10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2019

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________to _________

Commission file number 001-13106 (Essex Property Trust, Inc.)

Commission file number 333-44467-01 (Essex Portfolio, L.P.)

ESSEX PROPERTY TRUST, INC.

ESSEX PORTFOLIO, L.P.

(Exact name of Registrant as Specified in its Charter)

Maryland	77-0369576
(Essex Property Trust, Inc.)	(Essex Property Trust, Inc.)
California	77-0369575
(Essex Portfolio, L.P.)	(Essex Portfolio, L.P.)
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification Number)

1100 Park Place, Suite 200

San Mateo, California 94403

(Address of Principal Executive Offices, Including Zip Code)

(650) 655-7800

(Registrant's Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act: 

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.0001 par value (Essex Property Trust, Inc.)	ESS	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file reports), and (2) has been subject to such filing requirements for the past 90 days.

Essex Property Trust, Inc. Yes ☒ No ☐ Essex Portfolio, L.P. Yes ☒ No ☐

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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Essex Property Trust, Inc. Yes ☒ No ☐ Essex Portfolio, L.P. Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):

Essex Property Trust, Inc.:

Large accelerated filer	☒	Accelerated filer	☐	Non-accelerated filer	☐	Smaller reporting company	☐
						Emerging growth company	☐

Essex Portfolio, L.P.:

Large accelerated filer	☐	Accelerated filer	☐	Non-accelerated filer	☒	Smaller reporting company	☐
						Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Essex Property Trust, Inc. ☐ Essex Portfolio, L.P. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Essex Property Trust, Inc. Yes ☐ No ☒ Essex Portfolio, L.P. Yes ☐ No ☒

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: 66,081,652 shares of Common Stock ($0.0001 par value) of Essex Property Trust, Inc. were outstanding as of October 22, 2019.

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EXPLANATORY NOTE

This report combines the reports on Form 10-Q for the three and nine month periods ended September 30, 2019 of Essex Property Trust, Inc., a Maryland corporation, and Essex Portfolio, L.P., a Delaware limited partnership of which Essex Property Trust, Inc. is the sole general partner.

Unless stated otherwise or the context otherwise requires, references to the "Company," "we," "us" or "our" mean collectively Essex Property Trust, Inc. and those entities/subsidiaries owned or controlled by Essex Property Trust, Inc., including Essex Portfolio, L.P., and references to the "Operating Partnership" mean Essex Portfolio, L.P. and those entities/subsidiaries owned or controlled by Essex Portfolio, L.P. Unless stated otherwise or the context otherwise requires, references to "Essex" mean Essex Property Trust, Inc., not including any of its subsidiaries.

Essex operates as a self-administered and self-managed real estate investment trust ("REIT"), and is the sole general partner of the Operating Partnership. As the sole general partner of the Operating Partnership, Essex has exclusive control of the Operating Partnership's day-to-day management.

The Company is structured as an umbrella partnership REIT ("UPREIT") and Essex contributes all net proceeds from its various equity offerings to the Operating Partnership. In return for those contributions, Essex receives a number of Operating Partnership limited partnership units ("OP Units," and the holders of such OP Units, "Unitholders") equal to the number of shares of common stock it has issued in the equity offerings. Contributions of properties to the Company can be structured as tax-deferred transactions through the issuance of OP Units, which is one of the reasons why the Company is structured in the manner outlined above. Based on the terms of the Operating Partnership's partnership agreement, OP Units can be exchanged into Essex common stock on a one-for-one basis. The Company maintains a one-for-one relationship between the OP Units issued to Essex and shares of common stock.

The Company believes that combining the reports on Form 10-Q of Essex and the Operating Partnership into this single report provides the following benefits:

• enhances investors' understanding of Essex and the Operating Partnership by enabling investors to view the business as a whole in the same manner as management views and operates the business;

• eliminates duplicative disclosure and provides a more streamlined and readable presentation since a substantial portion of the disclosure applies to both Essex and the Operating Partnership; and

• creates time and cost efficiencies through the preparation of one combined report instead of two separate reports.

Management operates Essex and the Operating Partnership as one business. The management of Essex consists of the same members as the management of the Operating Partnership.

All of the Company's property ownership, development, and related business operations are conducted through the Operating Partnership and Essex has no material assets, other than its investment in the Operating Partnership. Essex's primary function is acting as the general partner of the Operating Partnership. As general partner with control of the Operating Partnership, Essex consolidates the Operating Partnership for financial reporting purposes. Therefore, the assets and liabilities of Essex and the Operating Partnership are the same on their respective financial statements. Essex also issues equity from time to time and guarantees certain debt of the Operating Partnership, as disclosed in this report. The Operating Partnership holds substantially all of the assets of the Company, including the Company's ownership interests in its co-investments. The Operating Partnership conducts the operations of the business and is structured as a partnership with no publicly traded equity. Except for the net proceeds from equity offerings by the Company, which are contributed to the capital of the Operating Partnership in exchange for OP Units (on a one-for-one share of common stock per OP Unit basis), the Operating Partnership generates all remaining capital required by the Company's business. These sources of capital include the Operating Partnership's working capital, net cash provided by operating activities, borrowings under its revolving credit facilities, the issuance of secured and unsecured debt and equity securities and proceeds received from disposition of certain properties and co-investments.

The Company believes it is important to understand the few differences between Essex and the Operating Partnership in the context of how Essex and the Operating Partnership operate as a consolidated company. Stockholders' equity, partners' capital and noncontrolling interest are the main areas of difference between the condensed consolidated financial statements of Essex and those of the Operating Partnership. The limited partners of the Operating Partnership are accounted for as partners' capital in the Operating Partnership's condensed consolidated financial statements and as noncontrolling interest in Essex’s condensed consolidated financial statements. The noncontrolling interest in the Operating Partnership's condensed consolidated financial statements include the interest of unaffiliated partners in various consolidated partnerships and co-investment partners. The noncontrolling interest in Essex's condensed consolidated financial statements include (i) the same noncontrolling interest as

iii

presented in the Operating Partnership’s condensed consolidated financial statements and (ii) OP Unitholders. The differences between stockholders' equity and partners' capital result from differences in the equity issued at Essex and Operating Partnership levels.

To help investors understand the significant differences between Essex and the Operating Partnership, this report on Form 10-Q provides separate consolidated financial statements for Essex and the Operating Partnership; a single set of consolidated notes to such financial statements that includes separate discussions of stockholders' equity or partners' capital, and earnings per share/unit, as applicable; and a combined Management's Discussion and Analysis of Financial Condition and Results of Operations.

This report on Form 10-Q also includes separate Part I, Item 4. Controls and Procedures sections and separate Exhibits 31 and 32 certifications for each of Essex and the Operating Partnership in order to establish that the requisite certifications have been made and that Essex and the Operating Partnership are compliant with Rule 13a-15 or Rule 15d-15 of the Securities Exchange Act of 1934 (the "Exchange Act") and 18 U.S.C. §1350.

In order to highlight the differences between Essex and the Operating Partnership, the separate sections in this report on Form 10-Q for Essex and the Operating Partnership specifically refer to Essex and the Operating Partnership. In the sections that combine disclosure of Essex and the Operating Partnership, this report refers to actions or holdings as being actions or holdings of the Company. Although the Operating Partnership is generally the entity that directly or indirectly enters into contracts and co-investments and holds assets and debt, reference to the Company is appropriate because the Company is one business and the Company operates that business through the Operating Partnership. The separate discussions of Essex and the Operating Partnership in this report should be read in conjunction with each other to understand the results of the Company on a consolidated basis and how management operates the Company.

The information furnished in the accompanying unaudited condensed consolidated balance sheets, statements of income and comprehensive income, equity, capital, and cash flows of the Company and the Operating Partnership reflect all adjustments which are, in the opinion of management, necessary for a fair presentation of the aforementioned condensed consolidated financial statements for the interim periods and are normal and recurring in nature, except as otherwise noted.

The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the notes to such unaudited condensed consolidated financial statements and Management's Discussion and Analysis of Financial Condition and Results of Operations herein. Additionally, these unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Company's annual report on Form 10-K for the year ended December 31, 2018.

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ESSEX PROPERTY TRUST, INC.

ESSEX PORTFOLIO, L.P.

FORM 10-Q

INDEX

PART I. FINANCIAL INFORMATION		Page No.
Item 1.	Condensed Consolidated Financial Statements of Essex Property Trust, Inc. (Unaudited)
	Condensed Consolidated Balance Sheets as of September 30, 2019 and December 31, 2018	2
	Condensed Consolidated Statements of Income and Comprehensive Income for the three and nine months ended September 30, 2019 and 2018	3
	Condensed Consolidated Statements of Equity for the three and nine months ended September 30, 2019 and 2018	4
	Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2019 and 2018	8
	Condensed Consolidated Financial Statements of Essex Portfolio, L.P. (Unaudited)
	Condensed Consolidated Balance Sheets as of September 30, 2019 and December 31, 2018	10
	Condensed Consolidated Statements of Income and Comprehensive Income for the three and nine months ended September 30, 2019 and 2018	11
	Condensed Consolidated Statements of Capital for the three and nine months ended September 30, 2019 and 2018	12
	Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2019 and 2018	16
	Notes to Condensed Consolidated Financial Statements	18
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	40
Item 3.	Quantitative and Qualitative Disclosures About Market Risks	50
Item 4.	Controls and Procedures	51
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	52
Item 1A.	Risk Factors	52
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	52
Item 3.	Defaults Upon Senior Securities	53
Item 4.	Mine Safety Disclosures	53
Item 5.	Other Information	53
Item 6.	Exhibits	54
Signatures		55

1

Part I – Financial Information

Item 1. Condensed Consolidated Financial Statements

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Unaudited)

(In thousands, except parenthetical and share amounts)

ASSETS	September 30, 2019			December 31, 2018
Real estate:
Rental properties:
Land and land improvements	$	2,766,344		$	2,701,356
Buildings and improvements	11,180,806			10,664,745
	13,947,150			13,366,101
Less: accumulated depreciation	(3,567,632		)	(3,209,548		)
	10,379,518			10,156,553
Real estate under development	562,338			454,629
Co-investments	1,413,861			1,300,140
	12,355,717			11,911,322
Cash and cash equivalents-unrestricted	74,031			134,465
Cash and cash equivalents-restricted	17,695			16,930
Marketable securities	216,894			209,545
Notes and other receivables (includes related party receivables of $144.6 million and $11.1 million as of September 30, 2019 and December 31, 2018, respectively)	216,541			71,895
Operating lease right-of-use assets	75,478			—
Prepaid expenses and other assets	41,536			39,439
Total assets	$	12,997,892		$	12,383,596
LIABILITIES AND EQUITY
Unsecured debt, net	$	4,686,171		$	3,799,316
Mortgage notes payable, net	1,141,970			1,806,626
Lines of credit	220,000			—
Accounts payable and accrued liabilities	193,341			127,086
Construction payable	53,214			59,345
Dividends payable	135,492			128,529
Operating lease liabilities	77,495			—
Other liabilities	36,128			33,375
Total liabilities	6,543,811			5,954,277
Commitments and contingencies
Redeemable noncontrolling interest	39,077			35,475
Equity:
Common stock; $0.0001 par value, 670,000,000 shares authorized; 66,081,635 and 65,890,322 shares issued and outstanding, respectively	7			7
Additional paid-in capital	7,131,642			7,093,079
Distributions in excess of accumulated earnings	(887,521		)	(812,796		)
Accumulated other comprehensive loss, net	(19,028		)	(13,217		)
Total stockholders' equity	6,225,100			6,267,073
Noncontrolling interest	189,904			126,771
Total equity	6,415,004			6,393,844
Total liabilities and equity	$	12,997,892		$	12,383,596

See accompanying notes to the unaudited condensed consolidated financial statements.

2

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Income and Comprehensive Income

(Unaudited)

(In thousands, except share and per share amounts)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Revenues:
Rental and other property	$	364,504		$	348,610		$	1,077,767		$	1,040,083
Management and other fees from affiliates	2,428			2,307			7,023			6,812
	366,932			350,917			1,084,790			1,046,895
Expenses:
Property operating, excluding real estate taxes	63,181			59,100			181,241			174,461
Real estate taxes	39,290			38,675			114,993			112,423
Corporate-level property management expenses	8,255			7,761			24,620			23,313
Depreciation and amortization	120,809			120,852			360,842			359,287
General and administrative	11,345			10,601			38,731			36,539
Expensed acquisition and investment related costs	13			31			69			156
	242,893			237,020			720,496			706,179
Gain on sale of real estate and land	—			—			—			22,244
Earnings from operations	124,039			113,897			364,294			362,960
Interest expense	(54,896		)	(55,196		)	(162,651		)	(166,335		)
Total return swap income	2,154			2,184			6,174			6,682
Interest and other income	8,685			8,437			29,293			21,241
Equity income from co-investments	21,700			16,788			54,935			64,611
Deferred tax expense on unrealized gain on unconsolidated co-investment	(1,457		)	—			(1,457		)	—
Gain on early retirement of debt, net	5,475			—			7,143			—
Gain on remeasurement of co-investment	—			—			31,535			—
Net income	105,700			86,110			329,266			289,159
Net income attributable to noncontrolling interest	(6,365		)	(5,135		)	(18,798		)	(16,826		)
Net income available to common stockholders	$	99,335		$	80,975		$	310,468		$	272,333
Comprehensive income	$	105,663		$	89,100		$	323,071		$	301,708
Comprehensive income attributable to noncontrolling interest	(6,364		)	(5,235		)	(18,589		)	(17,243		)
Comprehensive income attributable to controlling interest	$	99,299		$	83,865		$	304,482		$	284,465
Per share data:
Basic:
Net income available to common stockholders	$	1.51		$	1.23		$	4.72		$	4.12
Weighted average number of shares outstanding during the period	65,850,524			66,052,108			65,757,914			66,047,990
Diluted:
Net income available to common stockholders	$	1.51		$	1.22		$	4.71		$	4.12
Weighted average number of shares outstanding during the period	65,973,085			66,103,812			65,857,660			66,093,004

See accompanying notes to the unaudited condensed consolidated financial statements.

3

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Equity for the three and nine months ended September 30, 2019 and 2018

(Unaudited)

(In thousands)

	Common stock			Additional paid-in capital			Distributions in excess of accumulated earnings			Accumulated other comprehensive loss, net			Noncontrolling Interest
Three Months Ended September 30, 2019	Shares	Amount														Total
Balances at June 30, 2019	65,727	$	7	$	7,031,886		$	(857,994	)	$	(18,992	)	$	190,209		$	6,345,116
Net income	—	—		—			99,335			—			6,365			105,700
Change in fair value of derivatives and amortization of swap settlements	—	—		—			—			(12		)	—			(12		)
Change in fair value of marketable debt securities, net	—	—		—			—			(24		)	(1		)	(25		)
Issuance of common stock under:
Stock option and restricted stock plans, net	126	—		27,679			—			—			—			27,679
Sale of common stock, net	228	—		72,631			—			—			—			72,631
Equity based compensation costs	—	—		1,544			—			—			270			1,814
Changes in the redemption value of redeemable noncontrolling interest	—	—		(2,309		)	—			—			62			(2,247		)
Distributions to noncontrolling interest	—	—		—			—			—			(6,789		)	(6,789		)
Redemptions of noncontrolling interest	1	—		211			—			—			(212		)	(1		)
Common stock dividends ($1.95 per share)	—	—		—			(128,862		)	—			—			(128,862		)
Balances at September 30, 2019	66,082	$	7	$	7,131,642		$	(887,521	)	$	(19,028	)	$	189,904		$	6,415,004

4

	Common stock				Additional paid-in capital			Distributions in excess of accumulated earnings			Accumulated other comprehensive loss, net			Noncontrolling Interest
Nine Months Ended September 30, 2019	Shares		Amount														Total
Balances at December 31, 2018	65,890		$	7	$	7,093,079		$	(812,796	)	$	(13,217	)	$	126,771		$	6,393,844
Net income	—		—		—			310,468			—			18,798			329,266
Reversal of unrealized gains upon the sale of marketable debt securities	—		—		—			—			(31		)	(1		)	(32		)
Change in fair value of derivatives and amortization of swap settlements	—		—		—			—			(6,152		)	(214		)	(6,366		)
Change in fair value of marketable debt securities, net	—		—		—			—			197			6			203
Issuance of common stock under:
Stock option and restricted stock plans, net	188		—		32,907			—			—			—			32,907
Sale of common stock, net	228		—		72,549			—			—			—			72,549
Equity based compensation costs	—		—		7,016			—			—			898			7,914
Retirement of common stock, net	(234	)	—		(56,989		)	—			—			—			(56,989		)
Cumulative effect upon adoption of ASU No. 2017-12	—		—		—			—			175			6			181
Changes in the redemption value of redeemable noncontrolling interest	—		—		(5,048		)	—			—			1,373			(3,675		)
Changes in noncontrolling interest from acquisition	—		—		—			—			—			65,472			65,472
Distributions to noncontrolling interest	—		—		—			—			—			(20,897		)	(20,897		)
Redemptions of noncontrolling interest	10		—		(11,872		)	—			—			(2,308		)	(14,180		)
Common stock dividends ($5.85 per share)	—		—		—			(385,193		)	—			—			(385,193		)
Balances at September 30, 2019	66,082		$	7	$	7,131,642		$	(887,521	)	$	(19,028	)	$	189,904		$	6,415,004

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	Common stock			Additional paid-in capital			Distributions in excess of accumulated earnings			Accumulated other comprehensive loss, net			Noncontrolling Interest
Three Months Ended September 30, 2018	Shares	Amount														Total
Balances at June 30, 2018	66,050	$	7	$	7,131,809		$	(766,193	)	$	(11,438	)	$	120,498		$	6,474,683
Net income	—	—		—			80,975			—			5,135			86,110
Reversal of unrealized losses upon the sale of marketable debt securities	—	—		—			—			4			—			4
Change in fair value of derivatives and amortization of swap settlements	—	—		—			—			2,875			99			2,974
Change in fair value of marketable debt securities, net	—	—		—			—			11			1			12
Issuance of common stock under:
Stock option and restricted stock plans, net	5	—		887			—			—			—			887
Sale of common stock, net	—	—		(130		)	—			—			—			(130		)
Equity based compensation costs	—	—		1,496			—			—			251			1,747
Changes in the redemption value of redeemable noncontrolling interest	—	—		(386		)	—			—			(22		)	(408		)
Distributions to noncontrolling interest	—	—		—			—			—			(6,884		)	(6,884		)
Redemptions of noncontrolling interest	—	—		(89		)	—			—			(11		)	(100		)
Common stock dividends ($1.86 per share)	—	—		—			(122,867		)	—			—			(122,867		)
Balances at September 30, 2018	66,055	$	7	$	7,133,587		$	(808,085	)	$	(8,548	)	$	119,067		$	6,436,028

6

	Common stock				Additional paid-in capital			Distributions in excess of accumulated earnings			Accumulated other comprehensive loss, net			Noncontrolling Interest
Nine Months Ended September 30, 2018	Shares		Amount														Total
Balances at December 31, 2017	66,054		$	7	$	7,129,571		$	(833,726	)	$	(18,446	)	$	119,419		$	6,396,825
Net income	—		—		—			272,333			—			16,826			289,159
Reversal of unrealized losses upon the sale of marketable debt securities	—		—		—			—			6			—			6
Change in fair value of derivatives and amortization of swap settlements	—		—		—			—			12,210			420			12,630
Change in fair value of marketable debt securities, net	—		—		—			—			(84		)	(3		)	(87		)
Issuance of common stock under:
Stock option and restricted stock plans, net	17		—		2,751			—			—			—			2,751
Sale of common stock, net	—		—		(483		)	—			—			—			(483		)
Equity based compensation costs	—		—		7,697			—			—			864			8,561
Retirement of common stock, net	(17	)	—		(3,774		)	—			—			—			(3,774		)
Cumulative effect upon adoption of ASU No. 2016-01	—		—		—			2,234			(2,234		)	—			—
Cumulative effect upon adoption of ASU No. 2017-05	—		—		—			119,651			—			4,057			123,708
Changes in the redemption value of redeemable noncontrolling interest	—		—		(2,032		)	—			—			(221		)	(2,253		)
Distributions to noncontrolling interest	—		—		—			—			—			(22,281		)	(22,281		)
Redemptions of noncontrolling interest	1		—		(143		)	—			—			(14		)	(157		)
Common stock dividends ($5.58 per share)	—		—		—			(368,577		)	—			—			(368,577		)
Balances at September 30, 2018	66,055		$	7	$	7,133,587		$	(808,085	)	$	(8,548	)	$	119,067		$	6,436,028

See accompanying notes to the unaudited condensed consolidated financial statements.

7

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands, except parenthetical amounts) 

	Nine Months Ended September 30,
	2019			2018
Cash flows from operating activities:
Net income	$	329,266		$	289,159
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	360,842			359,287
Amortization of discount on marketable securities	(16,673		)	(12,949		)
Amortization of discount (premium) and debt financing costs, net	3,454			(1,958		)
Gain on sale of marketable securities	(737		)	(669		)
Unrealized (gain) loss on equity securities recognized through income	(4,280		)	(426		)
Company's share of gain on the sales of co-investments	(870		)	—
Earnings from co-investments	(54,065		)	(64,611		)
Operating distributions from co-investments	64,628			80,232
Accrued interest from notes and other receivables	(4,523		)	(4,016		)
Gain on the sale of real estate and land	—			(22,244		)
Equity-based compensation	6,748			7,209
Gain on early retirement of debt, net	(7,143		)	—
Gain on remeasurement of co-investment	(31,535		)	—
Changes in operating assets and liabilities:
Prepaid expenses, receivables, operating lease right-of-use assets, and other assets	(4,192		)	(4,044		)
Accounts payable, accrued liabilities, and operating lease liabilities	64,281			55,469
Other liabilities	1,726			698
Net cash provided by operating activities	706,927			681,137
Cash flows from investing activities:
Additions to real estate:
Acquisitions of real estate and acquisition related capital expenditures	(93,389		)	(7,807		)
Redevelopment	(55,027		)	(54,656		)
Development acquisitions of and additions to real estate under development	(130,593		)	(131,867		)
Capital expenditures on rental properties	(69,348		)	(54,890		)
Investments in notes receivable	(140,663		)	—
Collections of notes and other receivables	2,500			29,500
Proceeds from insurance for property losses	3,599			1,237
Proceeds from dispositions of real estate	—			130,730
Contributions to co-investments	(306,233		)	(100,202		)
Changes in refundable deposits	325			(3,804		)
Purchases of marketable securities	(42,653		)	(29,130		)
Sales and maturities of marketable securities	57,165			22,501
Non-operating distributions from co-investments	70,064			62,564
Net cash used in investing activities	(704,253		)	(135,824		)
Cash flows from financing activities:
Proceeds from unsecured debt and mortgage notes	892,762			298,773
Payments on unsecured debt and mortgage notes	(800,746		)	(162,317		)
Proceeds from lines of credit	1,485,034			454,170
Repayments of lines of credit	(1,265,034		)	(633,170		)
Retirement of common stock	(56,989		)	(3,774		)
Additions to deferred charges	(9,446		)	(4,093		)
Net proceeds from issuance of common stock	72,549			(483		)
Net proceeds from stock options exercised	36,422			2,751
Payments related to tax withholding for share-based compensation	(3,515		)	(23		)

8

	Nine Months Ended September 30,
	2019			2018
Distributions to noncontrolling interest	(20,269		)	(22,137		)
Redemption of noncontrolling interest	(14,180		)	(157		)
Redemption of redeemable noncontrolling interest	(73		)	(43		)
Common and preferred stock dividends paid	(378,858		)	(361,310		)
Net cash used in financing activities	(62,343		)	(431,813		)
Net (decrease) increase in unrestricted and restricted cash and cash equivalents	(59,669		)	113,500
Unrestricted and restricted cash and cash equivalents at beginning of period	151,395			61,126
Unrestricted and restricted cash and cash equivalents at end of period	$	91,726		$	174,626
Supplemental disclosure of cash flow information:
Cash paid for interest (net of $19.0 million and $13.3 million capitalized in 2019 and 2018, respectively)	$	145,001		$	146,039
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	5,097		$	—
Supplemental disclosure of noncash investing and financing activities:
Issuance of DownREIT limited partnership units in connection with acquisition of real estate	$	65,472		$	—
Transfers between real estate under development to rental properties, net	$	14,501		$	99,547
Transfer from real estate under development to co-investments	$	106		$	640
Reclassifications to redeemable noncontrolling interest from additional paid in capital and noncontrolling interest	$	3,675		$	2,253
Redemption of redeemable noncontrolling interest via reduction of note receivable	$	—		$	4,751
Initial recognition of operating lease right-of-use assets	$	77,645		$	—
Initial recognition of operating lease liabilities	$	79,693		$	—
Debt assumed in connection with acquisition	$	143,006		$	—
Repayment of mortgage note from new financing proceeds	$	—		$	52,000

See accompanying notes to the unaudited condensed consolidated financial statements.

9

ESSEX PORTFOLIO, L.P.  AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Unaudited)

(In thousands, except parenthetical and unit amounts)

ASSETS	September 30, 2019			December 31, 2018
Real estate:
Rental properties:
Land and land improvements	$	2,766,344		$	2,701,356
Buildings and improvements	11,180,806			10,664,745
	13,947,150			13,366,101
Less: accumulated depreciation	(3,567,632		)	(3,209,548		)
	10,379,518			10,156,553
Real estate under development	562,338			454,629
Co-investments	1,413,861			1,300,140
	12,355,717			11,911,322
Cash and cash equivalents-unrestricted	74,031			134,465
Cash and cash equivalents-restricted	17,695			16,930
Marketable securities	216,894			209,545
Notes and other receivables (includes related party receivables of $144.6 million and $11.1 million as of September 30, 2019 and December 31, 2018, respectively)	216,541			71,895
Operating lease right-of-use assets	75,478			—
Prepaid expenses and other assets	41,536			39,439
Total assets	$	12,997,892		$	12,383,596
LIABILITIES AND CAPITAL
Unsecured debt, net	$	4,686,171		$	3,799,316
Mortgage notes payable, net	1,141,970			1,806,626
Lines of credit	220,000			—
Accounts payable and accrued liabilities	193,341			127,086
Construction payable	53,214			59,345
Distributions payable	135,492			128,529
Operating lease liabilities	77,495			—
Other liabilities	36,128			33,375
Total liabilities	6,543,811			5,954,277
Commitments and contingencies
Redeemable noncontrolling interest	39,077			35,475
Capital:
General Partner:
Common equity (66,081,635 and 65,890,322 units issued and outstanding, respectively)	6,244,128			6,280,290
	6,244,128			6,280,290
Limited Partners:
Common equity (2,298,237 and 2,305,389 units issued and outstanding, respectively)	57,002			59,061
Accumulated other comprehensive loss	(15,752		)	(9,738		)
Total partners' capital	6,285,378			6,329,613
Noncontrolling interest	129,626			64,231
Total capital	6,415,004			6,393,844
Total liabilities and capital	$	12,997,892		$	12,383,596

See accompanying notes to the unaudited condensed consolidated financial statements.

10

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Condensed Consolidated Statements of Income and Comprehensive Income

(Unaudited)

(In thousands, except unit and per unit amounts)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Revenues:
Rental and other property	$	364,504		$	348,610		$	1,077,767		$	1,040,083
Management and other fees from affiliates	2,428			2,307			7,023			6,812
	366,932			350,917			1,084,790			1,046,895
Expenses:
Property operating, excluding real estate taxes	63,181			59,100			181,241			174,461
Real estate taxes	39,290			38,675			114,993			112,423
Corporate-level property management expenses	8,255			7,761			24,620			23,313
Depreciation and amortization	120,809			120,852			360,842			359,287
General and administrative	11,345			10,601			38,731			36,539
Expensed acquisition and investment related costs	13			31			69			156
	242,893			237,020			720,496			706,179
Gain on sale of real estate and land	—			—			—			22,244
Earnings from operations	124,039			113,897			364,294			362,960
Interest expense	(54,896		)	(55,196		)	(162,651		)	(166,335		)
Total return swap income	2,154			2,184			6,174			6,682
Interest and other income	8,685			8,437			29,293			21,241
Equity income from co-investments	21,700			16,788			54,935			64,611
Deferred tax expense on unrealized gain on unconsolidated co-investment	(1,457		)	—			(1,457		)	—
Gain on early retirement of debt, net	5,475			—			7,143			—
Gain on remeasurement of co-investment	—			—			31,535			—
Net income	105,700			86,110			329,266			289,159
Net income attributable to noncontrolling interest	(2,901		)	(2,346		)	(7,935		)	(7,445		)
Net income available to common unitholders	$	102,799		$	83,764		$	321,331		$	281,714
Comprehensive income	$	105,663		$	89,100		$	323,071		$	301,708
Comprehensive income attributable to noncontrolling interest	(2,901		)	(2,346		)	(7,935		)	(7,445		)
Comprehensive income attributable to controlling interest	$	102,762		$	86,754		$	315,136		$	294,263
Per unit data:
Basic:
Net income available to common unitholders	$	1.51		$	1.23		$	4.72		$	4.12
Weighted average number of common units outstanding during the period	68,148,913			68,325,091			68,058,802			68,321,153
Diluted:
Net income available to common unitholders	$	1.51		$	1.23		$	4.71		$	4.12
Weighted average number of common units outstanding during the period	68,271,474			68,376,795			68,158,548			68,366,167

See accompanying notes to the unaudited condensed consolidated financial statements.

11

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Condensed Consolidated Statements of Capital for the three and nine months ended September 30, 2019 and 2018

(Unaudited)

(In thousands)

	General Partner				Limited Partners					Accumulated other comprehensive loss
	Common Equity				Common Equity								Noncontrolling Interest
Three months ended September 30, 2019	Units	Amount			Units		Amount									Total
Balances at June 30, 2019	65,727	$	6,173,899		2,299		$	57,726		$	(15,715	)	$	129,206		$	6,345,116
Net income	—	99,335			—		3,464			—			2,901			105,700
Change in fair value of derivatives and amortization of swap settlements	—	—			—		—			(12		)	—			(12		)
Change in fair value of marketable debt securities, net	—	—			—		—			(25		)	—			(25		)
Issuance of common units under:
General partner's stock based compensation, net	126	27,679			—		—			—			—			27,679
Sale of common stock by general partner, net	228	72,631			—		—			—			—			72,631
Equity based compensation costs	—	1,544			—		270			—			—			1,814
Changes in redemption value of redeemable noncontrolling interest	—	(2,309		)	—		61			—			1			(2,247		)
Distributions to noncontrolling interest	—	—			—		—			—			(2,302		)	(2,302		)
Redemptions	1	211			(1	)	(32		)				(180		)	(1		)
Distributions declared ($1.95 per unit)	—	(128,862		)	—		(4,487		)	—			—			(133,349		)
Balances at September 30, 2019	66,082	$	6,244,128		2,298		$	57,002		$	(15,752	)	$	129,626		$	6,415,004

12

	General Partner					Limited Partners					Accumulated other comprehensive loss
	Common Equity					Common Equity								Noncontrolling Interest
Nine months ended September 30, 2019	Units		Amount			Units		Amount									Total
Balances at December 31, 2018	65,890		$	6,280,290		2,305		$	59,061		$	(9,738	)	$	64,231		$	6,393,844
Net income	—		310,468			—		10,863			—			7,935			329,266
Reversal of unrealized gains upon the sale of marketable debt securities	—		—			—		—			(32		)	—			(32		)
Change in fair value of derivatives and amortization of swap settlements	—		—			—		—			(6,366		)	—			(6,366		)
Change in fair value of marketable debt securities, net	—		—			—		—			203			—			203
Issuance of common units under:
General partner's stock based compensation, net	188		32,907			—		—			—			—			32,907
Sale of common stock by general partner, net	228		72,549			—		—			—			—			72,549
Equity based compensation costs	—		7,016			3		898			—			—			7,914
Retirement of common units, net	(234	)	(56,989		)	—		—			—			—			(56,989		)
Cumulative effect upon adoption of ASU No. 2017-12	—		—			—		—			181			—			181
Changes in redemption value of redeemable noncontrolling interest	—		(5,048		)	—		63			—			1,310			(3,675		)
Changes in noncontrolling interest from acquisition	—		—			—		—			—			65,472			65,472
Distributions to noncontrolling interest	—		—			—		—			—			(7,412		)	(7,412		)
Redemptions	10		(11,872		)	(10	)	(398		)	—			(1,910		)	(14,180		)
Distributions declared ($5.85 per unit)	—		(385,193		)	—		(13,485		)	—			—			(398,678		)
Balances at September 30, 2019	66,082		$	6,244,128		2,298		$	57,002		$	(15,752	)	$	129,626		$	6,415,004

13

	General Partner				Limited Partners				Accumulated other comprehensive loss
	Common Equity				Common Equity							Noncontrolling Interest
Three months ended September 30, 2018	Units	Amount			Units	Amount									Total
Balances at June 30, 2018	66,050	$	6,365,623		2,273	$	52,339		$	(7,898	)	$	64,619		$	6,474,683
Net income	—	80,975			—	2,789			—			2,346			86,110
Reversal of unrealized losses upon the sale of marketable debt securities	—	—			—	—			4			—			4
Change in fair value of derivatives and amortization of swap settlements	—	—			—	—			2,974			—			2,974
Change in fair value of marketable debt securities, net	—	—			—	—			12			—			12
Issuance of common units under:
General partner's stock based compensation, net	5	887			—	—			—			—			887
Sale of common stock by general partner, net	—	(130		)	—	—			—			—			(130		)
Equity based compensation costs	—	1,496			—	251			—			—			1,747
Changes in redemption value of redeemable noncontrolling interest	—	(386		)	—	(34		)	—			12			(408		)
Distributions to noncontrolling interest	—	—			—	—			—			(2,632		)	(2,632		)
Redemptions	—	(89		)	—	—			—			(11		)	(100		)
Distributions declared ($1.86 per unit)	—	(122,867		)	—	(4,252		)	—			—			(127,119		)
Balances at September 30, 2018	66,055	$	6,325,509		2,273	$	51,093		$	(4,908	)	$	64,334		$	6,436,028

14

	General Partner					Limited Partners				Accumulated other comprehensive loss
	Common Equity					Common Equity							Noncontrolling Interest
Nine months ended September 30, 2018	Units		Amount			Units	Amount									Total
Balances at December 31, 2017	66,054		$	6,295,852		2,268	$	49,792		$	(15,229	)	$	66,410		$	6,396,825
Net income	—		272,333			—	9,381			—			7,445			289,159
Reversal of unrealized losses upon the sale of marketable debt securities	—		—			—	—			6			—			6
Change in fair value of derivatives and amortization of swap settlements	—		—			—	—			12,630			—			12,630
Change in fair value of marketable debt securities, net	—		—			—	—			(87		)	—			(87		)
Issuance of common units under:
General partner's stock based compensation, net	17		2,751			—	—			—			—			2,751
Sale of common stock by general partner, net	—		(483		)	—	—			—			—			(483		)
Equity based compensation costs	—		7,697			5	864			—			—			8,561
Retirement of common units, net	(17	)	(3,774		)	—	—			—			—			(3,774		)
Cumulative effect upon adoption of ASU No. 2016-01	—		2,234			—	(6		)	(2,228		)	—			—
Cumulative effect upon adoption of ASU No. 2017-05	—		119,651			—	4,057			—			—			123,708
Changes in redemption value of redeemable noncontrolling interest	—		(2,032		)	—	(233		)	—			12			(2,253		)
Distributions to noncontrolling interest	—		—			—	—			—			(9,522		)	(9,522		)
Redemptions	1		(143		)	—	(3		)	—			(11		)	(157		)
Distributions declared ($5.58 per unit)	—		(368,577		)	—	(12,759		)	—			—			(381,336		)
Balances at September 30, 2018	66,055		$	6,325,509		2,273	$	51,093		$	(4,908	)	$	64,334		$	6,436,028

See accompanying notes to the unaudited condensed consolidated financial statements.

15

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands, except parenthetical amounts)

	Nine Months Ended September 30,
	2019			2018
Cash flows from operating activities:
Net income	$	329,266		$	289,159
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	360,842			359,287
Amortization of discount on marketable securities	(16,673		)	(12,949		)
Amortization of discount (premium) and debt financing costs, net	3,454			(1,958		)
Gain on sale of marketable securities	(737		)	(669		)
Unrealized (gain) loss on equity securities recognized through income	(4,280		)	(426		)
Company's share of gain on the sales of co-investment	(870		)	—
Earnings from co-investments	(54,065		)	(64,611		)
Operating distributions from co-investments	64,628			80,232
Accrued interest from notes and other receivables	(4,523		)	(4,016		)
Gain on the sale of real estate and land	—			(22,244		)
Equity-based compensation	6,748			7,209
Gain on early retirement of debt	(7,143		)	—
Gain on remeasurement of co-investment	(31,535		)	—
Changes in operating assets and liabilities:
Prepaid expenses, receivables, operating lease right-of-use assets, and other assets	(4,192		)	(4,044		)
Accounts payable, accrued liabilities, and operating lease liabilities	64,281			55,469
Other liabilities	1,726			698
Net cash provided by operating activities	706,927			681,137
Cash flows from investing activities:
Additions to real estate:
Acquisitions of real estate and acquisition related capital expenditures	(93,389		)	(7,807		)
Redevelopment	(55,027		)	(54,656		)
Development acquisitions of and additions to real estate under development	(130,593		)	(131,867		)
Capital expenditures on rental properties	(69,348		)	(54,890		)
Investments in notes receivable	(140,663		)	—
Collections of notes receivable	2,500			29,500
Proceeds from insurance for property losses	3,599			1,237
Proceeds from dispositions of real estate	—			130,730
Contributions to co-investments	(306,233		)	(100,202		)
Changes in refundable deposits	325			(3,804		)
Purchases of marketable securities	(42,653		)	(29,130		)
Sales and maturities of marketable securities	57,165			22,501
Non-operating distributions from co-investments	70,064			62,564
Net cash used in investing activities	(704,253		)	(135,824		)
Cash flows from financing activities:
Proceeds from unsecured debt and mortgage notes	892,762			298,773
Payments on unsecured debt and mortgage notes	(800,746		)	(162,317		)
Proceeds from lines of credit	1,485,034			454,170
Repayments of lines of credit	(1,265,034		)	(633,170		)
Retirement of common units	(56,989		)	(3,774		)
Additions to deferred charges	(9,446		)	(4,093		)
Net proceeds from issuance of common units	72,549			(483		)
Net proceeds from stock options exercised	36,422			2,751
Payments related to tax withholding for share-based compensation	(3,515		)	(23		)

16

	Nine Months Ended September 30,
	2019			2018
Distributions to noncontrolling interest	(5,978		)	(6,615		)
Redemption of noncontrolling interests	(14,180		)	(157		)
Redemption of redeemable noncontrolling interests	(73		)	(43		)
Common and preferred units and preferred interest distributions paid	(393,149		)	(376,832		)
Net cash used in financing activities	(62,343		)	(431,813		)
Net increase (decrease) in unrestricted and restricted cash and cash equivalents	(59,669		)	113,500
Unrestricted and restricted cash and cash equivalents at beginning of period	151,395			61,126
Unrestricted and restricted cash and cash equivalents at end of period	$	91,726		$	174,626
Supplemental disclosure of cash flow information:
Cash paid for interest (net of $19.0 million and $13.3 million capitalized in 2019 and 2018, respectively)	$	145,001		$	146,039
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	5,097		$	—
Supplemental disclosure of noncash investing and financing activities:
Issuance of DownREIT limited partnership units in connection with acquisition of real estate	$	65,472		$	—
Transfers between real estate under development to rental properties, net	$	14,501		$	99,547
Transfer from real estate under development to co-investments	$	106		$	640
Reclassifications to redeemable noncontrolling interest from general and limited partner capital and noncontrolling interest	$	3,675		$	2,253
Redemption of redeemable noncontrolling interest via reduction of note receivable	$	—		$	4,571
Initial recognition of operating lease right-of-use assets	$	77,645		$	—
Initial recognition of operating lease liabilities	$	79,693		$	—
Debt assumed in connection with acquisition	$	143,006		$	—
Repayment of mortgage note from new financing proceeds	$	—		$	52,000

See accompanying notes to the unaudited condensed consolidated financial statements.

