155
|
|
||
Land held for development:
|
|
|
|
|
||||
Land
|
|
120,007
|
|
|
145,366
|
|
||
Construction-in-progress
|
|
34,683
|
|
|
39,190
|
|
||
Investment in real estate
|
|
28,159,481
|
|
|
27,675,383
|
|
||
Accumulated depreciation
|
|
(5,914,695
|
)
|
|
(5,432,805
|
)
|
||
Investment in real estate, net
|
|
$
|
22,244,786
|
|
|
$
|
22,242,578
|
|
Description
|
|
Balance Sheet Location
|
|
September 30,
2015 |
|
December 31,
2014 |
||||
Assets
|
|
|
|
|
|
|
||||
Ground lease intangibles – below market
|
|
Other Assets
|
|
$
|
178,251
|
|
|
$
|
178,251
|
|
Retail lease intangibles – above market
|
|
Other Assets
|
|
1,260
|
|
|
1,260
|
|
||
Lease intangible assets
|
|
|
|
179,511
|
|
|
179,511
|
|
||
Accumulated amortization
|
|
|
|
(12,318
|
)
|
|
(8,913
|
)
|
||
Lease intangible assets, net
|
|
|
|
$
|
167,193
|
|
|
$
|
170,598
|
|
|
|
|
|
|
|
|
||||
Liabilities
|
|
|
|
|
|
|
||||
Ground lease intangibles – above market
|
|
Other Liabilities
|
|
$
|
2,400
|
|
|
$
|
2,400
|
|
Retail lease intangibles – below market
|
|
Other Liabilities
|
|
5,270
|
|
|
5,270
|
|
||
Lease intangible liabilities
|
|
|
|
7,670
|
|
|
7,670
|
|
||
Accumulated amortization
|
|
|
|
(3,129
|
)
|
|
(2,258
|
)
|
||
Lease intangible liabilities, net
|
|
|
|
$
|
4,541
|
|
|
$
|
5,412
|
|
|
|
Remaining
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Ground lease intangibles
|
|
$
|
1,080
|
|
|
$
|
4,321
|
|
|
$
|
4,321
|
|
|
$
|
4,321
|
|
|
$
|
4,321
|
|
|
$
|
4,321
|
|
Retail lease intangibles
|
|
(232
|
)
|
|
(896
|
)
|
|
(540
|
)
|
|
(71
|
)
|
|
(71
|
)
|
|
(71
|
)
|
||||||
Total
|
|
$
|
848
|
|
|
$
|
3,425
|
|
|
$
|
3,781
|
|
|
$
|
4,250
|
|
|
$
|
4,250
|
|
|
$
|
4,250
|
|
|
|
Properties
|
|
Apartment Units
|
|
Purchase Price
|
||||
Rental Properties
|
|
1
|
|
|
202
|
|
|
$
|
130,275
|
|
Land Parcels (1)
|
|
—
|
|
|
—
|
|
|
27,800
|
|
|
Total
|
|
1
|
|
|
202
|
|
|
$
|
158,075
|
|
|
|
Properties
|
|
Apartment Units
|
|
Sales Price
|
||||
Rental Properties (1)
|
|
7
|
|
|
1,707
|
|
|
$
|
464,812
|
|
Total
|
|
7
|
|
|
1,707
|
|
|
$
|
464,812
|
|
5.
|
Commitments to Acquire/Dispose of Real Estate
|
|
|
Properties
|
|
Apartment Units
|
|
Purchase Price
|
||||
Other
|
|
—
|
|
|
2
|
|
|
$
|
6,000
|
|
Total
|
|
—
|
|
|
2
|
|
|
$
|
6,000
|
|
|
|
Properties
|
|
Apartment Units
|
|
Sales Price
|
||||
Rental Properties (1)
|
|
77
|
|
|
23,961
|
|
|
$
|
5,830,203
|
|
Land Parcels (three)
|
|
—
|
|
|
—
|
|
|
29,900
|
|
|
Total
|
|
77
|
|
|
23,961
|
|
|
$
|
5,860,103
|
|
|
|
Consolidated
|
|
Unconsolidated
|
||||
|
|
Operating
|
|
Operating
|
||||
|
|
|
|
|
||||
Total projects
|
|
19
|
|
|
3
|
|
||
|
|
|
|
|
||||
Total apartment units
|
|
3,771
|
|
|
1,281
|
|
||
|
|
|
|
|
||||
Balance sheet information at 9/30/15 (at 100%):
|
|
|
|
|
||||
ASSETS
|
|
|
|
|
||||
Investment in real estate
|
|
$
|
687,814
|
|
|
$
|
290,733
|
|
Accumulated depreciation
|
|
(211,120
|
)
|
|
(27,563
|
)
|
||
Investment in real estate, net
|
|
476,694
|
|
|
263,170
|
|
||
Cash and cash equivalents
|
|
19,242
|
|
|
8,912
|
|
||
Investments in unconsolidated entities
|
|
50,140
|
|
|
—
|
|
||
Deposits – restricted
|
|
335
|
|
|
284
|
|
||
Deferred financing costs, net
|
|
1,875
|
|
|
6
|
|
||
Other assets
|
|
26,816
|
|
|
882
|
|
||
Total assets
|
|
$
|
575,102
|
|
|
$
|
273,254
|
|
|
|
|
|
|
||||
LIABILITIES AND EQUITY/CAPITAL
|
|
|
|
|
||||
Mortgage notes payable (1)
|
|
$
|
343,341
|
|
|
$
|
174,992
|
|
Accounts payable & accrued expenses
|
|
3,318
|
|
|
3,227
|
|
||
Accrued interest payable
|
|
1,206
|
|
|
691
|
|
||
Other liabilities
|
|
709
|
|
|
513
|
|
||
Security deposits
|
|
2,017
|
|
|
614
|
|
||
Total liabilities
|
|
350,591
|
|
|
180,037
|
|
||
|
|
|
|
|
||||
Noncontrolling Interests – Partially Owned Properties/Partners' equity
|
|
4,643
|
|
|
90,878
|
|
||
Company equity/General and Limited Partners' Capital
|
|
219,868
|
|
|
2,339
|
|
||
Total equity/capital
|
|
224,511
|
|
|
93,217
|
|
||
Total liabilities and equity/capital
|
|
$
|
575,102
|
|
|
$
|
273,254
|
|
|
|
Consolidated
|
|
Unconsolidated
|
||||
|
|
Operating
|
|
Operating
|
||||
Operating information for the nine months ended 9/30/15 (at 100%):
|
|
|
|
|
||||
Operating revenue
|
|
$
|
70,142
|
|
|
$
|
24,125
|
|
Operating expenses
|
|
20,208
|
|
|
8,949
|
|
||
|
|
|
|
|
||||
Net operating income
|
|
49,934
|
|
|
15,176
|
|
||
Depreciation
|
|
16,638
|
|
|
9,251
|
|
||
General and administrative/other
|
|
44
|
|
|
178
|
|
||
|
|
|
|
|
||||
Operating income
|
|
33,252
|
|
|
5,747
|
|
||
Interest and other income
|
|
8
|
|
|
2
|
|
||
Other expenses
|
|
(50
|
)
|
|
—
|
|
||
Interest:
|
|
|
|
|
||||
Expense incurred, net
|
|
(11,704
|
)
|
|
(7,047
|
)
|
||
Amortization of deferred financing costs
|
|
(266
|
)
|
|
(1
|
)
|
||
|
|
|
|
|
||||
Income (loss) before income and other taxes and (loss) from
investments in unconsolidated entities |
|
21,240
|
|
|
(1,299
|
)
|
||
Income and other tax (expense) benefit
|
|
(35
|
)
|
|
(18
|
)
|
||
(Loss) from investments in unconsolidated entities
|
|
(1,104
|
)
|
|
—
|
|
||
|
|
|
|
|
||||
Net income (loss)
|
|
$
|
20,101
|
|
|
$
|
(1,317
|
)
|
(1)
|
All debt is non-recourse to the Company.
|
Note:
|
The above tables exclude the Company's interests in unconsolidated joint ventures entered into with AvalonBay Communities, Inc. (“AVB”) in connection with the acquisition of certain real estate related assets from Archstone Enterprise LP (such assets are referred to herein as "Archstone"). These ventures own certain non-core Archstone assets that are held for sale and succeeded to certain residual Archstone liabilities/litigation, as well as responsibility for tax protection arrangements and third-party preferred interests in former Archstone subsidiaries. The preferred interests had an aggregate liquidation value of
$42.8 million
at
September 30, 2015
. The ventures are owned
60%
by the Company and
40%
by AVB.
|
|
|
September 30,
2015 |
|
December 31,
2014 |
||||
Tax-deferred (1031) exchange proceeds
|
|
$
|
77,636
|
|
|
$
|
—
|
|
Earnest money on pending acquisitions
|
|
2,210
|
|
|
580
|
|
||
Restricted deposits on real estate investments
|
|
7,538
|
|
|
24,701
|
|
||
Resident security and utility deposits
|
|
47,932
|
|
|
46,516
|
|
||
Other
|
|
358
|
|
|
506
|
|
||
Totals
|
|
$
|
135,674
|
|
|
$
|
72,303
|
|
|
|
September 30,
2015 |
|
December 31,
2014 |
||||
Real estate taxes and insurance
|
|
$
|
1,479
|
|
|
$
|
2,235
|
|
Replacement reserves
|
|
3,838
|
|
|
3,431
|
|
||
Mortgage principal reserves/sinking funds
|
|
47,902
|
|
|
41,567
|
|
||
Other
|
|
852
|
|
|
852
|
|
||
Totals
|
|
$
|
54,071
|
|
|
$
|
48,085
|
|
▪
|
Repaid
$300.0 million
of
6.584%
unsecured notes at maturity;
|
▪
|
Issued
$450.0 million
of ten-year
3.375%
fixed rate public notes, receiving net proceeds of
$447.5 million
before underwriting fees, hedge termination costs and other expenses, at an all-in effective interest rate of
3.81%
after termination of various forward starting swaps in conjunction with the issuance (see Note 9 for further discussion); and
|
▪
|
Issued
$300.0 million
of thirty-year
4.50%
fixed rate public notes, receiving net proceeds of
$298.9 million
before underwriting fees and other expenses, at an all-in effective interest rate of
4.55%
.
|
9.
|
Derivative and Other Fair Value Instruments
|
•
|
Level 1 – Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.
|
•
|
Level 2 – Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.
|
•
|
Level 3 – Inputs to the valuation methodology are unobservable and significant to the fair value measurement.
|
|
|
Fair Value
Hedges (1) |
|
Forward
Starting Swaps (2) |
||||
Current Notional Balance
|
|
$
|
450,000
|
|
|
$
|
50,000
|
|
Lowest Possible Notional
|
|
$
|
450,000
|
|
|
$
|
50,000
|
|
Highest Possible Notional
|
|
$
|
450,000
|
|
|
$
|
50,000
|
|
Lowest Interest Rate
|
|
2.375
|
%
|
|
2.500
|
%
|
||
Highest Interest Rate
|
|
2.375
|
%
|
|
2.500
|
%
|
||
Earliest Maturity Date
|
|
2019
|
|
|
2026
|
|
||
Latest Maturity Date
|
|
2019
|
|
|
2026
|
|
(1)
|
Fair Value Hedges – Converts outstanding fixed rate unsecured notes (
$450.0 million
2.375%
notes due
July 1, 2019
) to a floating interest rate of 90-Day LIBOR plus
0.61%
.
|
(2)
|
Forward Starting Swaps – Designed to partially fix interest rates in advance of a planned future debt issuance. This swap has a mandatory counterparty termination in 2017, and is targeted to a 2016 issuance.
