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Second Quarter 2020 Results

Table of Contents

Earnings Release	1 - 4
Consolidated Statements of Operations	5
Consolidated Statements of Funds From Operations and Normalized Funds From Operations	6
Consolidated Balance Sheets	7
Portfolio Summary	8
Portfolio Rollforward	9
Same Store Results	10 - 16
Debt Summary	17 - 19
Capital Structure	20
Common Share and Unit Weighted Average Amounts Outstanding	21
Development and Lease-Up Projects	22
Capital Expenditures to Real Estate	23
Normalized EBITDAre Reconciliations	24
Adjustments from FFO to Normalized FFO	25
Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms	26 - 31

Corporate Headquarters:
Two North Riverside Plaza
Chicago, IL 60606
(312) 474-1300

Information included in this supplemental package is unaudited.

NEWS RELEASE - FOR IMMEDIATE RELEASE

July 28, 2020

Equity Residential Reports Second Quarter 2020 Results

Chicago, IL – July 28, 2020 - Equity Residential (NYSE: EQR) today reported results for the quarter and six months ended June 30, 2020.

Second Quarter 2020 Results

All per share results are reported as available to common shares/units on a diluted basis.

	Quarter Ended June 30,
	2020		2019		$ Change			% Change
Earnings Per Share (EPS)	$	0.70	$	0.83	$	(0.13	)		(15.7	%)
Funds from Operations (FFO) per share	$	0.86	$	0.80	$	0.06			7.5	%
Normalized FFO per share	$	0.86	$	0.86	$	—			—

	Six Months Ended June 30,
	2020		2019		$ Change		% Change
Earnings Per Share (EPS)	$	1.53	$	1.11	$	0.42		37.8	%
Funds from Operations (FFO) per share	$	1.72	$	1.61	$	0.11		6.8	%
Normalized FFO per share	$	1.72	$	1.67	$	0.05		3.0	%

“These challenging times have brought out the best in the Equity Residential team as we serve our fellow employees, residents and communities.  We could not be prouder or more grateful,” said Mark J. Parrell, Equity Residential’s President and CEO. “We see good demand for our apartments, both urban and suburban, but with increased customer price sensitivity, especially in the urban cores of New York, San Francisco and Boston.  Looking forward, we believe the rate of improvement in our business will be dictated by how effectively the virus can be controlled and more normal economic activity restored.  In the meantime, our strong balance sheet, state of the art operating platform and opportunistic mindset leaves us well positioned to weather the storm and to take advantage should conditions allow.”

Highlights

● The Company experienced a recovery in demand by late May 2020.  Initial leads, Traffic and applications continue to be in-line with the same time last year;

● During the second quarter of 2020, the Company collected on average 97% of its total monthly Residential rental income.  July 2020 collections continue to trend on a similar pace to prior months;

● Strong expense control, along with continued enhancements in our operating platform, led to a decline in same store expenses for the second quarter;

● Resident retention was the highest for the second quarter in the Company’s history;

● The Company sold two properties, totaling 655 apartment units, during the second quarter of 2020 for an aggregate sales price of approximately $384.2 million; and

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● The Company successfully implemented changes to its leasing and service operations as well as the physical layout of its properties as part of its commitment to health and safety. The Company remains focused on further enhancing its existing health and safety standards during the pandemic.

COVID-19

The Company continues to support its residents and employees during the COVID-19 pandemic. The Company is utilizing technology to allow our property teams to interact remotely with current and prospective residents, including a touchless new leasing process and a service process designed to limit contact. We also continue to provide additional paid leave for employees impacted by the pandemic and paid special bonuses to certain on-site employees during the second quarter of 2020 in recognition of their significant efforts.  Among other resident support efforts, we have an extensive outreach process for residents financially impacted by the pandemic and have created payment plans to assist them.

Results Per Share

The change in EPS for the quarter ended June 30, 2020 compared to the same period of 2019 is due primarily to lower property sale gains in the second quarter of 2020, the various adjustment items listed on page 25 of this release and the items described below.  The change in EPS for the six months ended June 30, 2020 compared to the same period of 2019 is due primarily to higher property sale gains in the first six months of 2020, the various adjustment items listed on page 25 of this release and the items described below.

The per share changes in FFO for both the quarter and six months ended June 30, 2020 compared to the same periods of 2019, are due primarily to the various adjustment items listed on page 25 of this release and the items described below.

The per share changes in Normalized FFO are due primarily to:

	Positive/(Negative) Impact
	Second Quarter 2020 vs. Second Quarter 2019			June YTD 2020 vs. June YTD 2019
Same Store Net Operating Income (NOI)	$	(0.04	)	$	(0.01	)
Lease-Up NOI		0.01			0.01
2020 and 2019 transaction activity impact on NOI, net		(0.01	)		(0.01	)
Interest expense		0.03			0.06
Other items		0.01			—
Net	$	—		$	0.05

The Company has a glossary of defined terms and related reconciliations of Non-GAAP financial measures on pages 26 through 31 of this release. Reconciliations and definitions of FFO and Normalized FFO are provided on pages 6, 28 and 29 of this release.

Same Store Results

The Company has provided a breakout of Residential and Non-Residential same store results on pages 10 and 11 of this release with definitions that can be found on page 30 of this release.  Non-Residential operations historically have accounted for approximately 4.0% of total revenues.  The table below reflects same store Residential only results for the second quarter 2020 to second quarter 2019 comparison, which includes 74,843 apartment units, as well as for the six months ended June 30, 2020 to six months ended June 30, 2019 comparison, which includes 74,264 apartment units. The Company’s Physical Occupancy was 94.9% compared to 96.5% for the second quarter of 2020 and 2019, respectively, and 95.7% compared to 96.4% for the first six months of 2020 and 2019, respectively.  

	Second Quarter 2020 vs. Second Quarter 2019	June YTD 2020 vs. June YTD 2019
Revenues	(0.9%)	1.0%
Expenses	(0.1%)	1.1%
NOI	(1.2%)	0.9%

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Preliminary July 2020 Residential Same Store Operating Statistics

The following table includes select statistics for the month of July 2020 as well as the second quarter of 2020.

	July 2020	Second Quarter 2020
New Lease Change	(8.3%)	(7.0%)
Renewal Rate Achieved	(0.9%)	0.7%
Blended Rate (1)	(4.5%)	(2.7%)
Physical Occupancy	95.0%	94.9%

(1) Blended Rate after applying the effect of new move-in and renewal concessions is approximately (5.5%) and (3.5%) for July 2020 and the second quarter of 2020, respectively, driven by higher usage in the urban cores of New York, San Francisco and Boston.

The July 2020 results listed above are approximately equal to the Company's June 2020 results for New Lease Change, Renewal Rate Achieved and Blended Rate.  Concession use is higher in July 2020 than in June 2020.

Investment Activity

The Company sold two apartment properties, consisting of 655 apartment units, during the second quarter of 2020 for an aggregate sales price of approximately $384.2 million at a weighted average Disposition Yield of 4.4%, generating an Unlevered IRR of 8.4%. The properties are located in the San Francisco Bay area and the Washington, D.C. area and were placed under contract prior to March 1, 2020.  During the first six months of 2020, the Company sold five properties, consisting of 1,552 apartment units, for an aggregate sales price of approximately $754.4 million at a weighted average Disposition Yield of 4.7%, generating an Unlevered IRR of 10.8%.  The Company did not acquire any apartment properties during the first six months of 2020.

Capital Markets Activity

On April 30, 2020, the Company closed on a $495.0 million secured loan.  The loan has a ten-year term, is interest only, and carries a fixed interest rate of 2.60%.  Proceeds from the loan were used to pay off outstanding balances under the Company’s revolving line of credit and commercial paper program. As of July 28, 2020, the Company had no outstanding balances under its revolving credit facility or commercial paper program and approximately $2.4 billion in available liquidity.

Third Quarter 2020 Earnings and Conference Call

Equity Residential expects to announce its third quarter 2020 results on Tuesday, October 27, 2020 and host a conference call to discuss those results at 10:00 a.m. CT on Wednesday, October 28, 2020.

About Equity Residential

Equity Residential is committed to creating communities where people thrive.  The Company, a member of the S&P 500, is focused on the acquisition, development and management of rental apartment properties located in urban and high-density suburban communities where today’s renters want to live, work and play.  Equity Residential owns or has investments in 304 properties consisting of 78,410 apartment units, located in Boston, New York, Washington, D.C., Seattle, San Francisco, Southern California and Denver.  For more information on Equity Residential, please visit our website atwww.equityapartments.com.

