Net Income Per Common Share and Net Income Per Common Unit

Essex Property Trust, Inc.

Basic and diluted income from continuing and discontinued operations per share is calculated as follows for the years ended December 31 ($ in thousands, except share and per share amounts):



	2014					2013					2012
	Income		Weighted- average Common Shares	Per Common Share Amount		Income		Weighted- average Common Shares	Per Common Share Amount		Income		Weighted- average Common Shares	Per Common Share Amount
Basic:
Income from continuing operations available to common stockholders	$	116,859	56,546,959	$	2.07	$	121,324	37,248,960	$	3.26	$	108,532	35,032,491	$	3.10

Income from discontinued operations available to common stockholders	—		56,546,959	—		29,487		37,248,960	0.79		11,280		35,032,491	0.32
	$	116,859		$	2.07	$	150,811		$	4.05	$	119,812		$	3.42
Effect of Dilutive Securities (1)	—		149,566			—		86,335			—		92,430
Diluted:
Income from continuing operations available to common stockholders (1)	$	116,859	56,696,525	$	2.06	$	121,324	37,335,295	$	3.25	$	108,532	35,124,921	$	3.09

Income from discontinued operations available to common stockholders	—		56,696,525	—		29,487		37,335,295	0.79		11,280		35,124,921	0.32
	$	116,859		$	2.06	$	150,811		$	4.04	$	119,812		$	3.41

(1)

Weighted average convertible limited partnership units of 2,224,707, 2,131,425, and 2,219,046, which include vested Series Z Incentive Units, Series Z-1 Incentive Units, 2014 Long-Term Incentive Plan Units, and 2015 Long-Term Incentive Plan Units (collectively referred to as “LTIP Units”), for the years ended December 31, 2014, 2013 and 2012, respectively, were not included in the determination of diluted earnings per share calculation because they were anti-dilutive. The Company has the ability to redeem DownREIT limited partnership units for cash and does not consider them to be potentially dilutive securities.

Stock options of 10,843; 168,325; and 263,613; for the years ended December 31, 2014, 2013, and 2012, respectively, were not included in the diluted earnings per share calculation because the assumed proceeds per share of these options plus the average unearned compensation were greater than the average market price of the common shares for the years ended and, therefore, were anti-dilutive.

All shares of cumulative convertible Series G preferred stock have been excluded from diluted earnings per share for the years ended 2014, 2013, and 2012 respectively, as the effect was anti-dilutive.

Essex Portfolio, L.P.

Basic and diluted income from continuing and discontinued operations per unit is calculated as follows for the years ended December 31 ($ in thousands, except unit and per unit amounts):



	2014					2013					2012
	Income		Weighted- average Common Units	Per Common Unit Amount		Income		Weighted- average Common Units	Per Common Unit Amount		Income		Weighted- average Common Units	Per Common Unit Amount
Basic:
Income from continuing operations available to common unitholders	$	121,726	58,771,666	$	2.07	$	128,576	39,380,385	$	3.27	$	115,834	37,251,537	$	3.11
Income from discontinued operations	—		58,771,666	—		31,173		39,380,385	0.79		11,937		37,251,537	0.32
Income available to common unitholders	$	121,726		$	2.07	$	159,749		$	4.06	$	127,771		$	3.43
Effect of Dilutive Securities (1)	—		149,566			—		86,335			—		92,430

Diluted:
Income from continuing operations available to common unitholders (1)	$	121,726	58,921,232	$	2.07	$	128,576	39,466,720	$	3.26	$	115,834	37,343,967	$	3.10
Income from discontinued operations	—		58,921,232	—		31,173		39,466,720	0.79		11,937		37,343,967	0.32
Income available to common unitholders	$	121,726		$	2.07	$	159,749		$	4.05	$	127,771		$	3.42


(1)	The Operating Partnership has the ability to redeem DownREIT limited partnership units for cash and does not consider them to be potentially dilutive securities.

Stock options of 10,843; 168,325; and 263,613; for the years ended December 31, 2014, 2013, and 2012, respectively, were not included in the diluted earnings per unit calculation because the assumed proceeds per share of these options plus the average unearned compensation were greater than the average market price of the common shares for the years ended and, therefore, were anti-dilutive.

The cumulative convertible Series G preferred interest have been excluded from diluted earnings per unit for the years ended 2014, 2013, and 2012 respectively, as the effect was anti-dilutive.