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What changed in Essex Property Trust's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Essex Property Trust's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+297 added−277 removedSource: 10-K (2026-02-20) vs 10-K (2025-02-21)

Top changes in Essex Property Trust's 2025 10-K

297 paragraphs added · 277 removed · 233 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

29 edited+32 added−16 removed31 unchanged
Biggest changeThe Company also supports employee-led resource groups which are open to all employees and intended to foster a sense of community and inclusion for associates at the Company that are intended to engage, educate, enable, and empower the Company’s employees. 5 Table of Contents Training and Development The Company values leadership at every level and enables the same by providing opportunities for all associates to develop personal and professional skills through programs that encourage associate retention and advancement.
Biggest changeTraining and Development The Company values leadership at every level and enables the same by providing opportunities for all associates to develop personal and professional skills through programs that encourage associate retention and advancement. The Company currently offers training courses to its associates via Workday Learning, and its associates spent 16,708 hours learning in 2025.
The Company intends to achieve this by utilizing the strategies set forth below: 2 Table of Contents • Property Management – Oversee delivery and quality of the housing provided to our tenants and manage the properties financial performance. • Capital Preservation – The Company’s asset management services are responsible for the planning, budgeting and completion of major capital improvement projects at the Company’s communities. • Business Planning and Control – Comprehensive business plans are implemented in conjunction with significant investment decisions.
The Company intends to achieve this by utilizing the strategies set forth below: 2 Table of Contents • Property Management – Oversee delivery and quality of the housing provided to our tenants and manage the properties’ financial performance. • Capital Preservation – The Company’s asset management services are responsible for the planning, budgeting and completion of major capital improvement projects at the Company’s communities. • Business Planning and Control – Comprehensive business plans are implemented in conjunction with significant investment decisions.
WORKING CAPITAL 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 2025.
WORKING CAPITAL 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 2026.
If the demand for the Company’s communities is reduced or if competitors develop and/or acquire competing housing, rental rates and occupancy may drop which may have a material adverse effect on the Company’s financial condition and results of operations. The Company faces competition from other REITs, businesses and other entities in the acquisition, development and operation of apartment communities.
If the demand for the Company’s communities is reduced or if competitors develop and/or acquire competing housing, rental rates and occupancy may drop which may have a material adverse effect on the Company’s financial condition and results of operations. 7 Table of Contents The Company faces competition from other REITs, businesses and other entities in the acquisition, development and operation of apartment communities.
Essex is the sole general partner of the Operating Partnership and as of December 31, 2024, had an approximately 96.5% general partner interest in the Operating Partnership. In this report, the terms “Company,” “we,” “us,” and “our” also refer to Essex Property Trust, Inc., the Operating Partnership and those entities/subsidiaries owned or controlled by Essex and/or the Operating Partnership.
Essex is the sole general partner of the Operating Partnership and as of December 31, 2025, had an approximately 96.6% general partner interest in the Operating Partnership. In this report, the terms “Company,” “we,” “us,” and “our” also refer to Essex Property Trust, Inc., the Operating Partnership and those entities/subsidiaries owned or controlled by Essex and/or the Operating Partnership.
Additionally, the Company offers retirement support, associate discount programs, a mental health program (which includes counseling and coaching sessions for mental well-being support at no cost), refresh days for our operations teams, and health benefit credits for participation in wellness programs. Compensation and Benefits The Company offers competitive compensation to secure and retain top talent.
Additionally, the Company offers retirement support, associate discount programs, a mental health program (which includes counseling and coaching sessions for mental well-being support at no cost), and health benefit credits for participation in wellness programs. Compensation and Benefits The Company offers competitive compensation to secure and retain top talent.
Long Term Debt During 2024, the Company made regularly scheduled principal payments of $3.1 million to its secured mortgage notes payable at an average interest rate of 3.5%.
Long Term Debt During 2025, the Company made regularly scheduled principal payments of $2.5 million to its secured mortgage notes payable at an average interest rate of 3.5%.
The Company encourages internal promotions and hiring for open positions, and the executive team actively mentors the Company’s top talent to ensure strong leadership at the Company for the future. 38% of the Company’s associates have approached or surpassed the Company’s average tenure of 6.57 years, with 22% reaching beyond 10 years of service.
The Company encourages internal promotions and hiring for open positions, and the executive team actively mentors the Company’s top talent to ensure strong leadership at the Company for the future. 36% of the Company’s associates have approached or surpassed the Company’s average tenure of 6.71 years, with 24% reaching beyond 10 years of service.
As of December 31, 2024, the Company owned or had ownership interests in 255 operating apartment communities, aggregating 62,157 apartment homes, excluding the Company’s ownership in preferred equity co-investments, loan investments, two operating commercial buildings, and a development pipeline comprised of various predevelopment projects (collectively, the “Portfolio”). The Company’s website address is https://www.essex.com.
As of December 31, 2025, the Company owned or had ownership interests in 259 operating apartment communities, aggregating 63,077 apartment homes, excluding the Company’s ownership in preferred equity co-investments, loan investments, two operating commercial buildings, and a development pipeline comprised of one consolidated project and various predevelopment projects (collectively, the “Portfolio”). The Company’s website address is https://www.essex.com.
The Company earns a preferred rate of return on these investments. HUMAN CAPITAL MANAGEMENT Company Overview and Values The Company’s mission is to create quality communities in premier locations and it is critical to the Company’s mission that it attracts, trains and retains a talented and diverse team by providing a compelling place to work and opportunities for professional growth.
HUMAN CAPITAL MANAGEMENT Company Overview and Values The Company’s mission is to create quality communities in premier locations and it is critical to the Company’s mission that it attracts, trains and retains a talented team by providing a compelling place to work and opportunities for professional growth.
In March 2024, the Operating Partnership issued $350.0 million of senior unsecured notes due on April 1, 2034 with a coupon rate of 5.500% per annum (the "2034 Notes"), which are payable on April 1 and October 1 of each year, beginning on October 1, 2024.
In February 2025, the Operating Partnership issued $400.0 million of senior unsecured notes due on April 1, 2035 with a coupon rate of 5.375% per annum (the “2035 Notes”), which are payable on April 1 and October 1 of each year, beginning on October 1, 2025.
The Company’s volunteer program is aimed at supporting and encouraging eligible associates to become actively involved in their communities through the Company’s support of charity initiatives and offering paid hours for volunteer time.
The Company’s volunteer program is aimed at supporting and encouraging eligible associates to become actively involved in their communities through the Company’s support of charity initiatives and offering paid hours for volunteer time. In 2025, Essex associates completed 572 volunteer hours. Additionally, the Company’s “Essex Cares” program provides direct aid to the Company’s residents, associates, and local communities.
See the discussion under the caption, “Risks Related to Our Real Estate Investments and Operations - The Company’s portfolio may have environmental liabilities. ” in Item 1A, Risk Factors, for information concerning the potential effect of environmental regulations on its operations, which discussion is incorporated by reference into this Item 1. 7 Table of Contents OTHER MATTERS Certain Policies of the Company The Company intends to continue to operate in a manner that will not subject it to regulation under the Investment Company Act of 1940.
See the discussion under the caption, “Risks Related to Our Real Estate Investments and Operations - The Company’s portfolio may have environmental liabilities. ” in Item 1A, Risk Factors, for information concerning the potential effect of environmental regulations on its operations, which discussion is incorporated by reference into this Item 1.
The Company’s culture supports its mission and is guided by its core values: to act with integrity, to care about what matters, to do right with urgency, to lead at every level and to seek fairness. The Company is headquartered in San Mateo, CA, and has regional corporate offices in Woodland Hills, CA; Irvine, CA and Bellevue, WA.
The Company’s culture supports its mission and is guided by its core values: to act with integrity, to care about what matters, to do right with urgency, to lead at every level, and to seek fairness.
As of December 31, 2024, the Company had 1,715 employees, 99.8% of whom were full-time employees. A total of 1,293 employees worked on-site at our operating communities and 422 worked in our corporate offices.
As of December 31, 2025, the Company had 1,689 employees, 99.8% of whom were full-time. A total of 1,267 employees worked on-site at our operating communities, and 422 employees worked in our corporate offices. Workplace Culture The Company believes that a strong employee culture is supported by workforce capability, engagement, and connection.
Prior to its maturity in July 2024 the line of credit facility was amended such that the line’s capacity was increased from $35.0 million to $75.0 million and the scheduled maturity date was extended to July 2026. 4 Table of Contents Equity Transactions In August 2024, 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 “2024 ATM Program”).
Equity Transactions In August 2024, the Company entered into an 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 “2024 ATM Program”).
In September 2024, the scheduled maturity date was extended from January 2027 to January 2029. The Company’s $75.0 million working capital unsecured line of credit had an interest rate of Adjusted SOFR plus 0.765%, which is based on a tiered rate structure tied to the Company’s credit ratings, adjusted for the facility’s sustainability metric adjustment feature.
The Company’s $75.0 million working capital unsecured line of credit had an interest rate of Adjusted SOFR plus 0.775%, which is based on a tiered rate structure tied to the Company’s long-term unsecured credit ratings, and a scheduled maturity date of July 2026.
For each joint venture the Company holds a non-controlling interest in the venture and, in most cases, may earn customary management fees, development fees, asset property management fees, and a promote interest. The Company has also made, and may continue in the future to make, preferred equity investments in various multifamily stabilized communities or development projects.
For each joint venture the Company holds a non-controlling interest in the venture and, in most cases, may earn customary management fees, development fees, asset management fees and a promote interest.
The Company may also acquire land for future development purposes. As of December 31, 2024, the Company’s development pipeline was comprised of various consolidated predevelopment projects with total incurred costs of $52.7 million.
The Company may also acquire land for future development purposes. As of December 31, 2025, the Company’s development pipeline was comprised of one consolidated development project of 543 apartment homes and various predevelopment projects with total incurred costs of $157.1 million. The estimated remaining project costs are approximately $200.9 million, for total estimated project costs of $358.0 million.
There are certain types of losses which may not be covered or could exceed coverage limits. The insurance programs are subject to deductibles and self-insured retentions in varying amounts. The Company utilizes a wholly owned insurance subsidiary, Pacific Western Insurance LLC (“PWI”), to self-insure certain earthquake and property losses.
INSURANCE The Company purchases general liability and property insurance coverage, including loss of rent, for each of its communities. The Company also purchases limited earthquake, terrorism, environmental and flood insurance. There are certain types of losses which may not be covered or could exceed coverage limits. The insurance programs are subject to deductibles and self-insured retentions in varying amounts.
As of December 31, 2024, PWI had cash and marketable securities of $98.9 million, and is consolidated in the Company’s financial statements. All of the Company’s communities are located in areas that are subject to earthquake activity.
The Company utilizes a wholly owned insurance subsidiary, Pacific Western Insurance LLC (“PWI”), to self-insure certain earthquake and property losses. As of December 31, 2025, PWI had cash and marketable securities of $106.7 million, and is consolidated in the Company’s financial statements. All of the Company’s communities are located in areas that are subject to earthquake activity.
The Company used the net proceeds of this offering to repay debt maturities, including to fund a portion of the repayment of its outstanding 3.875% senior unsecured notes due May 2024 and for other general corporate and working capital purposes.
The Company intends to use the net proceeds of this offering to repay upcoming debt maturities, including to fund a portion of the repayment of the Company’s $450.0 million aggregate principal amount outstanding of 3.375% senior notes due April 2026, and for other general corporate and working capital purposes, which may include the funding of potential acquisition opportunities.
To identify, retain and reward top performers, the Company engages in meaningful internal succession planning and offers a tenure program, excellence awards, and a bonus recognition program to reward associates for good teamwork, good ideas, and good service.
The Company also provides its associates with an annual $3,000 tuition reimbursement to further support outside professional growth opportunities. To identify, retain and reward top performers, the Company engages in meaningful internal succession planning and offers a tenure bonus program, Everyday Excellence and Impact awards, which are recognition programs to reward associates for excellent teamwork, ideas, and service.
The plan supersedes the Company’s previous common stock repurchase plan announced in December 2015. During the year ended December 31, 2024, the Company did not repurchase any shares. As of December 31, 2024, the Company had $302.7 million of purchase authority remaining under the stock repurchase plan.
As of December 31, 2025, the Company had $302.7 million of purchase authority remaining under the stock repurchase plan.
To maximize real-time responses, the Company has also established a working safety subcommittee that meets bi-weekly. The Company has implemented enhanced safety programs, which include a new Workplace Violence Prevention Program enacted companywide in 2024, regular safety inspections, emergency preparedness processes, hazard identification and control protocols, and related associate training.
The Company has implemented enhanced safety programs, which include a Workplace Violence Prevention Program enacted companywide in 2024, regular safety inspections, emergency preparedness processes, hazard identification and control protocols, and related associate training. 6 Table of Contents The Company’s safety policies align with its health and wellness goals and seeks to proactively prevent workplace accidents and protect the health, wellness and safety of the Company’s associates through training and analysis of incident reports.
As of December 31, 2024, there were no outstanding forward sale agreements, and $900.0 million of shares remained available to be sold under the 2024 ATM Program. In September 2022, the Company’s Board of Directors approved a stock repurchase plan to allow the Company to acquire shares of common stock up to an aggregate value of $500.0 million.
In September 2022, the Company announced that its Board of Directors approved a stock repurchase plan, without an expiration date, to allow the Company to acquire shares of common stock up to an aggregate value of $500.0 million. During the year ended December 31, 2025, the Company did not repurchase any shares.
The 2024 ATM Program replaced the prior equity distribution agreement entered into in September 2021 (the “2021 ATM Program”), which was terminated upon the establishment of the 2024 ATM Program. During the year ended December 31, 2024, the Company did not issue any shares of common stock under the 2024 ATM Program or the 2021 ATM Program.
During the year ended December 31, 2025, the Company did not issue any shares of its common stock through the 2024 ATM Program.
These additional notes have substantially identical terms of the 2034 Notes issued in March 2024. Bank Debt As of December 31, 2024, Moody’s Investor Service and Standard and Poor’s (“S&P”) credit agencies rated Essex Property Trust, Inc. and Essex Portfolio, L.P. Baa1/Stable and BBB+/Stable, respectively.
These proceeds initially may be used to fund the repayment of outstanding indebtedness under the Company’s commercial paper program and unsecured credit facilities and/or invested in short-term securities. Bank Debt As of December 31, 2025, Moody’s Investor Service and Standard and Poor’s (“S&P”) credit agencies rated Essex Property Trust, Inc. and Essex Portfolio, L.P.
(5) In October 2024, the Company acquired its joint venture partner’s 49.9% interest in the BEX II, LLC (“BEX II”) portfolio, comprised of four communities for a total contract price of $337.5 million on a gross basis.
(2) Wesco V, LLC, a joint venture in which the Company owns a 50.0% interest, sold one of its apartment home communities for a total contract price of $94.9 million.
Removed
CURRENT BUSINESS ACTIVITIES Acquisitions of Real Estate Interests The table below summarizes acquisition activity for the year ended December 31, 2024 ($ in millions): Property Name Location Apartment Homes Essex Ownership Percentage Contract Price at Pro Rata Share BEXAEW Portfolio CA and WA 1,480 100% $ 252.0 (1) Maxwell Sunnyvale CA 75 100% 46.6 (2) ARLO Mountain View CA 164 100% 101.1 Patina at Midtown CA 269 100% 58.4 (3) Century Towers CA 376 100% 86.8 (4) BEX II Portfolio CA 871 100% 168.4 (5) Beaumont WA 344 100% 136.1 Total acquisitions 3,579 $ 849.4 (1) In March 2024, the Company acquired its joint venture partner's 49.9% interest in the BEXAEW LLC’s (“BEXAEW”) portfolio comprised of four communities for a total purchase price of $505.0 million on a gross basis.
Added
CURRENT BUSINESS ACTIVITIES Acquisitions of Real Estate Interests The table below summarizes acquisition activity for the year ended December 31, 2025 ($ in millions): Property Name Location Date Apartment Homes Essex Ownership Percentage Contract Price at Pro Rata Share The Plaza CA Jan-25 307 100% $ 161.4 One Hundred Grand CA Feb-25 166 N/A 105.3 (1) ROEN Menlo Park CA Feb-25 146 100% 78.8 Revere Campbell CA May-25 168 N/A 118.0 (1) The Parc at Pruneyard CA May-25 252 100% 122.5 ViO CA Sep-25 234 100% 100.0 1250 Lakeside CA Nov-25 250 100% 143.5 Total acquisitions 1,523 $ 829.5 (1) One Hundred Grand and Revere Campbell replaced Highridge, an apartment home community owned by DownREIT entities that are consolidated by the Company, within the DownREIT structures of those entities pursuant to the like-kind exchange rules under Section 1031 of the Internal Revenue Code of 1986, as amended (“Section 1031 Exchange”).
Removed
(2) In April 2024, the Company accepted the third-party sponsor’s common equity interest affiliated with its $14.7 million preferred equity investment. The community was consolidated on the Company’s financial statements at a $46.6 million valuation.
Added
In general, the Company seeks to offset the dilutive impact on long-term earnings and funds from operations from these dispositions through the positive impact of reinvestment of proceeds.
Removed
(3) In July 2024, the Company acquired its joint venture partner's 49.9% common equity interest in Patina at Midtown for a total purchase price of $117.0 million on a gross basis.
Added
The table below summarizes disposition activity for the year ended December 31, 2025 ($ in millions): Property Name Location Date Apartment Homes Sale Price at Pro Rata Share Highridge CA Feb-25 255 $ 127.0 (1) Essex Skyline CA Apr-25 350 239.6 The Grand CA Jul-25 243 97.5 8th & Republican WA Sep-25 211 47.4 (2) Fourth & U CA Sep-25 171 52.3 Total dispositions 1,230 $ 563.8 3 Table of Contents (1) Highridge, an apartment home community owned by DownREIT entities that are consolidated by the Company, was replaced by One Hundred Grand and Revere Campbell within the DownREIT structures of those entities pursuant to a Section 1031 Exchange.
Removed
(4) In September 2024, the Company acquired its joint venture partner's 50% common equity interest in Century Towers for a total purchase price of $173.5 million on a gross basis.
Added
The 2035 Notes were offered to investors at a price of 99.604% of the principal amount. The Company used the net proceeds of this offering to repay the Company’s $500.0 million senior unsecured notes at maturity in April 2025.
Removed
In general, the Company seeks to offset the dilutive impact on long-term earnings and funds from operations from these dispositions through the positive impact of reinvestment of proceeds. 3 Table of Contents The table below summarizes disposition activity for the year ended December 31, 2024 ($ in millions): Property Name Location Apartment Homes Sale Price at Pro Rata Share Hillsdale Garden CA 697 $ 205.7 (1) Total dispositions 697 $ 205.7 (1) In October 2024, the Company sold its 81.5% interest in a consolidated co-investment, Hillsdale Garden, a 697-unit apartment home community, for a contract price of $252.4 million on a gross basis ($205.7 million at pro rata).
Added
In May 2025, the Operating Partnership obtained a new $300.0 million unsecured term loan priced at Secured Overnight Financing Rate (“SOFR”) plus 0.85% which is based on a tiered rate structure tied to the Company’s long-term unsecured credit rating with a one-year delayed draw feature.
Removed
The 2034 Notes were offered to investors at a price of 99.752% of the principal amount. The 2034 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 Essex.
Added
The Company may elect to increase this facility by up to an additional $300.0 million, to an aggregate size of $600.0 million, if the lenders permit. This term loan is scheduled to mature in May 2028, with two one-year extension options, exercisable at the option of the Company.
Removed
In August 2024, the Operating Partnership issued an additional $200.0 million of the 2034 Notes at a price of 102.871% of the principal amount, plus accrued interest from and including March 2024, up to, but excluding, the settlement date of August 21, 2024, with an effective yield of 5.110% per annum.
Added
As of December 31, 2025, the Company had drawn $300.0 million on this term loan facility. The Company has entered into floating-to-fixed interest rate swaps to fix the interest rate for $197.5 million of the new term loan facility to an all-in rate of 4.1%.
Removed
As of December 31, 2024, the Company had two unsecured lines of credit aggregating $1.28 billion.
Added
In October 2022, the Operating Partnership obtained a $300.0 million unsecured term loan priced at Adjusted SOFR plus 0.85% with an original maturity date of October 2024 with three 12-month extension options, exercisable at the Company’s option. In September 2024, the Company exercised its first option, extending the maturity date to October 2025.
Removed
The Company’s $1.2 billion credit facility had an interest rate of Adjusted Secured Overnight Financing Rate (“Adjusted SOFR”) plus 0.765% which is based on a tiered rate structure tied to the Company’s credit ratings, adjusted for the facility’s sustainability metric adjustment feature, and a scheduled maturity date of January 2029 with two six-month extensions, exercisable at the Company’s option.
Added
In October 2025, the Company executed an amendment of its existing $300.0 million unsecured term loan to extend the maturity date from October 2027 to January 2031, inclusive of extension options exercisable at the Company’s option.
Removed
The Company’s employee statistics for 2024 include the following data as of December 31, 2024: the Company’s workforce was comprised of 6 self-identified ethnically diverse groups, making up 71% of our population, 52% of the Company’s managerial employees, and included 29% of its senior executives; there were 204 women in positions of manager or higher, equating to 59% of managerial positions in the Company; the Company’s workforce self-identified as 41% female and 58% male (1% chose not to disclose their gender); and, 55% of the Company’s corporate associates self-identified as female.
Added
The interest rate was reduced by 0.10% to SOFR plus 0.85% and is swapped to an all-in fixed rate of 4.2% and the swap has a termination date of October 2026.
Removed
Workplace Culture The Company believes it has a broad perspective that better serves both the communities it operates in and the associates it employs due to fostering one of the most talented and diverse workforces among its peers in the real estate industry.
Added
In December 2025, the Operating Partnership issued $350.0 million of senior unsecured notes due on February 15, 2036 with a coupon rate of 4.875% per annum (the “2036 Notes”), which are payable on February 15 and August 15 of each year, beginning on August 15, 2025.
Removed
The Company currently offers training courses to its associates via Workday Learning, and its associates spent 13,122 hours learning in 2024. The Company also provides its associates with an annual $3,000 tuition reimbursement to further support outside professional growth opportunities.
Added
The 2036 Notes were offered to investors at a price of 99.093% of the principal amount.
Removed
The Company’s safety policies align with its health and wellness goals and seeks to proactively prevent workplace accidents and protect the health, wellness and safety of the Company’s associates through training and analysis of incident reports.
Added
Baa1/Stable and BBB+/Stable, respectively. 4 Table of Contents As of December 31, 2025, the Company had two unsecured lines of credit aggregating $1.58 billion. The Company’s $1.5 billion credit facility had an interest rate of SOFR plus 0.775%, which is based on a tiered rate structure tied to the Company’s long-term unsecured credit ratings.