|
|
|
|
|
|
|
Fair Value Measurements at Reporting Date Using
|
||||||||||||
Description
|
|
Balance Sheet
Location
|
|
9/30/2015
|
|
Quoted Prices in
Active Markets for
Identical Assets/Liabilities
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
Significant
Unobservable Inputs
(Level 3)
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest Rate Contracts:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fair Value Hedges
|
|
Other Assets
|
|
$
|
9,759
|
|
|
$
|
—
|
|
|
$
|
9,759
|
|
|
$
|
—
|
|
Supplemental Executive Retirement Plan
|
|
Other Assets
|
|
96,823
|
|
|
96,823
|
|
|
—
|
|
|
—
|
|
||||
Total
|
|
|
|
$
|
106,582
|
|
|
$
|
96,823
|
|
|
$
|
9,759
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest Rate Contracts:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Forward Starting Swaps
|
|
Other Liabilities
|
|
$
|
1,095
|
|
|
$
|
—
|
|
|
$
|
1,095
|
|
|
$
|
—
|
|
Supplemental Executive Retirement Plan
|
|
Other Liabilities
|
|
96,823
|
|
|
96,823
|
|
|
—
|
|
|
—
|
|
||||
Total
|
|
|
|
$
|
97,918
|
|
|
$
|
96,823
|
|
|
$
|
1,095
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Redeemable Noncontrolling Interests –
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating Partnership/Redeemable
|
|
|
|
|
|
|
|
|
|
|
||||||||
Limited Partners
|
|
Mezzanine
|
|
$
|
522,585
|
|
|
$
|
—
|
|
|
$
|
522,585
|
|
|
$
|
—
|
|
|
|
|
|
|
|
Fair Value Measurements at Reporting Date Using
|
||||||||||||
Description
|
|
Balance Sheet
Location
|
|
12/31/2014
|
|
Quoted Prices in
Active Markets for
Identical Assets/Liabilities
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
Significant
Unobservable Inputs
(Level 3)
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest Rate Contracts:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fair Value Hedges
|
|
Other Assets
|
|
$
|
1,597
|
|
|
$
|
—
|
|
|
$
|
1,597
|
|
|
$
|
—
|
|
Forward Starting Swaps
|
|
Other Assets
|
|
332
|
|
|
—
|
|
|
332
|
|
|
—
|
|
||||
Supplemental Executive Retirement Plan
|
|
Other Assets
|
|
104,463
|
|
|
104,463
|
|
|
—
|
|
|
—
|
|
||||
Total
|
|
|
|
$
|
106,392
|
|
|
$
|
104,463
|
|
|
$
|
1,929
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest Rate Contracts:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Forward Starting Swaps
|
|
Other Liabilities
|
|
$
|
14,104
|
|
|
$
|
—
|
|
|
$
|
14,104
|
|
|
$
|
—
|
|
Supplemental Executive Retirement Plan
|
|
Other Liabilities
|
|
104,463
|
|
|
104,463
|
|
|
—
|
|
|
—
|
|
||||
Total
|
|
|
|
$
|
118,567
|
|
|
$
|
104,463
|
|
|
$
|
14,104
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Redeemable Noncontrolling Interests –
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating Partnership/Redeemable
|
|
|
|
|
|
|
|
|
|
|
||||||||
Limited Partners
|
|
Mezzanine
|
|
$
|
500,733
|
|
|
$
|
—
|
|
|
$
|
500,733
|
|
|
$
|
—
|
|
September 30, 2015
Type of Fair Value Hedge
|
|
Location of
Gain/(Loss)
Recognized in
Income on
Derivative
|
|
Amount of
Gain/(Loss)
Recognized in
Income on
Derivative
|
|
Hedged Item
|
|
Income Statement
Location of
Hedged Item
Gain/(Loss)
|
|
Amount of
Gain/(Loss)
Recognized in
Income
on Hedged Item
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
||||
Interest Rate Contracts:
|
|
|
|
|
|
|
|
|
|
|
||||
Interest Rate Swaps
|
|
Interest expense
|
|
$
|
8,162
|
|
|
Fixed rate debt
|
|
Interest expense
|
|
$
|
(8,162
|
)
|
Total
|
|
|
|
$
|
8,162
|
|
|
|
|
|
|
$
|
(8,162
|
)
|
September 30, 2014
Type of Fair Value Hedge
|
|
Location of
Gain/(Loss) Recognized in Income on
Derivative
|
|
Amount of
Gain/(Loss) Recognized in Income on
Derivative
|
|
Hedged Item
|
|
Income Statement
Location of Hedged Item Gain/(Loss) |
|
Amount of
Gain/(Loss)
Recognized in
Income
on Hedged Item
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
||||
Interest Rate Contracts:
|
|
|
|
|
|
|
|
|
|
|
||||
Interest Rate Swaps
|
|
Interest expense
|
|
$
|
(2,485
|
)
|
|
Fixed rate debt
|
|
Interest expense
|
|
$
|
2,485
|
|
Total
|
|
|
|
$
|
(2,485
|
)
|
|
|
|
|
|
$
|
2,485
|
|
|
|
Effective Portion
|
|
Ineffective Portion
|
||||||||||||
September 30, 2015
Type of Cash Flow Hedge
|
|
Amount of
Gain/(Loss)
Recognized in
OCI on
Derivative
|
|
Location of Gain/
(Loss)
Reclassified from
Accumulated
OCI into Income
|
|
Amount of Gain/
(Loss) Reclassified from Accumulated OCI into Income |
|
Location of
Gain/(Loss)
Recognized in
Income on
Derivative
|
|
Amount of Gain/
(Loss) Reclassified from Accumulated OCI into Income |
||||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest Rate Contracts:
|
|
|
|
|
|
|
|
|
|
|
||||||
Forward Starting Swaps
|
$
|
(1,237
|
)
|
|
Interest expense
|
|
$
|
(13,647
|
)
|
|
Interest expense
|
|
$
|
(3,033
|
)
|
|
Total
|
|
$
|
(1,237
|
)
|
|
|
|
$
|
(13,647
|
)
|
|
|
|
$
|
(3,033
|
)
|
|
|
Effective Portion
|
|
Ineffective Portion
|
||||||||||||
September 30, 2014
Type of Cash Flow Hedge
|
|
Amount of
Gain/(Loss)
Recognized in
OCI on
Derivative
|
|
Location of Gain/
(Loss)
Reclassified from
Accumulated
OCI into Income
|
|
Amount of Gain/
(Loss) Reclassified from Accumulated OCI into Income |
|
Location of
Gain/(Loss)
Recognized in
Income on
Derivative
|
|
Amount of Gain/
(Loss) Reclassified from Accumulated OCI into Income |
||||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest Rate Contracts:
|
|
|
|
|
|
|
|
|
|
|
||||||
Forward Starting Swaps
|
|
$
|
(21,693
|
)
|
|
Interest expense
|
|
$
|
(12,606
|
)
|
|
Interest expense
|
|
$
|
91
|
|
Total
|
|
$
|
(21,693
|
)
|
|
|
|
$
|
(12,606
|
)
|
|
|
|
$
|
91
|
|
|
|
Nine Months Ended September 30,
|
|
Quarter Ended September 30,
|
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Numerator for net income per share – basic:
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
|
$
|
693,948
|
|
|
$
|
430,142
|
|
|
$
|
205,375
|
|
|
$
|
231,252
|
|
Allocation to Noncontrolling Interests – Operating Partnership, net
|
|
(26,178
|
)
|
|
(16,216
|
)
|
|
(7,775
|
)
|
|
(8,740
|
)
|
||||
Net (income) attributable to Noncontrolling Interests – Partially Owned
Properties |
|
(2,473
|
)
|
|
(1,800
|
)
|
|
(986
|
)
|
|
(708
|
)
|
||||
Preferred distributions
|
|
(2,557
|
)
|
|
(3,109
|
)
|
|
(833
|
)
|
|
(1,037
|
)
|
||||
Premium on redemption of Preferred Shares
|
|
(2,789
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Income from continuing operations available to Common Shares, net of
Noncontrolling Interests |
|
659,951
|
|
|
409,017
|
|
|
195,781
|
|
|
220,767
|
|
||||
Discontinued operations, net of Noncontrolling Interests
|
|
337
|
|
|
1,443
|
|
|
78
|
|
|
(60
|
)
|
||||
Numerator for net income per share – basic
|
|
$
|
660,288
|
|
|
$
|
410,460
|
|
|
$
|
195,859
|
|
|
$
|
220,707
|
|
Numerator for net income per share – diluted:
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
|
$
|
693,948
|
|
|
$
|
430,142
|
|
|
$
|
205,375
|
|
|
$
|
231,252
|
|
Net (income) attributable to Noncontrolling Interests – Partially Owned
Properties |
|
(2,473
|
)
|
|
(1,800
|
)
|
|
(986
|
)
|
|
(708
|
)
|
||||
Preferred distributions
|
|
(2,557
|
)
|
|
(3,109
|
)
|
|
(833
|
)
|
|
(1,037
|
)
|
||||
Premium on redemption of Preferred Shares
|
|
(2,789
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Income from continuing operations available to Common Shares
|
|
686,129
|
|
|
425,233
|
|
|
203,556
|
|
|
229,507
|
|
||||
Discontinued operations, net
|
|
350
|
|
|
1,500
|
|
|
81
|
|
|
(62
|
)
|
||||
Numerator for net income per share – diluted
|
|
$
|
686,479
|
|
|
$
|
426,733
|
|
|
$
|
203,637
|
|
|
$
|
229,445
|
|
Denominator for net income per share – basic and diluted:
|
|
|
|
|
|
|
|
|
||||||||
Denominator for net income per share – basic
|
|
363,386
|
|
|
360,900
|
|
|
363,579
|
|
|
361,409
|
|
||||
Effect of dilutive securities:
|
|
|
|
|
|
|
|
|
||||||||
OP Units
|
|
13,584
|
|
|
13,726
|
|
|
13,568
|
|
|
13,707
|
|
||||
Long-term compensation shares/units
|
|
3,453
|
|
|
2,602
|
|
|
3,516
|
|
|
2,838
|
|
||||
Denominator for net income per share – diluted
|
|
380,423
|
|
|
377,228
|
|
|
380,663
|
|
|
377,954
|
|
||||
Net income per share – basic
|
|
$
|
1.82
|
|
|
$
|
1.14
|
|
|
$
|
0.54
|
|
|
$
|
0.61
|
|
Net income per share – diluted
|
|
$
|
1.80
|
|
|
$
|
1.13
|
|
|
$
|
0.53
|
|
|
$
|
0.61
|
|
Net income per share – basic:
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations available to Common Shares, net of
Noncontrolling Interests |
|
$
|
1.82
|
|
|
$
|
1.13
|
|
|
$
|
0.54
|
|
|
$
|
0.61
|
|
Discontinued operations, net of Noncontrolling Interests
|
|
—
|
|
|
0.01
|
|
|
—
|
|
|
—
|
|
||||
Net income per share – basic
|
|
$
|
1.82
|
|
|
$
|
1.14
|
|
|
$
|
0.54
|
|
|
$
|
0.61
|
|
Net income per share – diluted:
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations available to Common Shares
|
|
$
|
1.80
|
|
|
$
|
1.13
|
|
|
$
|
0.53
|
|
|
$
|
0.61
|
|
Discontinued operations, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net income per share – diluted
|
|
$
|
1.80
|
|
|
$
|
1.13
|
|
|
$
|
0.53
|
|
|
$
|
0.61
|
|
|
|
Nine Months Ended September 30,
|
|
Quarter Ended September 30,
|
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Numerator for net income per Unit – basic and diluted:
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
|
$
|
693,948
|
|
|
$
|
430,142
|
|
|
$
|
205,375
|
|
|
$
|
231,252
|
|
Net (income) attributable to Noncontrolling Interests – Partially Owned
Properties |
|
(2,473
|
)
|
|
(1,800
|
)
|
|
(986
|
)
|
|
(708
|
)
|
||||
Allocation to Preference Units
|
|
(2,557
|
)
|
|
(3,109
|
)
|
|
(833
|
)
|
|
(1,037
|
)
|
||||
Allocation to premium on redemption of Preference Units
|
|
(2,789
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Income from continuing operations available to Units
|
|
686,129
|
|
|
425,233
|
|
|
203,556
|
|
|
229,507
|
|
||||
Discontinued operations, net
|
|
350
|
|
|
1,500
|
|
|
81
|
|
|
(62
|
)
|
||||
Numerator for net income per Unit – basic and diluted
|
|
$
|
686,479
|
|
|
$
|
426,733
|
|
|
$
|
203,637
|
|
|
$
|
229,445
|
|
Denominator for net income per Unit – basic and diluted:
|
|
|
|
|
|
|
|
|
||||||||
Denominator for net income per Unit – basic
|
|
376,970
|
|
|
374,626
|
|
|
377,147
|
|
|
375,116
|
|
||||
Effect of dilutive securities:
|
|
|
|
|
|
|
|
|
||||||||
Dilution for Units issuable upon assumed exercise/vesting of the
Company’s long-term compensation shares/units |
|
3,453
|
|
|
2,602
|
|
|
3,516
|
|
|
2,838
|
|
||||
Denominator for net income per Unit – diluted
|
|
380,423
|
|
|
377,228
|
|
|
380,663
|
|
|
377,954
|
|
||||
Net income per Unit – basic
|
|
$
|
1.82
|
|
|
$
|
1.14
|
|
|
$
|
0.54
|
|
|
$
|
0.61
|
|
Net income per Unit – diluted
|
|
$
|
1.80
|
|
|
$
|
1.13
|
|
|
$
|
0.53
|
|
|
$
|
0.61
|
|
Net income per Unit – basic:
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations available to Units
|
|
$
|
1.82
|
|
|
$
|
1.13
|
|
|
$
|
0.54
|
|
|
$
|
0.61
|
|
Discontinued operations, net
|
|
—
|
|
|
0.01
|
|
|
—
|
|
|
—
|
|
||||
Net income per Unit – basic
|
|
$
|
1.82
|
|
|
$
|
1.14
|
|
|
$
|
0.54
|
|
|
$
|
0.61
|
|
Net income per Unit – diluted:
|
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations available to Units
|
|
$
|
1.80
|
|
|
$
|
1.13
|
|
|
$
|
0.53
|
|
|
$
|
0.61
|
|
Discontinued operations, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net income per Unit – diluted
|
|
$
|
1.80
|
|
|
$
|
1.13
|
|
|
$
|
0.53
|
|
|
$
|
0.61
|
|
11.