17

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

(1) Organization and Basis of Presentation

The accompanying unaudited condensed consolidated financial statements present the accounts of Essex Property Trust, Inc. ("Essex" or the "Company"), which include the accounts of the Company and Essex Portfolio, L.P. and its subsidiaries (the "Operating Partnership," which holds the operating assets of the Company), prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and in accordance with the instructions to Form 10-Q. In the opinion of management, all adjustments necessary for a fair presentation of the financial position, results of operations, and cash flows for the periods presented have been included and are normal and recurring in nature. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Company's annual report on Form 10-K for the year ended December 31, 2018.

All significant intercompany accounts and transactions have been eliminated in the unaudited condensed consolidated financial statements. Certain reclassifications have been made to conform to the current year’s presentation.

The unaudited condensed consolidated financial statements for the three and nine months ended September 30, 2019 and 2018 include the accounts of the Company and the Operating Partnership. Essex is the sole general partner of the Operating Partnership, with a 96.6% general partnership interest as of both September 30, 2019 and December 31, 2018. Total Operating Partnership limited partnership units ("OP Units," and the holders of such OP Units, "Unitholders") outstanding were 2,298,237 and 2,305,389 as of September 30, 2019 and December 31, 2018, respectively, and the redemption value of the units, based on the closing price of the Company’s common stock totaled approximately $750.7 million and $565.3 million as of September 30, 2019 and December 31, 2018, respectively.

As of September 30, 2019, the Company owned or had ownership interests in 249 operating apartment communities, aggregating 60,620 apartment homes, excluding the Company’s ownership interest in preferred interest co-investments, loan investments, one operating commercial building, and seven active developments. The operating apartment communities are located in Southern California (primarily Los Angeles, Orange, San Diego, and Ventura counties), Northern California (the San Francisco Bay Area) and the Seattle metropolitan areas.

Accounting Pronouncements Adopted in the Current Year

In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02 (Topic 842) "Leases," which requires an entity that is a lessee to classify leases as either finance or operating and to recognize a lease liability and a right-of-use asset for all leases that have a duration of greater than 12 months. Leases of 12 months or less are to be accounted for similar to prior leasing guidance (Topic 840) for operating leases. For lessors, accounting for leases under the new standard is substantially the same as prior leasing guidance for sales-type leases, direct financing leases, and operating leases, but eliminates current real estate specific provisions and changes the treatment of initial direct costs. In July 2018, the FASB issued ASU No. 2018-11 "Leases (Topic 842): Targeted Improvements," which includes a practical expedient that allows lessors to not separate nonlease components from the associated lease component. This provides the Company with the option of not bifurcating certain common area maintenance recoveries as a non-lease component, if certain requirements are met. The Company adopted ASU No. 2016-02 and ASU No. 2018-11 as of January 1, 2019 using the modified retrospective approach and elected a package of practical expedients. There was no adjustment to the opening balance of retained earnings as a result of the adoption. See Note 11, Lease Agreements - Company as Lessor, and Note 12, Lease Agreements - Company as Lessee, for further details.

In August 2017, the FASB issued ASU No. 2017-12 "Derivatives and Hedging - Targeted Improvements to Accounting for Hedging Activities," which, among other things, requires entities to present the earnings effect of hedging instruments in the same income statement line item in which the earnings effect of the hedged item is reported. The new standard also adds new disclosure requirements. The Company adopted ASU No. 2017-12 as of January 1, 2019 using the modified retrospective method by applying a cumulative effect adjustment to accumulated other comprehensive loss, net of $0.2 million, representing accumulated net hedge ineffectiveness. Furthermore, as a result of the adoption of this standard, the Company will recognize qualifying hedge ineffectiveness through accumulated other comprehensive income as opposed to current earnings.

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ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

Recent Accounting Pronouncements

In June 2016, the FASB issued ASU No. 2016-13 "Measurement of Credit Losses on Financial Instruments," which amends the current approach to estimate credit losses on certain financial assets, including trade and other receivables, available-for-sale securities, and other financial instruments. Generally, this amendment requires entities to establish a valuation allowance for the expected lifetime losses of these certain financial assets. Subsequent changes in the valuation allowance are recorded in current earnings and reversal of previous losses are permitted. Currently, U.S. GAAP requires entities to write down credit losses only when losses are probable and loss reversals are not permitted. The FASB additionally issued various updates to clarify and amend the guidance provided in ASU 2016-13. In May 2019, the FASB issued ASU 2019-04, "Codification Improvements to Topic 326, Financial Instruments - Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments," which, with respect to credit losses, among other things, clarifies and addresses issues related to accrued interest, transfers between classifications of loans or debt securities, recoveries, and variable interest rates. Additionally, in May 2019, the FASB issued ASU 2019-05, "Financial Instruments - Credit Losses (Topic 326): Targeted Transition Relief," which allows entities to irrevocably elect the fair value option on certain financial instruments. The new standards will be effective for the Company beginning January 1, 2020 and early adoption is permitted. The Company is currently in the process of evaluating the impact of these amendments, with a focus on investments in mortgage backed securities and mezzanine loans, and does not expect the adoption to have a material impact on the Company's consolidated results of operations or financial position.

In August 2018, the FASB issued ASU No. 2018-13 "Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement," which eliminates certain disclosure requirements affecting all levels of measurements, and modifies and adds new disclosure requirements for Level 3 measurements. The new standard will be effective for the Company beginning January 1, 2020 and early adoption is permitted. The Company expects to apply the new standard on January 1, 2020 and does not expect the adoption to have a material impact on the Company's consolidated results of operations or financial position.

Marketable Securities

The Company reports its equity securities and available for sale debt securities at fair value, based on quoted market prices (Level 1 for the common stock and investment funds, Level 2 for the unsecured bonds and Level 3 for investments in mortgage backed securities, as defined by the FASB standard for fair value measurements). As of September 30, 2019 and December 31, 2018, $4.9 million and $6.7 million, respectively, of equity securities presented within common stock and stock funds in the tables below, represent investments measured at fair value, using net asset value as a practical expedient, and are not categorized in the fair value hierarchy.

Any unrealized gain or loss in debt securities classified as available for sale is recorded as other comprehensive income. Unrealized gains and losses in equity securities, realized gains and losses in debt securities, interest income, and amortization of purchase discounts are included in interest and other income on the condensed consolidated statements of income and comprehensive income.

As of September 30, 2019 and December 31, 2018, equity securities and debt securities consisted primarily of investment-grade unsecured bonds, U.S. treasury securities, common stock and stock funds, and investments in mortgage backed securities. As of September 30, 2019 and December 31, 2018, the Company classified its investments in mortgage backed securities, which mature in November 2019 and September 2020, as held to maturity, and accordingly, these securities are stated at their amortized cost. The discount on the mortgage backed securities is being amortized to interest income based on an estimated yield and the maturity date of the securities.

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ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

As of September 30, 2019 and December 31, 2018, marketable securities consist of the following ($ in thousands):

	September 30, 2019
	Amortized Cost/Cost		Gross Unrealized Gain (Loss)			Carrying Value
Equity securities:
Investment funds - debt securities	$	27,883	$	576		$	28,459
Common stock and stock funds	37,123		1,465			38,588
Debt securities:
Available for sale
U.S. treasury securities	4,915		(15		)	4,900
Investment-grade unsecured debt	1,048		10			1,058
Held to maturity
Mortgage backed securities	143,889		—			143,889
Total - Marketable securities	$	214,858	$	2,036		$	216,894

	December 31, 2018
	Amortized Cost/Cost		Gross Unrealized Gain (Loss)			Carrying Value
Equity securities:
Investment funds - debt securities	$	31,934	$	(568	)	$	31,366
Common stock and stock funds	39,731		(1,671		)	38,060
Debt securities:
Available for sale
U.S. treasury securities	8,983		(31		)	8,952
Investment-grade unsecured bonds	4,125		(145		)	3,980
Held to maturity
Mortgage backed securities	127,187		—			127,187
Total - Marketable securities	$	211,960	$	(2,415	)	$	209,545

The Company uses the specific identification method to determine the cost basis of a debt security sold and to reclassify amounts from accumulated other comprehensive income for such securities. 

For the three months ended September 30, 2019 and 2018, the proceeds from sales and maturities of marketable securities totaled $7.0 million and $3.5 million, respectively, which resulted in $0.2 million and $0.1 million in realized gains, respectively, for such periods. For the nine months ended September 30, 2019 and 2018, the proceeds from sales and maturities of marketable securities totaled $57.2 million and $22.5 million, respectively, which resulted in $0.7 million in realized gains for both periods.

For the three and nine months ended September 30, 2019, the portion of equity security unrealized losses or gains that were recognized in income totaled $0.2 million in losses and $4.3 million in gains, respectively, and were included in interest and other income on the Company's condensed consolidated statements of income and comprehensive income. For the three and nine months ended September 30, 2018, the portion of equity security unrealized gains that was recognized in income totaled

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ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

$1.2 million and $0.4 million, respectively, and was included in interest and other income on the Company's condensed consolidated statements of income and comprehensive income.

Variable Interest Entities

In accordance with accounting standards for consolidation of variable interest entities ("VIEs"), the Company consolidates the Operating Partnership, 17 DownREIT limited partnerships (comprising nine communities), and seven co-investments as of September 30, 2019. As of December 31, 2018, the Company consolidated the Operating Partnership, 16 DownREIT limited partnerships (comprising eight communities), and eight co-investments. The Company consolidates these entities because it is deemed the primary beneficiary. Essex has no assets or liabilities other than its investment in the Operating Partnership. The consolidated total assets and liabilities related to the above consolidated co-investments and DownREIT limited partnerships, net of intercompany eliminations, were approximately $1.0 billion and $372.0 million, respectively, as of September 30, 2019 and $849.8 million and $261.7 million, respectively, as of December 31, 2018. Noncontrolling interests in these entities were $129.9 million and $64.5 million as of September 30, 2019 and December 31, 2018, respectively. The Company's financial risk in each VIE is limited to its equity investment in the VIE. As of September 30, 2019 and December 31, 2018, the Company did not have any VIEs of which it was not deemed to be the primary beneficiary.

Equity-based Compensation

The cost of share- and unit-based compensation awards is measured at the grant date based on the estimated fair value of the awards. The estimated fair value of stock options and restricted stock granted by the Company are being amortized over the vesting period. The estimated grant date fair values of the long term incentive plan units (discussed in Note 13, "Equity Based Compensation Plans," in the Company’s annual report on Form 10-K for the year ended December 31, 2018) are being amortized over the expected service periods.

Fair Value of Financial Instruments

Management believes that the carrying amounts of the outstanding balances under its lines of credit, and notes and other receivables approximate fair value as of September 30, 2019 and December 31, 2018, because interest rates, yields, and other terms for these instruments are consistent with interest rates, yields, and other terms currently available for similar instruments. Management has estimated that the fair value of the Company’s fixed rate debt with a carrying value of $5.2 billion and $5.0 billion at September 30, 2019 and December 31, 2018, respectively, was approximately $5.5 billion and $5.0 billion, respectively. Management has estimated that the fair value of the Company’s $839.2 million and $619.6 million of variable rate debt at September 30, 2019 and December 31, 2018, respectively, was approximately $833.6 million and $615.2 million based on the terms of existing mortgage notes payable, unsecured debt, and variable rate demand notes compared to those available in the marketplace. Management believes that the carrying amounts of cash and cash equivalents, restricted cash, accounts payable and accrued liabilities, construction payables, other liabilities, and dividends payable approximate fair value as of September 30, 2019 and December 31, 2018 due to the short-term maturity of these instruments. Marketable securities, except mortgage backed securities, are carried at fair value as of September 30, 2019 and December 31, 2018.

At September 30, 2019, the Company’s investments in mortgage backed securities had a carrying value of $143.9 million and the Company estimated the fair value to be approximately $144.7 million. At December 31, 2018, the Company’s investments in mortgage backed securities had a carrying value of $127.2 million and the Company estimated the fair value to be approximately $129.5 million. The Company determines the fair value of the mortgage backed securities based on unobservable inputs (level 3 of the fair value hierarchy) considering the assumptions that market participants would make in valuing these securities. Assumptions such as estimated default rates and discount rates are used to determine the expected, discounted cash flows to estimate fair value.

Capitalization of Costs

The Company’s capitalized internal costs related to development and redevelopment projects were comprised primarily of employee compensation and totaled $4.3 million and $4.7 million during the three months ended September 30, 2019 and 2018, respectively, and $13.1 million and $14.2 million for the nine months ended September 30, 2019 and 2018, respectively. The Company capitalizes leasing commissions associated with the lease-up of development communities and amortizes the costs over the life of the leases. The amounts capitalized for leasing commissions are immaterial for all periods presented.

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ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

Co-investments

The Company owns investments in joint ventures in which it has significant influence, but its ownership interest does not meet the criteria for consolidation in accordance with U.S. GAAP. Therefore, the Company accounts for co-investments using the equity method of accounting. Under the equity method of accounting, the investment is carried at the cost of assets contributed, plus the Company's equity in earnings less distributions received and the Company's share of losses. The significant accounting policies of the Company’s co-investment entities are consistent with those of the Company in all material respects.

Upon the acquisition of a controlling interest of a co-investment, the co-investment entity is consolidated and a gain or loss is recognized upon the remeasurement of co-investments in the consolidated statement of income equal to the amount by which the fair value of the co-investment interest the Company previously owned exceeds its carrying value. A majority of the co-investments, excluding the preferred equity investments, compensate the Company for its asset management services and some of these investments may provide promote income if certain financial return benchmarks are achieved. Asset management fees are recognized when earned, and promote fees are recognized when the earnings events have occurred and the amount is determinable and collectible. Any promote fees are reflected in equity income from co-investments.

The Company reports investments in co-investments where accumulated distributions have exceeded the Company’s investment as distributions in excess of investments in co-investments in the accompanying condensed consolidated balance sheets. 

Changes in Accumulated Other Comprehensive Loss, Net by Component

Essex Property Trust, Inc.

($ in thousands):

	Change in fair value and amortization of swap settlements			Unrealized gains/(losses) on available for sale securities			Total
Balance at December 31, 2018	$	(13,077	)	$	(140	)	$	(13,217	)
Cumulative effect upon adoption of ASU No. 2017-12	175			—			175
Other comprehensive (loss) income before reclassification	(490		)	197			(293		)
Amounts reclassified from accumulated other comprehensive loss	(5,662		)	(31		)	(5,693		)
Other comprehensive income	(5,977		)	166			(5,811		)
Balance at September 30, 2019	$	(19,054	)	$	26		$	(19,028	)

Changes in Accumulated Other Comprehensive Loss, by Component

Essex Portfolio, L.P.

($ in thousands):

	Change in fair value and amortization of swap settlements			Unrealized gains/(losses) on available for sale securities			Total
Balance at December 31, 2018	$	(9,593	)	$	(145	)	$	(9,738	)
Cumulative effect upon adoption of ASU No. 2017-12	181			—			181
Other comprehensive income (loss) before reclassification	(506		)	203			(303		)
Amounts reclassified from accumulated other comprehensive loss	(5,860		)	(32		)	(5,892		)
Other comprehensive income	(6,185		)	171			(6,014		)
Balance at September 30, 2019	$	(15,778	)	$	26		$	(15,752	)

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ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

Amounts reclassified from accumulated other comprehensive loss in connection with derivatives are recorded in interest expense on the condensed consolidated statements of income and comprehensive income. Realized gains and losses on available for sale debt securities are included in interest and other income on the condensed consolidated statements of income and comprehensive income.

Redeemable Noncontrolling Interest

The carrying value of redeemable noncontrolling interest in the accompanying condensed consolidated balance sheets was $39.1 million and $35.5 million as of September 30, 2019 and December 31, 2018, respectively. The limited partners may redeem their noncontrolling interests for cash in certain circumstances.

The changes to the redemption value of redeemable noncontrolling interests for the nine months ended September 30, 2019 is as follows ($ in thousands):

Balance at December 31, 2018	$	35,475
Reclassification due to change in redemption value and other	3,675
Redemptions	(73		)
Balance at September 30, 2019	$	39,077

Cash, Cash Equivalents and Restricted Cash

Highly liquid investments with original maturities of three months or less when purchased are classified as cash equivalents. Restricted cash balances relate primarily to reserve requirements for capital replacement at certain communities in connection with the Company’s mortgage debt.

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the condensed consolidated statements of cash flows ($ in thousands):

	September 30, 2019		December 31, 2018		September 30, 2018		December 31, 2017
Cash and cash equivalents - unrestricted	$	74,031	$	134,465	$	157,279	$	44,620
Cash and cash equivalents - restricted	17,695		16,930		17,347		16,506
Total unrestricted and restricted cash and cash equivalents shown in the condensed consolidated statement of cash flows	$	91,726	$	151,395	$	174,626	$	61,126

Accounting Estimates

The preparation of condensed consolidated financial statements, in accordance with U.S. GAAP, requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. On an on-going basis, the Company evaluates its estimates, including those related to acquiring, developing and assessing the carrying values of its real estate portfolio, its investments in and advances to joint ventures and affiliates, its notes receivables, and its qualification as a real estate investment trust ("REIT"). The Company bases its estimates on historical experience, current market conditions, and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may vary from those estimates and those estimates could be different under different assumptions or conditions.

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ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

(2)  Significant Transactions During The Nine Months Ended September 30, 2019 and Subsequent Events

Significant Transactions

Acquisitions

In March 2019, the Company acquired its joint venture partner’s 45.0% membership interest in One South Market, a multifamily community located in San Jose, CA, for total consideration of $80.6 million. Concurrent with the closing of the acquisition, $86.0 million in mortgage debt was repaid. As a result of this acquisition, the Company realized a gain on remeasurement of co-investment of $31.5 million upon consolidation. Furthermore, the Company recognized $0.8 million in promote income as a result of the transaction, which is included in equity income from co-investments on the condensed consolidated statements of income and comprehensive income.

In June 2019, the Company acquired Brio, a 300 unit apartment home community located in Walnut Creek, CA. The Company issued DownREIT limited partnership units to an affiliate of Marcus & Millichap Company, based on a contract price of $164.9 million. The property was encumbered by $98.7 million of mortgage debt which was assumed by the Company at the time of acquisition. As a result of this transaction, the Company consolidated the property, based on a VIE analysis performed by the Company. See Note 6, Related Party Transactions, for additional details.

In August 2019, Wesco V, LLC ("Wesco V"), one of the Company's joint ventures, acquired The Courtyards at 65th Street, a 331 unit apartment home community located in Emeryville, CA, for a total contract price of $178.0 million. The property was encumbered by an $89.0 million related party bridge loan from the Company, with an interest rate of LIBOR plus 1.30% and a maturity date of December 2019. See Note 6, Related Party Transactions, for additional details.

In August 2019, BEX IV, LLC ("BEX IV"), one of the Company's joint ventures, acquired 777 Hamilton, a 195 unit apartment home community located in Menlo Park, CA, for a total contract price of $148.0 million. The property is encumbered by a $44.4 million related party bridge loan from the Company, with an interest rate of 3.25% and a maturity date of November 2019. See "Co-investments" section below for further details related to the creation of BEX IV. See Note 6, Related Party Transactions, for additional details.

In September 2019, the Company acquired Township, a 132 unit apartment home community in Redwood City, CA, for a total contract price of $88.7 million. The property was encumbered by $44.3 million of mortgage debt, which was assumed by the Company at the time of acquisition.

Dispositions

In May 2019, the Company sold its 50.0% ownership interest in a co-investment that held land located in Oakland, CA for $6.1 million, resulting in a gain of $0.9 million within equity income from co-investments.

Co-Investments

Joint Ventures

In August 2019, the Company formed a new joint venture entity, BEX IV, with an institutional partner. The Company has a 50.1% ownership interest in the joint venture and an initial equity commitment of $52.2 million. The joint venture is unconsolidated for financial reporting purposes.

Preferred Equity Investments

In February 2019, the Company funded a $24.5 million related party preferred equity investment in a multifamily development community located in Mountain View, CA. The investment has an initial preferred return of 11.0% and is scheduled to mature in February 2024. See Note 6, Related Party Transactions, for additional details.

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ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

In February 2019, the Company received cash of $10.9 million, including an early redemption fee of $0.1 million, for the full redemption of a related party preferred equity investment in a joint venture that holds property in San Jose, CA. See Note 6, Related Party Transactions, for additional details.

In March 2019, the Company made a commitment to fund a $36.0 million preferred equity commitment in a multifamily development community located in Irvine, CA. The investment has an initial preferred return of 10.15% and is scheduled to mature in July 2022. As of September 30, 2019, the Company had funded $21.6 million of this commitment. The remaining committed amount is expected to be funded by the end of the year.

In April 2019, the Company received cash of $16.3 million, including an early redemption fee of $0.7 million, for the full redemption of a preferred equity investment in a joint venture that holds property in Santa Ana, CA.

In April 2019, the Company made a commitment to fund a $36.8 million preferred equity investment in a multifamily development community located in Oakland, CA. The investment has an initial preferred return of 10.25% and is scheduled to mature in April 2023. As of September 30, 2019, the Company had funded $15.0 million of this commitment. The remaining committed amount is expected to be funded by the end of the year.

In April 2019, the Company made a commitment to fund a $11.8 million preferred equity investment in a multifamily development community located in Oakland, CA. The investment has an initial preferred return of 11.0% and is scheduled to mature in April 2023. As of September 30, 2019, the Company had funded $5.5 million of this commitment. The remaining committed amount is expected to be funded by the end of the year.

In September 2019, the Company received cash of $14.8 million, including an early redemption fee of $0.3 million, for the full redemption of a preferred equity investment in a property located in Redmond, WA.

In September 2019, the Company received cash of $16.3 million, including an early redemption fee of $1.4 million, for the full redemption of a preferred equity investment in a property located in Seattle, WA.

Common Stock

In January 2019, the Company repurchased and retired 234,061 shares totaling $57.0 million, including commissions. In February 2019, the board of directors approved the replenishment of the stock repurchase plan such that, as of such date, the Company had $250.0 million of purchase authority remaining under the replenished plan. As of September 30, 2019, the Company had $250.0 million of purchase authority remaining under the stock repurchase plan.

During the nine months ended September 30, 2019, the Company issued 228,271 shares of common stock through its equity distribution program at an average price of $321.56 per share for proceeds of $73.4 million. There were no such sales during the nine months ended September 30, 2018.

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ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

Senior Unsecured Debt

In February 2019, the Operating Partnership issued $350.0 million of senior unsecured notes due on March 1, 2029, with a coupon rate of 4.000% (the "2029 Notes"), which are payable on March 1 and September 1 of each year, beginning on September 1, 2019. The 2029 Notes were offered to investors at a price of 99.188% of the principal amount thereof. The 2029 Notes are general unsecured senior obligations of the Operating Partnership, rank equally in right of payment with all other senior unsecured indebtedness of the Operating Partnership and are unconditionally guaranteed by the Company. In March 2019, the Operating Partnership issued an additional $150.0 million of the 2029 Notes at a price of 100.717% of the principal amount thereof. These additional notes have substantially identical terms as the 2029 Notes issued in February 2019. The Company used the net proceeds of these offerings to repay indebtedness under its unsecured lines of credit and for other general corporate and working capital purposes.

In August 2019, the Operating Partnership issued $400.0 million of senior unsecured notes due on January 15, 2030, with a coupon rate of 3.000% (the "2030 Notes"), which are payable on January 15 and July 15 of each year, beginning on January 15, 2020. The 2030 Notes were offered to investors at a price of 98.632% of the principal amount thereof. The 2030 Notes are general unsecured senior obligations of the Operating Partnership, rank equally in right of payment with all other senior unsecured indebtedness of the Operating Partnership and are unconditionally guaranteed by the Company. The Company used the net proceeds of this offering to prepay, with no prepayment penalties, certain secured indebtedness under outstanding mortgage notes, to repay indebtedness under its unsecured lines of credit and for other general corporate and working capital purposes.

Mortgage Notes Payable

In January 2019, the Company repaid $290.0 million in secured mortgage notes payable with a coupon rate of 5.57% and a stated maturity date of May 2019. The Company realized a gain on early extinguishment of debt of $1.4 million.

In September 2019, the Company repaid $289.1 million in secured mortgage notes payable with a coupon rate of 5.69% and a stated maturity date of September 2020. The Company realized a gain on early extinguishment of debt of $5.5 million.

Subsequent Events

In October 2019, the Operating Partnership issued an additional $150.0 million of the 2030 Notes at a price of 101.685% of the principal amount thereof. The notes were issued as additional notes under the 2030 Notes indenture and have substantially identical terms as the 2030 Notes issued in August 2019.

In October 2019, the Company received cash of $15.8 million, including an early redemption fee of $0.2 million, for the full redemption of a preferred equity investment in a property located in San Jose, CA.

(3)  Revenues

Disaggregated Revenue

The following table presents the Company’s revenues disaggregated by revenue source ($ in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Rental income (1)	$	358,001	$	342,246	$	1,058,973	$	1,021,742
Other property (1)	6,503		6,364		18,794		18,341
Management and other fees from affiliates	2,428		2,307		7,023		6,812
Total revenues	$	366,932	$	350,917	$	1,084,790	$	1,046,895

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ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

(1) On January 1, 2019, the Company adopted ASU No. 2016-02 “Leases.” As a result of this adoption certain amounts previously classified as other property revenue have been reclassified to rental income. Prior period amounts have been adjusted to conform to the current period’s presentation.

The following table presents the Company’s rental and other property-related revenues disaggregated by geographic operating segment ($ in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Southern California	$	152,312	$	148,575	455,302		442,382
Northern California	144,124		131,538		420,544		389,750
Seattle Metro	61,657		59,231		182,738		176,740
Other real estate assets (1)	6,411		9,266		19,183		31,211
Total rental and other property revenues	$	364,504	$	348,610	$	1,077,767	$	1,040,083

(1) Other real estate assets consists of revenues generated from retail space, commercial properties, held for sale properties, and disposition properties.

The following table presents the Company’s rental and other property-related revenues disaggregated by current property category status ($ in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Same-property (1)	$	342,115	$	331,695	$	1,019,509	$	987,564
Acquisitions (2)	7,309		—		14,416		—
Development (3)	1,859		1,091		4,184		1,560
Redevelopment	5,255		5,125		15,690		15,185
Non-residential/other, net (4)	7,966		10,699		23,968		35,774
Total rental and other property revenues	$	364,504	$	348,610	$	1,077,767	$	1,040,083

(1) Properties that have stabilized operations as of January 1, 2018 and are consolidated by the Company for the three and nine months ended September 30, 2019 and 2018. A community is generally considered to have reached stabilized operations once it achieves an initial occupancy of 95%.

(2) Acquisitions includes properties acquired which did not have comparable stabilized results as of January 1, 2018.

(3) Development includes properties developed which did not have stabilized results as of January 1, 2018.

(4) Non-residential/other, net consists of revenues generated from retail space, commercial properties, held for sale properties, disposition properties and student housing.

Deferred Revenues and Remaining Performance Obligations

When cash payments are received or due in advance of the Company’s performance of contracts with customers, deferred revenue is recorded. The total deferred revenue balance related to such contracts was $4.1 million and $6.2 million as of September 30, 2019 and December 31, 2018, respectively, and was included in accounts payable and accrued liabilities within the accompanying condensed consolidated balance sheets. The amount of revenue recognized for the nine months ended September 30, 2019 that was included in the December 31, 2018 deferred revenue balance was $2.1 million, which was included in interest and other income within the condensed consolidated statements of income and comprehensive income.

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in the revenue recognition accounting standard. As of September 30, 2019, the Company had $4.1 million of remaining

27

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

performance obligations. The Company expects to recognize approximately 5% of these remaining performance obligations in 2019, an additional 36% through 2021, and the remaining balance thereafter.

(4) Co-investments

The Company has joint ventures and preferred equity investments in co-investments which are accounted for under the equity method. The co-investments, including BEXAEW, BEX II, BEX III, and BEX IV, the Canadian Pension Plan Investment Board ("CPPIB"), Wesco I, LLC ("Wesco I"), Wesco III, LLC ("Wesco III"), Wesco IV, LLC ("Wesco IV"), and Wesco V, LLC ("Wesco V"), own, operate, and develop apartment communities. The carrying values of the Company's co-investments as of September 30, 2019 and December 31, 2018 are as follows ($ in thousands, except parenthetical amounts):

	Weighted Average Company Ownership Percentage (1)		September 30, 2019		December 31, 2018
Ownership interest in:
CPPIB	54	%	$	469,288	$	482,507
Wesco I, Wesco III, Wesco IV, and Wesco V	52	%	212,808		194,890
BEXAEW, BEX II, BEX III, and BEX IV	50	%	161,467		121,780
Other	48	%	20,281		34,093
Total operating and other co-investments, net			863,844		833,270
Total pre-development and development co-investments	50	%	137,626		94,060
Total preferred interest co-investments (includes related party investments of $70.9 million and $51.8 million as of September 30, 2019 and December 31, 2018, respectively)			412,391		372,810
Total co-investments, net			$	1,413,861	$	1,300,140

(1) Weighted average Company ownership percentages are as of September 30, 2019.

The combined summarized entity financial information of co-investments is as follows ($ in thousands):

	September 30, 2019		December 31, 2018
Combined balance sheets: (1)
Rental properties and real estate under development	$	4,779,685	$	4,367,987
Other assets	110,364		104,119
Total assets	$	4,890,049	$	4,472,106
Debt	$	2,316,618	$	2,190,764
Other liabilities	146,643		106,316
Equity	2,426,788		2,175,026
Total liabilities and equity	$	4,890,049	$	4,472,106
Company's share of equity	$	1,413,861	$	1,300,140

28

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Combined statements of income: (1)
Property revenues	$	84,071		$	84,820		$	249,628		$	247,010
Property operating expenses	(29,214		)	(27,779		)	(85,768		)	(81,415		)
Net operating income	54,857			57,041			163,860			165,595
Interest expense	(16,089		)	(15,805		)	(47,284		)	(46,179		)
General and administrative	(2,603		)	(1,254		)	(6,774		)	(5,134		)
Depreciation and amortization	(30,411		)	(32,833		)	(89,283		)	(95,312		)
Net income	$	5,754		$	7,149		$	20,519		$	18,970
Company's share of net income (2)	$	21,700		$	16,788		$	54,935		$	64,611

(1) Includes preferred equity investments held by the Company.

(2) Includes the Company's share of equity income from joint ventures and preferred equity investments, gain on sales of co-investments, co-investment promote income and income from early redemption of preferred equity investments. Includes related party income of $2.0 million and $0.7 million for the three months ended September 30, 2019 and 2018, respectively, and $5.5 million and $1.4 million for the nine months ended September 30, 2019 and 2018, respectively.

(5) Notes and Other Receivables

Notes and other receivables consist of the following as of September 30, 2019 and December 31, 2018 ($ in thousands):

	September 30, 2019		December 31, 2018
Notes receivable, secured, bearing interest at 10.00%, due May 2021	$	16,418	$	15,226
Notes receivable, secured, bearing interest at 10.75%, due September 2020	35,384		32,650
Notes receivable, secured, bearing interest at 9.90%, due November 2021	7,324		—
Related party note receivable, secured, bearing interest at 9.50%, due October 2019(1)	6,618		6,618
Related party note receivable, bearing variable rate interest, due December 2019(1)	89,221		—
Related party note receivable, bearing interest at 3.25%, due November 2019(1)	44,462		—
Notes and other receivables from affiliates (2)	4,311		4,457
Other receivables	12,803		12,944
Total notes and other receivables	$	216,541	$	71,895

(1) See Note 6, Related Party Transactions, for additional details.

(2) These amounts consist of short-term loans outstanding and due from various joint ventures as of September 30, 2019 and December 31, 2018, respectively. See Note 6, Related Party Transactions, for additional details.

(6) Related Party Transactions

The Company charges certain fees relating to its co-investments for asset management, property management, development and redevelopment services. These fees from affiliates totaled $3.7 million and $3.6 million during the three months ended September 30, 2019 and 2018, respectively, and $10.6 million and $10.0 million during the nine months ended September 30, 2019 and 2018, respectively. All of these fees are net of intercompany amounts eliminated by the Company. The Company netted development and redevelopment fees of $1.2 million and $1.3 million against general and administrative expenses for the three months ended September 30, 2019 and 2018, respectively, and $3.6 million and $3.2 million for the nine months ended September 30, 2019 and 2018, respectively.

The Company’s Chairman and founder, Mr. George M. Marcus, is the Chairman of the Marcus & Millichap Company ("MMC"), which is a parent company of a diversified group of real estate service, investment, and development firms. Mr.

29

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

Marcus is also the Co-Chairman of Marcus & Millichap, Inc. ("MMI"), and Mr. Marcus owns a controlling interest in MMI, a national brokerage firm listed on the New York Stock Exchange. 

In August 2019, the Company provided an $89.0 million related party bridge loan to a property acquired by Wesco V. The note receivable accrues interest at LIBOR plus 1.30% and is scheduled to mature in December 2019. The bridge loan is classified within notes and other receivables in the accompanying condensed consolidated balance sheets and had an outstanding balance of $89.2 million as of September 30, 2019.

In August 2019, the Company provided a $44.4 million related party bridge loan to a property acquired by BEX IV. The note receivable accrues interest at 3.25% and is scheduled to mature in November 2019. The bridge loan is classified within notes and other receivables in the accompanying condensed consolidated balance sheets and had an outstanding balance of $44.5 million as of September 30, 2019.

In June 2019, the Company acquired Brio, a 300 unit apartment home community located in Walnut Creek, CA. The Company issued DownREIT limited partnership units to an affiliate of MMC, based on a contract price of $164.9 million. The property was encumbered by $98.7 million of mortgage debt which was assumed by the Company at the time of acquisition. As a result of this transaction, the Company consolidated the property, based on a VIE analysis performed by the Company.

In February 2019, the Company funded a $24.5 million preferred equity investment in an entity whose sponsor is an affiliate of MMC, which owns a multifamily development community located in Mountain View, CA. The investment has an initial preferred return of 11.0% and is scheduled to mature in February 2024.

In October 2018, the Company funded a $18.6 million preferred equity investment in an entity whose sponsor is an affiliate of MMC. The entity wholly owns a 268 apartment home community development located in Burlingame, CA. This investment will accrue interest based on an initial 12.00% preferred return. The investment is scheduled to mature in April 2024.

In May 2018, the Company made a commitment to fund a $26.5 million preferred equity investment in an entity whose sponsors include an affiliate of MMC. The entity wholly owns a 400 apartment home community located in Ventura, CA. This investment will accrue interest based on a 10.25% preferred return. The investment is scheduled to mature in May 2023. As of September 30, 2019, the Company had funded $21.9 million of the commitment. The remaining committed amount will be funded when requested by the sponsors.

In November 2017, the Company provided a $29.5 million related party bridge loan to a property acquired by BEX III. The note receivable accrued interest at 3.5% and was paid off in January 2018.

In March 2017, the Company converted its existing $15.3 million preferred equity investment in Sage at Cupertino, a 230 apartment home community located in San Jose, CA, into a 40.5% common equity ownership interest in the property. The Company issued DownREIT limited partnership units to the other members, including an MMC affiliate, based on an estimated property valuation of $90.0 million. At the time of the conversion, the property was encumbered by $52.0 million of mortgage debt. As a result of this transaction, the Company consolidates the property, based on a VIE analysis performed by the Company.

In 2015, the Company made preferred equity investments totaling $20.0 million in three entities affiliated with MMC that own apartment communities in California. The Company earned a 9.5% preferred return on each such investment. One $5.0 million investment, which was scheduled to mature in 2022, was fully redeemed in 2017. Another $5.0 million investment, which was scheduled to mature in 2022, was fully redeemed in 2018. The remaining investment was fully redeemed in February 2019.

As described in Note 5, Notes and Other Receivables, the Company has provided short-term loans to affiliates. As of September 30, 2019 and December 31, 2018, $4.3 million and $4.5 million, respectively, of short-term loans remained outstanding due from joint venture affiliates and is classified within notes and other receivables in the accompanying condensed consolidated balance sheets. In November 2016, the Company provided a $6.6 million mezzanine loan to a limited liability company in which MMC holds a significant ownership interest through subsidiaries. The mezzanine loan is classified within notes and other receivables in the accompanying condensed consolidated balance sheets and had an outstanding balance of $6.6 million as of both September 30, 2019 and December 31, 2018, respectively.

30

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

(7) Debt

The Company does not have indebtedness as debt is incurred by the Operating Partnership. The Company guarantees the Operating Partnership’s unsecured debt including the revolving credit facilities for the full term of the facilities.

Debt consists of the following ($ in thousands):

	September 30, 2019			December 31, 2018			Weighted Average Maturity In Years as of September 30, 2019
Unsecured bonds private placement - fixed rate	$	274,772		$	274,624		1.3
Term loan - variable rate	349,088			348,813			2.4
Bonds public offering - fixed rate	4,062,311			3,175,879			7.6
Unsecured debt, net (1)	4,686,171			3,799,316
Lines of credit (2)	220,000			—
Mortgage notes payable, net (3)	1,141,970			1,806,626			6.8
Total debt, net	$	6,048,141		$	5,605,942
Weighted average interest rate on fixed rate unsecured bonds private placement and bonds public offering	3.8		%	3.9		%
Weighted average interest rate on variable rate term loan	2.9		%	3.0		%
Weighted average interest rate on lines of credit	2.8		%	3.2		%
Weighted average interest rate on mortgage notes payable	4.3		%	4.3		%

(1) Includes unamortized discount of $14.7 million and $7.1 million and unamortized debt issuance costs of $24.1 million and $18.5 million, as of September 30, 2019 and December 31, 2018, respectively.