Removed
Employee Engagement In order to engage and promote communication with our associates and solicit meaningful feedback on our efforts to create a positive work environment, the Company issues engagement surveys to all associates to measure 10 key drivers of employee engagement including goal setting, organizational fit, well-being, freedom of opinion, meaningful work, management support and recognition, among others.
Added
In July 2025, the Company amended this revolving credit facility increasing the borrowing capacity from $1.2 billion to $1.5 billion and extended its maturity from January 2029 to January 2030 with two six-month extensions, exercisable at the Company’s option.
Removed
Engagement surveys are split into three phases: new hire surveys, Company-wide annual surveys, and exit surveys. 90% of Company employees participated in the surveys in 2024. The Company’s overall engagement score on the surveys was 8 out of 10. Goal setting, Performance, and Alignment were recognized as the top three areas of strength for the organization.
Added
The Company may elect to increase the facility by up to an additional $1.0 billion, to an aggregate size of $2.5 billion, if the lenders permit.
Removed
Additionally, the Company’s “Essex Cares” program provides direct aid to the Company’s residents, associates, and local communities. 6 Table of Contents INSURANCE The Company purchases general liability and property insurance coverage, including loss of rent, for each of its communities. The Company also purchases limited earthquake, terrorism, environmental and flood insurance.
Added
In May 2025, the Company entered into a commercial paper program under which it can issue unsecured short-term notes, which are backstopped by, and reduce the borrowing capacity of the Company’s $1.5 billion unsecured line of credit facility. The Company can issue up to $750.0 million of commercial paper for up to 397 days from the date of issue.
Added
Furthermore, it would permit the Company, at its election, to settle the agreements by issuing common stock in exchange for net proceeds at the then-applicable forward sale price specified by the agreement or, alternatively, to settle the agreements in whole or in part through the delivery or receipt of common stock or cash.
Added
Issuances of shares under these forward sale agreements are classified as equity transactions. Accordingly, no amounts relating to the forward sale agreements are recorded in the consolidated financial statements until settlement occurs.
Added
Prior to any settlements, the only impact to the consolidated financial statements is the inclusion of incremental shares, if any, within the calculation of diluted earnings per share and diluted earnings per unit using the treasury stock method.
Added
The actual forward price per share to be received by the Company upon settlement will be determined on the applicable settlement date based on adjustments made to the initial forward price to reflect the then-current overnight federal funds rate and the amount of dividends paid to holders of the Company’s common stock over the term of the forward sale agreement.
Added
During the year ended December 31, 2025, the Company entered into forward sale agreements with certain financial institutions acting as forward purchasers under the 2024 ATM Program with respect to 52,600 shares of common stock at an initial gross weighted average forward price of $314.06 per share, which are to be settled by September 2026.
Added
As of December 31, 2025, $900.0 million of shares remained available to be sold under the 2024 ATM Program, pending the settlement of outstanding forward sale agreements.
Added
In October 2024, the Company repaid a $72.0 million senior mortgage associated with a $22.7 million preferred equity investment in Artizan, a 241-unit stabilized apartment home community located in Oakland, CA, and subsequently issued a default notice to the third-party sponsor in January 2025, assumed full managerial control and consolidated the property based on a valuation of $95.0 million. 5 Table of Contents In July 2025, the Company formed a new joint venture, Wesco VII, LLC (“Wesco VII”), with the State of Wisconsin Investment Board, for the purpose of investing in multifamily real estate projects.
Added
Each partner has an initial equity commitment of $50.0 million and holds a 50% ownership interest. The investment is recorded to co-investments in the consolidated balance sheets.
Added
In November 2025, the Company repaid an $88.2 million senior mortgage associated with a $79.5 million preferred equity investment in TENTEN Downtown, a 376-unit apartment home community, located in Los Angeles, CA, and concurrently issued a default notice and assumed full managerial control. The community was consolidated on the Company’s financial statements with a valuation of $167.7 million.
Added
The Company has also made, and may continue in the future to make, preferred equity investments in various multifamily stabilized communities or development projects. The Company earns a preferred rate of return on these investments.
Added
The Company enables the mission through its Human Capital Management Strategy that focuses on four key pillars of Talent Acquisition, Technology and Analytics, Culture and Talent Development, and Rewards and Recognition. The Company is headquartered in San Mateo, CA, and has regional corporate offices in Woodland Hills, CA, Irvine, CA and Bellevue, WA.
Added
In 2025, the Company enhanced its focus on change management as an important capability and leaned into the importance of in-person appreciation and recognition events to strengthen engagement and connection. The Company also supports employee-led resource groups, open to all employees, which foster connection and shared learning.
Added
To maximize real-time responses, the Company has also established a working safety subcommittee that meets bi-weekly.
Added
Employee Engagement Throughout 2025, employee sentiment and feedback were gathered through multiple touchpoints across the employee experience. These included new hire feedback, exit insights, event surveys, and our Speak Up channel, an anonymous comment box.
Added
This ongoing, multi-channel approach enabled employees to share candid input in real time and allowed the organization to identify trends, listen to employee voices, and inform meaningful action throughout the year.
Added
OTHER MATTERS Certain Policies of the Company The Company intends to continue to operate in a manner that will not subject it to regulation under the Investment Company Act of 1940.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

97 edited+9 added−13 removed162 unchanged
Biggest changeThe Company utilizes a wholly owned insurance subsidiary, Pacific Western Insurance LLC (“PWI”), to self-insure certain earthquake and property losses for some of the communities in its portfolio. A decline in the value of the securities held by PWI may materially adversely affect PWI’s ability to cover all or any portion of the amount of any insured losses.
Biggest changeA decline in the value of the securities held by PWI may materially adversely affect PWI’s ability to cover all or any portion of the amount of any insured losses. Despite our insurance coverage, the Company may incur material losses due to uninsured risks, deductibles and self-insured retentions, and/or losses in excess of coverage limits.
In general, investing in mortgages involves risk, including that the value of mortgaged property may be less than the amounts owed, causing realized or unrealized losses; the borrower may not pay indebtedness under the mortgage when due and amounts recovered by the Company in connection with related foreclosures may be less than the amount owed; interest rates payable on the mortgages may be lower than the Company’s cost of funds; in the case of junior mortgages, foreclosure of a senior mortgage could eliminate the junior mortgage; delays in the collection of principal and interest if a borrower claims bankruptcy; possible senior lender default or overconcentration of senior lenders in portfolio; and unanticipated early prepayments may limit the Company’s expected return on its investment.
In general, investing in mortgages involves risk, including that the value of mortgaged property may be less than the amounts owed, causing realized or unrealized losses; the borrower may not pay indebtedness under the mortgage when due and amounts recovered by the Company in connection with related foreclosures may be less than the amount owed; interest rates payable on the mortgages may be lower than the Company’s cost of funds; in the case of junior mortgages, foreclosure of a senior mortgage could eliminate the junior mortgage; delays in the collection of principal and interest if a borrower claims bankruptcy; possible senior lender default or overconcentration of senior lenders in the portfolio; and unanticipated early prepayments may limit the Company’s expected return on its investment.
Also, from time to time, the Company invests in properties (i) which may be subject to certain shared facilities agreements with homeowners’ associations and other entities and/or (ii) subject to ground leases where a subtenant may have certain similar rights to that of a party under such a shared facilities agreements or where a master landlord may have certain rights to control the use, operation and/or repair of the property.
Also, from time to time, the Company invests in properties (i) which may be subject to certain shared facilities agreements with homeowners’ associations and other similar entities and/or (ii) subject to ground leases where a subtenant may have certain similar rights to that of a party under such a shared facilities agreements or where a master landlord may have certain rights to control the use, operation and/or repair of the property.
Potential other consequences include potential exposure to litigation, including government enforcement actions, private litigation (including class actions), fines or criminal penalties, negative reputational impacts that cause us to lose existing or future customers, and/or significant incident response, system restoration or remediation and future compliance costs, and potential exposure to a risk of loss including loss related to the fact that agreements with such vendors, or such vendors’ financial condition, may not allow the Company to recover all costs related to a cybersecurity incident for which they alone or they and the Company should be jointly responsible for, which could result in a material adverse effect on the Company’s business, financial condition and results of operations.
Potential other consequences include exposure to litigation, including government enforcement actions, private litigation (including class actions), fines or criminal penalties, negative reputational impacts that cause us to lose existing or future customers, and/or significant incident response, system restoration or remediation and future compliance costs, and potential exposure to a risk of loss including loss related to the fact that agreements with such vendors, or such vendors’ financial condition, may not allow the Company to recover all costs related to a cybersecurity incident for which they alone or they and the Company should be jointly responsible for, which could result in a material adverse effect on the Company’s business, financial condition and results of operations.
The market is currently experiencing a consolidation of and increased scrutiny on these software vendors and algorithmic platforms, particularly in the multifamily space, which may negatively impact the Company’s choice of vendor and pricing options due to lack of optionality or litigation challenges of the vendor or the vendor’s underlying algorithmic platform.
The market is currently experiencing a consolidation of and increased scrutiny on these software vendors, particularly in the multifamily space and algorithmic platforms, which may negatively impact the Company’s choice of vendor and pricing options due to lack of optionality or litigation challenges of the vendor or the vendor’s underlying algorithmic platform.
The Company’s ownership of co-investments, including joint ventures and joint ownership of communities, its ownership of properties with shared facilities with a homeowners’ association or other entity, its ownership of properties subject to a ground lease and its preferred equity investments and its other partial interests in entities that own communities, could limit the Company’s ability to control such communities and may restrict our ability to finance, refinance, sell or otherwise transfer our interests in these properties and expose us to loss of the properties if such agreements are breached by us or terminated.
The Company’s ownership of co-investments, including joint ventures and joint ownership of communities, its ownership of properties with shared facilities with a homeowners’ association or other similar entity, its ownership of properties subject to a ground lease and its preferred equity investments and its other partial interests in entities that own communities, could limit the Company’s ability to control such communities and may restrict our ability to finance, refinance, sell or otherwise transfer our interests in these properties and expose us to loss of the properties if such agreements are breached by us or terminated.
Should a joint venture partner become bankrupt, the Company could become liable for such partner’s share of joint venture liabilities. From time to time, the Company, through the Operating Partnership, makes certain co-investments in the form of preferred equity investments in third-party entities that have been formed for the purpose of acquiring, developing, financing, or managing real property.
Should a joint venture partner become bankrupt, the Company could become liable for such partner’s share of joint venture liabilities. From time to time, the Company, through the Operating Partnership, makes certain co-investments in the form of preferred equity or mezzanine investments in third-party entities that have been formed for the purpose of acquiring, developing, financing, or managing real property.
Income and growth from the communities may be further materially adversely affected by, among other things, the following factors, in addition to the other risk factors listed in this Item 1A: • changes in the general or local economic climate that could affect demand for housing, including an increase in the use of new technologies and artificial intelligence to replace workers, and other events negatively impacting local employment rates, tenant dispersion, wages and the local economy; • changes in demand for rental housing due to a variety of factors, including changing demographics or policies governing legal immigration, which could lead to a relative decrease in the renting population; • changes in supply and cost of housing; • changes in economic conditions, such as high or sustained inflationary periods in which our operating and financing costs may increase at a rate greater than our ability to increase rents, thereby compressing our operating margins which may have a material adverse effect on our business, or deflationary periods where rents may decline more quickly relative to operating and financing costs; and • the appeal and desirability of our communities to tenants relative to other housing alternatives, including the size and amenity offerings, safety and location convenience, and our technology offerings.
Income and growth from the communities may be further materially adversely affected by, among other things, the following factors, in addition to the other risk factors listed in this Item 1A: • changes in the general or local economic climate that could affect demand for housing, including changing demographics or policies governing legal immigration, which could lead to a relative decrease in the renting population, an increase in the use of new technologies and artificial intelligence to replace workers, and other events negatively impacting local employment rates, tenant dispersion, wages and the local economy; • changes in supply and cost of housing; • changes in economic conditions, such as high or sustained inflationary periods in which our operating and financing costs may increase at a rate greater than our ability to increase rents, thereby compressing our operating margins which may have a material adverse effect on our business, or deflationary periods where rents may decline more quickly relative to operating and financing costs; and • the appeal and desirability of our communities to tenants relative to other housing alternatives, including cost, size and amenity offerings, safety and location convenience, and our technology offerings.
Various initiatives to repeal or amend Prop 13, to eliminate its application to commercial and residential property, to increase the permitted annual real estate tax increases, and/or to introduce split tax roll legislation could increase the assessed value and/or tax rates applicable to commercial property in California.
Various initiatives to repeal or amend Prop 13, to eliminate its application to commercial and residential property, to increase the permitted annual real estate tax increases, and/or to introduce split tax roll legislation could increase the assessed value and/or tax rates applicable to or communities in California.
The Company may not be able to lease its commercial space consistent with its projections or at market rates and the longer-term leases for existing space could result in below market rents over time.
Furthermore, the Company may not be able to lease its commercial space consistent with its projections or at market rates and the longer-term leases for existing space could result in below market rents over time.
Failure of one or more of the Company’s subsidiaries to qualify as a REIT could materially adversely affect the Company’s ability to qualify as a REIT. The Company owns interests in multiple subsidiary REITs that have elected to be taxed as REITs under the Code.
Failure of one or more of the Company’s subsidiaries to qualify as a REIT could materially adversely affect the Company’s ability to qualify as a REIT. The Company owns interests in multiple subsidiaries that have elected to be taxed as REITs under the Code.
The Company would also be disqualified from treatment as a REIT for the four taxable years following the year in which the Company failed to qualify, unless it is entitled to relief under statutory provisions.
The Company would also be disqualified from electing treatment as a REIT for the four taxable years following the year in which the Company failed to qualify, unless it is entitled to relief under statutory provisions.
The delayed delivery or any prolonged interruption of these services may cause tenants to terminate their leases or may result in a reduction of rents and/or increase in our costs or other issues.
Any delayed delivery or prolonged interruption of these services may cause tenants to terminate their leases or may result in a reduction of rents and/or increase in our costs or other issues.
Changes in the Company’s financing policy may lead to higher levels of indebtedness. The Company manages its debt to be in compliance with debt covenants under its unsecured bank facilities and senior unsecured bonds.
Changes in the Company’s financing policy may lead to higher levels of indebtedness. The Company manages its debt in compliance with debt covenants under its unsecured bank facilities and senior unsecured bonds.
In the future, the Company may expend additional resources to continue to enhance the Company’s cybersecurity measures to investigate and remediate any cybersecurity vulnerabilities and/or to further ensure compliance with privacy and cybersecurity laws.
Finally, in the future, the Company may expend additional resources to continue to enhance the Company’s cybersecurity measures to investigate and remediate any cybersecurity vulnerabilities and/or to further ensure compliance with privacy and cybersecurity laws.
Although we have taken steps to abide by applicable privacy and cybersecurity laws, and strive to protect the security of our IT Systems and Confidential Information, the compliance and security measures put in place by the Company and its vendors cannot guarantee perfect compliance or provide absolute security, and the Company and its vendors’ IT Systems may be vulnerable to numerous and evolving cybersecurity threats and risks that threaten the confidentiality, integrity and availability of our IT Systems and Confidential Information, including through social engineering/phishing, malware (including ransomware), distributed denial-of-service attempts, data theft, account takeovers, social engineering/phishing, technological 15 Table of Contents error, employee error, malfeasance by insiders, misconfigurations, “bugs”, or other vulnerabilities in Company, or vendor, IT Systems.
Although we have taken steps to abide by applicable privacy and cybersecurity laws, and strive to protect the security of our IT Systems and Confidential Information, the compliance and security measures put in place by the Company and its vendors cannot guarantee perfect compliance or provide absolute security, and the Company and its vendors’ IT Systems may be vulnerable to numerous and evolving cybersecurity threats and risks that threaten the confidentiality, integrity and availability of our IT Systems and Confidential Information, including through social engineering/phishing, malware (including ransomware), distributed denial-of-service attempts, data theft, account takeovers, social engineering/phishing, technological error, employee error, malfeasance by insiders, misconfigurations, “bugs”, or other vulnerabilities in Company, or vendor, IT Systems.
Any incident could compromise the Company’s or our vendors’ IT Systems (or the IT Systems of third parties that facilitate the Company’s or such vendors’ business activities), and the Confidential Information stored by or on behalf of the Company or such vendors could be accessed, misused, publicly disclosed, corrupted, lost, or stolen, resulting in fraud, including wire fraud related to Company assets or tenant payments, or other harm.
Any incident could compromise the Company’s or our vendors’ IT Systems (or the IT Systems of third parties that facilitate the Company’s or such vendors’ business activities), and the Confidential Information stored by or on behalf of the Company or such vendors could be accessed, misused, publicly disclosed, corrupted, lost, or stolen, resulting in fraud, including wire fraud related to Company assets or tenant payments, access to company funds, or other harm.
If there are changes in the fair value of our land holdings which we determine is less that the carrying basis of our land holdings reflected in our financial statements plus estimated costs to sell, we may be required to take impairment charges which could have a material adverse effect on our financial condition and results of operations.
If there are changes in the fair value of our land holdings which we determine is less than the carrying basis of our land holdings reflected in our financial statements plus estimated costs to sell, we may be required to take impairment charges which could have a material adverse effect on our financial condition and results of operations.
We rely on, or may rely on in the future, certain key software vendors to support business practices critical to our operations, including the collection and understanding of rent and ancillary income, including artificial intelligence platforms, communication with our tenants, interaction and evaluation and/or qualification of our prospective tenants, and to provide us with data.
We rely on, or may rely on in the future, certain key software vendors, including artificial intelligence platforms, to support business practices critical to our operations, including the collection and understanding of rent, leads and leasing, and ancillary income, communication with our tenants, interaction and evaluation and/or qualification of our prospective tenants, and to provide us with data.
A default, including a default under mortgage indebtedness, lines of credit, bank term loan, the indenture for the Company’s outstanding senior notes, or the Company’s interest rate hedging arrangements that is not waived by the applicable required lenders, holders of outstanding notes or counterparties could trigger cross-default or cross-acceleration provisions under one or more agreements governing the Company’s indebtedness, which could cause an immediate default or allow the lenders to declare all funds borrowed thereunder to be due and payable.
A default, including a default under mortgage indebtedness, lines of credit, commercial paper program, bank term loan, the indenture for the Company’s outstanding senior notes, or the Company’s interest rate hedging arrangements that is not waived by the applicable required lenders, holders of outstanding notes or counterparties could trigger cross-default or cross-acceleration provisions under one or more agreements governing the Company’s indebtedness, which could cause an immediate default or allow the lenders to declare all funds borrowed thereunder to be due and payable.
In the event that Fannie Mae and Freddie Mac discontinue providing liquidity to our sector, have their mandates changed or reduced or be disbanded or reorganized by the government or if there is reduced government support for multifamily housing more generally, it may adversely affect interest rates, capital availability, development of multifamily communities and the value of multifamily residential real estate and, as a result, may adversely affect the Company and its growth and operations.
In the event that Fannie Mae and Freddie Mac discontinue providing liquidity to our sector, have their mandates changed or reduced or be disbanded or reorganized by the government or if there is reduced government support for multifamily housing more generally, it may adversely affect interest rates, capital availability, development of 18 Table of Contents multifamily communities and the value of multifamily residential real estate and, as a result, may adversely affect the Company and its growth and operations.
Moreover, if there is a compliance failure, or if a cybersecurity incident affects the Company’s or vendors’ systems, whether through a breach of the Company’s IT Systems or a breach of the IT Systems of third parties, or results in the unauthorized release of Confidential Information, the Company’s reputation and brand could be materially damaged, which could increase our costs in attracting and retaining tenants, and other serious consequences may result.
Moreover, if there is a compliance failure, or if a cybersecurity 15 Table of Contents incident affects the Company’s or vendors’ systems, whether through a breach of the Company’s IT Systems or a breach of the IT Systems of third parties, or results in the unauthorized release of Confidential Information, the Company’s reputation and brand could be materially damaged, which could increase our costs in attracting and retaining tenants, and other serious consequences may result.
The Company pursues development and redevelopment projects, including densification projects, and those activities generally entail certain risks, including: • funds may be expended and management’s time devoted to projects that may not be completed on time or at all; • construction costs may exceed original estimates possibly making some projects economically unfeasible; • projects may be delayed or abandoned due to, without limitation, weather conditions, labor or material shortages, municipal office closures and staff shortages, government recommended or mandated work stoppages, protestors obstructing access or environmental remediation; • occupancy rates and rents at a completed project may be less than anticipated; • expenses may be higher than anticipated, including, without limitation, due to inflationary pressures (including potentially exacerbated by the imposition of tariffs), supply chain issues, costs of litigation over construction contracts, environmental remediation or increased costs for labor (including potentially related to any shrinkage in the labor force or labor shortages related to changing immigration policies), materials and leasing; • we are reliant on third party contractors’ and vendors’ ability to deliver services and products as planned, and if the timeframe, quality or scope of such services and products are different than we expected, our projects may be subject to increased costs and our future income may be lower than expected; • we may be unable to obtain, or experience a delay in obtaining, necessary governmental approvals or third party permits and authorizations, which could result in increased costs or delay or abandonment of opportunities; • we may be unable to obtain financing with favorable terms, or at all, for the proposed development or redevelopment of a community, which may cause us to delay or abandon an opportunity; and • we may incur liabilities to third parties during the development process.
The Company pursues development and redevelopment projects, including densification projects, and those activities generally entail certain risks, including: • funds may be expended and management’s time devoted to projects that may not be completed on time or at all; • construction costs may exceed original estimates possibly making some projects economically unfeasible; • projects may be delayed or abandoned due to, without limitation, weather conditions, labor or material shortages, municipal office closures and staff shortages, government recommended or mandated work stoppages, protestors obstructing access or environmental remediation; • occupancy rates and rents at a completed project may be less than anticipated; • expenses may be higher than anticipated due to, without limitation, inflationary pressures (including potentially exacerbated by the imposition of tariffs), supply chain issues, litigation over construction, environmental remediation or increased costs for labor (including potentially related to any shrinkage in the labor force or labor shortages related to changing immigration policies, concerns regarding deportation or otherwise), materials and leasing; • we are reliant on third party contractors’ and vendors’ ability to deliver services and products as planned, and if the timeframe, quality or scope of such services and products are different than we expected, our projects may be subject to increased costs or delays, and our future income may be lower than expected; • we may be unable to obtain, or experience a delay in obtaining, necessary governmental approvals or third party permits and authorizations, which could result in increased costs or delay or abandonment of opportunities, and/or we may experience challenges with municipalities in completing or approving projects; • we may be unable to obtain financing with favorable terms, or at all, for the proposed development or redevelopment of a community, which may cause us to delay or abandon an opportunity; and • we may incur liabilities to third parties during the development process.
