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Equity Residential Reports First Quarter 2024 Results

Same Store Results Ahead of Expectations

Equity Residential (NYSE: EQR) today reported results for the quarter ended March 31, 2024.

First Quarter 2024 Results

All per share results are reported as available to common shares/units on a diluted basis.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended March 31,

 

 

 

 

 

2024

 

 

2023

 

 

$ Change

 

 

% Change

 

 

 

Earnings Per Share (EPS)

 

$

0.77

 

 

$

0.56

 

 

$

0.21

 

 

 

37.5

%

 

 

Funds from Operations (FFO) per share

 

$

0.87

 

 

$

0.85

 

 

$

0.02

 

 

 

2.4

%

 

 

Normalized FFO (NFFO) per share

 

$

0.93

 

 

$

0.87

 

 

$

0.06

 

 

 

6.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Recent Highlights

  • Same store revenue increased 4.1% for the first quarter of 2024 compared to the first quarter of 2023, driven by healthy demand and modest supply across most of our markets. Same store expense increased 1.3% with low or negative growth in our primary expense categories. The Company's continued focus on expense efficiency has delivered a five-year compounded annual growth rate of same store expenses of 3.1%. Same store Net Operating Income (NOI) increased 5.5%.
  • Our focus on same store revenue growth, same store expense and corporate overhead efficiency and limited exposure to higher interest rates led to strong growth.
  • Our high quality customer experience along with the overall desirability of our locations has led to the lowest quarterly same store Turnover in our history of 8.6%.
  • During the first quarter of 2024, the Company sold three properties - one in Boston, one in Orange County and one in San Francisco - consisting of 504 apartment units, for an aggregate sale price of approximately $248.5 million.
  • During the first quarter of 2024, the Company repurchased and retired 652,452 of its common shares, at a weighted average purchase price of $58.95 per share, for an aggregate purchased amount of approximately $38.5 million.

“Our operating business performed very well this quarter positioning us favorably as we enter our primary leasing season,” said Mark J. Parrell, Equity Residential’s President and CEO. “The positive demand dynamics in our affluent renter demographic, limited new apartment supply in our existing predominantly coastal markets and our laser focus on expense management continue to produce good results.”

Results Per Share

The change in EPS for the quarter ended March 31, 2024 compared to the same period of 2023 is due primarily to higher property sale gains, the various adjustment items listed on page 25 of this release and the items described below.

The per share change in FFO for the quarter ended March 31, 2024 compared to the same period of 2023 is due primarily to the various adjustment items listed on page 25 of this release and the items described below.

The per share change in Normalized FFO is due primarily to:

 

 

Positive/(Negative) Impact

 

 

 

First Quarter 2024 vs.

First Quarter 2023

 

Same store NOI

 

$

0.07

 

2024 and 2023 transaction activity impact on NOI, net

 

(0.01

)

Corporate overhead (1)

 

 

(0.01

)

Other items

 

 

0.01

 

Net

 

$

0.06

 

(1)

Corporate overhead includes property management and general and administrative expenses.

The Company has a glossary of defined terms and related reconciliations of Non-GAAP financial measures on pages 27 through 33 of this release. Reconciliations and definitions of FFO and Normalized FFO are provided on pages 6, 29 and 30 of this release.

Same Store Results

The following table shows the total same store results for the periods presented (includes Residential and Non-Residential).

 

 

First Quarter 2024 vs.

First Quarter 2023

 

First Quarter 2024 vs.

Fourth Quarter 2023

Apartment Units

 

77,373

 

77,950

Physical Occupancy

 

96.3% vs. 95.9%

 

96.3% vs. 95.8%

 

 

 

 

 

Revenues (1)

 

4.1%

 

1.1%

Expenses

 

1.3%

 

6.5%

NOI

 

5.5%

 

(1.3%)

(1)

See page 10 for further discussion.

The following table reflects the detail of the change in Same Store Residential Revenues, which is presented on a GAAP basis showing Leasing Concessions on a straight-line basis.

 

 

First Quarter 2024 vs.

First Quarter 2023

 

 

First Quarter 2024 vs.

Fourth Quarter 2023

 

 

 

% Change

 

 

% Change

 

Same Store Residential Revenues-

 

 

 

 

 

comparable period

Lease rates

 

 

2.9

%

 

 

0.1

%

Leasing Concessions

 

 

(0.3

%)

 

 

0.0

%

Vacancy gain (loss)

 

 

0.4

%

 

 

0.6

%

Bad Debt, Net (1)

 

 

0.3

%

 

 

0.0

%

Other (2)

 

 

0.6

%

 

 

(0.1

%)

Same Store Residential Revenues-

current period

 

3.9

%

 

 

0.6

%

(1)

Change in rental income due to bad debt write-offs and reserves, net of amounts (including governmental rental assistance payments) collected on previously written-off or reserved accounts. See page 12 for more detail.

(2) Includes ancillary income, utility recoveries, early lease termination income, miscellaneous income and other items.

See page 11 for detail and reconciliations of Same Store Residential Revenues on a GAAP basis to Same Store Residential Revenues with Leasing Concessions on a cash basis.

Residential Same Store Operating Statistics

The following table includes select operating metrics for Residential Same Store Properties (for 77,373 same store apartment units):

 

 

April 2024 (1)

 

Q1 2024

 

Q4 2023

Physical Occupancy

 

96.4%

 

96.3%

 

95.8%

Percentage of Residents Renewing by quarter/month

61.0%

 

61.1%

 

59.1%

 

 

 

 

 

 

 

New Lease Change

 

0.1%

 

(2.2%)

 

(4.6%)

Renewal Rate Achieved

 

5.1%

 

4.7%

 

5.1%

Blended Rate

 

3.1%

 

1.6%

 

0.7%

(1)

April 2024 results are preliminary as of April 18th.

Investment Activity

The Company did not acquire any operating properties during the first quarter of 2024. During the first quarter of 2024, the Company sold three properties - one in Boston, one in Orange County and one in suburban San Francisco - consisting of 504 apartment units, for an aggregate sale price of approximately $248.5 million at a weighted average Disposition Yield of 5.5%, generating an Unlevered IRR of 13.1%. The average age of the properties sold in the first quarter of 2024 was approximately 40 years.

During the first quarter of 2024, the Company began construction on The Basin, a 440 apartment unit property located in suburban Boston with a Total Budgeted Capital Cost of $232.2 million.

Capital Markets Activity

During the first quarter of 2024, the Company repurchased and retired 652,452 of its common shares, at a weighted average purchase price of $58.95 per share, for an aggregate purchased amount of approximately $38.5 million. Combined with the Company’s fourth quarter 2023 repurchase activity, the Company has repurchased approximately $87.5 million of its common shares at a weighted average purchase price of $57.72 per share.

Second Quarter 2024 Guidance

At this time the Company is not revising its annual operating, EPS, FFO per share or Normalized FFO per share guidance provided as part of its fourth quarter 2023 earnings release. See page 26.

The Company has established guidance ranges for the second quarter of 2024 EPS, FFO per share and Normalized FFO per share as listed below:

 

 

Q2 2024

Guidance

EPS

 

$0.45 to $0.49

FFO per share

 

$0.91 to $0.95

Normalized FFO per share

 

$0.92 to $0.96

The difference between the first quarter of 2024 actual EPS of $0.77 and the second quarter of 2024 EPS guidance midpoint of $0.47 is due primarily to higher expected same store NOI, lower expected property sale gains and lower expected other expenses.

The difference between the first quarter of 2024 actual FFO of $0.87 per share and the second quarter of 2024 FFO guidance midpoint of $0.93 per share is due primarily to higher expected same store NOI and lower expected other expenses.

The difference between the first quarter of 2024 actual Normalized FFO of $0.93 per share and the second quarter of 2024 Normalized FFO guidance midpoint of $0.94 per share is due primarily to higher expected same store NOI.

About Equity Residential

Equity Residential is committed to creating communities where people thrive. The Company, a member of the S&P 500, is focused on the acquisition, development and management of residential properties located in and around dynamic cities that attract affluent long-term renters. Equity Residential owns or has investments in 299 properties consisting of 79,688 apartment units, with an established presence in Boston, New York, Washington, D.C., Seattle, San Francisco and Southern California, and an expanding presence in Denver, Atlanta, Dallas/Ft. Worth and Austin. For more information on Equity Residential, please visit our website at www.equityapartments.com.