(2) Lines of credit, related to the Company's two lines of unsecured credit aggregating $1.24 billion as of September 30, 2019, excludes unamortized debt issuance costs of $4.1 million and $3.9 million as of September 30, 2019 and December 31, 2018, respectively. These debt issuance costs are included in prepaid expenses and other assets on the condensed consolidated balance sheets. As of September 30, 2019, the Company’s $1.2 billion credit facility had an interest rate of LIBOR plus 0.825%, which is based on a tiered rate structure tied to the Company’s credit ratings and a scheduled maturity date of December 2022 with one 18-month extension, exercisable at the Company’s option. As of September 30, 2019, the Company’s $35.0 million working capital unsecured line of credit had an interest rate of LIBOR plus 0.825%, which is based on a tiered rate structure tied to the Company’s credit ratings and a scheduled maturity date of February 2021.

(3) Includes total unamortized premium of $6.7 million and $14.9 million, reduced by unamortized debt issuance costs of $2.9 million and $4.2 million, as of September 30, 2019 and December 31, 2018, respectively.

The aggregate scheduled principal payments of the Company’s outstanding debt as of September 30, 2019 are as follows (excluding lines of credit) ($ in thousands):

Remaining in 2019	$	78,379
2020	408,064
2021	545,537
2022	693,188
2023	602,945
Thereafter	3,535,092
Total	$	5,863,205

31

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

(8) 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. The Company's chief operating decision makers are comprised of several members of its executive management team who use net operating income ("NOI") to assess the performance of the business for the Company's reportable operating segments. NOI represents total property revenues less direct property operating expenses.

The executive management team generally 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 NOI are management and other fees from affiliates and interest and other income. Non-segment revenues and NOI included in the following schedule also consist of revenues generated from commercial properties and properties that have been sold. Other non-segment assets include items such as 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 NOI for each of the reportable operating segments are summarized as follows for the three and nine months ended September 30, 2019 and 2018 ($ in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Revenues:
Southern California	$	152,312		$	148,575		$	455,302		$	442,382
Northern California	144,124			131,538			420,544			389,750
Seattle Metro	61,657			59,231			182,738			176,740
Other real estate assets	6,411			9,266			19,183			31,211
Total property revenues	$	364,504		$	348,610		$	1,077,767		$	1,040,083
Net operating income:
Southern California	$	106,951		$	104,732		$	323,073		$	314,977
Northern California	105,381			97,244			310,407			288,222
Seattle Metro	43,701			40,999			129,013			123,432
Other real estate assets	6,000			7,860			19,040			26,568
Total net operating income	262,033			250,835			781,533			753,199
Management and other fees from affiliates	2,428			2,307			7,023			6,812
Corporate-level property management expenses	(8,255		)	(7,761		)	(24,620		)	(23,313		)
Depreciation and amortization	(120,809		)	(120,852		)	(360,842		)	(359,287		)
General and administrative	(11,345		)	(10,601		)	(38,731		)	(36,539		)
Expensed acquisition and investment related costs	(13		)	(31		)	(69		)	(156		)
Gain on sale of real estate and land	—			—			—			22,244
Interest expense	(54,896		)	(55,196		)	(162,651		)	(166,335		)
Total return swap income	2,154			2,184			6,174			6,682
Interest and other income	8,685			8,437			29,293			21,241
Equity income from co-investments	21,700			16,788			54,935			64,611
Deferred tax expense on unrealized gain on unconsolidated co-investment	(1,457		)	—			(1,457		)	—
Gain on early retirement of debt, net	5,475			—			7,143			—
Gain on remeasurement of co-investment	—			—			31,535			—
Net income	$	105,700		$	86,110		$	329,266		$	289,159

32

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

Total assets for each of the reportable operating segments are summarized as follows as of September 30, 2019 and December 31, 2018 ($ in thousands):

	September 30, 2019		December 31, 2018
Assets:
Southern California	$	4,245,335	$	4,350,377
Northern California	4,623,559		4,270,238
Seattle Metro	1,444,045		1,472,916
Other real estate assets	66,579		63,022
Net reportable operating segment - real estate assets	10,379,518		10,156,553
Real estate under development	562,338		454,629
Co-investments	1,413,861		1,300,140
Cash and cash equivalents, including restricted cash	91,726		151,395
Marketable securities	216,894		209,545
Notes and other receivables	216,541		71,895
Operating lease right-of-use assets	75,478		—
Prepaid expenses and other assets	41,536		39,439
Total assets	$	12,997,892	$	12,383,596

(9) Net Income Per Common Share and Net Income Per Common Unit

($ in thousands, except share and unit data):

Essex Property Trust, Inc.

	Three Months Ended September 30, 2019					Three Months Ended September 30, 2018
	Income		Weighted- average Common Shares	Per Common Share Amount		Income		Weighted- average Common Shares	Per Common Share Amount
Basic:
Net income available to common stockholders	$	99,335	65,850,524	$	1.51	$	80,975	66,052,108	$	1.23
Effect of Dilutive Securities:
Stock options	—		122,561			—		51,704
Diluted:
Net income available to common stockholders	$	99,335	65,973,085	$	1.51	$	80,975	66,103,812	$	1.22

33

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

	Nine Months Ended September 30, 2019					Nine Months Ended September 30, 2018
	Income		Weighted- average Common Shares	Per Common Share Amount		Income		Weighted- average Common Shares	Per Common Share Amount
Basic:
Net income available to common stockholders	$	310,468	65,757,914	$	4.72	$	272,333	66,047,990	$	4.12
Effect of Dilutive Securities:
Stock options	—		99,746			—		45,014
Diluted:
Net income available to common stockholders	$	310,468	65,857,660	$	4.71	$	272,333	66,093,004	$	4.12

The tables above exclude from the calculations of diluted earnings per share weighted average convertible OP Units of 2,298,389 and 2,272,983, which include vested Series Z-1 Incentive Units, 2014 Long-Term Incentive Plan Units, and 2015 Long-Term Incentive Plan Units for the three months ended September 30, 2019 and 2018, respectively, and 2,300,888 and 2,273,163 for the nine months ended September 30, 2019 and 2018, respectively, because they were anti-dilutive. The related income allocated to these convertible OP Units aggregated $3.5 million and $2.8 million for the three months ended September 30, 2019 and 2018, respectively, and $10.9 million and $9.4 million for the nine months ended September 30, 2019 and 2018, respectively. Additionally, the tables exclude all DownREIT limited partnership units for which the Operating Partnership has the ability and intention to redeem the units for cash and does not consider them to be common stock equivalents.

Stock options of zero and 150,852 for the three months ended September 30, 2019 and 2018, respectively, and zero and 160,252 for the nine months ended September 30, 2019 and 2018, respectively, were excluded from the calculation of diluted earnings per share because the assumed proceeds per share of such options plus the average unearned compensation were greater than the average market price of the common stock for the periods ended and, therefore, were anti-dilutive.

Essex Portfolio, L.P.

	Three Months Ended September 30, 2019					Three Months Ended September 30, 2018
	Income		Weighted- average Common Units	Per Common Unit Amount		Income		Weighted- average Common Units	Per Common Unit Amount
Basic:
Net income available to common unitholders	$	102,799	68,148,913	$	1.51	$	83,764	68,325,091	$	1.23
Effect of Dilutive Securities:
Stock options	—		122,561			—		51,704
Diluted:
Net income available to common unitholders	$	102,799	68,271,474	$	1.51	$	83,764	68,376,795	$	1.23

34

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

	Nine Months Ended September 30, 2019					Nine Months Ended September 30, 2018
	Income		Weighted- average Common Units	Per Common Unit Amount		Income		Weighted- average Common Units	Per Common Unit Amount
Basic:
Net income available to common unitholders	$	321,331	68,058,802	$	4.72	$	281,714	68,321,153	$	4.12
Effect of Dilutive Securities:
Stock options	—		99,746			—		45,014
Diluted:
Net income available to common unitholders	$	321,331	68,158,548	$	4.71	$	281,714	68,366,167	$	4.12

Stock options of zero and 150,852 for the three months ended September 30, 2019 and 2018, respectively, and zero and 160,252 for the nine months ended September 30, 2019 and 2018, respectively, were excluded from the calculation of diluted earnings per unit because the assumed proceeds per unit of these options plus the average unearned compensation were greater than the average market price of the common unit for the periods ended and, therefore, were anti-dilutive. Additionally, the tables exclude all DownREIT limited partnership units for which the Operating Partnership has the ability and intention to redeem the units for cash and does not consider them to be common stock equivalents.

(10) Derivative Instruments and Hedging Activities

As of September 30, 2019, the Company had entered into interest rate swap contracts with an aggregate notional amount of $175.0 million that effectively fixed the interest rate on the $175.0 million unsecured term loan at 2.3%. These derivatives qualify for hedge accounting.

As of September 30, 2019, the Company had interest rate caps, which are not accounted for as hedges, totaling a notional amount of $9.9 million that effectively limit the Company’s exposure to interest rate risk by providing a ceiling on the variable interest rate for $9.9 million of the Company’s tax exempt variable rate debt.

As of September 30, 2019 and December 31, 2018, the aggregate carrying value of the interest rate swap contracts was an asset of $0.5 million and $5.8 million, respectively, and is included in prepaid expenses and other assets on the condensed consolidated balance sheets. The aggregate carrying value of the interest rate caps was zero on the condensed consolidated balance sheets as of both September 30, 2019 and December 31, 2018.

Hedge ineffectiveness related to cash flow hedges, which is included in interest expense on the condensed consolidated statements of income and comprehensive income, was not significant for the three and nine months ended September 30, 2019 and 2018.

Additionally, the Company has total return swap contracts, with an aggregate notional amount of $255.6 million, that effectively convert $255.6 million of mortgage notes payable to a floating interest rate based on the Securities Industry and Financial Markets Association Municipal Swap Index ("SIFMA") plus a spread. The total return swaps provide fair market value protection on the mortgage notes payable to the counterparties during the initial period of the total return swap until the Company's option to call the mortgage notes at par can be exercised. The Company can currently call all of its total return swaps, with $255.6 million of the outstanding debt at par. These derivatives do not qualify for hedge accounting and had a carrying and fair value of zero at both September 30, 2019 and December 31, 2018. These total return swaps are scheduled to mature between September 2021 and November 2022. The realized gains of $2.2 million and $2.2 million for the three months ended September 30, 2019 and 2018, respectively, and $6.2 million and $6.7 million for the nine months ended September 30, 2019 and 2018, respectively, were reported in the condensed consolidated statements of income and comprehensive income as total return swap income.

35

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

(11) Lease Agreements - Company as Lessor

As of September 30, 2019, the Company is a lessor of apartment homes at all of its consolidated operating and lease-up communities, one commercial building, and commercial portions of mixed use communities. The apartment homes are rented under short-term leases (generally, lease terms of nine to 12 months) while commercial lease terms typically range from five to 20 years. All such leases are classified as operating leases.

Although the majority of the Company’s apartment home and commercial leasing income is derived from fixed lease payments, some lease agreements also allow for variable payments. The primary driver of variable leasing income comes from utility reimbursements from apartment home leases and common area maintenance reimbursements from commercial leases. A small number of commercial leases contain provisions for lease payments based on a percentage of gross retail sales over set hurdles.

At the end of the term of apartment home leases, unless the lessee decides to renew the lease with the Company at the market rate or gives notice not to renew, the lease will be automatically renewed on a month-to-month term. Apartment home leases include an option to terminate the lease, however the lessee must pay the Company for expected or actual downtime to find a new tenant to lease the space or a lease-break fee specified in the lease agreement. Most commercial leases include options to renew, with the renewal periods extending the term of the lease for no greater than the same period of time as the original lease term. The initial option to renew for commercial leases will typically be based on a fixed price while any subsequent renewal options will generally be based on the current market rate at the time of the renewal. Certain commercial leases contain lease termination options that would require the lessee to pay termination fees based on the expected amount of time it would take the Company to re-lease the space.

The Company’s apartment home and commercial lease agreements do not contain residual value guarantees. As the Company is the lessor of real estate assets which tend to either hold their value or appreciate, residual value risk is not deemed to be substantial. Furthermore, the Company carries comprehensive liability, fire, extended coverage, and rental loss insurance for each of its communities as well as limited insurance coverage for certain types of extraordinary losses, such as, for example, losses from terrorism or earthquakes.

A maturity analysis of undiscounted future minimum non-cancelable base rent to be received under the above operating leases as of September 30, 2019 is summarized as follows ($ in thousands):

	Future Minimum Rent
Remaining in 2019	$	310,385
2020	489,601
2021	15,105
2022	14,080
2023	12,853
Thereafter	37,940
	$	879,964

36

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

As of December 31, 2018, in accordance with previously applicable lease accounting guidance, Accounting Standards Codification ("ASC") 840, "Leases", the future minimum non-cancelable base rent to be received under one commercial building and commercial portions of mixed use communities, for which the Company was the lessor, was as follows ($ in thousands):

	Future Minimum Rent
2019	$	16,386
2020	15,842
2021	14,412
2022	13,324
2023	12,181
Thereafter	33,034
	$	105,179

Practical Expedients

The Company has elected to account for operating lease (e.g., fixed payments including rent) and non-lease components (e.g., utility reimbursements and common-area maintenance costs) as a single combined lease component under ASC 842 as the lease components are the predominant elements of the combined components.

As part of the transition to ASC 842, the Company has elected to use the modified retrospective transition method with the new standard being applied as of the January 1, 2019 adoption date. Additionally, the Company has elected, as of the adoption date, not to reassess whether expired or existing contracts contain leases under the new definition of a lease, not to reassess the lease classification for expired or existing leases, not to reassess whether previously capitalized initial direct costs would qualify for capitalization under ASC 842, and not to reassess whether existing or expired land easements meet the definition of a lease.

(12) Lease Agreements - Company as Lessee

As of September 30, 2019, the Company is a lessee of corporate office space, ground leases and a parking lease associated with various consolidated properties, and equipment. Lease terms for the Company's office leases, in general, range between five to 10 years while ground leases and the parking lease have terms typically ranging from 20 to 85 years. The corporate office leases occasionally contain renewal options of approximately five years while certain ground leases contain renewal options that can extend the lease term from approximately 10 to 39 years.

A majority of the Company’s ground leases and the parking lease are subject to changes in the Consumer Price Index ("CPI"). Furthermore, certain of the Company’s ground leases include rental payments based on a percentage of gross or net income. While lease liabilities are not remeasured as a result of changes in the CPI or percentage of gross or net income, such changes are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred.

The Company’s lease agreements do not contain any residual value guarantees or restrictive covenants.

Operating lease right-of-use assets and operating lease liabilities are recognized based on the present value of lease payments over the lease term at commencement date. Because most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

As of September 30, 2019 and December 31, 2018, the Company had no material finance leases.

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ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

Supplemental condensed consolidated balance sheet information related to leases as of September 30, 2019 is as follows ($ in thousands):

	Classification	September 30, 2019
Assets
Operating lease right-of-use assets	Operating lease right-of-use assets	$	75,478
Total leased assets		$	75,478
Liabilities
Operating lease liabilities	Operating lease liabilities	77,495
Total lease liabilities		$	77,495

The components of lease expense for the three and nine months ended September 30, 2019 were as follows ($ in thousands):

	Three Months Ended September 30, 2019			Nine Months Ended September 30, 2019
Operating lease cost	$	1,686		$	5,059
Variable lease cost	109			622
Short-term lease cost	171			455
Sublease income	(109		)	(326		)
Total lease cost	$	1,857		$	5,810

A maturity analysis of lease liabilities as of September 30, 2019 are as follows ($ in thousands):

	Operating Leases
Remaining in 2019	$	1,717
2020	6,855
2021	6,877
2022	6,888
2023	6,860
Thereafter	153,258
Total lease payments	$	182,455
Less: Imputed interest	(104,960		)
Present Value of lease liabilities	$	77,495

Lease term and discount rate information for leases at September 30, 2019 are as follows:

Weighted-average of remaining lease terms (years)
Operating Leases	39
Weighted-average of discount rates
Operating Leases	4.99	%

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ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

September 30, 2019 and 2018

(Unaudited)

As of December 31, 2018, in accordance with previously applicable lease accounting guidance, ASC 840, the total minimum lease commitments under operating leases was as follows ($ in thousands):

	Future Minimum Rent
2019	$	6,811
2020	6,855
2021	6,877
2022	6,888
2023	6,860
Thereafter	153,258
	$	187,549

Practical Expedients

As part of the transition to ASC 842, the Company elected to use the modified retrospective transition method with the new standard being applied as of the January 1, 2019 adoption date. Additionally, the Company has elected, as of the adoption date, not to reassess whether expired or existing contracts contain leases under the new definition of a lease, not to reassess the lease classification for expired or existing leases, not to reassess whether previously capitalized initial direct costs would qualify for capitalization under ASC 842, and not to reassess whether existing or expired land easements meet the definition of a lease.

Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company recognizes the lease expense for such leases on a straight-line basis over the lease term.

The Company has elected to account for lease components (e.g., fixed payments including rent) and non-lease components (e.g., common-area maintenance costs) as a single combined lease component as the lease components are the predominant elements of the combined components.

(13) Commitments and Contingencies

The Company is subject to various lawsuits in the normal course of its business operations. Such lawsuits have not had a material adverse effect on the Company's financial condition, results of operations or cash flows. While no assurances can be given, the Company does not believe there is any pending or threatened litigation against the Company that, individually or in the aggregate, would reasonably be expected to have a material adverse effect on the Company.

The Company is subject to various federal, state, and local environmental laws. Compliance by the Company with existing laws has not had a material adverse effect on the Company. However, the Company cannot predict the impact of new or changed laws or regulations on its current portfolio or on other assets that the Company may acquire in the future. To the extent that an environmental matter arises or is identified in the future that has other than a remote risk of having a material impact on the condensed consolidated financial statements, the Company will disclose the estimated range of possible outcomes associated with it, and, if an outcome is probable, accrue an appropriate liability for that matter. The Company will consider whether any such matter results in an impairment of value on the affected property and, if so, impairment will be recognized.

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Item 2: Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with the Company’s Condensed Consolidated Financial Statements and accompanying Notes thereto included elsewhere herein and with the Company’s 2018 annual report on Form 10-K for the year ended December 31, 2018. Capitalized terms not defined in this section have the meaning ascribed to them elsewhere in this Quarterly Report on Form 10-Q. The Company makes statements in this section that are forward-looking statements within the meaning of the federal securities laws. For a complete discussion of forward-looking statements, see the section in this Form 10-Q entitled "Forward-Looking Statements."

Essex is a self-administered and self-managed REIT that acquires, develops, redevelops, and manages apartment communities in selected residential areas located on the West Coast of the United States. Essex owns all of its interests in its real estate investments, directly or indirectly through the Operating Partnership. Essex is the sole general partner of the Operating Partnership and, as of September 30, 2019, had an approximately 96.6% general partnership interest in the Operating Partnership.

The Company’s investment strategy has two components: constant monitoring of existing markets, and evaluation of new markets to identify areas with the characteristics that underlie rental growth. The Company’s strong financial condition supports its investment strategy by enhancing its ability to quickly shift acquisition, development, redevelopment, and disposition activities to markets that will optimize the performance of the portfolio.

As of September 30, 2019, the Company owned or had ownership interests in 249 operating apartment communities, comprising 60,620 apartment homes, excluding the Company’s ownership interest in preferred equity co-investments, loan investments, one operating commercial building, and seven active developments. The Company’s apartment communities are located in the following major regions:

Southern California (primarily Los Angeles, Orange, San Diego, and Ventura counties)

Northern California (the San Francisco Bay Area)

Seattle Metro (Seattle metropolitan area)

As of September 30, 2019, the Company’s development pipeline was comprised of five consolidated projects under development, two unconsolidated joint venture projects under development, and various consolidated predevelopment projects aggregating 1,960 apartment homes, with total incurred costs of $1.0 billion, and estimated remaining project costs of $0.3 billion, $0.2 billion of which represents the Company's share of estimated remaining costs, for total estimated project costs of $1.3 billion.

The Company’s consolidated apartment communities are as follows:

	As of September 30, 2019			As of September 30, 2018
	Apartment Homes	%		Apartment Homes	%
Southern California	22,674	45	%	22,964	47	%
Northern California	17,556	35	%	15,970	32	%
Seattle Metro	10,238	20	%	10,238	21	%
Total	50,468	100	%	49,172	100	%

Co-investments, including Wesco I, Wesco III, Wesco IV, Wesco V, CPPIB, BEXAEW, BEX II, BEX III, and BEX IV communities, developments under construction, and preferred equity interest co-investment communities are not included in the table presented above for both periods.

Comparison of the Three Months Ended September 30, 2019 to the Three Months Ended September 30, 2018

The Company’s average financial occupancy for the Company’s stabilized apartment communities or "Same-Property" (stabilized properties consolidated by the Company for the quarters ended September 30, 2019 and 2018) was 96.0% and 96.4% for the three months ended September 30, 2019 and 2018, respectively. Financial occupancy is defined as the percentage resulting from dividing actual rental income by total potential rental income. Actual rental income represents contractual rental income pursuant to leases without considering delinquency and concessions. Total potential rental income represents the value of all apartment homes, with occupied apartment homes valued at contractual rental rates pursuant to

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leases and vacant apartment homes valued at estimated market rents. The Company believes that financial occupancy is a meaningful measure of occupancy because it considers the value of each vacant apartment home at its estimated market rate.

Market rates are determined using the recently signed effective rates on new leases at the property and are used as the starting point in the determination of the market rates of vacant apartment homes. The Company may increase or decrease these rates based on a variety of factors, including overall supply and demand for housing, concentration of new apartment deliveries within the same submarket which can cause periodic disruption due to greater rental concessions to increase leasing velocity, and rental affordability. Financial occupancy may not completely reflect short-term trends in physical occupancy and financial occupancy rates, and the Company's calculation of financial occupancy may not be comparable to financial occupancy disclosed by other REITs.

The Company does not take into account delinquency and concessions to calculate actual rent for occupied apartment homes and market rents for vacant apartment homes. The calculation of financial occupancy compares contractual rates for occupied apartment homes to estimated market rents for unoccupied apartment homes, and thus the calculation compares the gross value of all apartment homes excluding delinquency and concessions. For apartment communities that are development properties in lease-up without stabilized occupancy figures, the Company believes the physical occupancy rate is the appropriate performance metric. While an apartment community is in the lease-up phase, the Company’s primary motivation is to stabilize the property which may entail the use of rent concessions and other incentives, and thus financial occupancy, which is based on contractual income, is not considered the best metric to quantify occupancy.

The regional breakdown of the Company’s Same-Property portfolio for financial occupancy for the three months ended September 30, 2019 and 2018 is as follows:

	Three Months Ended September 30,
	2019		2018
Southern California	96.1	%	96.5	%
Northern California	95.8	%	96.3	%
Seattle Metro	95.9	%	96.1	%

The following table provides a breakdown of revenues amounts, including revenues attributable to the Same-Properties:

	Number of Apartment	Three Months Ended September 30,				Dollar		Percentage
Property Revenues ($ in thousands)	Homes	2019		2018		Change		Change
Same-Property Revenues:
Southern California	21,979	$	147,557	$	144,002	$	3,555	2.5	%
Northern California	15,685	132,900		128,462		4,438		3.5	%
Seattle Metro	10,238	61,658		59,231		2,427		4.1	%
Total Same-Property Revenues	47,902	342,115		331,695		10,420		3.1	%
Non-Same Property Revenues		22,389		16,915		5,474		32.4	%
Total Property Revenues		$	364,504	$	348,610	$	15,894	4.6	%

Same-Property Revenues increased by $10.4 million or 3.1% to $342.1 million in the third quarter of 2019 from $331.7 million in the third quarter of 2018. The increase was primarily attributable to an increase of 3.5% in average rental rates from $2,260 per apartment home in the third quarter of 2018 to $2,339 per apartment home in the third quarter of 2019. 

Non-Same Property Revenues increased by $5.5 million or 32.4% to $22.4 million in the third quarter of 2019 from $16.9 million in the third quarter of 2018. The increase was primarily due to revenues generated from Marquis, which was consolidated in December 2018, Station Park Green - Phase I, a development community that began producing rental income during the first quarter of 2018, One South Market, which was consolidated in March 2019, and Brio, which was acquired in June 2019. These increases were partially offset by the sale of 8th & Hope in the fourth quarter of 2018.

Management and other fees from affiliates remained relatively flat at $2.4 million in the third quarter of 2019 compared to $2.3 million in the third quarter of 2018.

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Property operating expenses, excluding real estate taxes increased $4.1 million or 6.9% to $63.2 million for the third quarter of 2019 compared to $59.1 million for the third quarter of 2018 primarily due to an increase of $1.9 million in administrative expenses and an increase of $1.4 million in maintenance and repairs expenses. Same-Property operating expenses, excluding real estate taxes, increased by $3.1 million or 5.4% to $60.4 million in the third quarter of 2019 compared to $57.3 million in the third quarter of 2018, primarily due to an increase of $1.4 million in administrative expenses and an increase of $1.1 million in maintenance and repairs expenses.

Real estate taxes increased $0.6 million or 1.6% to $39.3 million for the third quarter of 2019 compared to $38.7 million for the third quarter of 2018, primarily due to property tax expenses for Brio which was acquired in the second quarter of 2019. Same-Property real estate taxes remained relatively flat at $36.2 million in the third quarter of 2019 compared to the third quarter of 2018.

Corporate-level property management expenses increased $0.5 million or 6.4% to $8.3 million in the third quarter of 2019 compared to $7.8 million in the third quarter of 2018, primarily due to an increase in corporate-level property management and staffing costs supporting the communities.

Depreciation and amortization expense decreased by $0.1 million or 0.1% to $120.8 million for the third quarter of 2019 compared to $120.9 million for the third quarter of 2018, primarily due to the sale of 8th & Hope in the fourth quarter of 2018 as well as the completion of depreciation on various property assets from the Company's merger with BRE that had a five year depreciable life. These decreases were offset by the consolidation of Marquis in the fourth quarter of 2018, consolidation of One South Market in the first quarter of 2019, and the acquisition of Brio in the second quarter of 2019.

Interest expense decreased by $0.3 million or 0.5% to $54.9 million for the third quarter of 2019 compared to $55.2 million for the third quarter of 2018, primarily due to debt that was paid off or matured, as well as regular principal amortization during and after the third quarter of 2018, which resulted in a decrease in interest expense of $8.0 million for the third quarter of 2019. Additionally, there was a $1.8 million increase in capitalized interest in the third quarter of 2019, due to an increase in development costs as compared to the same period in 2018. These decreases to interest expense were partially offset by an increase in average outstanding debt primarily as a result of the issuance of $500.0 million of senior unsecured notes due March 1, 2029 in February and March 2019 and $400.0 million of senior unsecured notes due January 15, 2030 in August 2019, which resulted in an increase of $9.5 million interest expense for the third quarter of 2019.

Total return swap income of $2.2 million in the third quarter of 2019 consists of monthly settlements related to the Company's total return swap contracts that were entered into during 2015 in connection with issuing fixed rate tax-exempt mortgage notes.

Interest and other income increased by $0.3 million or 3.6% to $8.7 million for the third quarter of 2019 compared to $8.4 million for the third quarter of 2018, primarily due to an increase of $1.6 million in marketable securities and other income.

Equity income from co-investments increased $4.9 million or 29.2% to $21.7 million for the third quarter of 2019 compared to $16.8 million for the third quarter of 2018, primarily due to a net unrealized gain of $4.4 million from an unconsolidated co-investment during the third quarter of 2019.

Gain on early retirement of debt, net of $5.5 million for the third quarter of 2019 was primarily due to early repayment of a $289.1 million secured mortgage note payable in September 2019.

Deferred tax expense on unrealized gain on unconsolidated co-investment of $1.5 million for the third quarter of 2019 resulted from a net unrealized gain of $4.4 million from an unconsolidated co-investment during the third quarter of 2019.

Comparison of the Nine Months Ended September 30, 2019 to the Nine Months Ended September 30, 2018

Our average financial occupancy for the Company's stabilized apartment communities or "Same-Property" (stabilized properties consolidated by the Company for the nine months ended September 30, 2019 and 2018) was 96.5% and 96.7% for the nine months ended September 30, 2019 and 2018, respectively.

The regional breakdown of the Company’s Same-Property portfolio for financial occupancy for the nine months ended September 30, 2019 and 2018 is as follows:

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	Nine Months Ended September 30,
	2019		2018
Southern California	96.5	%	96.7	%
Northern California	96.5	%	96.8	%
Seattle Metro	96.4	%	96.4	%

The following table provides a breakdown of revenue amounts, including revenues attributable to the Same-Properties:

	Number of Apartment	Nine Months Ended September 30,				Dollar		Percentage
Property Revenues ($ in thousands)	Homes	2019		2018		Change		Change
Same-Property Revenues:
Southern California	21,979	$	440,937	$	428,536	$	12,401	2.9	%
Northern California	15,685	395,833		382,288		13,545		3.5	%
Seattle Metro	10,238	182,739		176,740		5,999		3.4	%
Total Same-Property Revenues	47,902	1,019,509		987,564		31,945		3.2	%
Non-Same Property Revenues		58,258		52,519		5,739		10.9	%
Total Property Revenues		$	1,077,767	$	1,040,083	$	37,684	3.6	%

Same-Property Revenues increased by $31.9 million or 3.2% to $1.0 billion in the nine months ended September 30, 2019 from $987.6 million in the nine months ended September 30, 2018. The increase was primarily attributable to an increase of 3.4% in average rental rates from $2,233 per apartment home in the nine months ended September 30, 2018 to $2,309 per apartment home in the nine months ended September 30, 2019.

Non-Same Property Revenues increased by $5.7 million or 10.9% to $58.3 million in the nine months ended September 30, 2019 from $52.5 million in the nine months ended September 30, 2018.  The increase was primarily due to revenues generated from Marquis, which was consolidated in December 2018, Station Park Green - Phase I, a development community that began producing rental income during the first quarter of 2018, One South Market, which was consolidated in March 2019, and Brio, which was acquired in June 2019. These increases were partially offset by the sales of Domain in the second quarter of 2018 and of 8th & Hope in the fourth quarter of 2018.

Management and other fees from affiliates remained relatively flat at $7.0 million for the nine months ended September 30, 2019 compared to $6.8 million for the nine months ended September 30, 2018.

Property operating expenses, excluding real estate taxes increased $6.7 million or 3.8% to $181.2 million for the nine months ended September 30, 2019 compared to $174.5 million for the nine months ended September 30, 2018 primarily due to an increase of $2.9 million in maintenance and repairs expense and an increase of $2.0 million in utilities expenses. Same-Property operating expenses, excluding real estate taxes, increased by $6.3 million or 3.7% to $174.8 million for the nine months ended September 30, 2019 compared to $168.5 million for the nine months ended September 30, 2018, primarily due to an increase of $2.5 million in maintenance and repairs expense and an increase of $2.0 million in administrative expenses.

Real estate taxes increased $2.6 million or 2.3% to $115.0 million for the nine months ended September 30, 2019 compared to $112.4 million for the nine months ended September 30, 2018 primarily due to increases in property valuations in Southern and Northern California and property tax expenses for Brio, which was acquired in the second quarter of 2019, offset by favorable tax assessments in the Seattle Metro region. Same-Property real estate taxes increased by $2.0 million or 1.9% to $108.4 million for the nine months ended September 30, 2019 compared to $106.4 million for the nine months ended September 30, 2018 primarily due to increases in property valuations in Southern and Northern California, offset by favorable tax assessments in the Seattle Metro region.

Corporate-level property management expenses increased $1.3 million or 5.6% to $24.6 million for the nine months ended September 30, 2019 compared to $23.3 million for the nine months ended September 30, 2018 primarily due to an increase in corporate-level property management and staffing costs supporting the communities.

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Depreciation and amortization expense increased by $1.5 million or 0.4% to $360.8 million for the nine months ended September 30, 2019 compared to $359.3 million for the nine months ended September 30, 2018, primarily due to the completion of the Station Park Green - Phase I development during the first and second quarters of 2018, consolidation of Marquis in the fourth quarter of 2018, consolidation of One South Market in the first quarter of 2019, and the acquisition of Brio in the second quarter of 2019. The increase was partially offset by the sales of Domain in the second quarter of 2018 and of 8th & Hope in the fourth quarter of 2018.

Interest expense decreased $3.6 million or 2.2% to $162.7 million for the nine months ended September 30, 2019 compared to $166.3 million for the nine months ended September 30, 2018, primarily due to various debt that was paid off or matured and regular principal amortization during and after the nine months ended September 30, 2018, which resulted in a decrease in interest expense of $18.1 million for the nine months ended September 30, 2019. Additionally, there was a $5.7 million increase in capitalized interest in the three months ended September 30, 2019, which was due to an increase in development costs as compared to the same period in 2018. These decreases to interest expense were partially offset by an increase in average outstanding debt primarily as a result of the issuance of $300.0 million senior unsecured notes due March 15, 2048 in March 2018, $500.0 million of senior unsecured notes due March 1, 2029 in February and March 2019, and $400.0 of million senior unsecured notes due January 15, 2030 in August 2019, which resulted in an increase of $20.2 million of interest expense for the nine months ended September 30, 2019 as compared to the nine months ended September 30, 2018.

Total return swap income of $6.2 million for the nine months ended September 30, 2019 consists of monthly settlements related to the Company's total return swap contracts that were entered into during 2015 in connection with issuing fixed rate tax-exempt mortgage notes. The decrease of $0.5 million or 7.5% from $6.7 million for the nine months ended September 30, 2018 was due to less favorable interest rates.

Interest and other income increased by $8.1 million or 38.2% to $29.3 million for the nine months ended September 30, 2019 compared to $21.2 million for the nine months ended September 30, 2018, primarily due to an increase of $4.4 million in marketable securities and other income and an increase of $3.9 million in unrealized gains on marketable securities recognized through income.

Equity income from co-investments decreased $9.7 million or 15.0% to $54.9 million for the nine months ended September 30, 2019 compared to $64.6 million for the nine months ended September 30, 2018, primarily due to a decrease in promote income. In the first quarter of 2019, the Company recognized $0.8 million of promote income from the acquisition of One South Market compared to $20.5 million recognized in first quarter of 2018 from the BEXAEW joint venture, resulting in a decrease of $19.7 million in promote income. The decrease was partially offset by an increase of $5.7 million in income from preferred equity investments and a net unrealized gain of $4.4 million from an unconsolidated co-investment during the third quarter of 2019.

Gain on early retirement of debt, net of $7.1 million for the nine months ended September 30, 2019 is primarily due to early repayment of a $289.1 million secured mortgage note payable in September 2019.

Deferred tax expense on unrealized gain on unconsolidated co-investment of $1.5 million for the nine months ended September 30, 2019 resulted from a net unrealized gain of $4.4 million from an unconsolidated co-investment during the third quarter of 2019.

Gain on remeasurement of co-investment of $31.5 million for the nine months ended September 30, 2019 resulted from the purchase of the Company's joint venture partner's 45.0% membership interest in the One South Market co-investment in March 2019.

Liquidity and Capital Resources

As of September 30, 2019, the Company had $74.0 million of unrestricted cash and cash equivalents and $216.9 million in marketable securities, of which $73.0 million were equity securities or available for sale debt securities. The Company believes that cash flows generated by its operations, existing cash and cash equivalents, marketable securities balances, availability under existing lines of credit, access to capital markets and the ability to generate cash from the disposition of real estate are sufficient to meet all of its reasonably anticipated cash needs during the next twelve months. The timing, source and amounts of cash flows provided by financing activities and used in investing activities are sensitive to changes in interest rates and other fluctuations in the capital markets environment, which can affect the Company's plans for acquisitions, dispositions, development and redevelopment activities.

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As of September 30, 2019, Fitch Ratings, Moody’s Investor Service, and Standard and Poor's credit agencies rate the Company and the Operating Partnership, BBB+/Stable, Baa1/Stable, and BBB+/Stable, respectively.

As of September 30, 2019, the Company had two unsecured lines of credit aggregating $1.24 billion. As of September 30, 2019, there was $220.0 million outstanding on the Company's $1.2 billion unsecured line of credit. The underlying interest rate is based on a tiered rate structure tied to the Company's credit ratings and was LIBOR plus 0.825% as of September 30, 2019. This facility is scheduled to mature in December 2022, with one 18-month extension, exercisable at the Company's option. As of September 30, 2019, there was no amount outstanding on the Company's $35.0 million working capital unsecured line of credit. The underlying interest rate on the $35.0 million line is based on a tiered rate structure tied to the Company's credit ratings and was LIBOR plus 0.825% as of September 30, 2019. This facility is scheduled to mature in February 2021.

In August 2019, the Operating Partnership issued $400.0 million of senior unsecured notes due on January 15, 2030, with a coupon rate of 3.000% (the "2030 Notes"), which are payable on January 15 and July 15 of each year, beginning on January 15, 2020. The 2030 Notes were offered to investors at a price of 98.632% of the principal amount thereof. The 2030 Notes are general unsecured senior obligations of the Operating Partnership, rank equally in right of payment with all other senior unsecured indebtedness of the Operating Partnership and are unconditionally guaranteed by the Company. The Company used the net proceeds of this offering to prepay, with no prepayment penalties, certain secured indebtedness under outstanding mortgage notes, to repay indebtedness under its unsecured lines of credit and for other general corporate and working capital purposes.

In February 2019, the Operating Partnership issued $350.0 million of senior unsecured notes due on March 1, 2029, with a coupon rate of 4.000% (the "2029 Notes"), which are payable on March 1 and September 1 of each year, beginning on September 1, 2019. The 2029 Notes were offered to investors at a price of 99.188% of the principal amount thereof. The 2029 Notes are general unsecured senior obligations of the Operating Partnership, rank equally in right of payment with all other senior unsecured indebtedness of the Operating Partnership and are unconditionally guaranteed by the Company. In March 2019, the Operating Partnership issued an additional $150.0 million of the 2029 Notes at a price of 100.717% of the principal amount thereof. These additional notes have substantially identical terms as the 2029 Notes issued in February 2019. The Company used the net proceeds of these offerings to repay indebtedness under its unsecured lines of credit and for other general corporate and working capital purposes.

In January 2019, the Company repaid $290.0 million in secured mortgage notes payable with a coupon rate of 5.57% and a stated maturity date of May 2019.