Any adverse developments in the economy or real estate markets in California or Washington, or any decrease in demand for the Company’s communities resulting from the California or Washington regulatory or business environments, could have an adverse effect on the Company’s business and results of operations.
Any adverse developments in the economic or real estate markets in California or Washington, or any decrease in demand for the Company’s communities resulting from the California or Washington regulatory or business environments, could have an adverse effect on the Company’s business and results of operations.
In order to finance the 19 Table of Contents Company’s acquisition and development activities, the Company could issue and sell common stock, preferred stock and convertible debt securities, including pursuant to its equity distribution program, issue partnership units in the Operating Partnership, or enter into joint ventures which may dilute stockholder ownership in the Company and could materially adversely affect the market price of the common stock.
In order to finance the Company’s acquisition and development activities, the Company could issue and sell common stock, preferred stock and convertible debt securities, including pursuant to its equity distribution program, issue partnership units in the Operating Partnership, or enter into joint ventures which may dilute stockholder ownership in the Company and could materially adversely affect the market price of the common stock.
We could experience increased costs related to further developing our communities to mitigate the effects of climate change or repairing damage related to the effects of climate change that may or may not be fully covered by insurance.
We could experience increased costs related to further developing our communities to mitigate or repair damage related to the effects of climate change that may or may not be fully covered by insurance.
There is a risk that we may not be able to refinance existing indebtedness or that a refinancing will not be done on as favorable terms, which in either case could have a material adverse effect on our financial condition, results of operations and cash flows.
There is a risk that we may not be able to refinance existing 17 Table of Contents indebtedness or that a refinancing will not be done on as favorable terms, which in either case could have a material adverse effect on our financial condition, results of operations and cash flows.
Such laws and regulations limit our ability to charge market rents, increase rents, evict tenants or recover increases in our 9 Table of Contents operating expenses and could reduce the value of our communities or make it more difficult for us to dispose of properties in certain circumstances.
Such laws and regulations limit our ability to charge market rents, increase rents, evict tenants, limit our ability to 9 Table of Contents collect rent, or recover increases in our operating expenses and could reduce the value of our communities or make it more difficult for us to dispose of communities in certain circumstances.
Acquisitions of communities involve various risks and uncertainties and may fail to meet expectations. The Company’s acquisition of apartment communities may fail to meet the Company’s expectations due to factors including inaccurate estimates of future income, expenses, and the costs of improvements or redevelopment, which may be exacerbated by the lack of reliable market data due to inconsistent deal flow.
Acquisitions of communities involve various risks and uncertainties and may fail to meet expectations. The Company’s acquisition of apartment communities may fail to meet the Company’s expectations due to factors including inaccurate estimates of future income, expenses, and the costs of improvements or redevelopment, which may be exacerbated by the lack of reliable market data.
Some of these claims may result in defense costs, settlements, fines or judgments against us, some of which are not, or cannot be, covered by insurance, the payment of which could have an adverse impact on our financial position and results of operations.
Some of these claims, which may be funded by litigation financing, may result in defense costs, settlements, fines or judgments against us, some of which are not, or cannot be, covered by insurance, the payment of which could have an adverse impact on our financial position and results of operations.
Dividends payable by REITs may be taxed at higher rates than dividends of non-REIT corporations, which could reduce the net cash received by stockholders and may be detrimental to the Company’s ability to raise additional funds through any future sale of its stock.
Dividends payable by REITs may be taxed at higher rates than dividends of non-REIT corporations, which could reduce the net cash received by stockholders and may be detrimental to the Company’s ability to raise additional funds through any 21 Table of Contents future sale of its stock.
If the Company does not reserve the required number of apartment homes for tenants satisfying these income requirements, the tax-exempt status of the bonds may be terminated, the obligations under the bond documents may be 17 Table of Contents accelerated and the Company may be subject to additional contractual liability.
If the Company does not reserve the required number of apartment homes for tenants satisfying these income requirements, the tax-exempt status of the bonds may be terminated, the obligations under the bond documents may be accelerated and the Company may be subject to additional contractual liability.
Our current balance sheet, the debt capacity available on the unsecured line of credit with a diversified bank group, access to the public and private placement debt markets and secured debt financing providers provide some insulation from volatile capital markets.
Our current balance sheet, the debt capacity available on the commercial paper program and unsecured line of credit with a diversified bank group, access to the public and private placement debt markets and secured debt financing providers provide some insulation from volatile capital markets.
The Company has adopted policies to address and resolve reports of mold when it is detected, and to minimize any impact mold might have on tenants of the affected property, however, the Company may not identify and respond to all mold occurrences.
The Company has adopted policies to address and resolve reports of mold when it is detected, and to minimize any impact mold might have on tenants of the affected property, however, the Company may not identify and respond to all mold occurrences and may result in litigation.
These laws and regulations may include zoning laws, building codes, rent control or stabilization laws, emergency orders, laws benefiting disabled persons, federal, state and local tax laws, landlord tenant laws, environmental laws, employment laws, immigration laws and other laws regulating housing, revenue management software and practices, or laws that are generally applicable to the Company’s business and operations.
These laws and regulations include zoning laws, building codes, rent control or stabilization laws, fee transparency requirements, emergency orders, laws benefiting disabled persons, federal, state and local tax laws, landlord tenant laws, environmental laws, employment laws, immigration laws and other laws regulating housing, revenue management software and practices, or laws that are generally applicable to the Company’s business and operations.
Additionally, we have adjusted our operating model to reduce the number of staff on-site at individual properties and instituted a hub model where specialized staff can service multiple properties from a central location and rely on certain technologies, such as virtual apartment tours, to further reduce the need for on-site staffing.
Additionally, we have adjusted our operating model to reduce the number of staff on-site at individual properties and instituted a hub model where specialized staff can service multiple properties from a central location and rely on certain technologies, such as virtual apartment tours and artificially intelligent leasing agents, to further reduce the need for on-site staffing.
We maintain cyber risk insurance which may be insufficient type or amount to cover us against claims related to a cybersecurity incident, and we cannot be certain that such insurance will continue to be available to us on economically reasonable terms, or at all, or that any insurer will not deny coverage as to any future claims.
We maintain cyber risk insurance, but this may be an insufficient type or amount to cover us against claims related to a cybersecurity incident, and we cannot be certain that such insurance will continue to be available to us on economically reasonable terms, or at all, or that any insurer will not deny coverage as to any future claims.
In the event of a recession or other negative economic effects, including slowing job growth in key markets, the Company could incur reductions in rental and occupancy rates, property valuations and increases in costs.
In the event of a recession, continued geopolitical uncertainty or other negative economic effects, including slowing job growth in key markets, the Company could incur reductions in rental and occupancy rates, property valuations and increases in costs.
Rent control, or future or potential changes in applicable laws, or noncompliance with applicable laws, could materially adversely affect the Company’s stock price, business, financial condition and results of operations, and/or expose us to liability.
Rent control, eviction moratoria or potential changes in applicable laws, or noncompliance with applicable laws, could materially adversely affect the Company’s stock price, business, financial condition and results of operations, and/or expose us to liability.
Additional local, state and federal laws and rules with respect to corporate responsibility and sustainability matters may be enacted in the future and the extent and scope of their requirements and impact on our business are unknown.
Additional local, state and federal laws and rules with respect to corporate responsibility and sustainability matters may be enacted and the scope of their requirements and impact on our business are unknown.
If the Company finances new acquisitions under existing lines of credit, there is a risk that, unless the Company obtains substitute financing, the Company may not be able to undertake additional borrowing for further acquisitions or developments or such borrowing may not be available on advantageous terms.
If the Company finances new acquisitions under existing lines of credit or commercial paper, there is a risk that, unless the Company obtains substitute financing or capital sources, the Company may not be able to undertake additional borrowing for further acquisitions or developments or such borrowing may not be available on advantageous terms.
As a result of climate change, we may experience extreme weather, an increase in frequency and severity of natural disasters, changes in precipitation, temperature, wildfire and drought exposure, and impacts of sea-level rise, all of which may result in physical damage, a decrease in demand for our communities located in these areas or affected by these conditions, damage to our properties, disruption of services at our properties or increased costs associated with water or energy use and maintaining or insuring our communities.
As a result of climate change, we may experience extreme weather, an increase in frequency and severity of natural disasters, changes in precipitation, temperature, wildfire and drought exposure, and impacts of rising sea-levels, all of which may result in damage to our communities, a decrease in demand for our communities located in these areas or affected by these conditions, disruption of services at our communities or increased costs associated with water or energy use and maintaining or insuring our communities.
Real estate investments are illiquid and, in our markets, can at times be difficult to sell at prices we find acceptable, which may limit our ability to promptly reduce our portfolio in response to 12 Table of Contents changes in economic or other conditions and otherwise may materially adversely affect our financial condition and results of operations.
Real estate investments are illiquid and, in our markets, can at times be difficult to sell at prices we find acceptable, which may limit our ability to promptly reduce our portfolio in response to changes in economic or other conditions and otherwise may materially adversely affect our financial condition and results of operations. 12 Table of Contents The Company’s portfolio may have environmental liabilities.
The Company may make acquisitions or commence development activity outside of its existing market areas if appropriate opportunities arise, which may expose the Company to new risks, including, but not limited to an inability to evaluate accurately local apartment market conditions and local economies; an inability to identify appropriate acquisition opportunities or to obtain land for development; an inability to hire and retain key personnel; and a lack of familiarity with local governmental and permitting procedures.
The Company may make acquisitions, pursue new business models, explore new capital sources or commence development activity outside of its existing market areas if appropriate opportunities arise, which may expose the Company to new risks, including, but not limited to an inability to evaluate accurately local apartment market conditions and local economies; an inability to identify appropriate acquisition opportunities or to obtain land for development; an inability to hire and retain key personnel; and a lack of familiarity with local governmental and permitting procedures.
We may pursue acquisitions of other REITs and real estate companies, which may not yield anticipated results and could materially adversely affect our results of operations. We may make acquisitions of and/or investments in other REITs and real estate companies or enter into strategic alliances or joint ventures, which involves risks and uncertainties and may not be successful.
We may pursue acquisitions of other REITs and real estate companies, which may not yield anticipated results and could materially adversely affect our results of operations. We may acquire and/or invest in other REITs and real estate companies or enter into strategic alliances or joint ventures, which involves risks and uncertainties and may not be successful.
In addition, certain litigation or the resolution of certain litigation may affect the availability or cost of some of our insurance coverage and expose us to increased risks that would be 16 Table of Contents uninsured.
In addition, certain litigation or the resolution of certain litigation may affect the availability or cost of some of our insurance coverage and expose us to increased risks that would be uninsured.
Further, if we fail to comply with new laws, regulations, expectations or reporting requirements related to sustainability, or if we are perceived as failing, our reputation and business could be materially adversely affected.
If we fail to comply with new laws, regulations or expectations related to sustainability, or if we are perceived as failing, our reputation and business could be materially adversely affected.
If the Company fails to qualify as a REIT in any taxable year, the Company would be subject to U.S. federal corporate income tax on the Company’s taxable income, and the Company would not be allowed to deduct dividends 20 Table of Contents paid to its stockholders in computing its taxable income.
If the Company fails to qualify as a REIT in any taxable year, the Company would be subject to U.S. federal corporate income tax on the Company’s taxable income, and the Company would not be allowed to deduct dividends paid to its stockholders in computing its taxable income.
When leases for our existing commercial space expire, the space may not be relet on a timely basis, or at all, or the terms of reletting, including the cost of allowances and concessions to tenants, may be less favorable than the current lease terms. The Company’s portfolio may have environmental liabilities.
When leases for our existing commercial space expire, the space may not be relet on a timely basis, or at all, or the terms of reletting, including the cost of allowances and concessions to tenants, may be less favorable than the current lease terms.
Although the Company may carry insurance for potential losses associated with its communities, employees, tenants, and compliance with applicable laws, it may still incur material losses due to uninsured risks, deductibles, copayments or losses in 13 Table of Contents excess of applicable insurance coverage.
Although the Company may carry insurance for potential losses associated with its communities, employees, tenants, and compliance with applicable laws, it may still incur material losses due to class actions, uninsured risks, deductibles, copayments or losses in excess of applicable insurance coverage.
Privacy and cybersecurity laws continue to evolve, with several states passing new data privacy laws that govern the processing of information about state residents, and laws may be inconsistent from one jurisdiction to another.
Privacy and cybersecurity laws continue to evolve, with a number of states passing data privacy laws that govern the processing of information about state residents, and laws may be inconsistent from one jurisdiction to another.
The Company plans to manage its operations to maintain its investment grade credit rating with a capital structure consistent with its current profile but there can be no assurance that it will be able to maintain its current credit ratings.
The Company intends to maintain its investment grade credit rating with a capital structure consistent with its current profile but there can be no assurance that it will be able to maintain its current credit ratings.
In some cases, we may spend more than budgeted amounts to make necessary improvements or maintenance, which could materially adversely affect the Company’s financial condition and results of operations. Competition in the apartment community market and other housing alternatives may materially adversely affect operations and the rental demand for the Company’s communities.
In some cases, especially with respect to newly acquired properties, we may spend more than budgeted amounts to make necessary improvements or maintenance, which could materially adversely affect the Company’s financial condition and results of operations. Competition in the apartment community market and other housing alternatives may materially adversely affect operations and the rental demand for the Company’s communities.
There may be resistance to such change from our residents, and if we experience difficulty in retaining residents, this could materially adversely affect the Company’s results of operations.
There has been resistance to such change from our residents, and if we experience difficulty in retaining residents, this could materially adversely affect the Company’s results of operations.
Those provisions include, among others, directors may be removed by stockholders, without cause, only upon the affirmative vote of at least two-thirds of the votes entitled to be cast generally in the election of the directors, and with cause, only upon the affirmative vote of a majority of the votes entitled to be cast generally in the election of the directors; the Board can fix the number of directors and fill vacant directorships upon the vote of a majority of the directors and the Board can classify the board such that the entire board is not up for re-election annually; stockholders must give advance notice to nominate directors or propose business for consideration at a stockholders’ meeting; and for stockholders to call a special meeting, the meeting must be requested by not less than a majority of all the votes entitled to be cast at the meeting.
Those provisions include, among others, directors may be removed by stockholders, without cause, only upon the affirmative vote of at least two-thirds of the votes entitled to be cast generally in the election of the directors, and with cause, only upon the affirmative vote of a majority of the votes entitled to be cast generally in the election of the directors; the Board can fix the number of directors and fill vacant directorships upon the vote of a majority of the directors and the Board can classify the board such that the entire board is not up for re-election annually; stockholders must give advance notice to nominate directors or propose business for consideration at a stockholders’ meeting; and for stockholders to call a special meeting, the meeting must be requested by not less than a majority of all the votes entitled to be cast at the meeting. 20 Table of Contents Stockholders have limited control over changes in our policies and operations.
The Board may modify our dividend policy from time to time. Essex may choose to pay dividends in its own stock, which could materially adversely affect its stockholders.
The Board may modify our dividend policy from time to time. 19 Table of Contents Essex may choose to pay dividends in its own stock, which could materially adversely affect its stockholders.
Dividends paid by REITs to U.S. stockholders that are individuals, trusts or estates are generally not eligible for the reduced tax rate applicable to qualified dividends received from non-REIT corporations. U.S. stockholders that are individuals, trusts and estates generally may deduct 20% of ordinary dividends from a REIT for taxable years beginning before January 1, 2026.
Dividends paid by REITs to U.S. stockholders that are individuals, trusts or estates are generally not eligible for the reduced tax rate applicable to qualified dividends received from non-REIT corporations. U.S. stockholders that are individuals, trusts and estates generally may deduct 20% of ordinary dividends from a REIT.
In addition, both advocates and opponents to such matters are increasingly resorting to a range of activism forms, including media campaigns, shareholder activism, and litigation, to advance their perspectives, and certain jurisdictions are adopting or considering adopting laws seeking to limit the use of corporate responsibility and sustainability initiatives in certain contexts.
In addition, both advocates and opponents to such matters may resort to activism, including media campaigns, shareholder activism, and litigation, to advance their perspectives, and certain jurisdictions are adopting or considering adopting laws seeking to limit the use of corporate responsibility and sustainability initiatives in certain contexts.
Additionally, the preferred return negotiated on these co-investments may be lower than the Company’s cost of funds. The Company may also incur losses if any guarantees or indemnifications were made by the Company. The Company also owns properties indirectly under “DownREIT” structures.
Additionally, the preferred return negotiated on these co-investments may be lower than the Company’s cost of funds. The Company may also incur losses if any guarantees or indemnifications were made by the Company. The Company also owns properties indirectly through partnerships commonly referred to as “DownREIT” structures.
Marcus owns interests in various other real estate-related businesses and investments. He 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. While conflict of interest protocols and agreements are in place, Mr.
He 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. While conflict of interest protocols and agreements are in place, Mr.
The Company manages and evaluates its financial loss exposure to seismic events by using actuarial loss models and property vulnerability analyses based on structural evaluations by seismic consultants, and by making upgrades to certain properties to better resist seismic events and/or by purchasing seismic insurance in some cases.
Our communities are located in areas that are subject to earthquake activity. The Company manages and evaluates its financial loss exposure to seismic events by using actuarial loss models and property vulnerability analyses based on structural evaluations by seismic consultants, and by making upgrades to certain properties to better resist seismic events and/or by purchasing seismic insurance in some cases.
Stockholders have limited control over changes in our policies and operations. The Board determines our major policies, including our policies regarding investments, financing, growth, debt capitalization, REIT qualification and distributions. The Board may amend or revise these and other policies without a vote of the stockholders.
The Board determines our major policies, including our policies regarding investments, financing, growth, debt capitalization, REIT qualification and distributions. The Board may amend or revise these and other policies without a vote of the stockholders.
Due to consolidation pressure and M&A activity in the REIT sector, we may receive unsolicited acquisition proposals or become the target of activist investors seeking to force a sale or merger.
We could face adverse consequences as a result of M&A activity in the REIT sector and actions of activist investors. Due to consolidation pressure and M&A activity in the REIT sector, we may receive unsolicited acquisition proposals or become the target of activist investors seeking to force a sale or merger.
If a U.S. stockholder sells the stock it receives as a dividend in order to pay applicable taxes, the sales proceeds may be less than the amount included in income with respect to the dividend, depending on the market price of our stock at the time of the sale.
If Essex pays a stock dividend that is taxable for U.S. federal income tax purposes, and a U.S. stockholder sells the stock it receives as a dividend in order to pay applicable taxes, the sales proceeds may be less than the amount included in income with respect to the dividend, depending on the market price of our stock at the time of the sale.
Competitive housing in a particular area and fluctuations in cost of owner-occupied single- and multifamily homes caused by a decrease in housing prices, mortgage interest rates and/or government programs to promote home ownership or create additional rental and/or other types of housing, or an increase in desire for more space due to work-from-home needs or increased time spent at home, could materially adversely affect the Company’s ability to retain its tenants, lease apartment homes and increase or maintain rents.
Competitive housing in a particular area and fluctuations in cost of owner-occupied single- and multifamily homes caused by a decrease in housing prices, mortgage interest rates and/or government programs to promote home ownership or create additional rental and/or other types of housing could materially adversely affect the Company’s ability to retain its tenants, lease apartment homes and increase or maintain rents.
If the criteria by which companies are scored changes, the Company may perform differently or worse than it has in the past, or it may become more expensive for the Company to access capital.
Finally, if the criteria by which companies are scored on corporate responsibility may change, and the Company may perform differently or worse than it has in the past, and it may become more expensive for the Company to access capital.
The Company is unable to predict the outcome or estimate the amount of loss, if any, that may result from such matters. The Company is also subject to various other legal and/or regulatory proceedings arising in the normal course of its business operations, including California private attorney general actions (“PAGA Claims”).
The Company is unable to predict the outcome or estimate the amount of loss, if any, that may result from such matters. The Company is also subject to various other legal and/or regulatory proceedings arising in the normal course of its business operations, including certain class actions and PAGA Claims.
The geographic concentration of the Company’s communities and fluctuations in local markets may materially adversely affect the Company’s financial condition and results of operations. The Company’s communities are concentrated in California and the Seattle metropolitan area, which exposes the Company to greater economic concentration risks.
The geographic concentration of the Company’s communities and fluctuations in local markets may adversely affect the Company’s financial condition and results of operations. The Company’s communities are concentrated on the West Coast in the metropolitan areas of California and Washington, which exposes the Company to greater economic concentration risks.
Privacy and cybersecurity risks have generally increased in recent years because of the proliferation of new techniques and tools that circumvent security tools, evade detection and remove forensic evidence, such as artificial intelligence, and the increased sophistication, techniques and activities of threat actors; accordingly, the Company may be unable to anticipate these techniques or implement adequate preventative measures.
Privacy and cybersecurity risks have generally increased in recent years because of the proliferation of new techniques and tools that circumvent security tools, evade detection and remove forensic evidence, such as artificial intelligence, the increased sophistication, techniques and activities of threat actors, and the broader adoption of remote and hybrid work arrangements that introduce additional security vulnerabilities due to off-network access; accordingly, the Company may be unable to anticipate these techniques or implement adequate preventative measures.
The Company may experience various increased costs, including increased property taxes, to own and maintain its properties. Real property taxes on our properties may increase as our properties are reassessed by taxing authorities or as property tax rates change. Our real estate taxes in Washington could increase as a result of property value reassessments or increased property tax rates.
The Company may experience various increased costs, including increased property taxes, to own and maintain its properties. Real property taxes on our properties may increase as our properties are reassessed by taxing authorities or as property tax rates change.
We occasionally dispose of real properties in transactions intended to qualify as “like-kind exchanges” under Section 1031 of the Code.
We may face risks in connection with Section 1031 exchanges. We occasionally dispose of real properties in transactions intended to qualify as “like-kind exchanges” under Section 1031 of the Code.
Existing and future rent control or rent stabilization laws and regulations, along with similar laws and regulations that expand tenants’ rights or impose additional costs on landlords, including any such laws or regulations imposed in response to natural disasters and/or media attention on the housing industry, may reduce rental revenues or increase operating costs and thus such laws and regulations may materially adversely affect our stock price, business, financial condition and results of operations.
Existing and future eviction moratoria, rent control or rent stabilization laws and regulations, fee transparency requirements, along with similar laws and regulations that expand tenants’ rights or impose additional costs on landlords, including any such laws or regulations imposed on the housing industry in response to natural disasters, national and global pandemic or other any other health crisis, or local or national states of emergency, may reduce rental revenues or increase operating costs and thus such laws and regulations may materially adversely affect our stock price, business, financial condition and results of operations.
The Company may incur general uninsured losses or may experience market conditions that impact the procurement of certain insurance policies. The Company purchases general liability and property, including loss of rent, insurance coverage for each of its communities and cyber risk insurance. The Company may also purchase limited earthquake, terrorism, environmental and flood insurance for some of its communities.
