10-Q 1 ess-20210930.htm 10-Q ess-20210930
0000920522--12-312021Q3falsehttp://fasb.org/us-gaap/2021-01-31#AccountingStandardsUpdate201613Memberhttp://fasb.org/us-gaap/2021-01-31#AccountingStandardsUpdate201613Member32P6M00009205222021-01-012021-09-300000920522ess:EssexPortfolioL.P.Member2021-01-012021-09-30xbrli:shares00009205222021-10-25iso4217:USD00009205222021-09-3000009205222020-12-31iso4217:USDxbrli:shares00009205222021-07-012021-09-3000009205222020-07-012020-09-3000009205222020-01-012020-09-300000920522us-gaap:CommonStockMember2021-06-300000920522us-gaap:AdditionalPaidInCapitalMember2021-06-300000920522us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2021-06-300000920522us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-06-300000920522us-gaap:NoncontrollingInterestMember2021-06-3000009205222021-06-300000920522us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2021-07-012021-09-300000920522us-gaap:NoncontrollingInterestMember2021-07-012021-09-300000920522us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-07-012021-09-300000920522us-gaap:CommonStockMember2021-07-012021-09-300000920522us-gaap:AdditionalPaidInCapitalMember2021-07-012021-09-300000920522us-gaap:CommonStockMember2021-09-300000920522us-gaap:AdditionalPaidInCapitalMember2021-09-300000920522us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2021-09-300000920522us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-09-300000920522us-gaap:NoncontrollingInterestMember2021-09-300000920522us-gaap:CommonStockMember2020-12-310000920522us-gaap:AdditionalPaidInCapitalMember2020-12-310000920522us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2020-12-310000920522us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310000920522us-gaap:NoncontrollingInterestMember2020-12-310000920522us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2021-01-012021-09-300000920522us-gaap:NoncontrollingInterestMember2021-01-012021-09-300000920522us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-09-300000920522us-gaap:CommonStockMember2021-01-012021-09-300000920522us-gaap:AdditionalPaidInCapitalMember2021-01-012021-09-300000920522us-gaap:CommonStockMember2020-06-300000920522us-gaap:AdditionalPaidInCapitalMember2020-06-300000920522us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2020-06-300000920522us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-06-300000920522us-gaap:NoncontrollingInterestMember2020-06-3000009205222020-06-300000920522us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2020-07-012020-09-300000920522us-gaap:NoncontrollingInterestMember2020-07-012020-09-300000920522us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-07-012020-09-300000920522us-gaap:AdditionalPaidInCapitalMember2020-07-012020-09-300000920522us-gaap:CommonStockMember2020-07-012020-09-300000920522us-gaap:CommonStockMember2020-09-300000920522us-gaap:AdditionalPaidInCapitalMember2020-09-300000920522us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2020-09-300000920522us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-09-300000920522us-gaap:NoncontrollingInterestMember2020-09-3000009205222020-09-300000920522us-gaap:CommonStockMember2019-12-310000920522us-gaap:AdditionalPaidInCapitalMember2019-12-310000920522us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2019-12-310000920522us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-12-310000920522us-gaap:NoncontrollingInterestMember2019-12-3100009205222019-12-310000920522us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2020-01-012020-09-300000920522us-gaap:NoncontrollingInterestMember2020-01-012020-09-300000920522us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-01-012020-09-300000920522us-gaap:CommonStockMember2020-01-012020-09-300000920522us-gaap:AdditionalPaidInCapitalMember2020-01-012020-09-3000009205222019-01-012019-12-310000920522us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMembersrt:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310000920522srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310000920522ess:EssexPortfolioL.P.Member2021-09-300000920522ess:EssexPortfolioL.P.Member2020-12-310000920522ess:EssexPortfolioL.P.Memberus-gaap:GeneralPartnerMember2021-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:GeneralPartnerMember2020-12-310000920522ess:EssexPortfolioL.P.Memberus-gaap:LimitedPartnerMember2021-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:LimitedPartnerMember2020-12-310000920522ess:EssexPortfolioL.P.Member2021-07-012021-09-300000920522ess:EssexPortfolioL