Reportable Segments

3 Months Ended

Mar. 31, 2023

Segment Reporting [Abstract]

Reportable Segments

13.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 3.8% of total revenues for the quarter ended March 31, 2023 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 quarters ended March 31, 2023 and 2022, 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 quarters ended March 31, 2023 and 2022, respectively (amounts in thousands):

	Quarter Ended March 31,
	2023			2022
Rental income	$	705,088		$	653,348
Property and maintenance expense		(137,579	)		(124,874	)
Real estate taxes and insurance expense		(106,669	)		(100,688	)
Total operating expenses		(244,248	)		(225,562	)
Net operating income	$	460,840		$	427,786

The following tables present NOI from our rental real estate for each segment for the quarters ended March 31, 2023 and 2022, respectively, as well as total assets and capital expenditures at March 31, 2023 (amounts in thousands):

	Quarter Ended March 31, 2023							Quarter Ended March 31, 2022
	Rental Income		Operating Expenses		NOI			Rental Income		Operating Expenses		NOI
Same store (1)
Los Angeles	$	115,681	$	37,801	$	77,880		$	108,969	$	34,184	$	74,785
Orange County		31,588		7,187		24,401			28,767		6,531		22,236
San Diego		22,441		5,189		17,252			20,940		4,952		15,988
Subtotal - Southern California		169,710		50,177		119,533			158,676		45,667		113,009
San Francisco		107,479		34,005		73,474			100,616		31,673		68,943
Washington, D.C.		107,623		36,268		71,355			100,705		34,211		66,494
New York		118,045		49,771		68,274			99,830		47,875		51,955
Seattle		74,561		20,479		54,082			68,537		19,927		48,610
Boston		70,658		22,636		48,022			64,663		21,059		43,604
Denver		17,597		5,491		12,106			16,232		4,633		11,599
Other Expansion Markets		16,002		7,963		8,039			15,107		6,490		8,617
Total same store		681,675		226,790		454,885			624,366		211,535		412,831
Non-same store/other
Non-same store (2)		20,970		7,409		13,561			15,050		7,752		7,298
Other (3)		2,443		10,049		(7,606	)		13,932		6,275		7,657
Total non-same store/other		23,413		17,458		5,955			28,982		14,027		14,955
Totals	$	705,088	$	244,248	$	460,840		$	653,348	$	225,562	$	427,786

(1)For the quarters ended March 31, 2023 and 2022, same store primarily includes all properties acquired or completed that were stabilized prior to January 1, 2022, less properties subsequently sold, which represented 76,952 apartment units.

(2)For the quarters ended March 31, 2023 and 2022, non-same store primarily includes properties acquired after January 1, 2022, plus any properties in lease-up and not stabilized as of January 1, 2022, and any properties undergoing major renovations.

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

	Quarter Ended March 31, 2023
	Total Assets		Capital Expenditures
Same store (1)
Los Angeles	$	2,536,079	$	8,189
Orange County		352,643		1,678
San Diego		229,293		4,055
Subtotal - Southern California		3,118,015		13,922
San Francisco		3,046,849		7,954
Washington, D.C.		3,064,106		8,674
New York		3,377,729		5,450
Seattle		2,157,123		5,311
Boston		1,792,839		5,145
Denver		848,783		561
Other Expansion Markets		803,845		1,120
Total same store		18,209,289		48,137
Non-same store/other
Non-same store (2)		1,007,584		7,196
Other (3)		885,653		59
Total non-same store/other		1,893,237		7,255
Totals	$	20,102,526	$	55,392

(1)Same store primarily includes all properties acquired or completed that were stabilized prior to January 1, 2022, less properties subsequently sold, which represented 76,952 apartment units.

(2)Non-same store primarily includes properties acquired after January 1, 2022, plus any properties in lease-up and not stabilized as of January 1, 2022, and any properties undergoing major renovations.

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