Forward-Looking Statements

In addition to historical information, this press release contains forward-looking statements and information within the meaning of the federal securities laws.  These statements are based on current expectations, estimates, projections and assumptions made by management.  While Equity Residential’s management believes the assumptions underlying its forward-looking statements are reasonable, such information is inherently subject to uncertainties and may involve certain risks, including, without limitation, changes in general market conditions, including the rate of job growth and cost of labor and construction material, the level of new multifamily construction and development, competition and local government regulation.  In addition, these forward-looking statements are subject to risks related to the COVID-19 pandemic, many of which are unknown, including the duration and severity of the pandemic, the extent of the adverse health impact on the general population and on our residents, customers and employees in particular, its impact on the employment rate and the economy and the corresponding impact on our residents’ and tenants’ ability to pay their rent on time or at all, the extent and impact of governmental responses and the impact of operational changes we have implemented and may implement in response to the pandemic. Other risks and uncertainties are described under the heading “Risk Factors” in our Annual Report on Form 10-K and subsequent periodic reports filed with the Securities and Exchange Commission (SEC) and available on our website,www.equityapartments.com. Many of these uncertainties and risks are difficult to predict and beyond management’s control.  Forward-looking statements are not guarantees of future performance, results

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or events.  Equity Residential assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

A live web cast of the Company’s conference call discussing these results will take place tomorrow, Wednesday, July 29, 2020 at 10:00 a.m. CT.  Please visit the Investor section of the Company’s web site at www.equityapartments.com for the link.  A replay of the web cast will be available for two weeks at this site.

4

Equity Residential

Consolidated Statements of Operations

(Amounts in thousands except per share data)

(Unaudited)

	Six Months Ended June 30,						Quarter Ended June 30,
	2020			2019			2020			2019
REVENUES
Rental income	$	1,335,837		$	1,331,676		$	653,532		$	669,374
EXPENSES
Property and maintenance		220,268			223,531			104,452			108,461
Real estate taxes and insurance		192,770			182,888			95,038			91,446
Property management		51,317			50,765			23,608			24,369
General and administrative		26,353			29,710			11,835			14,329
Depreciation		418,398			404,723			205,976			200,508
Total expenses		909,106			891,617			440,909			439,113
Net gain (loss) on sales of real estate properties		352,243			138,835			144,266			138,856
Operating income		778,974			578,894			356,889			369,117
Interest and other income		3,471			1,925			1,511			1,152
Other expenses		(4,227	)		(8,392	)		(1,694	)		(5,117	)
Interest:
Expense incurred, net		(167,475	)		(203,840	)		(81,885	)		(108,902	)
Amortization of deferred financing costs		(4,152	)		(5,783	)		(2,111	)		(3,647	)
Income before income and other taxes, income (loss) from    investments in unconsolidated entities and net gain (loss)    on sales of land parcels		606,591			362,804			272,710			252,603
Income and other tax (expense) benefit		(240	)		(484	)		(187	)		(246	)
Income (loss) from investments in unconsolidated entities		(2,199	)		68,058			(1,042	)		68,765
Net gain (loss) on sales of land parcels		—			178			—			177
Net income		604,152			430,556			271,481			321,299
Net (income) loss attributable to Noncontrolling Interests:
Operating Partnership		(21,248	)		(15,429	)		(9,713	)		(11,510	)
Partially Owned Properties		(13,410	)		(1,620	)		(880	)		(821	)
Net income attributable to controlling interests		569,494			413,507			260,888			308,968
Preferred distributions		(1,545	)		(1,545	)		(772	)		(772	)
Net income available to Common Shares	$	567,949		$	411,962		$	260,116		$	308,196
Earnings per share – basic:
Net income available to Common Shares	$	1.53		$	1.11		$	0.70		$	0.83
Weighted average Common Shares outstanding		371,689			369,952			371,795			370,342
Earnings per share – diluted:
Net income available to Common Shares	$	1.53		$	1.11		$	0.70		$	0.83
Weighted average Common Shares outstanding		386,272			385,644			385,913			386,107
Distributions declared per Common Share outstanding	$	1.205		$	1.135		$	0.6025		$	0.5675

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Equity Residential

Consolidated Statements of Funds From Operations and Normalized Funds From Operations

(Amounts in thousands except per share data)

(Unaudited)

	Six Months Ended June 30,						Quarter Ended June 30,
	2020			2019			2020			2019
Net income	$	604,152		$	430,556		$	271,481		$	321,299
Net (income) loss attributable to Noncontrolling Interests – Partially    Owned Properties		(13,410	)		(1,620	)		(880	)		(821	)
Preferred distributions		(1,545	)		(1,545	)		(772	)		(772	)
Net income available to Common Shares and Units		589,197			427,391			269,829			319,706
Adjustments:
Depreciation		418,398			404,723			205,976			200,508
Depreciation – Non-real estate additions		(2,307	)		(2,303	)		(1,020	)		(1,121	)
Depreciation – Partially Owned Properties		(1,686	)		(1,802	)		(830	)		(899	)
Depreciation – Unconsolidated Properties		1,224			1,772			611			850
Net (gain) loss on sales of unconsolidated entities - operating    assets		—			(69,522	)		—			(69,522	)
Net (gain) loss on sales of real estate properties		(352,243	)		(138,835	)		(144,266	)		(138,856	)
Noncontrolling Interests share of gain (loss) on sales    of real estate properties		11,655			—			—			—
FFO available to Common Shares and Units		664,238			621,424			330,300			310,666
Adjustments (see note for additional detail):
Impairment – non-operating assets		—			—			—			—
Write-off of pursuit costs		3,278			2,987			1,651			1,539
Debt extinguishment and preferred share redemption (gains)    losses		32			16,647			32			16,647
Non-operating asset (gains) losses		670			252			229			23
Other miscellaneous items		(2,310	)		4,418			(1,392	)		2,843
Normalized FFO available to Common Shares and Units	$	665,908		$	645,728		$	330,820		$	331,718
FFO	$	665,783		$	622,969		$	331,072		$	311,438
Preferred distributions		(1,545	)		(1,545	)		(772	)		(772	)
FFO available to Common Shares and Units	$	664,238		$	621,424		$	330,300		$	310,666
FFO per share and Unit – basic	$	1.73		$	1.62		$	0.86		$	0.81
FFO per share and Unit – diluted	$	1.72		$	1.61		$	0.86		$	0.80
Normalized FFO	$	667,453		$	647,273		$	331,592		$	332,490
Preferred distributions		(1,545	)		(1,545	)		(772	)		(772	)
Normalized FFO available to Common Shares and Units	$	665,908		$	645,728		$	330,820		$	331,718
Normalized FFO per share and Unit – basic	$	1.73		$	1.69		$	0.86		$	0.87
Normalized FFO per share and Unit – diluted	$	1.72		$	1.67		$	0.86		$	0.86
Weighted average Common Shares and Units outstanding – basic		384,702			382,854			384,818			383,227
Weighted average Common Shares and Units outstanding – diluted		386,272			385,644			385,913			386,107

Note: See Adjustments from FFO to Normalized FFO for additional detail regarding the adjustments from FFO to Normalized FFO. See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for the definitions of non-GAAP financial measures and other terms as well as the reconciliations of EPS to FFO per share and Normalized FFO per share.

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Equity Residential

Consolidated Balance Sheets

(Amounts in thousands except for share amounts)

(Unaudited)

	June 30,			December 31,
	2020			2019
ASSETS
Land	$	5,789,307		$	5,936,188
Depreciable property		20,997,903			21,319,101
Projects under development		274,825			181,630
Land held for development		102,361			96,688
Investment in real estate		27,164,396			27,533,607
Accumulated depreciation		(7,537,713	)		(7,276,786	)
Investment in real estate, net		19,626,683			20,256,821
Investments in unconsolidated entities		55,310			52,238
Cash and cash equivalents		187,416			45,753
Restricted deposits		58,117			71,246
Right-of-use assets		505,077			512,774
Other assets		282,348			233,937
Total assets	$	20,714,951		$	21,172,769
LIABILITIES AND EQUITY
Liabilities:
Mortgage notes payable, net	$	2,340,757		$	1,941,610
Notes, net		6,081,102			6,077,513
Line of credit and commercial paper		—			1,017,833
Accounts payable and accrued expenses		109,776			94,350
Accrued interest payable		67,589			66,852
Lease liabilities		330,135			331,334
Other liabilities		315,208			346,963
Security deposits		64,005			70,062
Distributions payable		232,208			218,326
Total liabilities		9,540,780			10,164,843
Commitments and contingencies
Redeemable Noncontrolling Interests – Operating Partnership		336,695			463,400
Equity:
Shareholders’ equity:
Preferred Shares of beneficial interest, $0.01 par value;    100,000,000 shares authorized; 745,600 shares issued and    outstanding as of June 30, 2020 and December 31, 2019		37,280			37,280
Common Shares of beneficial interest, $0.01 par value;    1,000,000,000 shares authorized; 372,209,012 shares issued    and outstanding as of June 30, 2020 and 371,670,884    shares issued and outstanding as of December 31, 2019		3,722			3,717
Paid in capital		9,118,332			8,965,577
Retained earnings		1,505,694			1,386,495
Accumulated other comprehensive income (loss)		(67,355	)		(77,563	)
Total shareholders’ equity		10,597,673			10,315,506
Noncontrolling Interests:
Operating Partnership		235,169			227,837
Partially Owned Properties		4,634			1,183
Total Noncontrolling Interests		239,803			229,020
Total equity		10,837,476			10,544,526
Total liabilities and equity	$	20,714,951		$	21,172,769

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Equity Residential

Portfolio Summary

As of June 30, 2020

					% of Stabilized			Average
			Apartment		Budgeted			Rental
Markets/Metro Areas	Properties		Units		NOI			Rate
Los Angeles		72		16,603		19.1	%	$	2,590
Orange County		13		4,028		4.4	%		2,263
San Diego		12		3,385		3.8	%		2,426
Subtotal – Southern California		97		24,016		27.3	%		2,511
San Francisco		48		12,707		19.8	%		3,320
Washington DC		47		14,731		15.8	%		2,458
New York		37		9,606		14.6	%		3,909
Seattle		45		9,296		10.9	%		2,466
Boston		25		6,430		10.1	%		3,173
Denver		5		1,624		1.5	%		2,048
Total		304		78,410		100.0	%	$	2,841

	Properties		Apartment Units
Wholly Owned Properties		287		74,849
Master-Leased Properties – Consolidated		1		162
Partially Owned Properties – Consolidated		16		3,399
		304		78,410

Note:  Projects under development are not included in the Portfolio Summary until construction has been completed.