|
Discontinued Operations
|
|
|
Nine Months Ended September 30,
|
|
Quarter Ended September 30,
|
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
REVENUES
|
|
|
|
|
|
|
|
|
||||||||
Rental income
|
|
$
|
425
|
|
|
$
|
1,218
|
|
|
$
|
87
|
|
|
$
|
(57
|
)
|
Total revenues
|
|
425
|
|
|
1,218
|
|
|
87
|
|
|
(57
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
EXPENSES (1)
|
|
|
|
|
|
|
|
|
||||||||
Property and maintenance
|
|
(67
|
)
|
|
(125
|
)
|
|
—
|
|
|
(84
|
)
|
||||
Real estate taxes and insurance
|
|
55
|
|
|
146
|
|
|
2
|
|
|
152
|
|
||||
General and administrative
|
|
75
|
|
|
59
|
|
|
4
|
|
|
8
|
|
||||
Total expenses
|
|
63
|
|
|
80
|
|
|
6
|
|
|
76
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Discontinued operating income (loss)
|
|
362
|
|
|
1,138
|
|
|
81
|
|
|
(133
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Interest and other income
|
|
3
|
|
|
152
|
|
|
—
|
|
|
72
|
|
||||
Income and other tax (expense) benefit
|
|
(15
|
)
|
|
(13
|
)
|
|
—
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Discontinued operations
|
|
350
|
|
|
1,277
|
|
|
81
|
|
|
(61
|
)
|
||||
Net gain (loss) on sales of discontinued operations
|
|
—
|
|
|
223
|
|
|
—
|
|
|
(1
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Discontinued operations, net
|
|
$
|
350
|
|
|
$
|
1,500
|
|
|
$
|
81
|
|
|
$
|
(62
|
)
|
(1)
|
Includes expenses paid in the current period for properties sold in prior periods related to the Company’s period of ownership.
|
12.
|
Commitments and Contingencies
|
13.
|
Reportable Segments
|
|
|
Nine Months Ended September 30,
|
|
Quarter Ended September 30,
|
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Rental income
|
|
$
|
2,035,359
|
|
|
$
|
1,942,492
|
|
|
$
|
694,245
|
|
|
$
|
662,001
|
|
Property and maintenance expense
|
|
(364,948
|
)
|
|
(361,087
|
)
|
|
(122,383
|
)
|
|
(120,139
|
)
|
||||
Real estate taxes and insurance expense
|
|
(254,513
|
)
|
|
(245,717
|
)
|
|
(84,962
|
)
|
|
(80,568
|
)
|
||||
Property management expense
|
|
(60,887
|
)
|
|
(61,080
|
)
|
|
(18,925
|
)
|
|
(18,407
|
)
|
||||
Total operating expenses
|
|
(680,348
|
)
|
|
(667,884
|
)
|
|
(226,270
|
)
|
|
(219,114
|
)
|
||||
Net operating income
|
|
$
|
1,355,011
|
|
|
$
|
1,274,608
|
|
|
$
|
467,975
|
|
|
$
|
442,887
|
|
|
|
Nine Months Ended September 30, 2015
|
|
Nine Months Ended September 30, 2014
|
||||||||||||||||||||
|
|
Rental Income
|
|
Operating Expenses
|
|
NOI
|
|
Rental Income
|
|
Operating Expenses
|
|
NOI
|
||||||||||||
Same store (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Boston
|
|
$
|
188,091
|
|
|
$
|
61,890
|
|
|
$
|
126,201
|
|
|
$
|
182,085
|
|
|
$
|
58,769
|
|
|
$
|
123,316
|
|
New York
|
|
354,704
|
|
|
133,433
|
|
|
221,271
|
|
|
340,374
|
|
|
129,006
|
|
|
211,368
|
|
||||||
San Francisco
|
|
278,514
|
|
|
81,469
|
|
|
197,045
|
|
|
251,812
|
|
|
80,087
|
|
|
171,725
|
|
||||||
Seattle
|
|
124,623
|
|
|
38,724
|
|
|
85,899
|
|
|
116,327
|
|
|
38,706
|
|
|
77,621
|
|
||||||
Southern California
|
|
322,762
|
|
|
102,989
|
|
|
219,773
|
|
|
305,427
|
|
|
101,924
|
|
|
203,503
|
|
||||||
Washington D.C.
|
|
341,797
|
|
|
113,582
|
|
|
228,215
|
|
|
339,453
|
|
|
110,357
|
|
|
229,096
|
|
||||||
Non-core
–
South Florida
|
|
151,115
|
|
|
54,961
|
|
|
96,154
|
|
|
143,000
|
|
|
53,188
|
|
|
89,812
|
|
||||||
Non-core
–
Denver
|
|
89,716
|
|
|
24,246
|
|
|
65,470
|
|
|
82,392
|
|
|
23,246
|
|
|
59,146
|
|
||||||
Non-core
– other
|
|
64,405
|
|
|
23,829
|
|
|
40,576
|
|
|
61,857
|
|
|
23,249
|
|
|
38,608
|
|
||||||
Total same store
|
|
1,915,727
|
|
|
635,123
|
|
|
1,280,604
|
|
|
1,822,727
|
|
|
618,532
|
|
|
1,204,195
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Non-same store/other (2) (3)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Boston
|
|
6,192
|
|
|
1,795
|
|
|
4,397
|
|
|
2,750
|
|
|
633
|
|
|
2,117
|
|
||||||
New York
|
|
4,302
|
|
|
3,660
|
|
|
642
|
|
|
16
|
|
|
1
|
|
|
15
|
|
||||||
San Francisco
|
|
2,709
|
|
|
1,465
|
|
|
1,244
|
|
|
10
|
|
|
24
|
|
|
(14
|
)
|
||||||
Seattle
|
|
14,894
|
|
|
4,394
|
|
|
10,500
|
|
|
3,712
|
|
|
1,332
|
|
|
2,380
|
|
||||||
Southern California
|
|
52,833
|
|
|
19,377
|
|
|
33,456
|
|
|
32,949
|
|
|
14,068
|
|
|
18,881
|
|
||||||
Washington D.C.
|
|
16,370
|
|
|
4,855
|
|
|
11,515
|
|
|
12,610
|
|
|
4,683
|
|
|
7,927
|
|
||||||
Non-core
–
South Florida
|
|
5,916
|
|
|
2,101
|
|
|
3,815
|
|
|
3,694
|
|
|
2,026
|
|
|
1,668
|
|
||||||
Other (3)
|
|
16,416
|
|
|
7,578
|
|
|
8,838
|
|
|
64,024
|
|
|
26,585
|
|
|
37,439
|
|
||||||
Total non-same store/other
|
|
119,632
|
|
|
45,225
|
|
|
74,407
|
|
|
119,765
|
|
|
49,352
|
|
|
70,413
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total
|
|
$
|
2,035,359
|
|
|
$
|
680,348
|
|
|
$
|
1,355,011
|
|
|
$
|
1,942,492
|
|
|
$
|
667,884
|
|
|
$
|
1,274,608
|
|
(1)
|
Same store primarily includes all properties acquired or completed and stabilized prior to January 1, 2014, less properties subsequently sold, which represented
96,432
apartment units.
|
(2)
|
Non-same store primarily includes properties acquired after January 1, 2014, plus any properties in lease-up and not stabilized as of January 1, 2014.
|
(3)
|
Other includes development, other corporate operations and operations prior to sale for properties sold in 2014 and 2015 that do not meet the new discontinued operations criteria.
|
|
|
Quarter Ended September 30, 2015
|
|
Quarter Ended September 30, 2014
|
||||||||||||||||||||
|
|
Rental Income
|
|
Operating Expenses
|
|
NOI
|
|
Rental Income
|
|
Operating Expenses
|
|
NOI
|
||||||||||||
Same store (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Boston
|
|
$
|
63,673
|
|
|
$
|
20,159
|
|
|
$
|
43,514
|
|
|
$
|
61,407
|
|
|
$
|
19,056
|
|
|
$
|
42,351
|
|
New York
|
|
120,149
|
|
|
43,578
|
|
|
76,571
|
|
|
114,968
|
|
|
41,961
|
|
|
73,007
|
|
||||||
San Francisco
|
|
96,115
|
|
|
27,512
|
|
|
68,603
|
|
|
86,468
|
|
|
27,124
|
|
|
59,344
|
|
||||||
Seattle
|
|
43,481
|
|
|
13,206
|
|
|
30,275
|
|
|
40,538
|
|
|
13,082
|
|
|
27,456
|
|
||||||
Southern California
|
|
115,657
|
|
|
36,979
|
|
|
78,678
|
|
|
109,054
|
|
|
36,639
|
|
|
72,415
|
|
||||||
Washington D.C.
|
|
116,935
|
|
|
38,714
|
|
|
78,221
|
|
|
116,449
|
|
|
37,793
|
|
|
78,656
|
|
||||||
Non-core
–
South Florida
|
|
51,960
|
|
|
18,927
|
|
|
33,033
|
|
|
48,850
|
|
|
18,198
|
|
|
30,652
|
|
||||||
Non-core
–
Denver
|
|
30,890
|
|
|
8,619
|
|
|
22,271
|
|
|
28,269
|
|
|
8,150
|
|
|
20,119
|
|
||||||
Non-core
– other
|
|
21,868
|
|
|
7,912
|
|
|
13,956
|
|
|
20,976
|
|
|
7,655
|
|
|
13,321
|
|
||||||
Total same store
|
|
660,728
|
|
|
215,606
|
|
|
445,122
|
|
|
626,979
|
|
|
209,658
|
|
|
417,321
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Non-same store/other (2) (3)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Boston
|
|
2,858
|
|
|
916
|
|
|
1,942
|
|
|
932
|
|
|
222
|
|
|
710
|
|
||||||
New York
|
|
3,079
|
|
|
2,258
|
|
|
821
|
|
|
6
|
|
|
—
|
|
|
6
|
|
||||||
San Francisco
|
|
2,216
|
|
|
899
|
|
|
1,317
|
|
|
4
|
|
|
12
|
|
|
(8
|
)
|
||||||
Seattle
|
|
4,692
|
|
|
1,523
|
|
|
3,169
|
|
|
1,722
|
|
|
505
|
|
|
1,217
|
|
||||||
Southern California
|
|
12,424
|
|
|
4,351
|
|
|
8,073
|
|
|
8,486
|
|
|
3,383
|
|
|
5,103
|
|
||||||
Washington D.C.
|
|
3,538
|
|
|
1,013
|
|
|
2,525
|
|
|
2,932
|
|
|
901
|
|
|
2,031
|
|
||||||
Non-core
–
South Florida
|
|
1,331
|
|
|
563
|
|
|
768
|
|
|
1,042
|
|
|
561
|
|
|
481
|
|
||||||
Other (3)
|
|
3,379
|
|
|
(859
|
)
|
|
4,238
|
|
|
19,898
|
|
|
3,872
|
|
|
16,026
|
|
||||||
Total non-same store/other
|
|
33,517
|
|
|
10,664
|
|
|
22,853
|
|
|
35,022
|
|
|
9,456
|
|
|
25,566
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total
|
|
$
|
694,245
|
|
|
$
|
226,270
|
|
|
$
|
467,975
|
|
|
$
|
662,001
|
|
|
$
|
219,114
|
|
|
$
|
442,887
|
|
(1)
|
Same store primarily includes all properties acquired or completed and stabilized prior to July 1, 2014, less properties subsequently sold, which represented
97,737
apartment units.
|
(2)
|
Non-same store primarily includes properties acquired after July 1, 2014, plus any properties in lease-up and not stabilized as of July 1, 2014.
|
(3)
|
Other includes development, other corporate operations and operations prior to sale for properties sold in 2014 and 2015 that do not meet the new discontinued operations criteria.
|
|
|
Nine Months Ended September 30, 2015
|
||||||
|
|
Total Assets
|
|
Capital Expenditures
|
||||
Same store (1)
|
|
|
|
|
|
|
||
Boston
|
|
$
|
1,854,057
|
|
|
$
|
12,948
|
|
New York
|
|
4,593,457
|
|
|
13,213
|
|
||
San Francisco
|
|
2,666,256
|
|
|
19,932
|
|
||
Seattle
|
|
1,072,287
|
|
|
9,608
|
|
||
Southern California
|
|
2,748,274
|
|
|
23,320
|
|
||
Washington D.C.
|
|
4,199,832
|
|
|
26,697
|
|
||
Non-core
–
South Florida
|
|
1,111,103
|
|
|
12,856
|
|
||
Non-core
–
Denver
|
|
506,436
|
|
|
5,888
|
|
||
Non-core
– other
|
|
325,649
|
|
|
4,862
|
|
||
Total same store
|
|
19,077,351
|
|
|
129,324
|
|
||
|
|
|
|
|
||||
Non-same store/other (2) (3)
|
|
|
|
|
||||
Boston
|
|
173,368
|
|
|
308
|
|
||
New York
|
|
366,978
|
|
|
(12
|
)
|
||
San Francisco
|
|
261,039
|
|
|
3
|
|
||
Seattle
|
|
368,624
|
|
|
70
|
|
||
Southern California
|
|
837,998
|
|
|
3,713
|
|
||
Washington D.C.
|
|
237,900
|
|
|
568
|
|
||
Non-core
–
South Florida
|
|
65,193
|
|
|
30
|
|
||
Other (3)
|
|
1,620,353
|
|
|
434
|
|
||
Total non-same store/other
|
|
3,931,453
|
|
|
5,114
|
|
||
Total
|
|
$
|
23,008,804
|
|
|
$
|
134,438
|
|
(1)
|
Same store primarily includes all properties acquired or completed and stabilized prior to January 1, 2014, less properties subsequently sold, which represented
96,432
apartment units.
|
(2)
|
Non-same store primarily includes properties acquired after January 1, 2014, plus any properties in lease-up and not stabilized as of January 1, 2014.
|
(3)
|
Other includes development, other corporate operations and capital expenditures for properties sold.
|
14.
|
Subsequent Events/Other
|
•
|
Acquired
two
properties consisting of
343
apartment units for
$132.3 million
;
|
•
|
Sold
one
property consisting of
150
apartment units for
$48.5 million
; and
|
•
|
Repaid
$150.0 million
of mortgage loans.