The Company may incur general uninsured losses or may experience market conditions that impact the procurement of certain insurance policies. The Company purchases general liability, employment practices liability, and property, including loss of rent, insurance coverage for each of its communities and cyber risk insurance.
The Company has entered into, and may continue in the future to enter into, certain co-investments, including joint 11 Table of Contents ventures or partnerships through which it owns an indirect economic interest in less than 100% of the community or land or other investments owned directly by the joint venture or partnership.
The Company has entered into, and may continue in the future to enter into, certain co-investments, including joint ventures or partnerships through which it owns an indirect economic interest in less than 100% of the community or land or other investments owned directly by the joint venture or partnership. 11 Table of Contents Joint venture partners often have shared control over the development and operation of the joint venture assets, which may prevent the Company from taking action without the partners’ approval.
Further, there are unknown risks with relying on new technologies and operating models, such as whether there is consumer preference for in-person tours or if we are not able to as rapidly respond to resident demands, and we cannot guarantee that this model will be successful, which could materially adversely affect our results of operations. 14 Table of Contents Our business and reputation depend on our ability to continue providing high quality housing and consistent operation of our communities, the failure of which could materially adversely affect our business, financial condition and results of operations.
Further, there are unknown risks with relying on new technologies and operating models, such as whether there is consumer preference for in-person tours or if we are not able to as rapidly respond to resident demands, and we cannot guarantee that this model will be successful, which could materially adversely affect our results of operations.
Any cybersecurity incident or failure in the implementation, compliance with or effectiveness of the Company’s IT Systems or cybersecurity program or those of third party service providers, or a breach of other third party systems that ultimately impacts the operational or IT Systems of the Company could result in a wide range of material adverse effects to our business and results of operations.
Any cybersecurity incident or failure in the implementation, compliance with or effectiveness of the Company’s IT Systems or cybersecurity program or those of third party service providers, or a breach of other third party systems that ultimately impacts the operational or IT Systems of the Company could result in a wide range of material adverse effects to our business and results of operations. 16 Table of Contents Reliance on third party software providers to host systems is critical to our operations and to provide the Company with data, and regulation of those providers and practices may impact operational capabilities.
However, there are types of losses, generally catastrophic in nature, such as losses due to wars, acts of terrorism, earthquakes, wildfires, pollution, environmental matters or extreme weather conditions such as hurricanes and floods that are uninsurable or not economically insurable.
The Company may also purchase limited earthquake, terrorism, environmental and flood insurance for some of its communities. However, there are types of losses, generally catastrophic in nature, such as losses due to wars, acts of terrorism, earthquakes, wildfires, pollution, environmental matters or extreme weather conditions such as hurricanes and floods that are uninsurable or not economically insurable.
The Company’s Chairman is involved in other real estate activities and investments, which may lead to conflicts of interest. The Company’s Chairman, George M. Marcus, is not an employee of the Company, and is involved in other real estate activities and investments, which may lead to conflicts of interest. Mr.
Marcus, is not an employee of the Company, and is involved in other real estate activities and investments, which may lead to conflicts of interest. Mr. Marcus owns interests in various other real estate-related businesses and investments.
Failure to succeed in new markets or with new community operations formats may limit the Company’s growth.
Failure to succeed in new markets or with new community operations formats may limit the Company’s growth, and additionally, the Company’s commercial leases could adversely affect us.
The Company endeavors to comply with privacy laws and regulations applicable to it, including the California Consumer Privacy Act (“CCPA”) which governs the collection, use, disclosure and security of information about California residents.
The Company endeavors to comply with privacy laws and regulations applicable to it, including the California Consumer Privacy Act and Washington State’s “My Health My Data Act”, which govern the collection, use, retention, disclosure and security of personal information about California and Washington residents, respectively.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

5 edited+2 added−1 removed12 unchanged
Biggest changeThe Company provides training to its employees on cybersecurity matters, performs periodic awareness testing to facilitate compliance with the Company’s cybersecurity policies, and maintains a method for its employees and consultants to communicate any suspected cybersecurity incident.
Biggest changeThe Company's risk assessment and management processes also address emerging cybersecurity threats, including those that are AI-enabled. The Company provides training to its employees on cybersecurity matters, conducts periodic tabletop incident response exercises, performs recurring awareness testing to facilitate compliance with the Company’s cybersecurity policies, and maintains a method for its employees and consultants to communicate any suspected cybersecurity incident.
The CTO reports to the Chief Executive Officer (“CEO”) and provides updates to the Company’s senior leadership team on a regular basis, at least quarterly, about risks from cybersecurity threats, the results of penetration tests, vulnerability scans and userbase issues.
The CTO reports to the Chief Executive Officer and provides updates to the Company’s senior leadership team on a regular basis, at least quarterly, about risks from cybersecurity threats, the results of penetration tests, vulnerability scans and userbase issues.
The CTO and other members of the Company’s management team takes steps to stay informed about and monitor efforts to prevent, detect, mitigate and remediate cybersecurity risks and incidents through various means, such as briefings from internal security personnel; threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged; and alerts and reports produced by security tools deployed in our IT environment.
The CTO and other members of the Company’s management team take steps to stay informed about and monitor efforts to prevent, detect, mitigate and remediate cybersecurity risks and incidents through various means, such as briefings from internal security personnel; threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged; and alerts and reports produced by security tools deployed in our IT environment.
The Company’s technology management team and third-party professionals perform penetration tests, vulnerability scans, and patch management to assess and protect the confidentiality, integrity and availability of its critical systems and information.
The Company’s technology management team conducts risk assessments designed to help identify material cybersecurity risks to our critical systems and information. The Company’s technology management team and third-party professionals perform penetration tests, vulnerability scans, and patch management to assess and protect the confidentiality, integrity and availability of its critical systems and information.
Item 1C. Cybersecurity The Company has developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity and availability of its critical systems and information.
Item 1C. Cybersecurity The Company has developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity and availability of its critical systems and information. We design and assess our program based on the National Institute of Standards and Technology Cybersecurity Framework (NIST CSF).
Removed
The Company’s technology management team performs enterprise-level risk assessments designed to help identify 23 Table of Contents material cybersecurity risks to our critical systems, information, products, services, and our broader enterprise IT environment.
Added
Accordingly, we use NIST CSF as a 23 Table of Contents guide to help us identify, assess, and manage cybersecurity risks relevant to our business.
Added
Furthermore, the Company has adopted internal guidelines designed to address employee use of third-party artificial intelligence tools and protect confidential Company information from unauthorized disclosure to such tools.

Item 2. Properties

Properties — owned and leased real estate

12 edited+0 added−1 removed11 unchanged
Biggest changeFurthermore, as of December 31, 2024, the commercial buildings’ physical occupancy rate was 93% consisting of seven tenants, including the Company. 25 Table of Contents Operating Portfolio The table below describes the Company’s operating portfolio as of December 31, 2024 (See Note 8, “Mortgage Notes Payable” to the Company’s consolidated financial statements included in Part IV, Item 15 of this Annual Report on Form 10-K for more information about the Company’s secured mortgage debt and Schedule III thereto for a list of secured mortgage loans related to the Company’s portfolio.): Apartment Year Year Communities (1) Location Type Homes Built Acquired (2) Occupancy (3) Southern California Alpine Village Alpine, CA Garden 301 1971 2002 96% Park Viridian Anaheim, CA Mid-rise 320 2008 2014 96% The Barkley (4)(5) Anaheim, CA Garden 161 1984 2000 96% Bonita Cedars Bonita, CA Garden 120 1983 2002 97% The Village at Toluca Lake Burbank, CA Mid-rise 146 1974 2017 96% Camarillo Oaks Camarillo, CA Garden 564 1985 1996 96% Camino Ruiz Square Camarillo, CA Garden 160 1990 2006 97% Hacienda at Camarillo Oaks Camarillo, CA Garden 73 1984 2023 94% Pinnacle at Otay Ranch I & II Chula Vista, CA Mid-rise 364 2001 2014 96% Mesa Village Clairemont, CA Garden 133 1963 2002 95% Villa Siena Costa Mesa, CA Garden 274 1974 2014 96% Emerald Pointe Diamond Bar, CA Garden 160 1989 2014 97% Regency at Encino Encino, CA Mid-rise 75 1989 2009 95% The Havens Fountain Valley, CA Garden 440 1969 2014 97% Valley Park Fountain Valley, CA Garden 160 1969 2001 96% Capri at Sunny Hills (5) Fullerton, CA Garden 102 1961 2001 93% Haver Hill (6) Fullerton, CA Garden 265 1973 2012 97% Pinnacle at Fullerton Fullerton, CA Mid-rise 192 2004 2014 97% Wilshire Promenade Fullerton, CA Mid-rise 149 1992 1997 96% Montejo Garden Grove, CA Garden 124 1974 2001 97% The Henley I Glendale, CA Mid-rise 83 1974 1999 96% The Henley II Glendale, CA Mid-rise 132 1970 1999 96% Huntington Breakers Huntington Beach, CA Mid-rise 344 1984 1997 97% The Huntington Huntington Beach, CA Garden 276 1975 2012 97% Hillsborough Park La Habra, CA Garden 235 1999 1999 97% Village Green La Habra, CA Garden 272 1971 2014 97% The Palms at Laguna Niguel Laguna Niguel, CA Garden 460 1988 2014 96% Trabuco Villas Lake Forest, CA Mid-rise 132 1985 1997 96% Marbrisa Long Beach, CA Mid-rise 202 1987 2002 95% Pathways at Bixby Village Long Beach, CA Garden 296 1975 1991 97% 5600 Wilshire Los Angeles, CA Mid-rise 284 2008 2014 95% Alessio Los Angeles, CA Mid-rise 624 2001 2014 94% Ashton Sherman Village Los Angeles, CA Mid-rise 264 2014 2016 97% Avant Los Angeles, CA Mid-rise 443 2014 2015 93% The Avery Los Angeles, CA Mid-rise 121 2014 2014 96% Bellerive Los Angeles, CA Mid-rise 63 2011 2011 96% Belmont Station Los Angeles, CA Mid-rise 275 2009 2009 94% Catalina Gardens Los Angeles, CA Mid-rise 128 1987 2014 94% Cochran Apartments Los Angeles, CA Mid-rise 58 1989 1998 96% Emerson Valley Village Los Angeles, CA Mid-rise 144 2012 2016 97% Gas Company Lofts (6) Los Angeles, CA High-rise 251 2004 2013 92% 26 Table of Contents Apartment Year Year Communities (1) Location Type Homes Built Acquired (2) Occupancy (3) Marbella Los Angeles, CA Mid-rise 60 1991 2005 96% Pacific Electric Lofts (7) Los Angeles, CA High-rise 314 2006 2012 93% Park Catalina Los Angeles, CA Mid-rise 90 2002 2012 95% Park Place Los Angeles, CA Mid-rise 60 1988 1997 96% Regency Palm Court Los Angeles, CA Mid-rise 116 1987 2014 93% Santee Court Los Angeles, CA High-rise 165 2004 2010 93% Santee Village Los Angeles, CA High-rise 73 2011 2011 93% Skye at Bunker Hill Los Angeles, CA High-rise 456 1968 1998 96% The Blake LA Los Angeles, CA Mid-rise 196 1979 1997 98% Tiffany Court Los Angeles, CA Mid-rise 101 1987 2014 95% Wallace on Sunset Los Angeles, CA Mid-rise 200 2021 2021 91% Wilshire La Brea Los Angeles, CA Mid-rise 478 2014 2014 96% Windsor Court Los Angeles, CA Mid-rise 95 1987 2014 94% Windsor Court Los Angeles, CA Mid-rise 58 1988 1997 96% Aqua at Marina Del Rey Marina Del Rey, CA Mid-rise 500 2001 2014 97% Marina City Club (8) Marina Del Rey, CA Mid-rise 101 1971 2004 97% Mirabella Marina Del Rey, CA Mid-rise 188 2000 2000 95% Mira Monte Mira Mesa, CA Garden 356 1982 2002 97% Hillcrest Park Newbury Park, CA Garden 608 1973 1998 97% Fairway at Big Canyon (9) Newport Beach, CA Mid-rise 74 1972 1999 97% Muse North Hollywood, CA Mid-rise 152 2011 2011 95% Country Villas Oceanside, CA Garden 180 1976 2002 96% Mission Hills Oceanside, CA Garden 282 1984 2005 96% Renaissance at Uptown Orange Orange, CA Mid-rise 460 2007 2014 97% Arbors at Parc Rose (7) Oxnard, CA Mid-rise 373 2001 2011 96% Mariner’s Place Oxnard, CA Garden 105 1987 2000 95% Monterey Villas Oxnard, CA Garden 122 1974 1997 97% Tierra Vista Oxnard, CA Mid-rise 404 2001 2001 96% The Hallie Pasadena, CA Mid-rise 292 1972 1997 96% The Stuart Pasadena, CA Mid-rise 188 2007 2014 97% Villa Angelina Placentia, CA Garden 256 1970 2001 96% Fountain Park Playa Vista, CA Mid-rise 705 2002 2004 93% Highridge (5) Rancho Palos Verdes, CA Mid-rise 255 1972 1997 96% Cortesia Rancho Santa Margarita, CA Garden 308 1999 2014 96% Pinnacle at Talega San Clemente, CA Mid-rise 362 2002 2014 97% Allure at Scripps Ranch San Diego, CA Mid-rise 194 2002 2014 96% Bernardo Crest San Diego, CA Garden 216 1988 2014 97% Cambridge Park San Diego, CA Mid-rise 320 1998 2014 97% Carmel Creek San Diego, CA Garden 348 2000 2014 97% Carmel Landing San Diego, CA Garden 356 1989 2014 97% Carmel Summit San Diego, CA Mid-rise 246 1989 2014 97% CentrePointe San Diego, CA Garden 224 1974 1997 94% Esplanade San Diego, CA Garden 616 1986 2014 96% Form 15 San Diego, CA Mid-rise 242 2014 2016 96% LIVIA at Scripps Ranch (10)(14) San Diego, CA Mid-rise 264 2024 2024 95% Montanosa San Diego, CA Garden 472 1990 2014 97% 27 Table of Contents Apartment Year Year Communities (1) Location Type Homes Built Acquired (2) Occupancy (3) Summit Park San Diego, CA Garden 300 1972 2002 96% Essex Skyline (11) Santa Ana, CA High-rise 350 2008 2010 94% Fairhaven (5) Santa Ana, CA Garden 164 1970 2001 96% Parkside Court Santa Ana, CA Mid-rise 210 1986 2014 97% Pinnacle at MacArthur Place Santa Ana, CA Mid-rise 253 2002 2014 96% Hope Ranch Santa Barbara, CA Garden 108 1965 2007 97% Bridgeport Coast (12) Santa Clarita, CA Mid-rise 188 2006 2014 96% Meadowood Simi Valley, CA Garden 320 1986 1996 96% Shadow Point Spring Valley, CA Garden 172 1983 2002 95% The Fairways at Westridge (12) Valencia, CA Mid-rise 234 2004 2014 97% The Vistas of West Hills (12) Valencia, CA Mid-rise 220 2009 2014 97% Allegro Valley Village, CA Mid-rise 97 2010 2010 97% Lofts at Pinehurst, The Ventura, CA Garden 118 1971 1997 97% Pinehurst (13) Ventura, CA Garden 28 1973 2004 97% Woodside Village Ventura, CA Garden 145 1987 2004 97% Passage Buena Vista (14) Vista, CA Garden 179 2020 2021 96% Walnut Heights Walnut, CA Garden 163 1964 2003 95% The Dylan West Hollywood, CA Mid-rise 184 2014 2014 93% The Huxley West Hollywood, CA Mid-rise 187 2014 2014 95% Avondale at Warner Center Woodland Hills, CA Mid-rise 446 1970 1999 96% Reveal Woodland Hills, CA Mid-rise 438 2010 2011 95% Vela (16) Woodland Hills, CA Mid-rise 379 2018 2022 95% 26,484 96% Northern California Belmont Terrace Belmont, CA Mid-rise 71 1974 2006 96% Fourth & U Berkeley, CA Mid-rise 171 2010 2010 94% The Commons Campbell, CA Garden 264 1973 2010 97% Pointe at Cupertino Cupertino, CA Garden 116 1963 1998 97% Connolly Station Dublin, CA Mid-rise 309 2014 2014 96% Avenue 64 Emeryville, CA Mid-rise 224 2007 2014 96% Emme Emeryville, CA Mid-rise 190 2015 2015 94% The Courtyards at 65th Street (15) Emeryville, CA Mid-rise 331 2004 2019 94% Foster’s Landing Foster City, CA Garden 490 1987 2014 97% Boulevard Fremont, CA Garden 172 1978 1996 97% Briarwood (7) Fremont, CA Garden 160 1978 2011 97% Mission Peaks Fremont, CA Mid-rise 453 1995 2014 97% Mission Peaks II Fremont, CA Garden 336 1989 2014 97% Paragon Fremont, CA Mid-rise 301 2013 2014 96% Stevenson Place Fremont, CA Garden 200 1975 2000 96% The Rexford (16) Fremont, CA Garden 203 1973 2021 97% The Woods (7) Fremont, CA Garden 160 1978 2011 95% City Centre (12) Hayward, CA Mid-rise 192 2000 2014 95% City View Hayward, CA Garden 572 1975 1998 95% Lafayette Highlands Lafayette, CA Garden 150 1973 2014 97% 777 Hamilton (17) Menlo Park, CA Mid-rise 195 2017 2019 97% Apex Milpitas, CA Mid-rise 367 2014 2014 96% ARLO Mountain View Mountain View, CA Mid-rise 164 2018 2024 95% 28 Table of Contents Apartment Year Year Communities (1) Location Type Homes Built Acquired (2) Occupancy (3) Regency at Mountain View (6) Mountain View, CA Mid-rise 142 1970 2013 97% Bridgeport Newark, CA Garden 184 1987 1987 99% The Grand Oakland, CA High-rise 243 2009 2009 95% The Landing at Jack London Square Oakland, CA Mid-rise 282 2001 2014 94% The Galloway Pleasanton, CA Mid-rise 506 2016 2016 97% Radius Redwood City, CA Mid-rise 264 2015 2015 96% Township Redwood City, CA Mid-rise 132 2014 2019 96% San Marcos Richmond, CA Mid-rise 432 2003 2003 95% 500 Folsom (14) San Francisco, CA High-rise 537 2021 2021 96% Bennett Lofts San Francisco, CA Mid-rise 178 2004 2012 93% Fox Plaza San Francisco, CA High-rise 445 1968 2013 96% MB 360 San Francisco, CA Mid-rise 360 2014 2014 95% Park West San Francisco, CA Mid-rise 126 1958 2012 95% 101 San Fernando San Jose, CA Mid-rise 323 2001 2010 95% 360 Residences (15) San Jose, CA Mid-rise 213 2010 2017 95% Bella Villagio San Jose, CA Mid-rise 231 2004 2010 93% Century Towers San Jose, CA High-rise 376 2017 2017 97% Enso San Jose, CA Mid-rise 183 2014 2015 97% Epic San Jose, CA Mid-rise 769 2013 2013 97% Esplanade San Jose, CA Mid-rise 278 2002 2004 97% Fountains at River Oaks San Jose, CA Mid-rise 226 1990 2014 97% Marquis San Jose, CA Mid-rise 166 2015 2016 97% Meridian at Midtown (15) San Jose, CA Mid-rise 218 2015 2018 96% Mio San Jose, CA Mid-rise 103 2015 2016 97% Palm Valley San Jose, CA Mid-rise 1,100 2008 2014 96% Patina at Midtown San Jose, CA Mid-rise 269 2021 2021 96% Sage at Cupertino (5) San Jose, CA Garden 230 1971 2017 97% Silver (14) San Jose, CA Mid-rise 268 2019 2021 95% The Carlyle San Jose, CA Garden 132 2000 2000 97% Waterford Place San Jose, CA Mid-rise 238 2000 2000 96% Willow Lake San Jose, CA Mid-rise 508 1989 2012 97% Lakeshore Landing San Mateo, CA Mid-rise 308 1988 2014 96% Station Park Green San Mateo, CA Mid-rise 599 2018 2018 96% Deer Valley San Rafael, CA Garden 171 1996 2014 97% Bel Air San Ramon, CA Garden 462 1988 1995 97% Canyon Oaks San Ramon, CA Mid-rise 250 2005 2007 96% Crow Canyon San Ramon, CA Mid-rise 400 1992 2014 96% Foothill Gardens San Ramon, CA Garden 132 1985 1997 97% Mill Creek at Windermere San Ramon, CA Mid-rise 400 2005 2007 96% Twin Creeks San Ramon, CA Garden 44 1985 1997 97% 1000 Kiely Santa Clara, CA Garden 121 1971 2011 97% Le Parc Santa Clara, CA Garden 140 1975 1994 97% Marina Cove (18) Santa Clara, CA Garden 292 1974 1994 97% Mylo Santa Clara, CA Mid-rise 476 2021 2021 97% Riley Square (7) Santa Clara, CA Garden 156 1972 2012 96% Villa Granada Santa Clara, CA Mid-rise 270 2010 2014 97% Chestnut Street Santa Cruz, CA Garden 96 2002 2008 96% 29 Table of Contents Apartment Year Year Communities (1) Location Type Homes Built Acquired (2) Occupancy (3) Bristol Commons Sunnyvale, CA Garden 188 1989 1995 97% Brookside Oaks (5) Sunnyvale, CA Garden 170 1973 2000 97% Lawrence Station Sunnyvale, CA Mid-rise 336 2012 2014 97% Magnolia Lane (19) Sunnyvale, CA Garden 32 2001 2007 97% Magnolia Square (5) Sunnyvale, CA Garden 156 1963 2007 97% Maxwell Sunnyvale Sunnyvale, CA Mid-rise 75 2022 2024 95% Montclaire Sunnyvale, CA Mid-rise 390 1973 1988 96% Reed Square Sunnyvale, CA Garden 100 1970 2011 97% Solstice Sunnyvale, CA Mid-rise 280 2014 2014 97% Summerhill Park Sunnyvale, CA Garden 100 1988 1988 96% Via Sunnyvale, CA Mid-rise 284 2011 2011 97% Windsor Ridge Sunnyvale, CA Mid-rise 216 1989 1989 97% Vista Belvedere Tiburon, CA Mid-rise 76 1963 2004 95% Verandas (12) Union City, CA Mid-rise 282 1989 2014 97% Agora Walnut Creek, CA Mid-rise 49 2016 2016 97% Brio (5) Walnut Creek, CA Mid-rise 300 2015 2019 97% 22,804 96% Seattle, Washington Metropolitan Area Belcarra Bellevue, WA Mid-rise 296 2009 2014 96% BellCentre Bellevue, WA Mid-rise 249 2001 2014 97% Cedar Terrace Bellevue, WA Garden 180 1984 2005 97% Courtyard off Main Bellevue, WA Mid-rise 110 2000 2010 96% Ellington Bellevue, WA Mid-rise 220 1994 2014 96% Emerald Ridge Bellevue, WA Garden 180 1987 1994 96% Foothill Commons Bellevue, WA Mid-rise 394 1978 1990 97% Palisades, The Bellevue, WA Garden 192 1977 1990 96% Park Highland Bellevue, WA Mid-rise 250 1993 2014 96% Piedmont Bellevue, WA Garden 396 1969 2014 96% Sammamish View Bellevue, WA Garden 153 1986 1994 97% Woodland Commons Bellevue, WA Garden 302 1978 1990 97% Bothell Ridge Bothell, WA Garden 214 1988 2014 96% Canyon Pointe Bothell, WA Garden 250 1990 2003 97% Inglenook Court Bothell, WA Garden 224 1985 1994 96% Pinnacle Sonata Bothell, WA Mid-rise 268 2000 2014 97% Salmon Run at Perry Creek Bothell, WA Garden 132 2000 2000 97% Stonehedge Village Bothell, WA Garden 196 1986 1997 98% Highlands at Wynhaven Issaquah, WA Mid-rise 333 2000 2008 97% Park Hill at Issaquah Issaquah, WA Garden 245 1999 1999 97% Wandering Creek Kent, WA Garden 156 1986 1995 97% Ascent Kirkland, WA Garden 90 1988 2012 97% Bridle Trails Kirkland, WA Garden 108 1986 1997 97% Corbella at Juanita Bay Kirkland, WA Garden 169 1978 2010 97% Evergreen Heights Kirkland, WA Garden 200 1990 1997 97% Montebello Kirkland, WA Garden 248 1996 2012 97% Slater 116 Kirkland, WA Mid-rise 108 2013 2013 97% Martha Lake (16) Lynwood, WA Mid-rise 155 1991 2021 97% Aviara (19) Mercer Island, WA Mid-rise 166 2013 2014 97% 30 Table of Contents Apartment Year Year Communities (1) Location Type Homes Built Acquired (2) Occupancy (3) Laurels at Mill Creek Mill Creek, WA Garden 164 1981 1996 96% Monterra in Mill Creek (16) Mill Creek, WA Garden 139 2003 2021 97% Parkwood at Mill Creek Mill Creek, WA Garden 240 1989 2014 97% The Elliot at Mukilteo (5) Mukilteo, WA Garden 301 1981 1997 97% Castle Creek Newcastle, WA Garden 216 1998 1998 97% Elevation Redmond, WA Garden 158 1986 2010 97% Pure Redmond Redmond, WA Mid-rise 105 2016 2019 97% Redmond Hill (7) Redmond, WA Garden 442 1985 2011 97% Shadowbrook Redmond, WA Garden 418 1986 2014 97% The Trails of Redmond Redmond, WA Garden 423 1985 2014 97% Vesta (7) Redmond, WA Garden 440 1998 2011 97% Brighton Ridge Renton, WA Garden 264 1986 1996 95% Fairwood Pond Renton, WA Garden 194 1997 2004 96% Forest View Renton, WA Garden 192 1998 2003 97% Pinnacle on Lake Washington Renton, WA Mid-rise 180 2001 2014 97% 8th & Republican (15) Seattle, WA Mid-rise 211 2016 2017 97% Annaliese Seattle, WA Mid-rise 56 2009 2013 98% The Bernard Seattle, WA Mid-rise 63 2008 2011 97% Cairns, The Seattle, WA Mid-rise 99 2006 2007 96% Collins on Pine Seattle, WA Mid-rise 76 2013 2014 96% Canvas Seattle, WA Mid-rise 123 2014 2021 96% Domaine Seattle, WA Mid-rise 92 2009 2012 96% Expo (14) Seattle, WA Mid-rise 275 2012 2012 97% Fountain Court Seattle, WA Mid-rise 320 2000 2000 97% Patent 523 Seattle, WA Mid-rise 295 2010 2010 97% Taylor 28 Seattle, WA Mid-rise 197 2008 2014 97% The Audrey at Belltown Seattle, WA Mid-rise 137 1992 2014 97% Velo and Ray (15) Seattle, WA Mid-rise 308 2014 2019 96% Vox Seattle, WA Mid-rise 58 2013 2013 96% Wharfside Pointe Seattle, WA Mid-rise 155 1990 1994 96% Beaumont Woodinville, WA Mid-rise 344 2009 2024 93% 12,869 97% Total: 62,157 Weighted Average: 96% Footnotes to the Company’s Portfolio Listing as of December 31, 2024 (1) Unless otherwise specified, the Company consolidates each community in accordance with U.S.