2nd Quarter 2020 Earnings Release 8

Equity Residential

Portfolio Rollforward Q2 2020

($ in thousands)

		Properties			Apartment Units			Sales Price			Disposition Yield
	3/31/2020		306			79,065
Dispositions:
Consolidated Rental Properties			(2	)		(655	)	$	(384,161	)		(4.4	%)
	6/30/2020		304			78,410

Portfolio Rollforward 2020

($ in thousands)

		Properties			Apartment Units			Sales Price			Disposition Yield
	12/31/2019		309			79,962
Dispositions:
Consolidated Rental Properties			(5	)		(1,552	)	$	(754,361	)		(4.7	%)
	6/30/2020		304			78,410

2nd Quarter 2020 Earnings Release 9

Equity Residential

Second Quarter 2020 vs. Second Quarter 2019

Same Store Results/Statistics Including 74,843 Same Store Apartment Units

$ in thousands (except for Average Rental Rate)

Second Quarter 2020												Second Quarter 2019
	Residential			% Change	Non- Residential			% Change	Total		% Change		Residential			Non- Residential		Total
Revenues	$	608,739		(0.9%)	$	14,536	(1)	(39.1%)	$	623,275	(2.3%)	Revenues	$	614,049		$	23,866	$	637,915
Expenses	$	184,824		(0.1%)	$	5,197		(1.0%)	$	190,021	(0.1%)	Expenses	$	185,025		$	5,252	$	190,277
NOI	$	423,915		(1.2%)	$	9,339		(49.8%)	$	433,254	(3.2%)	NOI	$	429,024		$	18,614	$	447,638
Average Rental Rate	$	2,860		0.8%								Average Rental Rate	$	2,836
Physical Occupancy		94.9	%	(1.6%)								Physical Occupancy		96.5	%
Turnover		11.8	%	(1.3%)								Turnover		13.1	%

Second Quarter 2020 vs. First Quarter 2020

Same Store Results/Statistics Including 77,809 Same Store Apartment Units

$ in thousands (except for Average Rental Rate)

Second Quarter 2020												First Quarter 2020
	Residential			% Change	Non- Residential			% Change	Total		% Change		Residential			Non- Residential		Total
Revenues	$	629,340		(2.4%)	$	14,766	(1)	(37.1%)	$	644,106	(3.6%)	Revenues	$	644,487		$	23,487	$	667,974
Expenses	$	191,372		(4.5%)	$	5,271		(11.1%)	$	196,643	(4.7%)	Expenses	$	200,347		$	5,932	$	206,279
NOI	$	437,968		(1.4%)	$	9,495		(45.9%)	$	447,463	(3.1%)	NOI	$	444,140		$	17,555	$	461,695
Average Rental Rate	$	2,845		(0.7%)								Average Rental Rate	$	2,866
Physical Occupancy		94.8	%	(1.6%)								Physical Occupancy		96.4	%
Turnover		11.9	%	2.1%								Turnover		9.8	%

(1) Non-Residential operations have been more significantly impacted by the COVID-19 pandemic than the Company’s core Residential business.  The decline in Non-Residential revenues is primarily driven by lower public parking income, deferral/abatement of rent and higher bad debt expense.

Note:  See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for reconciliations from operating income.

2nd Quarter 2020 Earnings Release 10

Equity Residential

June YTD 2020 vs. June YTD 2019

Same Store Results/Statistics Including 74,264 Same Store Apartment Units

$ in thousands (except for Average Rental Rate)

June YTD 2020												June YTD 2019
	Residential			% Change	Non- Residential			% Change	Total		% Change		Residential			Non- Residential		Total
Revenues	$	1,223,361		1.0%	$	37,464	(1)	(20.4%)	$	1,260,825	0.2%	Revenues	$	1,211,210		$	47,051	$	1,258,261
Expenses	$	375,710		1.1%	$	11,032		3.4%	$	386,742	1.2%	Expenses	$	371,517		$	10,671	$	382,188
NOI	$	847,651		0.9%	$	26,432		(27.3%)	$	874,083	(0.2%)	NOI	$	839,693		$	36,380	$	876,073
Average Rental Rate	$	2,871		1.8%								Average Rental Rate	$	2,821
Physical Occupancy		95.7	%	(0.7%)								Physical Occupancy		96.4	%
Turnover		21.4	%	(1.9%)								Turnover		23.3	%

(1) Non-Residential operations have been more significantly impacted by the COVID-19 pandemic than the Company’s core Residential business.  The decline in Non-Residential revenues is primarily driven by lower public parking income, deferral/abatement of rent and higher bad debt expense.  

Note:  See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for reconciliations from operating income.

Same Store Resident/Tenant Accounts Receivable Balances

Including 74,264 Same Store Apartment Units

$ in thousands

	Residential							Non-Residential
	June 30, 2020				March 31, 2020			June 30, 2020			March 31, 2020
Resident/tenant accounts receivable balances	$	18,175			$	5,358		$	4,815		$	2,270
Allowance for doubtful accounts		(6,518	)			(1,850	)		(2,416	)		(1,532	)
Net receivable balances	$	11,657		(2)	$	3,508		$	2,399		$	738
Straight-line receivable balances	$	2,990			$	1,633		$	24,161		$	26,154

(2) The Company held Residential security deposits approximating 20% of the net receivable balance at June 30, 2020.

Note: See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for other definitions.

2nd Quarter 2020 Earnings Release 11

Equity Residential

Second Quarter 2020 vs. Second Quarter 2019

Same Store Residential Results/Statistics by Market

														Increase (Decrease) from Prior Year's Quarter
Markets/Metro Areas	Apartment Units		Q2 2020 % of Actual NOI			Q2 2020 Average Rental Rate		Q2 2020 Weighted Average Physical Occupancy %			Q2 2020 Turnover			Revenues			Expenses			NOI			Average Rental Rate			Physical Occupancy			Turnover
Los Angeles		15,968		19.5	%	$	2,596		94.7	%		11.9	%		(1.9	%)		(1.7	%)		(1.9	%)		(0.2	%)		(1.6	%)		(2.2	%)
Orange County		4,028		4.8	%		2,263		96.3	%		9.8	%		1.0	%		(0.2	%)		1.4	%		1.2	%		(0.1	%)		(3.9	%)
San Diego		3,385		4.2	%		2,426		96.0	%		11.8	%		0.4	%		1.8	%		(0.1	%)		1.2	%		(0.7	%)		(2.5	%)
Subtotal – Southern California		23,381		28.5	%		2,513		95.1	%		11.5	%		(1.1	%)		(1.1	%)		(1.1	%)		0.1	%		(1.3	%)		(2.6	%)
San Francisco		12,183		20.4	%		3,324		94.9	%		11.6	%		(0.8	%)		2.0	%		(1.7	%)		0.5	%		(1.2	%)		(1.7	%)
Washington DC		13,711		16.1	%		2,465		95.4	%		11.3	%		0.1	%		(2.4	%)		1.1	%		1.5	%		(1.4	%)		(0.9	%)
New York		9,606		14.1	%		3,909		94.1	%		11.5	%		(2.7	%)		1.0	%		(5.4	%)		0.4	%		(3.0	%)		1.2	%
Seattle		8,616		10.2	%		2,469		95.4	%		11.6	%		2.2	%		3.1	%		1.8	%		3.4	%		(1.2	%)		(3.5	%)
Boston		6,346		9.6	%		3,174		93.5	%		13.7	%		(1.2	%)		(2.8	%)		(0.6	%)		1.9	%		(2.9	%)		1.3	%
Denver		1,000		1.1	%		2,173		93.2	%		17.1	%		(3.7	%)		(5.6	%)		(2.9	%)		(1.2	%)		(2.4	%)		0.9	%
Total		74,843		100.0	%	$	2,860		94.9	%		11.8	%		(0.9	%)		(0.1	%)		(1.2	%)		0.8	%		(1.6	%)		(1.3	%)

Note: The above table reflects Residential same store results only, which historically account for approximately 96.0% of total revenues.