.P.Member2020-07-012020-09-300000920522ess:EssexPortfolioL.P.Member2020-01-012020-09-300000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:GeneralPartnerMember2021-06-300000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:LimitedPartnerMember2021-06-300000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedOtherComprehensiveIncomeMember2021-06-300000920522us-gaap:NoncontrollingInterestMemberess:EssexPortfolioL.P.Member2021-06-300000920522ess:EssexPortfolioL.P.Member2021-06-300000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:GeneralPartnerMember2021-07-012021-09-300000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:LimitedPartnerMember2021-07-012021-09-300000920522us-gaap:NoncontrollingInterestMemberess:EssexPortfolioL.P.Member2021-07-012021-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedOtherComprehensiveIncomeMember2021-07-012021-09-300000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:GeneralPartnerMember2021-09-300000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:LimitedPartnerMember2021-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedOtherComprehensiveIncomeMember2021-09-300000920522us-gaap:NoncontrollingInterestMemberess:EssexPortfolioL.P.Member2021-09-300000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:GeneralPartnerMember2020-12-310000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:LimitedPartnerMember2020-12-310000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310000920522us-gaap:NoncontrollingInterestMemberess:EssexPortfolioL.P.Member2020-12-310000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:GeneralPartnerMember2021-01-012021-09-300000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:LimitedPartnerMember2021-01-012021-09-300000920522us-gaap:NoncontrollingInterestMemberess:EssexPortfolioL.P.Member2021-01-012021-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-09-300000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:GeneralPartnerMember2020-06-300000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:LimitedPartnerMember2020-06-300000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedOtherComprehensiveIncomeMember2020-06-300000920522us-gaap:NoncontrollingInterestMemberess:EssexPortfolioL.P.Member2020-06-300000920522ess:EssexPortfolioL.P.Member2020-06-300000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:GeneralPartnerMember2020-07-012020-09-300000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:LimitedPartnerMember2020-07-012020-09-300000920522us-gaap:NoncontrollingInterestMemberess:EssexPortfolioL.P.Member2020-07-012020-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedOtherComprehensiveIncomeMember2020-07-012020-09-300000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:GeneralPartnerMember2020-09-300000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:LimitedPartnerMember2020-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedOtherComprehensiveIncomeMember2020-09-300000920522us-gaap:NoncontrollingInterestMemberess:EssexPortfolioL.P.Member2020-09-300000920522ess:EssexPortfolioL.P.Member2020-09-300000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:GeneralPartnerMember2019-12-310000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:LimitedPartnerMember2019-12-310000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedOtherComprehensiveIncomeMember2019-12-310000920522us-gaap:NoncontrollingInterestMemberess:EssexPortfolioL.P.Member2019-12-310000920522ess:EssexPortfolioL.P.Member2019-12-310000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:GeneralPartnerMember2020-01-012020-09-300000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:LimitedPartnerMember2020-01-012020-09-300000920522us-gaap:NoncontrollingInterestMemberess:EssexPortfolioL.P.Member2020-01-012020-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedOtherComprehensiveIncomeMember2020-01-012020-09-300000920522ess:EssexPortfolioL.P.Member2019-01-012019-12-310000920522ess:CommonEquityMemberess:EssexPortfolioL.P.Memberus-gaap:GeneralPartnerMembersrt:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310000920522ess:EssexPortfolioL.P.Membersrt:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-31xbrli:pure0000920522ess:OperatingPartnershipMember2021-01-012021-09-300000920522ess:OperatingPartnershipMember2020-01-012020-12-31ess:communityess:apartmentess:buildingess:project0000920522srt:MinimumMember2021-09-300000920522srt:MaximumMember2021-09-300000920522us-gaap:DebtSecuritiesMember2021-09-300000920522us-gaap:DebtSecuritiesMember