Forward-Looking Statements

In addition to historical information, this press release contains forward-looking statements and information within the meaning of the federal securities laws. These statements are based on current expectations, estimates, projections and assumptions made by management. While Equity Residential’s management believes the assumptions underlying its forward-looking statements are reasonable, such information is inherently subject to uncertainties and may involve certain risks, including, without limitation, changes in general market conditions, including the rate of job growth and cost of labor and construction material, the level of new multifamily construction and development, government regulations and competition. These and other risks and uncertainties are described under the heading “Risk Factors” in our Annual Report on Form 10-K and subsequent periodic reports filed with the Securities and Exchange Commission (SEC) and available on our website, www.equityapartments.com. Many of these uncertainties and risks are difficult to predict and beyond management’s control. Forward-looking statements are not guarantees of future performance, results or events. Equity Residential assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.

A live web cast of the Company’s conference call discussing these results will take place tomorrow, Wednesday, April 24, 2024 at 10:00 a.m. CT. Please visit the Investor section of the Company’s website at www.equityapartments.com for the webcast link.

Equity Residential

Consolidated Statements of Operations

(Amounts in thousands except per share data)

(Unaudited)

 

 

 

Quarter Ended March 31,

 

 

2024

 

2023

REVENUES

 

 

 

 

 

 

Rental income

 

$

730,818

 

 

$

705,088

 

 

 

 

 

 

 

 

EXPENSES

 

 

 

 

 

 

Property and maintenance

 

 

134,630

 

 

 

137,579

 

Real estate taxes and insurance

 

 

108,927

 

 

 

106,669

 

Property management

 

 

35,458

 

 

 

31,466

 

General and administrative

 

 

15,720

 

 

 

16,165

 

Depreciation

 

 

225,695

 

 

 

215,830

 

Total expenses

 

 

520,430

 

 

 

507,709

 

 

 

 

 

 

 

 

Net gain (loss) on sales of real estate properties

 

 

188,185

 

 

 

100,209

 

Interest and other income

 

 

9,329

 

 

 

1,538

 

Other expenses

 

 

(31,738

)

 

 

(8,995

)

Interest:

 

 

 

 

 

 

Expense incurred, net

 

 

(67,212

)

 

 

(66,401

)

Amortization of deferred financing costs

 

 

(1,918

)

 

 

(1,979

)

Income before income and other taxes, income (loss) from

investments in unconsolidated entities and net gain (loss)

on sales of land parcels

 

 

307,034

 

 

 

221,751

 

Income and other tax (expense) benefit

 

 

(304

)

 

 

(298

)

Income (loss) from investments in unconsolidated entities

 

 

(1,698

)

 

 

(1,382

)

Net income

 

 

305,032

 

 

 

220,071

 

Net (income) loss attributable to Noncontrolling Interests:

 

 

 

 

 

 

Operating Partnership

 

 

(8,275

)

 

 

(7,059

)

Partially Owned Properties

 

 

(970

)

 

 

(977

)

Net income attributable to controlling interests

 

 

295,787

 

 

 

212,035

 

Preferred distributions

 

 

(547

)

 

 

(772

)

Premium on redemption of Preferred Shares

 

 

(1,444

)

 

 

 

Net income available to Common Shares

 

$

293,796

 

 

$

211,263

 

 

 

 

 

 

 

 

Earnings per share – basic:

 

 

 

 

 

 

Net income available to Common Shares

 

$

0.78

 

 

$

0.56

 

Weighted average Common Shares outstanding

 

 

378,812

 

 

 

378,341

 

 

 

 

 

 

 

 

Earnings per share – diluted:

 

 

 

 

 

 

Net income available to Common Shares

 

$

0.77

 

 

$

0.56

 

Weighted average Common Shares outstanding

 

 

390,561

 

 

 

390,664

 

 

 

 

 

 

 

 

Distributions declared per Common Share outstanding

 

$

0.675

 

 

$

0.6625

 

Equity Residential

Consolidated Statements of Funds From Operations and Normalized Funds From Operations

(Amounts in thousands except per share and Unit data)

(Unaudited)

 

 

 

Quarter Ended March 31,

 

 

2024

 

2023

Net income

 

$

305,032

 

 

$

220,071

 

Net (income) loss attributable to Noncontrolling Interests – Partially

Owned Properties

 

(970

)

 

 

(977

)

Preferred distributions

 

 

(547

)

 

 

(772

)

Premium on redemption of Preferred Shares

 

 

(1,444

)

 

 

 

Net income available to Common Shares and Units

 

 

302,071

 

 

 

218,322

 

 

 

 

 

 

 

 

Adjustments:

 

 

 

 

 

 

Depreciation

 

 

225,695

 

 

 

215,830

 

Depreciation – Non-real estate additions

 

 

(955

)

 

 

(1,156

)

Depreciation – Partially Owned Properties

 

 

(542

)

 

 

(545

)

Depreciation – Unconsolidated Properties

 

 

335

 

 

 

632

 

Net (gain) loss on sales of real estate properties

 

 

(188,185

)

 

 

(100,209

)

FFO available to Common Shares and Units

 

 

338,419

 

 

 

332,874

 

 

 

 

 

 

 

 

Adjustments (see note for additional detail):

 

 

 

 

 

 

Write-off of pursuit costs

 

 

548

 

 

 

1,332

 

Debt extinguishment and preferred share redemption (gains)

losses

 

 

1,444

 

 

 

 

Non-operating asset (gains) losses

 

 

(6,106

)

 

 

714

 

Other miscellaneous items

 

 

30,591

 

 

 

6,292

 

Normalized FFO available to Common Shares and Units

 

$

364,896

 

 

$

341,212

 

 

 

 

 

 

 

 

FFO

 

$

340,410

 

 

$

333,646

 

Preferred distributions

 

 

(547

)

 

 

(772

)

Premium on redemption of Preferred Shares

 

 

(1,444

)

 

 

 

FFO available to Common Shares and Units

 

$

338,419

 

 

$

332,874

 

FFO per share and Unit – basic

 

$

0.87

 

 

$

0.85

 

FFO per share and Unit – diluted

 

$

0.87

 

 

$

0.85

 

 

 

 

 

 

 

 

Normalized FFO

 

$

365,443

 

 

$

341,984

 

Preferred distributions

 

 

(547

)

 

 

(772

)

Normalized FFO available to Common Shares and Units

 

$

364,896

 

 

$

341,212

 

Normalized FFO per share and Unit – basic

 

$

0.94

 

 

$

0.88

 

Normalized FFO per share and Unit – diluted

 

$

0.93

 

 

$

0.87

 

 

 

 

 

 

 

 

Weighted average Common Shares and Units outstanding – basic

 

 

389,481

 

 

 

389,851

 

Weighted average Common Shares and Units outstanding – diluted

 

390,561

 

 

 

390,664

 

Note: See Adjustments from FFO to Normalized FFO for additional detail regarding the adjustments from FFO to Normalized FFO. See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for the definitions of non-GAAP financial measures and other terms as well as the reconciliations of EPS to FFO per share and Normalized FFO per share.

Equity Residential

Consolidated Balance Sheets

(Amounts in thousands except for share amounts)

(Unaudited)

 

 

 

March 31,

 

December 31,

 

 

2024

 

2023

ASSETS

 

 

 

 

 

 

Land

 

$

5,550,882

 

 

$

5,581,876

 

Depreciable property

 

 

22,930,036

 

 

 

22,938,426

 

Projects under development

 

 

155,729

 

 

 

78,036

 

Land held for development

 

 

64,466

 

 

 

114,300

 

Investment in real estate

 

 

28,701,113

 

 

 

28,712,638

 

Accumulated depreciation

 

 

(9,978,012

)

 

 

(9,810,337

)

Investment in real estate, net

 

 

18,723,101

 

 

 

18,902,301

 

Investments in unconsolidated entities1

 

 

289,272

 

 

 

282,049

 

Cash and cash equivalents

 

 

44,535

 

 

 

50,743

 

Restricted deposits

 

 

152,025

 

 

 

89,252

 

Right-of-use assets

 

 

454,035

 

 

 

457,266

 

Other assets

 

 

231,829

 

 

 

252,953

 

Total assets

 

$

19,894,797

 

 

$

20,034,564

 

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

Mortgage notes payable, net

 

$

1,633,870

 

 

$

1,632,902

 

Notes, net

 