In September 2018, the Company entered into a new equity distribution agreement pursuant to which the Company may offer and sell shares of its common stock having an aggregate gross sales price of up to $900.0 million (the "2018 ATM Program"). In connection with the 2018 ATM Program, the Company may also enter into related forward sale agreements whereby, at the Company’s discretion, it may sell shares of its common stock under the 2018 ATM Program under forward sales agreements. The use of a forward sales agreement would allow the Company to lock in a share price on the sale of shares of its common stock at the time the agreement is executed, but defer receiving the proceeds from the sale of shares until a later date. During the nine months ended September 30, 2019, the Company issued 228,271 shares of common stock through the 2018 ATM Program at an average price of $321.56 per share for proceeds of $73.4 million. As of September 30, 2019, there are no outstanding forward purchase agreements, and $826.6 million of shares remain available to be sold under this program.

In December 2015, the Company’s board of directors authorized a stock repurchase plan to allow the Company to acquire shares in an aggregate of up to $250.0 million. In February 2019, the board of directors approved the replenishment of the stock repurchase plan such that, as of such date, the Company had $250.0 million of purchase authority remaining under the stock repurchase plan. During the nine months ended September 30, 2019, the Company repurchased and retired 234,061 shares of its common stock totaling $57.0 million, including commissions, at an average price of $243.48 per share. As of September 30, 2019, the Company had $250.0 million of purchase authority remaining under the stock repurchase plan.

Essex pays quarterly dividends from cash available for distribution. Until it is distributed, cash available for distribution is invested by the Company primarily in investment grade securities held available for sale or is used by the Company to reduce balances outstanding under its line of credit. 

Development and Predevelopment Pipeline

The Company defines development projects as new communities that are being constructed, or are newly constructed and are in a phase of lease-up and have not yet reached stabilized operations. As of September 30, 2019, the Company’s development pipeline was comprised of five consolidated projects under development, two unconsolidated joint venture projects under

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development and various consolidated predevelopment projects, aggregating 1,960 apartment homes, with total incurred costs of $1.0 billion, and estimated remaining project costs of approximately $0.3 billion, $0.2 billion of which represents the Company's share of estimated remaining costs, for total estimated project costs of $1.3 billion.

The Company expects to fund the development and predevelopment pipeline by using a combination of some or all of the following sources: its working capital, amounts available on its lines of credit, construction loans, net proceeds from public and private equity and debt issuances, and proceeds from the disposition of assets, if any.

Redevelopment Pipeline

The Company defines redevelopment communities as existing properties owned or recently acquired, which have been targeted for additional investment by the Company with the expectation of increased financial returns through property improvement. During redevelopment, apartment homes may not be available for rent and, as a result, may have less than stabilized operations. As of September 30, 2019, the Company had ownership interests in four major redevelopment communities aggregating 1,327 apartment homes with estimated redevelopment costs of $132.7 million, of which approximately $17.0 million remains to be expended. The Company has the ability to cease funding of the redevelopment pipeline as needed.

Derivative Activity

The Company uses interest rate swaps, interest rate caps, and total return swap contracts to manage certain interest rate risks. The valuation of these instruments is determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves. The fair values of interest rate swaps and total return swaps are determined using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. The Company incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements.

Alternative Capital Sources

The Company utilizes co-investments as an alternative source of capital for acquisitions of both operating and development communities. As of September 30, 2019, the Company had an interest in 806 apartment homes in communities actively under development with joint ventures for total estimated costs of $0.6 billion. Total estimated remaining costs are approximately $87.0 million, of which the Company estimates its remaining investment in these development joint ventures will be approximately $43.5 million. In addition, the Company had an interest in 10,827 apartment homes of operating communities with joint ventures for a total book value of $863.8 million as of September 30, 2019.

Off-Balance Sheet Arrangements

The Company has various unconsolidated interests in certain joint ventures. The Company does not believe that these unconsolidated investments have a materially different impact on its liquidity, cash flows, capital resources, credit or market risk than its consolidated operations. See Note 4, Co-investments, in the Notes to Condensed Consolidated Financial Statements for carrying values and combined summarized financial information of these unconsolidated investments.

Critical Accounting Policies and Estimates

The preparation of condensed consolidated financial statements, in accordance with U.S. GAAP, requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosures of contingent assets and liabilities. The Company defines critical accounting policies as those accounting policies that require the Company’s management to exercise their most difficult, subjective and complex judgments. The Company’s critical accounting policies and estimates relate principally to the following key areas: (i) accounting for the acquisition of investments in real estate. Specifically, the allocation between land and buildings; and (ii) evaluation of events and changes in circumstances indicating whether the Company’s rental properties may be impaired. The Company bases its estimates on historical experience, current market conditions, and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may differ from those estimates made by management.

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The Company’s critical accounting policies and estimates have not changed materially from the information reported in Note 2, Summary of Critical and Significant Accounting Policies, in the Company’s annual report on Form 10-K for the year ended December 31, 2018.

Forward-Looking Statements

Certain statements in this "Management's Discussion and Analysis of Financial Condition and Results of Operations," and elsewhere in this quarterly report on Form 10-Q which are not historical facts may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Exchange Act, including statements regarding the Company's expectations, estimates, assumptions, hopes, intentions, beliefs and strategies regarding the future. Words such as "expects," "assumes," "anticipates," "may," "will," "intends," "plans," "projects," "believes," "seeks," "future," "estimates," and variations of such words and similar expressions are intended to identify such forward-looking statements. Such forward-looking statements include, among other things, statements regarding the Company’s intent, beliefs or expectations with respect to the timing of completion of current development and redevelopment projects and the stabilization of such projects, the timing of lease-up and occupancy of its apartment communities, the anticipated operating performance of its apartment communities, the total projected costs of development and redevelopment projects, co-investment activities, qualification as a REIT under the Internal Revenue Code of 1986, as amended, the real estate markets in the geographies in which the Company’s properties are located and in the United States in general, the adequacy of future cash flows to meet anticipated cash needs, its financing activities and the use of proceeds from such activities, the availability of debt and equity financing, general economic conditions including the potential impacts from economic conditions, trends affecting the Company’s financial condition or results of operations, changes to U.S. tax laws and regulations in general or specifically related to REITs or real estate, changes to laws and regulations in jurisdictions in which communities the Company owns are located, and other information that is not historical information.

While the Company's management believes the assumptions underlying its forward-looking statements are reasonable, such forward-looking statements involve known and unknown risks, uncertainties and other factors, many of which are beyond the Company’s control, which could cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The Company cannot assure the future results or outcome of the matters described in these statements; rather, these statements merely reflect the Company’s current expectations of the approximate outcomes of the matters discussed. Factors that might cause the Company’s actual results, performance or achievements to differ materially from those expressed or implied by these forward-looking statements include, but are not limited to, the following: the Company may fail to achieve its business objectives; the actual completion of development and redevelopment projects may be subject to delays; the stabilization dates of such projects may be delayed; the Company may abandon or defer development or redevelopment projects for a number of reasons, including changes in local market conditions which make development less desirable, increases in costs of development, increases in the cost of capital or lack of capital availability, resulting in losses; the total projected costs of current development and redevelopment projects may exceed expectations; such development and redevelopment projects may not be completed; development and redevelopment projects and acquisitions may fail to meet expectations; estimates of future income from an acquired property may prove to be inaccurate; occupancy rates and rental demand may be adversely affected by competition and local economic and market conditions; there may be increased interest rates and operating costs; the Company may be unsuccessful in the management of its relationships with its co-investment partners; future cash flows may be inadequate to meet operating requirements and/or may be insufficient to provide for dividend payments in accordance with REIT requirements; there may be a downturn in general economic conditions, the real estate industry, and the markets in which the Company's communities are located; changes in laws or regulations; the terms of any refinancing may not be as favorable as the terms of existing indebtedness; unexpected difficulties in leasing of development projects; volatility in financial and securities markets; the Company’s failure to successfully operate acquired properties; unforeseen consequences from cyber-intrusion; the Company’s inability to maintain our investment grade credit rating with the rating agencies; government approvals, actions and initiatives, including the need for compliance with environmental requirements; and those further risks, special considerations, and other factors referred to in this quarterly report on Form 10-Q, in the Company's annual report on Form 10-K for the year ended December 31, 2018, and in the Company's other filings with the Securities and Exchange Commission (the "SEC"). All forward-looking statements are made as of the date hereof, the Company assumes no obligation to update or supplement this information for any reason, and therefore, they may not represent the Company’s estimates and assumptions after the date of this report.

Funds from Operations Attributable to Common Stockholders and Unitholders

Funds from Operations Attributable to Common Stockholders and Unitholders ("FFO") is a financial measure that is commonly used in the REIT industry. The Company presents FFO and FFO excluding non-core items (referred to as "Core FFO") as supplemental operating performance measures. FFO and Core FFO are not used by the Company as, nor should they be

47

considered to be, alternatives to net income computed under U.S. GAAP as an indicator of the Company’s operating performance or as alternatives to cash from operating activities computed under U.S. GAAP as an indicator of the Company’s ability to fund its cash needs.

FFO and Core FFO are not meant to represent a comprehensive system of financial reporting and do not present, nor do they intend to present, a complete picture of the Company's financial condition and operating performance. The Company believes that net income computed under U.S. GAAP is the primary measure of performance and that FFO and Core FFO are only meaningful when they are used in conjunction with net income. 

The Company considers FFO and Core FFO to be useful financial performance measurements of an equity REIT because, together with net income and cash flows, FFO and Core FFO provide investors with additional bases to evaluate operating performance and ability of a REIT to incur and service debt and to fund acquisitions and other capital expenditures and to pay dividends. By excluding gains or losses related to sales of depreciated operating properties and excluding real estate depreciation (which can vary among owners of identical assets in similar condition based on historical cost accounting and useful life estimates), FFO can help investors compare the operating performance of a real estate company between periods or as compared to different companies. By further adjusting for items that are not considered part of the Company’s core business operations, Core FFO allows investors to compare the core operating performance of the Company 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. The Company believes that its consolidated financial statements, prepared in accordance with U.S. GAAP, provide the most meaningful picture of its financial condition and its operating performance.

In calculating FFO, the Company follows the definition for this measure published by the National Association of Real Estate Investment Trusts ("NAREIT"), which is the leading REIT industry association. The Company believes that, under the NAREIT FFO definition, the two most significant adjustments made to net income are (i) the exclusion of historical cost depreciation and (ii) the exclusion of gains and losses from the sale of previously depreciated properties. The Company agrees that these two NAREIT adjustments are useful to investors for the following reasons:

(a) historical cost accounting for real estate assets in accordance with U.S. GAAP assumes, through depreciation charges, that the value of real estate assets diminishes predictably over time. NAREIT stated in its White Paper on Funds from Operations "since real estate asset values have historically risen or fallen with market conditions, many industry investors have considered presentations of operating results for real estate companies that use historical cost accounting to be insufficient by themselves." Consequently, NAREIT’s definition of FFO reflects the fact that real estate, as an asset class, generally appreciates over time and depreciation charges required by U.S. GAAP do not reflect the underlying economic realities.

(b) REITs were created as a legal form of organization in order to encourage public ownership of real estate as an asset class through investment in firms that were in the business of long-term ownership and management of real estate.  The exclusion, in NAREIT’s definition of FFO, of gains and losses from the sales of previously depreciated operating real estate assets allows investors and analysts to readily identify the operating results of the long-term assets that form the core of a REIT’s activity and assists in comparing those operating results between periods.

Management believes that it has consistently applied the NAREIT definition of FFO to all periods presented. However, there is judgment involved and other REITs’ calculation of FFO may vary from the NAREIT definition for this measure, and thus their disclosure of FFO may not be comparable to the Company’s calculation.

The following table is a reconciliation of net income available to common stockholders to FFO and Core FFO for the nine months ended September 30, 2019 and 2018 (in thousands, except share and per share amounts):

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Essex Property Trust, Inc.

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Net income available to common stockholders	$	99,335		$	80,975		$	310,468		$	272,333
Adjustments:
Depreciation and amortization	120,809			120,852			360,842			359,287
Gains not included in FFO attributable to common stockholders and unitholders	—			—			(32,405		)	(22,244		)
Depreciation and amortization from unconsolidated co-investments	15,483			15,766			45,304			47,345
Noncontrolling interest related to Operating Partnership units	3,464			2,789			10,863			9,381
Depreciation attributable to third party ownership and other	(242		)	(234		)	(708		)	(699		)
Funds from operations attributable to common stockholders and unitholders	$	238,849		$	220,148		$	694,364		$	665,403
Funds from operations attributable to common stockholders and unitholders per share - diluted	$	3.50		$	3.22		$	10.19		$	9.74
Non-core items:
Expensed acquisition and investment related costs	13			31			69			156
Deferred tax expense on unrealized gain on unconsolidated co-investment (1)	1,457			—			1,457			—
(Gain) loss on sale of marketable securities	(239		)	(120		)	(737		)	(669		)
Unrealized losses (gains) on marketable securities	174			(1,180		)	(4,280		)	(426		)
Equity income from non-core co-investment (2)	(4,247		)	—			(4,561		)	—
Interest rate hedge ineffectiveness (3)	—			(35		)	181			61
Gain on early retirement of debt, net	(5,475		)	—			(7,143		)	—
Gain on early retirement of debt from unconsolidated co-investment	—			(3,662		)	—			(3,662		)
Co-investment promote income	—			—			(809		)	(20,541		)
Income from early redemption of preferred equity investments	(1,699		)	—			(2,531		)	(1,602		)
General and administrative and other, net	—			141			—			2,574
Insurance reimbursements and legal settlements, net	(15		)	(111		)	(263		)	(561		)
Core Funds from Operations attributable to common stockholders and unitholders	$	228,818		$	215,212		$	675,747		$	640,733
Core Funds from Operations attributable to common stockholders and unitholders per share-diluted	$	3.35		$	3.15		$	9.92		$	9.38
Weighted average number shares outstanding, diluted (4)	68,229,823			68,339,057			68,117,569			68,328,370

(1) A deferred tax expense was recorded during the third quarter of 2019 related to the $4.4 million net unrealized gain on the Real Estate Technology Ventures, L.P. co-investment discussed below.

(2) Represents the Company's share of co-investment income from Real Estate Technology Ventures, L.P. Income for the third quarter of 2019 includes a net unrealized gain of $4.4 million.

(3) Interest rate swaps generally are adjusted to fair value through other comprehensive income (loss). However, because certain of the Company's interest rate swaps do not have a 0% LIBOR floor, while related hedged debt in these cases is subject to a 0% LIBOR floor, the portion of the change in fair value of these interest rate swaps attributable to this mismatch, if any, is recorded as a non-cash interest rate hedge ineffectiveness through interest expense. On January 1, 2019, the Company adopted ASU No. 2017-12 "Derivatives and Hedging - Targeted Improvements to Accounting for Hedging Activities," which resulted in a cumulative effect adjustment of approximately $181,000 from interest expense to accumulated other comprehensive income.

(4) Assumes conversion of all outstanding operating partnership interests in the Operating Partnership into shares of the Company's common stock and excludes all DownREIT limited partnership units for which the Operating Partnership has the ability and intention to redeem the units for cash and does not consider them to be common stock equivalents.

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Net Operating Income

Net operating income ("NOI") and Same-Property NOI are considered by management to be an important supplemental performance measure to earnings from operations included in the Company’s condensed consolidated statements of income and comprehensive income. The presentation of Same-Property NOI assists with the presentation of the Company’s operations prior to the allocation of depreciation and any corporate-level or financing-related costs. NOI reflects the operating performance of a community and allows for an easy comparison of the operating performance of individual communities or groups of communities. In addition, because prospective buyers of real estate have different financing and overhead structures, with varying marginal impacts to overhead by acquiring real estate, NOI is considered by many in the real estate industry to be a useful measure for determining the value of a real estate asset or group of assets. The Company defines Same-Property NOI as Same-Property revenues less Same-Property operating expenses, including property taxes. Please see the reconciliation of earnings from operations to NOI and Same-Property NOI, which in the table below is the NOI for stabilized properties consolidated by the Company for the periods presented ($ in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Earnings from operations	$	124,039		$	113,897		$	364,294		$	362,960
Adjustments:
Corporate-level property management expenses	8,255			7,761			24,620			23,313
Depreciation and amortization	120,809			120,852			360,842			359,287
Management and other fees from affiliates	(2,428		)	(2,307		)	(7,023		)	(6,812		)
General and administrative	11,345			10,601			38,731			36,539
Expensed acquisition and investment related costs	13			31			69			156
Gain on sale of real estate and land	—			—			—			(22,244		)
NOI	262,033			250,835			781,533			753,199
Less: Non-Same Property NOI	(16,521		)	(12,640		)	(45,218		)	(40,526		)
Same-Property NOI	$	245,512		$	238,195		$	736,315		$	712,673

Item 3: Quantitative and Qualitative Disclosures About Market Risks

Interest Rate Hedging Activities

The Company’s objective in using derivatives is to add stability to interest expense and to manage its exposure to interest rate movements or other identified risks. To accomplish this objective, the Company uses interest rate swaps as part of its cash flow hedging strategy. As of September 30, 2019, the Company has entered into five interest rate swap contracts to mitigate the risk of changes in the interest-related cash outflows on $175.0 million of the Company's unsecured term debt. As of September 30, 2019, the Company also had $269.2 million of secured variable rate indebtedness, of which $9.9 million is subject to interest rate cap protection. All of the Company's interest rate swaps are designated as cash flow hedges as of September 30, 2019. The following table summarizes the notional amount, carrying value, and estimated fair value of the Company’s cash flow hedge derivative instruments used to hedge interest rates as of September 30, 2019. The notional amount represents the aggregate amount of a particular security that is currently hedged at one time, but does not represent exposure to credit, interest rates, or market risks. The table also includes a sensitivity analysis to demonstrate the impact on the Company’s derivative instruments from an increase or decrease in 10-year Treasury bill interest rates by 50 basis points, as of September 30, 2019.

				Carrying and		Estimated Carrying Value
	Notional		Maturity	Estimated		+50		-50
($ in thousands)	Amount		Date Range	Fair Value		Basis Points		Basis Points
Cash flow hedges:
Interest rate swaps	$	175,000	2022	$	470	$	2,439	$	(1,529	)
Interest rate caps	9,924		2019	—		—		—
Total cash flow hedges	$	184,924	2019-2022	$	470	$	2,439	$	(1,529	)

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Additionally, the Company has entered into total return swap contracts, with an aggregate notional amount of $255.6 million that effectively convert $255.6 million of fixed mortgage notes payable to a floating interest rate based on the SIFMA plus a spread and have a carrying value of zero at September 30, 2019. The Company is exposed to insignificant interest rate risk on these swaps as the related mortgages are callable, at par, by the Company, co-terminus with the termination of any related swap. These derivatives do not qualify for hedge accounting.

Interest Rate Sensitive Liabilities

The Company is exposed to interest rate changes primarily as a result of its lines of credit and long-term debt used to maintain liquidity and fund capital expenditures and expansion of the Company's real estate investment portfolio and operations. The Company’s interest rate risk management objective is to limit the impact of interest rate changes on earnings and cash flows and to lower its overall borrowing costs. To achieve its objectives, the Company borrows primarily at fixed rates and may enter into derivative financial instruments such as interest rate swaps, caps, and treasury locks in order to mitigate its interest rate risk on a related financial instrument. The Company does not enter into derivative or interest rate transactions for speculative purposes.

The Company’s interest rate risk is monitored using a variety of techniques. The table below presents the principal amounts and weighted average interest rates by year of expected maturity to evaluate the expected cash flows.

For the Years Ended	2019			2020		2021		2022		2023		Thereafter		Total			Fair value
($ in thousands, except for interest rates)
Fixed rate debt	$	78,225		407,412		544,824		342,408		602,093		3,269,061		$	5,244,023		$	5,472,591
Average interest rate	5.0		%	5.8	%	4.5	%	3.8	%	3.7	%	3.8	%	4.0		%
Variable rate debt (1)	$	154		652		713		570,780		852		266,031		$	839,182		$	833,640
Average interest rate	2.5		%	2.5	%	2.5	%	2.9	%	2.5	%	2.4	%	2.7		%

(1) $175.0 million is subject to interest rate swap agreements, $9.9 million is subject to interest rate caps, and $255.6 million is subject to total return swaps.

The table incorporates only those exposures that exist as of September 30, 2019. It does not consider those exposures or positions that could arise after that date. As a result, the Company's ultimate realized gain or loss, with respect to interest rate fluctuations and hedging strategies would depend on the exposures that arise prior to settlement.

Item 4: Controls and Procedures

Essex Property Trust, Inc.

As of September 30, 2019, Essex carried out an evaluation, under the supervision and with the participation of management, including Essex’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of Essex's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based upon that evaluation, Essex’s Chief Executive Officer and Chief Financial Officer concluded that as of September 30, 2019, Essex's disclosure controls and procedures were effective to ensure that the information required to be disclosed by Essex in the reports that Essex files or submits under the Exchange Act was recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and that such disclosure controls and procedures were also effective to ensure that information required to be disclosed in the reports that Essex files or submits under the Exchange Act is accumulated and communicated to Essex’s management, including Essex’s Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

There were no changes in Essex's internal control over financial reporting, that occurred during the quarter ended September 30, 2019, that have materially affected, or are reasonably likely to materially affect, Essex’s internal control over financial reporting.

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Essex Portfolio, L.P.

As of September 30, 2019, the Operating Partnership carried out an evaluation, under the supervision and with the participation of management, including Essex's Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Operating Partnership's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that as of September 30, 2019, the Operating Partnership's disclosure controls and procedures were effective to ensure that the information required to be disclosed by the Operating Partnership in the reports that the Operating Partnership files or submits under the Exchange Act was recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and that such disclosure controls and procedures were also effective to ensure that information required to be disclosed in the reports that the Operating Partnership files or submits under the Exchange Act is accumulated and communicated to the Operating Partnership’s management, including Essex's Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

There were no changes in the Operating Partnership's internal control over financial reporting, that occurred during the quarter ended September 30, 2019, that have materially affected, or are reasonably likely to materially affect, the Operating Partnership’s internal control over financial reporting.

Part II -- Other Information

Item 1: Legal Proceedings

The Company is subject to various lawsuits in the normal course of its business operations. While the resolution of any such matter cannot be predicted with certainty, the Company is not currently a party to any legal proceedings nor is any legal proceeding currently threatened against the Company that the Company believes, individually or in the aggregate, would have a material adverse effect on the Company's financial condition, results of operations or cash flows.

Item 1A: Risk Factors

In addition to the other information set forth in this quarterly report on Form 10-Q, you should carefully consider the factors discussed in "Part I. Item A. Risk Factors" in the Company's annual report on Form 10-K for the year ended December 31, 2018, which could materially affect the Company's financial condition, results of operations or cash flows. There have been no material changes to the Risk Factors disclosed in Item 1A of the Company's annual report on Form 10-K for the year ended December 31, 2018, as filed with the SEC and available at www.sec.gov. The risks described in the Company's annual report on Form 10-K are not the only risks facing the Company. Additional risks and uncertainties not currently known or that the Company currently deems to be immaterial may also materially adversely affect the Company's financial condition, results of operations or cash flows.

Item 2: Unregistered Sales of Equity Securities and Use of Proceeds

Unregistered Sales of Equity Securities; Essex Portfolio, L.P.

During the three months ended September 30, 2019, the Operating Partnership issued OP Units in private placements in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act, in the amounts and for the consideration set forth below:

During the three months ended September 30, 2019, Essex issued an aggregate of 354,827 shares of its common stock upon the exercise of stock options, the vesting of restricted stock awards, the exchange of OP Units and DownREIT limited partnership units, and the issuances of common stock into the public market pursuant to its equity distribution program. Essex contributed the net proceeds of $100.3 million from the option exercises and issuances of common stock pursuant to its equity distribution program during the three months ended September 30, 2019 to the Operating Partnership in exchange for an aggregate of 353,827 OP Units, as required by the Operating Partnership’s partnership agreement. Furthermore, for each share of common stock issued by Essex in connection with vesting of restricted stock awards and the exchange of OP Units and DownREIT limited partnership units, the Operating Partnership issued OP Units to Essex, as required by the partnership agreement. During the three months ended September 30, 2019, 1,000 OP Units were issued to Essex pursuant to this mechanism.

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Stock Repurchases

In February 2019, the board of directors approved the replenishment of the Company's stock repurchase plan such that, as of such date, the Company had $250.0 million of purchase authority remaining under the replenished plan. As a result of the replenishment, as of September 30, 2019, the Company had $250.0 million of purchase authority remaining under the stock repurchase plan. The Company did not repurchase any of its common stock during the three months ended September 30, 2019.

Item 3: Defaults Upon Senior Securities

None.

Item 4: Mine Safety Disclosures

Not applicable.

Item 5: Other Information

None.

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Item 6: Exhibits

 

A. Exhibits
4.1	Indenture, dated August 7, 2019, among Essex Portfolio, L.P., Essex Property Trust, Inc., and U.S. Bank National Association, as trustee, including the form of 3.000% Senior Notes due 2030 and the guarantee thereof, attached as Exhibit 4.1 to the Company's Current Report on Form 8-K, filed August 7, 2019, and incorporated herein by reference.
10.1	Executive Transition Services Agreement, effective as of September 5, 2019, by and between Essex Property Trust, Inc. and Craig K. Zimmerman, attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed September 6, 2019, and incorporated herein by reference.
31.1*	Certification of Michael J. Schall, Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of Angela L. Kleiman, Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.3*	Certification of Michael J. Schall, Principal Executive Officer of General Partner, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.4*	Certification of Angela L. Kleiman, Principal Financial Officer of General Partner, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*	Certification of Michael J. Schall, Chief Executive Officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**
32.2*	Certification of Angela L. Kleiman, Chief Financial Officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**
32.3*	Certification of Michael J. Schall, Principal Executive Officer of General Partner, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**
32.4*	Certification of Angela L. Kleiman, Principal Financial Officer of General Partner, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**
101.INS	XBRL Instance Document - the Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

* Filed or furnished herewith.

** In accordance with Item 601(b)(32) of Regulation S-K, this Exhibit is not deemed "filed" for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section. Such certifications will not be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrants have duly caused this report to be signed on their behalf by the undersigned thereunto duly authorized.

                    

ESSEX PROPERTY TRUST, INC.

(Registrant)

Date: October 24, 2019

By: /s/ ANGELA L. KLEIMAN

Angela L. Kleiman

Executive Vice President and Chief Financial Officer

(Authorized Officer, Principal Financial Officer)

Date: October 24, 2019

By: /s/ JOHN FARIAS

John Farias

Senior Vice President and Chief Accounting Officer

ESSEX PORTFOLIO, L.P.

By Essex Property Trust, Inc., its general partner

(Registrant)

Date: October 24, 2019

By: /s/ ANGELA L. KLEIMAN

Angela L. Kleiman

Executive Vice President and Chief Financial Officer

(Authorized Officer, Principal Financial Officer)

Date: October 24, 2019

By: /s/ JOHN FARIAS

John Farias

Senior Vice President and Chief Accounting Officer

55

EX-31.1

EXHIBIT 31.1

ESSEX PROPERTY TRUST, INC.

Certification of Chief Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Michael J. Schall, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Essex Property Trust, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:October 24, 2019

/s/ Michael J. Schall

Michael J. Schall

Chief Executive Officer and President

Essex Property Trust, Inc.

EX-31.2

EXHIBIT 31.2

ESSEX PROPERTY TRUST, INC.

Certification of Chief Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Angela L. Kleiman, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Essex Property Trust, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:October 24, 2019

/s/ Angela L. Kleiman

Angela L. Kleiman

Executive Vice President and Chief Financial Officer

Essex Property Trust, Inc.

EX-31.3

EXHIBIT 31.3

ESSEX PORTFOLIO, L.P.

Certification of Chief Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Michael J. Schall, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Essex Portfolio, L.P.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:October 24, 2019

/s/ Michael J. Schall

Michael J. Schall

Chief Executive Officer and President

Essex Property Trust, Inc., general partner of

Essex Portfolio, L.P.

EX-31.4

EXHIBIT 31.4

ESSEX PORTFOLIO, L.P.

Certification of Chief Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Angela L. Kleiman, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Essex Portfolio, L.P.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:October 24, 2019

/s/ Angela L. Kleiman

Angela L. Kleiman

Executive Vice President and Chief Financial Officer

Essex Property Trust, Inc., general partner of

Essex Portfolio, L.P.

EX-32.1

Exhibit 32.1

ESSEX PROPERTY TRUST, INC.

Certification of Chief Executive Officer

Pursuant to 18 U.S.C. Section 1350 as adopted

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Subsections (a) and (b) of Section 1350, chapter 63 of title 18, United States Code), I, Michael J. Schall, hereby certify, to the best of my knowledge, that the Quarterly Report on Form 10-Q for the period ended September 30, 2019 (the “Form 10-Q”) of Essex Property Trust, Inc. fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Essex Property Trust, Inc.

Date: October 24, 2019	/s/ Michael J. Schall
	Michael J. Schall
	Chief Executive Officer and President
	Essex Property Trust, Inc.

EX-32.2

Exhibit 32.2

ESSEX PROPERTY TRUST, INC.

Certification of Chief Financial Officer

Pursuant to 18 U.S.C. Section 1350 as adopted

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Subsections (a) and (b) of Section 1350, chapter 63 of title 18, United States Code), I, Angela L. Kleiman, hereby certify, to the best of my knowledge, that the Quarterly Report on Form 10-Q for the period ended September 30, 2019 (the “Form 10-Q”) of Essex Property Trust, Inc. fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Essex Property Trust, Inc.

Date: October 24, 2019	/s/ Angela L. Kleiman
	Angela L. Kleiman
	Executive Vice President and Chief Financial Officer
	Essex Property Trust, Inc.

EX-32.3

Exhibit 32.3

ESSEX PORTFOLIO, L.P.

Certification of Chief Executive Officer

Pursuant to 18 U.S.C. Section 1350 as adopted

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Subsections (a) and (b) of Section 1350, chapter 63 of title 18, United States Code), I, Michael J. Schall, hereby certify, to the best of my knowledge, that the Quarterly Report on Form 10-Q for the period ended September 30, 2019 (the “Form 10-Q”) of Essex Portfolio, L.P. fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Essex Portfolio, L.P.

Date: October 24, 2019	­­/s/ Michael J. Schall
	Michael J. Schall
	Chief Executive Officer and President
	Essex Property Trust, Inc., general partner of
	Essex Portfolio, L.P.

EX-32.4

Exhibit 32.4

ESSEX PORTFOLIO, L.P.

Certification of Chief Financial Officer

Pursuant to 18 U.S.C. Section 1350 as adopted

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Subsections (a) and (b) of Section 1350, chapter 63 of title 18, United States Code), I, Angela L. Kleiman, hereby certify, to the best of my knowledge, that the Quarterly Report on Form 10-Q for the period ended September 30, 2019 (the “Form 10-Q”) of Essex Portfolio, L.P. fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Essex Portfolio, L.P.

Date: October 24, 2019	­­­­­/s/ Angela L. Kleiman
	Angela L. Kleiman
	Executive Vice President and Chief Financial Officer
	Essex Property Trust, Inc., general partner of
	Essex Portfolio, L.P.

XML

Co-investments - Summary of Investments (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2019	Dec. 31, 2018
Schedule of Equity Method Investments [Line Items]
Co-investments	$ 1,413,861	$ 1,300,140
Total operating and other co-investments, net [Member]
Schedule of Equity Method Investments [Line Items]
Co-investments	$ 863,844	833,270
Membership Interest In CPPIB [Member]
Schedule of Equity Method Investments [Line Items]
Limited partnership interest in partnership investments	54.00%
Co-investments	$ 469,288	482,507
Membership interest in Wesco I, III, IV, and V [Member]
Schedule of Equity Method Investments [Line Items]
Limited partnership interest in partnership investments	52.00%
Co-investments	$ 212,808	194,890
Membership interest in BEXAEW, BEX II And BEX III [Member]
Schedule of Equity Method Investments [Line Items]
Limited partnership interest in partnership investments	50.00%
Co-investments	$ 161,467	121,780
Membership In Other [Member]
Schedule of Equity Method Investments [Line Items]
Limited partnership interest in partnership investments	48.00%
Co-investments	$ 20,281	34,093
Total development co-investments, net [Member]
Schedule of Equity Method Investments [Line Items]
Limited partnership interest in partnership investments	50.00%
Co-investments	$ 137,626	94,060
Total preferred interest co-investments [Member]
Schedule of Equity Method Investments [Line Items]
Co-investments	412,391	372,810
Total preferred interest co-investments [Member] | Investments in Majority-owned Subsidiaries [Member]
Schedule of Equity Method Investments [Line Items]
Co-investments	$ 70,900	$ 51,800

XML

Debt - Debt Summary (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2019	Dec. 31, 2018
Debt Instrument [Line Items]
Unsecured debt, net	$ 4,686,171	$ 3,799,316
Lines of credit	220,000	0
Mortgage notes payable, net	1,141,970	1,806,626
Total debt	6,048,141	5,605,942
Unsecured bonds private placement - fixed rate [Member]
Debt Instrument [Line Items]
Unsecured debt, net	$ 274,772	274,624
Debt, weighted average maturity (years)	1 year 3 months 18 days
Term loan - variable rate [Member]
Debt Instrument [Line Items]
Unsecured debt, net	$ 349,088	$ 348,813
Debt, weighted average maturity (years)	2 years 4 months 24 days
Weighted average interest rate	2.90%	3.00%
Bonds public offering - fixed rate [Member]
Debt Instrument [Line Items]
Unsecured debt, net	$ 4,062,311	$ 3,175,879
Debt, weighted average maturity (years)	7 years 7 months 6 days
Weighted average interest rate	3.80%	3.90%
Unsecured Line of Credit [Member]
Debt Instrument [Line Items]
Lines of credit	$ 220,000	$ 0
Weighted average interest rate	2.80%	3.20%
Mortgage notes payable, net [Member]
Debt Instrument [Line Items]
Debt, weighted average maturity (years)	6 years 9 months 18 days
Mortgage notes payable, net	$ 1,141,970	$ 1,806,626
Weighted average interest rate	4.30%	4.30%

XML

Revenues (Tables)

9 Months Ended

Sep. 30, 2019

Revenue from Contract with Customer [Abstract]

Disaggregation of revenue

The following table presents the Company’s revenues disaggregated by revenue source ($ in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Rental income (1)	$	358,001	$	342,246	$	1,058,973	$	1,021,742
Other property (1)	6,503		6,364		18,794		18,341
Management and other fees from affiliates	2,428		2,307		7,023		6,812
Total revenues	$	366,932	$	350,917	$	1,084,790	$	1,046,895

(1) On January 1, 2019, the Company adopted ASU No. 2016-02 “Leases.” As a result of this adoption certain amounts previously classified as other property revenue have been reclassified to rental income. Prior period amounts have been adjusted to conform to the current period’s presentation.

The following table presents the Company’s rental and other property-related revenues disaggregated by geographic operating segment ($ in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Southern California	$	152,312	$	148,575	455,302		442,382
Northern California	144,124		131,538		420,544		389,750
Seattle Metro	61,657		59,231		182,738		176,740
Other real estate assets (1)	6,411		9,266		19,183		31,211
Total rental and other property revenues	$	364,504	$	348,610	$	1,077,767	$	1,040,083

(1) Other real estate assets consists of revenues generated from retail space, commercial properties, held for sale properties, and disposition properties.

The following table presents the Company’s rental and other property-related revenues disaggregated by current property category status ($ in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Same-property (1)	$	342,115	$	331,695	$	1,019,509	$	987,564
Acquisitions (2)	7,309		—		14,416		—
Development (3)	1,859		1,091		4,184		1,560
Redevelopment	5,255		5,125		15,690		15,185
Non-residential/other, net (4)	7,966		10,699		23,968		35,774
Total rental and other property revenues	$	364,504	$	348,610	$	1,077,767	$	1,040,083

(1) Properties that have stabilized operations as of January 1, 2018 and are consolidated by the Company for the three and nine months ended September 30, 2019 and 2018. A community is generally considered to have reached stabilized operations once it achieves an initial occupancy of 95%.

(2) Acquisitions includes properties acquired which did not have comparable stabilized results as of January 1, 2018.

(3) Development includes properties developed which did not have stabilized results as of January 1, 2018.

(4) Non-residential/other, net consists of revenues generated from retail space, commercial properties, held for sale properties, disposition properties and student housing.

XML

Lease Agreements - Company as Lessee

9 Months Ended

Sep. 30, 2019

Leases [Abstract]

Lease Agreements - Company as Lessee

Lease Agreements - Company as Lessee

As of September 30, 2019, the Company is a lessee of corporate office space, ground leases and a parking lease associated with various consolidated properties, and equipment. Lease terms for the Company's office leases, in general, range between five to 10 years while ground leases and the parking lease have terms typically ranging from 20 to 85 years. The corporate office leases occasionally contain renewal options of approximately five years while certain ground leases contain renewal options that can extend the lease term from approximately 10 to 39 years.

A majority of the Company’s ground leases and the parking lease are subject to changes in the Consumer Price Index ("CPI"). Furthermore, certain of the Company’s ground leases include rental payments based on a percentage of gross or net income. While lease liabilities are not remeasured as a result of changes in the CPI or percentage of gross or net income, such changes are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred.

The Company’s lease agreements do not contain any residual value guarantees or restrictive covenants.

Operating lease right-of-use assets and operating lease liabilities are recognized based on the present value of lease payments over the lease term at commencement date. Because most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

As of September 30, 2019 and December 31, 2018, the Company had no material finance leases.

Supplemental condensed consolidated balance sheet information related to leases as of September 30, 2019 is as follows ($ in thousands):

	Classification	September 30, 2019
Assets
Operating lease right-of-use assets	Operating lease right-of-use assets	$	75,478
Total leased assets		$	75,478
Liabilities
Operating lease liabilities	Operating lease liabilities	77,495
Total lease liabilities		$	77,495

The components of lease expense for the three and nine months ended September 30, 2019 were as follows ($ in thousands):

	Three Months Ended September 30, 2019			Nine Months Ended September 30, 2019
Operating lease cost	$	1,686		$	5,059
Variable lease cost	109			622
Short-term lease cost	171			455
Sublease income	(109		)	(326		)
Total lease cost	$	1,857		$	5,810

A maturity analysis of lease liabilities as of September 30, 2019 are as follows ($ in thousands):

	Operating Leases
Remaining in 2019	$	1,717
2020	6,855
2021	6,877
2022	6,888
2023	6,860
Thereafter	153,258
Total lease payments	$	182,455
Less: Imputed interest	(104,960		)
Present Value of lease liabilities	$	77,495

Lease term and discount rate information for leases at September 30, 2019 are as follows:

Weighted-average of remaining lease terms (years)
Operating Leases	39
Weighted-average of discount rates
Operating Leases	4.99	%

As of December 31, 2018, in accordance with previously applicable lease accounting guidance, ASC 840, the total minimum lease commitments under operating leases was as follows ($ in thousands):

	Future Minimum Rent
2019	$	6,811
2020	6,855
2021	6,877
2022	6,888
2023	6,860
Thereafter	153,258
	$	187,549

Practical Expedients

As part of the transition to ASC 842, the Company elected to use the modified retrospective transition method with the new standard being applied as of the January 1, 2019 adoption date. Additionally, the Company has elected, as of the adoption date, not to reassess whether expired or existing contracts contain leases under the new definition of a lease, not to reassess the lease classification for expired or existing leases, not to reassess whether previously capitalized initial direct costs would qualify for capitalization under ASC 842, and not to reassess whether existing or expired land easements meet the definition of a lease.

Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company recognizes the lease expense for such leases on a straight-line basis over the lease term.

The Company has elected to account for lease components (e.g., fixed payments including rent) and non-lease components (e.g., common-area maintenance costs) as a single combined lease component as the lease components are the predominant elements of the combined components.

XML

Lease Agreements - Company as Lessee (Tables)

9 Months Ended

Sep. 30, 2019

Leases [Abstract]

Schedule of Information Related to Leases

Supplemental condensed consolidated balance sheet information related to leases as of September 30, 2019 is as follows ($ in thousands):

	Classification	September 30, 2019
Assets
Operating lease right-of-use assets	Operating lease right-of-use assets	$	75,478
Total leased assets		$	75,478
Liabilities
Operating lease liabilities	Operating lease liabilities	77,495
Total lease liabilities		$	77,495

Schedule of Components of Lease Expense

The components of lease expense for the three and nine months ended September 30, 2019 were as follows ($ in thousands):

	Three Months Ended September 30, 2019			Nine Months Ended September 30, 2019
Operating lease cost	$	1,686		$	5,059
Variable lease cost	109			622
Short-term lease cost	171			455
Sublease income	(109		)	(326		)
Total lease cost	$	1,857		$	5,810

Lease term and discount rate information for leases at September 30, 2019 are as follows:

Weighted-average of remaining lease terms (years)
Operating Leases	39
Weighted-average of discount rates
Operating Leases	4.99	%

Schedule of Maturity Analysis of Operating Lease Liabilities

A maturity analysis of lease liabilities as of September 30, 2019 are as follows ($ in thousands):

	Operating Leases
Remaining in 2019	$	1,717
2020	6,855
2021	6,877
2022	6,888
2023	6,860
Thereafter	153,258
Total lease payments	$	182,455
Less: Imputed interest	(104,960		)
Present Value of lease liabilities	$	77,495

Schedule of Future Minimum Rental Payments for Operating Leases

As of December 31, 2018, in accordance with previously applicable lease accounting guidance, ASC 840, the total minimum lease commitments under operating leases was as follows ($ in thousands):

	Future Minimum Rent
2019	$	6,811
2020	6,855
2021	6,877
2022	6,888
2023	6,860
Thereafter	153,258
	$	187,549

XML

Organization and Basis of Presentation - Accumulated Other Comprehensive Loss - Partnership (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2019	Dec. 31, 2018
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Balance at period beginning	$ 6,393,844
Balance at period end	6,415,004
Essex Portfolio, L.P. [Member] | Accumulated Other Comprehensive Loss, Net [Member]
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Balance at period beginning	(9,738)
Cumulative effect upon adoption of ASU No. 2017-12		$ 181
Other comprehensive (loss) income before reclassification	(303)
Amounts reclassified from accumulated other comprehensive loss	(5,892)
Other comprehensive income	(6,014)
Balance at period end	(15,752)
Essex Portfolio, L.P. [Member] | Change in Fair Value and Amortization of Swap Settlements [Member]
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Balance at period beginning	(9,593)
Cumulative effect upon adoption of ASU No. 2017-12		181
Other comprehensive (loss) income before reclassification	(506)
Amounts reclassified from accumulated other comprehensive loss	(5,860)
Other comprehensive income	(6,185)
Balance at period end	(15,778)
Essex Portfolio, L.P. [Member] | Unrealized Gains/(Loss) on Available for Sale Securities [Member]
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Balance at period beginning	(145)
Cumulative effect upon adoption of ASU No. 2017-12		$ 0
Other comprehensive (loss) income before reclassification	203
Amounts reclassified from accumulated other comprehensive loss	(32)
Other comprehensive income	171
Balance at period end	$ 26

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Co-investments

9 Months Ended

Sep. 30, 2019

Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures [Abstract]

Co-investments

Co-investments

The Company has joint ventures and preferred equity investments in co-investments which are accounted for under the equity method. The co-investments, including BEXAEW, BEX II, BEX III, and BEX IV, the Canadian Pension Plan Investment Board ("CPPIB"), Wesco I, LLC ("Wesco I"), Wesco III, LLC ("Wesco III"), Wesco IV, LLC ("Wesco IV"), and Wesco V, LLC ("Wesco V"), own, operate, and develop apartment communities. The carrying values of the Company's co-investments as of September 30, 2019 and December 31, 2018 are as follows ($ in thousands, except parenthetical amounts):

	Weighted Average Company Ownership Percentage (1)		September 30, 2019		December 31, 2018
Ownership interest in:
CPPIB	54	%	$	469,288	$	482,507
Wesco I, Wesco III, Wesco IV, and Wesco V	52	%	212,808		194,890
BEXAEW, BEX II, BEX III, and BEX IV	50	%	161,467		121,780
Other	48	%	20,281		34,093
Total operating and other co-investments, net			863,844		833,270
Total pre-development and development co-investments	50	%	137,626		94,060
Total preferred interest co-investments (includes related party investments of $70.9 million and $51.8 million as of September 30, 2019 and December 31, 2018, respectively)			412,391		372,810
Total co-investments, net			$	1,413,861	$	1,300,140

(1) Weighted average Company ownership percentages are as of September 30, 2019.

The combined summarized entity financial information of co-investments is as follows ($ in thousands):

	September 30, 2019		December 31, 2018
Combined balance sheets: (1)
Rental properties and real estate under development	$	4,779,685	$	4,367,987
Other assets	110,364		104,119
Total assets	$	4,890,049	$	4,472,106
Debt	$	2,316,618	$	2,190,764
Other liabilities	146,643		106,316
Equity	2,426,788		2,175,026
Total liabilities and equity	$	4,890,049	$	4,472,106
Company's share of equity	$	1,413,861	$	1,300,140

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Combined statements of income: (1)
Property revenues	$	84,071		$	84,820		$	249,628		$	247,010
Property operating expenses	(29,214		)	(27,779		)	(85,768		)	(81,415		)
Net operating income	54,857			57,041			163,860			165,595
Interest expense	(16,089		)	(15,805		)	(47,284		)	(46,179		)
General and administrative	(2,603		)	(1,254		)	(6,774		)	(5,134		)
Depreciation and amortization	(30,411		)	(32,833		)	(89,283		)	(95,312		)
Net income	$	5,754		$	7,149		$	20,519		$	18,970
Company's share of net income (2)	$	21,700		$	16,788		$	54,935		$	64,611

(1) Includes preferred equity investments held by the Company.

(2) Includes the Company's share of equity income from joint ventures and preferred equity investments, gain on sales of co-investments, co-investment promote income and income from early redemption of preferred equity investments. Includes related party income of $2.0 million and $0.7 million for the three months ended September 30, 2019 and 2018, respectively, and $5.5 million and $1.4 million for the nine months ended September 30, 2019 and 2018, respectively.

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Condensed Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Interest capitalized	$ 19.0	$ 13.3
Essex Portfolio, L.P. [Member]
Interest capitalized	$ 19.0	$ 13.3

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Segment Information

9 Months Ended

Sep. 30, 2019

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. The Company's chief operating decision makers are comprised of several members of its executive management team who use net operating income ("NOI") to assess the performance of the business for the Company's reportable operating segments. NOI represents total property revenues less direct property operating expenses.

The executive management team generally 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 NOI are management and other fees from affiliates and interest and other income. Non-segment revenues and NOI included in the following schedule also consist of revenues generated from commercial properties and properties that have been sold. Other non-segment assets include items such as 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 NOI for each of the reportable operating segments are summarized as follows for the three and nine months ended September 30, 2019 and 2018 ($ in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Revenues:
Southern California	$	152,312		$	148,575		$	455,302		$	442,382
Northern California	144,124			131,538			420,544			389,750
Seattle Metro	61,657			59,231			182,738			176,740
Other real estate assets	6,411			9,266			19,183			31,211
Total property revenues	$	364,504		$	348,610		$	1,077,767		$	1,040,083
Net operating income:
Southern California	$	106,951		$	104,732		$	323,073		$	314,977
Northern California	105,381			97,244			310,407			288,222
Seattle Metro	43,701			40,999			129,013			123,432
Other real estate assets	6,000			7,860			19,040			26,568
Total net operating income	262,033			250,835			781,533			753,199
Management and other fees from affiliates	2,428			2,307			7,023			6,812
Corporate-level property management expenses	(8,255		)	(7,761		)	(24,620		)	(23,313		)
Depreciation and amortization	(120,809		)	(120,852		)	(360,842		)	(359,287		)
General and administrative	(11,345		)	(10,601		)	(38,731		)	(36,539		)
Expensed acquisition and investment related costs	(13		)	(31		)	(69		)	(156		)
Gain on sale of real estate and land	—			—			—			22,244
Interest expense	(54,896		)	(55,196		)	(162,651		)	(166,335		)
Total return swap income	2,154			2,184			6,174			6,682
Interest and other income	8,685			8,437			29,293			21,241
Equity income from co-investments	21,700			16,788			54,935			64,611
Deferred tax expense on unrealized gain on unconsolidated co-investment	(1,457		)	—			(1,457		)	—
Gain on early retirement of debt, net	5,475			—			7,143			—
Gain on remeasurement of co-investment	—			—			31,535			—
Net income	$	105,700		$	86,110		$	329,266		$	289,159

Total assets for each of the reportable operating segments are summarized as follows as of September 30, 2019 and December 31, 2018 ($ in thousands):

	September 30, 2019		December 31, 2018
Assets:
Southern California	$	4,245,335	$	4,350,377
Northern California	4,623,559		4,270,238
Seattle Metro	1,444,045		1,472,916
Other real estate assets	66,579		63,022
Net reportable operating segment - real estate assets	10,379,518		10,156,553
Real estate under development	562,338		454,629
Co-investments	1,413,861		1,300,140
Cash and cash equivalents, including restricted cash	91,726		151,395
Marketable securities	216,894		209,545
Notes and other receivables	216,541		71,895
Operating lease right-of-use assets	75,478		—
Prepaid expenses and other assets	41,536		39,439
Total assets	$	12,997,892	$	12,383,596

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Condensed Consolidated Statements of Income and Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Revenues:
Total revenues	$ 366,932	$ 350,917	$ 1,084,790	$ 1,046,895
Expenses:
Property operating, excluding real estate taxes	63,181	59,100	181,241	174,461
Real estate taxes	39,290	38,675	114,993	112,423
Corporate-level property management expenses	8,255	7,761	24,620	23,313
Depreciation and amortization	120,809	120,852	360,842	359,287
General and administrative	11,345	10,601	38,731	36,539
Expensed acquisition and investment related costs	13	31	69	156
Total expenses	242,893	237,020	720,496	706,179
Gain on sale of real estate and land	0	0	0	22,244
Earnings from operations	124,039	113,897	364,294	362,960
Interest expense	(54,896)	(55,196)	(162,651)	(166,335)
Total return swap income	2,154	2,184	6,174	6,682
Interest and other income	8,685	8,437	29,293	21,241
Equity income from co-investments	21,700	16,788	54,935	64,611
Deferred tax expense on unrealized gain on unconsolidated co-investment	(1,457)	0	(1,457)	0
Gain on early retirement of debt, net	5,475	0	7,143	0
Gain on remeasurement of co-investment	0	0	31,535	0
Net income	105,700	86,110	329,266	289,159
Net income attributable to noncontrolling interest	(6,365)	(5,135)	(18,798)	(16,826)
Net income available to common stockholders	99,335	80,975	310,468	272,333
Comprehensive income	105,663	89,100	323,071	301,708
Comprehensive income attributable to noncontrolling interest	(6,364)	(5,235)	(18,589)	(17,243)
Comprehensive income attributable to controlling interest	$ 99,299	$ 83,865	$ 304,482	$ 284,465
Basic:
Net income available to common stockholders/unitholders (in dollars per share)	$ 1.51	$ 1.23	$ 4.72	$ 4.12
Weighted average number of shares/common units outstanding during the period (in shares)	65,850,524	66,052,108	65,757,914	66,047,990
Diluted:
Net income available to common stockholders/unitholders (in dollars per share)	$ 1.51	$ 1.22	$ 4.71	$ 4.12
Weighted average number of shares/common units outstanding during the period (in shares)	65,973,085	66,103,812	65,857,660	66,093,004
Rental and Other Property Revenues [Member]
Revenues:
Total revenues	$ 364,504	$ 348,610	$ 1,077,767	$ 1,040,083
Management and Other Fees From Affiliates Income [Member]
Revenues:
Total revenues	2,428	2,307	7,023	6,812
Essex Portfolio, L.P. [Member]
Revenues:
Total revenues	366,932	350,917	1,084,790	1,046,895
Expenses:
Property operating, excluding real estate taxes	63,181	59,100	181,241	174,461
Real estate taxes	39,290	38,675	114,993	112,423
Corporate-level property management expenses	8,255	7,761	24,620	23,313
Depreciation and amortization	120,809	120,852	360,842	359,287
General and administrative	11,345	10,601	38,731	36,539
Expensed acquisition and investment related costs	13	31	69	156
Total expenses	242,893	237,020	720,496	706,179
Gain on sale of real estate and land	0	0	0	22,244
Earnings from operations	124,039	113,897	364,294	362,960
Interest expense	(54,896)	(55,196)	(162,651)	(166,335)
Total return swap income	2,154	2,184	6,174	6,682
Interest and other income	8,685	8,437	29,293	21,241
Equity income from co-investments	21,700	16,788	54,935	64,611
Deferred tax expense on unrealized gain on unconsolidated co-investment	(1,457)	0	(1,457)	0
Gain on early retirement of debt, net	5,475	0	7,143	0
Gain on remeasurement of co-investment	0	0	31,535	0
Net income	105,700	86,110	329,266	289,159
Net income attributable to noncontrolling interest	(2,901)	(2,346)	(7,935)	(7,445)
Net income available to common stockholders	102,799	83,764	321,331	281,714
Comprehensive income	105,663	89,100	323,071	301,708
Comprehensive income attributable to noncontrolling interest	(2,901)	(2,346)	(7,935)	(7,445)
Comprehensive income attributable to controlling interest	$ 102,762	$ 86,754	$ 315,136	$ 294,263
Basic:
Net income available to common stockholders/unitholders (in dollars per share)	$ 1.51	$ 1.23	$ 4.72	$ 4.12
Weighted average number of shares/common units outstanding during the period (in shares)	68,148,913	68,325,091	68,058,802	68,321,153
Diluted:
Net income available to common stockholders/unitholders (in dollars per share)	$ 1.51	$ 1.23	$ 4.71	$ 4.12
Weighted average number of shares/common units outstanding during the period (in shares)	68,271,474	68,376,795	68,158,548	68,366,167
Essex Portfolio, L.P. [Member] | Rental and Other Property Revenues [Member]
Revenues:
Total revenues	$ 364,504	$ 348,610	$ 1,077,767	$ 1,040,083
Essex Portfolio, L.P. [Member] | Management and Other Fees From Affiliates Income [Member]
Revenues:
Total revenues	$ 2,428	$ 2,307	$ 7,023	$ 6,812

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Condensed Consolidated Statement of Capital (Parenthetical) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Essex Portfolio, L.P. [Member]
Distribution declared (in dollars per share)	$ 1.95	$ 1.86	$ 5.85	$ 5.58

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Lease Agreements - Company as Lessee - Additional Information (Details)	Sep. 30, 2019
Leases [Abstract]
Weighted-average remaining lease term: Operating Leases	39 years
Weighted-average discount rate: Operating Leases	4.99%

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Derivative Instruments and Hedging Activities (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Derivative [Line Items]
Total return swap income	$ 2,154,000	$ 2,184,000	$ 6,174,000	$ 6,682,000
Multifamily Housing Mortgage Revenue Bonds [Member]
Derivative [Line Items]
Bond subject to interest rate caps	255,600,000		255,600,000
Designated as Hedging Instrument [Member] | Interest Rate Swap [Member]
Derivative [Line Items]
Derivative, notional amount	$ 175,000,000.0		$ 175,000,000.0
Interest rate	2.30%		2.30%
Aggregate carrying value of the interest rate swap contracts, asset	$ 500,000		$ 500,000		$ 5,800,000
Designated as Hedging Instrument [Member] | Interest Rate Cap [Member]
Derivative [Line Items]
Aggregate carrying value of the interest rate swap contracts, liability	0		0		0
Not Designated as Hedging Instrument [Member] | Interest Rate Cap [Member]
Derivative [Line Items]
Derivative, notional amount	9,900,000		9,900,000
Not Designated as Hedging Instrument [Member] | Total Return Swap, Callable [Member]
Derivative [Line Items]
Derivative, notional amount	255,600,000		255,600,000
Derivative, fair value, net	$ 0		$ 0		$ 0

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Lease Agreements - Company as Lessor (Tables)

9 Months Ended

Sep. 30, 2019

Leases [Abstract]

Lessor, Future Minimum Base Rent

A maturity analysis of undiscounted future minimum non-cancelable base rent to be received under the above operating leases as of September 30, 2019 is summarized as follows ($ in thousands):

	Future Minimum Rent
Remaining in 2019	$	310,385
2020	489,601
2021	15,105
2022	14,080
2023	12,853
Thereafter	37,940
	$	879,964

Schedule of Property Subject to or Available for Operating Lease

As of December 31, 2018, in accordance with previously applicable lease accounting guidance, Accounting Standards Codification ("ASC") 840, "Leases", the future minimum non-cancelable base rent to be received under one commercial building and commercial portions of mixed use communities, for which the Company was the lessor, was as follows ($ in thousands):

	Future Minimum Rent
2019	$	16,386
2020	15,842
2021	14,412
2022	13,324
2023	12,181
Thereafter	33,034
	$	105,179

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Organization and Basis of Presentation - Accumulated Other Comprehensive Loss Summary (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2019	Dec. 31, 2018
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Balance at period beginning	$ 6,393,844
Balance at period end	6,415,004
Accumulated Other Comprehensive Loss, Net [Member]
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Balance at period beginning	(13,217)
Cumulative effect upon adoption of ASU No. 2017-12		$ 175
Other comprehensive (loss) income before reclassification	(293)
Amounts reclassified from accumulated other comprehensive loss	(5,693)
Other comprehensive income	(5,811)
Balance at period end	(19,028)
Change in Fair Value and Amortization of Swap Settlements [Member]
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Balance at period beginning	(13,077)
Cumulative effect upon adoption of ASU No. 2017-12		175
Other comprehensive (loss) income before reclassification	(490)
Amounts reclassified from accumulated other comprehensive loss	(5,662)
Other comprehensive income	(5,977)
Balance at period end	(19,054)
Unrealized Gains/(Loss) on Available for Sale Securities [Member]
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Balance at period beginning	(140)
Cumulative effect upon adoption of ASU No. 2017-12		$ 0
Other comprehensive (loss) income before reclassification	197
Amounts reclassified from accumulated other comprehensive loss	(31)
Other comprehensive income	166
Balance at period end	$ 26

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Net Income Per Common Share and Net Income Per Common Unit

9 Months Ended

Sep. 30, 2019

Earnings Per Share [Abstract]

Net Income Per Common Share and Net Income Per Common Unit

Net Income Per Common Share and Net Income Per Common Unit

($ in thousands, except share and unit data):

Essex Property Trust, Inc.

	Three Months Ended September 30, 2019					Three Months Ended September 30, 2018
	Income		Weighted- average Common Shares	Per Common Share Amount		Income		Weighted- average Common Shares	Per Common Share Amount
Basic:
Net income available to common stockholders	$	99,335	65,850,524	$	1.51	$	80,975	66,052,108	$	1.23
Effect of Dilutive Securities:
Stock options	—		122,561			—		51,704
Diluted:
Net income available to common stockholders	$	99,335	65,973,085	$	1.51	$	80,975	66,103,812	$	1.22

	Nine Months Ended September 30, 2019					Nine Months Ended September 30, 2018
	Income		Weighted- average Common Shares	Per Common Share Amount		Income		Weighted- average Common Shares	Per Common Share Amount
Basic:
Net income available to common stockholders	$	310,468	65,757,914	$	4.72	$	272,333	66,047,990	$	4.12
Effect of Dilutive Securities:
Stock options	—		99,746			—		45,014
Diluted:
Net income available to common stockholders	$	310,468	65,857,660	$	4.71	$	272,333	66,093,004	$	4.12

The tables above exclude from the calculations of diluted earnings per share weighted average convertible OP Units of 2,298,389 and 2,272,983, which include vested Series Z-1 Incentive Units, 2014 Long-Term Incentive Plan Units, and 2015 Long-Term Incentive Plan Units for the three months ended September 30, 2019 and 2018, respectively, and 2,300,888 and 2,273,163 for the nine months ended September 30, 2019 and 2018, respectively, because they were anti-dilutive. The related income allocated to these convertible OP Units aggregated $3.5 million and $2.8 million for the three months ended September 30, 2019 and 2018, respectively, and $10.9 million and $9.4 million for the nine months ended September 30, 2019 and 2018, respectively. Additionally, the tables exclude all DownREIT limited partnership units for which the Operating Partnership has the ability and intention to redeem the units for cash and does not consider them to be common stock equivalents.

Stock options of zero and 150,852 for the three months ended September 30, 2019 and 2018, respectively, and zero and 160,252 for the nine months ended September 30, 2019 and 2018, respectively, were excluded from the calculation of diluted earnings per share because the assumed proceeds per share of such options plus the average unearned compensation were greater than the average market price of the common stock for the periods ended and, therefore, were anti-dilutive.

Essex Portfolio, L.P.

	Three Months Ended September 30, 2019					Three Months Ended September 30, 2018
	Income		Weighted- average Common Units	Per Common Unit Amount		Income		Weighted- average Common Units	Per Common Unit Amount
Basic:
Net income available to common unitholders	$	102,799	68,148,913	$	1.51	$	83,764	68,325,091	$	1.23
Effect of Dilutive Securities:
Stock options	—		122,561			—		51,704
Diluted:
Net income available to common unitholders	$	102,799	68,271,474	$	1.51	$	83,764	68,376,795	$	1.23

	Nine Months Ended September 30, 2019					Nine Months Ended September 30, 2018
	Income		Weighted- average Common Units	Per Common Unit Amount		Income		Weighted- average Common Units	Per Common Unit Amount
Basic:
Net income available to common unitholders	$	321,331	68,058,802	$	4.72	$	281,714	68,321,153	$	4.12
Effect of Dilutive Securities:
Stock options	—		99,746			—		45,014
Diluted:
Net income available to common unitholders	$	321,331	68,158,548	$	4.71	$	281,714	68,366,167	$	4.12

Stock options of zero and 150,852 for the three months ended September 30, 2019 and 2018, respectively, and zero and 160,252 for the nine months ended September 30, 2019 and 2018, respectively, were excluded from the calculation of diluted earnings per unit because the assumed proceeds per unit of these options plus the average unearned compensation were greater than the average market price of the common unit for the periods ended and, therefore, were anti-dilutive. Additionally, the tables exclude all DownREIT limited partnership units for which the Operating Partnership has the ability and intention to redeem the units for cash and does not consider them to be common stock equivalents.

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Notes and Other Receivables

9 Months Ended

Sep. 30, 2019

Receivables [Abstract]

Notes and Other Receivables

Notes and Other Receivables

Notes and other receivables consist of the following as of September 30, 2019 and December 31, 2018 ($ in thousands):

	September 30, 2019		December 31, 2018
Notes receivable, secured, bearing interest at 10.00%, due May 2021	$	16,418	$	15,226
Notes receivable, secured, bearing interest at 10.75%, due September 2020	35,384		32,650
Notes receivable, secured, bearing interest at 9.90%, due November 2021	7,324		—
Related party note receivable, secured, bearing interest at 9.50%, due October 2019(1)	6,618		6,618
Related party note receivable, bearing variable rate interest, due December 2019(1)	89,221		—
Related party note receivable, bearing interest at 3.25%, due November 2019(1)	44,462		—
Notes and other receivables from affiliates (2)	4,311		4,457
Other receivables	12,803		12,944
Total notes and other receivables	$	216,541	$	71,895

(1) See Note 6, Related Party Transactions, for additional details.

(2) These amounts consist of short-term loans outstanding and due from various joint ventures as of September 30, 2019 and December 31, 2018, respectively. See Note 6, Related Party Transactions, for additional details.

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Organization and Basis of Presentation

9 Months Ended

Sep. 30, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Basis of Presentation

Organization and Basis of Presentation

The accompanying unaudited condensed consolidated financial statements present the accounts of Essex Property Trust, Inc. ("Essex" or the "Company"), which include the accounts of the Company and Essex Portfolio, L.P. and its subsidiaries (the "Operating Partnership," which holds the operating assets of the Company), prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and in accordance with the instructions to Form 10-Q. In the opinion of management, all adjustments necessary for a fair presentation of the financial position, results of operations, and cash flows for the periods presented have been included and are normal and recurring in nature. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Company's annual report on Form 10-K for the year ended December 31, 2018.

All significant intercompany accounts and transactions have been eliminated in the unaudited condensed consolidated financial statements. Certain reclassifications have been made to conform to the current year’s presentation.

The unaudited condensed consolidated financial statements for the three and nine months ended September 30, 2019 and 2018 include the accounts of the Company and the Operating Partnership. Essex is the sole general partner of the Operating Partnership, with a 96.6% general partnership interest as of both September 30, 2019 and December 31, 2018. Total Operating Partnership limited partnership units ("OP Units," and the holders of such OP Units, "Unitholders") outstanding were 2,298,237 and 2,305,389 as of September 30, 2019 and December 31, 2018, respectively, and the redemption value of the units, based on the closing price of the Company’s common stock totaled approximately $750.7 million and $565.3 million as of September 30, 2019 and December 31, 2018, respectively.

As of September 30, 2019, the Company owned or had ownership interests in 249 operating apartment communities, aggregating 60,620 apartment homes, excluding the Company’s ownership interest in preferred interest co-investments, loan investments, one operating commercial building, and seven active developments. The operating apartment communities are located in Southern California (primarily Los Angeles, Orange, San Diego, and Ventura counties), Northern California (the San Francisco Bay Area) and the Seattle metropolitan areas.

Accounting Pronouncements Adopted in the Current Year

In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02 (Topic 842) "Leases," which requires an entity that is a lessee to classify leases as either finance or operating and to recognize a lease liability and a right-of-use asset for all leases that have a duration of greater than 12 months. Leases of 12 months or less are to be accounted for similar to prior leasing guidance (Topic 840) for operating leases. For lessors, accounting for leases under the new standard is substantially the same as prior leasing guidance for sales-type leases, direct financing leases, and operating leases, but eliminates current real estate specific provisions and changes the treatment of initial direct costs. In July 2018, the FASB issued ASU No. 2018-11 "Leases (Topic 842): Targeted Improvements," which includes a practical expedient that allows lessors to not separate nonlease components from the associated lease component. This provides the Company with the option of not bifurcating certain common area maintenance recoveries as a non-lease component, if certain requirements are met. The Company adopted ASU No. 2016-02 and ASU No. 2018-11 as of January 1, 2019 using the modified retrospective approach and elected a package of practical expedients. There was no adjustment to the opening balance of retained earnings as a result of the adoption. See Note 11, Lease Agreements - Company as Lessor, and Note 12, Lease Agreements - Company as Lessee, for further details.

In August 2017, the FASB issued ASU No. 2017-12 "Derivatives and Hedging - Targeted Improvements to Accounting for Hedging Activities," which, among other things, requires entities to present the earnings effect of hedging instruments in the same income statement line item in which the earnings effect of the hedged item is reported. The new standard also adds new disclosure requirements. The Company adopted ASU No. 2017-12 as of January 1, 2019 using the modified retrospective method by applying a cumulative effect adjustment to accumulated other comprehensive loss, net of $0.2 million, representing accumulated net hedge ineffectiveness. Furthermore, as a result of the adoption of this standard, the Company will recognize qualifying hedge ineffectiveness through accumulated other comprehensive income as opposed to current earnings.

Recent Accounting Pronouncements

In June 2016, the FASB issued ASU No. 2016-13 "Measurement of Credit Losses on Financial Instruments," which amends the current approach to estimate credit losses on certain financial assets, including trade and other receivables, available-for-sale securities, and other financial instruments. Generally, this amendment requires entities to establish a valuation allowance for the expected lifetime losses of these certain financial assets. Subsequent changes in the valuation allowance are recorded in current earnings and reversal of previous losses are permitted. Currently, U.S. GAAP requires entities to write down credit losses only when losses are probable and loss reversals are not permitted. The FASB additionally issued various updates to clarify and amend the guidance provided in ASU 2016-13. In May 2019, the FASB issued ASU 2019-04, "Codification Improvements to Topic 326, Financial Instruments - Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments," which, with respect to credit losses, among other things, clarifies and addresses issues related to accrued interest, transfers between classifications of loans or debt securities, recoveries, and variable interest rates. Additionally, in May 2019, the FASB issued ASU 2019-05, "Financial Instruments - Credit Losses (Topic 326): Targeted Transition Relief," which allows entities to irrevocably elect the fair value option on certain financial instruments. The new standards will be effective for the Company beginning January 1, 2020 and early adoption is permitted. The Company is currently in the process of evaluating the impact of these amendments, with a focus on investments in mortgage backed securities and mezzanine loans, and does not expect the adoption to have a material impact on the Company's consolidated results of operations or financial position.

In August 2018, the FASB issued ASU No. 2018-13 "Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement," which eliminates certain disclosure requirements affecting all levels of measurements, and modifies and adds new disclosure requirements for Level 3 measurements. The new standard will be effective for the Company beginning January 1, 2020 and early adoption is permitted. The Company expects to apply the new standard on January 1, 2020 and does not expect the adoption to have a material impact on the Company's consolidated results of operations or financial position.

Marketable Securities

The Company reports its equity securities and available for sale debt securities at fair value, based on quoted market prices (Level 1 for the common stock and investment funds, Level 2 for the unsecured bonds and Level 3 for investments in mortgage backed securities, as defined by the FASB standard for fair value measurements). As of September 30, 2019 and December 31, 2018, $4.9 million and $6.7 million, respectively, of equity securities presented within common stock and stock funds in the tables below, represent investments measured at fair value, using net asset value as a practical expedient, and are not categorized in the fair value hierarchy.

Any unrealized gain or loss in debt securities classified as available for sale is recorded as other comprehensive income. Unrealized gains and losses in equity securities, realized gains and losses in debt securities, interest income, and amortization of purchase discounts are included in interest and other income on the condensed consolidated statements of income and comprehensive income.

As of September 30, 2019 and December 31, 2018, equity securities and debt securities consisted primarily of investment-grade unsecured bonds, U.S. treasury securities, common stock and stock funds, and investments in mortgage backed securities. As of September 30, 2019 and December 31, 2018, the Company classified its investments in mortgage backed securities, which mature in November 2019 and September 2020, as held to maturity, and accordingly, these securities are stated at their amortized cost. The discount on the mortgage backed securities is being amortized to interest income based on an estimated yield and the maturity date of the securities.

As of September 30, 2019 and December 31, 2018, marketable securities consist of the following ($ in thousands):

	September 30, 2019
	Amortized Cost/Cost		Gross Unrealized Gain (Loss)			Carrying Value
Equity securities:
Investment funds - debt securities	$	27,883	$	576		$	28,459
Common stock and stock funds	37,123		1,465			38,588
Debt securities:
Available for sale
U.S. treasury securities	4,915		(15		)	4,900
Investment-grade unsecured debt	1,048		10			1,058
Held to maturity
Mortgage backed securities	143,889		—			143,889
Total - Marketable securities	$	214,858	$	2,036		$	216,894

	December 31, 2018
	Amortized Cost/Cost		Gross Unrealized Gain (Loss)			Carrying Value
Equity securities:
Investment funds - debt securities	$	31,934	$	(568	)	$	31,366
Common stock and stock funds	39,731		(1,671		)	38,060
Debt securities:
Available for sale
U.S. treasury securities	8,983		(31		)	8,952
Investment-grade unsecured bonds	4,125		(145		)	3,980
Held to maturity
Mortgage backed securities	127,187		—			127,187
Total - Marketable securities	$	211,960	$	(2,415	)	$	209,545

The Company uses the specific identification method to determine the cost basis of a debt security sold and to reclassify amounts from accumulated other comprehensive income for such securities. 

For the three months ended September 30, 2019 and 2018, the proceeds from sales and maturities of marketable securities totaled $7.0 million and $3.5 million, respectively, which resulted in $0.2 million and $0.1 million in realized gains, respectively, for such periods. For the nine months ended September 30, 2019 and 2018, the proceeds from sales and maturities of marketable securities totaled $57.2 million and $22.5 million, respectively, which resulted in $0.7 million in realized gains for both periods.

For the three and nine months ended September 30, 2019, the portion of equity security unrealized losses or gains that were recognized in income totaled $0.2 million in losses and $4.3 million in gains, respectively, and were included in interest and other income on the Company's condensed consolidated statements of income and comprehensive income. For the three and nine months ended September 30, 2018, the portion of equity security unrealized gains that was recognized in income totaled

$1.2 million and $0.4 million, respectively, and was included in interest and other income on the Company's condensed consolidated statements of income and comprehensive income.

Variable Interest Entities

In accordance with accounting standards for consolidation of variable interest entities ("VIEs"), the Company consolidates the Operating Partnership, 17 DownREIT limited partnerships (comprising nine communities), and seven co-investments as of September 30, 2019. As of December 31, 2018, the Company consolidated the Operating Partnership, 16 DownREIT limited partnerships (comprising eight communities), and eight co-investments. The Company consolidates these entities because it is deemed the primary beneficiary. Essex has no assets or liabilities other than its investment in the Operating Partnership. The consolidated total assets and liabilities related to the above consolidated co-investments and DownREIT limited partnerships, net of intercompany eliminations, were approximately $1.0 billion and $372.0 million, respectively, as of September 30, 2019 and $849.8 million and $261.7 million, respectively, as of December 31, 2018. Noncontrolling interests in these entities were $129.9 million and $64.5 million as of September 30, 2019 and December 31, 2018, respectively. The Company's financial risk in each VIE is limited to its equity investment in the VIE. As of September 30, 2019 and December 31, 2018, the Company did not have any VIEs of which it was not deemed to be the primary beneficiary.

Equity-based Compensation

The cost of share- and unit-based compensation awards is measured at the grant date based on the estimated fair value of the awards. The estimated fair value of stock options and restricted stock granted by the Company are being amortized over the vesting period. The estimated grant date fair values of the long term incentive plan units (discussed in Note 13, "Equity Based Compensation Plans," in the Company’s annual report on Form 10-K for the year ended December 31, 2018) are being amortized over the expected service periods.

Fair Value of Financial Instruments

Management believes that the carrying amounts of the outstanding balances under its lines of credit, and notes and other receivables approximate fair value as of September 30, 2019 and December 31, 2018, because interest rates, yields, and other terms for these instruments are consistent with interest rates, yields, and other terms currently available for similar instruments. Management has estimated that the fair value of the Company’s fixed rate debt with a carrying value of $5.2 billion and $5.0 billion at September 30, 2019 and December 31, 2018, respectively, was approximately $5.5 billion and $5.0 billion, respectively. Management has estimated that the fair value of the Company’s $839.2 million and $619.6 million of variable rate debt at September 30, 2019 and December 31, 2018, respectively, was approximately $833.6 million and $615.2 million based on the terms of existing mortgage notes payable, unsecured debt, and variable rate demand notes compared to those available in the marketplace. Management believes that the carrying amounts of cash and cash equivalents, restricted cash, accounts payable and accrued liabilities, construction payables, other liabilities, and dividends payable approximate fair value as of September 30, 2019 and December 31, 2018 due to the short-term maturity of these instruments. Marketable securities, except mortgage backed securities, are carried at fair value as of September 30, 2019 and December 31, 2018.

At September 30, 2019, the Company’s investments in mortgage backed securities had a carrying value of $143.9 million and the Company estimated the fair value to be approximately $144.7 million. At December 31, 2018, the Company’s investments in mortgage backed securities had a carrying value of $127.2 million and the Company estimated the fair value to be approximately $129.5 million. The Company determines the fair value of the mortgage backed securities based on unobservable inputs (level 3 of the fair value hierarchy) considering the assumptions that market participants would make in valuing these securities. Assumptions such as estimated default rates and discount rates are used to determine the expected, discounted cash flows to estimate fair value.

Capitalization of Costs

The Company’s capitalized internal costs related to development and redevelopment projects were comprised primarily of employee compensation and totaled $4.3 million and $4.7 million during the three months ended September 30, 2019 and 2018, respectively, and $13.1 million and $14.2 million for the nine months ended September 30, 2019 and 2018, respectively. The Company capitalizes leasing commissions associated with the lease-up of development communities and amortizes the costs over the life of the leases. The amounts capitalized for leasing commissions are immaterial for all periods presented.

Co-investments

The Company owns investments in joint ventures in which it has significant influence, but its ownership interest does not meet the criteria for consolidation in accordance with U.S. GAAP. Therefore, the Company accounts for co-investments using the equity method of accounting. Under the equity method of accounting, the investment is carried at the cost of assets contributed, plus the Company's equity in earnings less distributions received and the Company's share of losses. The significant accounting policies of the Company’s co-investment entities are consistent with those of the Company in all material respects.

Upon the acquisition of a controlling interest of a co-investment, the co-investment entity is consolidated and a gain or loss is recognized upon the remeasurement of co-investments in the consolidated statement of income equal to the amount by which the fair value of the co-investment interest the Company previously owned exceeds its carrying value. A majority of the co-investments, excluding the preferred equity investments, compensate the Company for its asset management services and some of these investments may provide promote income if certain financial return benchmarks are achieved. Asset management fees are recognized when earned, and promote fees are recognized when the earnings events have occurred and the amount is determinable and collectible. Any promote fees are reflected in equity income from co-investments.

The Company reports investments in co-investments where accumulated distributions have exceeded the Company’s investment as distributions in excess of investments in co-investments in the accompanying condensed consolidated balance sheets. 

