ESSEX PORTFOLIO LP

Previous wording

As of March 31, 2025, the Company owned or had ownership interests in 258 operating apartment communities, comprising 62,772 apartment homes, excluding the Company’s ownership in preferred equity co-investments, loan investments, two operating commercial buildings, a development pipeline comprised of one consolidated project and various predevelopment projects.

Current wording

As of June 30, 2025, the Company owned or had ownership interests in 259 operating apartment communities, comprising 62,842 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.

Previous wording

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 communities previously held in the BEXAEW, BEX II, Patina at Midtown, and Century Towers co-investments, which were consolidated in 2024, are excluded from the table as of March 31, 2024 but included in the table as of March 31, 2025.

Current wording

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 communities previously held in the BEX II, Patina at Midtown, and Century Towers co-investments, which were consolidated in 2024, are excluded from the table as of June 30, 2024 but included in the table as of June 30, 2025.

Previous wording

Recently, domestic policy actions, including tariff discussions, as well as continuing geopolitical tensions and regional conflicts have increased uncertainty. The long-term impact of these developments on our company will largely depend on the impact on job growth, inflation, the broader economy, and reactions by consumers, companies, governmental entities and capital markets.

Current wording

Domestic and international policy actions, including tariff and trade policy, as well as continuing geopolitical tensions and regional conflicts have the potential to trigger market uncertainty. 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 markets.

Previous wording

The average financial occupancy for the Company’s 2025 Same-Property portfolio (stabilized properties consolidated by the Company for the quarters ended March 31, 2025 and 2024) was 96.3% for both the three months ended March 31, 2025 and 2024. Financial occupancy is defined as the percentage resulting from dividing actual rental income by total scheduled rental income. Actual rental income represents contractual rental income pursuant to leases without considering delinquency and concessions. Total scheduled rental income represents the value of all apartment homes, with occupied apartment homes valued at contractual rental rates pursuant to leases and vacant apartment homes valued at estimated market rents. The Company believes that financial occupancy is a meaningful measure of occupancy because it considers the value of each vacant apartment home at its estimated market rate.

Current wording

The average financial occupancy for the Company’s 2025 Same-Property portfolio (stabilized properties consolidated by the Company for the quarters ended June 30, 2025 and 2024) was 96.2% for both the three months ended June 30, 2025 and 2024. Financial occupancy is defined as the percentage resulting from dividing actual rental income by total scheduled rental income. Actual rental income represents contractual rental income pursuant to leases without considering delinquency and concessions. Total scheduled rental income represents the value of all apartment homes, with occupied apartment homes valued at contractual rental rates pursuant to leases and vacant apartment homes valued at estimated market rents. The Company believes that financial occupancy is a meaningful measure of occupancy because it considers the value of each vacant apartment home at its estimated market rate.

Previous wording

Same-Property Revenues increased by $13.6 million or 3.4% to $409.1 million for the first quarter of 2025 from $395.6 million for the first quarter of 2024. The increase was primarily attributable to an increase of 2.1% in average rental rates from $2,612 per apartment home for the first quarter of 2024 to $2,667 per apartment home for the first quarter of 2025. Additionally, 0.7% of the increase is attributable to a decrease in delinquencies and 0.2% of the increase is attributable to a decrease in cash concessions for the first quarter of 2025 compared to the first quarter of 2024.

Current wording

Same-Property Revenues increased by $12.7 million or 3.2% to $410.9 million for the second quarter of 2025 from $398.3 million for the second quarter of 2024. The increase was primarily attributable to an increase of 2.4% in average rental rates from $2,628 per apartment home for the second quarter of 2024 to $2,690 per apartment home for the second quarter of 2025. Additionally, 0.5% of the increase is attributable to a decrease in delinquencies for the second quarter of 2025 compared to the second quarter of 2024.

Previous wording

Non-Same Property Revenues increased by $24.3 million or 84.9% to $52.9 million in the first quarter of 2025 from $28.6 million in the first quarter of 2024. The increase was primarily due to the acquisitions of The Plaza, One Hundred Grand, ROEN Menlo Park and the consolidation of Artizan 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. The increases were partially offset by the sale of Highridge in 2025 and Hillsdale Garden in 2024.