 

5,349,938

 

 

 

5,348,417

 

Line of credit and commercial paper

 

 

225,921

 

 

 

409,131

 

Accounts payable and accrued expenses

 

 

146,072

 

 

 

87,377

 

Accrued interest payable

 

 

49,190

 

 

 

65,716

 

Lease liabilities

 

 

310,422

 

 

 

311,640

 

Other liabilities

 

 

274,919

 

 

 

272,596

 

Security deposits

 

 

68,818

 

 

 

69,178

 

Distributions payable

 

 

263,615

 

 

 

259,231

 

Total liabilities

 

 

8,322,765

 

 

 

8,456,188

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

Redeemable Noncontrolling Interests – Operating Partnership

 

 

298,219

 

 

 

289,248

 

Equity:

 

 

 

 

 

 

Shareholders' equity:

 

 

 

 

 

 

Preferred Shares of beneficial interest, $0.01 par value;

100,000,000 shares authorized; 343,100 shares issued and

outstanding as of March 31, 2024 and 745,600 shares issued

and outstanding as of December 31, 2023

 

 

17,155

 

 

 

37,280

 

Common Shares of beneficial interest, $0.01 par value;

1,000,000,000 shares authorized; 378,939,751 shares issued

and outstanding as of March 31, 2024 and 379,291,417

shares issued and outstanding as of December 31, 2023

 

 

3,789

 

 

 

3,793

 

Paid in capital

 

 

9,603,743

 

 

 

9,601,866

 

Retained earnings

 

 

1,436,671

 

 

 

1,437,185

 

Accumulated other comprehensive income (loss)

 

 

6,314

 

 

 

5,704

 

Total shareholders’ equity

 

 

11,067,672

 

 

 

11,085,828

 

Noncontrolling Interests:

 

 

 

 

 

 

Operating Partnership

 

 

207,272

 

 

 

202,306

 

Partially Owned Properties

 

 

(1,131

)

 

 

994

 

Total Noncontrolling Interests

 

 

206,141

 

 

 

203,300

 

Total equity

 

 

11,273,813

 

 

 

11,289,128

 

Total liabilities and equity

 

$

19,894,797

 

 

$

20,034,564

 

1 Includes $227.3 million and $220.2 million in unconsolidated development projects as of March 31, 2024 and December 31, 2023, respectively. See Development and Lease-Up Projects for additional detail on unconsolidated projects.

Equity Residential

Portfolio Summary

As of March 31, 2024

 

 

 

 

 

 

 

 

% of

Stabilized

 

 

Average

 

 

 

 

 

 

Apartment

 

 

Budgeted

 

 

Rental

 

Markets/Metro Areas

 

Properties

 

 

Units

 

 

NOI

 

 

Rate

 

Established Markets:

 

 

 

 

 

 

 

 

 

 

 

 

Los Angeles

 

 

58

 

 

 

14,732

 

 

 

17.3

%

 

$

2,925

 

Orange County

 

 

12

 

 

 

3,718

 

 

 

5.0

%

 

 

2,900

 

San Diego

 

 

12

 

 

 

2,878

 

 

 

4.1

%

 

 

3,103

 

Subtotal – Southern California

 

 

82

 

 

 

21,328

 

 

 

26.4

%

 

 

2,945

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Washington, D.C.

 

 

48

 

 

 

15,028

 

 

 

16.4

%

 

 

2,666

 

San Francisco

 

 

42

 

 

 

11,567

 

 

 

15.3

%

 

 

3,282

 

New York

 

 

34

 

 

 

8,536

 

 

 

14.2

%

 

 

4,592

 

Boston

 

 

26

 

 

 

7,077

 

 

 

11.7

%

 

 

3,557

 

Seattle

 

 

44

 

 

 

9,267

 

 

 

10.5

%

 

 

2,569

 

Subtotal – Established Markets

 

 

276

 

 

 

72,803

 

 

 

94.5

%

 

 

3,146

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expansion Markets:

 

 

 

 

 

 

 

 

 

 

 

 

Denver

 

 

9

 

 

 

2,792

 

 

 

2.8

%

 

 

2,409

 

Atlanta

 

 

7

 

 

 

2,111

 

 

 

1.6

%

 

 

2,049

 

Dallas/Ft. Worth

 

 

4

 

 

 

1,241

 

 

 

0.7

%

 

 

1,905

 

Austin

 

 

3

 

 

 

741

 

 

 

0.4

%

 

 

1,842

 

Subtotal – Expansion Markets

 

 

23

 

 

 

6,885

 

 

 

5.5

%

 

 

2,148

 

Total

 

 

299

 

 

 

79,688

 

 

 

100.0

%

 

$

3,061

 

 

 

 

Properties

 

Apartment Units

Wholly Owned Properties

 

285

 

76,628

Partially Owned Properties – Consolidated

 

14

 

3,060

 

 

299

 

79,688

Note: Projects under development are not included in the Portfolio Summary until construction has been completed.

Equity Residential

Portfolio Rollforward Q1 2024

($ in thousands)

 

 

 

Properties

 

Apartment

Units

 

Sales Price

 

Disposition

Yield

12/31/2023

 

 

302

 

 

 

80,191

 

 

 

 

 

 

 

Dispositions:

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated Rental Properties

 

 

(3

)

 

 

(504

)

 

$

(248,500

)

 

 

(5.5

%)

 

 

 

 

 

 

 

 

 

 

 

 

 

Configuration Changes

 

 

 

 

 

1

 

 

 

 

 

 

 

3/31/2024

 

 

299

 

 

 

79,688

 

 

 

 

 

 

 

 

Equity Residential

First Quarter 2024 vs. First Quarter 2023

Same Store Results/Statistics Including 77,373 Same Store Apartment Units

(includes Residential and Non-Residential)

($ in thousands except for Average Rental Rate)

 

 

 

Results

 

Statistics

Description

 

Revenues

 

Expenses

 

NOI

 

Average

Rental

Rate

 

Physical

Occupancy

 

Turnover

Q1 2024

 

$

716,665

 

 

$

231,905

 

 

$

484,760

 

 

$

3,077

 

 

 

96.3

%

 

 

8.6

%

Q1 2023

 

$

688,303

 

 

$

228,961

 

 

$

459,342

 

 

$

2,975

 

 

 

95.9

%

 

 

9.1

%

Change

 

$

28,362

 

 

$

2,944

 

 

$

25,418

 

 

$

102

 

 

 

0.4

%

 

 

(0.5

%)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change

 

 

4.1

%

(1)

 

1.3

%

 

 

5.5

%

 

 

3.4

%

 

 

 

 

 

 

 

First Quarter 2024 vs. Fourth Quarter 2023

Same Store Results/Statistics Including 77,950 Same Store Apartment Units

(includes Residential and Non-Residential)

($ in thousands except for Average Rental Rate)

 

 

 

Results

 

Statistics

Description

 

Revenues

 

Expenses

 

NOI

 

Average

Rental

Rate

 

Physical

Occupancy

 

Turnover

Q1 2024

 

$

720,261

 

 

$

233,087

 

 

$

487,174

 

 

$

3,070

 

 

 

96.3

%

 

 

8.6

%

Q4 2023

 

$

712,383

 

 

$

218,881

 

 

$

493,502

 

 

$

3,067

 

 

 

95.8

%

 

 

9.5

%

Change

 

$

7,878

 

 

$

14,206

 

 

$

(6,328

)

 

$

3

 

 

 

0.5

%

 

 

(0.9

%)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change

 

 

1.1

%

(1)

 

6.5

%

 

 

(1.3

%)

 

 

0.1

%

 

 

 

 

 

 

(1)

Non-Residential contributed 0.20% and 0.50% to quarterly and sequential same store revenue growth, respectively, primarily due to improved collectibility expectations for certain Non-Residential tenants, resulting in the reinstatement of their respective straight-line receivable balances in the first quarter of 2024. The Company contemplated these contributions in its previous 2024 annual guidance.