Biggest changeFurthermore, as of December 31, 2025, the commercial buildings’ physical occupancy rate was 85% consisting of six tenants, including the Company. 25 Table of Contents Operating Portfolio The table below describes the Company’s operating portfolio as of December 31, 2025 (See Note 8, “Mortgage Notes Payable” to the Company’s consolidated financial statements included in Part IV, Item 15 of this Annual Report on Form 10-K for more information about the Company’s secured mortgage debt and Schedule III thereto for a list of secured mortgage loans related to the Company’s portfolio.): Apartment Year Year Communities (1) Location Type Homes Built Acquired (2) Occupancy (3) Southern California Alpine Village Alpine, CA Garden 301 1971 2002 96% Park Viridian Anaheim, CA Mid-rise 326 2008 2014 95% The Barkley (4)(5) Anaheim, CA Garden 161 1984 2000 96% Bonita Cedars Bonita, CA Garden 120 1983 2002 96% The Village at Toluca Lake Burbank, CA Mid-rise 146 1974 2017 97% Camarillo Oaks Camarillo, CA Garden 564 1985 1996 96% Camino Ruiz Square Camarillo, CA Garden 160 1990 2006 97% Hacienda at Camarillo Oaks Camarillo, CA Garden 73 1984 2023 94% Pinnacle at Otay Ranch I & II Chula Vista, CA Mid-rise 364 2001 2014 96% Mesa Village Clairemont, CA Garden 133 1963 2002 96% Villa Siena Costa Mesa, CA Garden 274 1974 2014 96% Emerald Pointe Diamond Bar, CA Garden 160 1989 2014 97% Regency at Encino Encino, CA Mid-rise 75 1989 2009 96% The Havens Fountain Valley, CA Garden 440 1969 2014 96% Valley Park Fountain Valley, CA Garden 160 1969 2001 97% Capri at Sunny Hills (5) Fullerton, CA Garden 102 1961 2001 95% Haver Hill (6) Fullerton, CA Garden 265 1973 2012 96% Pinnacle at Fullerton Fullerton, CA Mid-rise 192 2004 2014 96% Wilshire Promenade Fullerton, CA Mid-rise 149 1992 1997 96% Montejo Garden Grove, CA Garden 124 1974 2001 96% The Henley I Glendale, CA Mid-rise 83 1974 1999 96% The Henley II Glendale, CA Mid-rise 132 1970 1999 96% Huntington Breakers Huntington Beach, CA Mid-rise 344 1984 1997 96% The Huntington Huntington Beach, CA Garden 276 1975 2012 96% Hillsborough Park La Habra, CA Garden 235 1999 1999 97% Village Green La Habra, CA Garden 272 1971 2014 97% The Palms at Laguna Niguel Laguna Niguel, CA Garden 460 1988 2014 96% Trabuco Villas Lake Forest, CA Mid-rise 132 1985 1997 98% Marbrisa Long Beach, CA Mid-rise 202 1987 2002 97% Pathways at Bixby Village Long Beach, CA Garden 296 1975 1991 96% 5600 Wilshire Los Angeles, CA Mid-rise 284 2008 2014 96% Alessio Los Angeles, CA Mid-rise 624 2001 2014 95% Ashton Sherman Village Los Angeles, CA Mid-rise 264 2014 2016 96% Avant Los Angeles, CA Mid-rise 443 2014 2015 93% The Avery Los Angeles, CA Mid-rise 122 2014 2014 96% Bellerive Los Angeles, CA Mid-rise 63 2011 2011 95% Belmont Station Los Angeles, CA Mid-rise 275 2009 2009 96% Catalina Gardens Los Angeles, CA Mid-rise 128 1987 2014 96% Cochran Apartments Los Angeles, CA Mid-rise 58 1989 1998 97% Emerson Valley Village Los Angeles, CA Mid-rise 144 2012 2016 97% Gas Company Lofts (6) Los Angeles, CA High-rise 251 2004 2013 95% 26 Table of Contents Marbella Los Angeles, CA Mid-rise 60 1991 2005 97% Pacific Electric Lofts (7) Los Angeles, CA High-rise 314 2006 2012 94% Park Catalina Los Angeles, CA Mid-rise 90 2002 2012 96% Park Place Los Angeles, CA Mid-rise 60 1988 1997 97% Regency Palm Court Los Angeles, CA Mid-rise 116 1987 2014 94% Santee Court Los Angeles, CA High-rise 165 2004 2010 93% Santee Village Los Angeles, CA High-rise 73 2011 2011 93% Skye at Bunker Hill Los Angeles, CA High-rise 456 1968 1998 96% TENTEN Downtown Los Angeles, CA Mid-rise 376 2021 2025 88% The Blake LA Los Angeles, CA Mid-rise 196 1979 1997 96% Tiffany Court Los Angeles, CA Mid-rise 101 1987 2014 95% Wallace on Sunset Los Angeles, CA Mid-rise 200 2021 2021 95% Wilshire La Brea Los Angeles, CA Mid-rise 478 2014 2014 96% Windsor Court Los Angeles, CA Mid-rise 95 1987 2014 93% Windsor Court Los Angeles, CA Mid-rise 58 1988 1997 97% Aqua at Marina Del Rey Marina Del Rey, CA Mid-rise 500 2001 2014 96% Marina City Club (8) Marina Del Rey, CA Mid-rise 101 1971 2004 96% Mirabella Marina Del Rey, CA Mid-rise 188 2000 2000 95% Mira Monte Mira Mesa, CA Garden 356 1982 2002 96% Hillcrest Park Newbury Park, CA Garden 608 1973 1998 97% Fairway at Big Canyon (9) Newport Beach, CA Mid-rise 74 1972 1999 96% Muse North Hollywood, CA Mid-rise 152 2011 2011 95% Country Villas Oceanside, CA Garden 180 1976 2002 95% Mission Hills Oceanside, CA Garden 282 1984 2005 96% Renaissance at Uptown Orange Orange, CA Mid-rise 460 2007 2014 97% Arbors at Parc Rose (7) Oxnard, CA Mid-rise 373 2001 2011 96% Mariner’s Place Oxnard, CA Garden 106 1987 2000 98% Monterey Villas Oxnard, CA Garden 122 1974 1997 95% Tierra Vista Oxnard, CA Mid-rise 404 2001 2001 97% The Hallie Pasadena, CA Mid-rise 292 1972 1997 96% The Stuart Pasadena, CA Mid-rise 188 2007 2014 97% Villa Angelina Placentia, CA Garden 256 1970 2001 97% Fountain Park Playa Vista, CA Mid-rise 705 2002 2004 93% Cortesia Rancho Santa Margarita, CA Garden 308 1999 2014 97% Pinnacle at Talega San Clemente, CA Mid-rise 362 2002 2014 96% Allure at Scripps Ranch San Diego, CA Mid-rise 194 2002 2014 96% Bernardo Crest San Diego, CA Garden 218 1988 2014 96% Cambridge Park San Diego, CA Mid-rise 320 1998 2014 96% Carmel Creek San Diego, CA Garden 348 2000 2014 96% Carmel Landing San Diego, CA Garden 356 1989 2014 96% Carmel Summit San Diego, CA Mid-rise 248 1989 2014 96% CentrePointe San Diego, CA Garden 224 1974 1997 96% Esplanade San Diego, CA Garden 614 1986 2014 95% Form 15 San Diego, CA Mid-rise 242 2014 2016 96% LIVIA at Scripps Ranch (10)(13) San Diego, CA Mid-rise 264 2024 2024 97% Montanosa San Diego, CA Garden 472 1990 2014 97% Summit Park San Diego, CA Garden 300 1972 2002 97% Fairhaven (5) Santa Ana, CA Garden 164 1970 2001 96% 27 Table of Contents Parkside Court Santa Ana, CA Mid-rise 210 1986 2014 96% Pinnacle at MacArthur Place Santa Ana, CA Mid-rise 253 2002 2014 97% Hope Ranch Santa Barbara, CA Garden 108 1965 2007 95% Bridgeport Coast (11) Santa Clarita, CA Mid-rise 188 2006 2014 96% Meadowood Simi Valley, CA Garden 320 1986 1996 95% Shadow Point Spring Valley, CA Garden 172 1983 2002 95% The Fairways at Westridge (11) Valencia, CA Mid-rise 234 2004 2014 96% The Vistas of West Hills (11) Valencia, CA Mid-rise 220 2009 2014 97% Allegro Valley Village, CA Mid-rise 97 2010 2010 96% Lofts at Pinehurst, The Ventura, CA Garden 118 1971 1997 95% Pinehurst (12) Ventura, CA Garden 28 1973 2004 95% Woodside Village Ventura, CA Garden 145 1987 2004 95% Passage Buena Vista (13) Vista, CA Garden 179 2020 2021 97% Walnut Heights Walnut, CA Garden 163 1964 2003 93% The Dylan West Hollywood, CA Mid-rise 184 2014 2014 95% The Huxley West Hollywood, CA Mid-rise 187 2014 2014 96% Avondale at Warner Center Woodland Hills, CA Mid-rise 446 1970 1999 96% Reveal Woodland Hills, CA Mid-rise 438 2010 2011 96% Vela (15) Woodland Hills, CA Mid-rise 379 2018 2022 96% 26,265 96% Northern California Belmont Terrace Belmont, CA Mid-rise 71 1974 2006 96% Revere Campbell (5) Campbell, CA Mid-rise 168 2015 2025 95% The Commons Campbell, CA Garden 264 1973 2010 96% The Parc at Pruneyard Campbell, CA Garden 252 1968 2025 95% Pointe at Cupertino Cupertino, CA Garden 116 1963 1998 96% Connolly Station Dublin, CA Mid-rise 309 2014 2014 97% Avenue 64 Emeryville, CA Mid-rise 224 2007 2014 96% Emme Emeryville, CA Mid-rise 190 2015 2015 95% The Courtyards at 65th Street (14) Emeryville, CA Mid-rise 331 2004 2019 96% Foster’s Landing Foster City, CA Garden 490 1987 2014 97% One Hundred Grand (5) Foster City, CA Mid-rise 166 2016 2025 95% The Plaza Foster City, CA Mid-rise 307 2013 2025 96% Boulevard Fremont, CA Garden 172 1978 1996 96% Briarwood (7) Fremont, CA Garden 160 1978 2011 97% Mission Peaks Fremont, CA Mid-rise 453 1995 2014 97% Mission Peaks II Fremont, CA Garden 336 1989 2014 97% Paragon Fremont, CA Mid-rise 301 2013 2014 96% Stevenson Place Fremont, CA Garden 200 1975 2000 96% The Rexford (15) Fremont, CA Garden 203 1973 2021 94% The Woods (7) Fremont, CA Garden 160 1978 2011 96% City Centre (11) Hayward, CA Mid-rise 192 2000 2014 96% City View Hayward, CA Garden 572 1975 1998 97% Lafayette Highlands Lafayette, CA Garden 150 1973 2014 96% 777 Hamilton (16) Menlo Park, CA Mid-rise 195 2017 2019 97% ROEN Menlo Park Menlo Park, CA Garden 146 2017 2025 94% Apex Milpitas, CA Mid-rise 367 2014 2014 97% ARLO Mountain View Mountain View, CA Mid-rise 164 2018 2024 97% Regency at Mountain View (6) Mountain View, CA Mid-rise 142 1970 2013 97% 28 Table of Contents Bridgeport Newark, CA Garden 184 1987 1987 96% Artizan Oakland, CA Mid-rise 241 2022 2025 94% The Landing at Jack London Square Oakland, CA Mid-rise 282 2001 2014 96% The Galloway Pleasanton, CA Mid-rise 506 2016 2016 96% Radius Redwood City, CA Mid-rise 264 2015 2015 97% Township Redwood City, CA Mid-rise 132 2014 2019 96% San Marcos Richmond, CA Mid-rise 432 2003 2003 96% 500 Folsom (13) San Francisco, CA High-rise 537 2021 2021 97% Bennett Lofts San Francisco, CA Mid-rise 178 2004 2012 96% Fox Plaza San Francisco, CA High-rise 445 1968 2013 97% MB 360 San Francisco, CA Mid-rise 360 2014 2014 97% Park West San Francisco, CA Mid-rise 126 1958 2012 96% 101 San Fernando San Jose, CA Mid-rise 323 2001 2010 96% 360 Residences (14) San Jose, CA Mid-rise 213 2010 2017 96% Bella Villagio San Jose, CA Mid-rise 231 2004 2010 92% Century Towers San Jose, CA High-rise 376 2017 2017 97% Enso San Jose, CA Mid-rise 183 2014 2015 97% Epic San Jose, CA Mid-rise 769 2013 2013 97% Esplanade San Jose, CA Mid-rise 278 2002 2004 96% Fountains at River Oaks San Jose, CA Mid-rise 226 1990 2014 97% Marquis San Jose, CA Mid-rise 166 2015 2016 96% Meridian at Midtown (14) San Jose, CA Mid-rise 218 2015 2018 96% Mio San Jose, CA Mid-rise 103 2015 2016 97% Palm Valley San Jose, CA Mid-rise 1,100 2008 2014 96% Patina at Midtown San Jose, CA Mid-rise 269 2021 2021 96% Sage at Cupertino (5) San Jose, CA Garden 230 1971 2017 97% Silver (13) San Jose, CA Mid-rise 268 2019 2021 95% The Carlyle San Jose, CA Garden 132 2000 2000 95% ViO San Jose, CA Mid-rise 234 2016 2025 94% Waterford Place San Jose, CA Mid-rise 238 2000 2000 96% Willow Lake San Jose, CA Mid-rise 508 1989 2012 97% Lakeshore Landing San Mateo, CA Mid-rise 308 1988 2014 97% Station Park Green San Mateo, CA Mid-rise 599 2018 2018 97% Deer Valley San Rafael, CA Garden 171 1996 2014 93% Bel Air San Ramon, CA Garden 462 1988 1995 97% Canyon Oaks San Ramon, CA Mid-rise 250 2005 2007 95% Crow Canyon San Ramon, CA Mid-rise 400 1992 2014 96% Foothill Gardens San Ramon, CA Garden 132 1985 1997 97% Mill Creek at Windermere San Ramon, CA Mid-rise 400 2005 2007 96% Twin Creeks San Ramon, CA Garden 44 1985 1997 97% 1000 Kiely Santa Clara, CA Garden 121 1971 2011 96% Le Parc Santa Clara, CA Garden 140 1975 1994 97% Marina Cove (17) Santa Clara, CA Garden 292 1974 1994 96% Mylo Santa Clara, CA Mid-rise 476 2021 2021 98% Riley Square (7) Santa Clara, CA Garden 156 1972 2012 98% Villa Granada Santa Clara, CA Mid-rise 270 2010 2014 97% Chestnut Street Santa Cruz, CA Garden 96 2002 2008 92% 1250 Lakeside Sunnyvale, CA Mid-rise 250 2021 2025 98% Bristol Commons Sunnyvale, CA Garden 188 1989 1995 97% 29 Table of Contents Brookside Oaks (5) Sunnyvale, CA Garden 170 1973 2000 96% Lawrence Station Sunnyvale, CA Mid-rise 336 2012 2014 96% Magnolia Lane (18) Sunnyvale, CA Garden 32 2001 2007 97% Magnolia Square (5) Sunnyvale, CA Garden 156 1963 2007 97% Maxwell Sunnyvale Sunnyvale, CA Mid-rise 75 2022 2024 95% Montclaire Sunnyvale, CA Mid-rise 390 1973 1988 97% Reed Square Sunnyvale, CA Garden 100 1970 2011 97% Solstice Sunnyvale, CA Mid-rise 280 2014 2014 97% Summerhill Park Sunnyvale, CA Garden 100 1988 1988 97% Via Sunnyvale, CA Mid-rise 284 2011 2011 97% Windsor Ridge Sunnyvale, CA Mid-rise 216 1989 1989 96% Vista Belvedere Tiburon, CA Mid-rise 76 1963 2004 96% Verandas (11) Union City, CA Mid-rise 282 1989 2014 97% Agora Walnut Creek, CA Mid-rise 49 2016 2016 95% Brio (5) Walnut Creek, CA Mid-rise 300 2015 2019 97% 24,154 96% Seattle, Washington Metropolitan Area Belcarra Bellevue, WA Mid-rise 296 2009 2014 97% BellCentre Bellevue, WA Mid-rise 249 2001 2014 97% Cedar Terrace Bellevue, WA Garden 180 1984 2005 96% Courtyard off Main Bellevue, WA Mid-rise 110 2000 2010 95% Ellington Bellevue, WA Mid-rise 220 1994 2014 97% Emerald Ridge Bellevue, WA Garden 180 1987 1994 96% Foothill Commons Bellevue, WA Mid-rise 394 1978 1990 97% Palisades, The Bellevue, WA Garden 192 1977 1990 97% Park Highland Bellevue, WA Mid-rise 250 1993 2014 97% Piedmont Bellevue, WA Garden 396 1969 2014 96% Sammamish View Bellevue, WA Garden 153 1986 1994 97% Woodland Commons Bellevue, WA Garden 302 1978 1990 96% Bothell Ridge Bothell, WA Garden 214 1988 2014 96% Canyon Pointe Bothell, WA Garden 250 1990 2003 96% Inglenook Court Bothell, WA Garden 224 1985 1994 96% Pinnacle Sonata Bothell, WA Mid-rise 268 2000 2014 97% Salmon Run at Perry Creek Bothell, WA Garden 132 2000 2000 96% Stonehedge Village Bothell, WA Garden 196 1986 1997 95% Highlands at Wynhaven Issaquah, WA Mid-rise 333 2000 2008 97% Park Hill at Issaquah Issaquah, WA Garden 245 1999 1999 95% Wandering Creek Kent, WA Garden 156 1986 1995 96% Ascent Kirkland, WA Garden 90 1988 2012 96% Bridle Trails Kirkland, WA Garden 108 1986 1997 96% Corbella at Juanita Bay Kirkland, WA Garden 169 1978 2010 96% Evergreen Heights Kirkland, WA Garden 200 1990 1997 96% Montebello Kirkland, WA Garden 248 1996 2012 96% Slater 116 Kirkland, WA Mid-rise 108 2013 2013 97% Martha Lake (15) Lynwood, WA Mid-rise 155 1991 2021 95% Aviara (18) Mercer Island, WA Mid-rise 166 2013 2014 96% Laurels at Mill Creek Mill Creek, WA Garden 164 1981 1996 96% Monterra in Mill Creek (15) Mill Creek, WA Garden 139 2003 2021 97% Parkwood at Mill Creek Mill Creek, WA Garden 240 1989 2014 97% 30 Table of Contents The Elliot at Mukilteo (5) Mukilteo, WA Garden 301 1981 1997 97% Castle Creek Newcastle, WA Garden 216 1998 1998 97% Elevation Redmond, WA Garden 158 1986 2010 97% Pure Redmond Redmond, WA Mid-rise 105 2016 2019 97% Redmond Hill (7) Redmond, WA Garden 442 1985 2011 96% Shadowbrook Redmond, WA Garden 418 1986 2014 96% The Trails of Redmond Redmond, WA Garden 423 1985 2014 96% Vesta (7) Redmond, WA Garden 440 1998 2011 96% Brighton Ridge Renton, WA Garden 264 1986 1996 95% Fairwood Pond Renton, WA Garden 194 1997 2004 95% Forest View Renton, WA Garden 192 1998 2003 95% Pinnacle on Lake Washington Renton, WA Mid-rise 180 2001 2014 95% Annaliese Seattle, WA Mid-rise 56 2009 2013 97% The Bernard Seattle, WA Mid-rise 63 2008 2011 96% Cairns, The Seattle, WA Mid-rise 99 2006 2007 97% Collins on Pine Seattle, WA Mid-rise 76 2013 2014 98% Canvas Seattle, WA Mid-rise 123 2014 2021 97% Domaine Seattle, WA Mid-rise 92 2009 2012 95% Expo (13) Seattle, WA Mid-rise 275 2012 2012 96% Fountain Court Seattle, WA Mid-rise 320 2000 2000 97% Patent 523 Seattle, WA Mid-rise 295 2010 2010 96% Taylor 28 Seattle, WA Mid-rise 197 2008 2014 97% The Audrey at Belltown Seattle, WA Mid-rise 137 1992 2014 95% Velo and Ray (14) Seattle, WA Mid-rise 308 2014 2019 95% Vox Seattle, WA Mid-rise 58 2013 2013 95% Wharfside Pointe Seattle, WA Mid-rise 155 1990 1994 96% Beaumont Woodinville, WA Mid-rise 344 2009 2024 96% 12,658 96% Total: 63,077 Weighted Average: 96% Footnotes to the Company’s Portfolio Listing as of December 31, 2025 (1) Unless otherwise specified, the Company consolidates each community in accordance with U.S.