2nd Quarter 2020 Earnings Release 12

Equity Residential

Second Quarter 2020 vs. First Quarter 2020

Same Store Residential Results/Statistics by Market

														Increase (Decrease) from Prior Quarter
Markets/Metro Areas	Apartment Units		Q2 2020 % of Actual NOI			Q2 2020 Average Rental Rate		Q2 2020 Weighted Average Physical Occupancy %			Q2 2020 Turnover			Revenues			Expenses			NOI			Average Rental Rate			Physical Occupancy			Turnover
Los Angeles		16,603		19.5	%	$	2,590		94.6	%		12.1	%		(3.1	%)		(5.1	%)		(2.3	%)		(1.7	%)		(1.3	%)		0.8	%
Orange County		4,028		4.7	%		2,263		96.3	%		9.8	%		(1.4	%)		(4.2	%)		(0.5	%)		(0.8	%)		(0.5	%)		0.8	%
San Diego		3,385		4.0	%		2,426		96.0	%		11.8	%		(1.4	%)		(3.3	%)		(0.8	%)		(0.7	%)		(0.8	%)		(0.2	%)
Subtotal – Southern California		24,016		28.2	%		2,511		95.1	%		11.6	%		(2.6	%)		(4.8	%)		(1.8	%)		(1.5	%)		(1.1	%)		0.6	%
San Francisco		12,707		20.5	%		3,320		94.8	%		11.7	%		(2.5	%)		(3.5	%)		(2.2	%)		(0.6	%)		(1.9	%)		2.0	%
Washington DC		14,569		16.5	%		2,458		95.4	%		11.3	%		(0.6	%)		(6.0	%)		1.8	%		0.3	%		(0.8	%)		2.7	%
New York		9,606		13.6	%		3,909		94.1	%		11.5	%		(3.5	%)		(6.2	%)		(1.3	%)		(0.9	%)		(2.6	%)		4.3	%
Seattle		8,941		10.3	%		2,480		95.3	%		11.7	%		(1.9	%)		3.4	%		(3.8	%)		(0.1	%)		(1.8	%)		0.6	%
Boston		6,346		9.3	%		3,174		93.5	%		13.7	%		(2.7	%)		(5.7	%)		(1.4	%)		(0.2	%)		(2.3	%)		4.6	%
Denver		1,624		1.6	%		2,048		94.1	%		17.1	%		(1.8	%)		(5.6	%)		(0.3	%)		(0.3	%)		(1.4	%)		2.7	%
Total		77,809		100.0	%	$	2,845		94.8	%		11.9	%		(2.4	%)		(4.5	%)		(1.4	%)		(0.7	%)		(1.6	%)		2.1	%

Note: The above table reflects Residential same store results only, which historically account for approximately 96.0% of total revenues.

2nd Quarter 2020 Earnings Release 13

Equity Residential

June YTD 2020 vs. June YTD 2019

Same Store Residential Results/Statistics by Market

														Increase (Decrease) from Prior Year
Markets/Metro Areas	Apartment Units		June YTD 20 % of Actual NOI			June YTD 20 Average Rental Rate		June YTD 20 Weighted Average Physical Occupancy %			June YTD 20 Turnover			Revenues			Expenses			NOI			Average Rental Rate			Physical Occupancy			Turnover
Los Angeles		15,968		19.7	%	$	2,615		95.3	%		23.2	%		0.1	%		(0.3	%)		0.2	%		1.0	%		(0.9	%)		(2.6	%)
Orange County		4,028		4.8	%		2,272		96.6	%		18.8	%		2.2	%		0.2	%		2.8	%		2.0	%		0.2	%		(5.4	%)
San Diego		3,385		4.2	%		2,435		96.4	%		23.7	%		1.9	%		2.1	%		1.9	%		2.0	%		0.0	%		(2.7	%)
Subtotal – Southern California		23,381		28.7	%		2,529		95.7	%		22.5	%		0.7	%		0.1	%		0.9	%		1.3	%		(0.6	%)		(3.1	%)
San Francisco		12,183		20.7	%		3,334		95.8	%		21.1	%		1.1	%		2.9	%		0.5	%		1.7	%		(0.6	%)		(1.9	%)
Washington DC		13,711		16.0	%		2,463		95.9	%		19.8	%		1.3	%		(0.1	%)		1.9	%		2.1	%		(0.7	%)		(0.8	%)
New York		9,475		14.0	%		3,930		95.4	%		18.7	%		(0.3	%)		2.4	%		(2.4	%)		1.1	%		(1.3	%)		0.4	%
Seattle		8,442		10.2	%		2,469		96.3	%		22.9	%		3.8	%		2.7	%		4.2	%		3.9	%		(0.1	%)		(5.1	%)
Boston		6,346		9.7	%		3,178		94.7	%		22.7	%		1.0	%		(1.9	%)		2.2	%		2.6	%		(1.4	%)		1.2	%
Denver		726		0.7	%		2,133		94.5	%		30.6	%		(1.2	%)		(0.3	%)		(1.5	%)		0.6	%		(1.9	%)		0.0	%
Total		74,264		100.0	%	$	2,871		95.7	%		21.4	%		1.0	%		1.1	%		0.9	%		1.8	%		(0.7	%)		(1.9	%)

Note: The above table reflects Residential same store results only, which historically account for approximately 96.0% of total revenues.

2nd Quarter 2020 Earnings Release 14

Equity Residential

Same Store Residential Lease Pricing Statistics

For 74,264 Same Store Apartment Units

	New Lease Change (1)						Renewal Rate Achieved (1)						Blended Rate (1)
Markets/Metro Areas	Q2 2020			Q2 2019			Q2 2020			Q2 2019			Q2 2020				Q2 2019
Los Angeles		(6.7	%)		0.4	%		0.4	%		5.2	%		(3.0	%)			2.7	%
Orange County		(5.1	%)		1.8	%		0.9	%		6.0	%		(1.5	%)			4.0	%
San Diego		(3.5	%)		3.4	%		0.1	%		6.0	%		(1.5	%)			4.6	%
Subtotal – Southern California		(6.0	%)		1.1	%		0.5	%		5.4	%		(2.6	%)			3.1	%
San Francisco		(9.6	%)		4.5	%		(0.5	%)		5.6	%		(4.6	%)			5.1	%
Washington DC		(5.3	%)		2.5	%		1.2	%		4.5	%		(1.6	%)			3.5	%
New York		(8.0	%)		0.7	%		1.2	%		4.0	%		(2.0	%)			2.7	%
Seattle		(3.4	%)		2.9	%		0.7	%		5.6	%		(0.8	%)			4.3	%
Boston		(9.6	%)		3.1	%		1.4	%		5.3	%		(3.9	%)			4.2	%
Denver		(2.8	%)		2.5	%		1.1	%		4.4	%		(1.3	%)			3.2	%
Total		(7.0	%)		2.3	%		0.7	%		5.0	%		(2.7	%)	(2)		3.7	%

(1) See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for definitions.

(2) Blended Rate after applying the effect of new move-in and renewal concessions is approximately (3.5%) for Q2 2020, driven by higher usage in the urban cores of New York, San Francisco and Boston.  The effect of new move-in and renewal concessions in Q2 2019 was immaterial.

2nd Quarter 2020 Earnings Release 15

Equity Residential

Second Quarter 2020 vs. Second Quarter 2019

Total Same Store Operating Expenses Including 74,843 Same Store Apartment Units

$ in thousands

	Actual Q2 2020		Actual Q2 2019		$ Change (1)			% Change			% of Actual Q2 2020 Operating Expenses
Real estate taxes	$	85,433	$	82,534	$	2,899			3.5	%		45.0	%
On-site payroll		39,861		40,827		(966	)		(2.4	%)		21.0	%
Utilities		24,018		23,756		262			1.1	%		12.6	%
Repairs and maintenance		21,977		24,799		(2,822	)		(11.4	%)		11.6	%
Insurance		6,125		5,209		916			17.6	%		3.2	%
Leasing and advertising		2,150		2,473		(323	)		(13.1	%)		1.1	%
Other on-site operating expenses		10,457		10,679		(222	)		(2.1	%)		5.5	%
Total Same Store Operating Expenses (2) (includes Residential and Non-Residential)	$	190,021	$	190,277	$	(256	)		(0.1	%)		100.0	%

June YTD 2020 vs. June YTD 2019

Total Same Store Operating Expenses Including 74,264 Same Store Apartment Units

$ in thousands

	Actual YTD 2020		Actual YTD 2019		$ Change (1)			% Change			% of Actual YTD 2020 Operating Expenses
Real estate taxes	$	170,416	$	164,075	$	6,341			3.9	%		44.1	%
On-site payroll		81,249		81,757		(508	)		(0.6	%)		21.0	%
Utilities		50,654		49,787		867			1.7	%		13.1	%
Repairs and maintenance		44,497		48,027		(3,530	)		(7.4	%)		11.5	%
Insurance		12,187		10,365		1,822			17.6	%		3.2	%
Leasing and advertising		4,385		4,917		(532	)		(10.8	%)		1.1	%
Other on-site operating expenses		23,354		23,260		94			0.4	%		6.0	%
				—
Total Same Store Operating Expenses (2) (includes Residential and Non-Residential)	$	386,742	$	382,188	$	4,554			1.2	%		100.0	%

(1) The quarter over quarter and YTD over YTD changes are due primarily to:

Real estate taxes – Higher rates and assessed values continue to drive real estate tax growth across most markets with a slight improvement from previous expectations caused by successful appeals activity and lower than expected rate growth in New York.

