Net Income Per Common Share and Net Income Per Common Unit

6 Months Ended

Jun. 30, 2021

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 June 30, 2021					Three Months Ended June 30, 2020
	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	$	64,846	65,001,677	$	1.00	$	84,458	65,412,407	$	1.29
Effect of Dilutive Securities:
Stock options	—		79,069			—		15,528

Diluted:
Net income available to common stockholders	$	64,846	65,080,746	$	1.00	$	84,458	65,427,935	$	1.29


	Six Months Ended June 30, 2021					Six Months Ended June 30, 2020
	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	$	233,290	64,995,682	$	3.59	$	399,464	65,728,119	$	6.08
Effect of Dilutive Securities:
Stock options	—		52,334			—		32,981
DownREIT units	—		—			392		94,247
Diluted:
Net income available to common stockholders	$	233,290	65,048,016	$	3.59	$	399,856	65,855,347	$	6.07

The table above excludes from the calculations of diluted earnings per share weighted average convertible OP Units of 2,293,760 and 2,295,750, which include vested 2014 Long-Term Incentive Plan Units, and 2015 Long-Term Incentive Plan Units for the three months ended June 30, 2021 and 2020, respectively, and 2,293,782 and 2,297,966 for the six months ended June 30, 2021 and 2020, respectively, because they were anti-dilutive. The related income allocated to these convertible OP Units aggregated $2.3 million and $3.0 million for the three months ended June 30, 2021 and 2020, respectively, and $8.2 million and $14.0 million for the six months ended June 30, 2021 and 2020, respectively. Additionally, the table excludes all DownREIT 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 136,172 and 431,253 for the three months ended June 30, 2021 and 2020, respectively, and zero and 290,570 for the six months ended June 30, 2021 and 2020, 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 June 30, 2021					Three Months Ended June 30, 2020
	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	$	67,134	67,295,437	$	1.00	$	87,422	67,708,157	$	1.29
Effect of Dilutive Securities:
Stock options	—		79,069			—		15,528

Diluted:
Net income available to common unitholders	$	67,134	67,374,506	$	1.00	$	87,422	67,723,685	$	1.29


	Six Months Ended June 30, 2021					Six Months Ended June 30, 2020
	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	$	241,525	67,289,464	$	3.59	$	413,414	68,026,084	$	6.08
Effect of Dilutive Securities:
Stock options	—		52,334			—		32,981
DownREIT units	—		—			392		94,247
Diluted:
Net income available to common unitholders	$	241,525	67,341,798	$	3.59	$	413,806	68,153,312	$	6.07

Stock options of 136,172 and 431,253 for the three months ended June 30, 2021 and 2020, respectively, zero and 290,570 for the six months ended June 30, 2021 and 2020, 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 table excludes all DownREIT 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.