The Company has a 50% interest in Wesco III, which is accounted for using the equity method of accounting. (7) This community is owned by Wesco I, LLC (“Wesco I”).
The Company has a 50% interest in Wesco III, which is accounted for using the equity method of accounting. (7) This community is owned by Wesco I, LLC (“Wesco I”). The Company has a 58% interest in Wesco I, which is accounted for using the equity method of accounting.
GAAP. (2) Represents the initial year the joint venture or consolidated community was acquired. (3) For communities, occupancy rates are based on financial occupancy for the year ended December 31, 2024, except for communities that were stabilized during the year, in which case physical occupancy was used.
GAAP. (2) Represents the initial year the joint venture or consolidated community was acquired. (3) For communities, occupancy rates are based on financial occupancy for the year ended December 31, 2025, except for communities that were stabilized during the year, in which case physical occupancy was used.
Commercial Buildings The Company owns two operating commercial buildings (totaling approximately 185,000 square feet) located in California and Washington, of which the Company occupied an aggregate of approximately 50,000 square feet as of December 31, 2024.
Commercial Buildings The Company owns two operating commercial buildings (totaling approximately 185,000 square feet) located in California and Washington, of which the Company occupied an aggregate of approximately 50,000 square feet as of December 31, 2025.
The Company’s apartment communities accounted for 99.0% of the Company’s revenues for the year ended December 31, 2024. Occupancy Rates Financial occupancy is defined as the percentage resulting from dividing actual rental income by total scheduled rental income.
The Company’s apartment communities accounted for 99.2% of the Company’s revenues for the year ended December 31, 2025. Occupancy Rates Financial occupancy is defined as the percentage resulting from dividing actual rental income by total scheduled rental income.
The Company has a 50% interest in Wesco V, which is accounted for using the equity method of accounting. (16) This community is owned by Wesco VI, LLC (“Wesco VI”). The Company has a 50% interest in Wesco VI, which is accounted for using the equity method of accounting. (17) This community is owned by BEX IV, LLC (“BEX IV”).
The Company has a 50% interest in Wesco VI, which is accounted for using the equity method of accounting. (16) This community is owned by BEX IV, LLC (“BEX IV”). The Company has a 50.1% interest in BEX IV, which is accounted for using the equity method of accounting.
Communities The Company’s communities are primarily urban and suburban high density wood frame communities comprising of two to seven stories above grade construction with structured parking situated on 1-20 acres of land with densities of approximately 10 to 80+ units per acre. As of December 31, 2024, the Company’s communities include 103 garden-style, 142 mid-rise, and 10 high-rise communities.
Communities The Company’s communities are primarily urban and suburban high density wood frame communities comprising of two to seven stories above grade construction situated on 1-20 acres of land with densities of approximately 10 to 80+ units per acre. As of December 31, 2025, the Company’s communities include 105 garden-style, 146 mid-rise, and 8 high-rise communities.
Properties The Company’s portfolio as of December 31, 2024 (including communities owned by unconsolidated joint ventures, but excluding communities underlying preferred equity investments) was comprised of 255 stabilized operating apartment communities (comprising 62,157 apartment homes), of which 26,484 apartment homes are located in Southern California, 22,804 apartment homes are located in Northern California, and 12,869 apartment homes are located in the Seattle metropolitan area.
Properties The Company’s portfolio as of December 31, 2025 (including communities owned by unconsolidated joint ventures, but excluding communities underlying preferred equity investments) was comprised of 259 stabilized operating apartment communities (comprising 63,077 apartment homes), of which 26,265 apartment homes are located in Southern California, 24,154 apartment homes are located in Northern California, and 12,658 apartment homes are located in the Seattle metropolitan area.
The Company has a 65.1% interest in Wesco IV, which is accounted for using the equity method of accounting. (13) This community is subject to a ground lease, which, unless extended, will expire in 2028. (14) The Company has an interest in a single asset entity owning this community. (15) This community is owned by Wesco V, LLC (“Wesco V”).
The Company has a 65.1% interest in Wesco IV, which is accounted for using the equity method of accounting. (12) This community is subject to a ground lease, which, unless extended, will expire in 2028.
The Company has a 50.1% interest in BEX IV, which is accounted for using the equity method of accounting. (18) A portion of this community on which 84 apartment homes are presently located is subject to a ground lease, which, unless extended, will expire in 2028.
(17) A portion of this community on which 84 apartment homes are presently located is subject to a ground lease, which, unless extended, will expire in 2028. (18) The community is subject to a ground lease, which, unless extended, will expire in 2070.
(10) The community is subject to a ground lease, which, unless extended, will expire in 2086. (11) The Company has a 97% interest and a former Executive Vice President of the Company has a 3% interest in this community. (12) This community is owned by Wesco IV, LLC (“Wesco IV”).
(8) This community is subject to a ground lease, which, unless extended, will expire in 2067. (9) This community is subject to a ground lease, which, unless extended, will expire in 2027. (10) The community is subject to a ground lease, which, unless extended, will expire in 2086. (11) This community is owned by Wesco IV, LLC (“Wesco IV”).
The Company has a 58% interest in Wesco I, which is accounted for using the equity method of accounting. 31 Table of Contents (8) This community is subject to a ground lease, which, unless extended, will expire in 2067. (9) This community is subject to a ground lease, which, unless extended, will expire in 2027.
(13) The Company has an interest in a single asset entity owning this community. 31 Table of Contents (14) This community is owned by Wesco V, LLC (“Wesco V”). The Company has a 50% interest in Wesco V, which is accounted for using the equity method of accounting. (15) This community is owned by Wesco VI, LLC (“Wesco VI”).
Removed
(19) The community is subject to a ground lease, which, unless extended, will expire in 2070.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

17 edited+2 added−0 removed9 unchanged
Biggest changeAs of February 19, 2025, there were 62 holders of record of OP Units, including Essex. Return of Capital Under provisions of the Code, the portion of the cash dividend, if any, that exceeds earnings and profits is considered a return of capital.
Biggest changeReturn of Capital Under the applicable provisions of the Code, the portion of any cash distribution on Essex’s common stock paid out of its current or accumulated earnings and profits is treated as a dividend, and the portion of such cash distribution, if any, that exceeds its earnings and profits is treated as a return of capital, for federal income tax purposes.
There are currently no contractual restrictions on Essex’s and the Operating Partnership’s present or future ability to pay dividends and distributions, and we do not anticipate that our ability to pay dividends/distributions will be impaired; however, there can be no assurances in that regard.
There are currently no contractual restrictions on Essex’s and the Operating Partnership’s present or future ability to pay dividends or distributions, and we do not anticipate that our ability to pay dividends or distributions will be impaired; however, there can be no assurances in that regard.
For a copy of the plan, contact Computershare, LLC at (312) 360-5354. 33 Table of Contents Securities Authorized for Issuance under Equity Compensation Plans The information required by this section is incorporated herein by reference from our Proxy Statement, relating to our 2025 Annual Meeting of Shareholders, under the heading “Equity Compensation Plans,” to be filed with the SEC within 120 days of December 31, 2024.
For a copy of the plan, contact Computershare, LLC at (312) 360-5354. 33 Table of Contents Securities Authorized for Issuance under Equity Compensation Plans The information required by this section is incorporated herein by reference from our Proxy Statement, relating to our 2026 Annual Meeting of Shareholders, under the heading “Equity Compensation Plans,” to be filed with the SEC within 120 days of December 31, 2025.
During the year ended December 31, 2024, the Company did not repurchase any shares. As of December 31, 2024, the Company had $302.7 million of purchase authority remaining under the stock repurchase plan.
During the year ended December 31, 2025, the Company did not repurchase any shares. As of December 31, 2025, the Company had $302.7 million of purchase authority remaining under the stock repurchase plan.
Unregistered Sales of Equity Securities During the years ended December 31, 2024 and 2023, 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 years ended December 31, 2024 and 2023, Essex issued an aggregate of 56,304 and zero shares of its common stock upon the exercise of stock options, respectively.
Unregistered Sales of Equity Securities During the years ended December 31, 2025 and 2024, 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 years ended December 31, 2025 and 2024, Essex issued an aggregate of 41,408 and 56,304 shares of its common stock upon the exercise of stock options, respectively.
The Board of Directors declared a dividend/distribution for the fourth quarter of 2024 of $2.45 per share. The dividend/distribution was paid on January 15, 2025 to stockholders/unitholders of record as of January 2, 2025.
The Board of Directors declared a dividend/distribution for the fourth quarter of 2025 of $2.57 per share. The dividend/distribution was paid on January 15, 2026 to stockholders/unitholders of record as of January 2, 2026.
For each share of common stock issued by Essex in connection with such exchange, the Operating Partnership issued OP Units to Essex as required by the Operating Partnership’s partnership agreement, for an aggregate of 7,448 and 13,684 OP Units during the years ended December 31, 2024 and 2023, respectively.
For each share of common stock issued by Essex in connection with such exchange, the Operating Partnership issued OP Units to Essex as required by the Operating Partnership’s partnership agreement, for an aggregate of 81,014 and 7,448 OP Units during the years ended December 31, 2025 and 2024, respectively.
Holders The approximate number of holders of record of the shares of Essex’s common stock was 973 as of February 19, 2025. This number does not include stockholders whose shares are held in investment accounts by other entities. Essex believes the actual number of stockholders is greater than the number of holders of record.
Holders The approximate number of holders of record of the shares of Essex’s common stock was 931 as of February 13, 2026. This number does not include stockholders whose shares are held in investment accounts by other entities. Essex believes the actual number of stockholders is greater than the number of holders of record.
For each share of common stock issued by Essex in connection with such awards, the Operating Partnership issued OP Units to Essex as required by the Operating Partnership’s partnership agreement, for an aggregate of 13,217 and 22,236 OP Units during the years ended December 31, 2024 and 2023, respectively. 35 Table of Contents During the years ended December 31, 2024 and 2023, Essex issued an aggregate of 7,448 and 13,684 shares of its common stock in connection with the exchange of OP Units by limited partners into shares of common stock.
For each share of common stock issued by Essex in connection with such awards, the Operating Partnership issued OP Units to Essex as required by the Operating Partnership’s partnership agreement, for an aggregate of 39,402 and 13,217 OP Units during the years ended December 31, 2025 and 2024, respectively. 35 Table of Contents During the years ended December 31, 2025 and 2024, Essex issued an aggregate of 81,014 and 7,448 shares of its common stock in connection with the exchange of OP Units by limited partners into shares of common stock.
Cash dividends distributed for the years ended December 31, 2024, 2023 and 2022 related to common stock were classified for federal income tax purposes as follows: Year Ended December 31, 2024 2023 2022 Common Stock Ordinary income 98.19 % 88.46 % 80.17 % Capital gain 1.81 % 8.32 % 16.78 % Unrecaptured section 1250 capital gain — % 3.22 % 3.05 % 100.00 % 100.00 % 100.00 % Dividends and Distributions Future dividends/distributions by Essex and the Operating Partnership will be at the discretion of the Board of Directors of Essex and will depend on the actual cash flows from operations of the Company, its financial condition, capital requirements, the annual distribution requirements under the REIT provisions of the Code, applicable legal restrictions and such other factors as the Board of Directors deems relevant.
Cash dividends on Essex’s common stock for the years ended December 31, 2025, 2024 and 2023 were classified for federal income tax purposes as follows: Year Ended December 31, 2025 2024 2023 Common Stock Ordinary income 96.74 % 98.19 % 88.46 % Capital gain 1.43 % 1.81 % 8.32 % Unrecaptured section 1250 capital gain 1.83 % — % 3.22 % 100.00 % 100.00 % 100.00 % Dividends and Distributions Future dividends and distributions by Essex and the Operating Partnership will be at the discretion of the Board of Directors of Essex and will depend on the actual cash flows from operations of the Company, its financial condition, capital requirements, the annual distribution requirements under the REIT provisions of the Code, applicable legal restrictions and such other factors as the Board of Directors deems relevant.
During the years ended December 31, 2024 and 2023, Essex issued an aggregate of 13,217 and 22,236 shares, respectively, of its common stock in connection with restricted stock awards for no cash consideration.
During the years ended December 31, 2025 and 2024, Essex issued an aggregate of 39,402 and 13,217 shares, respectively, of its common stock in connection with restricted stock awards for no cash consideration.
The return of capital is generated due to a variety of factors, including the deduction of non-cash expenses, primarily depreciation, in the determination of earnings and profits.
Such return of capital may arise due to a variety of factors, including the deduction of non-cash expenses, primarily depreciation, in the determination of earnings and profits.
Essex contributed the proceeds from the option exercises of $12.3 million to the Operating Partnership in exchange for an aggregate of 56,304 OP Units, as required by the Operating Partnership’s partnership agreement, during the year ended December 31, 2024.
Essex contributed the proceeds from the option exercises of $8.9 million to the Operating Partnership in exchange for an aggregate of 41,408 OP Units, as required by the Operating Partnership’s partnership agreement, during the year ended December 31, 2025.
The 2024 ATM Program replaced the 2021 ATM Program, which was terminated upon the establishment of the 2024 ATM Program. During the year ended December 31, 2024, the Company did not issue any shares of common stock under the 2024 ATM Program or the 2021 ATM Program.
During the year ended December 31, 2025, the Company did not issue any shares of common stock under the 2024 ATM Program.
During the years ended December 31, 2024 and 2023, the Company did not issue or sell any shares of common stock pursuant to the 2024 ATM Program and 2021 ATM Program. As of December 31, 2024, there were no outstanding forward sale agreements. 36 Table of Contents
During the years ended December 31, 2025 and 2024, the Company did not issue or sell any shares of common stock pursuant to the 2024 ATM Program.
This comparison assumes that the value of the investment in the common stock and each index was $100 on December 31, 2019 and that all dividends were reinvested. 34 Table of Contents Index 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024 Essex Property Trust, Inc. $ 100.00 $ 81.91 $ 124.83 $ 77.69 $ 94.76 $ 112.16 FTSE NAREIT Equity Apartments Index $ 100.00 $ 84.66 $ 138.51 $ 94.25 $ 99.78 $ 120.22 S&P 500 Index $ 100.00 $ 118.40 $ 152.39 $ 124.79 $ 157.59 $ 197.02 (1) Common stock performance data is provided by S&P Global Market Intelligence.
This comparison assumes that the value of the investment in the common stock and each index was $100 on December 31, 2020 and that all dividends were reinvested. 34 Table of Contents Index 12/31/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024 12/31/2025 Essex Property Trust, Inc. $ 100.00 $ 152.40 $ 94.85 $ 115.70 $ 136.94 $ 130.12 FTSE NAREIT Equity Apartments Index $ 100.00 $ 163.61 $ 111.34 $ 117.87 $ 142.02 $ 129.86 S&P 500 Index $ 100.00 $ 128.71 $ 105.40 $ 133.10 $ 166.40 $ 196.16 (1) Common stock performance data is provided by S&P Global Market Intelligence.
As of December 31, 2024, there were no outstanding forward sale agreements, and $900.0 million of shares remained available to be sold under the 2024 ATM Program.
As of December 31, 2025, the Company had outstanding forward sale agreements with respect to 52,600 shares of common stock at an initial gross weighted average forward price of $314.06 per share, which are to be settled by September 2026, and $900.0 million of shares remained available to be sold under the 2024 ATM Program, pending the settlement of outstanding forward sale agreements.
Added
As of February 13, 2026, there were 61 holders of record of OP Units, including Essex.
Added
As of December 31, 2025, the Company had outstanding forward sale agreements with respect to 52,600 shares of common stock at an initial gross weighted average forward price of $314.06 per share, which are to be settled by September 2026. 36 Table of Contents

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

64 edited+18 added−12 removed55 unchanged
Biggest changeYear Ended December 31, 2024 2023 2022 Net income available to common stockholders $ 741,522 $ 405,825 $ 408,315 Adjustments: Depreciation and amortization 580,220 548,438 539,319 Gains not included in FFO (386,138) (59,238) (111,839) Casualty loss — 433 — Impairment loss from unconsolidated co-investments 3,726 33,700 2,105 Depreciation and amortization from unconsolidated co-investments 66,943 71,745 72,585 Noncontrolling interest related to Operating Partnership units 26,414 14,284 14,297 Depreciation attributable to third party ownership and other (1) 31,191 (1,474) (1,421) Funds from operations attributable to common stockholders and unitholders $ 1,063,878 $ 1,013,713 $ 923,361 FFO per share-diluted $ 15.99 $ 15.24 $ 13.70 Non-core items: Expensed acquisition and investment related costs $ 72 $ 595 $ 2,132 Tax (benefit) expense on unconsolidated co-investments (2) (929) 697 (10,236) Realized and unrealized (gains) losses on marketable securities, net (8,347) (10,006) 45,547 Provision for credit losses (179) 70 (381) Equity (income) loss from non-core co-investments (3) (10,344) (1,685) 38,045 Loss on early retirement of debt, net — — 2 Loss on early retirement of debt from unconsolidated co-investment — — 988 Co-investment promote income (1,531) — (17,076) Income from early redemption of preferred equity investments and notes receivable — (285) (1,669) General and administrative and other, net (4) 39,341 6,629 2,536 Insurance reimbursements, legal settlements, and other, net (5) (43,794) (9,821) (5,392) Core funds from operations attributable to common stockholders and unitholders $ 1,038,167 $ 999,907 $ 977,857 Core FFO per share-diluted $ 15.60 $ 15.03 $ 14.51 Weighted average number of shares outstanding, diluted (6) 66,533,908 66,514,456 67,374,526 (1) The Company consolidates certain co-investments.
Biggest changeHowever, 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. 46 Table of Contents The table below is a reconciliation of net income available to common stockholders to FFO and Core FFO for the periods presented ($ in thousands, except per share amounts): Year Ended December 31, 2025 2024 2023 Net income available to common stockholders $ 669,666 $ 741,522 $ 405,825 Adjustments: Depreciation and amortization 607,542 580,220 548,438 Gains not included in FFO (305,043) (386,138) (59,238) Casualty loss — — 433 Impairment loss from unconsolidated co-investments 12,634 3,726 33,700 Depreciation and amortization from unconsolidated co-investments 56,848 66,943 71,745 Noncontrolling interest related to Operating Partnership units 23,649 26,414 14,284 Depreciation attributable to third party ownership and other (160) 31,191 (1,474) Funds from operations attributable to common stockholders and unitholders $ 1,065,136 $ 1,063,878 $ 1,013,713 FFO per share-diluted $ 15.98 $ 15.99 $ 15.24 Non-core items: Expensed acquisition and investment related costs $ 25 $ 72 $ 595 Tax (benefit) expense on unconsolidated technology co-investments (2,096) (929) 697 Realized and unrealized gains on marketable securities, net (3,809) (8,347) (10,006) Provision for credit losses 26 (179) 70 Equity income from unconsolidated technology co-investments (6,552) (10,344) (1,685) Loss on early retirement of debt 762 — — Loss on early retirement of debt from unconsolidated co-investments 122 — — Co-investment promote income — (1,531) — Income from early redemption of preferred equity investments and notes receivable (70) — (285) General and administrative and other, net (1) 10,004 39,341 6,629 Insurance reimbursements, legal settlements, and other, net (2) (808) (43,794) (9,821) Core funds from operations attributable to common stockholders and unitholders $ 1,062,740 $ 1,038,167 $ 999,907 Core FFO per share-diluted $ 15.94 $ 15.60 $ 15.03 Weighted average number of shares outstanding, diluted (3) 66,669,649 66,533,908 66,514,456 (1) Includes political advocacy costs of $2.0 million, $33.3 million, and $4.1 million for the years ended December 31, 2025, 2024 and 2023, respectively.
OVERVIEW 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.
OVERVIEW Essex is a self-administered and self-managed REIT that acquires, develops, redevelops, and manages apartment home 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.
The Company expects that cash from operations and/or its lines of credit will fund such expenditures. 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.
The Company expects that cash from operations and/or its lines of credit will fund such expenditures. Development 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.
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.
The timing, source and amounts of cash flows provided by or used in financing activities and 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.
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 Company consolidates these entities because it is the primary beneficiary. Essex has no assets or liabilities other than its investment in the Operating Partnership.