Equity Residential

Same Store Residential Revenues – GAAP to Cash Basis (1)

($ in thousands)

 

 

First Quarter 2024 vs. First Quarter 2023

 

First Quarter 2024 vs. Fourth Quarter 2023

 

77,373 Same Store Apartment Units

 

77,950 Same Store Apartment Units

 

Q1 2024

 

Q1 2023

 

Q1 2024

 

Q4 2023

Same Store Residential Revenues (GAAP Basis)

$

687,139

 

 

$

661,626

 

 

$

690,735

 

 

$

686,778

 

Leasing Concessions amortized

 

5,076

 

 

 

2,801

 

 

 

5,093

 

 

 

4,810

 

Leasing Concessions granted (2)

 

(4,951

)

 

 

(4,167

)

 

 

(4,955

)

 

 

(5,392

)

Same Store Residential Revenues with Leasing

Concessions on a cash basis

$

687,264

 

 

$

660,260

 

 

$

690,873

 

 

$

686,196

 

 

 

 

 

 

 

 

 

 

 

 

 

% change - GAAP revenue

 

3.9

%

 

 

 

 

 

0.6

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

% change - cash revenue

 

4.1

%

 

 

 

 

 

0.7

%

 

 

 

(1)

See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for additional detail.

(2)

Concession usage is primarily concentrated in Los Angeles, San Francisco and Seattle.

Same Store Net Operating Income By Quarter

Including 77,373 Same Store Apartment Units

(includes Residential and Non-Residential)

($ in thousands)

 

 

 

Q1 2024

 

Q4 2023

 

Q3 2023

 

Q2 2023

 

Q1 2023

Same store revenues

 

$

716,665

 

 

$

708,665

 

 

$

704,606

 

 

$

700,114

 

 

$

688,303

 

Same store expenses

 

 

231,905

 

 

 

217,880

 

 

 

223,739

 

 

 

219,571

 

 

 

228,961

 

Same store NOI

 

$

484,760

 

 

$

490,785

 

 

$

480,867

 

 

$

480,543

 

 

$

459,342

 

Equity Residential

Same Store Residential Accounts Receivable Balances

Including 77,373 Same Store Apartment Units

($ in thousands)

 

Balance Sheet (Other assets):

 

March 31, 2024

 

December 31, 2023

 

March 31, 2023

Residential accounts receivable balances

 

$

18,290

 

 

$

21,021

 

 

$

32,210

 

Allowance for doubtful accounts

 

 

(13,204

)

 

 

(15,485

)

 

 

(28,237

)

Net receivable balances

$

5,086

 

 

$

5,536

 

 

$

3,973

 

 

 

 

 

 

 

 

 

 

 

Straight-line receivable balances

 

$

8,337

 

(1)

$

8,461

 

 

$

5,702

 

(1)

Total same store Residential Leasing Concessions granted in the first quarter of 2024 were approximately $5.0 million. The straight-line receivable balance of $8.3 million reflects Residential Leasing Concessions that the Company expects will be primarily recognized as a reduction of rental revenues in the remainder of 2024 and the first quarter of 2025.

Same Store Residential Bad Debt

Including 77,373 Same Store Apartment Units

($ in thousands)

 

Income Statement (Rental income):

 

Q1 2024

 

Q4 2023

 

Q1 2023

Bad debts before governmental rental assistance

 

$

9,187

 

 

$

9,325

 

 

$

11,896

 

Governmental rental assistance received

 

(379

)

 

 

(379

)

 

 

(1,161

)

Bad Debt, Net

 

$

8,808

 

 

$

8,946

 

 

$

10,735

 

 

 

 

 

 

 

 

 

 

 

Bad Debt, Net as a % of Same Store Residential Revenues

 

1.3

%

 

 

1.3

%

 

 

1.6

%

Equity Residential

First Quarter 2024 vs. First Quarter 2023

Same Store Residential Results/Statistics by Market

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Increase (Decrease) from Prior Year's Quarter

Markets/Metro Areas

 

Apartment

Units

 

Q1 2024

% of

Actual

NOI

 

Q1 2024

Average

Rental

Rate

 

Q1 2024

Weighted

Average

Physical

Occupancy %

 

Q1 2024

Turnover

 

Revenues

 

Expenses

 

NOI

 

Average

Rental

Rate

 

Physical

Occupancy

 

Turnover

Los Angeles

 

 

14,135

 

 

 

17.5

%

 

$

2,922

 

 

 

95.5

%

 

 

9.6

%

 

 

5.2

%

 

 

1.5

%

 

 

7.0

%

 

 

5.2

%

 

 

0.0

%

 

 

(0.4

%)

Orange County

 

 

3,718

 

 

 

5.2

%

 

 

2,900

 

 

 

96.1

%

 

 

7.4

%

 

 

5.9

%

 

 

3.5

%

 

 

6.6

%

 

 

5.9

%

 

 

(0.1

%)

 

 

(0.1

%)

San Diego

 

 

2,878

 

 

 

4.3

%

 

 

3,103

 

 

 

96.1

%

 

 

8.0

%

 

 

6.5

%

 

 

1.1

%

 

 

8.2

%

 

 

5.7

%

 

 

0.7

%

 

 

(1.7

%)

Subtotal – Southern California

 

20,731

 

 

 

27.0

%

 

 

2,943

 

 

 

95.7

%

 

 

9.0

%

 

 

5.5

%

 

 

1.7

%

 

 

7.1

%

 

 

5.4

%

 

 

0.1

%

 

 

(0.5

%)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Washington, D.C.

 

 

14,716

 

 

 

16.9

%

 

 

2,665

 

 

 

97.1

%

 

 

7.0

%

 

 

5.5

%

 

 

(1.9

%)

 

 

9.4

%

 

 

5.0

%

 

 

0.5

%

 

 

(0.4

%)

San Francisco

 

 

11,345

 

 

 

15.8

%

 

 

3,281

 

 

 

96.4

%

 

 

9.5

%

 

 

2.0

%

 

 

2.3

%

 

 

1.9

%

 

 

1.2

%

 

 

0.7

%

 

 

0.1

%

New York

 

 

8,536

 

 

 

14.1

%

 

 

4,592

 

 

 

97.0

%

 

 

6.5

%

 

 

3.9

%

 

 

3.2

%

 

 

4.5

%

 

 

3.7

%

 

 

0.2

%

 

 

(1.0

%)

Boston

 

 

7,077

 

 

 

11.0

%

 

 

3,557

 

 

 

95.7

%

 

 

7.4

%

 

 

4.8

%

 

 

(2.2

%)

 

 

8.0

%

 

 

4.6

%

 

 

0.2

%

 

 

(0.6

%)

Seattle

 

 

9,266

 

 

 

10.4

%

 

 

2,569

 

 

 

96.1

%

 

 

9.7

%

 

 

0.4

%

 

 

5.0

%

 

 

(1.4

%)

 

 

(0.6

%)

 

 

1.0

%

 

 

(1.4

%)

Denver

 

 

2,505

 

 

 

2.6

%

 

 

2,415

 

 

 

96.3

%

 

 

10.1

%

 

 

1.3

%

 

 

(0.5

%)

 

 

2.1

%

 

 

1.6

%

 

 

0.0

%

 

 

(1.0

%)

Other Expansion Markets

 

 

3,197

 

 

 

2.2

%

 

 

1,973

 

 

 

95.5

%

 

 

13.3

%

 

 

0.9

%

 

 

(4.2

%)

 

 

5.3

%

 

 

0.1

%

 

 

0.6

%

 

 

0.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

77,373

 

 

 

100.0

%

 

$

3,077

 

 

 

96.3

%

 

 

8.6

%

 

 

3.9

%

 

 

1.2

%

 

 

5.2

%

 

 

3.4

%

 

 

0.4

%

 

 

(0.5

%)

 

Note: The above table reflects Residential same store results only. Residential operations account for approximately 96.0% of total revenues for the quarter ended March 31, 2024.