On-site payroll – Results better than expectations due to faster than anticipated progress in transition to enhanced operating platform, lower than expected employee benefit-related costs and less overtime, partially offset by one-time frontline worker bonuses.

Utilities – Growth lower than expected due to warmer winter weather and energy rate decreases.

Repairs and maintenance – Decrease primarily driven by deferral and cancellation of some projects as a result of COVID-19-related delays.

Insurance – Increase due to higher premiums on property insurance renewal caused by challenging conditions in the insurance market.

Leasing and advertising – Decrease greater than expectations due in part to suspension of resident activities.

(2) See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for additional details.

2nd Quarter 2020 Earnings Release 16

Equity Residential

Debt Summary as of June 30, 2020

($ in thousands)

	Debt Balances (1)		% of Total			Weighted Average Rates (1)			Weighted Average Maturities (years)
Secured	$	2,340,757		27.8	%		3.51	%		7.0
Unsecured		6,081,102		72.2	%		3.85	%		10.3
Total	$	8,421,859		100.0	%		3.77	%		9.4
Fixed Rate Debt:
Secured – Conventional	$	1,972,862		23.4	%		3.94	%		5.4
Unsecured – Public		6,081,102		72.2	%		4.06	%		10.3
Fixed Rate Debt		8,053,964		95.6	%		4.03	%		9.1
Floating Rate Debt:
Secured – Conventional		7,315		0.1	%		3.35	%		2.0
Secured – Tax Exempt		360,580		4.3	%		1.49	%		15.5
Unsecured – Revolving Credit Facility		—		—			1.47	%		4.3
Unsecured – Commercial Paper Program (2)		—		—			1.81	%		—
Floating Rate Debt		367,895		4.4	%		1.68	%		15.2
Total	$	8,421,859		100.0	%		3.77	%		9.4

(1) See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for additional details.

(2) The weighted average amount outstanding for the six months ended June 30, 2020 was approximately $522.7 million.

Note: The Company capitalized interest of approximately $4.1 million and $2.7 million during the six months ended June 30, 2020 and 2019, respectively.  The Company capitalized interest of approximately $2.3 million and $1.5 million during the quarters ended June 30, 2020 and 2019, respectively.

2nd Quarter 2020 Earnings Release 17

Equity Residential

Debt Maturity Schedule as of June 30, 2020

($ in thousands)

Year	Fixed Rate			Floating Rate			Total			% of Total			Weighted Average Coupons on Fixed Rate Debt (1)			Weighted Average Coupons on Total Debt (1)
2020	$	23,669		$	—		$	23,669			0.3	%		4.75	%		4.75	%
2021		834,904			—			834,904			9.8	%		4.63	%		4.63	%
2022		264,185			7,796			271,981			3.2	%		3.25	%		3.22	%
2023		1,325,588			3,500			1,329,088			15.6	%		3.74	%		3.73	%
2024		—			6,100			6,100			0.1	%	N/A				0.15	%
2025		450,000			8,200			458,200			5.4	%		3.38	%		3.32	%
2026		592,025			9,000			601,025			7.0	%		3.58	%		3.53	%
2027		400,000			9,800			409,800			4.8	%		3.25	%		3.18	%
2028		900,000			42,380			942,380			11.1	%		3.79	%		3.62	%
2029		888,120			11,500			899,620			10.6	%		3.30	%		3.26	%
2030+		2,445,850			288,135			2,733,985			32.1	%		3.56	%		3.21	%
Subtotal		8,124,341			386,411			8,510,752			100.0	%		3.67	%		3.51	%
Deferred Financing Costs and Unamortized (Discount)		(70,377	)		(18,516	)		(88,893	)	N/A			N/A			N/A
Total	$	8,053,964		$	367,895		$	8,421,859			100.0	%		3.67	%		3.51	%

(1) See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for additional details.

2nd Quarter 2020 Earnings Release 18

Equity Residential

Selected Unsecured Public Debt Covenants

	June 30,		March 31,
	2020		2020
Debt to Adjusted Total Assets (not to exceed 60%)	31.8%		32.5%
Secured Debt to Adjusted Total Assets (not to exceed 40%)	9.7%		8.2%
Consolidated Income Available for Debt Service to    Maximum Annual Service Charges    (must be at least 1.5 to 1)		4.96		5.09
Total Unencumbered Assets to Unsecured Debt    (must be at least 125%)	439.5%		408.3%

Note: These selected covenants represent the most restrictive financial covenants relating to ERP Operating Limited Partnership's ("ERPOP") outstanding public debt securities.  Equity Residential is the general partner of ERPOP.

Selected Credit Ratios

	June 30,	March 31,
	2020	2020
Total debt to Normalized EBITDAre	4.82x	4.91x
Net debt to Normalized EBITDAre	4.71x	4.86x
Unencumbered NOI as a % of total NOI	85.8%	87.2%

Note: See Normalized EBITDAre Reconciliations for detail.

2nd Quarter 2020 Earnings Release 19

Equity Residential

Capital Structure as of June 30, 2020

(Amounts in thousands except for share/unit and per share amounts)

Secured Debt					$	2,340,757	27.8	%
Unsecured Debt						6,081,102	72.2	%
Total Debt						8,421,859	100.0	%	27.0	%
Common Shares (includes Restricted Shares)		372,209,012	96.4	%
Units (includes OP Units and Restricted Units)		13,879,951	3.6	%
Total Shares and Units		386,088,963	100.0	%
Common Share Price at June 30, 2020	$	58.82
						22,709,753	99.8	%
Perpetual Preferred Equity (see below)						37,280	0.2	%
Total Equity						22,747,033	100.0	%	73.0	%
Total Market Capitalization					$	31,168,892			100.0	%

Perpetual Preferred Equity as of June 30, 2020

(Amounts in thousands except for share and per share amounts)

Series	Call Date	Outstanding Shares		Liquidation Value		Annual Dividend Per Share		Annual Dividend Amount
Preferred Shares:
8.29% Series K	12/10/26		745,600	$	37,280	$	4.145	$	3,091

2nd Quarter 2020 Earnings Release 20

Equity Residential

Common Share and Unit

Weighted Average Amounts Outstanding

	June YTD 2020		June YTD 2019		Q2 2020		Q2 2019
Weighted Average Amounts Outstanding for Net Income Purposes:
Common Shares - basic		371,688,567		369,952,087		371,795,049		370,342,189
Shares issuable from assumed conversion/vesting of:
- OP Units		13,013,343		12,902,350		13,022,786		12,885,175
- long-term compensation shares/units		1,570,149		2,789,234		1,095,436		2,879,255
Total Common Shares and Units - diluted		386,272,059		385,643,671		385,913,271		386,106,619
Weighted Average Amounts Outstanding for FFO and Normalized FFO Purposes:
Common Shares - basic		371,688,567		369,952,087		371,795,049		370,342,189
OP Units - basic		13,013,343		12,902,350		13,022,786		12,885,175
Total Common Shares and OP Units - basic		384,701,910		382,854,437		384,817,835		383,227,364
Shares issuable from assumed conversion/vesting of:
- long-term compensation shares/units		1,570,149		2,789,234		1,095,436		2,879,255
Total Common Shares and Units - diluted		386,272,059		385,643,671		385,913,271		386,106,619
Period Ending Amounts Outstanding:
Common Shares (includes Restricted Shares)		372,209,012		370,838,810
Units (includes OP Units and Restricted Units)		13,879,951		13,855,684
Total Shares and Units		386,088,963		384,694,494

2nd Quarter 2020 Earnings Release 21

Equity Residential

Development and Lease-Up Projects as of June 30, 2020

(Amounts in thousands except for project and apartment unit amounts)

		No. of		Total Budgeted		Total Book		Total Book Value Not						Estimated/Actual (A)
Projects	Location	Apartment Units		Capital Cost		Value to Date		Placed in Service		Total Debt		Percentage Completed		Initial Occupancy		Completion Date	Stabilization Date	Percentage Leased		Percentage Occupied
Projects Under Development - Wholly Owned:
Alcott Apartments (fka West End Tower) (B)	Boston, MA		470	$	409,749	$	190,391	$	190,391	$	—	46%		Q2 2021		Q3 2021	Q1 2023		—		—
The Edge (fka 4885 Edgemoor Lane) (C)	Bethesda, MD		154		75,271		25,306		25,306		—	28%		Q3 2021		Q3 2021	Q3 2022		—		—
Projects Under Development - Wholly Owned			624		485,020		215,697		215,697		—
Projects Under Development - Partially Owned:
Aero Apartments (D)	Alameda, CA		200		117,794		59,128		59,128		7,315	41%		Q4 2020		Q2 2021	Q2 2022		—		—
Projects Under Development - Partially Owned			200		117,794		59,128		59,128		7,315
Projects Under Development			824		602,814		274,825		274,825		7,315
Projects Completed and Stabilized During the Quarter - Wholly Owned:
Lofts at Kendall Square II (fka 249 Third Street)	Cambridge, MA		84		47,447		46,789		—		—			Q3 2019		Q3 2019	Q2 2020	93%		88%
Chloe on Madison (fka 1401 E. Madison)	Seattle, WA		137		64,791		64,097		—		—			Q3 2019		Q3 2019	Q2 2020	99%		99%
Projects Completed and Stabilized During the Quarter - Wholly Owned			221		112,238		110,886		—		—
Total Development Projects			1,045	$	715,052	$	385,711	$	274,825	$	7,315
Land Held for Development		N/A		N/A		$	102,361	$	102,361	$	—
NOI CONTRIBUTION FROM DEVELOPMENT PROJECTS												Total Budgeted Capital Cost		Q2 2020 NOI
Projects Under Development												$	602,814	$	—
Projects Completed and Stabilized During the Quarter													112,238		1,252
Total Development NOI Contribution												$	715,052	$	1,252

(A) Estimated dates and Total Budgeted Capital Costs for projects under development currently remain unchanged from the Company’s first quarter 2020 Earnings Release.  The Company will reevaluate these dates and costs as the impact from the COVID-19 pandemic becomes clearer.

