Earnings and Dividends per Share and Unit

6 Months Ended

Jun. 30, 2021

Earnings and Dividends per Share and Unit

Note 5 — Earnings and Dividends per Share and Unit

AIR and the AIR Operating Partnership calculate basic earnings (loss) per common share and basic earnings (loss) per common unit based on the weighted-average number of shares of Common Stock and common partnership units outstanding. We calculate diluted

earnings (loss) per share and diluted earnings (loss) per unit taking into consideration dilutive common stock and common partnership unit equivalents and dilutive convertible securities outstanding during the period.

Our common stock and common partnership unit equivalents include options to purchase shares of Common Stock, which, if exercised, would result in AIR’s issuance of additional shares and the AIR Operating Partnership’s issuance to AIR of additional common partnership units equal to the number of shares purchased under the options. These equivalents also include unvested total shareholder return (“TSR”) restricted stock awards that do not meet the definition of participating securities, which would result in an increase in the number of shares of Common Stock and common partnership units outstanding equal to the number of the shares that vest. Common partnership unit equivalents also include unvested long-term incentive partnership units. We include in the denominator securities with dilutive effect in calculating diluted earnings (loss) per share and per unit during these periods.

Our restricted stock awards that are subject to time-based vesting receive non-forfeitable dividends similar to shares of Common Stock and common partnership units prior to vesting, and our TSR long-term incentive partnership units receive non-forfeitable distributions based on specified percentages of the distributions paid to common partnership units prior to vesting and conversion. The unvested restricted shares and units related to these awards are participating securities. We include the effect of participating securities in basic and diluted earnings (loss) per share and unit computations using the two-class method of allocating distributed and undistributed earnings when the two-class method is more dilutive than the treasury stock method.

In our condensed consolidated statements of operations, noncontrolling interest in consolidated real estate partnerships is related to both continuing and discontinued operations. For purposes of our earnings (loss) per share calculation, we have appropriately allocated the noncontrolling interest in consolidated real estate partnerships for the three and six months ended June 30, 2020. Please see Note 9 for detail of noncontrolling interest in consolidated real estate partnerships associated with discontinued operations.

Reconciliations of the numerator and denominator in the calculations of basic and diluted earnings (loss) per share and per unit are as follows (in thousands, except per share and per unit data):


	Three Months Ended June 30, 2021								Six Months Ended June 30, 2021
	Income (Numerator)			Shares (Denominator)		Per Share Amount			Income (Numerator)		Shares (Denominator)		Per Share Amount
Basic earnings (loss) per share:
Net income (loss) attributable to AIR common stockholders	$	(18,030	)		154,608	$	(0.12	)	$	65,166		151,609	$	0.43
Diluted earnings (loss) per share:
Effect of dilutive securities		—			—		—			—		474		—
Net income (loss) attributable to AIR common stockholders	$	(18,030	)		154,608	$	(0.12	)	$	65,166		152,083	$	0.43

Non-dilutive share equivalents outstanding					8,116							8,090


	Three Months Ended June 30, 2020						Six Months Ended June 30, 2020
	Income (Numerator)		Shares (Denominator)		Per Share Amount		Income (Numerator)		Shares (Denominator)		Per Share Amount
Basic earnings (loss) per share:
Income from continuing operations attributable to AIR	$	35,970		119,959	$	0.30	$	38,481		119,953	$	0.32
Income from discontinued operations attributable to AIR		3,242		119,959		0.03		7,410		119,953		0.06
Net income attributable to AIR common stockholders	$	39,212		119,959	$	0.33	$	45,891		119,953	$	0.38
Diluted earnings (loss) per share:
Effect of dilutive securities		—		15		—		—		115		—
Net income (loss) attributable to AIR common stockholders	$	39,212		119,974	$	0.33	$	45,891		120,068	$	0.38

Non-dilutive share equivalents outstanding				8,929						8,260


	Three Months Ended June 30, 2021								Six Months Ended June 30, 2021
	Income (Numerator)			Units (Denominator)		Per Unit Amount			Income (Numerator)		Units (Denominator)		Per Unit Amount
Basic earnings (loss) per unit:
Net income (loss) attributable to the AIR Operating Partnership's common unitholders	$	(18,975	)		162,698	$	(0.12	)	$	68,657		159,701	$	0.43
Diluted earnings (loss) per unit:
Effect of dilutive securities		—			—		—			—		474		—
Net income (loss) attributable to the AIR Operating Partnership's common unitholders	$	(18,975	)		162,698	$	(0.12	)	$	68,657		160,175	$	0.43

Non-dilutive partnership unit equivalents outstanding					1,885							1,594


	Three Months Ended June 30, 2020						Six Months Ended June 30, 2020
	Income (Numerator)		Units (Denominator)		Per Unit Amount		Income (Numerator)		Units (Denominator)		Per Unit Amount
Basic earnings (loss) per unit:
Income from continuing operations attributable to the AIR Operating Partnership	$	38,077		126,399	$	0.30	$	40,956		126,460	$	0.32
Income from discontinued operations attributable to the AIR Operating Partnership		3,242		126,399		0.03		7,410		126,460		0.06
Net income attributable to the AIR Operating Partnership's common unitholders	$	41,319		126,399	$	0.33	$	48,366		126,460	$	0.38
Diluted earnings (loss) per unit:
Effect of dilutive securities		—		15		—		—		176		—
Net income (loss) attributable to the AIR Operating Partnership's common unitholders	$	41,319		126,414	$	0.33	$	48,366		126,636	$	0.38

Non-dilutive partnership unit equivalents outstanding				2,081						1,214

The AIR Operating Partnership has various classes of preferred OP Units, which may be redeemed at the holders’ option. The AIR Operating Partnership may redeem these units for cash, or at its option, shares of Common Stock. As of June 30, 2021, these preferred OP Units were potentially redeemable for approximately 1.7 million shares of Common Stock (based on the period end market price) or cash. The AIR Operating Partnership has a redemption policy that requires cash settlement of redemption requests for the preferred OP Units, subject to limited exceptions. Accordingly, we have excluded these securities from earnings per share and unit computations for the periods presented above.

Dividends and distributions paid per share of Common Stock and per common unit were as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Dividends and distributions paid	$	0.43	$	0.41	$	0.86	$	0.82