Segment Information

3 Months Ended

Mar. 31, 2017

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company's segment disclosures present the measure used by the chief operating decision makers for purposes of assessing each segment's performance. Essex's chief operating decision makers are comprised of several members of its executive management team who use NOI to assess the performance of the business for the Company's reportable operating segments. NOI represents total property revenue less direct property operating expenses.

The executive management team evaluates the Company's operating performance geographically. The Company defines its reportable operating segments as the three geographical regions in which its communities are located: Southern California, Northern California, and Seattle Metro.

Excluded from segment revenues and net operating income are management and other fees from affiliates and interest and other income. Non-segment revenues and net operating income included in the following schedule also consist of revenue generated from commercial properties and properties that have been sold. Other non-segment assets include real estate under development, co-investments, real estate held for sale, net, cash and cash equivalents, marketable securities, notes and other receivables, and prepaid expenses and other assets.

The revenues and net operating income for each of the reportable operating segments are summarized as follows for the three months ended March 31, 2017 and 2016 ($ in thousands):

	Three Months Ended March 31,
	2017			2016
Revenues:
Southern California	$	147,099		$	135,894
Northern California	123,308			110,408
Seattle Metro	56,192			52,073
Other real estate assets	6,569			13,803
Total property revenues	$	333,168		$	312,178
Net operating income:
Southern California	$	101,405		$	92,654
Northern California	87,663			79,013
Seattle Metro	38,933			35,689
Other real estate assets	5,654			10,332
Total net operating income	233,655			217,688
Management and other fees from affiliates	2,236			2,024
Depreciation and amortization	(115,503		)	(109,707		)
General and administrative	(10,601		)	(9,182		)
Acquisition and investment related costs	(556		)	(828		)
Interest expense	(54,583		)	(52,466		)
Total return swap income	2,584			3,123
Interest and other income	6,764			5,208
Equity income from co-investments	10,899			15,068
Gain on sale of real estate and land	26,174			20,258
Deferred tax expense on gain on sale of real estate and land	—			(4,279		)
Gain on remeasurement of co-investment	86,482			—
Net income	$	187,551		$	86,907

Total assets for each of the reportable operating segments are summarized as follows as of March 31, 2017 and December 31, 2016 ($ in thousands):

	March 31, 2017		December 31, 2016
Assets:
Southern California	$	4,885,678	$	4,924,792
Northern California	4,293,943		3,791,549
Seattle Metro	1,555,853		1,570,340
Other real estate assets	57,210		78,079
Net reportable operating segment - real estate assets	10,792,684		10,364,760
Real estate under development	239,685		190,505
Co-investments	1,071,258		1,161,275
Real estate held for sale, net	—		101,957
Cash and cash equivalents, including restricted cash	100,252		170,302
Marketable securities	138,977		139,189
Notes and other receivables	50,855		40,970
Prepaid expenses and other assets	53,716		48,450
Total assets	$	12,447,427	$	12,217,408