Current wording

Non-Same Property Revenues increased by $15.2 million or 36.6% to $56.7 million in the second quarter of 2025 from $41.5 million in the second quarter of 2024. The increase was primarily due to the acquisitions of The Plaza, One Hundred Grand, ROEN Menlo Park, Revere Campbell, The Parc at Pruneyard, and the consolidation of Artizan in 2025, as well as ARLO Mountain View and Beaumont, along with the Company’s acquisition of its joint venture partner’s interests in the BEX II portfolio, Patina at Midtown, and Century Towers in 2024. The increases were partially offset by the sale of Highridge and Essex Skyline in 2025 and Hillsdale Garden in 2024.

Previous wording

Property operating expenses, excluding real estate taxes increased by $6.4 million or 8.0% to $86.0 million for the first quarter of 2025 compared to $79.6 million for the first quarter of 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. Same-Property operating expenses, excluding real estate taxes, increased by $2.3 million or 3.0% to $78.0 million in the first quarter of 2025 compared to $75.7 million in the first quarter of 2024, primarily due to an increase of $1.6 million in utilities expenses resulting from increases in trash removal, water and sewer costs.

Current wording

Property operating expenses, excluding real estate taxes increased by $7.2 million or 9.1% to $86.4 million for the second quarter of 2025 compared to $79.2 million for the second quarter of 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. Same-Property operating expenses, excluding real estate taxes, increased by $5.0 million or 6.9% to $77.9 million in the second quarter of 2025 compared to $72.9 million in the second quarter of 2024, primarily due to increases of $2.3 million in utilities expenses resulting from increases in trash removal, water and sewer costs, $1.8 million in maintenance and repairs expenses due to increases in landscaping and general property maintenance expenses, and $1.3 million in personnel costs due to wage inflation.

Previous wording

Real estate taxes increased by $5.7 million or 12.2% to $52.6 million for the first quarter of 2025 compared to $46.9 million for the first quarter of 2024, primarily due to acquisitions in 2024 and 2025 identified in the non-same property revenues section above and estimated 2025 increases in real estate taxes in California and the Seattle Metro region. Same-Property real estate taxes increased by $2.2 million or 5.0% to $46.3 million for the first quarter of 2025 compared to $44.1 million for the first quarter of 2024 primarily due to estimated increases in real estate taxes in California and the Seattle Metro region for 2025.

Current wording

Real estate taxes increased by $1.7 million or 3.6% to $49.0 million for the second quarter of 2025 compared to $47.3 million for the second quarter of 2024, primarily due to acquisitions in 2024 and 2025 identified in the Non-Same Property revenues section above and an estimated 2025 net aggregate increase in combined real estate taxes in California and the Seattle Metro region. Same-Property real estate taxes decreased by $1.6 million or 3.7% to $42.2 million for the second quarter of 2025 compared to $43.8 million for the second quarter of 2024 primarily due to decreases in both assessed values and tax rates in the Seattle Metro region.

Previous wording

Depreciation and amortization expense increased by $11.6 million or 8.3% to $151.3 million for the first quarter of 2025 compared to $139.7 million for the first quarter of 2024, primarily due to acquisitions in 2025 and 2024 identified in the non-same property revenues section above. The increase was partially offset by dispositions in 2025 and 2024.

Current wording

Depreciation and amortization expense increased by $5.9 million or 4.1% to $151.5 million for the second quarter of 2025 compared to $145.6 million for the second quarter of 2024, primarily due to acquisitions in 2025 and 2024 identified in the Non-Same Property revenues section above. The increase was partially offset by dispositions in 2025 and 2024.

Previous wording

Gain on sale of real estate and landof $111.0 million was attributable to the disposition of Highridge.

Current wording

Gain on sale of real estate and landof $126.2 million was attributable to the disposition of Essex Skyline.

Previous wording

Interest expense increased by $6.8 million or 12.2% to $62.7 million for the first quarter of 2025 compared to $55.9 million for the first quarter of 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, and increased borrowing during the quarter on the two unsecured lines of credit which resulted in an increase in interest expense of $11.9 million for the first quarter of 2025. These increases to interest expense were partially offset by various debt that was paid off, matured, or regular principal amortization during and after the first quarter of 2024, but primarily due to the payoff of $400.0 million of senior unsecured notes due May 1, 2024, which resulted in a decrease in interest expense of $4.4 million for the first quarter of 2025. Additionally, there was a $0.7 million increase in capitalized interest in the first quarter of 2025, due to an increase in development activity as compared to the same period in 2024.