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
▪
|
We intend to actively acquire, develop and rehab multifamily properties for rental operations as market conditions dictate. We may also acquire multifamily properties that are unoccupied or in the early stages of lease up. We may be unable to lease up these apartment properties on schedule, resulting in decreases in expected rental revenues and/or lower yields due to lower occupancy and rates as well as higher than expected concessions or higher than expected operating expenses. We may not be able to achieve rents that are consistent with expectations for acquired, developed or rehabbed properties. We may underestimate the costs necessary to bring an acquired property up to standards established for its intended market position, to complete a development property or to complete a rehab. Additionally, we expect that other real estate investors with capital will compete with us for attractive investment opportunities or may also develop properties in markets where we focus our development and acquisition efforts. This competition (or lack thereof) may increase (or depress) prices for multifamily properties. We may not be in a position or have the opportunity in the future to make suitable property acquisitions on favorable terms. We have acquired in the past and intend to continue to pursue the acquisition of properties and portfolios of properties, including large portfolios, that could increase our size and result in alterations to our capital structure. The total number of apartment units under development, costs of development and estimated completion dates are subject to uncertainties arising from changing economic conditions (such as the cost of labor and construction materials), competition and local government regulation;
|
▪
|
Debt financing and other capital required by the Company may not be available or may only be available on adverse terms;
|
▪
|
Labor and materials required for maintenance, repair, capital expenditure or development may be more expensive than anticipated;
|
▪
|
Occupancy levels and market rents may be adversely affected by national and local economic and market conditions including, without limitation, new construction and excess inventory of multifamily and single family housing, increasing portions of single family housing stock being converted to rental use, rental housing subsidized by the government, other government programs that favor single family rental housing or owner occupied housing over multifamily rental housing, governmental regulations, slow or negative employment growth and household formation, the availability of low-interest mortgages or the availability of mortgages requiring little or no down payment for single family home buyers, changes in social preferences and the potential for geopolitical instability, all of which are beyond the Company's control; and
|
▪
|
Additional factors as discussed in Part I of the Company’s and the Operating Partnership's Annual Report on Form 10-K, particularly those under “Item 1A.
Risk Factors
”.
|
▪
|
High barriers to entry where, because of land scarcity or government regulation, it is difficult or costly to build new apartment properties, creating limits on new supply;
|
▪
|
High home ownership costs;
|
▪
|
Strong economic growth leading to job growth and household formation, which in turn leads to high demand for our apartments;
|
▪
|
Urban core locations with an attractive quality of life leading to high resident demand and retention; and
|
▪
|
Favorable demographics contributing to a larger pool of target residents with a high propensity to rent apartments.
|
▪
|
Acquired
one
consolidated apartment property consisting of
202
apartment units for
$130.3 million
at a cap rate (see definition below) of
4.2%
and
three
land parcels for
$27.8 million
; and
|
▪
|
Sold
seven
consolidated apartment properties consisting of
1,707
apartments units as well as a 193,230 square foot medical office building for
$464.8 million
at a weighted average cap rate of
5.3%
generating an unlevered internal rate of return ("IRR"), inclusive of indirect management costs, of
13.5%
.
|
|
|
Nine Months Ended
|
|
Quarter Ended
|
||||||
|
|
September 30, 2015
|
|
September 30, 2015
|
||||||
|
|
Properties
|
Apartment
Units |
|
Properties
|
Apartment
Units |
||||
Same Store Properties at Beginning of Period
|
|
365
|
|
97,911
|
|
|
362
|
|
97,580
|
|
2013 acquisitions, excluding Archstone
|
|
1
|
|
322
|
|
|
—
|
|
—
|
|
2015 dispositions
|
|
(7
|
)
|
(1,707
|
)
|
|
(1
|
)
|
(330
|
)
|
Lease-up properties stabilized
|
|
1
|
|
188
|
|
|
3
|
|
486
|
|
Properties removed from same store (1)
|
|
(1
|
)
|
(285
|
)
|
|
—
|
|
—
|
|
Other
|
|
—
|
|
3
|
|
|
—
|
|
1
|
|
Same Store Properties at September 30, 2015
|
|
359
|
|
96,432
|
|
|
364
|
|
97,737
|
|
|
|
Nine Months Ended
|
|
Quarter Ended
|
||||||
|
|
September 30, 2015
|
|
September 30, 2015
|
||||||
|
|
Properties
|
Apartment
Units |
|
Properties
|
Apartment
Units |
||||
Same Store
|
|
359
|
|
96,432
|
|
|
364
|
|
97,737
|
|
|
|
|
|
|
|
|
||||
Non-Same Store:
|
|
|
|
|
|
|
||||
2015 acquisitions
|
|
1
|
|
202
|
|
|
1
|
|
202
|
|
2014 acquisitions
|
|
4
|
|
1,011
|
|
|
3
|
|
581
|
|
2014 acquisitions not yet stabilized (2)
|
|
2
|
|
342
|
|
|
1
|
|
208
|
|
2013 acquisitions not yet stabilized (2)
|
|
2
|
|
613
|
|
|
—
|
|
—
|
|
2013 acquisitions not managed by the Company (3)
|
|
3
|
|
853
|
|
|
3
|
|
853
|
|
2013 acquisitions not consolidated
|
|
1
|
|
336
|
|
|
1
|
|
336
|
|
Lease-up properties not yet stabilized (2)
|
|
16
|
|
4,161
|
|
|
15
|
|
4,033
|
|
Properties removed from same store (1)
|
|
1
|
|
285
|
|
|
1
|
|
285
|
|
Other
|
|
1
|
|
1
|
|
|
1
|
|
1
|
|
Total Non-Same Store
|
|
31
|
|
7,804
|
|
|
26
|
|
6,499
|
|
Military Housing (not consolidated)
|
|
2
|
|
5,111
|
|
|
2
|
|
5,111
|
|
Total Properties and Apartment Units
|
|
392
|
|
109,347
|
|
|
392
|
|
109,347
|
|
(1)
|
Represents one property containing 285 apartment units (Playa Pacifica in Hermosa Beach, CA) which was removed from the same store portfolio due to a major renovation in which significant portions of the property are being taken offline for extended time periods. As of
September 30, 2015
, the property had
144
apartment units removed from service and an occupancy of only
26.9%
. This property will not return to the same store portfolio until it is stabilized for all of the current and comparable periods presented.
|
(2)
|
Includes properties in various stages of lease-up and properties where lease-up has been completed but the properties were not stabilized for the comparable periods presented.
|
(3)
|
Includes three properties containing 853 apartment units acquired on February 27, 2013 in conjunction with the acquisition of Archstone that are owned by the Company but the entire projects are master leased to a third party corporate housing provider and the Company earns monthly net rental income.
|
September YTD 2015 vs. September YTD 2014
|
||||||||||||||||||||||
Same Store Results/Statistics for 96,432 Same Store Apartment Units
|
||||||||||||||||||||||
$ in thousands (except for Average Rental Rate)
|
||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
Results
|
|
Statistics
|
||||||||||||||||||
Description
|
|
Revenues
|
|
Expenses
|
|
NOI
|
|
Average
Rental
Rate (1)
|
|
Occupancy
|
|
Turnover
|
||||||||||
YTD 2015
|
|
$
|
1,915,727
|
|
|
$
|
635,123
|
|
|
$
|
1,280,604
|
|
|
$
|
2,299
|
|
|
96.1
|
%
|
|
43.2
|
%
|
YTD 2014
|
|
$
|
1,822,727
|
|
|
$
|
618,532
|
|
|
$
|
1,204,195
|
|
|
$
|
2,197
|
|
|
95.7
|
%
|
|
42.6
|
%
|
Change
|
|
$
|
93,000
|
|
|
$
|
16,591
|
|
|
$
|
76,409
|
|
|
$
|
102
|
|
|
0.4
|
%
|
|
0.6
|
%
|
Change
|
|
5.1
|
%
|
|
2.7
|
%
|
|
6.3
|
%
|
|
4.6
|
%
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
(1) Average rental rate is defined as total rental revenues divided by the weighted average occupied apartment units for the period.
|
September YTD 2015 vs. September YTD 2014
|
||||||||||||||||||
Same Store Operating Expenses for 96,432 Same Store Apartment Units
|
||||||||||||||||||
$ in thousands
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Actual
YTD 2015 |
|
Actual
YTD 2014 |
|
$
Change |
|
%
Change |
|
% of Actual
YTD 2015 Operating Expenses |
||||||||
Real estate taxes
|
|
$
|
223,004
|
|
|
$
|
212,106
|
|
|
$
|
10,898
|
|
|
5.1
|
%
|
|
35.1
|
%
|
On-site payroll (1)
|
|
132,694
|
|
|
131,581
|
|
|
1,113
|
|
|
0.8
|
%
|
|
20.9
|
%
|
|||
Utilities (2)
|
|
90,962
|
|
|
94,270
|
|
|
(3,308
|
)
|
|
(3.5
|
%)
|
|
14.3
|
%
|
|||
Repairs and maintenance (3)
|
|
80,694
|
|
|
74,653
|
|
|
6,041
|
|
|
8.1
|
%
|
|
12.7
|
%
|
|||
Property management costs (4)
|
|
57,472
|
|
|
54,682
|
|
|
2,790
|
|
|
5.1
|
%
|
|
9.1
|
%
|
|||
Insurance
|
|
16,036
|
|
|
17,950
|
|
|
(1,914
|
)
|
|
(10.7
|
%)
|
|
2.5
|
%
|
|||
Leasing and advertising
|
|
7,822
|
|
|
7,626
|
|
|
196
|
|
|
2.6
|
%
|
|
1.2
|
%
|
|||
Other on-site operating expenses (5)
|
|
26,439
|
|
|
25,664
|
|
|
775
|
|
|
3.0
|
%
|
|
4.2
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Same store operating expenses
|
|
$
|
635,123
|
|
|
$
|
618,532
|
|
|
$
|
16,591
|
|
|
2.7
|
%
|
|
100.0
|
%
|
(1)
|
On-site payroll – Includes payroll and related expenses for on-site personnel including property managers, leasing consultants and maintenance staff.
|
(2)
|
Utilities – Represents gross expenses prior to any recoveries under the Resident Utility Billing System (“RUBS”). Recoveries are reflected in rental income.
|
(3)
|
Repairs and maintenance – Includes general maintenance costs, apartment unit turnover costs including interior painting, routine landscaping, security, exterminating, fire protection, snow removal, elevator, roof and parking lot repairs and other miscellaneous building repair costs.
|
(4)
|
Property management costs – Includes payroll and related expenses for departments, or portions of departments, that directly support on-site management. These include such departments as regional and corporate property management, property accounting, human resources, training, marketing and revenue management, procurement, real estate tax, property legal services and information technology.
|
(5)
|
Other on-site operating expenses – Includes ground lease costs and administrative costs such as office supplies, telephone and data charges and association and business licensing fees.
|
|
|
Nine Months Ended September 30,
|
||||||
|
|
2015
|
|
2014
|
||||
|
|
(Amounts in thousands)
|
||||||
Operating income
|
|
$
|
721,856
|
|
|
$
|
670,843
|
|
Adjustments:
|
|
|
|
|
||||
Non-same store operating results
|
|
(74,407
|
)
|
|
(70,413
|
)
|
||
Fee and asset management revenue
|
|
(6,413
|
)
|
|
(7,596
|
)
|
||
Fee and asset management expense
|
|
3,764
|
|
|
4,293
|
|
||
Depreciation
|
|
584,862
|
|
|
565,772
|
|
||
General and administrative
|
|
50,942
|
|
|
41,296
|
|
||
Same store NOI
|
|
$
|
1,280,604
|
|
|
$
|
1,204,195
|
|
2015 Same Store Assumptions
|
||
Physical occupancy
|
96.0
|
%
|
Revenue change
|
5.2
|
%
|
Expense change
|
3.1
|
%
|
NOI change
|
6.2
|
%
|
▪
|
Development and newly stabilized development properties in lease-up of $20.7 million;
|
▪
|
Operating properties acquired in 2014 and 2015 of $14.3 million;
|
▪
|
Operating activities from other miscellaneous operations; and
|
▪
|
Was mostly offset by the lost NOI from 2014 and 2015 dispositions of $33.4 million as well as a decrease in other miscellaneous properties (including three master-leased properties from the acquisition of Archstone) of $1.0 million.