Equity Residential

First Quarter 2024 vs. Fourth Quarter 2023

Same Store Residential Results/Statistics by Market

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Increase (Decrease) from Prior Quarter

Markets/Metro Areas

 

Apartment

Units

 

Q1 2024

% of

Actual

NOI

 

Q1 2024

Average

Rental

Rate

 

Q1 2024

Weighted

Average

Physical

Occupancy %

 

Q1 2024

Turnover

 

Revenues

 

Expenses

 

NOI

 

Average

Rental

Rate

 

Physical

Occupancy

 

Turnover

Los Angeles

 

 

14,135

 

 

 

17.3

%

 

$

2,922

 

 

 

95.5

%

 

 

9.6

%

 

 

0.9

%

 

 

8.0

%

 

 

(2.2

%)

 

 

0.4

%

 

 

0.4

%

 

 

(1.3

%)

Orange County

 

 

3,718

 

 

 

5.2

%

 

 

2,900

 

 

 

96.1

%

 

 

7.4

%

 

 

0.2

%

 

 

5.4

%

 

 

(1.2

%)

 

 

0.3

%

 

 

(0.2

%)

 

 

(1.3

%)

San Diego

 

 

2,878

 

 

 

4.3

%

 

 

3,103

 

 

 

96.1

%

 

 

8.0

%

 

 

0.7

%

 

 

4.7

%

 

 

(0.4

%)

 

 

(0.2

%)

 

 

0.8

%

 

 

(3.3

%)

Subtotal – Southern California

 

20,731

 

 

 

26.8

%

 

 

2,943

 

 

 

95.7

%

 

 

9.0

%

 

 

0.7

%

 

 

7.3

%

 

 

(1.7

%)

 

 

0.3

%

 

 

0.4

%

 

 

(1.6

%)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Washington, D.C.

 

 

14,716

 

 

 

16.8

%

 

 

2,665

 

 

 

97.1

%

 

 

7.0

%

 

 

0.6

%

 

 

4.8

%

 

 

(1.3

%)

 

 

0.4

%

 

 

0.1

%

 

 

(1.2

%)

San Francisco

 

 

11,345

 

 

 

15.7

%

 

 

3,281

 

 

 

96.4

%

 

 

9.5

%

 

 

0.6

%

 

 

8.2

%

 

 

(2.7

%)

 

 

(0.6

%)

 

 

1.1

%

 

 

(1.4

%)

New York

 

 

8,536

 

 

 

14.0

%

 

 

4,592

 

 

 

97.0

%

 

 

6.5

%

 

 

1.0

%

 

 

6.7

%

 

 

(2.8

%)

 

 

0.6

%

 

 

0.4

%

 

 

(0.4

%)

Boston

 

 

7,077

 

 

 

11.0

%

 

 

3,557

 

 

 

95.7

%

 

 

7.4

%

 

 

(0.4

%)

 

 

3.3

%

 

 

(1.9

%)

 

 

(0.3

%)

 

 

(0.1

%)

 

 

(1.2

%)

Seattle

 

 

9,266

 

 

 

10.4

%

 

 

2,569

 

 

 

96.1

%

 

 

9.7

%

 

 

1.2

%

 

 

8.3

%

 

 

(1.5

%)

 

 

0.3

%

 

 

0.8

%

 

 

1.5

%

Denver

 

 

2,792

 

 

 

2.9

%

 

 

2,409

 

 

 

96.2

%

 

 

10.5

%

 

 

0.1

%

 

 

6.6

%

 

 

(2.5

%)

 

 

(0.1

%)

 

 

0.2

%

 

 

(1.3

%)

Other Expansion Markets

 

 

3,487

 

 

 

2.4

%

 

 

1,979

 

 

 

95.3

%

 

 

13.3

%

 

 

(1.1

%)

 

 

6.9

%

 

 

(6.4

%)

 

 

(1.5

%)

 

 

0.5

%

 

 

0.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

77,950

 

 

 

100.0

%

 

$

3,070

 

 

 

96.3

%

 

 

8.6

%

 

 

0.6

%

 

 

6.5

%

 

 

(2.1

%)

 

 

0.1

%

 

 

0.5

%

 

 

(0.9

%)

 

Note: The above table reflects Residential same store results only. Residential operations account for approximately 96.0% of total revenues for the quarter ended March 31, 2024.

Equity Residential

Same Store Residential Net Effective Lease Pricing Statistics

For 77,373 Same Store Apartment Units

 

 

 

New Lease Change (1)

 

Renewal Rate Achieved (1)

 

Blended Rate (1)

Markets/Metro Areas

 

Q1 2024

 

Q4 2023

 

Q1 2024

 

Q4 2023

 

Q1 2024

 

Q4 2023

Southern California

 

 

(3.6

%)

 

 

(3.1

%)

 

 

4.4

%

 

 

5.2

%

 

 

0.5

%

 

 

1.2

%

San Francisco

 

 

(1.2

%)

 

 

(9.7

%)

 

 

4.1

%

 

 

4.4

%

 

 

1.6

%

 

 

(3.1

%)

Washington, D.C.

 

 

1.6

%

 

 

0.6

%

 

 

5.8

%

 

 

6.2

%

 

 

4.0

%

 

 

3.8

%

New York

 

 

(1.1

%)

 

 

(2.2

%)

 

 

4.1

%

 

 

4.5

%

 

 

2.2

%

 

 

2.1

%

Seattle

 

 

(1.2

%)

 

 

(8.4

%)

 

 

6.1

%

 

 

5.6

%

 

 

2.8

%

 

 

(1.4

%)

Boston

 

 

(3.4

%)

 

 

(1.0

%)

 

 

5.2

%

 

 

5.3

%

 

 

1.0

%

 

 

2.8

%

Denver

 

 

(6.3

%)

 

 

(5.1

%)

 

 

4.3

%

 

 

4.7

%

 

 

(2.0

%)

 

 

(0.3

%)

Other Expansion Markets

 

 

(8.7

%)

 

 

(12.2

%)

 

 

4.1

%

 

 

4.8

%

 

 

(3.7

%)

 

 

(5.1

%)

Total

 

 

(2.2

%)

 

 

(4.6

%)

 

 

4.7

%

 

 

5.1

%

 

 

1.6

%

 

 

0.7

%

(1)

See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for definitions. See page 3 for April 2024 preliminary data.

Equity Residential

First Quarter 2024 vs. First Quarter 2023

Total Same Store Operating Expenses Including 77,373 Same Store Apartment Units

(includes Residential and Non-Residential)

($ in thousands)

 

 

 

Q1 2024

 

Q1 2023

 

$

Change (1)

 

%

Change

 

% of

Q1 2024

Operating

Expenses

Real estate taxes

 

$

94,205

 

 

$

90,844

 

 

$

3,361

 

 

 

3.7

%

 

 

40.6

%

On-site payroll

 

 

43,119

 

 

 

42,813

 

 

 

306

 

 

 

0.7

%

 

 

18.6

%

Utilities

 

 

37,234

 

 

 

39,197

 

 

 

(1,963

)

 

 

(5.0

%)

 

 

16.1

%

Repairs and maintenance

 

 

29,888

 

 

 

30,546

 

 

 

(658

)

 

 

(2.2

%)

 

 

12.9

%

Insurance

 

 

9,341

 

 

 

8,459

 

 

 

882

 

 

 

10.4

%

 

 

4.0

%

Leasing and advertising

 

 

2,375

 

 

 

2,591

 

 

 

(216

)

 

 

(8.3

%)

 

 

1.0

%

Other on-site operating expenses

 

 

15,743

 

 

 

14,511

 

 

 

1,232

 

 

 

8.5

%

 

 

6.8

%

Total Same Store Operating Expenses (2)

 

$

231,905

 

 

$

228,961

 

 

$

2,944

 

 

 

1.3

%

 

 

100.0

%

(1)

The quarter-over-quarter changes were primarily driven by the following factors:

 

 

 

Real estate taxes – Increase due to escalation in rates and assessed values including an approximately 1.0% contribution to growth from 421-a tax abatement burnoffs in New York City. Once the burnoffs are completed, previously rent-restricted apartment units will transition to market.

 

 

 

On-site payroll – Modest increase due primarily to higher wages partially offset by the impact of various innovation initiatives.

 

 

 

Utilities – Decrease from electric primarily driven by lower commodity prices.

 

 

 

Repairs and maintenance – Decrease due primarily to lower resident Turnover compared to the same period of 2023, moderation of previous wage/staffing pressures and a benefit from a relatively easy comparable period.

 

 

 

Insurance – Increase due to higher premiums on property insurance renewal due to conditions in the insurance market that while less difficult than recent years, remain challenging.

 

 

 

Other on-site operating expenses – Increase primarily driven by higher property-related legal expenses.

 

 

(2)

See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for additional details.