Changes in Accumulated Other Comprehensive Loss, Net by Component

Essex Property Trust, Inc.

($ in thousands):

	Change in fair value and amortization of swap settlements			Unrealized gains/(losses) on available for sale securities			Total
Balance at December 31, 2018	$	(13,077	)	$	(140	)	$	(13,217	)
Cumulative effect upon adoption of ASU No. 2017-12	175			—			175
Other comprehensive (loss) income before reclassification	(490		)	197			(293		)
Amounts reclassified from accumulated other comprehensive loss	(5,662		)	(31		)	(5,693		)
Other comprehensive income	(5,977		)	166			(5,811		)
Balance at September 30, 2019	$	(19,054	)	$	26		$	(19,028	)

Changes in Accumulated Other Comprehensive Loss, by Component

Essex Portfolio, L.P.

($ in thousands):

	Change in fair value and amortization of swap settlements			Unrealized gains/(losses) on available for sale securities			Total
Balance at December 31, 2018	$	(9,593	)	$	(145	)	$	(9,738	)
Cumulative effect upon adoption of ASU No. 2017-12	181			—			181
Other comprehensive income (loss) before reclassification	(506		)	203			(303		)
Amounts reclassified from accumulated other comprehensive loss	(5,860		)	(32		)	(5,892		)
Other comprehensive income	(6,185		)	171			(6,014		)
Balance at September 30, 2019	$	(15,778	)	$	26		$	(15,752	)

Amounts reclassified from accumulated other comprehensive loss in connection with derivatives are recorded in interest expense on the condensed consolidated statements of income and comprehensive income. Realized gains and losses on available for sale debt securities are included in interest and other income on the condensed consolidated statements of income and comprehensive income.

Redeemable Noncontrolling Interest

The carrying value of redeemable noncontrolling interest in the accompanying condensed consolidated balance sheets was $39.1 million and $35.5 million as of September 30, 2019 and December 31, 2018, respectively. The limited partners may redeem their noncontrolling interests for cash in certain circumstances.

The changes to the redemption value of redeemable noncontrolling interests for the nine months ended September 30, 2019 is as follows ($ in thousands):

Balance at December 31, 2018	$	35,475
Reclassification due to change in redemption value and other	3,675
Redemptions	(73		)
Balance at September 30, 2019	$	39,077

Cash, Cash Equivalents and Restricted Cash

Highly liquid investments with original maturities of three months or less when purchased are classified as cash equivalents. Restricted cash balances relate primarily to reserve requirements for capital replacement at certain communities in connection with the Company’s mortgage debt.

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the condensed consolidated statements of cash flows ($ in thousands):

	September 30, 2019		December 31, 2018		September 30, 2018		December 31, 2017
Cash and cash equivalents - unrestricted	$	74,031	$	134,465	$	157,279	$	44,620
Cash and cash equivalents - restricted	17,695		16,930		17,347		16,506
Total unrestricted and restricted cash and cash equivalents shown in the condensed consolidated statement of cash flows	$	91,726	$	151,395	$	174,626	$	61,126

Accounting Estimates

The preparation of condensed consolidated financial statements, in accordance with U.S. GAAP, requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. On an on-going basis, the Company evaluates its estimates, including those related to acquiring, developing and assessing the carrying values of its real estate portfolio, its investments in and advances to joint ventures and affiliates, its notes receivables, and its qualification as a real estate investment trust ("REIT"). The Company bases its estimates on historical experience, current market conditions, and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may vary from those estimates and those estimates could be different under different assumptions or conditions.

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Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	1 Months Ended		3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2019	Jan. 31, 2019	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Cash flows from operating activities:
Net income			$ 105,700	$ 86,110	$ 329,266	$ 289,159
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization					360,842	359,287
Amortization of discount on marketable securities					(16,673)	(12,949)
Amortization of discount (premium) and debt financing costs, net					3,454	(1,958)
Gain on sale of marketable securities					(737)	(669)
Unrealized (gain) loss on equity securities recognized through income					(4,280)	(426)
Company's share of gain on the sales of co-investments					(870)	0
Earnings from co-investments					(54,065)	(64,611)
Operating distributions from co-investments					64,628	80,232
Accrued interest from notes and other receivables					(4,523)	(4,016)
Gain on the sale of real estate and land					0	(22,244)
Equity-based compensation					6,748	7,209
Gain on early retirement of debt, net	$ (5,500)	$ (1,400)	(5,475)	0	(7,143)	0
Gain on remeasurement of co-investment			0	0	(31,535)	0
Changes in operating assets and liabilities:
Prepaid expenses, receivables, operating lease right-of-use assets, and other assets					(4,192)	(4,044)
Accounts payable, accrued liabilities, and operating lease liabilities					64,281	55,469
Other liabilities					1,726	698
Net cash provided by operating activities					706,927	681,137
Additions to real estate:
Acquisitions of real estate and acquisition related capital expenditures					(93,389)	(7,807)
Redevelopment					(55,027)	(54,656)
Development acquisitions of and additions to real estate under development					(130,593)	(131,867)
Capital expenditures on rental properties					(69,348)	(54,890)
Investments in notes receivable					(140,663)	0
Collections of notes and other receivables					2,500	29,500
Proceeds from insurance for property losses					3,599	1,237
Proceeds from dispositions of real estate					0	130,730
Contributions to co-investments					(306,233)	(100,202)
Changes in refundable deposits					325	(3,804)
Purchases of marketable securities					(42,653)	(29,130)
Sales and maturities of marketable securities					57,165	22,501
Non-operating distributions from co-investments					70,064	62,564
Net cash used in investing activities					(704,253)	(135,824)
Cash flows from financing activities:
Proceeds from unsecured debt and mortgage notes					892,762	298,773
Payments on unsecured debt and mortgage notes					(800,746)	(162,317)
Proceeds from lines of credit					1,485,034	454,170
Repayments of lines of credit					(1,265,034)	(633,170)
Retirement of common stock					(56,989)	(3,774)
Additions to deferred charges					(9,446)	(4,093)
Net proceeds from issuance of common stock					72,549	(483)
Net proceeds from stock options exercised					36,422	2,751
Payments related to tax withholding for share-based compensation					(3,515)	(23)
Distributions to noncontrolling interest					(20,269)	(22,137)
Redemption of noncontrolling interest					(14,180)	(157)
Redemption of redeemable noncontrolling interest					(73)	(43)
Common and preferred stock dividends paid					(378,858)	(361,310)
Net cash used in financing activities					(62,343)	(431,813)
Net (decrease) increase in unrestricted and restricted cash and cash equivalents					(59,669)	113,500
Unrestricted and restricted cash and cash equivalents at beginning of period		151,395			151,395	61,126	$ 61,126
Unrestricted and restricted cash and cash equivalents at end of period	91,726		91,726	174,626	91,726	174,626	151,395
Supplemental disclosure of cash flow information:
Cash paid for interest (net of $19.0 million and $13.3 million capitalized in 2019 and 2018, respectively)					145,001	146,039
Operating cash flows from operating leases					5,097	0
Supplemental disclosure of noncash investing and financing activities:
Issuance of DownREIT limited partnership units in connection with acquisition of real estate					65,472	0
Transfers between real estate under development to rental properties, net					14,501	99,547
Transfer from real estate under development to co-investments					106	640
Reclassifications to redeemable noncontrolling interest from additional paid in capital and noncontrolling interest					3,675	2,253
Redemption of redeemable noncontrolling interest via reduction of note receivable					0	4,751
Initial recognition of operating lease right-of-use assets					77,645	0
Initial recognition of operating lease liabilities					79,693	0
Debt assumed in connection with acquisition					143,006	0
Repayment of mortgage note from new financing proceeds					0	52,000
Essex Portfolio, L.P. [Member]
Cash flows from operating activities:
Net income			105,700	86,110	329,266	289,159
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization					360,842	359,287
Amortization of discount on marketable securities					(16,673)	(12,949)
Amortization of discount (premium) and debt financing costs, net					3,454	(1,958)
Gain on sale of marketable securities					(737)	(669)
Unrealized (gain) loss on equity securities recognized through income					(4,280)	(426)
Company's share of gain on the sales of co-investments					(870)	0
Earnings from co-investments					(54,065)	(64,611)
Operating distributions from co-investments					64,628	80,232
Accrued interest from notes and other receivables					(4,523)	(4,016)
Gain on the sale of real estate and land					0	(22,244)
Equity-based compensation					6,748	7,209
Gain on early retirement of debt, net			(5,475)	0	(7,143)	0
Gain on remeasurement of co-investment			0	0	(31,535)	0
Changes in operating assets and liabilities:
Prepaid expenses, receivables, operating lease right-of-use assets, and other assets					(4,192)	(4,044)
Accounts payable, accrued liabilities, and operating lease liabilities					64,281	55,469
Other liabilities					1,726	698
Net cash provided by operating activities					706,927	681,137
Additions to real estate:
Acquisitions of real estate and acquisition related capital expenditures					(93,389)	(7,807)
Redevelopment					(55,027)	(54,656)
Development acquisitions of and additions to real estate under development					(130,593)	(131,867)
Capital expenditures on rental properties					(69,348)	(54,890)
Investments in notes receivable					(140,663)	0
Collections of notes and other receivables					2,500	29,500
Proceeds from insurance for property losses					3,599	1,237
Proceeds from dispositions of real estate					0	130,730
Contributions to co-investments					(306,233)	(100,202)
Changes in refundable deposits					325	(3,804)
Purchases of marketable securities					(42,653)	(29,130)
Sales and maturities of marketable securities					57,165	22,501
Non-operating distributions from co-investments					70,064	62,564
Net cash used in investing activities					(704,253)	(135,824)
Cash flows from financing activities:
Proceeds from unsecured debt and mortgage notes					892,762	298,773
Payments on unsecured debt and mortgage notes					(800,746)	(162,317)
Proceeds from lines of credit					1,485,034	454,170
Repayments of lines of credit					(1,265,034)	(633,170)
Retirement of common stock					(56,989)	(3,774)
Additions to deferred charges					(9,446)	(4,093)
Net proceeds from issuance of common stock					72,549	(483)
Net proceeds from stock options exercised					36,422	2,751
Payments related to tax withholding for share-based compensation					(3,515)	(23)
Distributions to noncontrolling interest					(5,978)	(6,615)
Redemption of noncontrolling interest					(14,180)	(157)
Redemption of redeemable noncontrolling interest					(73)	(43)
Common and preferred stock dividends paid					(393,149)	(376,832)
Net cash used in financing activities					(62,343)	(431,813)
Net (decrease) increase in unrestricted and restricted cash and cash equivalents					(59,669)	113,500
Unrestricted and restricted cash and cash equivalents at beginning of period		$ 151,395			151,395	61,126	61,126
Unrestricted and restricted cash and cash equivalents at end of period	$ 91,726		$ 91,726	$ 174,626	91,726	174,626	$ 151,395
Supplemental disclosure of cash flow information:
Cash paid for interest (net of $19.0 million and $13.3 million capitalized in 2019 and 2018, respectively)					145,001	146,039
Operating cash flows from operating leases					5,097	0
Supplemental disclosure of noncash investing and financing activities:
Issuance of DownREIT limited partnership units in connection with acquisition of real estate					65,472	0
Transfers between real estate under development to rental properties, net					14,501	99,547
Transfer from real estate under development to co-investments					106	640
Reclassifications to redeemable noncontrolling interest from additional paid in capital and noncontrolling interest					3,675	2,253
Redemption of redeemable noncontrolling interest via reduction of note receivable					0	4,571
Initial recognition of operating lease right-of-use assets					77,645	0
Initial recognition of operating lease liabilities					79,693	0
Debt assumed in connection with acquisition					143,006	0
Repayment of mortgage note from new financing proceeds					$ 0	$ 52,000

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Lease Agreements - Company as Lessee - Maturity under 840 (Details) $ in Thousands	Dec. 31, 2018 USD ($)
Leases [Abstract]
2019	$ 6,811
2020	6,855
2021	6,877
2022	6,888
2023	6,860
Thereafter	153,258
Total lease future minimum rent	$ 187,549

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Lease Agreements - Company as Lessor (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2019 USD ($) building	Dec. 31, 2018 USD ($) building
Lessor, Lease, Description [Line Items]
Number of commercial buildings under lease agreements | building	1	1
Lessor, Operating Lease, Payments, Fiscal Year Maturity [Abstract]
Remaining in 2019	$ 310,385
2020	489,601
2021	15,105
2022	14,080
2023	12,853
Thereafter	37,940
Operating leases	$ 879,964
Operating Leases, Future Minimum Payments Receivable [Abstract]
2019		$ 16,386
2020		15,842
2021		14,412
2022		13,324
2023		12,181
Thereafter		33,034
Future minimum receivables		$ 105,179
Minimum
Lessor, Lease, Description [Line Items]
Short-term lease terms	9 months
Commercial lease terms	5 years
Maximum
Lessor, Lease, Description [Line Items]
Short-term lease terms	12 months
Commercial lease terms	20 years

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Condensed Consolidated Statement of Equity - USD ($) $ in Thousands	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Distributions in Excess of Accumulated Earnings [Member]	Accumulated Other Comprehensive Loss, Net [Member]	Noncontrolling Interest [Member]
Balance at period beginning at Dec. 31, 2017	$ 6,396,825	$ 7	$ 7,129,571	$ (833,726)	$ (18,446)	$ 119,419
Balances (in shares) at Dec. 31, 2017		66,054,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	289,159			272,333		16,826
Reversal of unrealized gains upon the sale of marketable debt securities	6				6
Change in fair value of derivatives and amortization of swap settlements	12,630				12,210	420
Change in fair value of marketable debt securities, net	(87)				(84)	(3)
Issuance of common stock under:
Stock option and restricted stock plans, net	2,751		2,751
Stock option and restricted stock plans, net (in shares)		17,000
Sale of common stock, net	(483)		(483)
Equity based compensation costs	8,561		7,697			864
Retirement of common stock, net	(3,774)		(3,774)
Retirement of common stock, net (in shares)		(17,000)
Changes in the redemption value of redeemable noncontrolling interest	(2,253)		(2,032)			(221)
Distributions to noncontrolling interest	(22,281)					(22,281)
Redemptions of noncontrolling interest	(157)		(143)			(14)
Redemptions of noncontrolling interest (in shares)		1,000
Common stock dividends	(368,577)			(368,577)
Balance at period end at Sep. 30, 2018	6,436,028	$ 7	7,133,587	(808,085)	(8,548)	119,067
Balances (in shares) at Sep. 30, 2018		66,055,000
Balance at period beginning at Jun. 30, 2018	6,474,683	$ 7	7,131,809	(766,193)	(11,438)	120,498
Balances (in shares) at Jun. 30, 2018		66,050,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	86,110			80,975		5,135
Reversal of unrealized gains upon the sale of marketable debt securities	4				4
Change in fair value of derivatives and amortization of swap settlements	2,974				2,875	99
Change in fair value of marketable debt securities, net	12				11	1
Issuance of common stock under:
Stock option and restricted stock plans, net	887		887
Stock option and restricted stock plans, net (in shares)		5,000
Sale of common stock, net	(130)		(130)
Equity based compensation costs	1,747		1,496			251
Changes in the redemption value of redeemable noncontrolling interest	(408)		(386)			(22)
Distributions to noncontrolling interest	(6,884)					(6,884)
Redemptions of noncontrolling interest	(100)		(89)			(11)
Common stock dividends	(122,867)			(122,867)
Balance at period end at Sep. 30, 2018	6,436,028	$ 7	7,133,587	(808,085)	(8,548)	119,067
Balances (in shares) at Sep. 30, 2018		66,055,000
Issuance of common stock under:
Cumulative effect upon adoption of ASU No. 2017-12					175
Balance at period beginning at Dec. 31, 2018	6,393,844	$ 7	7,093,079	(812,796)	(13,217)	126,771
Balances (in shares) at Dec. 31, 2018		65,890,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	329,266			310,468		18,798
Reversal of unrealized gains upon the sale of marketable debt securities	(32)				(31)	(1)
Change in fair value of derivatives and amortization of swap settlements	(6,366)				(6,152)	(214)
Change in fair value of marketable debt securities, net	203				197	6
Issuance of common stock under:
Stock option and restricted stock plans, net	32,907		32,907
Stock option and restricted stock plans, net (in shares)		188,000
Sale of common stock, net	72,549	$ 73,400	72,549
Sale of common stock, net (in shares)		228,271
Equity based compensation costs	7,914		7,016			898
Retirement of common stock, net	(56,989)		(56,989)
Retirement of common stock, net (in shares)		(234,000)
Changes in the redemption value of redeemable noncontrolling interest	(3,675)		(5,048)			1,373
Changes in noncontrolling interest from acquisition	65,472					65,472
Distributions to noncontrolling interest	(20,897)					(20,897)
Redemptions of noncontrolling interest	(14,180)		(11,872)			(2,308)
Redemptions of noncontrolling interest (in shares)		10,000
Common stock dividends	(385,193)			(385,193)
Balance at period end at Sep. 30, 2019	6,415,004	$ 7	7,131,642	(887,521)	(19,028)	189,904
Balances (in shares) at Sep. 30, 2019		66,082,000
Balance at period beginning at Jun. 30, 2019	6,345,116	$ 7	7,031,886	(857,994)	(18,992)	190,209
Balances (in shares) at Jun. 30, 2019		65,727,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	105,700			99,335		6,365
Change in fair value of derivatives and amortization of swap settlements	(12)				(12)	0
Change in fair value of marketable debt securities, net	(25)				(24)	(1)
Issuance of common stock under:
Stock option and restricted stock plans, net	27,679		27,679
Stock option and restricted stock plans, net (in shares)		126,000
Sale of common stock, net	72,631		72,631
Sale of common stock, net (in shares)		228,000
Equity based compensation costs	1,814		1,544			270
Changes in the redemption value of redeemable noncontrolling interest	(2,247)		(2,309)			62
Distributions to noncontrolling interest	(6,789)					(6,789)
Redemptions of noncontrolling interest	(1)		211			(212)
Redemptions of noncontrolling interest (in shares)		1,000
Common stock dividends	(128,862)			(128,862)
Balance at period end at Sep. 30, 2019	$ 6,415,004	$ 7	$ 7,131,642	$ (887,521)	$ (19,028)	$ 189,904
Balances (in shares) at Sep. 30, 2019		66,082,000

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Cover Page - shares	9 Months Ended
	Sep. 30, 2019	Oct. 22, 2019
Entity Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2019
Document Transition Report	false
Entity File Number	001-13106
Entity Registrant Name	ESSEX PROPERTY TRUST, INC.
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	77-0369576
Entity Address, Address Line One	1100 Park Place, Suite 200
Entity Address, City or Town	San Mateo
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94403
City Area Code	650
Local Phone Number	655-7800
Title of each class	Common Stock, $0.0001 par value (Essex Property Trust, Inc.)
Trading Symbol	ESS
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		66,081,652
Entity Central Index Key	0000920522
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3
Amendment Flag	false
Essex Portfolio, L.P. [Member]
Entity Information [Line Items]
Entity File Number	333-44467-01
Entity Registrant Name	ESSEX PORTFOLIO LP
Entity Incorporation, State or Country Code	CA
Entity Tax Identification Number	77-0369575
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Current Fiscal Year End Date	--12-31

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Revenues - Deferred Revenues and Remaining Performance Obligations (Details)	Sep. 30, 2019
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-10-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Percentage of remaining performance obligations due per period	5.00%
Expected timing of performance obligation satisfaction, period	3 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Percentage of remaining performance obligations due per period	36.00%
Expected timing of performance obligation satisfaction, period	2 years

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Related Party Transactions (Details) $ in Thousands	1 Months Ended							3 Months Ended		9 Months Ended		12 Months Ended			17 Months Ended
	Aug. 31, 2019 USD ($)	Jun. 30, 2019 USD ($) apartment	Feb. 28, 2019 USD ($)	Oct. 31, 2018 USD ($) apartment	May 31, 2018 USD ($) apartment	Nov. 30, 2017 USD ($)	Mar. 31, 2017 USD ($) unit	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2015 USD ($) investment	Sep. 30, 2019 USD ($)	Nov. 30, 2016 USD ($)
Related Party Transaction [Line Items]
Management and other fees from affiliates								$ 3,700	$ 3,600	$ 10,600	$ 10,000
Development and redevelopment fees								1,200	$ 1,300	3,600	3,200
Debt assumed in connection with acquisition										143,006	0
Payments to acquire preferred equity investments										306,233	$ 100,202
Co-investments								1,413,861		1,413,861		$ 1,300,140			$ 1,413,861
Short-term loans outstanding and due from various joint ventures								4,300		$ 4,300		4,500			4,300
Brio, Walnut Creek, California [Member]
Related Party Transaction [Line Items]
Number of units acquired | apartment		300
Payments to acquire real estate		$ 164,900
Debt assumed in connection with acquisition		$ 98,700
Multifamily Development in Mountain View, California [Member]
Related Party Transaction [Line Items]
Preferred returns rate			11.00%
Commitment to fund preferred equity investment			$ 24,500
Apartment Home Community In Ventura, California [Member]
Related Party Transaction [Line Items]
Number of units acquired | apartment					400
Preferred returns rate					10.25%
Commitment to fund preferred equity investment					$ 26,500
Commitment funded amount															21,900
Membership Interest In Sage At Cupertino [Member]
Related Party Transaction [Line Items]
Number of units acquired | unit							230
Co-investments							$ 15,300
Equity method investment, ownership percentage acquired							40.50%
Contract price							$ 90,000
Mortgage encumbrance							$ 52,000
Related Party Bridge Loan on Property Acquired By BEX IV [Member]
Related Party Transaction [Line Items]
Interest rate										3.25%
Affiliated Entity [Member] | Multifamily Development in Mountain View, California [Member]
Related Party Transaction [Line Items]
Payments to acquire preferred equity investments			$ 24,500
Preferred returns rate			11.00%
Affiliated Entity [Member] | Home Community Development in Burlingame, California [Member]
Related Party Transaction [Line Items]
Number of units acquired | apartment				268
Payments to acquire preferred equity investments				$ 18,600
Preferred returns rate				12.00%
Affiliated Entity [Member] | Related Party Bridge Loans on Property Acquired by Bex III [Member]
Related Party Transaction [Line Items]
Notes receivable						$ 29,500
Interest rate						3.50%
Affiliated Entity [Member] | Related Party Bridge Loans on Property Acquired By Wesco V [Member]
Related Party Transaction [Line Items]
Notes receivable	$ 89,000							89,200		$ 89,200					89,200
Interest rate	1.30%
Affiliated Entity [Member] | Related Party Bridge Loan on Property Acquired By BEX IV [Member]
Related Party Transaction [Line Items]
Notes receivable	$ 44,400							44,500		44,500					44,500
Interest rate	3.25%
Limited Liability Company [Member]
Related Party Transaction [Line Items]
Payments to acquire preferred equity investments														$ 20,000
Number of preferred equity method investments acquired during period (in investments) | investment														3
Preferred stock, stated interest percentage														9.50%
Redeemed amount												5,000	$ 5,000
Limited Liability Company [Member] | Secured Note Receivable, 9.90% Interest Rate, Due October 2019 [Member] | Marcus and Millichamp Company TMMC Affiliate [Member]
Related Party Transaction [Line Items]
Notes receivable								$ 6,600		$ 6,600		$ 6,600			$ 6,600	$ 6,600

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Co-investments (Tables)

9 Months Ended

Sep. 30, 2019

Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures [Abstract]

Summary of co-investments

The carrying values of the Company's co-investments as of September 30, 2019 and December 31, 2018 are as follows ($ in thousands, except parenthetical amounts):

	Weighted Average Company Ownership Percentage (1)		September 30, 2019		December 31, 2018
Ownership interest in:
CPPIB	54	%	$	469,288	$	482,507
Wesco I, Wesco III, Wesco IV, and Wesco V	52	%	212,808		194,890
BEXAEW, BEX II, BEX III, and BEX IV	50	%	161,467		121,780
Other	48	%	20,281		34,093
Total operating and other co-investments, net			863,844		833,270
Total pre-development and development co-investments	50	%	137,626		94,060
Total preferred interest co-investments (includes related party investments of $70.9 million and $51.8 million as of September 30, 2019 and December 31, 2018, respectively)			412,391		372,810
Total co-investments, net			$	1,413,861	$	1,300,140

(1) Weighted average Company ownership percentages are as of September 30, 2019.

Summarized financial information for co-investments accounted for under the equity method

The combined summarized entity financial information of co-investments is as follows ($ in thousands):

	September 30, 2019		December 31, 2018
Combined balance sheets: (1)
Rental properties and real estate under development	$	4,779,685	$	4,367,987
Other assets	110,364		104,119
Total assets	$	4,890,049	$	4,472,106
Debt	$	2,316,618	$	2,190,764
Other liabilities	146,643		106,316
Equity	2,426,788		2,175,026
Total liabilities and equity	$	4,890,049	$	4,472,106
Company's share of equity	$	1,413,861	$	1,300,140

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Combined statements of income: (1)
Property revenues	$	84,071		$	84,820		$	249,628		$	247,010
Property operating expenses	(29,214		)	(27,779		)	(85,768		)	(81,415		)
Net operating income	54,857			57,041			163,860			165,595
Interest expense	(16,089		)	(15,805		)	(47,284		)	(46,179		)
General and administrative	(2,603		)	(1,254		)	(6,774		)	(5,134		)
Depreciation and amortization	(30,411		)	(32,833		)	(89,283		)	(95,312		)
Net income	$	5,754		$	7,149		$	20,519		$	18,970
Company's share of net income (2)	$	21,700		$	16,788		$	54,935		$	64,611

(1) Includes preferred equity investments held by the Company.

(2) Includes the Company's share of equity income from joint ventures and preferred equity investments, gain on sales of co-investments, co-investment promote income and income from early redemption of preferred equity investments. Includes related party income of $2.0 million and $0.7 million for the three months ended September 30, 2019 and 2018, respectively, and $5.5 million and $1.4 million for the nine months ended September 30, 2019 and 2018, respectively.

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Commitments and Contingencies

9 Months Ended

Sep. 30, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

The Company is subject to various lawsuits in the normal course of its business operations. Such lawsuits have not had a material adverse effect on the Company's financial condition, results of operations or cash flows. While no assurances can be given, the Company does not believe there is any pending or threatened litigation against the Company that, individually or in the aggregate, would reasonably be expected to have a material adverse effect on the Company.

The Company is subject to various federal, state, and local environmental laws. Compliance by the Company with existing laws has not had a material adverse effect on the Company. However, the Company cannot predict the impact of new or changed laws or regulations on its current portfolio or on other assets that the Company may acquire in the future. To the extent that an environmental matter arises or is identified in the future that has other than a remote risk of having a material impact on the condensed consolidated financial statements, the Company will disclose the estimated range of possible outcomes associated with it, and, if an outcome is probable, accrue an appropriate liability for that matter. The Company will consider whether any such matter results in an impairment of value on the affected property and, if so, impairment will be recognized.

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Debt

9 Months Ended

Sep. 30, 2019

Debt Disclosure [Abstract]

Debt

Debt

The Company does not have indebtedness as debt is incurred by the Operating Partnership. The Company guarantees the Operating Partnership’s unsecured debt including the revolving credit facilities for the full term of the facilities.

Debt consists of the following ($ in thousands):

	September 30, 2019			December 31, 2018			Weighted Average Maturity In Years as of September 30, 2019
Unsecured bonds private placement - fixed rate	$	274,772		$	274,624		1.3
Term loan - variable rate	349,088			348,813			2.4
Bonds public offering - fixed rate	4,062,311			3,175,879			7.6
Unsecured debt, net (1)	4,686,171			3,799,316
Lines of credit (2)	220,000			—
Mortgage notes payable, net (3)	1,141,970			1,806,626			6.8
Total debt, net	$	6,048,141		$	5,605,942
Weighted average interest rate on fixed rate unsecured bonds private placement and bonds public offering	3.8		%	3.9		%
Weighted average interest rate on variable rate term loan	2.9		%	3.0		%
Weighted average interest rate on lines of credit	2.8		%	3.2		%
Weighted average interest rate on mortgage notes payable	4.3		%	4.3		%

(1) Includes unamortized discount of $14.7 million and $7.1 million and unamortized debt issuance costs of $24.1 million and $18.5 million, as of September 30, 2019 and December 31, 2018, respectively.

(2) Lines of credit, related to the Company's two lines of unsecured credit aggregating $1.24 billion as of September 30, 2019, excludes unamortized debt issuance costs of $4.1 million and $3.9 million as of September 30, 2019 and December 31, 2018, respectively. These debt issuance costs are included in prepaid expenses and other assets on the condensed consolidated balance sheets. As of September 30, 2019, the Company’s $1.2 billion credit facility had an interest rate of LIBOR plus 0.825%, which is based on a tiered rate structure tied to the Company’s credit ratings and a scheduled maturity date of December 2022 with one 18-month extension, exercisable at the Company’s option. As of September 30, 2019, the Company’s $35.0 million working capital unsecured line of credit had an interest rate of LIBOR plus 0.825%, which is based on a tiered rate structure tied to the Company’s credit ratings and a scheduled maturity date of February 2021.

(3) Includes total unamortized premium of $6.7 million and $14.9 million, reduced by unamortized debt issuance costs of $2.9 million and $4.2 million, as of September 30, 2019 and December 31, 2018, respectively.

The aggregate scheduled principal payments of the Company’s outstanding debt as of September 30, 2019 are as follows (excluding lines of credit) ($ in thousands):

Remaining in 2019	$	78,379
2020	408,064
2021	545,537
2022	693,188
2023	602,945
Thereafter	3,535,092
Total	$	5,863,205

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Revenues

9 Months Ended

Sep. 30, 2019

Revenue from Contract with Customer [Abstract]

Revenues

Revenues

Disaggregated Revenue

The following table presents the Company’s revenues disaggregated by revenue source ($ in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Rental income (1)	$	358,001	$	342,246	$	1,058,973	$	1,021,742
Other property (1)	6,503		6,364		18,794		18,341
Management and other fees from affiliates	2,428		2,307		7,023		6,812
Total revenues	$	366,932	$	350,917	$	1,084,790	$	1,046,895

(1) On January 1, 2019, the Company adopted ASU No. 2016-02 “Leases.” As a result of this adoption certain amounts previously classified as other property revenue have been reclassified to rental income. Prior period amounts have been adjusted to conform to the current period’s presentation.

The following table presents the Company’s rental and other property-related revenues disaggregated by geographic operating segment ($ in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Southern California	$	152,312	$	148,575	455,302		442,382
Northern California	144,124		131,538		420,544		389,750
Seattle Metro	61,657		59,231		182,738		176,740
Other real estate assets (1)	6,411		9,266		19,183		31,211
Total rental and other property revenues	$	364,504	$	348,610	$	1,077,767	$	1,040,083

(1) Other real estate assets consists of revenues generated from retail space, commercial properties, held for sale properties, and disposition properties.

The following table presents the Company’s rental and other property-related revenues disaggregated by current property category status ($ in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Same-property (1)	$	342,115	$	331,695	$	1,019,509	$	987,564
Acquisitions (2)	7,309		—		14,416		—
Development (3)	1,859		1,091		4,184		1,560
Redevelopment	5,255		5,125		15,690		15,185
Non-residential/other, net (4)	7,966		10,699		23,968		35,774
Total rental and other property revenues	$	364,504	$	348,610	$	1,077,767	$	1,040,083

(1) Properties that have stabilized operations as of January 1, 2018 and are consolidated by the Company for the three and nine months ended September 30, 2019 and 2018. A community is generally considered to have reached stabilized operations once it achieves an initial occupancy of 95%.

(2) Acquisitions includes properties acquired which did not have comparable stabilized results as of January 1, 2018.

(3) Development includes properties developed which did not have stabilized results as of January 1, 2018.

(4) Non-residential/other, net consists of revenues generated from retail space, commercial properties, held for sale properties, disposition properties and student housing.

Deferred Revenues and Remaining Performance Obligations

When cash payments are received or due in advance of the Company’s performance of contracts with customers, deferred revenue is recorded. The total deferred revenue balance related to such contracts was $4.1 million and $6.2 million as of September 30, 2019 and December 31, 2018, respectively, and was included in accounts payable and accrued liabilities within the accompanying condensed consolidated balance sheets. The amount of revenue recognized for the nine months ended September 30, 2019 that was included in the December 31, 2018 deferred revenue balance was $2.1 million, which was included in interest and other income within the condensed consolidated statements of income and comprehensive income.

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in the revenue recognition accounting standard. As of September 30, 2019, the Company had $4.1 million of remaining

performance obligations. The Company expects to recognize approximately 5% of these remaining performance obligations in 2019, an additional 36% through 2021, and the remaining balance thereafter.

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Organization and Basis of Presentation - Redeemable Noncontrolling Interest (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2019 USD ($)
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward]
December 31, 2018	$ 35,475
Reclassification due to change in redemption value and other	3,675
Redemptions	(73)
September 30, 2019	$ 39,077

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Segment Information (Tables)

9 Months Ended

Sep. 30, 2019

Segment Reporting [Abstract]

Reconciliation of revenues and operating profit (loss) from segments to consolidated

The revenues and NOI for each of the reportable operating segments are summarized as follows for the three and nine months ended September 30, 2019 and 2018 ($ in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Revenues:
Southern California	$	152,312		$	148,575		$	455,302		$	442,382
Northern California	144,124			131,538			420,544			389,750
Seattle Metro	61,657			59,231			182,738			176,740
Other real estate assets	6,411			9,266			19,183			31,211
Total property revenues	$	364,504		$	348,610		$	1,077,767		$	1,040,083
Net operating income:
Southern California	$	106,951		$	104,732		$	323,073		$	314,977
Northern California	105,381			97,244			310,407			288,222
Seattle Metro	43,701			40,999			129,013			123,432
Other real estate assets	6,000			7,860			19,040			26,568
Total net operating income	262,033			250,835			781,533			753,199
Management and other fees from affiliates	2,428			2,307			7,023			6,812
Corporate-level property management expenses	(8,255		)	(7,761		)	(24,620		)	(23,313		)
Depreciation and amortization	(120,809		)	(120,852		)	(360,842		)	(359,287		)
General and administrative	(11,345		)	(10,601		)	(38,731		)	(36,539		)
Expensed acquisition and investment related costs	(13		)	(31		)	(69		)	(156		)
Gain on sale of real estate and land	—			—			—			22,244
Interest expense	(54,896		)	(55,196		)	(162,651		)	(166,335		)
Total return swap income	2,154			2,184			6,174			6,682
Interest and other income	8,685			8,437			29,293			21,241
Equity income from co-investments	21,700			16,788			54,935			64,611
Deferred tax expense on unrealized gain on unconsolidated co-investment	(1,457		)	—			(1,457		)	—
Gain on early retirement of debt, net	5,475			—			7,143			—
Gain on remeasurement of co-investment	—			—			31,535			—
Net income	$	105,700		$	86,110		$	329,266		$	289,159

Reconciliation of assets from segment to consolidated

Total assets for each of the reportable operating segments are summarized as follows as of September 30, 2019 and December 31, 2018 ($ in thousands):

	September 30, 2019		December 31, 2018
Assets:
Southern California	$	4,245,335	$	4,350,377
Northern California	4,623,559		4,270,238
Seattle Metro	1,444,045		1,472,916
Other real estate assets	66,579		63,022
Net reportable operating segment - real estate assets	10,379,518		10,156,553
Real estate under development	562,338		454,629
Co-investments	1,413,861		1,300,140
Cash and cash equivalents, including restricted cash	91,726		151,395
Marketable securities	216,894		209,545
Notes and other receivables	216,541		71,895
Operating lease right-of-use assets	75,478		—
Prepaid expenses and other assets	41,536		39,439
Total assets	$	12,997,892	$	12,383,596

XML

Label	Element	Value
Accounting Standards Update 2017-05 [Member] | Accumulated Distributions in Excess of Net Income [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ 119,651,000
Accounting Standards Update 2017-05 [Member] | Noncontrolling Interest [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	4,057,000
Accounting Standards Update 2017-12 [Member] | AOCI Attributable to Parent [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	175,000
Accounting Standards Update 2017-12 [Member] | Noncontrolling Interest [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	6,000
Accounting Standards Update 2016-01 [Member] | AOCI Attributable to Parent [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	(2,234,000)
Accounting Standards Update 2016-01 [Member] | Accumulated Distributions in Excess of Net Income [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ 2,234,000

XML

Organization and Basis of Presentation - Narrative (Details) $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2019 USD ($) community building investment partnership apartment project shares	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($) community building investment partnership apartment project shares	Sep. 30, 2018 USD ($)	Dec. 31, 2018 USD ($) community investment partnership shares	Jan. 01, 2019 USD ($)
Real Estate Properties [Line Items]
Ownership interest in partnership			96.60%		96.60%
Apartment communities owned (in communities) | community	249		249
Apartment units owned (in Shares) | apartment	60,620		60,620
Ownership interest, number of commercial buildings (in commercial buildings) | building	1		1
Ownership interest, number of active development projects (in projects) | project	7		7
Equity securities	$ 4,900		$ 4,900		$ 6,700
Sales and maturities of marketable securities	7,000	$ 3,500	57,200	$ 22,500
Marketable securities, realized gain (loss)	$ 200	100	700	700
Gain (loss) on sale of equity securities			$ 4,280	426
Downreit limited partnerships consolidated by company (in partnerships) | partnership	17		17		16
Communities within Downreit partnerships (in communities) | community	9		9		8
Number of previously consolidated co-investments considered VIE (in investments) | investment	7		7		8
Assets related to variable interest entities net of intercompany eliminations	$ 1,000,000		$ 1,000,000		$ 849,800
Liabilities related to variable interest entities net of intercompany eliminations	372,000		372,000		261,700
Noncontrolling interest in variable interest entity	129,900		129,900		64,500
Fixed rate debt carrying amount	5,200,000		5,200,000		5,000,000
Fixed rate debt fair value	5,500,000		5,500,000		5,000,000
Variable rate debt, carrying amount	839,200		839,200		619,600
Variable rate debt fair value	833,600		833,600		615,200
Investments in mortgage back securities, fair value	144,700		144,700		129,500
Capitalized internal costs related to development and redevelopment projects	4,300	4,700	13,100	14,200
Redeemable noncontrolling interest	39,077		39,077		35,475
Mortgage backed securities [Member]
Real Estate Properties [Line Items]
Investments in mortgage backed securities, carrying value	143,889		143,889		$ 127,187
Interest And Other Income [Member]
Real Estate Properties [Line Items]
Gain (loss) on sale of equity securities	$ (200)	$ 1,200	$ 4,300	400
ASU 2017-12 [Member]
Real Estate Properties [Line Items]
Accumulated other comprehensive loss, cumulative effect adjustment, accumulated net hedge ineffectiveness						$ 200
Essex Portfolio, L.P. [Member]
Real Estate Properties [Line Items]
Operating Partnership units outstanding (in Shares) | shares	2,298,237		2,298,237		2,305,389
Redemption value of operating partnership units outstanding	$ 750,700		$ 750,700		$ 565,300
Gain (loss) on sale of equity securities			4,280	$ 426
Redeemable noncontrolling interest	$ 39,077		$ 39,077		$ 35,475