|
Third Quarter 2015 vs. Third Quarter 2014
|
||||||||||||||||||||||
Same Store Results/Statistics for 97,737 Same Store Apartment Units
|
||||||||||||||||||||||
$ in thousands (except for Average Rental Rate)
|
||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
Results
|
|
Statistics
|
||||||||||||||||||
Description
|
|
Revenues
|
|
Expenses
|
|
NOI
|
|
Average
Rental
Rate (1)
|
|
Occupancy
|
|
Turnover
|
||||||||||
Q3 2015
|
|
$
|
660,728
|
|
|
$
|
215,606
|
|
|
$
|
445,122
|
|
|
$
|
2,345
|
|
|
96.1
|
%
|
|
17.6
|
%
|
Q3 2014
|
|
$
|
626,979
|
|
|
$
|
209,658
|
|
|
$
|
417,321
|
|
|
$
|
2,227
|
|
|
96.1
|
%
|
|
17.2
|
%
|
Change
|
|
$
|
33,749
|
|
|
$
|
5,948
|
|
|
$
|
27,801
|
|
|
$
|
118
|
|
|
0.0
|
%
|
|
0.4
|
%
|
Change
|
|
5.4
|
%
|
|
2.8
|
%
|
|
6.7
|
%
|
|
5.3
|
%
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
(1) Average rental rate is defined as total rental revenues divided by the weighted average occupied apartment units for the period.
|
Third Quarter 2015 vs. Third Quarter 2014
|
||||||||||||||||||
Same Store Operating Expenses for 97,737 Same Store Apartment Units
|
||||||||||||||||||
$ in thousands
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Actual
Q3 2015
|
|
Actual
Q3 2014 |
|
$
Change |
|
%
Change |
|
% of Actual
Q3 2015 Operating Expenses |
||||||||
Real estate taxes
|
|
$
|
75,504
|
|
|
$
|
71,831
|
|
|
$
|
3,673
|
|
|
5.1
|
%
|
|
35.0
|
%
|
On-site payroll (1)
|
|
44,547
|
|
|
45,223
|
|
|
(676
|
)
|
|
(1.5
|
%)
|
|
20.7
|
%
|
|||
Utilities (2)
|
|
30,185
|
|
|
29,959
|
|
|
226
|
|
|
0.8
|
%
|
|
14.0
|
%
|
|||
Repairs and maintenance (3)
|
|
28,634
|
|
|
26,303
|
|
|
2,331
|
|
|
8.9
|
%
|
|
13.3
|
%
|
|||
Property management costs (4)
|
|
19,822
|
|
|
18,809
|
|
|
1,013
|
|
|
5.4
|
%
|
|
9.2
|
%
|
|||
Insurance
|
|
5,425
|
|
|
6,082
|
|
|
(657
|
)
|
|
(10.8
|
%)
|
|
2.5
|
%
|
|||
Leasing and advertising
|
|
2,738
|
|
|
2,809
|
|
|
(71
|
)
|
|
(2.5
|
%)
|
|
1.3
|
%
|
|||
Other on-site operating expenses (5)
|
|
8,751
|
|
|
8,642
|
|
|
109
|
|
|
1.3
|
%
|
|
4.0
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Same store operating expenses
|
|
$
|
215,606
|
|
|
$
|
209,658
|
|
|
$
|
5,948
|
|
|
2.8
|
%
|
|
100.0
|
%
|
(1)
|
On-site payroll – Includes payroll and related expenses for on-site personnel including property managers, leasing consultants and maintenance staff.
|
(2)
|
Utilities – Represents gross expenses prior to any recoveries under the Resident Utility Billing System (“RUBS”). Recoveries are reflected in rental income.
|
(3)
|
Repairs and maintenance – Includes general maintenance costs, apartment unit turnover costs including interior painting, routine landscaping, security, exterminating, fire protection, snow removal, elevator, roof and parking lot repairs and other miscellaneous building repair costs.
|
(4)
|
Property management costs – Includes payroll and related expenses for departments, or portions of departments, that directly support on-site management. These include such departments as regional and corporate property management, property accounting, human resources, training, marketing and revenue management, procurement, real estate tax, property legal services and information technology.
|
(5)
|
Other on-site operating expenses – Includes ground lease costs and administrative costs such as office supplies, telephone and data charges and association and business licensing fees.
|
|
|
Quarter Ended September 30,
|
||||||
|
|
2015
|
|
2014
|
||||
|
|
(Amounts in thousands)
|
||||||
Operating income
|
|
$
|
257,501
|
|
|
$
|
243,274
|
|
Adjustments:
|
|
|
|
|
||||
Non-same store operating results
|
|
(22,853
|
)
|
|
(25,566
|
)
|
||
Fee and asset management revenue
|
|
(2,044
|
)
|
|
(2,077
|
)
|
||
Fee and asset management expense
|
|
1,169
|
|
|
1,253
|
|
||
Depreciation
|
|
196,059
|
|
|
190,469
|
|
||
General and administrative
|
|
15,290
|
|
|
9,968
|
|
||
Same store NOI
|
|
$
|
445,122
|
|
|
$
|
417,321
|
|
▪
|
The lost NOI from 2014 and 2015 dispositions of $12.8 million as well as a decrease in other miscellaneous properties (including three master-leased properties from the acquisition of Archstone) of $0.9 million; and
|
▪
|
Partially offset by development and newly stabilized development properties in lease-up of $6.2 million, operating properties acquired in 2014 and 2015 of $4.2 million and operating activities from other miscellaneous operations.
|
▪
|
Disposed of
seven
consolidated properties and a 193,230 square foot medical office building, receiving net proceeds of approximately
$457.5 million
;
|
▪
|
Issued
$450.0 million
of ten-year
3.375%
fixed rate public notes, receiving net proceeds of
$447.5 million
before underwriting fees, hedge termination costs and other expenses, at an all-in effective interest rate of
3.81%
;
|
▪
|
Issued
$300.0 million
of thirty-year
4.50%
fixed rate public notes, receiving net proceeds of
$298.9 million
before underwriting fees and other expenses, at an all-in effective interest rate of
4.55%
;
|
▪
|
Received approximately
$45.1 million
in distributions from the Residual JV as a result of the winddown/sale of remaining assets owned by the Residual JV and litigation settlements received by the Residual JV; and
|
▪
|
Issued approximately
0.9 million
Common Shares related to share option exercises and ESPP purchases and received net proceeds of
$40.4 million
, which were contributed to the capital of the Operating Partnership in exchange for additional OP Units (on a one-for-one Common Share per OP Unit basis).
|
▪
|
Acquire
one
consolidated property and
three
land parcels for approximately
$159.6 million
;
|
▪
|
Invest
$485.8 million
primarily in development projects;
|
▪
|
Repay
$184.7 million
of mortgage loans;
|
▪
|
Repay
$300.0 million
of
6.584%
unsecured notes at maturity; and
|
▪
|
Repurchase and retire 196,400 Series K Preferred Shares for total cash consideration of approximately $12.7 million, inclusive of $0.1 million of prorated dividends (See Note 3).
|
Debt Summary as of September 30, 2015
|
|||||||||||||
(Amounts in thousands)
|
|||||||||||||
|
|
Amounts (1)
|
|
% of Total
|
|
Weighted
Average Rates (1) |
|
Weighted
Average Maturities (years) |
|||||
Secured
|
|
$
|
4,891,529
|
|
|
45.3
|
%
|
|
4.22
|
%
|
|
6.9
|
|
Unsecured
|
|
5,911,790
|
|
|
54.7
|
%
|
|
4.78
|
%
|
|
8.9
|
|
|
Total
|
|
$
|
10,803,319
|
|
|
100.0
|
%
|
|
4.53
|
%
|
|
8.1
|
|
|
|
|
|
|
|
|
|
|
|||||
Fixed Rate Debt:
|
|
|
|
|
|
|
|
|
|||||
Secured – Conventional
|
|
$
|
4,153,761
|
|
|
38.4
|
%
|
|
4.85
|
%
|
|
5.3
|
|
Unsecured – Public
|
|
5,422,372
|
|
|
50.2
|
%
|
|
5.36
|
%
|
|
9.4
|
|
|
Fixed Rate Debt
|
|
9,576,133
|
|
|
88.6
|
%
|
|
5.13
|
%
|
|
7.7
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Floating Rate Debt:
|
|
|
|
|
|
|
|
|
|||||
Secured – Conventional
|
|
7,985
|
|
|
0.1
|
%
|
|
0.12
|
%
|
|
18.3
|
|
|
Secured – Tax Exempt
|
|
729,783
|
|
|
6.8
|
%
|
|
0.64
|
%
|
|
15.5
|
|
|
Unsecured – Public (2)
|
|
459,422
|
|
|
4.2
|
%
|
|
0.91
|
%
|
|
3.8
|
|
|
Unsecured – Revolving Credit Facility
|
|
—
|
|
|
—
|
|
|
1.07
|
%
|
|
2.5
|
|
|
Unsecured – Commercial Paper Program (3)
|
|
29,996
|
|
|
0.3
|
%
|
|
0.57
|
%
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Floating Rate Debt
|
|
1,227,186
|
|
|
11.4
|
%
|
|
0.76
|
%
|
|
10.8
|
|
|
Total
|
|
$
|
10,803,319
|
|
|
100.0
|
%
|
|
4.53
|
%
|
|
8.1
|
|
(1)
|
Net of the effect of any derivative instruments. Weighted average rates are for the nine months ended
September 30, 2015
.
|
(2)
|
Fair value interest rate swaps convert the $450.0 million 2.375% notes due July 1, 2019 to a floating interest rate of 90-Day LIBOR plus 0.61%.
|
(3)
|
As of
September 30, 2015
, the weighted average maturity on the Company's outstanding commercial paper was
12
days.
|
Debt Maturity Schedule as of September 30, 2015
|
|||||||||||||||||||||
(Amounts in thousands)
|
|||||||||||||||||||||
Year
|
|
Fixed
Rate (1) |
|
Floating
Rate (1) |
|
Total
|
|
% of Total
|
|
Weighted Average
Rates on Fixed Rate Debt (1) |
|
Weighted Average
Rates on Total Debt (1) |
|||||||||
2015
|
|
$
|
2,121
|
|
|
$
|
30,000
|
|
(2)
|
$
|
32,121
|
|
|
0.3
|
%
|
|
5.23
|
%
|
|
0.75
|
%
|
2016
|
|
1,115,342
|
|
|
—
|
|
|
1,115,342
|
|
|
10.3
|
%
|
|
5.33
|
%
|
|
5.33
|
%
|
|||
2017
|
|
1,347,390
|
|
|
456
|
|
|
1,347,846
|
|
|
12.5
|
%
|
|
6.16
|
%
|
|
6.16
|
%
|
|||
2018
|
|
82,799
|
|
|
97,659
|
|
|
180,458
|
|
|
1.7
|
%
|
|
5.59
|
%
|
|
3.07
|
%
|
|||
2019
|
|
806,701
|
|
|
480,525
|
|
|
1,287,226
|
|
|
11.9
|
%
|
|
5.48
|
%
|
|
3.75
|
%
|
|||
2020
|
|
1,678,623
|
|
|
809
|
|
|
1,679,432
|
|
|
15.5
|
%
|
|
5.49
|
%
|
|
5.49
|
%
|
|||
2021
|
|
1,195,251
|
|
|
856
|
|
|
1,196,107
|
|
|
11.1
|
%
|
|
4.63
|
%
|
|
4.63
|
%
|
|||
2022
|
|
228,924
|
|
|
905
|
|
|
229,829
|
|
|
2.1
|
%
|
|
3.16
|
%
|
|
3.17
|
%
|
|||
2023
|
|
1,327,965
|
|
|
956
|
|
|
1,328,921
|
|
|
12.3
|
%
|
|
3.74
|
%
|
|
3.74
|
%
|
|||
2024
|
|
2,497
|
|
|
1,011
|
|
|
3,508
|
|
|
0.0
|
%
|
|
4.97
|
%
|
|
5.14
|
%
|
|||
2025+
|
|
1,772,417
|
|
|
673,977
|
|
|
2,446,394
|
|
|
22.7
|
%
|
|
4.49
|
%
|
|
3.36
|
%
|
|||
Premium/(Discount)
|
|
16,103
|
|
|
(59,968
|
)
|
|
(43,865
|
)
|
|
(0.4
|
%)
|
|
N/A
|
|
|
N/A
|
|
|||
Total
|
|
$
|
9,576,133
|
|
|
$
|
1,227,186
|
|
|
$
|
10,803,319
|
|
|
100.0
|
%
|
|
4.97
|
%
|
|
4.46
|
%
|
(1)
|
Net of the effect of any derivative instruments. Weighted average rates are as of
September 30, 2015
.
|
(2)
|
Represents the principal outstanding on the Company's unsecured commercial paper program. The Company may borrow up to a maximum of $500.0 million on the program subject to market conditions.