Equity Residential

Debt Summary as of March 31, 2024

($ in thousands)

 

 

 

Debt

Balances (1)

 

% of Total

 

Weighted

Average

Rates (1)

 

Weighted

Average

Maturities

(years)

Secured

 

$

1,633,870

 

 

 

22.7

%

 

 

3.84

%

 

 

7.6

 

Unsecured

 

 

5,575,859

 

 

 

77.3

%

 

 

3.65

%

 

 

8.2

 

Total

 

$

7,209,729

 

 

 

100.0

%

 

 

3.69

%

 

 

8.1

 

Fixed Rate Debt:

 

 

 

 

 

 

 

 

 

 

 

 

Secured – Conventional

 

$

1,399,221

 

 

 

19.4

%

 

 

3.89

%

 

 

7.1

 

Unsecured – Public

 

 

5,349,938

 

 

 

74.2

%

 

 

3.53

%

 

 

8.6

 

Fixed Rate Debt

 

 

6,749,159

 

 

 

93.6

%

 

 

3.60

%

 

 

8.3

 

Floating Rate Debt:

 

 

 

 

 

 

 

 

 

 

 

 

Secured – Tax Exempt

 

 

234,649

 

 

 

3.3

%

 

 

3.49

%

 

 

10.4

 

Unsecured – Revolving Credit Facility

 

 

 

 

 

 

 

 

 

 

 

3.6

 

Unsecured – Commercial Paper Program (2)

 

 

225,921

 

 

 

3.1

%

 

 

5.60

%

 

 

 

Floating Rate Debt

 

 

460,570

 

 

 

6.4

%

 

 

4.72

%

 

 

5.4

 

Total

 

$

7,209,729

 

 

 

100.0

%

 

 

3.69

%

 

 

8.1

 

(1)

See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for additional details.

(2)

At March 31, 2024, the weighted average maturity of commercial paper outstanding was 3 days. The weighted average amount outstanding for the quarter ended March 31, 2024 was approximately $333.1 million.

 

Note: The Company capitalized interest of approximately $3.1 million and $3.4 million during the quarters ended March 31, 2024 and 2023, respectively.

Equity Residential

Debt Maturity Schedule as of March 31, 2024

($ in thousands)

 

Year

 

Fixed

Rate

 

Floating

Rate

 

Total

 

% of Total

 

Weighted

Average Coupons

on Fixed

Rate Debt (1)

 

Weighted

Average

Coupons on

Total Debt (1)

2024

 

$

 

 

$

232,200

 

(2)

$

232,200

 

 

 

3.2

%

 

 

 

 

 

5.46

%

2025

 

 

450,000

 

 

 

8,100

 

 

 

458,100

 

 

 

6.3

%

 

 

3.38

%

 

 

3.38

%

2026

 

 

592,025

 

 

 

9,000

 

 

 

601,025

 

 

 

8.3

%

 

 

3.58

%

 

 

3.58

%

2027

 

 

400,000

 

 

 

9,800

 

 

 

409,800

 

 

 

5.6

%

 

 

3.25

%

 

 

3.26

%

2028

 

 

900,000

 

 

 

10,700

 

 

 

910,700

 

 

 

12.5

%

 

 

3.79

%

 

 

3.79

%

2029

 

 

888,120

 

 

 

11,500

 

 

 

899,620

 

 

 

12.4

%

 

 

3.30

%

 

 

3.31

%

2030

 

 

1,148,462

 

 

 

12,700

 

 

 

1,161,162

 

 

 

15.9

%

 

 

2.53

%

 

 

2.54

%

2031

 

 

528,500

 

 

 

39,800

 

 

 

568,300

 

 

 

7.8

%

 

 

1.94

%

 

 

2.05

%

2032

 

 

 

 

 

28,000

 

 

 

28,000

 

 

 

0.4

%

 

 

 

 

 

3.70

%

2033

 

 

550,000

 

 

 

2,300

 

 

 

552,300

 

 

 

7.6

%

 

 

5.22

%

 

 

5.22

%

2034+

 

 

1,350,850

 

 

 

108,600

 

 

 

1,459,450

 

 

 

20.0

%

 

 

4.39

%

 

 

4.27

%

Subtotal

 

 

6,807,957

 

 

 

472,700

 

 

 

7,280,657

 

 

 

100.0

%

 

 

3.53

%

 

 

3.58

%

Deferred Financing Costs and Unamortized (Discount)

 

 

(58,798

)

 

 

(12,130

)

 

 

(70,928

)

 

N/A

 

 

N/A

 

 

N/A

 

Total

 

$

6,749,159

 

 

$

460,570

 

 

$

7,209,729

 

 

 

100.0

%

 

 

3.53

%

 

 

3.58

%

(1)

See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for additional details.

(2)

Includes $226.0 million in principal outstanding on the Company's Commercial Paper Program.

Equity Residential

Selected Unsecured Public Debt Covenants

 

 

 

March 31,

 

December 31,

 

 

2024

 

2023

Debt to Adjusted Total Assets (not to exceed 60%)

 

25.8%

 

26.5%

 

 

 

 

 

Secured Debt to Adjusted Total Assets (not to exceed 40%)

 

6.7%

 

6.7%

 

 

 

 

 

Consolidated Income Available for Debt Service to

Maximum Annual Service Charges

(must be at least 1.5 to 1)

 

6.41

 

6.19

 

 

 

 

 

Total Unencumbered Assets to Unsecured Debt

(must be at least 125%)

 

528.1%

 

510.7%

 

Note: These selected covenants represent the most restrictive financial covenants relating to ERP Operating Limited Partnership's ("ERPOP") outstanding public debt securities. Equity Residential is the general partner of ERPOP.

Selected Credit Ratios

 

 

 

March 31,

 

December 31,

 

 

2024

 

2023

Total debt to Normalized EBITDAre

 

4.01x

 

4.17x

 

 

 

 

 

Net debt to Normalized EBITDAre

 

3.97x

 

4.12x

 

 

 

 

 

Unencumbered NOI as a % of total NOI

 

89.6%

 

89.8%

 

Note: See Normalized EBITDAre Reconciliations for detail.

Equity Residential

Capital Structure as of March 31, 2024

(Amounts in thousands except for share/unit and per share amounts)

 

Secured Debt

 

 

 

 

 

 

 

$

1,633,870

 

 

 

22.7

%

 

 

 

Unsecured Debt

 

 

 

 

 

 

 

 

5,575,859

 

 

 

77.3

%

 

 

 

Total Debt

 

 

 

 

 

 

 

 

7,209,729

 

 

 

100.0

%

 

 

22.6

%

Common Shares (includes Restricted Shares)

 

 

378,939,751

 

 

 

97.0

%

 

 

 

 

 

 

 

 

 

Units (includes OP Units and Restricted Units)

 

 

11,732,622

 

 

 

3.0

%

 

 

 

 

 

 

 

 

 

Total Shares and Units

 

 

390,672,373

 

 

 

100.0

%

 

 

 

 

 

 

 

 

 

Common Share Price at March 31, 2024

 

$

63.11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

24,655,333

 

 

 

99.9

%

 

 

 

Perpetual Preferred Equity (see below)

 

 

 

 

 

 

 

 

17,155

 

 

 

0.1

%

 

 

 

Total Equity

 

 

 

 

 

 

 

 

24,672,488

 

 

 

100.0

%

 

 

77.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Market Capitalization

 

 

 

 

 

 

 

$

31,882,217

 

 

 

 

 

 

100.0

%

 

Perpetual Preferred Equity as of March 31, 2024

(Amounts in thousands except for share and per share amounts)

 

Series

 

Call Date

 

Outstanding

Shares

 

 

Liquidation

Value

 

 

Annual

Dividend

Per Share

 

 

Annual

Dividend

Amount

 

Preferred Shares:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8.29% Series K (1)

 

12/10/26

 

 

343,100

 

 

$

17,155

 

 

$

4.145

 

 

$

1,422

 

(1)

During the first quarter of 2024, the Company repurchased and retired 402,500 Series K Preferred Shares with a liquidation value of $20.1 million for total cash consideration of approximately $21.8 million. As a result of this partial redemption, the Company incurred a cash charge of approximately $1.4 million which was recorded as a premium on the redemption of preferred shares, which impacted EPS and FFO per share but did not impact Normalized FFO per share.