XML

Lease Agreements - Company as Lessee - Maturity (Details) $ in Thousands	Sep. 30, 2019 USD ($)
Lessee, Operating Lease, Liability, Payment, Due [Abstract]
Remaining in 2019	$ 1,717
2020	6,855
2021	6,877
2022	6,888
2023	6,860
Thereafter	153,258
Total lease payments	182,455
Less: Imputed interest	(104,960)
Operating lease liabilities	$ 77,495

XML

Net Income Per Common Share and Net Income Per Common Unit (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Basic:
Net income available to common stockholders/unitholders	$ 99,335	$ 80,975	$ 310,468	$ 272,333
Weighted average number of shares/common units outstanding during the period (in shares)	65,850,524	66,052,108	65,757,914	66,047,990
Net income available to common stockholders/unitholders (in dollars per share)	$ 1.51	$ 1.23	$ 4.72	$ 4.12
Effect of Dilutive Securities: Stock options (in shares)	122,561	51,704	99,746	45,014
Diluted:
Net income available to common stockholders/unitholders	$ 99,335	$ 80,975	$ 310,468	$ 272,333
Net income available to common stockholders/unitholders, weighted average common shares (in shares)	65,973,085	66,103,812	65,857,660	66,093,004
Net income available to common stockholders/unitholders (in dollars per share)	$ 1.51	$ 1.22	$ 4.71	$ 4.12
Essex Portfolio, L.P. [Member]
Basic:
Net income available to common stockholders/unitholders	$ 102,799	$ 83,764	$ 321,331	$ 281,714
Weighted average number of shares/common units outstanding during the period (in shares)	68,148,913	68,325,091	68,058,802	68,321,153
Net income available to common stockholders/unitholders (in dollars per share)	$ 1.51	$ 1.23	$ 4.72	$ 4.12
Effect of Dilutive Securities: Stock options (in shares)	122,561	51,704	99,746	45,014
Diluted:
Net income available to common stockholders/unitholders	$ 102,799	$ 83,764	$ 321,331	$ 281,714
Net income available to common stockholders/unitholders, weighted average common shares (in shares)	68,271,474	68,376,795	68,158,548	68,366,167
Net income available to common stockholders/unitholders (in dollars per share)	$ 1.51	$ 1.23	$ 4.71	$ 4.12
Convertible Limited Partnership Units [Member]
Diluted:
Antidilutive securities excluded from computation of earnings per share, amount (in shares)	2,298,389	2,272,983	2,300,888	2,273,163
Income allocated to convertible OP Units	$ 3,500	$ 2,800	$ 10,900	$ 9,400
Share-based Payment Arrangement, Option [Member]
Diluted:
Antidilutive securities excluded from computation of earnings per share, amount (in shares)	0	150,852	0	160,252
Share-based Payment Arrangement, Option [Member] | Essex Portfolio, L.P. [Member]
Diluted:
Antidilutive securities excluded from computation of earnings per share, amount (in shares)	0	150,852	0	160,252

XML

Condensed Consolidated Statement of Capital - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Jan. 01, 2019	Jan. 01, 2018
Increase (Decrease) in Partners' Capital [Roll Forward]
Net income	$ 105,700	$ 86,110	$ 329,266	$ 289,159
Reversal of unrealized gains upon the sale of marketable debt securities		4	(32)	6
Change in fair value of marketable debt securities, net	(25)	12	203	(87)
Issuance of common stock under:
Sale of common stock by general partner, net	72,631	(130)	72,549	(483)
Retirement of common units, net			(56,989)	(3,774)
Changes in the redemption value of redeemable noncontrolling interest	(2,247)	(408)	(3,675)	(2,253)
Changes in noncontrolling interest from acquisition			65,472
Distributions to noncontrolling interest	(6,789)	(6,884)	(20,897)	(22,281)
Redemptions	(1)	(100)	(14,180)	(157)
ASU 2017-12 [Member]
Issuance of common stock under:
Cumulative effect upon adoption of ASU No. 2017-12					$ 181
ASU 2016-01 [Member]
Issuance of common stock under:
Cumulative effect upon adoption of ASU No. 2017-12						$ 0
ASU 2017-05 [Member]
Issuance of common stock under:
Cumulative effect upon adoption of ASU No. 2017-12						123,708
Essex Portfolio, L.P. [Member]
Increase (Decrease) in Partners' Capital [Roll Forward]
Balance at period beginning	6,345,116	6,474,683	6,393,844	6,396,825
Net income	105,700	86,110	329,266	289,159
Reversal of unrealized gains upon the sale of marketable debt securities		4	(32)	6
Change in fair value of derivatives and amortization of swap settlements	(12)	2,974	(6,366)	12,630
Change in fair value of marketable debt securities, net	(25)	12	203	(87)
Issuance of common stock under:
General partner's stock based compensation, net	27,679	887	32,907	2,751
Sale of common stock by general partner, net	72,631	(130)	72,549	(483)
Equity based compensation costs	1,814	1,747	7,914	8,561
Retirement of common units, net			(56,989)	(3,774)
Changes in the redemption value of redeemable noncontrolling interest	(2,247)	(408)	(3,675)	(2,253)
Changes in noncontrolling interest from acquisition			65,472
Distributions to noncontrolling interest	(2,302)	(2,632)	(7,412)	(9,522)
Redemptions	(1)	(100)	(14,180)	(157)
Distributions declared	(133,349)	(127,119)	(398,678)	(381,336)
Balance at period end	6,415,004	6,436,028	6,415,004	6,436,028
Essex Portfolio, L.P. [Member] | ASU 2017-12 [Member]
Issuance of common stock under:
Cumulative effect upon adoption of ASU No. 2017-12					181
Essex Portfolio, L.P. [Member] | ASU 2016-01 [Member]
Issuance of common stock under:
Cumulative effect upon adoption of ASU No. 2017-12						0
Essex Portfolio, L.P. [Member] | ASU 2017-05 [Member]
Issuance of common stock under:
Cumulative effect upon adoption of ASU No. 2017-12						123,708
Essex Portfolio, L.P. [Member] | Common Equity [Member] | General Partner [Member]
Increase (Decrease) in Partners' Capital [Roll Forward]
Balance at period beginning	$ 6,173,899	$ 6,365,623	$ 6,280,290	$ 6,295,852
Balance at period beginning (in shares)	65,727	66,050	65,890	66,054
Net income	$ 99,335	$ 80,975	$ 310,468	$ 272,333
Issuance of common stock under:
General partner's stock based compensation, net	$ 27,679	$ 887	$ 32,907	$ 2,751
General partner's stock based compensation, net (in shares)	126	5	188	17
Sale of common stock by general partner, net	$ 72,631	$ (130)	$ 72,549	$ (483)
Sale of common stock by general partner, net (in shares)	228		228
Equity based compensation costs	$ 1,544	1,496	$ 7,016	7,697
Retirement of common units, net			$ (56,989)	$ (3,774)
Retirement of common units, net (in shares)			(234)	(17)
Changes in the redemption value of redeemable noncontrolling interest	(2,309)	(386)	$ (5,048)	$ (2,032)
Redemptions	$ 211	(89)	$ (11,872)	$ (143)
Redemptions (in shares)	(1)		(10)	(1)
Distributions declared	$ (128,862)	(122,867)	$ (385,193)	$ (368,577)
Balance at period end	$ 6,244,128	$ 6,325,509	$ 6,244,128	$ 6,325,509
Balance at period end (in shares)	66,082	66,055	66,082	66,055
Essex Portfolio, L.P. [Member] | Common Equity [Member] | General Partner [Member] | ASU 2016-01 [Member]
Issuance of common stock under:
Cumulative effect upon adoption of ASU No. 2017-12						2,234
Essex Portfolio, L.P. [Member] | Common Equity [Member] | General Partner [Member] | ASU 2017-05 [Member]
Issuance of common stock under:
Cumulative effect upon adoption of ASU No. 2017-12						119,651
Essex Portfolio, L.P. [Member] | Common Equity [Member] | Limited Partner [Member]
Increase (Decrease) in Partners' Capital [Roll Forward]
Balance at period beginning	$ 57,726	$ 52,339	$ 59,061	$ 49,792
Balance at period beginning (in shares)	2,299	2,273	2,305	2,268
Net income	$ 3,464	$ 2,789	$ 10,863	$ 9,381
Issuance of common stock under:
Equity based compensation costs	270	251	$ 898	$ 864
Equity based compensation costs (in shares)			3	5
Changes in the redemption value of redeemable noncontrolling interest	61	(34)	$ 63	$ (233)
Redemptions	$ (32)		$ (398)	$ (3)
Redemptions (in shares)	(1)		(10)	0
Distributions declared	$ (4,487)	(4,252)	$ (13,485)	$ (12,759)
Balance at period end	$ 57,002	$ 51,093	$ 57,002	$ 51,093
Balance at period end (in shares)	2,298	2,273	2,298	2,273
Essex Portfolio, L.P. [Member] | Common Equity [Member] | Limited Partner [Member] | ASU 2016-01 [Member]
Issuance of common stock under:
Cumulative effect upon adoption of ASU No. 2017-12						(6)
Essex Portfolio, L.P. [Member] | Common Equity [Member] | Limited Partner [Member] | ASU 2017-05 [Member]
Issuance of common stock under:
Cumulative effect upon adoption of ASU No. 2017-12						4,057
Essex Portfolio, L.P. [Member] | Accumulated Other Comprehensive Loss [Member]
Increase (Decrease) in Partners' Capital [Roll Forward]
Balance at period beginning	$ (15,715)	$ (7,898)	$ (9,738)	$ (15,229)
Reversal of unrealized gains upon the sale of marketable debt securities		4	(32)	6
Change in fair value of derivatives and amortization of swap settlements	(12)	2,974	(6,366)	12,630
Change in fair value of marketable debt securities, net	(25)	12	203	(87)
Issuance of common stock under:
Balance at period end	(15,752)	(4,908)	(15,752)	(4,908)
Essex Portfolio, L.P. [Member] | Accumulated Other Comprehensive Loss [Member] | ASU 2017-12 [Member]
Issuance of common stock under:
Cumulative effect upon adoption of ASU No. 2017-12					$ 181
Essex Portfolio, L.P. [Member] | Accumulated Other Comprehensive Loss [Member] | ASU 2016-01 [Member]
Issuance of common stock under:
Cumulative effect upon adoption of ASU No. 2017-12						$ (2,228)
Essex Portfolio, L.P. [Member] | Noncontrolling Interest [Member]
Increase (Decrease) in Partners' Capital [Roll Forward]
Balance at period beginning	129,206	64,619	64,231	66,410
Net income	2,901	2,346	7,935	7,445
Issuance of common stock under:
Changes in the redemption value of redeemable noncontrolling interest	1	12	1,310	12
Changes in noncontrolling interest from acquisition			65,472
Distributions to noncontrolling interest	(2,302)	(2,632)	(7,412)	(9,522)
Redemptions	(180)	(11)	(1,910)	(11)
Balance at period end	$ 129,626	$ 64,334	$ 129,626	$ 64,334

XML

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions	Sep. 30, 2019	Dec. 31, 2018
Related party receivables	$ 144.6	$ 11.1
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	670,000,000	670,000,000
Common stock, shares issued (in shares)	66,081,635	65,890,322
Common stock, shares outstanding (in shares)	66,081,635	65,890,322
Essex Portfolio, L.P. [Member]
Related party receivables	$ 144.6	$ 11.1
Essex Portfolio, L.P. [Member] | General Partner [Member]
Common stock, shares issued (in shares)	66,081,635	65,890,322
Common stock, shares outstanding (in shares)	66,081,635	65,890,322
Essex Portfolio, L.P. [Member] | Limited Partners [Member]
Common stock, shares issued (in shares)	2,298,237	2,305,389
Common stock, shares outstanding (in shares)	2,298,237	2,305,389

XML

Debt - Narrative (Details)	9 Months Ended
	Sep. 30, 2019 USD ($) instrument extension	Dec. 31, 2018 USD ($)
Debt Instrument [Line Items]
Number of lines of unsecured credit (in instruments) | instrument	2
Unsecured Debt [Member]
Debt Instrument [Line Items]
Unamortized discount (premium), net	$ 14,700,000	$ 7,100,000
Unamortized debt issuance expense	24,100,000	18,500,000
Line of Credit [Member]
Debt Instrument [Line Items]
Aggregate borrowing capacity	1,240,000,000
Line of Credit [Member] | Unsecured Line of Credit [Member]
Debt Instrument [Line Items]
Unamortized debt issuance expense	4,100,000	3,900,000
Unsecured Line of Credit [Member] | Line of Credit [Member]
Debt Instrument [Line Items]
Aggregate borrowing capacity	$ 1,200,000,000
Number of extension options (in extensions) | extension	1
Extension period (in months)	18 months
Unsecured Line of Credit [Member] | Line of Credit [Member] | London Interbank Offered Rate (LIBOR) [Member]
Debt Instrument [Line Items]
Basis spread on variable rate	0.825%
Unsecured Line of Credit [Member] | Line of Credit Working Capital [Member]
Debt Instrument [Line Items]
Aggregate borrowing capacity	$ 35,000,000.0
Unsecured Line of Credit [Member] | Line of Credit Working Capital [Member] | London Interbank Offered Rate (LIBOR) [Member]
Debt Instrument [Line Items]
Basis spread on variable rate	0.825%
Mortgage notes payable, net [Member]
Debt Instrument [Line Items]
Unamortized discount (premium), net	$ (6,700,000)	(14,900,000)
Unamortized debt issuance expense	$ 2,900,000	$ 4,200,000

XML

Significant Transactions During the Nine Months Ended September 30, 2019 and Subsequent Events (Details)	1 Months Ended									3 Months Ended		9 Months Ended
	Oct. 25, 2019 USD ($)	Sep. 30, 2019 USD ($) apartment $ / shares	Aug. 31, 2019 USD ($) apartment	Jun. 30, 2019 USD ($) apartment	May 31, 2019 USD ($)	Apr. 30, 2019 USD ($)	Mar. 31, 2019 USD ($)	Feb. 28, 2019 USD ($)	Jan. 31, 2019 USD ($) shares	Sep. 30, 2019 USD ($) $ / shares shares	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($) $ / shares shares	Sep. 30, 2018 USD ($)	Aug. 01, 2019 USD ($)	Dec. 31, 2018 USD ($)
Other Commitments [Line Items]
Repayments of secured debt		$ 289,100,000							$ 290,000,000.0
Gain on remeasurement of co-investment										$ 0	$ 0	$ 31,535,000	$ 0
Debt assumed in connection with acquisition												143,006,000	0
Gain on sale of real estate and land										0	0	0	22,244,000
Ownership interest of initial equity commitment		1,413,861,000								1,413,861,000		1,413,861,000			$ 1,300,140,000
Shares repurchased during period (in shares) | shares									234,061
Shares repurchased during period, value									$ 57,000,000.0
Purchase authority remaining under stock repurchase plan		$ 250,000,000.0						$ 250,000,000.0		250,000,000.0		250,000,000.0
Sale of common stock, net										$ 72,631,000	(130,000)	$ 72,549,000	(483,000)
Senior unsecured debt of coupon rate		5.69%							5.57%	5.69%		5.69%
Proceeds from issuance of debt												$ 892,762,000	298,773,000
Gain on early retirement of debt, net		$ 5,500,000							$ 1,400,000	$ 5,475,000	$ 0	$ 7,143,000	$ 0
Subsequent Event [Member]
Other Commitments [Line Items]
Proceeds from full redemption of a preferred equity investment in a joint venture	$ 15,800,000
Early redemption fee	200,000
Senior Notes [Member] | Unsecured Notes, 4.0% Interest Rate, Due March 2029 [Member]
Other Commitments [Line Items]
Operating partner issued senior unsecured debt notes							$ 150,000,000.0	$ 350,000,000.0
Senior unsecured debt of coupon rate								4.00%
Debt offering price, percentage of par value							100.717%	99.188%
Senior Notes [Member] | Unsecured Notes, 3.0% Interest Rate, Due January 2030 [Member]
Other Commitments [Line Items]
Operating partner issued senior unsecured debt notes			$ 400,000,000.0
Senior unsecured debt of coupon rate			3.00%
Debt offering price, percentage of par value			98.632%
Senior Notes [Member] | Unsecured Notes, 3.000% Interest Rate, Due January 2020 [Member] | Subsequent Event [Member]
Other Commitments [Line Items]
Proceeds from issuance of debt	$ 150,000,000.0
Debt offering price, percentage of par value	101.685%
Common Stock [Member]
Other Commitments [Line Items]
Sale of common stock, net (in shares) | shares										228,000		228,271
Common stock dividends (in dollars per share) | $ / shares		$ 321.56								$ 321.56		$ 321.56
Sale of common stock, net												$ 73,400,000
Brio, Walnut Creek, California [Member]
Other Commitments [Line Items]
Number of units acquired | apartment				300
Payments to acquire real estate				$ 164,900,000
Debt assumed in connection with acquisition				$ 98,700,000
Wesco V, LLC (Wesco V), Emeryville [Member]
Other Commitments [Line Items]
Number of units acquired | apartment			331
Payments to acquire real estate			$ 178,000,000.0
Debt assumed in connection with acquisition			$ 89,000,000.0
Wesco V, LLC (Wesco V), Emeryville [Member] | Loan of (LIBOR) [Member]
Other Commitments [Line Items]
Loan of the Company with an interest rate of LIBOR														1.30%
BEX IV, LLC (BEX IV), Menlo Park [Member]
Other Commitments [Line Items]
Number of units acquired | apartment			195
Payments to acquire real estate			$ 148,000,000.0
Debt assumed in connection with acquisition			$ 44,400,000
BEX IV, LLC (BEX IV), Menlo Park [Member] | Loan of (LIBOR) [Member]
Other Commitments [Line Items]
Loan of the Company with an interest rate of LIBOR														3.25%
Redwood City [Member]
Other Commitments [Line Items]
Number of units acquired | apartment		132
Payments to acquire real estate		$ 88,700,000
Acquisition of company assumed mortgage debt		44,300,000								$ 44,300,000		44,300,000
BEX IV,Ownership Interest In The Joint Venture [Member]
Other Commitments [Line Items]
Limited partnership interest in partnership investments			50.10%
Ownership interest of initial equity commitment														$ 52,200,000
Multifamily Development in Mountain View, California [Member]
Other Commitments [Line Items]
Commitment to fund preferred equity investment								$ 24,500,000
Preferred returns rate								11.00%
San Jose, CA [Member]
Other Commitments [Line Items]
Proceeds from full redemption of a preferred equity investment in a joint venture								$ 10,900,000
Early redemption fee								$ 100,000
Multifamily Development Community in Irvine, California [Member]
Other Commitments [Line Items]
Commitment to fund preferred equity investment							$ 36,000,000.0
Preferred returns rate							10.15%
Funded commitment amount		21,600,000								21,600,000		21,600,000
Joint Venture that Holds Property in Santa Ana, California [Member]
Other Commitments [Line Items]
Proceeds from full redemption of a preferred equity investment in a joint venture						$ 16,300,000
Early redemption fee						700,000
Multifamily Development In Oakland, California, 10.25% Rate [Member]
Other Commitments [Line Items]
Commitment to fund preferred equity investment						$ 36,800,000
Preferred returns rate						10.25%
Funded commitment amount		15,000,000.0								15,000,000.0		15,000,000.0
Multifamily Development In Oakland, California, 11.0% Rate [Member]
Other Commitments [Line Items]
Commitment to fund preferred equity investment						$ 11,800,000
Preferred returns rate						11.00%
Funded commitment amount		5,500,000								5,500,000		5,500,000
Redmond, WA [Member]
Other Commitments [Line Items]
Proceeds from full redemption of a preferred equity investment in a joint venture		14,800,000
Early redemption fee		300,000								300,000		300,000
Seattle, WA [Member]
Other Commitments [Line Items]
Proceeds from full redemption of a preferred equity investment in a joint venture		16,300,000
Early redemption fee		$ 1,400,000								$ 1,400,000		$ 1,400,000
One South Market, San Jose, CA [Member]
Other Commitments [Line Items]
Limited partnership interest in partnership investments							45.00%
Payments to joint venture interest							$ 80,600,000
Repayments of secured debt							86,000,000.0
Gain on remeasurement of co-investment							31,500,000
Promote income							$ 800,000
Land Located in Oakland, California [Member]
Other Commitments [Line Items]
Limited partnership interest in partnership investments					50.00%
Proceeds from sale of real estate					$ 6,100,000
Gain on sale of real estate and land					$ 900,000

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Co-investments - Combined Financial Information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Equity Method Investment, Summarized Financial Information, Assets [Abstract]
Rental properties and real estate under development	$ 562,338		$ 562,338		$ 454,629
Other liabilities	36,128		36,128		33,375
Equity Method Investment, Summarized Financial Information, Income Statement [Abstract]
Interest expense	(54,896)	$ (55,196)	(162,651)	$ (166,335)
General and administrative	(11,345)	(10,601)	(38,731)	(36,539)
Total co investment [Member]
Equity Method Investment, Summarized Financial Information, Assets [Abstract]
Rental properties and real estate under development	4,779,685		4,779,685		4,367,987
Other assets	110,364		110,364		104,119
Total assets	4,890,049		4,890,049		4,472,106
Debt	2,316,618		2,316,618		2,190,764
Other liabilities	146,643		146,643		106,316
Equity	2,426,788		2,426,788		2,175,026
Total liabilities and equity	4,890,049		4,890,049		4,472,106
Company's share of equity	1,413,861		1,413,861		$ 1,300,140
Equity Method Investment, Summarized Financial Information, Income Statement [Abstract]
Property revenues	84,071	84,820	249,628	247,010
Property operating expenses	(29,214)	(27,779)	(85,768)	(81,415)
Net operating income	54,857	57,041	163,860	165,595
Interest expense	(16,089)	(15,805)	(47,284)	(46,179)
General and administrative	(2,603)	(1,254)	(6,774)	(5,134)
Depreciation and amortization	(30,411)	(32,833)	(89,283)	(95,312)
Net income	5,754	7,149	20,519	18,970
Company's share of net income	21,700	16,788	54,935	64,611
Total co investment [Member] | Affiliated Entity [Member]
Equity Method Investment, Summarized Financial Information, Income Statement [Abstract]
Company's share of net income	$ 2,000	$ 700	$ 5,500	$ 1,400

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Organization and Basis of Presentation (Tables)

9 Months Ended

Sep. 30, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Components of marketable securities

As of September 30, 2019 and December 31, 2018, marketable securities consist of the following ($ in thousands):

	September 30, 2019
	Amortized Cost/Cost		Gross Unrealized Gain (Loss)			Carrying Value
Equity securities:
Investment funds - debt securities	$	27,883	$	576		$	28,459
Common stock and stock funds	37,123		1,465			38,588
Debt securities:
Available for sale
U.S. treasury securities	4,915		(15		)	4,900
Investment-grade unsecured debt	1,048		10			1,058
Held to maturity
Mortgage backed securities	143,889		—			143,889
Total - Marketable securities	$	214,858	$	2,036		$	216,894

	December 31, 2018
	Amortized Cost/Cost		Gross Unrealized Gain (Loss)			Carrying Value
Equity securities:
Investment funds - debt securities	$	31,934	$	(568	)	$	31,366
Common stock and stock funds	39,731		(1,671		)	38,060
Debt securities:
Available for sale
U.S. treasury securities	8,983		(31		)	8,952
Investment-grade unsecured bonds	4,125		(145		)	3,980
Held to maturity
Mortgage backed securities	127,187		—			127,187
Total - Marketable securities	$	211,960	$	(2,415	)	$	209,545

Changes in accumulated other comprehensive income (loss)

Changes in Accumulated Other Comprehensive Loss, Net by Component

Essex Property Trust, Inc.

($ in thousands):

	Change in fair value and amortization of swap settlements			Unrealized gains/(losses) on available for sale securities			Total
Balance at December 31, 2018	$	(13,077	)	$	(140	)	$	(13,217	)
Cumulative effect upon adoption of ASU No. 2017-12	175			—			175
Other comprehensive (loss) income before reclassification	(490		)	197			(293		)
Amounts reclassified from accumulated other comprehensive loss	(5,662		)	(31		)	(5,693		)
Other comprehensive income	(5,977		)	166			(5,811		)
Balance at September 30, 2019	$	(19,054	)	$	26		$	(19,028	)

Changes in Accumulated Other Comprehensive Loss, by Component

Essex Portfolio, L.P.

($ in thousands):

	Change in fair value and amortization of swap settlements			Unrealized gains/(losses) on available for sale securities			Total
Balance at December 31, 2018	$	(9,593	)	$	(145	)	$	(9,738	)
Cumulative effect upon adoption of ASU No. 2017-12	181			—			181
Other comprehensive income (loss) before reclassification	(506		)	203			(303		)
Amounts reclassified from accumulated other comprehensive loss	(5,860		)	(32		)	(5,892		)
Other comprehensive income	(6,185		)	171			(6,014		)
Balance at September 30, 2019	$	(15,778	)	$	26		$	(15,752	)

Schedule of changes to the redemption value of noncontrolling interests

The changes to the redemption value of redeemable noncontrolling interests for the nine months ended September 30, 2019 is as follows ($ in thousands):

Balance at December 31, 2018	$	35,475
Reclassification due to change in redemption value and other	3,675
Redemptions	(73		)
Balance at September 30, 2019	$	39,077

Schedule of cash and cash equivalents

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the condensed consolidated statements of cash flows ($ in thousands):

	September 30, 2019		December 31, 2018		September 30, 2018		December 31, 2017
Cash and cash equivalents - unrestricted	$	74,031	$	134,465	$	157,279	$	44,620
Cash and cash equivalents - restricted	17,695		16,930		17,347		16,506
Total unrestricted and restricted cash and cash equivalents shown in the condensed consolidated statement of cash flows	$	91,726	$	151,395	$	174,626	$	61,126

Schedule of restricted cash and cash equivalents

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the condensed consolidated statements of cash flows ($ in thousands):

	September 30, 2019		December 31, 2018		September 30, 2018		December 31, 2017
Cash and cash equivalents - unrestricted	$	74,031	$	134,465	$	157,279	$	44,620
Cash and cash equivalents - restricted	17,695		16,930		17,347		16,506
Total unrestricted and restricted cash and cash equivalents shown in the condensed consolidated statement of cash flows	$	91,726	$	151,395	$	174,626	$	61,126

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Lease Agreements - Company as Lessor

9 Months Ended

Sep. 30, 2019

Leases [Abstract]

Lease Agreements - Company as Lessor

Lease Agreements - Company as Lessor

As of September 30, 2019, the Company is a lessor of apartment homes at all of its consolidated operating and lease-up communities, one commercial building, and commercial portions of mixed use communities. The apartment homes are rented under short-term leases (generally, lease terms of nine to 12 months) while commercial lease terms typically range from five to 20 years. All such leases are classified as operating leases.

Although the majority of the Company’s apartment home and commercial leasing income is derived from fixed lease payments, some lease agreements also allow for variable payments. The primary driver of variable leasing income comes from utility reimbursements from apartment home leases and common area maintenance reimbursements from commercial leases. A small number of commercial leases contain provisions for lease payments based on a percentage of gross retail sales over set hurdles.

At the end of the term of apartment home leases, unless the lessee decides to renew the lease with the Company at the market rate or gives notice not to renew, the lease will be automatically renewed on a month-to-month term. Apartment home leases include an option to terminate the lease, however the lessee must pay the Company for expected or actual downtime to find a new tenant to lease the space or a lease-break fee specified in the lease agreement. Most commercial leases include options to renew, with the renewal periods extending the term of the lease for no greater than the same period of time as the original lease term. The initial option to renew for commercial leases will typically be based on a fixed price while any subsequent renewal options will generally be based on the current market rate at the time of the renewal. Certain commercial leases contain lease termination options that would require the lessee to pay termination fees based on the expected amount of time it would take the Company to re-lease the space.

The Company’s apartment home and commercial lease agreements do not contain residual value guarantees. As the Company is the lessor of real estate assets which tend to either hold their value or appreciate, residual value risk is not deemed to be substantial. Furthermore, the Company carries comprehensive liability, fire, extended coverage, and rental loss insurance for each of its communities as well as limited insurance coverage for certain types of extraordinary losses, such as, for example, losses from terrorism or earthquakes.

A maturity analysis of undiscounted future minimum non-cancelable base rent to be received under the above operating leases as of September 30, 2019 is summarized as follows ($ in thousands):

	Future Minimum Rent
Remaining in 2019	$	310,385
2020	489,601
2021	15,105
2022	14,080
2023	12,853
Thereafter	37,940
	$	879,964

As of December 31, 2018, in accordance with previously applicable lease accounting guidance, Accounting Standards Codification ("ASC") 840, "Leases", the future minimum non-cancelable base rent to be received under one commercial building and commercial portions of mixed use communities, for which the Company was the lessor, was as follows ($ in thousands):

	Future Minimum Rent
2019	$	16,386
2020	15,842
2021	14,412
2022	13,324
2023	12,181
Thereafter	33,034
	$	105,179

Practical Expedients

The Company has elected to account for operating lease (e.g., fixed payments including rent) and non-lease components (e.g., utility reimbursements and common-area maintenance costs) as a single combined lease component under ASC 842 as the lease components are the predominant elements of the combined components.

As part of the transition to ASC 842, the Company has elected to use the modified retrospective transition method with the new standard being applied as of the January 1, 2019 adoption date. Additionally, the Company has elected, as of the adoption date, not to reassess whether expired or existing contracts contain leases under the new definition of a lease, not to reassess the lease classification for expired or existing leases, not to reassess whether previously capitalized initial direct costs would qualify for capitalization under ASC 842, and not to reassess whether existing or expired land easements meet the definition of a lease.

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Debt (Tables)

9 Months Ended

Sep. 30, 2019

Debt Disclosure [Abstract]

Schedule of debt and lines of credit

Debt consists of the following ($ in thousands):

	September 30, 2019			December 31, 2018			Weighted Average Maturity In Years as of September 30, 2019
Unsecured bonds private placement - fixed rate	$	274,772		$	274,624		1.3
Term loan - variable rate	349,088			348,813			2.4
Bonds public offering - fixed rate	4,062,311			3,175,879			7.6
Unsecured debt, net (1)	4,686,171			3,799,316
Lines of credit (2)	220,000			—
Mortgage notes payable, net (3)	1,141,970			1,806,626			6.8
Total debt, net	$	6,048,141		$	5,605,942
Weighted average interest rate on fixed rate unsecured bonds private placement and bonds public offering	3.8		%	3.9		%
Weighted average interest rate on variable rate term loan	2.9		%	3.0		%
Weighted average interest rate on lines of credit	2.8		%	3.2		%
Weighted average interest rate on mortgage notes payable	4.3		%	4.3		%

(1) Includes unamortized discount of $14.7 million and $7.1 million and unamortized debt issuance costs of $24.1 million and $18.5 million, as of September 30, 2019 and December 31, 2018, respectively.

(2) Lines of credit, related to the Company's two lines of unsecured credit aggregating $1.24 billion as of September 30, 2019, excludes unamortized debt issuance costs of $4.1 million and $3.9 million as of September 30, 2019 and December 31, 2018, respectively. These debt issuance costs are included in prepaid expenses and other assets on the condensed consolidated balance sheets. As of September 30, 2019, the Company’s $1.2 billion credit facility had an interest rate of LIBOR plus 0.825%, which is based on a tiered rate structure tied to the Company’s credit ratings and a scheduled maturity date of December 2022 with one 18-month extension, exercisable at the Company’s option. As of September 30, 2019, the Company’s $35.0 million working capital unsecured line of credit had an interest rate of LIBOR plus 0.825%, which is based on a tiered rate structure tied to the Company’s credit ratings and a scheduled maturity date of February 2021.

(3) Includes total unamortized premium of $6.7 million and $14.9 million, reduced by unamortized debt issuance costs of $2.9 million and $4.2 million, as of September 30, 2019 and December 31, 2018, respectively.

Summary of aggregate scheduled principal payments

The aggregate scheduled principal payments of the Company’s outstanding debt as of September 30, 2019 are as follows (excluding lines of credit) ($ in thousands):

Remaining in 2019	$	78,379
2020	408,064
2021	545,537
2022	693,188
2023	602,945
Thereafter	3,535,092
Total	$	5,863,205

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Revenues - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Disaggregation of Revenue [Line Items]
Total revenues	$ 366,932	$ 350,917	$ 1,084,790	$ 1,046,895
Occupancy threshold for classification as stabilized	95.00%		95.00%
Deferred revenue	$ 4,100		$ 4,100		$ 6,200
Deferred revenue, revenue recognized			2,100
Deferred revenue balance from contracts with remaining performance obligations	4,100		4,100
Rental [Member]
Disaggregation of Revenue [Line Items]
Total revenues	358,001	342,246	1,058,973	1,021,742
Other Property [Member]
Disaggregation of Revenue [Line Items]
Total revenues	6,503	6,364	18,794	18,341
Management and Other Fees From Affiliates Income [Member]
Disaggregation of Revenue [Line Items]
Total revenues	2,428	2,307	7,023	6,812
Rental and Other Property Revenues [Member]
Disaggregation of Revenue [Line Items]
Total revenues	364,504	348,610	1,077,767	1,040,083
Rental and Other Property Revenues [Member] | Same Property [Member]
Disaggregation of Revenue [Line Items]
Total revenues	342,115	331,695	1,019,509	987,564
Rental and Other Property Revenues [Member] | Acquisitions [Member]
Disaggregation of Revenue [Line Items]
Total revenues	7,309	0	14,416	0
Rental and Other Property Revenues [Member] | Development [Member]
Disaggregation of Revenue [Line Items]
Total revenues	1,859	1,091	4,184	1,560
Rental and Other Property Revenues [Member] | Redevelopment [Member]
Disaggregation of Revenue [Line Items]
Total revenues	5,255	5,125	15,690	15,185
Rental and Other Property Revenues [Member] | Non-Residential/Other, Net [Member]
Disaggregation of Revenue [Line Items]
Total revenues	7,966	10,699	23,968	35,774
Rental and Other Property Revenues [Member] | Operating Segments [Member] | Southern California [Member]
Disaggregation of Revenue [Line Items]
Total revenues	152,312	148,575	455,302	442,382
Rental and Other Property Revenues [Member] | Operating Segments [Member] | Northern California [Member]
Disaggregation of Revenue [Line Items]
Total revenues	144,124	131,538	420,544	389,750
Rental and Other Property Revenues [Member] | Operating Segments [Member] | Seattle Metro [Member]
Disaggregation of Revenue [Line Items]
Total revenues	61,657	59,231	182,738	176,740
Rental and Other Property Revenues [Member] | Other real estate assets [Member]
Disaggregation of Revenue [Line Items]
Total revenues	$ 6,411	$ 9,266	$ 19,183	$ 31,211

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Notes and Other Receivables (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2019	Dec. 31, 2018
Accounts, Notes, Loans and Financing Receivable [Line Items]
Notes receivable	$ 216,541	$ 71,895
Secured Note Receivable, 10.00% Interest Rate, Due May 2021 [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Notes receivable	$ 16,418	15,226
Stated interest rate	10.00%
Secured Note Receivable, 10.75% Interest Rate, Due September 2020 [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Notes receivable	$ 35,384	32,650
Stated interest rate	10.75%
Secured Note Receivable, 9.90% Interest Rate, Due October 2019 [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Notes receivable	$ 7,324	0
Stated interest rate	9.90%
Related Party Bridge Loans, Secured, Due October 2019 [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Notes receivable	$ 6,618	6,618
Interest rate	9.50%
Related Party Bridge Loans on Property Acquired By Wesco V [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Notes receivable	$ 89,221	0
Related Party Bridge Loan on Property Acquired By BEX IV [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Notes receivable	$ 44,462	0
Interest rate	3.25%
Notes and Other Receivables from Affiliates [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Notes receivable	$ 4,311	4,457
Other Receivables [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Notes receivable	$ 12,803	$ 12,944

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Debt - Future Principal Payments (Details) $ in Thousands	Sep. 30, 2019 USD ($)
Debt Disclosure [Abstract]
Remaining in 2019	$ 78,379
2020	408,064
2021	545,537
2022	693,188
2023	602,945
Thereafter	3,535,092
Long-term debt	$ 5,863,205

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Notes and Other Receivables (Tables)

9 Months Ended

Sep. 30, 2019

Receivables [Abstract]

Notes and other receivables

Notes and other receivables consist of the following as of September 30, 2019 and December 31, 2018 ($ in thousands):

	September 30, 2019		December 31, 2018
Notes receivable, secured, bearing interest at 10.00%, due May 2021	$	16,418	$	15,226
Notes receivable, secured, bearing interest at 10.75%, due September 2020	35,384		32,650
Notes receivable, secured, bearing interest at 9.90%, due November 2021	7,324		—
Related party note receivable, secured, bearing interest at 9.50%, due October 2019(1)	6,618		6,618
Related party note receivable, bearing variable rate interest, due December 2019(1)	89,221		—
Related party note receivable, bearing interest at 3.25%, due November 2019(1)	44,462		—
Notes and other receivables from affiliates (2)	4,311		4,457
Other receivables	12,803		12,944
Total notes and other receivables	$	216,541	$	71,895

(1) See Note 6, Related Party Transactions, for additional details.

(2) These amounts consist of short-term loans outstanding and due from various joint ventures as of September 30, 2019 and December 31, 2018, respectively. See Note 6, Related Party Transactions, for additional details.

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Organization and Basis of Presentation (Policies)

9 Months Ended

Sep. 30, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Consolidation Policy

The accompanying unaudited condensed consolidated financial statements present the accounts of Essex Property Trust, Inc. ("Essex" or the "Company"), which include the accounts of the Company and Essex Portfolio, L.P. and its subsidiaries (the "Operating Partnership," which holds the operating assets of the Company), prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and in accordance with the instructions to Form 10-Q. In the opinion of management, all adjustments necessary for a fair presentation of the financial position, results of operations, and cash flows for the periods presented have been included and are normal and recurring in nature. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Company's annual report on Form 10-K for the year ended December 31, 2018.

All significant intercompany accounts and transactions have been eliminated in the unaudited condensed consolidated financial statements. Certain reclassifications have been made to conform to the current year’s presentation.