(B) Alcott Apartments – Work at this project resumed on May 19, 2020 after a nine-week suspension due to the city of Boston’s COVID-19-related temporary construction moratorium.  

(C) The Edge – The land under this project is subject to a long-term ground lease.  This project is adjacent to an existing apartment property owned by the Company.

(D) Aero Apartments – This development project is owned 90% by the Company and 10% by a third party partner in a joint venture consolidated by the Company.  Construction is being partially funded with a construction loan that is non-recourse to the Company.  The joint venture partner has funded $4.6 million for its allocated share of the project equity and serves as the developer of the project.

2nd Quarter 2020 Earnings Release 22

Equity Residential

Capital Expenditures to Real Estate

For the Six Months Ended June 30, 2020

(Amounts in thousands except for apartment unit and per apartment unit amounts)

	Same Store Properties		Non-Same Store Properties/Other		Total		Same Store Avg. Per Apartment Unit
Total Apartment Units		74,264		4,146		78,410
Building Improvements	$	29,657	$	1,387	$	31,044	$	399
Renovation Expenditures (1)		15,022		6		15,028		202
Replacements		14,955		238		15,193		202
Capital Expenditures to Real Estate (2)	$	59,634	$	1,631	$	61,265	$	803

(1) Renovation Expenditures on 658 same store apartment units for the six months ended June 30, 2020 approximated $22,830 per apartment unit renovated.

(2) See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for additional details.

2nd Quarter 2020 Earnings Release 23

Equity Residential

Normalized EBITDAre Reconciliations

(Amounts in thousands)

	Trailing Twelve Months						2020						2019
	June 30, 2020			March 31, 2020			Q2			Q1			Q4			Q3			Q2
Net income	$	1,183,304		$	1,233,122		$	271,481		$	332,671		$	301,306		$	277,846		$	321,299
Interest expense incurred, net		353,711			380,728			81,885			85,590			100,300			85,936			108,902
Amortization of deferred financing costs		10,039			11,575			2,111			2,041			3,006			2,881			3,647
Amortization of above/below market lease intangibles		4,391			4,391			1,098			1,097			1,098			1,098			1,098
Depreciation		844,758			839,290			205,976			212,422			214,882			211,478			200,508
Income and other tax expense (benefit)		(2,525	)		(2,466	)		187			53			(3,030	)		265			246
EBITDA		2,393,678			2,466,640			562,738			633,874			617,562			579,504			635,700
Net (gain) loss on sales of real estate properties		(661,045	)		(655,635	)		(144,266	)		(207,977	)		(178,237	)		(130,565	)		(138,856	)
Net (gain) loss on sales of unconsolidated entities - operating assets		—			(69,522	)		—			—			—			—			(69,522	)
EBITDAre		1,732,633			1,741,483			418,472			425,897			439,325			448,939			427,322
Write-off of pursuit costs (other expenses)		5,820			5,708			1,651			1,627			1,431			1,111			1,539
(Income) loss from investments in unconsolidated entities - operations		4,312			4,027			1,042			1,157			961			1,152			757
Net (gain) loss on sales of land parcels		(1,866	)		(2,043	)		—			—			33			(1,899	)		(177	)
Insurance/litigation settlement or reserve income (interest and other income)		(2,350	)		(1,966	)		(767	)		(1,582	)		(1	)		—			(383	)
Insurance/litigation/environmental settlement or reserve expense (other expenses)		3,454			7,111			(1,956	)		163			5,229			18			1,701
Advocacy contributions (other expenses)		2,423			771			1,852			501			65			5			200
Data analytics project (other expenses)		1,416			2,824			—			—			—			1,416			1,408
Other		3			441			(521	)		—			(158	)		682			(83	)
Normalized EBITDAre	$	1,745,845		$	1,758,356		$	419,773		$	427,763		$	446,885		$	451,424		$	432,284
Balance Sheet Items:	June 30, 2020			March 31, 2020
Total debt	$	8,421,859		$	8,632,704
Cash and cash equivalents		(187,416	)		(82,335	)
Mortgage principal reserves/sinking funds		(11,895	)		(10,755	)
Net debt	$	8,222,548		$	8,539,614

Note: EBITDA, EBITDAre and Normalized EBITDAre do not include any adjustments for the Company’s share of partially owned unconsolidated entities or the minority partner’s share of partially owned consolidated entities due to the immaterial size of the Company’s partially owned portfolio.

2nd Quarter 2020 Earnings Release 24

430

Equity Residential

Adjustments from FFO to Normalized FFO

(Amounts in thousands)

	Six Months Ended June 30,									Quarter Ended June 30,
	2020			2019			Variance			2020			2019			Variance
Impairment – non-operating assets	$	—		$	—		$	—		$	—		$	—		$	—
Write-off of pursuit costs (other expenses)		3,278			2,987			291			1,651			1,539			112
Write-off of unamortized deferred financing costs (interest expense)		32			1,506			(1,474	)		32			1,506			(1,474	)
Write-off of unamortized (premiums)/discounts/OCI (interest expense)		—			15,141			(15,141	)		—			15,141			(15,141	)
Debt extinguishment and preferred share redemption (gains) losses		32			16,647			(16,615	)		32			16,647			(16,615	)
Net (gain) loss on sales of land parcels		—			(178	)		178			—			(177	)		177
(Income) loss from investments in unconsolidated entities ─ non-operating assets		670			430			240			229			200			29
Non-operating asset (gains) losses		670			252			418			229			23			206
Insurance/litigation settlement or reserve income (interest and other income)		(2,349	)		(383	)		(1,966	)		(767	)		(383	)		(384	)
Insurance/litigation/environmental settlement or reserve expense (other expenses)		(1,793	)		1,951			(3,744	)		(1,956	)		1,701			(3,657	)
Advocacy contributions (other expenses)		2,353			200			2,153			1,852			200			1,652
Data analytics project (other expenses)		—			2,783			(2,783	)		—			1,408			(1,408	)
Other		(521	)		(133	)		(388	)		(521	)		(83	)		(438	)
Other miscellaneous items		(2,310	)		4,418			(6,728	)		(1,392	)		2,843			(4,235	)
Adjustments from FFO to Normalized FFO	$	1,670		$	24,304		$	(22,634	)	$	520		$	21,052		$	(20,532	)

Note: See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for the definitions of non-GAAP financial measures and other terms as well as the reconciliations of EPS to FFO per share and Normalized FFO per share.

2nd Quarter 2020 Earnings Release 25

Equity Residential

Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms

(Amounts in thousands except per share and per apartment unit data)

(All per share data is diluted)

This Earnings Release and Supplemental Financial Information includes certain non-GAAP financial measures and other terms that management believes are helpful in understanding our business.  The definitions and calculations of these non-GAAP financial measures and other terms may differ from the definitions and methodologies used by other real estate investment trusts (“REIT”) and, accordingly, may not be comparable.  These non-GAAP financial measures should not be considered as an alternative to net earnings or any other measurement of performance computed in accordance with accounting principles generally accepted in the United States (“GAAP”) or as an alternative to cash flows from specific operating, investing or financing activities.  Furthermore, these non-GAAP financial measures are not intended to be a measure of cash flow or liquidity.

Acquisition Capitalization Rate or Cap Rate – NOI that the Company anticipates receiving in the next 12 months (or the year two or three stabilized NOI for properties that are in lease-up at acquisition) less an estimate of property management costs/management fees allocated to the project (generally ranging from 2.0% to 4.0% of revenues depending on the size and income streams of the asset) and less an estimate for in-the-unit replacement capital expenditures (generally ranging from $100-$450 per apartment unit depending on the age and condition of the asset) divided by the gross purchase price of the asset.  The weighted average Acquisition Cap Rate for acquired properties is weighted based on the projected NOI streams and the relative purchase price for each respective property.

Average Rental Rate – Total Residential rental revenues reflected on a straight-line basis in accordance with GAAP divided by the weighted average occupied apartment units for the reporting period presented.