Equity Residential

Common Share and Unit

Weighted Average Amounts Outstanding

 

 

Q1 2024

 

Q1 2023

Weighted Average Amounts Outstanding for Net Income Purposes:

 

 

 

 

 

 

Common Shares - basic

 

 

378,811,922

 

 

 

378,340,876

 

Shares issuable from assumed conversion/vesting of:

 

 

 

 

 

 

- OP Units

 

 

10,669,346

 

 

 

11,509,669

 

- long-term compensation shares/units

 

 

1,079,917

 

 

 

813,581

 

Total Common Shares and Units - diluted

 

 

390,561,185

 

 

 

390,664,126

 

 

 

 

 

 

 

 

Weighted Average Amounts Outstanding for FFO and Normalized FFO Purposes:

 

 

 

 

 

 

Common Shares - basic

 

 

378,811,922

 

 

 

378,340,876

 

OP Units - basic

 

 

10,669,346

 

 

 

11,509,669

 

Total Common Shares and OP Units - basic

 

 

389,481,268

 

 

 

389,850,545

 

Shares issuable from assumed conversion/vesting of:

 

 

 

 

 

 

- long-term compensation shares/units

 

 

1,079,917

 

 

 

813,581

 

Total Common Shares and Units - diluted

 

 

390,561,185

 

 

 

390,664,126

 

 

 

 

 

 

 

 

Period Ending Amounts Outstanding:

 

 

 

 

 

 

Common Shares (includes Restricted Shares)

 

 

378,939,751

 

 

 

378,898,221

 

Units (includes OP Units and Restricted Units)

 

 

11,732,622

 

 

 

12,515,083

 

Total Shares and Units

 

 

390,672,373

 

 

 

391,413,304

 

Equity Residential

Development and Lease-Up Projects as of March 31, 2024

(Amounts in thousands except for project and apartment unit amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Estimated/Actual

 

 

Projects

 

Location

 

Ownership

Percentage

 

No. of

Apartment

Units

 

 

Total

Budgeted Capital

Cost

 

 

Total

Book Value

to Date

 

 

Total

Debt (1)

 

 

Percentage

Completed

 

Start

Date

 

Initial

Occupancy

 

Completion

Date

 

Stabilization

Date

 

Percentage

Leased /

Occupied

CONSOLIDATED:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Projects Under Development:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Laguna Clara II

 

Santa Clara, CA

 

100%

 

 

225

 

 

$

152,621

 

 

$

91,314

 

 

$

 

 

63%

 

Q2 2022

 

Q4 2024

 

Q1 2025

 

Q4 2025

 

– / –

The Basin

 

Wakefield, MA

 

95%

 

 

440

 

 

 

232,172

 

 

 

64,415

 

 

 

 

 

11%

 

Q1 2024

 

Q4 2025

 

Q3 2026

 

Q2 2027

 

– / –

Projects Under Development - Consolidated

 

 

 

 

665

 

 

 

384,793

 

 

 

155,729

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Projects Completed Not Stabilized:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reverb (fka 9th and W) (2)

 

Washington, D.C.

 

92%

 

 

312

 

 

 

108,027

 

 

 

104,795

 

 

 

 

 

100%

 

Q3 2021

 

Q2 2023

 

Q2 2023

 

Q3 2024

 

96% / 93%

Projects Completed Not Stabilized - Consolidated

 

 

 

 

312

 

 

 

108,027

 

 

 

104,795

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

UNCONSOLIDATED:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Projects Under Development:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Alloy Sunnyside

 

Denver, CO

 

80%

 

 

209

 

 

 

70,004

 

 

 

64,752

 

 

 

28,682

 

 

95%

 

Q3 2021

 

Q2 2024

 

Q2 2024

 

Q1 2025

 

– / –

Alexan Harrison

 

Harrison, NY

 

62%

 

 

450

 

 

 

200,664

 

 

 

184,242

 

 

 

88,605

 

 

95%

 

Q3 2021

 

Q1 2024

 

Q4 2024

 

Q2 2026

 

9% / 2%

Solana Beeler Park

 

Denver, CO

 

90%

 

 

270

 

 

 

85,206

 

 

 

63,617

 

 

 

28,342

 

 

74%

 

Q4 2021

 

Q2 2024

 

Q3 2024

 

Q1 2025

 

– / –

Remy (Toll)

 

Frisco, TX

 

75%

 

 

357

 

 

 

98,937

 

 

 

85,096

 

 

 

39,336

 

 

86%

 

Q1 2022

 

Q2 2024

 

Q4 2024

 

Q3 2025

 

7% / –

Sadie (fka Settler) (Toll)

 

Fort Worth, TX

 

75%

 

 

362

 

 

 

82,775

 

 

 

63,612

 

 

 

22,058

 

 

82%

 

Q2 2022

 

Q2 2024

 

Q3 2024

 

Q3 2025

 

2% / –

Lyle (Toll) (2)

 

Dallas, TX

 

75%

 

 

334

 

 

 

86,332

 

 

 

66,296

 

 

 

26,390

 

 

84%

 

Q3 2022

 

Q1 2024

 

Q3 2024

 

Q1 2026

 

5% / 2%

Projects Under Development - Unconsolidated

 

 

 

 

1,982

 

 

 

623,918

 

 

 

527,615

 

 

 

233,413

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Development Projects - Consolidated

 

 

 

 

 

 

977

 

 

 

492,820

 

 

 

260,524

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Development Projects - Unconsolidated

 

 

 

 

 

 

1,982

 

 

 

623,918

 

 

 

527,615

 

 

 

233,413

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Development Projects

 

 

 

 

 

 

2,959

 

 

$

1,116,738

 

 

$

788,139

 

 

$

233,413

 

 

 

 

 

 

 

 

 

 

 

 

 

NOI CONTRIBUTION FROM DEVELOPMENT PROJECTS

Total Budgeted

Capital Cost

 

Q1 2024

NOI

Projects Under Development - Consolidated

$

384,793

 

 

$

 

Projects Completed Not Stabilized - Consolidated

 

108,027

 

 

 

1,019

 

Projects Under Development - Unconsolidated

 

623,918

 

 

 

(235

)

 

$

1,116,738

 

 

$

784

 

(1)

All unconsolidated projects are being partially funded with project-specific construction loans. None of these loans are recourse to the Company.

(2)

The land parcels under these projects are subject to long-term ground leases.

Equity Residential

Capital Expenditures to Real Estate

For the Quarter Ended March 31, 2024

(Amounts in thousands except for apartment unit and per apartment unit amounts)

 

 

Same Store

Properties

 

Non-Same Store

Properties/Other

 

Total

 

Same Store Avg.

Per Apartment Unit

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Apartment Units

 

 

77,373

 

 

 

2,315

 

 

 

79,688

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Building Improvements

 

$

28,741

 

 

$

3,340

 

(2)

$

32,081

 

 

$

371

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Renovation Expenditures

 

 

22,280

 

(1)

 

4,055

 

(2)

 

26,335

 

 

 

288

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Replacements

 

 

15,050

 

 

 

54

 

 

 

15,104

 

 

 

195

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Expenditures to Real Estate (3)

 

$

66,071

 

 

$

7,449

 

 

$

73,520

 

 

$

854

 

(1)

Renovation Expenditures on 690 same store apartment units for the quarter ended March 31, 2024 approximated $32,289 per apartment unit renovated.

(2)

Includes expenditures for two properties that have been removed from same store while undergoing major renovations requiring a significant number of apartment units to be vacated to accommodate the extensive planned improvements. The renovation at one property is expected to continue through the second quarter of 2024 with the other continuing into 2025.

(3)

See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for additional details.

 

Note: Approximately $29.3 million of the Company's Capital Expenditures to Real Estate for Same Store Properties for the quarter ended March 31, 2024 were NOI-Enhancing, including the $22.3 million of Renovation Expenditures noted above, with the remainder concentrated in sustainability and property-level technology spend.

