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Reportable Segments
3 Months Ended
Mar. 31, 2024
Segment Reporting [Abstract]  
Reportable Segments
12.
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 5.0% of total revenues for the quarter ended March 31, 2024 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, 2024 and 2023, 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, 2024 and 2023, respectively (amounts in thousands):

 

 

 

Quarter Ended March 31,

 

 

 

2024

 

 

2023

 

Rental income

 

$

730,818

 

 

$

705,088

 

Property and maintenance expense

 

 

(134,630

)

 

 

(137,579

)

Real estate taxes and insurance expense

 

 

(108,927

)

 

 

(106,669

)

Total operating expenses

 

 

(243,557

)

 

 

(244,248

)

Net operating income

 

$

487,261

 

 

$

460,840

 

The following tables present NOI from our rental real estate for each segment for the quarters ended March 31, 2024 and 2023, respectively, as well as total assets and capital expenditures at March 31, 2024 (amounts in thousands):

 

 

 

Quarter Ended March 31, 2024

 

 

Quarter Ended March 31, 2023

 

 

 

Rental
Income

 

 

Operating
Expenses

 

 

NOI

 

 

Rental
Income

 

 

Operating
Expenses

 

 

NOI

 

Same store (1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Los Angeles

 

$

119,267

 

 

$

37,825

 

 

$

81,442

 

 

$

113,489

 

 

$

37,311

 

 

$

76,178

 

Orange County

 

 

31,101

 

 

 

6,927

 

 

 

24,174

 

 

 

29,372

 

 

 

6,694

 

 

 

22,678

 

San Diego

 

 

25,824

 

 

 

5,880

 

 

 

19,944

 

 

 

24,234

 

 

 

5,814

 

 

 

18,420

 

Subtotal - Southern California

 

 

176,192

 

 

 

50,632

 

 

 

125,560

 

 

 

167,095

 

 

 

49,819

 

 

 

117,276

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Washington, D.C.

 

 

116,387

 

 

 

36,528

 

 

 

79,859

 

 

 

110,255

 

 

 

37,153

 

 

 

73,102

 

San Francisco

 

 

109,313

 

 

 

34,967

 

 

 

74,346

 

 

 

107,286

 

 

 

34,246

 

 

 

73,040

 

New York

 

 

123,964

 

 

 

51,275

 

 

 

72,689

 

 

 

118,045

 

 

 

49,488

 

 

 

68,557

 

Boston

 

 

80,451

 

 

 

23,738

 

 

 

56,713

 

 

 

76,878

 

 

 

24,163

 

 

 

52,715

 

Seattle

 

 

73,832

 

 

 

21,277

 

 

 

52,555

 

 

 

72,778

 

 

 

20,221

 

 

 

52,557

 

Denver

 

 

17,808

 

 

 

5,447

 

 

 

12,361

 

 

 

17,596

 

 

 

5,474

 

 

 

12,122

 

Other Expansion Markets

 

 

18,718

 

 

 

8,041

 

 

 

10,677

 

 

 

18,370

 

 

 

8,397

 

 

 

9,973

 

Total same store

 

 

716,665

 

 

 

231,905

 

 

 

484,760

 

 

 

688,303

 

 

 

228,961

 

 

 

459,342

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-same store/other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-same store (2)

 

 

12,948

 

 

 

6,092

 

 

 

6,856

 

 

 

4,903

 

 

 

2,860

 

 

 

2,043

 

Other (3)

 

 

1,205

 

 

 

5,560

 

 

 

(4,355

)

 

 

11,882

 

 

 

12,427

 

 

 

(545

)

Total non-same store/other

 

 

14,153

 

 

 

11,652

 

 

 

2,501

 

 

 

16,785

 

 

 

15,287

 

 

 

1,498

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Totals

 

$

730,818

 

 

$

243,557

 

 

$

487,261

 

 

$

705,088

 

 

$

244,248

 

 

$

460,840

 

 

(1)
For the quarters ended March 31, 2024 and 2023, same store primarily includes all properties acquired or completed that were stabilized prior to January 1, 2023, less properties subsequently sold, which represented 77,373 apartment units.
(2)
For the quarters ended March 31, 2024 and 2023, non-same store primarily includes properties acquired after January 1, 2023, plus any properties in lease-up and not stabilized as of January 1, 2023, 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, 2024

 

 

 

Total Assets

 

 

Capital Expenditures

 

Same store (1)

 

 

 

 

 

 

Los Angeles

 

$

2,473,271

 

 

$

11,267

 

Orange County

 

 

335,110

 

 

 

2,569

 

San Diego

 

 

336,081

 

 

 

3,167

 

Subtotal - Southern California

 

 

3,144,462

 

 

 

17,003

 

 

 

 

 

 

 

 

Washington, D.C.

 

 

3,098,097

 

 

 

12,202

 

San Francisco

 

 

3,043,672

 

 

 

13,622

 

New York

 

 

3,284,640

 

 

 

6,085

 

Boston

 

 

2,068,351

 

 

 

6,026

 

Seattle

 

 

2,061,322

 

 

 

8,590

 

Denver

 

 

816,012

 

 

 

1,007

 

Other Expansion Markets

 

 

888,330

 

 

 

1,536

 

Total same store

 

 

18,404,886

 

 

 

66,071

 

 

 

 

 

 

 

 

Non-same store/other

 

 

 

 

 

 

Non-same store (2)

 

 

665,260

 

 

 

7,381

 

Other (3)

 

 

824,651

 

 

 

68

 

Total non-same store/other

 

 

1,489,911

 

 

 

7,449

 

 

 

 

 

 

 

 

Totals

 

$

19,894,797

 

 

$

73,520

 

 

(1)
Same store primarily includes all properties acquired or completed that were stabilized prior to January 1, 2023, less properties subsequently sold, which represented 77,373 apartment units.
(2)
Non-same store primarily includes properties acquired after January 1, 2023, plus any properties in lease-up and not stabilized as of January 1, 2023, and any properties undergoing major renovations.
(3)
Other includes development, other corporate operations and capital expenditures for properties sold.