Current wording

Interest expense increased by $6.2 million or 10.5% to $65.3 million for the second quarter of 2025 compared to $59.1 million for the second quarter of 2024, primarily due to the upsizing in August 2024 of $550.0 million senior unsecured notes due April 2034, $95.0 million of assumed secured loans in October 2024, 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 2025, and increased borrowing during the quarter on the two unsecured lines of credit and commercial paper program which resulted in an increase in interest expense of $13.5 million for the second quarter of 2025. These increases to interest expense were partially offset by various debt that was paid off, matured, or regular principal amortization during and after the second quarter of 2024, but 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 $6.7 million for the second quarter of 2025. Additionally, there was an increase in capitalized interest of $0.6 million in the second quarter of 2025, due to an increase in development activity as compared to the same period in 2024.

Previous wording

Interest and other income decreased by $53.0 million or 92.5% to $4.3 million for the first quarter of 2025 compared to $57.3 million for the first quarter of 2024, primarily due to a decrease of $42.4 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. 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 the first quarter of 2025.

Current wording

Interest and other income decreased by $55.7 million or 83.4% to $11.1 million in income for the six months ended June 30, 2025 compared to $66.8 million for the six months ended June 30, 2024, primarily due to a decrease of $42.6 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. 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 the six months ended June 30, 2025.

Previous wording

Equity income from co-investments increased by $0.8 million or 6.5% to $13.2 million for the first quarter of 2025 compared to $12.4 million for the first quarter of 2024, primarily due to a $3.7 million impairment loss on one of the Company’s preferred equity investments incurred during the first quarter of 2024, with no current year equivalent and reduced equity loss from the Company’s operating co-investments. These increases were offset by $1.5 million of promote income recognized from the closing of the BEXAEW portfolio acquisition during the first quarter of 2024, with no current year equivalent and a decrease in unrealized and realized gains from non-core co-investments.

Current wording

Equity income from co-investments increased by $0.2 million or 0.9% to $22.2 million for the six months ended June 30, 2025 compared to $22.0 million for the six months ended June 30, 2024, primarily due to decreases of $4.1 million in unrealized and realized gains from unconsolidated technology co-investments, $3.2 million in income from preferred equity investments due to fewer outstanding investments at June 30, 2025 compared to the same period in 2024, and $1.5 million of promote income recognized from the closing of the BEXAEW portfolio acquisition during the first quarter of 2024, with no current year equivalent. These decreases were offset by a $3.7 million impairment loss on one of the Company’s preferred equity investments incurred during the first quarter of 2024, with no current year equivalent, and reduced equity loss from the Company’s operating co-investments.

Previous wording

As of March 31, 2025, the Company had $98.7 million of unrestricted cash and cash equivalents and $76.0 million in marketable securities, all of which were equity securities or available for sale debt securities. The Company believes that cash flows generated by its operations, existing cash and cash equivalents, marketable securities balances and availability under existing lines of credit are sufficient to meet all of its anticipated cash needs during the next twelve months. Additionally, the capital markets continue to be available and the Company is able to generate cash from the disposition of real estate assets to finance additional cash flow needs, including continued development and select acquisitions. 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. 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.

Current wording

As of June 30, 2025, the Company had $58.7 million of unrestricted cash and cash equivalents and $82.2 million in marketable securities, all of which were equity securities or available for sale debt securities. The Company believes that cash flows generated by its operations, existing cash and cash equivalents, marketable securities balances and availability under existing lines of credit are sufficient to meet all of its anticipated cash needs during the next twelve months. Additionally, the capital markets continue to be available and the Company is able to generate cash from the disposition of real estate assets to finance additional cash flow needs, including continued development and select acquisitions. 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 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.

Previous wording

As of March 31, 2025, the Company had two unsecured lines of credit aggregating $1.28 billion. As of March 31, 2025, there was no outstanding balance on the Company’s $1.2 billion unsecured line of credit. The underlying interest rate is based on a tiered rate structure tied to the Company’s credit ratings, adjusted for the Company’s sustainability metric adjustment feature, and was at the Adjusted SOFR plus 0.765% as of March 31, 2025. This facility is scheduled to mature in January 2029, with two six-month extensions, exercisable at the Company’s option. As of March 31, 2025, there was no outstanding balance 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, adjusted for the Company’s sustainability metric adjustment feature, and was at the Adjusted SOFR plus 0.765% as of March 31, 2025. This facility is scheduled to mature in July 2026.