New Accounting Pronouncements

Accounting Pronouncements Adopted in the Current Year

In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02 (Topic 842) "Leases," which requires an entity that is a lessee to classify leases as either finance or operating and to recognize a lease liability and a right-of-use asset for all leases that have a duration of greater than 12 months. Leases of 12 months or less are to be accounted for similar to prior leasing guidance (Topic 840) for operating leases. For lessors, accounting for leases under the new standard is substantially the same as prior leasing guidance for sales-type leases, direct financing leases, and operating leases, but eliminates current real estate specific provisions and changes the treatment of initial direct costs. In July 2018, the FASB issued ASU No. 2018-11 "Leases (Topic 842): Targeted Improvements," which includes a practical expedient that allows lessors to not separate nonlease components from the associated lease component. This provides the Company with the option of not bifurcating certain common area maintenance recoveries as a non-lease component, if certain requirements are met. The Company adopted ASU No. 2016-02 and ASU No. 2018-11 as of January 1, 2019 using the modified retrospective approach and elected a package of practical expedients. There was no adjustment to the opening balance of retained earnings as a result of the adoption. See Note 11, Lease Agreements - Company as Lessor, and Note 12, Lease Agreements - Company as Lessee, for further details.

In August 2017, the FASB issued ASU No. 2017-12 "Derivatives and Hedging - Targeted Improvements to Accounting for Hedging Activities," which, among other things, requires entities to present the earnings effect of hedging instruments in the same income statement line item in which the earnings effect of the hedged item is reported. The new standard also adds new disclosure requirements. The Company adopted ASU No. 2017-12 as of January 1, 2019 using the modified retrospective method by applying a cumulative effect adjustment to accumulated other comprehensive loss, net of $0.2 million, representing accumulated net hedge ineffectiveness. Furthermore, as a result of the adoption of this standard, the Company will recognize qualifying hedge ineffectiveness through accumulated other comprehensive income as opposed to current earnings.

Recent Accounting Pronouncements

In June 2016, the FASB issued ASU No. 2016-13 "Measurement of Credit Losses on Financial Instruments," which amends the current approach to estimate credit losses on certain financial assets, including trade and other receivables, available-for-sale securities, and other financial instruments. Generally, this amendment requires entities to establish a valuation allowance for the expected lifetime losses of these certain financial assets. Subsequent changes in the valuation allowance are recorded in current earnings and reversal of previous losses are permitted. Currently, U.S. GAAP requires entities to write down credit losses only when losses are probable and loss reversals are not permitted. The FASB additionally issued various updates to clarify and amend the guidance provided in ASU 2016-13. In May 2019, the FASB issued ASU 2019-04, "Codification Improvements to Topic 326, Financial Instruments - Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments," which, with respect to credit losses, among other things, clarifies and addresses issues related to accrued interest, transfers between classifications of loans or debt securities, recoveries, and variable interest rates. Additionally, in May 2019, the FASB issued ASU 2019-05, "Financial Instruments - Credit Losses (Topic 326): Targeted Transition Relief," which allows entities to irrevocably elect the fair value option on certain financial instruments. The new standards will be effective for the Company beginning January 1, 2020 and early adoption is permitted. The Company is currently in the process of evaluating the impact of these amendments, with a focus on investments in mortgage backed securities and mezzanine loans, and does not expect the adoption to have a material impact on the Company's consolidated results of operations or financial position.

In August 2018, the FASB issued ASU No. 2018-13 "Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement," which eliminates certain disclosure requirements affecting all levels of measurements, and modifies and adds new disclosure requirements for Level 3 measurements. The new standard will be effective for the Company beginning January 1, 2020 and early adoption is permitted. The Company expects to apply the new standard on January 1, 2020 and does not expect the adoption to have a material impact on the Company's consolidated results of operations or financial position.

Marketable Securities

Marketable Securities

The Company reports its equity securities and available for sale debt securities at fair value, based on quoted market prices (Level 1 for the common stock and investment funds, Level 2 for the unsecured bonds and Level 3 for investments in mortgage backed securities, as defined by the FASB standard for fair value measurements). As of September 30, 2019 and December 31, 2018, $4.9 million and $6.7 million, respectively, of equity securities presented within common stock and stock funds in the tables below, represent investments measured at fair value, using net asset value as a practical expedient, and are not categorized in the fair value hierarchy.

Any unrealized gain or loss in debt securities classified as available for sale is recorded as other comprehensive income. Unrealized gains and losses in equity securities, realized gains and losses in debt securities, interest income, and amortization of purchase discounts are included in interest and other income on the condensed consolidated statements of income and comprehensive income.

As of September 30, 2019 and December 31, 2018, equity securities and debt securities consisted primarily of investment-grade unsecured bonds, U.S. treasury securities, common stock and stock funds, and investments in mortgage backed securities. As of September 30, 2019 and December 31, 2018, the Company classified its investments in mortgage backed securities, which mature in November 2019 and September 2020, as held to maturity, and accordingly, these securities are stated at their amortized cost. The discount on the mortgage backed securities is being amortized to interest income based on an estimated yield and the maturity date of the securities.

Variable Interest Entities

Variable Interest Entities

In accordance with accounting standards for consolidation of variable interest entities ("VIEs"), the Company consolidates the Operating Partnership, 17 DownREIT limited partnerships (comprising nine communities), and seven co-investments as of September 30, 2019. As of December 31, 2018, the Company consolidated the Operating Partnership, 16 DownREIT limited partnerships (comprising eight communities), and eight co-investments. The Company consolidates these entities because it is deemed the primary beneficiary. Essex has no assets or liabilities other than its investment in the Operating Partnership. The consolidated total assets and liabilities related to the above consolidated co-investments and DownREIT limited partnerships, net of intercompany eliminations, were approximately $1.0 billion and $372.0 million, respectively, as of September 30, 2019 and $849.8 million and $261.7 million, respectively, as of December 31, 2018. Noncontrolling interests in these entities were $129.9 million and $64.5 million as of September 30, 2019 and December 31, 2018, respectively. The Company's financial risk in each VIE is limited to its equity investment in the VIE. As of September 30, 2019 and December 31, 2018, the Company did not have any VIEs of which it was not deemed to be the primary beneficiary.

Equity-based Compensation

Equity-based Compensation

The cost of share- and unit-based compensation awards is measured at the grant date based on the estimated fair value of the awards. The estimated fair value of stock options and restricted stock granted by the Company are being amortized over the vesting period. The estimated grant date fair values of the long term incentive plan units (discussed in Note 13, "Equity Based Compensation Plans," in the Company’s annual report on Form 10-K for the year ended December 31, 2018) are being amortized over the expected service periods.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

Management believes that the carrying amounts of the outstanding balances under its lines of credit, and notes and other receivables approximate fair value as of September 30, 2019 and December 31, 2018, because interest rates, yields, and other terms for these instruments are consistent with interest rates, yields, and other terms currently available for similar instruments. Management has estimated that the fair value of the Company’s fixed rate debt with a carrying value of $5.2 billion and $5.0 billion at September 30, 2019 and December 31, 2018, respectively, was approximately $5.5 billion and $5.0 billion, respectively. Management has estimated that the fair value of the Company’s $839.2 million and $619.6 million of variable rate debt at September 30, 2019 and December 31, 2018, respectively, was approximately $833.6 million and $615.2 million based on the terms of existing mortgage notes payable, unsecured debt, and variable rate demand notes compared to those available in the marketplace. Management believes that the carrying amounts of cash and cash equivalents, restricted cash, accounts payable and accrued liabilities, construction payables, other liabilities, and dividends payable approximate fair value as of September 30, 2019 and December 31, 2018 due to the short-term maturity of these instruments. Marketable securities, except mortgage backed securities, are carried at fair value as of September 30, 2019 and December 31, 2018.

At September 30, 2019, the Company’s investments in mortgage backed securities had a carrying value of $143.9 million and the Company estimated the fair value to be approximately $144.7 million. At December 31, 2018, the Company’s investments in mortgage backed securities had a carrying value of $127.2 million and the Company estimated the fair value to be approximately $129.5 million. The Company determines the fair value of the mortgage backed securities based on unobservable inputs (level 3 of the fair value hierarchy) considering the assumptions that market participants would make in valuing these securities. Assumptions such as estimated default rates and discount rates are used to determine the expected, discounted cash flows to estimate fair value.

Capitalization of Costs

Capitalization of Costs

The Company’s capitalized internal costs related to development and redevelopment projects were comprised primarily of employee compensation and totaled $4.3 million and $4.7 million during the three months ended September 30, 2019 and 2018, respectively, and $13.1 million and $14.2 million for the nine months ended September 30, 2019 and 2018, respectively. The Company capitalizes leasing commissions associated with the lease-up of development communities and amortizes the costs over the life of the leases. The amounts capitalized for leasing commissions are immaterial for all periods presented.

Co-investments

Co-investments

The Company owns investments in joint ventures in which it has significant influence, but its ownership interest does not meet the criteria for consolidation in accordance with U.S. GAAP. Therefore, the Company accounts for co-investments using the equity method of accounting. Under the equity method of accounting, the investment is carried at the cost of assets contributed, plus the Company's equity in earnings less distributions received and the Company's share of losses. The significant accounting policies of the Company’s co-investment entities are consistent with those of the Company in all material respects.

Upon the acquisition of a controlling interest of a co-investment, the co-investment entity is consolidated and a gain or loss is recognized upon the remeasurement of co-investments in the consolidated statement of income equal to the amount by which the fair value of the co-investment interest the Company previously owned exceeds its carrying value. A majority of the co-investments, excluding the preferred equity investments, compensate the Company for its asset management services and some of these investments may provide promote income if certain financial return benchmarks are achieved. Asset management fees are recognized when earned, and promote fees are recognized when the earnings events have occurred and the amount is determinable and collectible. Any promote fees are reflected in equity income from co-investments.

The Company reports investments in co-investments where accumulated distributions have exceeded the Company’s investment as distributions in excess of investments in co-investments in the accompanying condensed consolidated balance sheets. 

Changes in Accumulated Other Comprehensive Loss

Amounts reclassified from accumulated other comprehensive loss in connection with derivatives are recorded in interest expense on the condensed consolidated statements of income and comprehensive income. Realized gains and losses on available for sale debt securities are included in interest and other income on the condensed consolidated statements of income and comprehensive income.

Cash, Cash Equivalents and Restricted Cash

Cash, Cash Equivalents and Restricted Cash

Highly liquid investments with original maturities of three months or less when purchased are classified as cash equivalents. Restricted cash balances relate primarily to reserve requirements for capital replacement at certain communities in connection with the Company’s mortgage debt.

Accounting Estimates

Accounting Estimates

The preparation of condensed consolidated financial statements, in accordance with U.S. GAAP, requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. On an on-going basis, the Company evaluates its estimates, including those related to acquiring, developing and assessing the carrying values of its real estate portfolio, its investments in and advances to joint ventures and affiliates, its notes receivables, and its qualification as a real estate investment trust ("REIT"). The Company bases its estimates on historical experience, current market conditions, and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may vary from those estimates and those estimates could be different under different assumptions or conditions.

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Derivative Instruments and Hedging Activities

9 Months Ended

Sep. 30, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities

Derivative Instruments and Hedging Activities

As of September 30, 2019, the Company had entered into interest rate swap contracts with an aggregate notional amount of $175.0 million that effectively fixed the interest rate on the $175.0 million unsecured term loan at 2.3%. These derivatives qualify for hedge accounting.

As of September 30, 2019, the Company had interest rate caps, which are not accounted for as hedges, totaling a notional amount of $9.9 million that effectively limit the Company’s exposure to interest rate risk by providing a ceiling on the variable interest rate for $9.9 million of the Company’s tax exempt variable rate debt.

As of September 30, 2019 and December 31, 2018, the aggregate carrying value of the interest rate swap contracts was an asset of $0.5 million and $5.8 million, respectively, and is included in prepaid expenses and other assets on the condensed consolidated balance sheets. The aggregate carrying value of the interest rate caps was zero on the condensed consolidated balance sheets as of both September 30, 2019 and December 31, 2018.

Hedge ineffectiveness related to cash flow hedges, which is included in interest expense on the condensed consolidated statements of income and comprehensive income, was not significant for the three and nine months ended September 30, 2019 and 2018.

Additionally, the Company has total return swap contracts, with an aggregate notional amount of $255.6 million, that effectively convert $255.6 million of mortgage notes payable to a floating interest rate based on the Securities Industry and Financial Markets Association Municipal Swap Index ("SIFMA") plus a spread. The total return swaps provide fair market value protection on the mortgage notes payable to the counterparties during the initial period of the total return swap until the Company's option to call the mortgage notes at par can be exercised. The Company can currently call all of its total return swaps, with $255.6 million of the outstanding debt at par. These derivatives do not qualify for hedge accounting and had a carrying and fair value of zero at both September 30, 2019 and December 31, 2018. These total return swaps are scheduled to mature between September 2021 and November 2022. The realized gains of $2.2 million and $2.2 million for the three months ended September 30, 2019 and 2018, respectively, and $6.2 million and $6.7 million for the nine months ended September 30, 2019 and 2018, respectively, were reported in the condensed consolidated statements of income and comprehensive income as total return swap income.

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Related Party Transactions

9 Months Ended

Sep. 30, 2019

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

The Company charges certain fees relating to its co-investments for asset management, property management, development and redevelopment services. These fees from affiliates totaled $3.7 million and $3.6 million during the three months ended September 30, 2019 and 2018, respectively, and $10.6 million and $10.0 million during the nine months ended September 30, 2019 and 2018, respectively. All of these fees are net of intercompany amounts eliminated by the Company. The Company netted development and redevelopment fees of $1.2 million and $1.3 million against general and administrative expenses for the three months ended September 30, 2019 and 2018, respectively, and $3.6 million and $3.2 million for the nine months ended September 30, 2019 and 2018, respectively.

The Company’s Chairman and founder, Mr. George M. Marcus, is the Chairman of the Marcus & Millichap Company ("MMC"), which is a parent company of a diversified group of real estate service, investment, and development firms. Mr.

Marcus is also the Co-Chairman of Marcus & Millichap, Inc. ("MMI"), and Mr. Marcus owns a controlling interest in MMI, a national brokerage firm listed on the New York Stock Exchange. 

In August 2019, the Company provided an $89.0 million related party bridge loan to a property acquired by Wesco V. The note receivable accrues interest at LIBOR plus 1.30% and is scheduled to mature in December 2019. The bridge loan is classified within notes and other receivables in the accompanying condensed consolidated balance sheets and had an outstanding balance of $89.2 million as of September 30, 2019.

In August 2019, the Company provided a $44.4 million related party bridge loan to a property acquired by BEX IV. The note receivable accrues interest at 3.25% and is scheduled to mature in November 2019. The bridge loan is classified within notes and other receivables in the accompanying condensed consolidated balance sheets and had an outstanding balance of $44.5 million as of September 30, 2019.

In June 2019, the Company acquired Brio, a 300 unit apartment home community located in Walnut Creek, CA. The Company issued DownREIT limited partnership units to an affiliate of MMC, based on a contract price of $164.9 million. The property was encumbered by $98.7 million of mortgage debt which was assumed by the Company at the time of acquisition. As a result of this transaction, the Company consolidated the property, based on a VIE analysis performed by the Company.

In February 2019, the Company funded a $24.5 million preferred equity investment in an entity whose sponsor is an affiliate of MMC, which owns a multifamily development community located in Mountain View, CA. The investment has an initial preferred return of 11.0% and is scheduled to mature in February 2024.

In October 2018, the Company funded a $18.6 million preferred equity investment in an entity whose sponsor is an affiliate of MMC. The entity wholly owns a 268 apartment home community development located in Burlingame, CA. This investment will accrue interest based on an initial 12.00% preferred return. The investment is scheduled to mature in April 2024.

In May 2018, the Company made a commitment to fund a $26.5 million preferred equity investment in an entity whose sponsors include an affiliate of MMC. The entity wholly owns a 400 apartment home community located in Ventura, CA. This investment will accrue interest based on a 10.25% preferred return. The investment is scheduled to mature in May 2023. As of September 30, 2019, the Company had funded $21.9 million of the commitment. The remaining committed amount will be funded when requested by the sponsors.

In November 2017, the Company provided a $29.5 million related party bridge loan to a property acquired by BEX III. The note receivable accrued interest at 3.5% and was paid off in January 2018.

In March 2017, the Company converted its existing $15.3 million preferred equity investment in Sage at Cupertino, a 230 apartment home community located in San Jose, CA, into a 40.5% common equity ownership interest in the property. The Company issued DownREIT limited partnership units to the other members, including an MMC affiliate, based on an estimated property valuation of $90.0 million. At the time of the conversion, the property was encumbered by $52.0 million of mortgage debt. As a result of this transaction, the Company consolidates the property, based on a VIE analysis performed by the Company.

In 2015, the Company made preferred equity investments totaling $20.0 million in three entities affiliated with MMC that own apartment communities in California. The Company earned a 9.5% preferred return on each such investment. One $5.0 million investment, which was scheduled to mature in 2022, was fully redeemed in 2017. Another $5.0 million investment, which was scheduled to mature in 2022, was fully redeemed in 2018. The remaining investment was fully redeemed in February 2019.

As described in Note 5, Notes and Other Receivables, the Company has provided short-term loans to affiliates. As of September 30, 2019 and December 31, 2018, $4.3 million and $4.5 million, respectively, of short-term loans remained outstanding due from joint venture affiliates and is classified within notes and other receivables in the accompanying condensed consolidated balance sheets. In November 2016, the Company provided a $6.6 million mezzanine loan to a limited liability company in which MMC holds a significant ownership interest through subsidiaries. The mezzanine loan is classified within notes and other receivables in the accompanying condensed consolidated balance sheets and had an outstanding balance of $6.6 million as of both September 30, 2019 and December 31, 2018, respectively.

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Significant Transactions During the Nine Months Ended September 30, 2019 and Subsequent Events

9 Months Ended

Sep. 30, 2019

Business Combinations [Abstract]

Significant Transactions During the Nine Months Ended September 30, 2019 and Subsequent Events

Significant Transactions During The Nine Months Ended September 30, 2019 and Subsequent Events

Significant Transactions

Acquisitions

In March 2019, the Company acquired its joint venture partner’s 45.0% membership interest in One South Market, a multifamily community located in San Jose, CA, for total consideration of $80.6 million. Concurrent with the closing of the acquisition, $86.0 million in mortgage debt was repaid. As a result of this acquisition, the Company realized a gain on remeasurement of co-investment of $31.5 million upon consolidation. Furthermore, the Company recognized $0.8 million in promote income as a result of the transaction, which is included in equity income from co-investments on the condensed consolidated statements of income and comprehensive income.

In June 2019, the Company acquired Brio, a 300 unit apartment home community located in Walnut Creek, CA. The Company issued DownREIT limited partnership units to an affiliate of Marcus & Millichap Company, based on a contract price of $164.9 million. The property was encumbered by $98.7 million of mortgage debt which was assumed by the Company at the time of acquisition. As a result of this transaction, the Company consolidated the property, based on a VIE analysis performed by the Company. See Note 6, Related Party Transactions, for additional details.

In August 2019, Wesco V, LLC ("Wesco V"), one of the Company's joint ventures, acquired The Courtyards at 65th Street, a 331 unit apartment home community located in Emeryville, CA, for a total contract price of $178.0 million. The property was encumbered by an $89.0 million related party bridge loan from the Company, with an interest rate of LIBOR plus 1.30% and a maturity date of December 2019. See Note 6, Related Party Transactions, for additional details.

In August 2019, BEX IV, LLC ("BEX IV"), one of the Company's joint ventures, acquired 777 Hamilton, a 195 unit apartment home community located in Menlo Park, CA, for a total contract price of $148.0 million. The property is encumbered by a $44.4 million related party bridge loan from the Company, with an interest rate of 3.25% and a maturity date of November 2019. See "Co-investments" section below for further details related to the creation of BEX IV. See Note 6, Related Party Transactions, for additional details.

In September 2019, the Company acquired Township, a 132 unit apartment home community in Redwood City, CA, for a total contract price of $88.7 million. The property was encumbered by $44.3 million of mortgage debt, which was assumed by the Company at the time of acquisition.

Dispositions

In May 2019, the Company sold its 50.0% ownership interest in a co-investment that held land located in Oakland, CA for $6.1 million, resulting in a gain of $0.9 million within equity income from co-investments.

Co-Investments

Joint Ventures

In August 2019, the Company formed a new joint venture entity, BEX IV, with an institutional partner. The Company has a 50.1% ownership interest in the joint venture and an initial equity commitment of $52.2 million. The joint venture is unconsolidated for financial reporting purposes.

Preferred Equity Investments

In February 2019, the Company funded a $24.5 million related party preferred equity investment in a multifamily development community located in Mountain View, CA. The investment has an initial preferred return of 11.0% and is scheduled to mature in February 2024. See Note 6, Related Party Transactions, for additional details.

In February 2019, the Company received cash of $10.9 million, including an early redemption fee of $0.1 million, for the full redemption of a related party preferred equity investment in a joint venture that holds property in San Jose, CA. See Note 6, Related Party Transactions, for additional details.

In March 2019, the Company made a commitment to fund a $36.0 million preferred equity commitment in a multifamily development community located in Irvine, CA. The investment has an initial preferred return of 10.15% and is scheduled to mature in July 2022. As of September 30, 2019, the Company had funded $21.6 million of this commitment. The remaining committed amount is expected to be funded by the end of the year.

In April 2019, the Company received cash of $16.3 million, including an early redemption fee of $0.7 million, for the full redemption of a preferred equity investment in a joint venture that holds property in Santa Ana, CA.

In April 2019, the Company made a commitment to fund a $36.8 million preferred equity investment in a multifamily development community located in Oakland, CA. The investment has an initial preferred return of 10.25% and is scheduled to mature in April 2023. As of September 30, 2019, the Company had funded $15.0 million of this commitment. The remaining committed amount is expected to be funded by the end of the year.

In April 2019, the Company made a commitment to fund a $11.8 million preferred equity investment in a multifamily development community located in Oakland, CA. The investment has an initial preferred return of 11.0% and is scheduled to mature in April 2023. As of September 30, 2019, the Company had funded $5.5 million of this commitment. The remaining committed amount is expected to be funded by the end of the year.

In September 2019, the Company received cash of $14.8 million, including an early redemption fee of $0.3 million, for the full redemption of a preferred equity investment in a property located in Redmond, WA.

In September 2019, the Company received cash of $16.3 million, including an early redemption fee of $1.4 million, for the full redemption of a preferred equity investment in a property located in Seattle, WA.

Common Stock

In January 2019, the Company repurchased and retired 234,061 shares totaling $57.0 million, including commissions. In February 2019, the board of directors approved the replenishment of the stock repurchase plan such that, as of such date, the Company had $250.0 million of purchase authority remaining under the replenished plan. As of September 30, 2019, the Company had $250.0 million of purchase authority remaining under the stock repurchase plan.

During the nine months ended September 30, 2019, the Company issued 228,271 shares of common stock through its equity distribution program at an average price of $321.56 per share for proceeds of $73.4 million. There were no such sales during the nine months ended September 30, 2018.

Senior Unsecured Debt

In February 2019, the Operating Partnership issued $350.0 million of senior unsecured notes due on March 1, 2029, with a coupon rate of 4.000% (the "2029 Notes"), which are payable on March 1 and September 1 of each year, beginning on September 1, 2019. The 2029 Notes were offered to investors at a price of 99.188% of the principal amount thereof. The 2029 Notes are general unsecured senior obligations of the Operating Partnership, rank equally in right of payment with all other senior unsecured indebtedness of the Operating Partnership and are unconditionally guaranteed by the Company. In March 2019, the Operating Partnership issued an additional $150.0 million of the 2029 Notes at a price of 100.717% of the principal amount thereof. These additional notes have substantially identical terms as the 2029 Notes issued in February 2019. The Company used the net proceeds of these offerings to repay indebtedness under its unsecured lines of credit and for other general corporate and working capital purposes.

In August 2019, the Operating Partnership issued $400.0 million of senior unsecured notes due on January 15, 2030, with a coupon rate of 3.000% (the "2030 Notes"), which are payable on January 15 and July 15 of each year, beginning on January 15, 2020. The 2030 Notes were offered to investors at a price of 98.632% of the principal amount thereof. The 2030 Notes are general unsecured senior obligations of the Operating Partnership, rank equally in right of payment with all other senior unsecured indebtedness of the Operating Partnership and are unconditionally guaranteed by the Company. The Company used the net proceeds of this offering to prepay, with no prepayment penalties, certain secured indebtedness under outstanding mortgage notes, to repay indebtedness under its unsecured lines of credit and for other general corporate and working capital purposes.

Mortgage Notes Payable

In January 2019, the Company repaid $290.0 million in secured mortgage notes payable with a coupon rate of 5.57% and a stated maturity date of May 2019. The Company realized a gain on early extinguishment of debt of $1.4 million.

In September 2019, the Company repaid $289.1 million in secured mortgage notes payable with a coupon rate of 5.69% and a stated maturity date of September 2020. The Company realized a gain on early extinguishment of debt of $5.5 million.

Subsequent Events

In October 2019, the Operating Partnership issued an additional $150.0 million of the 2030 Notes at a price of 101.685% of the principal amount thereof. The notes were issued as additional notes under the 2030 Notes indenture and have substantially identical terms as the 2030 Notes issued in August 2019.

In October 2019, the Company received cash of $15.8 million, including an early redemption fee of $0.2 million, for the full redemption of a preferred equity investment in a property located in San Jose, CA.

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Net Income Per Common Share and Net Income Per Common Unit (Tables)

9 Months Ended

Sep. 30, 2019

Net Income Per Share and Net Income Per Unit [Line Items]

Schedule of net income per common share

Essex Property Trust, Inc.

	Three Months Ended September 30, 2019					Three Months Ended September 30, 2018
	Income		Weighted- average Common Shares	Per Common Share Amount		Income		Weighted- average Common Shares	Per Common Share Amount
Basic:
Net income available to common stockholders	$	99,335	65,850,524	$	1.51	$	80,975	66,052,108	$	1.23
Effect of Dilutive Securities:
Stock options	—		122,561			—		51,704
Diluted:
Net income available to common stockholders	$	99,335	65,973,085	$	1.51	$	80,975	66,103,812	$	1.22

	Nine Months Ended September 30, 2019					Nine Months Ended September 30, 2018
	Income		Weighted- average Common Shares	Per Common Share Amount		Income		Weighted- average Common Shares	Per Common Share Amount
Basic:
Net income available to common stockholders	$	310,468	65,757,914	$	4.72	$	272,333	66,047,990	$	4.12
Effect of Dilutive Securities:
Stock options	—		99,746			—		45,014
Diluted:
Net income available to common stockholders	$	310,468	65,857,660	$	4.71	$	272,333	66,093,004	$	4.12

Essex Portfolio, L.P. [Member]

Net Income Per Share and Net Income Per Unit [Line Items]

Schedule of net income per common share

Essex Portfolio, L.P.

	Three Months Ended September 30, 2019					Three Months Ended September 30, 2018
	Income		Weighted- average Common Units	Per Common Unit Amount		Income		Weighted- average Common Units	Per Common Unit Amount
Basic:
Net income available to common unitholders	$	102,799	68,148,913	$	1.51	$	83,764	68,325,091	$	1.23
Effect of Dilutive Securities:
Stock options	—		122,561			—		51,704
Diluted:
Net income available to common unitholders	$	102,799	68,271,474	$	1.51	$	83,764	68,376,795	$	1.23

	Nine Months Ended September 30, 2019					Nine Months Ended September 30, 2018
	Income		Weighted- average Common Units	Per Common Unit Amount		Income		Weighted- average Common Units	Per Common Unit Amount
Basic:
Net income available to common unitholders	$	321,331	68,058,802	$	4.72	$	281,714	68,321,153	$	4.12
Effect of Dilutive Securities:
Stock options	—		99,746			—		45,014
Diluted:
Net income available to common unitholders	$	321,331	68,158,548	$	4.71	$	281,714	68,366,167	$	4.12

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Organization and Basis of Presentation - Summary of Financial Securities (Details) - USD ($) $ in Thousands	9 Months Ended		12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Equity securities:
Gross Unrealized Gain (Loss)	$ 4,280	$ 426
Carrying Value	4,900		$ 6,700
Held to maturity
Equity and Debt Securities, Amortized Cost	214,858		211,960
Equity and Debt Securities, Gross Unrealized Gain (Loss)	2,036		(2,415)
Equity and Debt Securities, Marketable Securities	216,894		209,545
Investment funds - debt securities [Member]
Equity securities:
Amortized Cost/Cost	27,883		31,934
Gross Unrealized Gain (Loss)	576		(568)
Carrying Value	28,459		31,366
Common stock and stock funds [Member]
Equity securities:
Amortized Cost/Cost	37,123		39,731
Gross Unrealized Gain (Loss)	1,465		(1,671)
Carrying Value	38,588		38,060
Investment funds - U.S. treasuries [Member]
Available for sale
Amortized Cost/Cost	4,915		8,983
Gross Unrealized Gain (Loss)	(15)		(31)
Carrying Value	4,900		8,952
Investment-grade unsecured bonds [Member]
Available for sale
Amortized Cost/Cost	1,048		4,125
Gross Unrealized Gain (Loss)	10		(145)
Carrying Value	1,058		3,980
Mortgage backed securities [Member]
Held to maturity
Amortized Cost/Cost	143,889		127,187
Gross Unrealized Gain (Loss)	0		0
Carrying Value	$ 143,889		$ 127,187

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Organization and Basis of Presentation - Cash, Cash Equivalents and Restricted Cash And Cash Equivalents (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018	Sep. 30, 2018	Dec. 31, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Cash and cash equivalents-unrestricted	$ 74,031	$ 134,465	$ 157,279	$ 44,620
Cash and cash equivalents-restricted	17,695	16,930	17,347	16,506
Total unrestricted and restricted cash and cash equivalents shown in the condensed consolidated statement of cash flows	$ 91,726	$ 151,395	$ 174,626	$ 61,126

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Condensed Consolidated Statement of Equity (Parenthetical) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Statement of Stockholders' Equity [Abstract]
Common stock dividends (in dollars per share)	$ 1.95	$ 1.86	$ 5.85	$ 5.58

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Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Rental properties:
Land and land improvements	$ 2,766,344	$ 2,701,356
Buildings and improvements	11,180,806	10,664,745
Total rental properties	13,947,150	13,366,101
Less: accumulated depreciation	(3,567,632)	(3,209,548)
Net real estate	10,379,518	10,156,553
Real estate under development	562,338	454,629
Co-investments	1,413,861	1,300,140
Total real estate	12,355,717	11,911,322
Cash and cash equivalents-unrestricted	74,031	134,465
Cash and cash equivalents-restricted	17,695	16,930
Marketable securities	216,894	209,545
Notes and other receivables (includes related party receivables of $144.6 million and $11.1 million as of September 30, 2019 and December 31, 2018, respectively)	216,541	71,895
Operating lease right-of-use assets	75,478	0
Prepaid expenses and other assets	41,536	39,439
Total assets	12,997,892	12,383,596
LIABILITIES AND EQUITY/CAPITAL
Unsecured debt, net	4,686,171	3,799,316
Mortgage notes payable, net	1,141,970	1,806,626
Lines of credit	220,000	0
Accounts payable and accrued liabilities	193,341	127,086
Construction payable	53,214	59,345
Dividends/Distributions payable	135,492	128,529
Operating lease liabilities	77,495
Other liabilities	36,128	33,375
Total liabilities	6,543,811	5,954,277
Commitments and contingencies
Redeemable noncontrolling interest	39,077	35,475
Equity/Capital:
Common stock; $0.0001 par value, 670,000,000 shares authorized; 66,081,635 and 65,890,322 shares issued and outstanding, respectively	7	7
Additional paid-in capital	7,131,642	7,093,079
Distributions in excess of accumulated earnings	(887,521)	(812,796)
Limited Partners:
Accumulated other comprehensive loss, net	(19,028)	(13,217)
Total stockholders' equity	6,225,100	6,267,073
Noncontrolling interest	189,904	126,771
Total equity	6,415,004	6,393,844
Total liabilities and equity/capital	12,997,892	12,383,596
Essex Portfolio, L.P. [Member]
Rental properties:
Land and land improvements	2,766,344	2,701,356
Buildings and improvements	11,180,806	10,664,745
Total rental properties	13,947,150	13,366,101
Less: accumulated depreciation	(3,567,632)	(3,209,548)
Net real estate	10,379,518	10,156,553
Real estate under development	562,338	454,629
Co-investments	1,413,861	1,300,140
Total real estate	12,355,717	11,911,322
Cash and cash equivalents-unrestricted	74,031	134,465
Cash and cash equivalents-restricted	17,695	16,930
Marketable securities	216,894	209,545
Notes and other receivables (includes related party receivables of $144.6 million and $11.1 million as of September 30, 2019 and December 31, 2018, respectively)	216,541	71,895
Operating lease right-of-use assets	75,478
Prepaid expenses and other assets	41,536	39,439
Total assets	12,997,892	12,383,596
LIABILITIES AND EQUITY/CAPITAL
Unsecured debt, net	4,686,171	3,799,316
Mortgage notes payable, net	1,141,970	1,806,626
Lines of credit	220,000	0
Accounts payable and accrued liabilities	193,341	127,086
Construction payable	53,214	59,345
Dividends/Distributions payable	135,492	128,529
Operating lease liabilities	77,495
Other liabilities	36,128	33,375
Total liabilities	6,543,811	5,954,277
Commitments and contingencies
Redeemable noncontrolling interest	39,077	35,475
General Partner:
Common equity (66,081,635 and 65,890,322 units issued and outstanding, respectively)	6,244,128	6,280,290
Limited Partners:
Common equity (2,298,237 and 2,305,389 units issued and outstanding, respectively)	57,002	59,061
Accumulated other comprehensive loss, net	(15,752)	(9,738)
Total partners' capital	6,285,378	6,329,613
Noncontrolling interest	129,626	64,231
Total capital	6,415,004	6,393,844
Total liabilities and equity/capital	$ 12,997,892	$ 12,383,596

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Lease Agreements - Company as Lessee - Narrative and Components of Leases (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2019	Dec. 31, 2018
Lessee, Lease, Description [Line Items]
Office lease, renewal term		5 years
Operating lease right-of-use assets	$ 75,478	$ 75,478	$ 0
Total leased assets	75,478	75,478
Operating lease liabilities	77,495	77,495
Total lease liabilities	77,495	77,495
Lease, Cost [Abstract]
Operating lease cost	1,686	5,059
Variable lease cost	109	622
Short-term lease cost	171	455
Sublease income	(109)	(326)
Total lease cost	1,857	5,810
Operating lease right-of-use assets
Lessee, Lease, Description [Line Items]
Operating lease right-of-use assets	75,478	75,478
Operating lease liabilities
Lessee, Lease, Description [Line Items]
Operating lease liabilities	$ 77,495	$ 77,495
Minimum
Lessee, Lease, Description [Line Items]
Office lease term of contract		5 years
Ground lease term		20 years
Ground lease, renewal term		10 years
Maximum
Lessee, Lease, Description [Line Items]
Office lease term of contract		10 years
Ground lease term		85 years
Ground lease, renewal term		39 years

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Segment Information (Details) $ in Thousands	1 Months Ended		3 Months Ended		9 Months Ended
	Sep. 30, 2019 USD ($)	Jan. 31, 2019 USD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($) segment	Sep. 30, 2018 USD ($)	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Segment Reporting [Abstract]
Number of reportable operating segments defined by geographical regions (in segments) | segment					3
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenues			$ 366,932	$ 350,917	$ 1,084,790	$ 1,046,895
Net operating income			262,033	250,835	781,533	753,199
Corporate-level property management expenses			(8,255)	(7,761)	(24,620)	(23,313)
Depreciation and amortization			(120,809)	(120,852)	(360,842)	(359,287)
General and administrative			(11,345)	(10,601)	(38,731)	(36,539)
Expensed acquisition and investment related costs			(13)	(31)	(69)	(156)
Gain on sale of real estate and land			0	0	0	22,244
Interest expense			(54,896)	(55,196)	(162,651)	(166,335)
Total return swap income			2,154	2,184	6,174	6,682
Interest and other income			8,685	8,437	29,293	21,241
Equity income from co-investments			21,700	16,788	54,935	64,611
Deferred tax expense on unrealized gain on unconsolidated co-investment			(1,457)	0	(1,457)	0
Gain on early retirement of debt, net	$ 5,500	$ 1,400	5,475	0	7,143	0
Gain on remeasurement of co-investment			0	0	31,535	0
Net income			105,700	86,110	329,266	289,159
Net reportable operating segment - real estate assets	10,379,518		10,379,518		10,379,518		$ 10,156,553
Real estate under development	562,338		562,338		562,338		454,629
Co-investments	1,413,861		1,413,861		1,413,861		1,300,140
Cash and cash equivalents, including restricted cash	91,726		91,726	174,626	91,726	174,626	151,395	$ 61,126
Marketable securities	216,894		216,894		216,894		209,545
Notes and other receivables	216,541		216,541		216,541		71,895
Operating lease right-of-use assets	75,478		75,478		75,478		0
Prepaid expenses and other assets	41,536		41,536		41,536		39,439
Total assets	12,997,892		12,997,892		12,997,892		12,383,596
Rental and Other Property Revenues [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenues			364,504	348,610	1,077,767	1,040,083
Management and Other Fees From Affiliates Income [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenues			2,428	2,307	7,023	6,812
Operating Segments [Member] | Southern California [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net operating income			106,951	104,732	323,073	314,977
Net reportable operating segment - real estate assets	4,245,335		4,245,335		4,245,335		4,350,377
Operating Segments [Member] | Southern California [Member] | Rental and Other Property Revenues [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenues			152,312	148,575	455,302	442,382
Operating Segments [Member] | Northern California [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net operating income			105,381	97,244	310,407	288,222
Net reportable operating segment - real estate assets	4,623,559		4,623,559		4,623,559		4,270,238
Operating Segments [Member] | Northern California [Member] | Rental and Other Property Revenues [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenues			144,124	131,538	420,544	389,750
Operating Segments [Member] | Seattle Metro [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net operating income			43,701	40,999	129,013	123,432
Net reportable operating segment - real estate assets	1,444,045		1,444,045		1,444,045		1,472,916
Operating Segments [Member] | Seattle Metro [Member] | Rental and Other Property Revenues [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenues			61,657	59,231	182,738	176,740
Other real estate assets [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net operating income			6,000	7,860	19,040	26,568
Net reportable operating segment - real estate assets	$ 66,579		66,579		66,579		$ 63,022
Other real estate assets [Member] | Rental and Other Property Revenues [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenues			$ 6,411	$ 9,266	$ 19,183	$ 31,211