(6) Assumes conversion of all outstanding OP Units into shares of the Company’s common stock and excludes DownREIT limited partnership units. 47 Table of Contents Net Operating Income Net operating income (“NOI”) and Same-Property NOI are considered by management to be important supplemental performance measures to earnings from operations included in the Company’s consolidated statements of income.
(3) Assumes conversion of all outstanding OP Units into shares of the Company’s common stock and excludes DownREIT limited partnership units. 47 Table of Contents Net Operating Income Net operating income (“NOI”) and Same-Property NOI are considered by management to be important supplemental performance measures to earnings from operations included in the Company’s consolidated statements of income.
The Company expects to fund the development and predevelopment communities 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.
The Company expects to fund the development and predevelopment communities by using a combination of some or all of the following sources: its working capital, amounts available on its lines of credit, commercial paper, construction loans, net proceeds from public and private equity and debt issuances, and proceeds from the disposition of assets, if any.
In the event that economic disruptions occur, the Company may further utilize other resources such as its cash reserves, lines of credit, or decreased investment in redevelopment activities to supplement operating cash flows.
In the event that economic disruptions occur, the Company may further utilize other resources such as its cash reserves, lines of credit, commercial paper or decreased investment in redevelopment activities to supplement operating cash flows.
The judgments regarding the existence of impairment indicators are based on monitoring investment market conditions and performance for operating properties including the net operating income for the most recent 44 Table of Contents 12 month period, monitoring estimated costs for properties under development, the Company’s ability to hold and its intent with regard to each asset, and each property’s remaining useful life.
The judgments regarding the existence of impairment indicators are based on monitoring investment market conditions and performance for operating properties including the net operating income for the most recent 12 month period, monitoring estimated costs for properties under development, the Company’s ability to hold and its intent with regard to each asset, and each property’s remaining useful life.
The Company’s apartment communities are predominately 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) By region, the Company’s operating results for 2024 and 2023 and projection for 2025 new housing supply (defined as new multifamily apartment homes and single family homes, excluding developments with fewer than 50 apartment homes as well as student, senior and 100% affordable housing) are as follows: Southern California Region : As of December 31, 2024, this region represented 44% of the Company’s consolidated operating apartment homes.
The Company’s apartment home communities are predominately 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) By region, the Company’s operating results for 2025 and 2024 and projection for 2026 new housing supply (defined as new multifamily apartment homes and single family homes, excluding developments with fewer than 50 apartment homes as well as student, senior and 100% affordable housing) are as follows: Southern California Region : As of December 31, 2025, this region represented 42% of the Company’s consolidated operating apartment homes.
GAAP do not reflect the underlying economic realities. 45 Table of Contents (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.
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.
Essex is the sole general partner of the Operating Partnership and, as of December 31, 2024, had an approximately 96.5% general partner 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.
Essex is the sole general partner of the Operating Partnership and, as of December 31, 2025, had an approximately 96.6% general partner 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.
While historically Essex has satisfied this distribution requirement by making cash distributions to its stockholders, it may choose to satisfy this requirement by making distributions of other property, including, in limited circumstances, Essex’s own stock.
While historically Essex has satisfied this distribution requirement by 41 Table of Contents making cash distributions to its stockholders, it may choose to satisfy this requirement by making distributions of other property, including, in limited circumstances, Essex’s own stock.
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 lines of credit. Derivative Activity The Company uses interest rate swaps, interest rate caps, and total return swap contracts to manage certain interest rate risks.
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 lines of credit or commercial paper. 42 Table of Contents Derivative Activity The Company uses interest rate swaps, interest rate caps, and total return swap contracts to manage certain interest rate risks.
FFO and Core FFO are not used by the Company as, nor should they be 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 used by the Company as, nor should they be 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.
As of December 31, 2024, Essex owned a 96.5% general partner interest and the limited partners owned the remaining 3.5% interest in the Operating Partnership. The liquidity of Essex is dependent on the Operating Partnership’s ability to make sufficient distributions to Essex. The primary cash requirement of Essex is its payment of dividends to its stockholders.
As of December 31, 2025, Essex owned a 96.6% general partner interest and the limited partners owned the remaining 3.4% interest in the Operating Partnership. The liquidity of Essex is dependent on the Operating Partnership’s ability to make sufficient distributions to Essex. The primary cash requirement of Essex is its payment of dividends to its stockholders.
The Company is not at material risk of not meeting the covenants in its credit agreements and is able to timely service its debt and other obligations .
The Company is not at material risk of failing to meet the covenants in its credit agreements and is able to timely service its debt and other obligations.
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 short and long-term impact of the January 2025 California wildfires, including in relation to regulation, insurance, tenant demand and other factors; occupancy rates and rental demand may be adversely affected by competition and local economic and market conditions; there may be increased interest rates, inflation, escalated operating costs and possible recessionary impacts; geopolitical tensions and regional conflicts, and the related impacts on macroeconomic conditions, including, among other things, interest rates and inflation; the terms of any refinancing may not be as favorable as the terms of existing indebtedness; the Company’s inability to maintain its investment grade credit rating with the rating agencies; the Company may be unsuccessful in the management of its relationships with its 48 Table of Contents co-investment partners; the Company may fail to achieve its business objectives; time of actual completion and/or stabilization of development and redevelopment projects; estimates of future income from an acquired property may prove to be inaccurate; 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; changes in laws or regulations and the anticipated or actual impact of future changes in laws or regulations; unexpected difficulties in leasing of future development projects; volatility in financial and securities markets; the Company’s failure to successfully operate acquired properties; unforeseen consequences from cyber-intrusion; government approvals, actions and initiatives, including the need for compliance with environmental requirements; and those further risks, special considerations, and other factors discussed in Item 1A, Risk Factors, of this Form 10-K, and those risk factors and special considerations set forth in the Company’s other filings with the SEC which may 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.
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: occupancy rates and rental demand may be adversely affected by competition and local economic and market conditions; there may be increased interest rates, inflation, escalated operating costs and possible recessionary impacts; including from tariffs imposed by the current presidential administration and the threat of such tariffs; geopolitical tensions and regional conflicts, and the related impacts on macroeconomic conditions, including, among other things, interest rates and inflation; the terms of any refinancing may not be as favorable as the terms of 48 Table of Contents existing indebtedness; the Company’s inability to maintain its investment grade credit rating with the rating agencies; the Company may be unsuccessful in the management of its relationships with its co-investment partners; the Company may fail to achieve its business objectives; time of actual completion and/or stabilization of development and redevelopment projects; including potential delays due to supply shortages related to tariffs and/or labor shortages related to deportations or threat of deportations; estimates of future income from an acquired property may prove to be inaccurate; 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; changes in laws or regulations and the anticipated or actual impact of future changes in laws or regulations; including eviction moratoria; unexpected difficulties in leasing of future development projects; volatility in financial and securities markets; the Company’s failure to successfully operate acquired properties; unforeseen consequences from cyber-intrusion; government approvals, actions and initiatives, including the need for compliance with environmental requirements; and those further risks, special considerations, and other factors discussed in Item 1A, Risk Factors, of this Form 10-K, and those risk factors and special considerations set forth in the Company’s other filings with the SEC which may 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.
Seattle Metro Region : As of December 31, 2024, this region represented 20% of the Company’s consolidated operating apartment homes. 2024 Same-Property revenues increased 2.9% in 2024 as compared to 2023.
Seattle Metro Region : As of December 31, 2025, this region represented 20% of the Company’s consolidated operating apartment homes. 2025 Same-Property revenues increased 2.8% in 2025 as compared to 2024.
In each of these regions, projected 2025 growth in new residential supply of apartment homes and single family homes is expected to be 1% or less of the total housing stock.
In each of these regions, projected 2026 growth in new residential supply of apartment homes and single family homes is expected to be less than 1% of the total housing stock.
The Company believes that cash flows generated by its operations, existing cash and cash equivalents, marketable securities balances and availability under existing lines of credit are sufficient to 41 Table of Contents meet all of its anticipated cash needs during 2025.
The Company believes that cash flows generated by its operations, existing cash and cash equivalents, marketable securities balances and availability under existing lines of credit are sufficient to meet all of its anticipated cash needs during 2026.
Such forward-looking statements include, among other things, statements regarding expected operating performance and results (including projected Same-Property revenues and expenses), qualification as a REIT under the Internal Revenue Code of 1986, as amended, property stabilizations, property acquisition and disposition activity, joint venture and co-investment activity, development and redevelopment activity and other capital expenditures, capital raising and financing activity, revenue and expense growth, financial occupancy, interest rate and other economic expectations, included projected new housing supply.
Such forward-looking statements include, among other things, statements regarding expected operating performance and results (including projected Same-Property revenues and expenses), qualification as a REIT under the Internal Revenue Code of 1986, as amended, property stabilizations, property acquisition and disposition activity, joint venture and co-investment activity, development and redevelopment activity and other capital expenditures, capital raising and financing activity, revenue and expense growth, financial occupancy, interest rate and other economic expectations, including estimated remaining and total project costs related to the Company’s development pipeline and projected new housing supply.
The Company has four total return swap contracts, with an aggregate notional amount of $220.8 million, that effectively converts $220.8 million of fixed 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 Company has five total return swap contracts, with an aggregate notional amount of $258.8 million, that effectively convert mortgage notes payable to a floating interest rate based on the Securities Industry and Financial Markets Association Municipal Swap Index (“SIFMA”) plus a spread.
Comparison of Year Ended December 31, 2023 to the Year Ended December 31, 2022 For the comparison of the years ended December 31, 2023 and December 31, 2022, refer to Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 23, 2024 under the subheading “Comparison of Year Ended December 31, 2023 to the Year Ended December 31, 2022.” Liquidity and Capital Resources The following table sets forth the Company’s cash flows for the periods presented ($ in thousands): Year Ended December 31, 2024 2023 2022 Cash flow provided by (used in): Operating activities $ 1,068,305 $ 980,064 $ 975,649 Investing activities $ (973,051) $ (145,140) $ 145,958 Financing activities $ (419,742) $ (477,271) $ (1,137,564) Essex’s business is operated primarily through the Operating Partnership.
Comparison of Year Ended December 31, 2024 to the Year Ended December 31, 2023 For the comparison of the years ended December 31, 2024 and December 31, 2023, refer to Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on February 21, 2025 under the subheading “Comparison of Year Ended December 31, 2024 to the Year Ended December 31, 2023.” Liquidity and Capital Resources The following table sets forth the Company’s cash flows for the periods presented ($ in thousands): Year Ended December 31, 2025 2024 2023 Cash flow provided by (used in): Operating activities $ 1,074,423 $ 1,068,305 $ 980,064 Investing activities $ (552,483) $ (973,051) $ (145,140) Financing activities $ (512,200) $ (419,742) $ (477,271) Essex’s business is operated primarily through the Operating Partnership.
For the year ended December 31, 2024, non-revenue generating capital expenditures averaged approximately $2,109 per apartment home.
For the year ended December 31, 2025, non-revenue generating capital expenditures averaged approximately $2,258 per apartment home.
As of December 31, 2024, Moody’s Investor Service and Standard and Poor’s (“S&P”) credit agencies rated Essex Property Trust, Inc. and Essex Portfolio, L.P. Baa1/Stable and BBB+/Stable, respectively. As of December 31, 2024, the Company had $5.2 billion of fixed rate public bonds outstanding at an average interest rate of 3.4% with maturity dates ranging from 2025 to 2050.
As of December 31, 2025, Moody’s Investor Service and S&P’s credit agencies rated Essex Property Trust, Inc. and Essex Portfolio, L.P. Baa1/Stable and BBB+/Stable, respectively. As of December 31, 2025, the Company had $5.5 billion of fixed rate public bonds outstanding at an average interest rate of 3.7% with maturity dates ranging from 2026 to 2050.
RESULTS OF OPERATIONS Comparison of Year Ended December 31, 2024 to the Year Ended December 31, 2023 The average financial occupancy for the Company’s 2024 Same-Property portfolio (stabilized properties consolidated by the Company for the years ended December 31, 2024 and 2023) was 96.1% and 96.5% for the years ended December 31, 2024 and 2023, respectively.
RESULTS OF OPERATIONS Comparison of Year Ended December 31, 2025 to the Year Ended December 31, 2024 The average financial occupancy for the Company’s 2025 Same-Property portfolio (stabilized properties consolidated by the Company for the years ended December 31, 2025 and 2024) was 96.2% for each of the years ended December 31, 2025 and 2024.
The Company’s consolidated operating communities as of December 31, 2024 and 2023 were as follows: December 31, 2024 December 31, 2023 Apartment Homes % Apartment Homes % Southern California 23,817 44 % 21,986 43 % Northern California 19,747 36 % 19,245 37 % Seattle Metro 10,899 20 % 10,341 20 % Total 54,463 100 % 51,572 100 % Co-investments, including Wesco I, Wesco III, Wesco IV, Wesco V, Wesco VI, BEX IV, and other co-investments, developments under construction, and preferred equity interest co-investment communities are not included in the table presented above for both periods.
The Company’s consolidated operating communities as of December 31, 2025 and 2024 were as follows: December 31, 2025 December 31, 2024 Apartment Homes % Apartment Homes % Southern California 23,598 42 % 23,817 44 % Northern California 21,097 38 % 19,747 36 % Seattle Metro 10,899 20 % 10,899 20 % Total 55,594 100 % 54,463 100 % 38 Table of Contents Co-investments, including Wesco I, Wesco III, Wesco IV, Wesco V, Wesco VI, BEX IV, and other co-investments, developments under construction, and preferred equity interest co-investment communities are not included in the table presented above for both periods.
Variable Interest Entities In accordance with accounting standards for consolidation of variable interest entities (“VIEs”), the Company consolidated the Operating Partnership, 18 DownREIT entities (comprising nine communities) and five co-investments as of December 31, 2024. As of December 31, 2023, the Company consolidated the Operating Partnership, 18 DownREIT entities (comprising nine communities) and six co-investments.
Variable Interest Entities In accordance with accounting standards for consolidation of variable interest entities (“VIEs”), the Company consolidated the Operating Partnership, 18 DownREIT entities (comprising ten communities) and four co-investments as of December 31, 2025. As of December 31, 2024, the Company consolidated the Operating Partnership, 18 DownREIT entities (comprising nine 44 Table of Contents communities) and five co-investments.
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 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 consolidated total assets and liabilities related to the above consolidated co-investments and DownREIT entities, net of intercompany eliminations, were $893.0 million and $319.1 million, respectively, as of December 31, 2024, and $956.7 million and $324.5 million, respectively, as of December 31, 2023.
The consolidated total assets and liabilities related to the above consolidated co-investments and DownREIT entities, net of intercompany eliminations, were $970.6 million and $242.5 million, respectively, as of December 31, 2025, and $893.0 million and $319.1 million, respectively, as of December 31, 2024.
As of December 31, 2024, there were no outstanding forward purchase agreements, and $900.0 million of shares of common stock remained available to be sold under the 2024 ATM Program. Capital Expenditures Non-revenue generating capital expenditures are improvements and upgrades that extend the useful life of the property.
As of December 31, 2025, $900.0 million of shares of common stock remained available to be sold under the 2024 ATM Program, pending the settlement of outstanding forward sale agreements. 43 Table of Contents Capital Expenditures Non-revenue generating capital expenditures are improvements and upgrades that extend the useful life of the property.
Revenues for “2024 Same-Properties” (as defined below), or “Same-Property revenues,” increased 4.0% in 2024 as compared to 2023. Northern California Region : As of December 31, 2024, this region represented 36% of the Company’s consolidated operating apartment homes. 2024 Same-Property revenues increased 2.6% in 2024 as compared to 2023.
Revenues for “2025 Same-Properties” (as defined below), or “Same-Property revenues,” increased 3.3% in 2025 as compared to 2024. Northern California Region : As of December 31, 2025, this region represented 38% of the Company’s consolidated operating apartment homes. 2025 Same-Property revenues increased 3.6% in 2025 as compared to 2024.
Noncontrolling interests in these entities were $105.1 million and $121.1 million as of December 31, 2024 and 2023, respectively. The Company’s financial risk in each VIE is limited to its equity investment in the VIE. As of December 31, 2024, the Company was not deemed to be the primary beneficiary of any other VIEs.
Noncontrolling interests in these entities were $101.2 million and $105.1 million as of December 31, 2025 and 2024, respectively. The Company’s financial risk in each VIE is limited to its equity investment in the VIE. As of December 31, 2025, the Company did not have any VIEs of which it was not the primary beneficiary.
As of December 31, 2024, the Company’s mortgage notes payable totaled $989.9 million, net of unamortized premiums and debt issuance costs, which consisted of $674.1 million in fixed rate debt at an average interest rate of 4.3% with maturity dates ranging from 2025 to 2033 and $315.8 million of variable rate debt at an average interest rate of 4.2% with maturity dates ranging from 2026 to 2046.
As of December 31, 2025, the Company’s mortgage notes payable totaled $784.3 million, net of unamortized premiums and debt issuance costs, which consisted of $526.7 million in fixed rate debt at an average interest rate of 4.7% with maturity dates ranging from 2026 to 2033 and $257.7 million of variable rate debt at an average interest rate of 3.6% with maturity dates ranging from 2027 to 2046.
The total return swaps provide fair market value protection on the mortgage notes payable to our 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 total return swaps provide fair market value protection on the mortgage notes payable to our 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 settle all five total return swaps, with $258.8 million of the outstanding debt at par.
These increases in interest expense were partially offset by regular principal payments and various debts that matured or were paid off, primarily due to the pay off of the $300.0 million of senior unsecured notes due May 1, 2023 and $400.0 million of senior unsecured notes due May 1, 2024 during and after 2023, which resulted in a decrease in interest expense of $14.3 million for 2024.
These increases to interest expense were partially offset by various debt that was paid off, matured, or due to regular principal amortization during and after 2024, primarily due to the payoff of $400.0 million of senior unsecured notes due May 1, 2024 and $500.0 million of senior unsecured notes due April 1, 2025, which resulted in a decrease in interest expense of $19.9 million in 2025.
The 2024 ATM Program replaced the 2021 ATM Program, which was terminated upon the establishment of the 2024 ATM Program. For the years ended December 31, 2024, 2023 and 2022, the Company did not sell any shares of common stock through the 2024 ATM Program nor 2021 ATM Program.
The 2024 ATM Program replaced the prior equity distribution agreement entered into in September 2021 (the “2021 ATM Program”), which was terminated upon the establishment of the 2024 ATM Program. For the years ended December 31, 2025, 2024 and 2023, the Company did not issue any shares of common stock through the 2024 ATM Program nor the 2021 ATM Program.
Please see the reconciliation of earnings from operations to NOI and Same-Property NOI, which in the table below is the NOI for stabilized properties consolidated by the Company for the periods presented ($ in thousands): Year Ended December 31, 2024 2023 2022 Earnings from operations $ 703,095 $ 584,342 $ 595,229 Adjustments: Corporate-level property management expenses 48,218 45,872 40,704 Depreciation and amortization 580,220 548,438 539,319 Management and other fees from affiliates (10,265) (11,131) (11,139) General and administrative 98,902 63,474 56,577 Expensed acquisition and investment related costs 72 595 2,132 Casualty loss — 433 — Gain on sale of real estate and land (175,583) (59,238) (94,416) NOI 1,244,659 1,172,785 1,128,406 Less: Non Same-Property NOI (96,666) (53,485) (59,321) Same-Property NOI $ 1,147,993 $ 1,119,300 $ 1,069,085 Forward-Looking Statements Certain statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and elsewhere in this Annual Report on Form 10-K 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, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding the Company’s expectations, estimates, assumptions, hopes, intentions, beliefs and strategies regarding the future.
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): Year Ended December 31, 2025 2024 2023 Earnings from operations $ 899,316 $ 703,095 $ 584,342 Adjustments: Corporate-level property management expenses 49,052 46,208 43,593 Depreciation and amortization 607,542 580,220 548,438 Management and other fees from affiliates (9,381) (10,265) (11,131) General and administrative 71,948 98,902 63,474 Expensed acquisition and investment related costs 25 72 595 Casualty loss — — 433 Gain on sale of real estate and land (299,524) (175,583) (59,238) NOI 1,318,978 1,242,649 1,170,506 Less: Non Same-Property NOI (168,608) (128,084) (83,727) Same-Property NOI $ 1,150,370 $ 1,114,565 $ 1,086,779 Forward-Looking Statements Certain statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and elsewhere in this Annual Report on Form 10-K 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, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding the Company’s expectations, estimates, assumptions, hopes, intentions, beliefs and strategies regarding the future.
As of December 31, 2024, the Company owned or had ownership interests in 255 operating apartment communities, comprising 62,157 apartment homes, excluding the Company’s ownership in preferred equity co-investments, loan investments, and two operating commercial buildings.
As of December 31, 2025, the Company owned or had ownership interests in 259 operating apartment communities, comprising 63,077 apartment homes, excluding the Company’s ownership in preferred equity co-investments, loan investments, two operating commercial buildings and a development pipeline comprised of one consolidated project and various predevelopment projects.
The increases were partially offset by the sale of Hillsdale Garden in 2024.
The increases were partially offset by the sale of Highridge, Essex Skyline, The Grand, and Fourth & U in 2025 and Hillsdale Garden in 2024.
As of December 31, 2024, the Company had $66.8 million of unrestricted cash and cash equivalents and $69.8 million in marketable securities, all of which were equity securities.
As of December 31, 2025, the Company had $76.2 million of unrestricted cash and cash equivalents and $98.1 million in marketable securities, all of which were equity securities or available for sale debt securities.
These increases were offset by a decrease of $6.5 million in income from preferred equity investments, including income from early redemption of preferred equity investments. Gain on remeasurement of co-investments of $210.6 million resulted from the Company's acquisition of its joint venture partner's interests in the BEXAEW and BEX II portfolios, Patina at Midtown and Century Towers.
Gain on remeasurement of co-investment of $0.3 million in 2025 resulted from the Company’s consolidation of its investment in Artizan. Gain on remeasurement of $210.6 million in 2024 resulted from the Company’s acquisition of its joint venture partner’s interests in the BEXAEW and BEX II portfolios, Patina at Midtown and Century Towers.
The increase was primarily due to acquisitions of Hacienda at Camarillo Oaks in 2023, as well as the acquisitions of ARLO Mountain View, Maxwell Sunnyvale, and Beaumont, and the acquisition of the Company’s joint venture partner’s interests in the BEXAEW and BEX II portfolios, Patina at Midtown, and Century Towers in 2024.
The increase was primarily due to the acquisitions of The Plaza, One Hundred Grand, ROEN Menlo Park, Revere Campbell, The Parc at Pruneyard, ViO, 1250 Lakeside, and the consolidation of Artizan and TENTEN Downtown in 2025, as well as ARLO Mountain View, Maxwell Sunnyvale, and Beaumont, along with the Company’s acquisition of its joint venture partner’s interests in the BEXAEW and BEX II portfolios, Patina at Midtown, and Century Towers in 2024.
