Net Income Per Common Share and Net Income Per Common Unit

12 Months Ended

Dec. 31, 2022

Net Income Per Common Share and Net Income Per Common Unit

Essex Property Trust, Inc.

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


	2022					2021					2020
	Income		Weighted- average Common Shares	Per Common Share Amount		Income		Weighted- average Common Shares	Per Common Share Amount		Income		Weighted- average Common Shares	Per Common Share Amount
Basic:
Net income available to common stockholders	$	408,315	65,079,764	$	6.27	$	488,554	65,051,465	$	7.51	$	568,870	65,454,057	$	8.69
Effect of Dilutive Securities
Stock options			18,422			—		37,409			—		16,678
DownREIT units	—		—			—		—			783		94,247
Diluted:
Net income available to common stockholders	$	408,315	65,098,186	$	6.27	$	488,554	65,088,874	$	7.51	$	569,653	65,564,982	$	8.69

The table above excludes from the calculations of diluted earnings per share weighted average convertible OP Units of 2,276,341, 2,289,391 and 2,296,608, which include vested Series Z-1 Incentive Units, 2014 Long-Term Incentive Plan Units, and 2015 Long-Term Incentive Plan Units, for the years ended December 31, 2022, 2021 and 2020, respectively, because they were anti-dilutive. The related income allocated to these convertible OP Units aggregated $14.3 million, $17.2 million and $20.0 million for the years ended December 31, 2022, 2021 and 2020, respectively.

Stock options of 253,845, 116,380, and 403,458 for the years ended December 31, 2022, 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 years ended and, therefore, were anti-dilutive.

Essex Portfolio, L.P.

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


	2022					2021					2020
	Income		Weighted- average Common Units	Per Common Unit Amount		Income		Weighted- average Common Units	Per Common Unit Amount		Income		Weighted- average Common Units	Per Common Unit Amount
Basic:
Net income available to common unitholders	$	422,612	67,356,105	$	6.27	$	505,745	67,340,856	$	7.51	$	588,782	67,750,665	$	8.69
Effect of Dilutive Securities
Stock options	—		18,422			—		37,409			—		16,678
DownREIT units	—		—			—		—			783		94,247
Diluted:
Net income available to common unitholders	$	422,612	67,374,527	$	6.27	$	505,745	67,378,265	$	7.51	$	589,565	67,861,590	$	8.69

Stock options of 253,845, 116,380, and 403,458, for the years ended December 31, 2022, 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 years ended and, therefore, were anti-dilutive.