Blended Rate – The weighted average of New Lease Change and Renewal Rate Achieved.

Capital Expenditures to Real Estate:

Building Improvements – Includes roof replacement, paving, building mechanical equipment systems, exterior siding and painting, major landscaping, furniture, fixtures and equipment for amenities and common areas, vehicles and office and maintenance equipment.

Renovation Expenditures – Apartment unit renovation costs (primarily kitchens and baths) designed to reposition these units for higher rental levels in their respective markets.

Replacements – Includes appliances, mechanical equipment, fixtures and flooring (including hardwood and carpeting).

Debt Balances:

Commercial Paper Program – The Company may borrow up to a maximum of $1.0 billion under its commercial paper program subject to market conditions.  The notes bear interest at various floating rates.  

Revolving Credit Facility – The Company’s $2.5 billion unsecured revolving credit facility matures November 1, 2024.  The interest rate on advances under the facility will generally be LIBOR plus a spread (currently 0.775%), or based on bids received from the lending group, and an annual facility fee (currently 0.125%).  Both the spread and the facility fee are dependent on the Company’s senior unsecured credit rating.  In addition, the Company limits its utilization of the facility in order to maintain liquidity to support its $1.0 billion commercial paper program along with certain other obligations.  The following table presents the availability on the Company’s unsecured revolving credit facility:

	June 30, 2020
Unsecured revolving credit facility commitment	$	2,500,000
Commercial paper balance outstanding		—
Unsecured revolving credit facility balance outstanding		—
Other restricted amounts		(100,949	)
Unsecured revolving credit facility availability	$	2,399,051

Debt Covenant Compliance – Our unsecured debt includes certain financial and operating covenants including, among other things, maintenance of certain financial ratios.  These provisions are contained in the indentures applicable to each notes payable or the credit agreement for our line of credit.  The Debt Covenant Compliance ratios that are provided show the Company's compliance with certain covenants governing our public unsecured debt.  These covenants generally reflect our most restrictive financial covenants.  The Company was in compliance with its unsecured debt covenants for all periods presented.

2nd Quarter 2020 Earnings Release 26

Equity Residential

Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms – Continued

(Amounts in thousands except per share and per apartment unit data)

(All per share data is diluted)

Development Yield – NOI that the Company anticipates receiving in the next 12 months following stabilization less an estimate of property management costs/management fees allocated to the project (generally ranging from 2.0% to 4.0% of revenues depending on the size and income streams of the asset) and less an estimate for in-the-unit replacement capital expenditures (generally ranging from $50-$150 per apartment unit depending on the type of asset) divided by the Total Budgeted Capital Cost of the asset.  The weighted average Development Yield for development properties is weighted based on the projected NOI streams and the relative Total Budgeted Capital Cost for each respective property.

Disposition Yield – NOI that the Company anticipates giving up in the next 12 months less an estimate of property management costs/management fees allocated to the project (generally ranging from 2.0% to 4.0% of revenues depending on the size and income streams of the asset) and less an estimate for in-the-unit replacement capital expenditures (generally ranging from $100-$450 per apartment unit depending on the age and condition of the asset) divided by the gross sales price of the asset.  The weighted average Disposition Yield for sold properties is weighted based on the projected NOI streams and the relative sales price for each respective property.

Earnings Per Share ("EPS") – Net income per share calculated in accordance with GAAP.  Expected EPS is calculated on a basis consistent with actual EPS.  Due to the uncertain timing and extent of property dispositions and the resulting gains/losses on sales, actual EPS could differ materially from expected EPS.

EBITDA for Real Estate and Normalized EBITDA for Real Estate:

Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (“EBITDAre”) – The National Association of Real Estate Investment Trusts (“Nareit”) defines EBITDAre (September 2017 White Paper) as net income (computed in accordance with GAAP) before interest expense, income taxes, depreciation and amortization expense, and further adjusted for gains and losses from sales of depreciated operating properties, impairment write-downs of depreciated operating properties, impairment write-downs of investments in unconsolidated entities caused by a decrease in value of depreciated operating properties within the joint venture and adjustments to reflect the Company’s share of EBITDAre of investments in unconsolidated entities.

The Company believes that EBITDAre is useful to investors, creditors and rating agencies as a supplemental measure of the Company’s ability to incur and service debt because it is a recognized measure of performance by the real estate industry, and by excluding gains or losses related to sales or impairment of depreciated operating properties, EBITDAre can help compare the Company’s credit strength between periods or as compared to different companies.

Normalized Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (“Normalized EBITDAre”) – Represents net income (computed in accordance with GAAP) before interest expense, income taxes, depreciation and amortization expense, and further adjusted for non-comparable items.  Normalized EBITDAre, total debt to Normalized EBITDAre and net debt to Normalized EBITDAre are important metrics in evaluating the credit strength of the Company and its ability to service its debt obligations.  The Company believes that Normalized EBITDAre, total debt to Normalized EBITDAre, and net debt to Normalized EBITDAre are useful to investors, creditors and rating agencies because they allow investors to compare the Company’s credit strength to prior reporting periods and to other companies without the effect of items that by their nature are not comparable from period to period and tend to obscure the Company’s actual credit quality.

Economic Gain (Loss) – Economic Gain (Loss) is calculated as the net gain (loss) on sales of real estate properties in accordance with GAAP, excluding accumulated depreciation.  The Company generally considers Economic Gain (Loss) to be an appropriate supplemental measure to net gain (loss) on sales of real estate properties in accordance with GAAP because it is one indication of the gross value created by the Company's acquisition, development, renovation, management and ultimate sale of a property and because it helps investors to understand the relationship between the cash proceeds from a sale and the cash invested in the sold property.  The following table presents a reconciliation of net gain (loss) on sales of real estate properties in accordance with GAAP to Economic Gain (Loss):

	Six Months Ended June 30, 2020			Quarter Ended June 30, 2020
Net Gain (Loss) on Sales of Real Estate Properties	$	352,243		$	144,266
Accumulated Depreciation Gain		(157,471	)		(88,555	)
Economic Gain (Loss)	$	194,772		$	55,711

2nd Quarter 2020 Earnings Release 27

Equity Residential

Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms – Continued

(Amounts in thousands except per share and per apartment unit data)

(All per share data is diluted)

FFO and Normalized FFO:

Funds From Operations (“FFO”) – Nareit defines FFO (December 2018 White Paper) as net income (computed in accordance with GAAP), excluding gains or losses from sales and impairment write-downs of depreciable real estate and land when connected to the main business of a REIT, impairment write-downs of investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity and depreciation and amortization related to real estate. Adjustments for partially owned consolidated and unconsolidated partnerships and joint ventures are calculated to reflect FFO on the same basis. Expected FFO per share is calculated on a basis consistent with actual FFO per share and is considered an appropriate supplemental measure of expected operating performance when compared to expected EPS.

The Company believes that FFO and FFO available to Common Shares and Units are helpful to investors as supplemental measures of the operating performance of a real estate company, because they are recognized measures of performance by the real estate industry and by excluding gains or losses from sales and impairment write-downs of depreciable real estate and excluding depreciation related to real estate (which can vary among owners of identical assets in similar condition based on historical cost accounting and useful life estimates), FFO and FFO available to Common Shares and Units can help compare the operating performance of a company’s real estate between periods or as compared to different companies.

Normalized Funds From Operations ("Normalized FFO") – Normalized FFO begins with FFO and excludes:

• the impact of any expenses relating to non-operating asset impairment;

• pursuit cost write-offs;

• gains and losses from early debt extinguishment and preferred share redemptions;

• gains and losses from non-operating assets; and

• other miscellaneous items.

Expected Normalized FFO per share is calculated on a basis consistent with actual Normalized FFO per share and is considered an appropriate supplemental measure of expected operating performance when compared to expected EPS.

The Company believes that Normalized FFO and Normalized FFO available to Common Shares and Units are helpful to investors as supplemental measures of the operating performance of a real estate company because they allow investors to compare the Company's operating performance to its performance in prior reporting periods and to the operating performance of other real estate companies without the effect of items that by their nature are not comparable from period to period and tend to obscure the Company's actual operating results.

FFO, FFO available to Common Shares and Units, Normalized FFO and Normalized FFO available to Common Shares and Units do not represent net income, net income available to Common Shares or net cash flows from operating activities in accordance with GAAP.  Therefore, FFO, FFO available to Common Shares and Units, Normalized FFO and Normalized FFO available to Common Shares and Units should not be exclusively considered as alternatives to net income, net income available to Common Shares or net cash flows from operating activities as determined by GAAP or as a measure of liquidity.  The Company's calculation of FFO, FFO available to Common Shares and Units, Normalized FFO and Normalized FFO available to Common Shares and Units may differ from other real estate companies due to, among other items, variations in cost capitalization policies for capital expenditures and, accordingly, may not be comparable to such other real estate companies.

FFO available to Common Shares and Units and Normalized FFO available to Common Shares and Units are calculated on a basis consistent with net income available to Common Shares and reflects adjustments to net income for preferred distributions and premiums on redemption of preferred shares in accordance with GAAP.  The equity positions of various individuals and entities that contributed their properties to the Operating Partnership in exchange for OP Units are collectively referred to as the "Noncontrolling Interests – Operating Partnership".  Subject to certain restrictions, the Noncontrolling Interests – Operating Partnership may exchange their OP Units for Common Shares on a one-for-one basis.  