Gain on sale of real estate and land of $175.6 million in 2024 was attributable to the sale of Hillsdale Garden in 2024.
Gain on sale of real estate and land increased to $299.5 million in 2025 compared to $175.6 million in 2024. The increase was primarily attributable to the dispositions of Highridge, Essex Skyline, The Grand and Fourth & U in 2025 compared to the disposition of Hillsdale Garden in 2024.
The underlying interest rate on the $75.0 million line is based on a tiered rate structure tied to the Company’s credit ratings, adjusted for the Company’s sustainability metric adjustment feature, and was at the Adjusted SOFR plus 0.765% as of December 31, 2024. This facility is scheduled to mature in July 2026.
As of December 31, 2025, there was no amount outstanding on the Company’s $75.0 million working capital unsecured line of credit. The underlying interest rate on the $75.0 million line is based on a tiered rate structure tied to the Company’s credit ratings and was at Adjusted SOFR plus 0.775% as of December 31, 2025.
The aggregate carrying and fair value of the total return swaps was zero at both December 31, 2024 and 2023. 42 Table of Contents As of December 31, 2024 and 2023 the aggregate carrying value of the interest rate swap contracts are an asset of $5.5 million and $4.3 million, respectively, and is included in prepaid expenses and other assets in the consolidated balance sheets.
As of December 31, 2025 and 2024 the aggregate carrying value of the interest rate swap contracts is an asset of $2.0 million and $5.5 million, respectively, and is included in prepaid expenses and other assets in the consolidated balance sheets. The Company had no interest rate cap agreements as of December 31, 2025 and 2024, respectively.
As of December 31, 2024, the Company’s development and predevelopment pipeline was comprised of various consolidated predevelopment projects, with total incurred costs of $52.7 million.
As of December 31, 2025, the Company’s development pipeline was comprised of one consolidated development project and various predevelopment projects, with total incurred costs of $157.1 million, and estimated remaining project costs of approximately $200.9 million, for total estimated project costs of $358.0 million.
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 as an indicator of the Company’s ability to fund its cash needs. 45 Table of Contents 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.
Additionally, there was a $0.6 million decrease in capitalized interest in 2024, due to a decrease in development activity as compared to the same period in 2023.
Additionally, there 40 Table of Contents was an increase in capitalized interest of $3.4 million in 2025 due to an increase in development activity as compared to the same period in 2024.
The increase was primarily attributable to increases of 1.9% in average rental rates from $2,605 for 2023 to $2,655 for 2024, 0.8% in other property income, and 0.9% from a decrease in delinquencies, partially offset by a decrease of 0.4% in occupancy. 2024 Non-Same Property Revenues increased by $54.4 million or 74.3% to $127.7 million in 2024 compared to $73.3 million in 2023.
The increase was primarily attributable to an increase of 2.3% in average rental rates from $2,638 for 2024 to $2,699 for 2025 and 0.5% from a decrease in delinquencies. 2025 Non-Same Property Revenues increased by $61.2 million or 35.2% to $235.0 million in 2025 compared to $173.8 million in 2024.
The Company’s unsecured lines of credit and unsecured debt agreements contain debt covenants related to limitations on indebtedness and liabilities and maintenance of minimum levels of consolidated earnings before depreciation, interest and amortization. The Company was in compliance with the debt covenants as of December 31, 2024 and 2023. The Company pays quarterly dividends from cash available for distribution.
The Company has used and expects to continue to use the proceeds from the Notes for general corporate purposes and working capital purposes. The Company’s unsecured lines of credit and unsecured debt agreements contain debt covenants related to limitations on indebtedness and liabilities and maintenance of minimum levels of consolidated earnings before depreciation, interest and amortization.
Real estate taxes increased by $7.6 million or 4.1% to $193.4 million in 2024 compared to $185.8 million in 2023, primarily due to increases in tax rates in California and the Seattle Metro region and due to the purchase of Hacienda at Camarillo Oaks in 2023 and acquisitions in 2024. 2024 Same-Property real estate taxes increased by $3.4 million or 1.9% to $179.8 million in 2024 compared to $176.4 million in 2023 primarily due to increases in tax rates in California and the Seattle Metro region.
Real estate taxes increased by $12.2 million or 6.3% to $205.6 million in 2025 compared to $193.4 million in 2024, primarily due to the net impact of acquisitions and dispositions in 2024 and 2025 identified in the Non-Same Property revenues section above. 2025 Same-Property real estate taxes increased by $0.4 million or 0.3% to $176.1 million in 2025 compared to $175.7 million in 2024 primarily due to increases in tax rates in California, partially offset by decreases in both assessed values and tax rates in the Seattle Metro region for 2025.
The regional breakdown of the Company’s 2024 Same-Property portfolio for financial occupancy for the years ended December 31, 2024 and 2023 was as follows: Year Ended December 31, 2024 2023 Southern California 95.8 % 96.3 % Northern California 96.3 % 96.5 % Seattle Metro 96.7 % 96.6 % 39 Table of Contents The following table provides a breakdown of property revenue amounts, including the revenues attributable to 2024 Same-Properties ($ in thousands): Number of Apartment Homes Year Ended December 31, Dollar Change Percentage Change 2024 2023 2024 Same-Properties: Southern California 21,573 $ 697,394 $ 670,475 $ 26,919 4.0 % Northern California 18,273 648,843 632,440 16,403 2.6 % Seattle Metro 10,341 290,294 282,092 8,202 2.9 % Total 2024 Same-Property Revenues 50,187 1,636,531 1,585,007 51,524 3.3 % 2024 Non-Same Property Revenues 127,654 73,257 54,397 74.3 % Total Property Revenues $ 1,764,185 $ 1,658,264 $ 105,921 6.4 % 2024 Same-Property Revenues increased by $51.5 million or 3.3%.
The regional breakdown of the Company’s 2025 Same-Property portfolio for financial occupancy for the years ended December 31, 2025 and 2024 was as follows: Year Ended December 31, 2025 2024 Southern California 95.9 % 95.8 % Northern California 96.5 % 96.3 % Seattle Metro 96.2 % 96.7 % The following table provides a breakdown of rental and other property revenues, including the revenues attributable to 2025 Same-Properties ($ in thousands): 39 Table of Contents Number of Apartment Homes Year Ended December 31, Dollar Change Percentage Change 2025 2024 2025 Same-Properties: Southern California 20,654 $ 679,826 $ 658,315 $ 21,511 3.3 % Northern California 18,037 664,800 641,795 23,005 3.6 % Seattle Metro 10,341 298,363 290,294 8,069 2.8 % Total 2025 Same-Property 49,032 1,642,989 1,590,404 52,585 3.3 % 2025 Non-Same Property 234,975 173,781 61,194 35.2 % Total rental and other property revenues $ 1,877,964 $ 1,764,185 $ 113,779 6.4 % 2025 Same-Property Revenues increased by $52.6 million or 3.3%.
Alternative Capital Sources The Company utilizes co-investments as an alternative source of capital for acquisitions of both operating and development communities.
Alternative Capital Sources The Company utilizes co-investments as an alternative source of capital for acquisitions of both operating and development communities. The Company had an interest in 7,483 apartment homes in operating communities with joint ventures and technology co-investments for a total book value of $304.4 million as of December 31, 2025.
The long-term impact of these developments will largely depend on the impact on job growth, the broader economy, and reactions by consumers, companies, governmental entities and capital markets.
The long-term impact of these developments on our company will largely depend on the impact on broader trends in job growth, inflation, the economy, and reactions by consumers, companies, governmental entities and capital market participants. The foregoing macroeconomic conditions have not negatively impacted the Company’s ability to access traditional funding sources which have been historically available to it.
As of December 31, 2024, the Company had two unsecured lines of credit aggregating $1.28 billion, including a $1.2 billion unsecured line of credit and a $75.0 million working capital unsecured line of credit. As of December 31, 2024, there was $75.0 million outstanding on the $1.2 billion unsecured line of credit.
A total of $258.8 million of variable rate debt is tax-exempt demand notes which are subject to total return swaps. As of December 31, 2025, the Company had two unsecured lines of credit aggregating $1.58 billion, including a $1.5 billion unsecured line of credit and a $75.0 million working capital unsecured line of credit.
Interest expense increased by $22.6 million or 10.6% to $235.5 million in 2024 compared to $212.9 million in 2023 , primarily due to the issuance of $550.0 million senior unsecured notes in 2024 which resulted in an increase in interest expense of $20.1 million.
Interest expense increased by $22.9 million or 9.7% to $258.4 million in 2025 compared to $235.5 million in 2024 , primarily due to the issuance in March 2024 and August 2024 of $550.0 million senior unsecured notes due April 2034, the issuance in February 2025 of $400.0 million senior unsecured notes due April 2035, borrowing on the new $300.0 million unsecured term loan in June and September 2025, and increased borrowing on the two unsecured lines of credit and the commercial paper program which resulted in an increase in interest expense of $46.2 million in 2025.
Property operating expenses, excluding real estate taxes increased by $26.4 million or 8.8% to $326.1 million in 2024 compared to $299.7 million in 2023, primarily due to increases of $10.6 million in utilities expenses, $7.8 million in administrative expenses, $7.3 million in personnel costs, and $0.7 million in maintenance and repairs expenses. 2024 Same-Property operating expenses, excluding real estate taxes, increased by $19.5 million or 6.7% to $308.8 million in 2024 compared to $289.3 million in 2023, primarily due to increases of $7.5 million in utilities expenses, $6.9 million in insurance and other expenses, $4.5 million in personnel costs, and $1.3 million in administrative expenses, offset by a decrease of $0.7 million in maintenance and repairs expenses.
Property operating expenses, excluding real estate taxes increased by $25.3 million or 7.7% to $353.4 million in 2025 compared to $328.1 million in 2024, primarily due to acquisitions in 2024 and 2025 identified in the Non-Same Property revenues section above and the increase of Same-Property operating expenses discussed below, partially offset by dispositions in 2024 and 2025. 2025 Same-Property operating expenses, excluding real estate taxes, increased by $16.4 million or 5.5% to $316.5 million in 2025 compared to $300.1 million in 2024, primarily due to increases of $8.1 million in utilities expenses resulting from increases in trash removal, water and sewer costs, $3.7 million in personnel costs due to wage inflation, and $2.6 million in maintenance and repairs expenses due to increases in water damage remediation costs.
Depreciation and amortization expense increased by $31.8 million or 5.8% to $580.2 million in 2024 compared to $548.4 million in 2023, primarily due to acquisitions in 2023 and 2024. These increases were offset by the sale of CBC and The Sweeps in 2023 and Hillsdale Garden in 2024.
Depreciation and amortization expense increased by $27.3 million or 4.7% to $607.5 million in 2025 compared to $580.2 million in 2024, primarily due to acquisitions in 2024 and 2025 identified in the Non-Same Property revenues section above. The increase was partially offset by dispositions in 2024 and 2025.
As of December 31, 2024, the Company had an interest in 7,694 apartment homes in operating communities with joint ventures and technology co-investments for a total book value of $379.5 million. 43 Table of Contents Real Estate and Other Commitments The following table summarizes the Company’s unfunded real estate and other future commitments as of December 31, 2024 ($ in thousands): Number of Properties Investment Remaining Commitment Joint ventures : Preferred equity investments 1 $ 85,000 $ 35,000 Non-core co-investments — 86,000 34,465 $ 171,000 $ 69,465 As of December 31, 2024, the Company had operating lease commitments of $125.1 million for ground, building and garage leases with maturity dates ranging from 2025 to 2083. $6.4 million of these commitments are due within the next twelve months.
Real Estate and Other Commitments The following table summarizes the Company’s unfunded real estate and other future commitments as of December 31, 2025 ($ in thousands): Number of Properties Investment Remaining Unfunded Commitment Joint ventures: Preferred equity investments 1 $ 85,000 $ 35,000 Technology co-investments N/A 86,000 23,215 Consolidated: Real estate under development 1 157,122 200,883 $ 328,122 $ 259,098 As of December 31, 2025, the Company had remaining unfunded commitments of $94.8 million for operating co-investments.
The underlying interest rate is based on a tiered rate structure tied to the Company’s credit ratings, adjusted for the Company’s sustainability metric adjustment feature, and was at the Adjusted SOFR plus 0.765% as of December 31, 2024. This facility is scheduled to mature in January 2029, with two six-month extensions, exercisable at the Company’s option.
As of December 31, 2025, there was no amount outstanding on the $1.5 billion unsecured line of credit. The underlying interest rate is based on a tiered rate structure tied to the Company’s long-term unsecured credit ratings and was at SOFR plus 0.775% as of December 31, 2025.
The Company can currently call all four of the total return swaps, with $220.8 million of the outstanding debt at par. These derivatives do not qualify for hedge accounting.
These derivatives do not qualify for hedge accounting. The aggregate carrying and fair value of the total return swaps was zero at both December 31, 2025 and 2024.
Interest and other income increased by $34.7 million or 74.9% to $81.0 million in 2024 compared to $46.3 million in 2023, primarily due to increases of $34.8 million in legal settlements and $1.3 million in interest income, offset by a decrease of $1.7 million in realized and unrealized gains on marketable securities. 40 Table of Contents Equity income from co-investments increased by $37.6 million or 354.7% to $48.2 million in 2024 compared to $10.6 million in 2023, primarily due to a decrease of $30.0 million in impairment losses from unconsolidated co-investments, increases of $8.7 million in equity income from non-core co-investments, $1.5 million in co-investment promote income, and a decrease of $4.8 million in equity loss from co-investments.
Equity income from co-investments decreased by $12.7 million or 26.3% to $35.5 million in 2025 compared to $48.2 million in 2024, primarily due to $12.6 million of impairment losses from unconsolidated co-investments in 2025 compared to $3.7 million in 2024.
Removed
The communities previously held in the BEXAEW, BEX II, Patina at Midtown, and Century 38 Table of Contents Towers co-investments, which were consolidated in 2024, are excluded from the table as December 31, 2023 but included in the table as of December 31, 2024.
Added
Market Considerations Domestic and international policy actions, including tariff and trade policy, as well as continuing geopolitical tensions and regional conflicts have the potential to trigger broad market uncertainty.
Removed
Market Considerations Elevated inflation in recent years has caused an increase in consumer prices, thereby reducing purchasing power and elevating the risks of a recession. In response to increased inflation, the U.S. Federal Reserve raised the federal funds rate throughout 2022 and 2023 resulting in a significant increase of market interest rates. In the second half of 2024, the U.S.
Added
General and administrative expense decreased by $27.0 million or 27.3% to $71.9 million in 2025 compared to $98.9 million in 2024, primarily due to a decrease of $31.3 million in political advocacy costs, partially offset by an increase of $5.8 million in personnel costs due to wage inflation.
Removed
Federal Reserve lowered the federal funds rate in conjunction with the softening of U.S. inflation and short term market interest rates have declined. Concurrently, geopolitical tensions and regional conflicts have increased uncertainty during recent years.
Added
Interest and other income decreased by $61.0 million or 75.3% to $20.0 million in 2025 compared to $81.0 million in 2024, primarily due to a decrease of $42.9 million in gains from legal settlements. During the first quarter of 2024, the Company settled two lawsuits related to construction defects at two communities and received cash recoveries of $42.5 million.
Removed
The foregoing macroeconomic conditions have not negatively impacted the Company’s ability to access traditional funding sources on the same or reasonably similar terms as were available in recent periods prior to the pandemic, as demonstrated by the Company’s financing activity during the year ended December 31, 2024 discussed in the “Liquidity and Capital Resources” section below.
Added
The Company determined that all uncertainties were resolved upon receipt of cash and recorded a gain. There were no material gains from legal settlements during 2025.
Removed
The increase was also due to borrowing on the $300.0 million unsecured term loan in April 2023, the $298.0 million of 10-year secured loans closed in July 2023, and increased borrowing on the Company’s unsecured lines of credit in 2024 resulting in a $16.2 million increase in interest expense.
Added
Additionally, there was a decrease of $9.8 million in income from preferred equity investments due to a lower average outstanding investment balance in 2025 compared to 2024. The overall decrease was offset by a $5.2 million gain recognized on the sale of a co-investment community during 2025 with no prior year equivalent.
Removed
A total of $220.8 million of variable rate debt is tax-exempt demand notes which are subject to total return swaps and $95.0 million of variable rate mortgage notes payable has an interest rate swap that effectively converts $47.5 million to an all-in fixed rate of 2.83%.
Added
This facility is scheduled to mature in January 2030, with two six-month extensions, exercisable at the Company’s option. The Company may elect to increase the facility by up to an additional $1.0 billion, to an aggregate size of $2.5 billion, if the lenders permit.
Removed
As of December 31, 2024, there was $62.9 million outstanding on the Company’s $75.0 million working capital unsecured line of credit.
Added
This facility is scheduled to mature in July 2026. As of December 31, 2025, the Company had an unsecured commercial paper program (the “Commercial Paper Program”) to issue unsecured commercial paper notes with varying maturities up to 397 days from the date of issue (the “Notes”).
Removed
The Company had no interest rate cap agreements as of December 31, 2024 and 2023, respectively. Hedge ineffectiveness related to cash flow hedges, which is reported in current year income as interest expense, net was zero for the years ended December 31, 2024, 2023 and 2022.
Added
As of December 31, 2025, there was no amount of Notes outstanding under the Commercial Paper Program. Amounts available under the Commercial Paper Program may be borrowed, repaid and re-borrowed from time to time, with the maximum aggregate face or principal amount outstanding at any one time not exceeding $750.0 million.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

9 edited+1 added−1 removed5 unchanged
Biggest changeNotional Amount Maturity Date Carrying and Estimated Fair Value Estimated Carrying Value +50 -50 Basis Points Basis Points Cash flow hedges: Interest rate swaps $ 347,500 2026 $ 5,467 $ 8,185 $ 2,732 Total cash flow hedges $ 347,500 2026 $ 5,467 $ 8,185 $ 2.732 Additionally, the Company has entered into total return swap contracts, with an aggregate notional amount of $220.8 million that effectively convert $220.8 million of fixed mortgage notes payable to a floating interest rate based on the SIFMA plus a spread and have a carrying value of zero as of December 31, 2024.
Biggest changeThe table also includes a sensitivity analysis to demonstrate the impact on the Company’s derivative instruments from an increase or decrease in 10-year Treasury bill interest rates by 50 basis points, as of December 31, 2025 ($ in thousands): Notional Amount Maturity Date Carrying and Estimated Fair Value Estimated Carrying Value +50 -50 Basis Points Basis Points Cash flow hedges: Interest rate swaps $ 497,500 2026-2030 $ 1,270 $ 5,293 $ (2,820) Forward starting interest rate swap 150,000 2030 703 3,521 (2,169) Total cash flow hedges $ 647,500 2026-2030 $ 1,973 $ 8,814 $ (4,989) Additionally, the Company has entered into total return swap contracts, with an aggregate notional amount of $258.8 million that effectively convert $258.8 million of fixed mortgage notes payable to a floating interest rate based on the SIFMA plus a spread and had a carrying value of zero as of December 31, 2025.
The table incorporates only those exposures that exist as of December 31, 2024. 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 8.
The table incorporates only those exposures that exist as of December 31, 2025. 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 8.
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.
Interest Rate Sensitive Liabilities The Company is exposed to interest rate changes primarily as a result of its lines of credit, commercial paper, 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 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 December 31, 2024.
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 December 31, 2025.
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.
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.
As of December 31, 2024, the Company had two interest rate swap contracts to mitigate the risk of changes in the interest-related cash outflows on the Company’s $300.0 million unsecured term loan and $47.5 million of variable rate mortgage notes payable. The Company’s interest rate swap was designated as a cash flow hedge as of December 31, 2024.
As of December 31, 2025, the Company had five interest rate swap contracts and two forward starting interest rate swap contracts to mitigate the risk of changes in the interest-related cash outflows on the Company’s $600.0 million unsecured term loan. The Company’s interest rate swap was designated as a cash flow hedge as of December 31, 2025.
Management has estimated the fair value of the Company’s $754.7 million of variable rate debt as of December 31, 2024, to be $749.4 million 49 Table of Contents based on the terms of existing mortgage notes payable and variable rate demand notes compared to those available in the marketplace.
Management has estimated the fair value of the Company’s $858.8 million of variable rate debt as of December 31, 2025, to be $853.2 million based on the terms of existing mortgage notes payable and variable rate demand notes compared to those available in the marketplace.
The following table represents scheduled principal payments ($ in thousands): Year Ended December 31, 2025 2026 2027 2028 2029 Thereafter Total Fair value Fixed rate debt $ 643,035 $ 548,291 $ 419,558 $ 517,000 $ 500,000 $ 3,248,000 $ 5,875,884 $ 5,489,008 Average interest rate 3.5 % 3.5 % 3.8 % 2.2 % 4.1 % 3.5 % Variable rate debt (1) $ 1,019 $ 159,059 $ 384,397 $ 1,332 $ 76,456 $ 132,481 $ 754,744 $ 749,386 Average interest rate 4.2 % 4.9 % 4.1 % 4.2 % 5.7 % 4.2 % (1) $220.8 million of variable rate debt is tax exempt to the note holders.
The following table represents scheduled principal payments ($ in thousands): Year Ended December 31, 2026 2027 2028 2029 2030 Thereafter Total Fair value Fixed rate debt $ 548,291 $ 350,000 $ 517,000 $ 500,000 $ 615,000 $ 3,448,000 $ 5,978,291 $ 5,767,386 Average interest rate 3.5 % 3.8 % 2.2 % 4.1 % 3.4 % 4.0 % Variable rate debt (1) $ 1,114 $ 84,397 $ 1,332 $ 1,456 $ 301,592 $ 468,889 $ 858,780 $ 853,192 Average interest rate 3.7 % 3.5 % 3.7 % 3.7 % 4.0 % 4.0 % (1) $258.8 million of variable rate debt is tax exempt to the note holders.
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. Management has estimated the fair value of the Company’s $5.9 billion of fixed rate debt as of December 31, 2024, to be $5.5 billion.
The Company does not enter into derivative or interest rate transactions for speculative purposes. 49 Table of Contents The Company’s interest rate risk is monitored using a variety of techniques. The table below presents the principal amounts and weighted average interest rates by year of expected maturity to evaluate the expected cash flows.
Removed
The table also includes a sensitivity analysis to demonstrate the impact on the Company’s derivative instruments from an increase or decrease in 10-year Treasury bill interest rates by 50 basis points, as of December 31, 2024 ($ in thousands).
Added
Management has estimated the fair value of the Company’s $6.0 billion of fixed rate debt as of December 31, 2025, to be $5.8 billion.

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