Reportable Segments

12 Months Ended

Dec. 31, 2022

Segment Reporting [Abstract]

Reportable Segments

17.Reportable Segments

Operating segments are defined as components of an enterprise that engage in business activities from which they may earn revenues and incur expenses and about which discrete financial information is available that is evaluated regularly by the chief operating decision maker. The chief operating decision maker decides how resources are allocated and assesses performance on a recurring basis at least quarterly.

The Company’s primary business is the acquisition, development and management of multifamily residential properties, which includes the generation of rental and other related income through the leasing of apartment units to residents. The chief operating decision maker evaluates the Company’s operating performance geographically by market and both on a same store and non-same store basis. While the Company does maintain a non-residential presence, it accounts for approximately 3.7% of total revenues for the year ended December 31, 2022 and is designed as an amenity for our residential residents. The chief operating decision maker evaluates the performance of each property on a consolidated residential and non-residential basis. The Company’s geographic consolidated same store operating segments represent its reportable segments.

The Company’s development activities are other business activities that do not constitute an operating segment and as such, have been aggregated in the “Other” category in the tables presented below.

All revenues are from external customers and there is no customer who contributed 10% or more of the Company’s total revenues during the three years ended December 31, 2022, 2021 and 2020, respectively.

The primary financial measure for the Company’s rental real estate segment is net operating income (“NOI”), which represents rental income less: 1) property and maintenance expense and 2) real estate taxes and insurance expense (all as reflected in the accompanying consolidated statements of operations and comprehensive income). The Company believes that NOI is helpful to investors as a supplemental measure of its operating performance because it is a direct measure of the actual operating results of the Company’s apartment properties. Revenues for all leases are reflected on a straight-line basis in accordance with GAAP for the current and comparable periods.

The following table presents a reconciliation of NOI from our rental real estate for the years ended December 31, 2022, 2021 and 2020, respectively (amounts in thousands):

	Year Ended December 31,
	2022			2021			2020
Rental income	$	2,735,180		$	2,463,997		$	2,571,705
Property and maintenance expense		(483,865	)		(453,532	)		(440,998	)
Real estate taxes and insurance expense		(388,412	)		(397,105	)		(381,562	)
Total operating expenses		(872,277	)		(850,637	)		(822,560	)
Net operating income	$	1,862,903		$	1,613,360		$	1,749,145

The following tables present NOI from our rental real estate for each segment for the years ended December 31, 2022, 2021 and 2020, respectively, as well as total assets and capital expenditures at December 31, 2022 and 2021, respectively (amounts in thousands):

	Year Ended December 31, 2022							Year Ended December 31, 2021						Year Ended December 31, 2020
	Rental Income		Operating Expenses			NOI		Rental Income		Operating Expenses		NOI		Rental Income		Operating Expenses		NOI
Same store (1)
Los Angeles	$	469,180	$	137,078		$	332,102	$	431,954	$	132,274	$	299,680	$	444,129	$	140,469	$	303,660
Orange County		122,660		26,338			96,322		109,427		24,986		84,441		105,236		24,545		80,691
San Diego		86,728		19,395			67,333		78,709		18,395		60,314		74,737		18,176		56,561
Subtotal - Southern California		678,568		182,811			495,757		620,090		175,655		444,435		624,102		183,190		440,912
San Francisco		418,941		124,952			293,989		383,817		118,795		265,022		435,371		117,085		318,286
Washington, D.C.		411,975		136,130			275,845		389,205		129,065		260,140		405,571		125,353		280,218
New York		434,820		186,896			247,924		367,370		182,631		184,739		424,534		197,740		226,794
Seattle		282,902		79,101			203,801		256,988		80,775		176,213		257,372		74,362		183,010
Boston		262,604		79,979			182,625		235,050		76,374		158,676		240,158		71,611		168,547
Denver		43,767		12,422			31,345		39,084		11,209		27,875		37,917		11,040		26,877
Total same store		2,533,577		802,291			1,731,286		2,291,604		774,504		1,517,100		2,425,025		780,381		1,644,644
Non-same store/other
Non-same store (2)		179,707		70,654			109,053		59,629		27,691		31,938		11,791		2,706		9,085
Other (3)		21,896		(668	)		22,564		112,764		48,442		64,322		134,889		39,473		95,416
Total non-same store/other		201,603		69,986			131,617		172,393		76,133		96,260		146,680		42,179		104,501
Totals	$	2,735,180	$	872,277		$	1,862,903	$	2,463,997	$	850,637	$	1,613,360	$	2,571,705	$	822,560	$	1,749,145

(1)For the years ended December 31, 2022 and 2021, same store primarily includes all properties acquired or completed that were stabilized prior to January 1, 2021, less properties subsequently sold, which represented 72,872 apartment units. For the year ended December 31, 2020, same store primarily includes all properties acquired or completed that were stabilized prior to January 1, 2020, less properties subsequently sold, which represented 74,077 apartment units.

(2)For the years ended December 31, 2022 and 2021, non-same store primarily includes properties acquired after January 1, 2021, plus any properties in lease-up and not stabilized as of January 1, 2021, and any properties undergoing major renovations. For the year ended December 31, 2020, non-same store primarily includes properties acquired after January 1, 2020, plus any properties in lease-up and not stabilized as of January 1, 2020, and any properties undergoing major renovations.

(3)Other includes development, other corporate operations and operations prior to disposition for properties sold.

	Year Ended December 31, 2022				Year Ended December 31, 2021
	Total Assets		Capital Expenditures		Total Assets		Capital Expenditures
Same store (1)
Los Angeles	$	2,590,661	$	35,481	$	2,668,136	$	20,917
Orange County		356,396		7,885		371,063		5,647
San Diego		228,471		8,798		232,345		2,899
Subtotal - Southern California		3,175,528		52,164		3,271,544		29,463
San Francisco		3,068,951		33,854		3,165,347		20,021
Washington, D.C.		3,027,549		34,174		3,134,677		27,061
New York		3,421,373		21,636		3,513,047		28,742
Seattle		2,076,320		28,086		2,140,925		15,203
Boston		1,676,783		23,057		1,739,184		21,129
Denver		473,127		2,139		492,454		2,015
Total same store		16,919,631		195,110		17,457,178		143,634
Non-same store/other
Non-same store (2)		2,501,008		25,429		2,439,634		4,491
Other (3)		797,623		547		1,272,429		2,894
Total non-same store/other		3,298,631		25,976		3,712,063		7,385
Totals	$	20,218,262	$	221,086	$	21,169,241	$	151,019

(1)Same store primarily includes all properties acquired or completed that were stabilized prior to January 1, 2021, less properties subsequently sold, which represented 72,872 apartment units.

(2)Non-same store primarily includes properties acquired after January 1, 2021, plus any properties in lease-up and not stabilized as of January 1, 2021, and any properties undergoing major renovations.

(3)Other includes development, other corporate operations and capital expenditures for properties sold.