|
Unsecured Debt Summary as of September 30, 2015
|
|||||||||||||||||
(Amounts in thousands)
|
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
Coupon
Rate |
|
Due
Date |
|
|
Face
Amount |
|
Unamortized
Premium/ (Discount) |
|
Net
Balance |
||||||
Fixed Rate Notes:
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
5.125%
|
|
03/15/16
|
|
|
$
|
500,000
|
|
|
$
|
(22
|
)
|
|
$
|
499,978
|
|
|
|
5.375%
|
|
08/01/16
|
|
|
400,000
|
|
|
(155
|
)
|
|
399,845
|
|
|||
|
|
5.750%
|
|
06/15/17
|
|
|
650,000
|
|
|
(890
|
)
|
|
649,110
|
|
|||
|
|
7.125%
|
|
10/15/17
|
|
|
150,000
|
|
|
(132
|
)
|
|
149,868
|
|
|||
|
|
2.375%
|
|
07/01/19
|
(1)
|
|
450,000
|
|
|
(337
|
)
|
|
449,663
|
|
|||
Fair Value Derivative Adjustments
|
|
|
|
|
(1)
|
|
(450,000
|
)
|
|
337
|
|
|
(449,663
|
)
|
|||
|
|
4.750%
|
|
07/15/20
|
|
|
600,000
|
|
|
(2,175
|
)
|
|
597,825
|
|
|||
|
|
4.625%
|
|
12/15/21
|
|
|
1,000,000
|
|
|
(2,349
|
)
|
|
997,651
|
|
|||
|
|
3.000%
|
|
04/15/23
|
|
|
500,000
|
|
|
(3,338
|
)
|
|
496,662
|
|
|||
|
|
3.375%
|
|
06/01/25
|
|
|
450,000
|
|
|
(2,393
|
)
|
|
447,607
|
|
|||
|
|
7.570%
|
|
08/15/26
|
|
|
140,000
|
|
|
—
|
|
|
140,000
|
|
|||
|
|
4.500%
|
|
07/01/44
|
|
|
750,000
|
|
|
(5,053
|
)
|
|
744,947
|
|
|||
|
|
4.500%
|
|
06/01/45
|
|
|
300,000
|
|
|
(1,121
|
)
|
|
298,879
|
|
|||
|
|
|
|
|
|
|
5,440,000
|
|
|
(17,628
|
)
|
|
5,422,372
|
|
|||
Floating Rate Notes:
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
07/01/19
|
(1)
|
|
450,000
|
|
|
(337
|
)
|
|
449,663
|
|
|||
Fair Value Derivative Adjustments
|
|
|
|
07/01/19
|
(1)
|
|
9,759
|
|
|
—
|
|
|
9,759
|
|
|||
|
|
|
|
|
|
|
459,759
|
|
|
(337
|
)
|
|
459,422
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Line of Credit and Commercial Paper:
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Revolving Credit Facility
|
|
LIBOR+0.95%
|
|
04/01/18
|
(2)(3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Commercial Paper Program
|
|
(4)
|
|
(4)
|
(2)
|
|
30,000
|
|
|
(4
|
)
|
|
29,996
|
|
|||
|
|
|
|
|
|
|
30,000
|
|
|
(4
|
)
|
|
29,996
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total Unsecured Debt
|
|
|
|
|
|
|
$
|
5,929,759
|
|
|
$
|
(17,969
|
)
|
|
$
|
5,911,790
|
|
(1)
|
Fair value interest rate swaps convert the $450.0 million 2.375% notes due July 1, 2019 to a floating interest rate of 90-Day LIBOR plus 0.61%.
|
(2)
|
Facility/program is private. All other unsecured debt is public.
|
(3)
|
Represents the Company's $2.5 billion unsecured revolving credit facility maturing April 1, 2018. The interest rate on advances under the credit facility will generally be LIBOR plus a spread (currently 0.95%) and an annual facility fee (currently 15 basis points). Both the spread and the facility fee are dependent on the credit rating of the Company's long-term debt. As of
September 30, 2015
, there was approximately
$2.42 billion
available on this facility (net of
$45.1 million
which was restricted/dedicated to support letters of credit and net of
$30.0 million
outstanding on the commercial paper program).
|
(4)
|
Represents the Company's unsecured commercial paper program. The Company may borrow up to a maximum of
$500.0 million
on this program subject to market conditions. The notes bear interest at various floating rates with a weighted average of
0.57%
for the nine months ended
September 30, 2015
and a weighted average maturity of
12
days as of
September 30, 2015
.
|
Equity Residential
|
|||||||||||||||||
Capital Structure as of September 30, 2015
|
|||||||||||||||||
(Amounts in thousands except for share/unit and per share amounts)
|
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Secured Debt
|
|
|
|
|
|
$
|
4,891,529
|
|
|
45.3
|
%
|
|
|
||||
Unsecured Debt
|
|
|
|
|
|
5,911,790
|
|
|
54.7
|
%
|
|
|
|||||
Total Debt
|
|
|
|
|
|
10,803,319
|
|
|
100.0
|
%
|
|
27.5
|
%
|
||||
Common Shares (includes Restricted Shares)
|
|
364,140,040
|
|
|
96.2
|
%
|
|
|
|
|
|
|
|||||
Units (includes OP Units and Restricted Units)
|
|
14,455,727
|
|
|
3.8
|
%
|
|
|
|
|
|
|
|||||
Total Shares and Units
|
|
378,595,767
|
|
|
100.0
|
%
|
|
|
|
|
|
|
|||||
Common Share Price at September 30, 2015
|
|
$
|
75.12
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
28,440,114
|
|
|
99.9
|
%
|
|
|
|||||
Perpetual Preferred Equity (see below)
|
|
|
|
|
|
40,180
|
|
|
0.1
|
%
|
|
|
|||||
Total Equity
|
|
|
|
|
|
28,480,294
|
|
|
100.0
|
%
|
|
72.5
|
%
|
||||
Total Market Capitalization
|
|
|
|
|
|
$
|
39,283,613
|
|
|
|
|
100.0
|
%
|
Equity Residential
|
|||||||||||||||||
Perpetual Preferred Equity as of September 30, 2015
|
|||||||||||||||||
(Amounts in thousands except for share and per share amounts)
|
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Series
|
|
Redemption
Date |
|
Outstanding
Shares |
|
Liquidation
Value |
|
Annual
Dividend Per Share |
|
Annual
Dividend Amount |
|||||||
Preferred Shares:
|
|
|
|
|
|
|
|
|
|
|
|||||||
8.29% Series K (1)
|
|
12/10/26
|
|
803,600
|
|
|
$
|
40,180
|
|
|
$
|
4.145
|
|
|
$
|
3,331
|
|
Total Perpetual Preferred Equity
|
|
|
|
803,600
|
|
|
$
|
40,180
|
|
|
|
|
$
|
3,331
|
|
(1)
|
Effective January 26, 2015, the Company repurchased and retired
196,400
Series K Preferred Shares with a par value of
$9.82 million
for total cash consideration of approximately
$12.7 million
. As a result of this partial redemption, the Company incurred a cash charge of approximately
$2.8 million
which was recorded as a premium on the redemption of Preferred Shares.
|
ERP Operating Limited Partnership
|
||||||||||||||
Capital Structure as of September 30, 2015
|
||||||||||||||
(Amounts in thousands except for unit and per unit amounts)
|
||||||||||||||
|
|
|
|
|
|
|
|
|
||||||
Secured Debt
|
|
|
|
$
|
4,891,529
|
|
|
45.3
|
%
|
|
|
|||
Unsecured Debt
|
|
|
|
5,911,790
|
|
|
54.7
|
%
|
|
|
||||
Total Debt
|
|
|
|
10,803,319
|
|
|
100.0
|
%
|
|
27.5
|
%
|
|||
Total outstanding Units
|
|
378,595,767
|
|
|
|
|
|
|
|
|||||
Common Share Price at September 30, 2015
|
|
$
|
75.12
|
|
|
|
|
|
|
|
||||
|
|
|
|
28,440,114
|
|
|
99.9
|
%
|
|
|
||||
Perpetual Preference Units (see below)
|
|
|
|
40,180
|
|
|
0.1
|
%
|
|
|
||||
Total Equity
|
|
|
|
28,480,294
|
|
|
100.0
|
%
|
|
72.5
|
%
|
|||
Total Market Capitalization
|
|
|
|
$
|
39,283,613
|
|
|
|
|
100.0
|
%
|
ERP Operating Limited Partnership
|
|||||||||||||||||
Perpetual Preference Units as of September 30, 2015
|
|||||||||||||||||
(Amounts in thousands except for unit and per unit amounts)
|
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Series
|
|
Redemption
Date |
|
Outstanding
Units |
|
Liquidation
Value |
|
Annual
Dividend Per Unit |
|
Annual
Dividend Amount |
|||||||
Preference Units:
|
|
|
|
|
|
|
|
|
|
|
|||||||
8.29% Series K (1)
|
|
12/10/26
|
|
803,600
|
|
|
$
|
40,180
|
|
|
$
|
4.145
|
|
|
$
|
3,331
|
|
Total Perpetual Preference Units
|
|
|
|
803,600
|
|
|
$
|
40,180
|
|
|
|
|
$
|
3,331
|
|
(1)
|
Effective January 26, 2015, the Operating Partnership repurchased and retired
196,400
Series K Preference Units with a par value of
$9.82 million
for total cash consideration of approximately
$12.7 million
, in conjunction with the concurrent redemption of the corresponding Company Preferred Shares. As a result of this partial redemption, the Operating Partnership incurred a cash charge of approximately
$2.8 million
which was recorded as a premium on the redemption of Preference Units.
|
|
|
Standard & Poor's
|
|
Moody's
|
|
Fitch
|
ERPOP's long-term senior debt rating
|
|
A-
|
|
Baa1 (1)
|
|
A-
|
|
|
|
|
|
|
|
ERPOP's short-term commercial paper rating
|
|
A-2
|
|
P-2
|
|
F-2
|
|
|
|
|
|
|
|
EQR's long-term preferred equity rating
|
|
BBB
|
|
Baa2 (2)
|
|
BBB
|
(1)
|
Moody's rated ERPOP's long-term senior debt with a positive outlook.
|
(2)
|
Moody's rated EQR's long-term preferred equity with a positive outlook.
|
▪
|
Replacements
(inside the apartment unit)
. These include:
|
▪
|
flooring such as carpets, hardwood, vinyl or tile;
|
▪
|
appliances;
|
▪
|
mechanical equipment such as individual furnace/air units, hot water heaters, etc;
|
▪
|
furniture and fixtures such as kitchen/bath cabinets, light fixtures, ceiling fans, sinks, tubs, toilets, mirrors, countertops, etc; and
|
▪
|
blinds.
|
▪
|
Building improvements (
outside the apartment unit
). These include:
|
▪
|
roof replacement and major repairs;
|
▪
|
paving or major resurfacing of parking lots, curbs and sidewalks;
|
▪
|
amenities and common areas such as pools, exterior sports and playground equipment, lobbies, clubhouses, laundry rooms, alarm and security systems and offices;
|
▪
|
major building mechanical equipment systems;
|
▪
|
interior and exterior structural repair and exterior painting and siding;
|
▪
|
major landscaping and grounds improvement; and
|
▪
|
vehicles and office and maintenance equipment.
|
Capital Expenditures to Real Estate
|
|||||||||||||||||||||||||||
For the Nine Months Ended September 30, 2015
|
|||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
|
Total
Apartment Units (1) |
|
Replacements
(2) |
|
Avg. Per
Apartment Unit |
|
Building
Improvements (3) |
|
Avg. Per
Apartment Unit |
|
Total
|
|
Avg. Per
Apartment Unit |
|||||||||||||
Same Store Properties (4)
|
|
96,432
|
|
|
$
|
77,432
|
|
|
$
|
803
|
|
|
$
|
51,892
|
|
|
$
|
538
|
|
|
$
|
129,324
|
|
|
$
|
1,341
|
|
Non-Same Store Properties (5)
|
|
6,523
|
|
|
1,053
|
|
|
204
|
|
|
3,627
|
|
|
702
|
|
|
4,680
|
|
|
906
|
|
||||||
Other (6)
|
|
—
|
|
|
274
|
|
|
|
|
160
|
|
|
|
|
434
|
|
|
|
|||||||||
Total
|
|
102,955
|
|
|
$
|
78,759
|
|
|
|
|
$
|
55,679
|
|
|
|
|
$
|
134,438
|
|
|
|
(1)
|
Total Apartment Units – Excludes 1,281 unconsolidated apartment units and 5,111 military housing apartment units for which repairs and maintenance expenses and capital expenditures to real estate are self-funded and do not consolidate into the Company's results.
|
(2)
|
Replacements – Includes new expenditures inside the apartment units such as appliances, mechanical equipment, fixtures and flooring, including carpeting. Replacements for same store properties also include $47.3 million spent during the nine months ended
September 30, 2015
on apartment unit renovations/rehabs (primarily kitchens and baths) on
5,122
same store apartment units (equating to approximately $9,200 per apartment unit rehabbed) designed to reposition these assets for higher rental levels in their respective markets.
|
(3)
|
Building Improvements – Includes roof replacement, paving, amenities and common areas, building mechanical equipment systems, exterior painting and siding, major landscaping, vehicles and office and maintenance equipment.
|
(4)
|
Same Store Properties – Primarily includes all properties acquired or completed and stabilized prior to January 1, 2014, less properties subsequently sold.