Current wording

As of June 30, 2025, the Company had two unsecured lines of credit aggregating $1.28 billion. As of June 30, 2025, there was no outstanding balance on the Company’s $1.2 billion unsecured line of credit. The underlying interest rate is based on a tiered rate structure tied to the Company’s credit ratings, adjusted for the Company’s sustainability metric adjustment feature, and was at the Adjusted SOFR plus 0.765% as of June 30, 2025. This facility was scheduled to mature in January 2029, with two six-month extensions, exercisable at the Company’s option. In July 2025, the Company amended its revolving credit facility increasing the maximum borrowing capacity to $1.5 billion and extended its maturity date to January 2030 with two 6-month extension options, 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. The underlying interest rate on this new line of credit facility is SOFR plus 0.775% which is based on a tiered rate structure tied to the Company's long-term unsecured credit ratings. As of June 30, 2025, there was no outstanding balance 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, adjusted for the Company’s sustainability metric adjustment feature, and was at the Adjusted SOFR plus 0.765% as of June 30, 2025. This facility is scheduled to mature in July 2026.

Previous wording

During the three months ended March 31, 2025, the Company did not sell any shares of its common stock through the 2024 ATM Program.

Current wording

During the six months ended June 30, 2025, the Company did not issue any shares of its common stock through the 2024 ATM Program.

Previous wording

During the three months ended March 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 is to be settled by September 2026.

Current wording

During the six months ended June 30, 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 is to be settled by September 2026.

Previous wording

In September 2022, the Company announced that its Board of Directors approved a new 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 three months ended March 31, 2025, the Company did not repurchase any shares and as of March 31, 2025, the Company had $302.7 million of purchase authority remaining under its $500.0 million stock repurchase plan.

Current wording

In September 2022, the Company announced that its Board of Directors approved a new 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 six months ended June 30, 2025, the Company did not repurchase any shares and as of June 30, 2025, the Company had $302.7 million of purchase authority remaining under its $500.0 million stock repurchase plan.

Previous wording

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

Current wording

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

Previous wording

As of March 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 $96.3 million, and estimated remaining project costs of approximately $258.7 million, for total estimated project costs of $355.0 million.

Current wording

As of June 30, 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 $105.6 million, and estimated remaining project costs of approximately $250.0 million, for total estimated project costs of $356.0 million.

Previous wording

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.

Current wording

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.

Previous wording

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 7,694 apartment homes in operating communities with joint ventures and technology co-investments for a total book value of $369.3 million as of March 31, 2025.

Current wording

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 7,694 apartment homes in operating communities with joint ventures and technology co-investments for a total book value of $360.9 million as of June 30, 2025.

Previous wording

(4)Includes political advocacy costs of $0.1 million and $1.9 million for the three months ended March 31, 2025 and 2024, respectively.

Current wording

(1)Includes political advocacy costs of $0.3 million and $0.4 million for the three and six months ended June 30, 2025, respectively, and $5.3 million and $7.2 million for the three and six months ended June 30, 2024, respectively.

Previous wording

(5)During the three months ended March 31, 2024, the Company settled two lawsuits related to construction defects at two communities and received cash recoveries of $42.5 million. The Company determined that all uncertainties were resolved upon receipt of cash and recorded a gain which was excluded from Core FFO. There were no material gains from legal settlements during the three months ended March 31, 2025.

Current wording

(2)There were no material gains from legal settlements during the three and six months ended June 30, 2025 and the three months ended June 30, 2024. During the six months ended June 30, 2024, the Company settled two lawsuits related to construction defects at two communities and received cash recoveries of $42.5 million. The Company determined that all uncertainties were resolved upon receipt of cash and recorded a gain which was excluded from Core FFO.

Previous wording

(6)Assumes conversion of all outstanding limited partnership units in the Operating Partnership into shares of the Company’s common stock and excludes DownREIT limited partnership units.

Current wording

(3)Assumes conversion of all outstanding limited partnership units in the Operating Partnership into shares of the Company’s common stock and excludes DownREIT limited partnership units.