2nd Quarter 2020 Earnings Release 28

Equity Residential

Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms – Continued

(Amounts in thousands except per share and per apartment unit data)

(All per share data is diluted)

The following table presents reconciliations of EPS to FFO per share and Normalized FFO per share for Consolidated Statements of Funds From Operations and Normalized Funds From Operations.

	Actual June			Actual June			Actual			Actual
	YTD 2020			YTD 2019			Q2 2020			Q2 2019
	Per Share			Per Share			Per Share			Per Share
EPS – Diluted	$	1.53		$	1.11		$	0.70		$	0.83
Depreciation expense		1.07			1.04			0.53			0.51
Net (gain) loss on sales		(0.88	)		(0.54	)		(0.37	)		(0.54	)
Impairment – operating assets	—				—			—			—
FFO per share – Diluted		1.72			1.61			0.86			0.80
Impairment – non-operating assets		—			—			—			—
Write-off of pursuit costs		0.01			0.01			—			0.01
Debt extinguishment and preferred share    redemption (gains) losses		—			0.04			—			0.04
Non-operating asset (gains) losses		—			—			—			—
Other miscellaneous items		(0.01	)		0.01			—			0.01
Normalized FFO per share – Diluted	$	1.72		$	1.67		$	0.86		$	0.86

Lease-Up NOI – Represents NOI for development properties: (i) in various stages of lease-up; and (ii) where lease-up has been completed but the properties were not stabilized (defined as having achieved 90% occupancy for three consecutive months) for all of the current and comparable periods presented.

Net Operating Income (“NOI”) – NOI is the Company’s primary financial measure for evaluating each of its apartment properties.  NOI is defined as rental income less direct property operating expenses (including real estate taxes and insurance).  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.  NOI does not include an allocation of property management expenses either in the current or comparable periods.  Rental income for all leases and operating expense for ground leases (for both same store and non-same store properties) are reflected on a straight-line basis in accordance with GAAP for the current and comparable periods.

The following tables present reconciliations of operating income per the consolidated statements of operations to NOI, along with rental income, operating expenses and NOI per the consolidated statements of operations allocated between same store and non-same store/other results (see Same Store Results):

	Six Months Ended June 30,						Quarter Ended June 30,
	2020			2019			2020			2019
Operating income	$	778,974		$	578,894		$	356,889		$	369,117
Adjustments:
Property management		51,317			50,765			23,608			24,369
General and administrative		26,353			29,710			11,835			14,329
Depreciation		418,398			404,723			205,976			200,508
Net (gain) loss on sales of real estate    properties		(352,243	)		(138,835	)		(144,266	)		(138,856	)
Total NOI	$	922,799		$	925,257		$	454,042		$	469,467
Rental income:
Same store	$	1,260,825		$	1,258,261		$	623,275		$	637,915
Non-same store/other		75,012			73,415			30,257			31,459
Total rental income		1,335,837			1,331,676			653,532			669,374
Operating expenses:
Same store		386,742			382,188			190,021			190,277
Non-same store/other		26,296			24,231			9,469			9,630
Total operating expenses		413,038			406,419			199,490			199,907
NOI:
Same store		874,083			876,073			433,254			447,638
Non-same store/other		48,716			49,184			20,788			21,829
Total NOI	$	922,799		$	925,257		$	454,042		$	469,467

2nd Quarter 2020 Earnings Release 29

Equity Residential

Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms – Continued

(Amounts in thousands except per share and per apartment unit data)

(All per share data is diluted)

New Lease Change–The change in rent for a lease with a new or transferring resident compared to the rent for the prior lease of the identical apartment unit, regardless of lease term and without concessions or discounts being applied.

Non-Residential – Consists of revenues and expenses from retail and public parking garage operations.

Non-Same Store Properties – For annual comparisons, primarily includes all properties acquired during 2019 and 2020, plus any properties in lease-up and not stabilized as of January 1, 2019.

Physical Occupancy – The weighted average occupied apartment units for the reporting period divided by the average of total apartment units available for rent for the reporting period.

Renewal Rate Achieved – The change in rent for a new lease on an apartment unit where the lease has been renewed as compared to the rent for the prior lease of the identical apartment unit, regardless of lease term and without concessions or discounts being applied.

Residential – Consists of multifamily apartment revenues and expenses.

Same Store Operating Expenses:

On-site Payroll – Includes payroll and related expenses for on-site personnel including property managers, leasing consultants, and maintenance staff.

Other On-site Operating Expenses – Includes ground lease costs and administrative costs such as office supplies, telephone and data charges and association and business licensing fees.

Repairs and Maintenance – Includes general maintenance costs, apartment unit turnover costs including interior painting, routine landscaping, security, exterminating, fire protection, snow removal, elevator, roof and parking lot repairs and other miscellaneous building repair and maintenance costs.

Utilities – Represents gross expenses prior to any recoveries under the Resident Utility Billing System (“RUBS”). Recoveries are reflected in rental income.

Same Store Properties – For annual comparisons, primarily includes all properties acquired or completed that are stabilized prior to January 1, 2019, less properties subsequently sold.  Properties are included in Same Store when they are stabilized for all of the current and comparable periods presented.

% of Stabilized Budgeted NOI – Represents original budgeted 2020 NOI for stabilized properties and projected annual NOI at stabilization (defined as having achieved 90% occupancy for three consecutive months) for properties that are in lease-up.

Total Budgeted Capital Cost – Estimated remaining cost for projects under development and/or developed plus all capitalized costs incurred to date, including land acquisition costs, construction costs, capitalized real estate taxes and insurance, capitalized interest and loan fees, permits, professional fees, allocated development overhead and other regulatory fees, plus any estimates of costs remaining to be funded for all projects, all in accordance with GAAP.

Total Market Capitalization – The aggregate of the market value of the Company’s outstanding common shares, including restricted shares, the market value of the Company’s operating partnership units outstanding, including restricted units (based on the market value of the Company’s common shares) and the outstanding principal balance of debt.  The Company believes this is a useful measure of a real estate operating company’s long-term liquidity and balance sheet strength, because it shows an approximate relationship between a company’s total debt and the current total market value of its assets based on the current price at which the Company’s common shares trade.  However, because this measure of leverage changes with fluctuations in the Company’s share price, which occur regularly, this measure may change even when the Company’s earnings, interest and debt levels remain stable.

Traffic – Consists of an expression of interest in an apartment by completing an in-person tour, self-guided tour or virtual tour that may result in an application to lease.

Transaction Accretion (Dilution) – Represents the spread between the Acquisition Cap Rate and the Disposition Yield.

Turnover – Total Residential move-outs (including inter-property and intra-property transfers) divided by total Residential apartment units.

2nd Quarter 2020 Earnings Release 30

Equity Residential

Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms – Continued

(Amounts in thousands except per share and per apartment unit data)

(All per share data is diluted)

Unencumbered NOI % – Represents NOI generated by consolidated real estate assets unencumbered by outstanding secured debt as a percentage of total NOI generated by all of the Company's consolidated real estate assets.

Unlevered Internal Rate of Return (“IRR”) – The Unlevered IRR on sold properties is the compound annual rate of return calculated by the Company based on the timing and amount of: (i) the gross purchase price of the property plus any direct acquisition costs incurred by the Company; (ii) total revenues earned during the Company’s ownership period; (iii) total direct property operating expenses (including real estate taxes and insurance) incurred during the Company’s ownership period; (iv) capital expenditures incurred during the Company’s ownership period; and (v) the gross sales price of the property net of selling costs.

The calculation of the Unlevered IRR does not include an adjustment for the Company’s property management expense, general and administrative expense or interest expense (including loan assumption costs and other loan-related costs).  Therefore, the Unlevered IRR is not a substitute for net income as a measure of our performance.  Management believes that the Unlevered IRR achieved during the period a property is owned by the Company is useful because it is one indication of the gross value created by the Company’s acquisition, development, renovation, management and ultimate sale of a property, before the impact of Company overhead.  The Unlevered IRR achieved on the properties as cited in this release should not be viewed as an indication of the gross value created with respect to other properties owned by the Company, and the Company does not represent that it will achieve similar Unlevered IRRs upon the disposition of other properties.  The weighted average Unlevered IRR for sold properties is weighted based on all cash flows over the investment period for each respective property, including net sales proceeds.

Weighted Average Coupons – Contractual interest rate for each debt instrument weighted by principal balances as of June 30, 2020.  In case of debt for which fair value hedges are in place, the rate payable under the corresponding derivatives is used in lieu of the contractual interest rate.

Weighted Average Rates – Interest expense for each debt instrument for the six months ended June 30, 2020 weighted by its average principal balance for the same period.  Interest expense includes amortization of premiums, discounts and other comprehensive income on debt and related derivative instruments.  In case of debt for which derivatives are in place, the income or expense recognized under the corresponding derivatives is included in the total interest expense for the period.

2nd Quarter 2020 Earnings Release 31