Equity Residential

Normalized EBITDAre Reconciliations

(Amounts in thousands)

 

 

Trailing Twelve Months

 

2024

 

2023

 

 

March 31, 2024

 

December 31, 2023

 

Q1

 

Q4

 

Q3

 

Q2

 

Q1

Net income

 

$

953,449

 

 

$

868,488

 

 

$

305,032

 

 

$

322,269

 

 

$

181,286

 

 

$

144,862

 

 

$

220,071

 

Interest expense incurred, net

 

 

270,367

 

 

 

269,556

 

 

 

67,212

 

 

 

68,674

 

 

 

68,891

 

 

 

65,590

 

 

 

66,401

 

Amortization of deferred financing costs

 

 

8,880

 

 

 

8,941

 

 

 

1,918

 

 

 

1,918

 

 

 

3,027

 

 

 

2,017

 

 

 

1,979

 

Amortization of above/below market lease intangibles

 

 

4,464

 

 

 

4,464

 

 

 

1,116

 

 

 

1,116

 

 

 

1,116

 

 

 

1,116

 

 

 

1,116

 

Depreciation

 

 

898,574

 

 

 

888,709

 

 

 

225,695

 

 

 

226,788

 

 

 

224,736

 

 

 

221,355

 

 

 

215,830

 

Income and other tax expense (benefit)

 

 

1,154

 

 

 

1,148

 

 

 

304

 

 

 

256

 

 

 

258

 

 

 

336

 

 

 

298

 

EBITDA

 

 

2,136,888

 

 

 

2,041,306

 

 

 

601,277

 

 

 

621,021

 

 

 

479,314

 

 

 

435,276

 

 

 

505,695

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (gain) loss on sales of real estate properties

 

 

(370,515

)

 

 

(282,539

)

 

 

(188,185

)

 

 

(155,505

)

 

 

(26,912

)

 

 

87

 

 

 

(100,209

)

EBITDAre

 

 

1,766,373

 

 

 

1,758,767

 

 

 

413,092

 

 

 

465,516

 

 

 

452,402

 

 

 

435,363

 

 

 

405,486

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Write-off of pursuit costs (other expenses)

 

 

2,863

 

 

 

3,647

 

 

 

548

 

 

 

908

 

 

 

746

 

 

 

661

 

 

 

1,332

 

(Income) loss from investments in unconsolidated entities - operations

 

 

5,694

 

 

 

5,378

 

 

 

1,698

 

 

 

1,531

 

 

 

1,242

 

 

 

1,223

 

 

 

1,382

 

Realized (gain) loss on investment securities (interest and other income)

 

 

(1,591

)

 

 

(1,504

)

 

 

 

 

 

7

 

 

 

(1,598

)

 

 

 

 

 

87

 

Unrealized (gain) loss on investment securities (interest and other income)

 

 

(20,527

)

 

 

(13,466

)

 

 

(7,061

)

 

 

(9,005

)

 

 

(4,461

)

 

 

 

 

 

 

Insurance/litigation settlement or reserve income (interest and other income)

 

 

(360

)

 

 

(1,055

)

 

 

(105

)

 

 

 

 

 

(62

)

 

 

(193

)

 

 

(800

)

Insurance/litigation/environmental settlement or reserve expense (other expenses)

 

 

42,789

 

 

 

17,310

 

 

 

30,478

 

 

 

5,694

 

 

 

3,104

 

 

 

3,513

 

 

 

4,999

 

Advocacy contributions (other expenses)

 

 

2,276

 

 

 

2,142

 

 

 

141

 

 

 

1,665

 

 

 

150

 

 

 

320

 

 

 

7

 

Data transformation project (other expenses)

 

 

1,700

 

 

 

3,780

 

 

 

 

 

 

 

 

 

295

 

 

 

1,405

 

 

 

2,080

 

Other

 

 

(518

)

 

 

(589

)

 

 

77

 

 

 

(602

)

 

 

1

 

 

 

6

 

 

 

6

 

Normalized EBITDAre

 

$

1,798,699

 

 

$

1,774,410

 

 

$

438,868

 

 

$

465,714

 

 

$

451,819

 

 

$

442,298

 

 

$

414,579

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance Sheet Items:

 

March 31, 2024

 

December 31, 2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total debt

 

$

7,209,729

 

 

$

7,390,450

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

(44,535

)

 

 

(50,743

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage principal reserves/sinking funds

 

 

(31,203

)

 

 

(29,270

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net debt

 

$

7,133,991

 

 

$

7,310,437

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Note: EBITDA, EBITDAre and Normalized EBITDAre do not include any adjustments for the Company’s share of partially owned unconsolidated entities or the minority partner’s share of partially owned consolidated entities due to the immaterial size of the Company’s partially owned portfolio.

Equity Residential

Adjustments from FFO to Normalized FFO

(Amounts in thousands)

 

 

Quarter Ended March 31,

 

 

2024

 

2023

 

Variance

 

 

 

 

 

 

 

 

 

 

Impairment – non-operating real estate assets

 

$

 

 

$

 

 

$

 

 

 

 

 

 

 

 

 

 

 

Write-off of pursuit costs (other expenses)

 

 

548

 

 

 

1,332

 

 

 

(784

)

 

 

 

 

 

 

 

 

 

 

Premium on redemption of Preferred Shares

 

 

1,444

 

 

 

 

 

 

1,444

 

Debt extinguishment and preferred share redemption (gains) losses

 

 

1,444

 

 

 

 

 

 

1,444

 

 

 

 

 

 

 

 

 

 

 

(Income) loss from investments in unconsolidated entities ─ non-operating assets

 

 

955

 

 

 

627

 

 

 

328

 

Realized (gain) loss on investment securities (interest and other income)

 

 

 

 

 

87

 

 

 

(87

)

Unrealized (gain) loss on investment securities (interest and other income)

 

 

(7,061

)

 

 

 

 

 

(7,061

)

Non-operating asset (gains) losses

 

 

(6,106

)

 

 

714

 

 

 

(6,820

)

 

 

 

 

 

 

 

 

 

 

Insurance/litigation settlement or reserve income (interest and other income)

 

 

(105

)

 

 

(800

)

 

 

695

 

Insurance/litigation/environmental settlement or reserve expense (other expenses) (1)

 

 

30,478

 

 

 

4,999

 

 

 

25,479

 

Advocacy contributions (other expenses)

 

 

141

 

 

 

7

 

 

 

134

 

Data transformation project (other expenses)

 

 

 

 

 

2,080

 

 

 

(2,080

)

Other

 

 

77

 

 

 

6

 

 

 

71

 

Other miscellaneous items

 

 

30,591

 

 

 

6,292

 

 

 

24,299

 

 

 

 

 

 

 

 

 

 

 

Adjustments from FFO to Normalized FFO

 

$

26,477

 

 

$

8,338

 

 

$

18,139

 

(1)

Insurance/litigation/environmental settlement or reserve expense includes adjustments to reserves relating to, among other things, litigation in California regarding the amount of late fees charged by the Company.

Note: See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for the definitions of non-GAAP financial measures and other terms as well as the reconciliations of EPS to FFO per share and Normalized FFO per share.

Equity Residential

Normalized FFO Guidance and Assumptions

The guidance/projections provided below are based on current expectations and are forward-looking. All guidance is given on a Normalized FFO basis. Therefore, certain items excluded from Normalized FFO, such as debt extinguishment costs/prepayment penalties and the write-off of pursuit costs, are not included in the estimates provided on this page. See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for the definitions of non-GAAP financial measures and other terms as well as the reconciliations of EPS to FFO per share and Normalized FFO per share.

 

 

Q2 2024

 

Full Year 2024

 

 

 

 

(no change from previous Full Year 2024)

2024 Normalized FFO Guidance (per share diluted)

 

 

 

 

 

 

 

 

 

Expected Normalized FFO Per Share

 

$0.92 to $0.96

 

$3.80 to $3.90

 

 

 

 

 

2024 Same Store Assumptions (includes Residential and Non-Residential)

 

 

 

 

 

 

 

 

Physical Occupancy

 

 

 

95.9%

Revenue change

 

 

 

2.0% to 3.0%

Expense change

 

 

 

3.5% to 4.5%

NOI change (1)

 

 

 

1.0% to 2.6%

 

 

 

 

 

2024 Transaction Assumptions

 

 

 

 

 

 

 

 

 

Consolidated rental acquisitions

 

 

 

$1.0B

Consolidated rental dispositions

 

 

 

$1.0B

Transaction Accretion (Dilution)

 

 

 

(25 basis points)

 

 

 

 

 

2024 Debt Assumptions

 

 

 

 

 

 

 

 

 

Weighted average debt outstanding

 

 

 

$7.27B to $7.47B

Interest expense, net (on a Normalized FFO basis)

 

 

 

$268.0M to $274.0M

Capitalized interest

 

 

 

$9.7M to $13.7M

 

 

 

 

 

2024 Capital Expenditures to Real Estate Assumptions for Same Store Properties (2)

 

 

 

 

 

 

 

Capital Expenditures to Real Estate for Same Store Properties

 

 

 

$295.0M

Capital Expenditures to Real Estate per Same Store Apartment Unit

 

 

$3,800

 

 

 

 

 

2024 Other Guidance Assumptions

 

 

 

 

 

 

 

 

 

Property management expense