|
(5)
|
Non-Same Store Properties – Primarily includes all properties acquired during 2014 and 2015, plus any properties in lease-up and not stabilized as of January 1, 2014. Per apartment unit amounts are based on a weighted average of
5,166
apartment units.
|
(6)
|
Other – Primarily includes expenditures for properties sold and properties under development.
|
Funds From Operations and Normalized Funds From Operations
|
|||||||||||||||||
(Amounts in thousands)
|
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
Nine Months Ended September 30,
|
|
Quarter Ended September 30,
|
||||||||||||
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
Net income
|
|
$
|
694,298
|
|
|
$
|
431,642
|
|
|
$
|
205,456
|
|
|
$
|
231,190
|
|
|
Net (income) attributable to Noncontrolling Interests – Partially Owned Properties
|
|
(2,473
|
)
|
|
(1,800
|
)
|
|
(986
|
)
|
|
(708
|
)
|
|||||
Preferred/preference distributions
|
|
(2,557
|
)
|
|
(3,109
|
)
|
|
(833
|
)
|
|
(1,037
|
)
|
|||||
Premium on redemption of Preferred Shares/Preference Units
|
|
(2,789
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net income available to Common Shares and Units / Units
|
|
686,479
|
|
|
426,733
|
|
|
203,637
|
|
|
229,445
|
|
|||||
|
|
|
|
|
|
|
|
|
|||||||||
Adjustments:
|
|
|
|
|
|
|
|
|
|||||||||
Depreciation
|
|
584,862
|
|
|
565,772
|
|
|
196,059
|
|
|
190,469
|
|
|||||
Depreciation – Non-real estate additions
|
|
(3,767
|
)
|
|
(3,485
|
)
|
|
(1,243
|
)
|
|
(1,137
|
)
|
|||||
Depreciation – Partially Owned Properties
|
|
(3,248
|
)
|
|
(3,211
|
)
|
|
(1,086
|
)
|
|
(1,071
|
)
|
|||||
Depreciation – Unconsolidated Properties
|
|
3,688
|
|
|
5,182
|
|
|
1,231
|
|
|
1,746
|
|
|||||
Net (gain) on sales of unconsolidated entities – operating assets
|
|
(100
|
)
|
|
—
|
|
|
(100
|
)
|
|
—
|
|
|||||
Net (gain) on sales of real estate properties
|
|
(295,692
|
)
|
|
(128,544
|
)
|
|
(66,939
|
)
|
|
(113,641
|
)
|
|||||
Discontinued operations:
|
|
|
|
|
|
|
|
|
|||||||||
Net (gain) loss on sales of discontinued operations
|
|
—
|
|
|
(223
|
)
|
|
—
|
|
|
1
|
|
|||||
FFO available to Common Shares and Units / Units (1) (3) (4)
|
|
972,222
|
|
|
862,224
|
|
|
331,559
|
|
|
305,812
|
|
|||||
Adjustments:
|
|
|
|
|
|
|
|
|
|||||||||
Asset impairment and valuation allowances
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Property acquisition costs and write-off of pursuit costs
|
|
(13,947
|
)
|
|
8,714
|
|
|
943
|
|
|
837
|
|
|||||
Debt extinguishment (gains) losses, including prepayment penalties, preferred
|
|
|
|
|
|
|
|
|
|||||||||
share/preference unit redemptions and non-cash convertible debt discounts
|
|
4,501
|
|
|
513
|
|
|
3,032
|
|
|
22
|
|
|||||
(Gains) losses on sales of non-operating assets, net of income and other tax expense
|
|
|
|
|
|
|
|
|
|||||||||
(benefit)
|
|
(728
|
)
|
|
(1,903
|
)
|
|
72
|
|
|
(1,052
|
)
|
|||||
Other miscellaneous non-comparable items
|
|
2,701
|
|
|
1,191
|
|
|
4,880
|
|
|
3,581
|
|
|||||
Normalized FFO available to Common Shares and Units / Units (2) (3) (4)
|
|
$
|
964,749
|
|
|
$
|
870,739
|
|
|
$
|
340,486
|
|
|
$
|
309,200
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
FFO (1) (3)
|
|
$
|
977,568
|
|
|
$
|
865,333
|
|
|
$
|
332,392
|
|
|
$
|
306,849
|
|
|
Preferred/preference distributions
|
|
(2,557
|
)
|
|
(3,109
|
)
|
|
(833
|
)
|
|
(1,037
|
)
|
|||||
Premium on redemption of Preferred Shares/Preference Units
|
|
(2,789
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
FFO available to Common Shares and Units / Units (1) (3) (4)
|
|
$
|
972,222
|
|
|
$
|
862,224
|
|
|
$
|
331,559
|
|
|
$
|
305,812
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Normalized FFO (2) (3)
|
|
$
|
967,306
|
|
|
$
|
873,848
|
|
|
$
|
341,319
|
|
|
$
|
310,237
|
|
|
Preferred/preference distributions
|
|
(2,557
|
)
|
|
(3,109
|
)
|
|
(833
|
)
|
|
(1,037
|
)
|
|||||
Normalized FFO available to Common Shares and Units / Units (2) (3) (4)
|
|
$
|
964,749
|
|
|
$
|
870,739
|
|
|
$
|
340,486
|
|
|
$
|
309,200
|
|
(1)
|
The National Association of Real Estate Investment Trusts (“NAREIT”) defines funds from operations (“FFO”) (April 2002 White Paper) as net income (computed in accordance with accounting principles generally accepted in the United States (“GAAP”)), excluding gains (or losses) from sales and impairment write-downs of depreciable operating properties, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect funds from operations on the same basis. The April 2002 White Paper states that gain or loss on sales of property is excluded from FFO for previously depreciated operating properties only. Once the Company commences the conversion of apartment units to condominiums, it simultaneously discontinues depreciation of such property.
|
(2)
|
Normalized funds from operations (“Normalized FFO”) begins with FFO and excludes:
|
▪
|
the impact of any expenses relating to non-operating asset impairment and valuation allowances;
|
▪
|
property acquisition and other transaction costs related to mergers and acquisitions and pursuit cost write-offs;
|
▪
|
gains and losses from early debt extinguishment, including prepayment penalties, preferred share/preference unit redemptions and the cost related to the implied option value of non-cash convertible debt discounts;
|
▪
|
gains and losses on the sales of non-operating assets, including gains and losses from land parcel and condominium sales, net of the effect of income tax benefits or expenses; and
|
▪
|
other miscellaneous non-comparable items.
|
(3)
|
The Company believes that FFO and FFO available to Common Shares and Units / Units are helpful to investors as supplemental measures of the operating performance of a real estate company, because they are recognized measures of performance by the real estate industry and by excluding gains or losses related to dispositions of depreciable property and excluding real estate depreciation (which can vary among owners of identical assets in similar condition based on historical cost accounting and useful life estimates), FFO and FFO available to Common Shares and Units / Units can help compare the operating performance of a company’s real estate between periods or as compared to different companies. The Company also believes that Normalized FFO and Normalized FFO available to Common Shares and Units / Units are helpful to investors as supplemental measures of the operating performance of a real estate company because they allow investors to compare the Company’s operating performance to its performance in prior reporting periods and to the operating performance of other real estate companies without the effect of items that by their nature are not comparable from period to period and tend to obscure the Company’s actual operating results. FFO, FFO available to Common Shares and Units / Units, Normalized FFO and Normalized FFO available to Common Shares and Units / Units do not represent net income, net income available to Common Shares / Units or net cash flows from operating activities in accordance with GAAP. Therefore, FFO, FFO available to Common Shares and Units / Units, Normalized FFO and Normalized FFO available to Common Shares and Units / Units should not be exclusively considered as alternatives to net income, net income available to Common Shares / Units or net cash flows from operating activities as determined by GAAP or as a measure of liquidity. The Company’s calculation of FFO, FFO available to Common Shares and Units / Units, Normalized FFO and Normalized FFO available to Common Shares and Units / Units may differ from other real estate companies due to, among other items, variations in cost capitalization policies for capital expenditures and, accordingly, may not be comparable to such other real estate companies.
|
(4)
|
FFO available to Common Shares and Units / Units and Normalized FFO available to Common Shares and Units / Units are calculated on a basis consistent with net income available to Common Shares / Units and reflects adjustments to net income for preferred distributions and premiums on redemption of preferred shares/preference units in accordance with accounting principles generally accepted in the United States. The equity positions of various individuals and entities that contributed their properties to the Operating Partnership in exchange for OP Units are collectively referred to as the “Noncontrolling Interests – Operating Partnership”. Subject to certain restrictions, the Noncontrolling Interests – Operating Partnership may exchange their OP Units for Common Shares on a one-for-one basis.
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
Item 4.
|
Controls and Procedures
|
Item 1.
|
Legal Proceedings
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
Item 3.
|
Defaults Upon Senior Securities
|
Item 4.
|
Mine Safety Disclosures
|
Item 5.
|
Other Information
|
Item 6.
|
Exhibits
– See the Exhibit Index.
|
|
|
|
|
|
|
|
EQUITY RESIDENTIAL
|
||||
|
|
|
|
||
Date:
|
November 5, 2015
|
|
By:
|
|
/s/ Mark J. Parrell
|
|
|
|
|
|
Mark J. Parrell
|
|
|
|
|
|
Executive Vice President and
Chief Financial Officer
|
|
|
|
|
|
(Principal Financial Officer)
|
|
|
|
|
||
|
|
|
|
||
Date:
|
November 5, 2015
|
|
By:
|
|
/s/ Ian S. Kaufman
|
|
|
|
|
|
Ian S. Kaufman
|
|
|
|
|
|
Senior Vice President and
Chief Accounting Officer
|
|
|
|
|
|
(Principal Accounting Officer)
|
|
|
|
|
||
|
ERP OPERATING LIMITED PARTNERSHIP
BY: EQUITY RESIDENTIAL
ITS GENERAL PARTNER
|
||||
|
|
|
|
||
Date:
|
November 5, 2015
|
|
By:
|
|
/s/ Mark J. Parrell
|
|
|
|
|
|
Mark J. Parrell
|
|
|
|
|
|
Executive Vice President and
Chief Financial Officer
|
|
|
|
|
|
(Principal Financial Officer)
|
|
|
|
|
||
|
|
|
|
||
Date:
|
November 5, 2015
|
|
By:
|
|
/s/ Ian S. Kaufman
|
|
|
|
|
|
Ian S. Kaufman
|
|
|
|
|
|
Senior Vice President and
Chief Accounting Officer
|
|
|
|
|
|
(Principal Accounting Officer)
|
Exhibit
|
|
Description
|
|
Location
|
|
|
|
|
|
2.1
|
|
Real Estate Sale Agreement dated as of October 23, 2015, by and among ERP Operating Limited Partnership, certain of its affiliates, and SCG Atlas Acquisition, L.P. (the "Sale Agreement").
|
|
Included as Exhibit 2.1 to Equity Residential's and ERP Operating Limited Partnership's Form 8-K dated October 23, 2015, filed on October 26, 2015.
|
|
|
|
|
|
2.2
|
|
Schedule of Agreements Substantially Identical in all Material Respects to the Sale Agreement.
|
|
Included as Exhibit 2.2 to Equity Residential's and ERP Operating Limited Partnership's Form 8-K dated October 23, 2015, filed on October 26, 2015.
|
|
|
|
|
|
3.1
|
|
Eighth Amended and Restated Bylaws of Equity Residential, effective October 1, 2015.
|
|
Included as Exhibit 3.1 to Equity Residential's Form 8-K dated and filed on October 1, 2015.
|
|
|
|
|
|
12
|
|
Computation of Ratio of Earnings to Combined Fixed Charges.
|
|
Attached herein.
|
|
|
|
|
|
31.1
|
|
Equity Residential – Certification of David J. Neithercut, Chief Executive Officer.
|
|
Attached herein.
|
|
|
|
|
|
31.2
|
|
Equity Residential – Certification of Mark J. Parrell, Chief Financial Officer.
|
|
Attached herein.
|
|
|
|
|
|
31.3
|
|
ERP Operating Limited Partnership – Certification of David J. Neithercut, Chief Executive Officer of Registrant’s General Partner.
|
|
Attached herein.
|
|
|
|
|
|
31.4
|
|
ERP Operating Limited Partnership – Certification of Mark J. Parrell, Chief Financial Officer of Registrant’s General Partner.
|
|
Attached herein.
|
|
|
|
|
|
32.1
|
|
Equity Residential – Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of David J. Neithercut, Chief Executive Officer of the Company.
|
|
Attached herein.
|
|
|
|
|
|
32.2
|
|
Equity Residential – Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of Mark J. Parrell, Chief Financial Officer of the Company.
|
|
Attached herein.
|
|
|
|
|
|
32.3
|
|
ERP Operating Limited Partnership – Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of David J. Neithercut, Chief Executive Officer of Registrant’s General Partner.
|
|
Attached herein.
|
|
|
|
|
|
32.4
|
|
ERP Operating Limited Partnership – Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, of Mark J. Parrell, Chief Financial Officer of Registrant’s General Partner.
|
|
Attached herein.
|
|
|
|
|
|
101
|
|
XBRL (Extensible Business Reporting Language). The following materials from Equity Residential’s and ERP Operating Limited Partnership’s Quarterly Report on Form 10-Q for the period ended September 30, 2015, formatted in XBRL: (i) consolidated balance sheets, (ii) consolidated statements of operations and comprehensive income, (iii) consolidated statements of cash flows, (iv) consolidated statement of changes in equity (Equity Residential), (v) consolidated statement of changes in capital (ERP Operating Limited Partnership) and (vi) notes to consolidated financial statements.
|
|
Attached herein.
|
No information found
* THE VALUE IS THE MARKET VALUE AS OF THE LAST DAY OF THE QUARTER FOR WHICH THE 13F WAS FILED.
