Reportable Segments

9 Months Ended

Sep. 30, 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 less than 4.0% of total revenues for the nine months ended September 30, 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 nine months and quarters ended September 30, 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 nine months and quarters ended September 30, 2023 and 2022, respectively (amounts in thousands):

	Nine Months Ended September 30,						Quarter Ended September 30,
	2023			2022			2023			2022
Rental income	$	2,146,464		$	2,035,477		$	724,067		$	695,099
Property and maintenance expense		(391,437	)		(365,277	)		(129,087	)		(124,048	)
Real estate taxes and insurance expense		(312,607	)		(302,899	)		(102,858	)		(100,361	)
Total operating expenses		(704,044	)		(668,176	)		(231,945	)		(224,409	)
Net operating income	$	1,442,420		$	1,367,301		$	492,122		$	470,690

The following tables present NOI from our rental real estate for each segment for the nine months and quarters ended September 30, 2023 and 2022, respectively, as well as total assets and capital expenditures at September 30, 2023 (amounts in thousands):

	Nine Months Ended September 30, 2023							Nine Months Ended September 30, 2022
	Rental Income		Operating Expenses		NOI			Rental Income		Operating Expenses		NOI
Same store (1)
Los Angeles	$	355,341	$	110,436	$	244,905		$	344,579	$	101,441	$	243,138
Orange County		96,923		21,689		75,234			91,270		19,804		71,466
San Diego		68,904		15,586		53,318			64,540		14,646		49,894
Subtotal - Southern California		521,168		147,711		373,457			500,389		135,891		364,498
San Francisco		325,335		98,848		226,487			312,401		93,778		218,623
Washington, D.C.		329,196		106,687		222,509			310,071		104,515		205,556
New York		356,157		146,415		209,742			318,757		140,696		178,061
Seattle		220,353		62,621		157,732			211,040		59,858		151,182
Boston		215,667		64,156		151,511			200,808		61,934		138,874
Denver		53,324		15,883		37,441			50,284		14,463		35,821
Other Expansion Markets		48,656		22,286		26,370			45,998		20,146		25,852
Total same store		2,069,856		664,607		1,405,249			1,949,748		631,281		1,318,467
Non-same store/other
Non-same store (2)		70,736		26,946		43,790			53,449		22,429		31,020
Other (3)		5,872		12,491		(6,619	)		32,280		14,466		17,814
Total non-same store/other		76,608		39,437		37,171			85,729		36,895		48,834
Totals	$	2,146,464	$	704,044	$	1,442,420		$	2,035,477	$	668,176	$	1,367,301

(1)For the nine months ended September 30, 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 76,789 apartment units.

(2)For the nine months ended September 30, 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 September 30, 2023							Quarter Ended September 30, 2022
	Rental Income		Operating Expenses		NOI			Rental Income		Operating Expenses		NOI
Same store (1)
Los Angeles	$	121,098	$	36,839	$	84,259		$	116,770	$	34,198	$	82,572
Orange County		33,019		7,316		25,703			31,252		6,792		24,460
San Diego		25,258		5,803		19,455			23,860		5,634		18,226
Subtotal - Southern California		179,375		49,958		129,417			171,882		46,624		125,258
San Francisco		109,215		32,782		76,433			106,382		32,025		74,357
Washington, D.C.		114,748		36,521		78,227			108,667		37,073		71,594
New York		118,326		48,555		69,771			112,595		46,755		65,840
Seattle		73,351		21,575		51,776			73,096		20,258		52,838
Boston		72,541		20,773		51,768			69,029		20,860		48,169
Denver		17,855		5,384		12,471			17,219		5,132		12,087
Other Expansion Markets		18,679		7,926		10,753			17,517		8,008		9,509
Total same store		704,090		223,474		480,616			676,387		216,735		459,652
Non-same store/other
Non-same store (2)		19,035		7,279		11,756			13,343		4,544		8,799
Other (3)		942		1,192		(250	)		5,369		3,130		2,239
Total non-same store/other		19,977		8,471		11,506			18,712		7,674		11,038
Totals	$	724,067	$	231,945	$	492,122		$	695,099	$	224,409	$	470,690

(1)For the quarters ended September 30, 2023 and 2022, same store primarily includes all properties acquired or completed that were stabilized prior to July 1, 2022, less properties subsequently sold, which represented 77,698 apartment units.

(2)For the quarters ended September 30, 2023 and 2022, non-same store primarily includes properties acquired after July 1, 2022, plus any properties in lease-up and not stabilized as of July 1, 2022, and any properties undergoing major renovations.

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

	Nine Months Ended September 30, 2023
	Total Assets		Capital Expenditures
Same store (1)
Los Angeles	$	2,509,235	$	38,810
Orange County		345,945		6,611
San Diego		230,902		12,921
Subtotal - Southern California		3,086,082		58,342
San Francisco		3,006,656		36,261
Washington, D.C.		3,023,064		39,086
New York		3,328,321		16,248
Seattle		2,092,677		23,176
Boston		1,762,350		22,430
Denver		832,017		2,547
Other Expansion Markets		790,180		4,117
Total same store		17,921,347		202,207
Non-same store/other
Non-same store (2)		1,502,692		27,291
Other (3)		684,936		265
Total non-same store/other		2,187,628		27,556
Totals	$	20,108,975	$	229,763

(1)Same store primarily includes all properties acquired or completed that were stabilized prior to January 1, 2022, less properties subsequently sold, which represented 76,789 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.