Earning Per Share and Earnings Per Unit

Equity Residential

The following tables set forth the computation of net income per share – basic and net income per share – diluted for the Company (amounts in thousands except per share amounts):



	Quarter Ended March 31,
	2012			2011
Numerator for net income per share – basic:
Income (loss) from continuing operations	$	17,389		$	(8,913	)
Allocation to Noncontrolling Interests – Operating Partnership, net	(582		)	543
Net (income) loss attributable to Noncontrolling Interests – Partially Owned Properties	(450		)	40
Preferred distributions	(3,466		)	(3,466		)
Income (loss) from continuing operations available to Common Shares, net of Noncontrolling Interests	12,891			(11,796		)
Discontinued operations, net of Noncontrolling Interests	128,942			135,661
Numerator for net income per share – basic	$	141,833		$	123,865
Numerator for net income per share – diluted (1):
Income from continuing operations	$	17,389
Net (income) attributable to Noncontrolling Interests – Partially Owned Properties	(450		)
Preferred distributions	(3,466		)
Income from continuing operations available to Common Shares	13,473
Discontinued operations, net	134,778
Numerator for net income per share – diluted (1)	$	148,251		$	123,865
Denominator for net income per share – basic and diluted (1):
Denominator for net income per share – basic	298,805			292,895
Effect of dilutive securities:
OP Units	13,206
Long-term compensation shares/units	3,219
Denominator for net income per share – diluted (1)	315,230			292,895
Net income per share – basic	$	0.47		$	0.42
Net income per share – diluted	$	0.47		$	0.42
Net income per share – basic:
Income (loss) from continuing operations available to Common Shares, net of Noncontrolling Interests	$	0.043		$	(0.040	)
Discontinued operations, net of Noncontrolling Interests	0.432			0.463
Net income per share – basic	$	0.475		$	0.423
Net income per share – diluted (1):
Income (loss) from continuing operations available to Common Shares	$	0.043		$	(0.040	)
Discontinued operations, net	0.427			0.463
Net income per share – diluted	$	0.470		$	0.423


(1)	Potential common shares issuable from the assumed conversion of OP Units and the exercise/vesting of long-term compensation shares/units are automatically anti-dilutive and therefore excluded from the diluted earnings per share calculation as the Company had a loss from continuing operations for the quarter ended March 31, 2011.

The effect of the Common Shares that could ultimately be issued upon the conversion/exchange of the Company’s $650.0 million exchangeable senior notes ($482.5 million outstanding were redeemed on August 18, 2011) was not included in the computation of diluted earnings per share because the effects would be anti-dilutive.

ERP Operating Limited Partnership

The following tables set forth the computation of net income per Unit – basic and net income per Unit – diluted for the Operating Partnership (amounts in thousands except per Unit amounts):



	Quarter Ended March 31,
	2012			2011
Numerator for net income per Unit – basic and diluted (1):
Income (loss) from continuing operations	$	17,389		$	(8,913	)
Net (income) loss attributable to Noncontrolling Interests – Partially Owned Properties	(450		)	40
Allocation to Preference Units	(3,466		)	(3,466		)
Income (loss) from continuing operations available to Units	13,473			(12,339		)
Discontinued operations, net	134,778			141,979
Numerator for net income per Unit – basic and diluted (1)	$	148,251		$	129,640
Denominator for net income per Unit – basic and diluted (1):
Denominator for net income per Unit – basic	312,011			306,248
Effect of dilutive securities:
Dilution for Units issuable upon assumed exercise/vesting of the Company’s long-term compensation shares/units	3,219
Denominator for net income per Unit – diluted (1)	315,230			306,248
Net income per Unit – basic	$	0.47		$	0.42
Net income per Unit – diluted	$	0.47		$	0.42
Net income per Unit – basic:
Income (loss) from continuing operations available to Units	$	0.043		$	(0.040	)
Discontinued operations, net	0.432			0.463
Net income per Unit – basic	$	0.475		$	0.423
Net income per Unit – diluted (1):
Income (loss) from continuing operations available to Units	$	0.043		$	(0.040	)
Discontinued operations, net	0.427			0.463
Net income per Unit – diluted	$	0.470		$	0.423


(1)	Potential Units issuable from the assumed exercise/vesting of the Company’s long-term compensation shares/units are automatically anti-dilutive and therefore excluded from the diluted earnings per Unit calculation as the Operating Partnership had a loss from continuing operations for the quarter ended March 31, 2011.

The effect of the Common Shares/OP Units that could ultimately be issued upon the conversion/exchange of the Company’s $650.0 million exchangeable senior notes ($482.5 million outstanding were redeemed on August 18, 2011) was not included in the computation of diluted earnings per Unit because the effects would be anti-dilutive.