FUND | NUMBER OF SHARES | VALUE ($) | PUT OR CALL |
---|
DIRECTORS | AGE | BIO | OTHER DIRECTOR MEMBERSHIPS |
---|---|---|---|
Tahsinul Zia Huque served as the President and Chief Executive Officer of Deutsche Bank Securities Inc., the U.S. Broker Dealer of Deutsche Bank, from May 2018 until his departure from Wall Street in mid-2019. At Deutsche Bank, Mr. Huque was Head of Equities, Fixed Income & Currencies for the Americas from February 2016 until May 2018 and Global Co-Chief Operating Officer of Corporate Banking and Securities from March 2012 until February 2016. During Mr. Huque’s 30-year finance career on Wall Street, he held multiple executive positions in the United States and abroad while leading investment banking and sales and trading functions spanning many industries, products and clients. Also during his career, he was closely involved in creating the structure for public REITs to access the unsecured debt market. Mr. Huque received his B.A. in Economics and in Political Science from Williams College. He is currently a private investor and served as a director of Energy Vault (NYSE: NRGV) until March 2024. He also is a general partner of Prime Movers Lab, a venture capital fund focused on scientific and engineering innovations in technology, and serves on various private company boards in connection therewith. Qualifications • Proven leader of large, complex, high performing and competitive organizations • Extensive global finance and innovation experience at an executive leadership position across multiple markets, clients, products, technologies and risk parameters • Deep technical regulatory experience as CEO or COO of international investment banking organizations with multijurisdictional regulatory requirements | |||
Stephen E. Sterrett , our Lead Trustee since 2020, served as the Senior Executive Vice President and Chief Financial Officer of Simon Property Group, Inc. (NYSE: SPG), an owner of shopping, dining, entertainment and mixed-use destinations, one of the largest REITs in the world by equity market capitalization and a S&P 100 company, until his retirement in December 2014. He spent more than 26 years in various positions at Simon and its predecessor companies and had served as the company’s Chief Financial Officer since 2000. Prior to joining Simon, Mr. Sterrett was a Senior Manager at the international firm of Price Waterhouse. Mr. Sterrett serves as chairman of Berry Global Group, Inc. ("Berry") (NYSE: BERY) and will serve as deputy chairman of Amcor plc ("Amcor") (NYSE: AMCR, ASX: AMC) following the merger of Berry and Amcor, which is expected to occur mid-2025. He was a director of Realty Income Corporation (NYSE: O) until May 2019. Mr. Sterrett also serves on the Board of Trustees of Butler University and of the FirstTee, a youth development organization. Mr. Sterrett received an M.B.A. from Indiana University. Qualifications • Extraordinarily equipped with wide-ranging knowledge in real estate and public company matters • Executive leadership experience and expertise in financial, risk assessment, operational, governance and strategic issues facing large real estate companies • Audit committee financial expert, based on prior experience as a CFO | |||
Nina P. Jones has over 15 years of real estate investing experience at T. Rowe Price, a global investment manager with over $1 trillion in assets under management. She most recently served as Vice President, Portfolio Manager, of the T. Rowe Price U.S. Real Estate Equity Strategy until her retirement in December 2023. Ms. Jones also served as global team leader for real estate at T. Rowe Price, including as portfolio manager of the Global Real Estate Equity Strategy. She was an Investment Advisory Committee member of the Mid-Cap Value, Institutional Large-Cap Value, Global Growth, Global Stock and Financial Services strategies. Prior to T. Rowe, Ms. Jones worked as a Senior Associate in Audit and Risk Advisory for KPMG, earning the CPA designation. She currently serves as a director of Simon Property Group (NYSE: SPG). Ms. Jones received a B.S. in Accounting and Finance from the University of Maryland and an M.B.A. from the Columbia University Graduate School of Business. Qualifications • Extensive experience analyzing and investing in real estate companies • Deep engagement with management and boards regarding industry and company-specific risks, proxy voting and corporate responsibility concerns • Audit committee financial expert, based on accounting and finance background | |||
Mary Kay Haben served as the President-North America for the Wm. Wrigley Jr. Company, a leading confectionary company, until her retirement in February 2011. At Wrigley, Ms. Haben drove growth through new product and packaging innovation, as well as marketing efforts in emerging digital media. Prior to joining Wrigley in 2007, Ms. Haben held various executive positions during her 27-year career at Kraft Foods Inc. These included leading significant business divisions and functions for Kraft, driving bottom line growth through marketing innovation and brand positioning efforts, as well as acquisitions and productivity initiatives. She serves as a director of The Hershey Company (NYSE: HSY) and Grocery Outlet (NASDAQ: GO), is Chair of the University of Michigan Alumni Association and formerly served as a director of Bob Evans Farms, Inc. (NASDAQ: BOBE) until its sale in January 2018. She was named to the 2020 National Association of Corporate Directors Directorship 100™, which honors the most influential boardroom leaders each year. Ms. Haben received an M.B.A. from the University of Michigan Ross School of Business. | |||
Mark S. Shapiro has served as President and Managing Partner of WME Group, a global talent and media agency, since March 2025 and served as President (since December 2018) and Chief Operating Officer (since April 2023) of Endeavor, its predecessor. Prior to joining Endeavor's IMG subsidiary in 2014, he held various executive positions, including Chief Executive Officer, at Dick Clark Productions, an independent producer of television programming, from May 2010 to September 2014. Mr. Shapiro was the Chief Executive Officer and a director of Six Flags, Inc., the world’s largest regional theme park company, from December 2005 through May 2010. Prior to joining Six Flags, Inc., Mr. Shapiro spent 12 years at ESPN, Inc., where he ultimately served as Executive Vice President, Programming and Production and had significant responsibility in building the strength of the network’s brand which garnered numerous Emmy and Peabody awards. Mr. Shapiro has also served as President, Chief Operating Officer and a director of TKO Group Holdings, Inc. (NYSE: TKO), a premium sports and entertainment company which operates leading premium sports and entertainment brands and is majority owned by Endeavor, since September 2023. He serves as Chairman of the Board of Captivate Network, a private company. Additionally, Mr. Shapiro serves on the Board of Directors of The Shaquille O'Neal Foundation. He was a director of the Tribune Company, Frontier Communications Corporation (NASDAQ: FTR) until May 2019, Papa John’s International, Inc. (NASDAQ: PZZA) until April 2019, Live Nation Entertainment, Inc. (NYSE: LYV) until June 2021 and Bright Lights Acquisition Corp. (NASDAQ: BLTS) until December 2022. | |||
Linda Walker Bynoe has been President and Chief Executive Officer of Telemat Limited LLC (formerly, Telemat Ltd.), a management consulting firm, since 1995 and served as its Chief Operating Officer from 1989 through 1994. Ms. Bynoe served as a Vice President – Capital Markets for Morgan Stanley from 1985 to 1989, joining the firm in 1978. Ms. Bynoe serves as a director of Northern Trust Corporation (NASDAQ: NTRS) and PGIM Funds (formerly, Prudential Retail Mutual Funds). She served as a director of Simon Property Group, Inc. (NYSE: SPG) until May 2012 and Anixter International, Inc. (NYSE: AXE) until its sale to WESCO International, Inc. in June 2020. Ms. Bynoe received an M.B.A. from Harvard Business School. | |||
John E. Neal has over 30 years of experience in executive positions in the financial services and banking industries with a primary focus on real estate finance, including leading the real estate lending and corporate banking businesses at Bank One Corporation, Kemper Financial Services and Continental Bank. He retired as a partner of Linden LLC, a private equity firm, in October 2018. Mr. Neal serves as a trustee of the Calamos Mutual Funds and also serves on the boards of private companies in a wide array of industries. He received an M.B.A. from Harvard Business School. | |||
David J. Neithercut , our Chairman since May 2023, served as Chief Executive Officer of the Company from January 2006 until his retirement in December 2018 and President of the Company from May 2005 to September 2018. He was Executive Vice President – Corporate Strategy of the Company from January 2004 to May 2005, and Executive Vice President and Chief Financial Officer of the Company from February 1995 to August 2004. Prior to joining Equity Residential, Mr. Neithercut served as Senior Vice President of Finance for Equity Group Investments. He serves as a director of Americold Realty Trust (NYSE: COLD), was a director of General Growth Properties, Inc. (NYSE: GGP) until May 2017 and was lead independent trustee of Public Storage (NYSE: PSA) until May 2024. Mr. Neithercut is a former member of the Advisory Board of Governors of Nareit, of which he served as Chairman in 2015. He received Nareit’s 2018 Industry Leadership Award, honoring a REIT executive who has made a significant and lasting contribution to the growth and betterment of the industry. Mr. Neithercut received an M.B.A. from the Columbia University Graduate School of Business. Qualifications • Recognized as a leading industry authority in real estate investments, operations and capital markets • Long and successful track record in various leadership roles at the Company and other organizations • Highly experienced in dealing with complex management, financial, risk assessment, business and governance issues | |||
Ann C. Hoff has served as President and Chief Operating Officer of Bellagio and Park MGM at MGM Resorts International (NYSE: MGM), a global gaming and entertainment company, since December 2020, where she oversees all aspects of operations for two casino resort destinations. She will be retiring from such position in June 2025. From April 2020 to December 2020, she served as Chief Marketing Officer at MGM, where she was responsible for overseeing the company's brand, public relations, creative, sales, guest experience and direct marketing efforts. From March 2019 to April 2020, Ms. Hoff served as President and Chief Operating Officer of Portfolio Properties at MGM, where she led strategic direction and worked closely with the Presidents/COOs of The Mirage, New York-New York, Luxor, Excalibur, as well as the Retail and Hotel Centers of Excellence for the entire enterprise, and has held various operating and marketing positions at MGM since joining the organization in 1990. She is involved in numerous professional and charitable organizations, currently serving on the Board of Trustees at Southern Hills Hospital, the Board of Directors of the Las Vegas Convention and Visitors Authority, including vice chair of the compensation committee, and the Advisory Board of the University of Nevada, Las Vegas ("UNLV") William F. Harrah College of Hospitality. Ms. Hoff received a B.S. in Hotel and Restaurant Management from UNLV. | |||
Angela M. Aman has served as Chief Executive Officer and a director of Kilroy Realty Corporation (NYSE: KRC), a REIT active in premier office, life science and mixed-use properties in the United States, since January 2024. From September 2023 to January 2024, she served as President, Chief Financial Officer and Treasurer and from May 2016 to September 2023, she served as Executive Vice President, Chief Financial Officer and Treasurer of Brixmor Property Group (NYSE: BRX), a REIT that owns and operates a national portfolio of open-air shopping centers. Prior to Brixmor, she held Chief Financial Officer roles at Starwood Retail Partners from 2015 to 2016 and Retail Properties of America, Inc. from 2011 to 2015. From 2005 to 2011, she was a member of the RREEF real estate securities team, serving as an analyst and later as a Portfolio Manager, and from 2001 to 2005, she was a member of the real estate investment banking group at Deutsche Bank Securities, Inc. Ms. Aman serves as a member of the Executive Committee for the Zell/Lurie Real Estate Center at the Wharton School, University of Pennsylvania, a member of the Board of Advisors for the Anderson School of Management at UCLA and Audit Committee Chair for Nareit. Ms. Aman received a B.S. in Economics from the Wharton School, University of Pennsylvania. Qualifications • Extensive experience in real estate and public company matters, including as an equity investor • Executive leadership experience and expertise in financial, governance, information technology and strategic issues facing large real estate companies • Audit committee financial expert, based on experience as a CFO |
No Customers Found
Price
Yield
Owner | Position | Direct Shares | Indirect Shares |
---|---|---|---|
ZELL SAMUEL | - | 767,444 | 154,480 |
Brackenridge Alexander | - | 73,928 | 3,353 |
Brackenridge Alexander | - | 53,404 | 3,215 |
Altshuler Barry | - | 44,721 | 62 |
Fenster Scott | - | 33,193 | 2,271 |
Fenster Scott | - | 27,029 | 321 |
Manelis Michael L | - | 26,053 | 1,326 |
Kaufman Ian | - | 25,683 | 622 |
Manelis Michael L | - | 22,844 | 1,326 |
BYNOE LINDA | - | 20,112 | 23,275 |
Kaufman Ian | - | 19,965 | 579 |
STERRETT STEPHEN E | - | 19,395 | 20,306 |
Garechana Robert | - | 14,112 | 7,093 |
Carraway Catherine | - | 12,746 | 7,612 |
SHAPIRO MARK S | - | 12,497 | 4,701 |
HABEN MARY KAY | - | 9,720 | 17,476 |
NEITHERCUT DAVID J | - | 3,392 | 56,464 |
Hoff Ann | - | 588 | 0 |