2021-01-012021-09-300000920522us-gaap:CommonStockMember2021-09-300000920522us-gaap:CommonStockMember2021-01-012021-09-300000920522us-gaap:CorporateDebtSecuritiesMember2021-09-300000920522us-gaap:DebtSecuritiesMember2020-12-310000920522us-gaap:DebtSecuritiesMember2020-01-012020-12-310000920522us-gaap:CommonStockMember2020-12-310000920522us-gaap:CommonStockMember2020-01-012020-12-310000920522us-gaap:CorporateDebtSecuritiesMember2020-12-310000920522ess:InterestAndOtherIncomeExpenseMember2021-07-012021-09-300000920522ess:InterestAndOtherIncomeExpenseMember2021-01-012021-09-300000920522ess:InterestAndOtherIncomeExpenseMember2020-07-012020-09-300000920522ess:InterestAndOtherIncomeExpenseMember2020-01-012020-09-30ess:partnershipess:investment0000920522us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2020-12-310000920522us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2020-12-310000920522us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2021-01-012021-09-300000920522us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2021-01-012021-09-300000920522us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2021-09-300000920522us-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2021-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2020-12-310000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2020-12-310000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2021-01-012021-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2021-01-012021-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2021-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedNetUnrealizedInvestmentGainLossMember2021-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:AccumulatedOtherComprehensiveIncomeMember2021-09-300000920522ess:CommercialProperty7SouthLindenSouthSanFranciscoCAMember2021-09-012021-09-30ess:commercial_lease0000920522srt:ApartmentBuildingMemberess:MarthaLakeApartmentMemberess:WescoVILLCMember2021-09-012021-09-300000920522ess:MarthaLakeApartmentMemberess:WescoVILLCMember2021-09-012021-09-300000920522ess:RelatedPartyBridgeLoansOnPropertyAcquiredByWescoVIMembersrt:AffiliatedEntityMember2021-09-300000920522ess:RelatedPartyBridgeLoansOnPropertyAcquiredByWescoVIMembersrt:AffiliatedEntityMember2021-09-012021-09-300000920522ess:CommercialPropertyThirdBroadSeattleWAMember2021-09-012021-09-300000920522ess:TheVillageAtTolucaLakeMemberess:JointVenturePartnerBEXIIIMember2021-06-012021-06-300000920522ess:TheVillageAtTolucaLakeMembersrt:ApartmentBuildingMemberess:JointVenturePartnerBEXIIIMember2021-06-012021-06-300000920522srt:ApartmentBuildingMemberess:DevonshireHemetCAMember2021-08-012021-08-310000920522ess:DevonshireHemetCAMember2021-08-012021-08-310000920522srt:ApartmentBuildingMemberess:HiddenValleySimiValleyCAMember2021-02-012021-02-280000920522ess:HiddenValleySimiValleyCAMember2021-02-012021-02-280000920522ess:Park20SanMateoCAMembersrt:ApartmentBuildingMember2021-02-012021-02-280000920522ess:Park20SanMateoCAMember2021-02-012021-02-280000920522srt:ApartmentBuildingMemberess:Axis2300IrvineCAMember2021-02-012021-02-280000920522ess:Axis2300IrvineCAMember2021-02-012021-02-280000920522ess:WescoVILLCMember2021-09-012021-09-300000920522ess:WescoVILLCMember2021-09-3000009205222021-09-012021-09-3000009205222021-08-012021-08-3100009205222021-01-012021-01-310000920522ess:PreferredEquityInvestmentPropertyInNorthernCaliforniaMember2021-08-012021-08-310000920522ess:PreferredEquityInvestmentPropertyInSouthernCaliforniaMember2021-03-012021-03-310000920522ess:JointVentureThatHoldsPropertyInSouthernCaliforniaMember2021-03-012021-03-310000920522ess:RelatedPartyBridgeLoansOnPropertyAcquiredByWescoIMembersrt:AffiliatedEntityMember2021-03-310000920522ess:RelatedPartyBridgeLoansOnPropertyAcquiredByWescoIMembersrt:AffiliatedEntityMember2021-03-012021-03-310000920522ess:SecuredNoteReceivable11.00InterestRateDueOctober2023Member2021-06-012021-06-300000920522us-gaap:CommonStockMember2021-01-012021-03-3100009205222021-04-012021-09-300000920522ess:EssexPortfolioL.P.Memberess:SeniorUnsecuredNotesMaturing2028Memberus-gaap:SeniorNotesMember2021-03-310000920522ess:EssexPortfolioL.P.Memberess:SeniorUnsecuredNotesMaturing2031Memberus-gaap:SeniorNotesMember2021-06-300000920522ess:EssexPortfolioL.P.Memberess:SeniorUnsecuredNotesMaturing2023Memberus-gaap:SeniorNotesMember2021-06-300000920522us-gaap:SubsequentEventMembersrt:ApartmentBuildingMemberess:MonterraInMillCreekMemberess:WescoVILLCMember2021-10-012021-10-270000920522us-gaap:SubsequentEventMemberess:MonterraInMillCreekMemberess:WescoVILLCMember2021-10-012021-10-270000920522ess:NotesReceivableMezzanineLoansMembersrt:ScenarioForecastMember2022-12-310000920522ess:NotesReceivableMezzanineLoansMembersrt:ScenarioForecastMember2022-07-012022-12-310000920522ess:RentalMember2021-07-012021-09-300000920522ess:RentalMember2020-07-012020-09-300000920522ess:RentalMember2021-01-012021-09-300000920522ess:RentalMember2020-01-012020-09-300000920522ess:OtherPropertyLeasingRevenueMember2021-07-012021-09-300000920522ess:OtherPropertyLeasingRevenueMember2020-07-012020-09-300000920522ess:OtherPropertyLeasingRevenueMember2021-01-012021-09-300000920522ess:OtherPropertyLeasingRevenueMember2020-01-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberus-gaap:OperatingSegmentsMemberess:SouthernCaliforniaMember2021-07-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberus-gaap:OperatingSegmentsMemberess:SouthernCaliforniaMember2020-07-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberus-gaap:OperatingSegmentsMemberess:SouthernCaliforniaMember2021-01-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberus-gaap:OperatingSegmentsMemberess:SouthernCaliforniaMember2020-01-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberus-gaap:OperatingSegmentsMemberess:NorthernCaliforniaMember2021-07-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberus-gaap:OperatingSegmentsMemberess:NorthernCaliforniaMember2020-07-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberus-gaap:OperatingSegmentsMemberess:NorthernCaliforniaMember2021-01-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberus-gaap:OperatingSegmentsMemberess:NorthernCaliforniaMember2020-01-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:SeattleMetroMemberus-gaap:OperatingSegmentsMember2021-07-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:SeattleMetroMemberus-gaap:OperatingSegmentsMember2020-07-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:SeattleMetroMemberus-gaap:OperatingSegmentsMember2021-01-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:SeattleMetroMemberus-gaap:OperatingSegmentsMember2020-01-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberus-gaap:CorporateNonSegmentMember2021-07-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberus-gaap:CorporateNonSegmentMember2020-07-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberus-gaap:CorporateNonSegmentMember2021-01-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberus-gaap:CorporateNonSegmentMember2020-01-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMember2021-07-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMember2020-07-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMember2021-01-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMember2020-01-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertySamePropertyMember2021-07-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertySamePropertyMember2020-07-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertySamePropertyMember2021-01-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertySamePropertyMember2020-01-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyAcquiredMember2021-07-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyAcquiredMember2020-07-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyAcquiredMember2021-01-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyAcquiredMember2020-01-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyDevelopmentMember2021-07-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyDevelopmentMember2020-07-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyDevelopmentMember2021-01-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyDevelopmentMember2020-01-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyRedevelopmentMember2021-07-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyRedevelopmentMember2020-07-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyRedevelopmentMember2021-01-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyRedevelopmentMember2020-01-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyNonResidentialOtherNetMember2021-07-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyNonResidentialOtherNetMember2020-07-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyNonResidentialOtherNetMember2021-01-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyNonResidentialOtherNetMember2020-01-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:StraightLineRentConcessionMember2021-07-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:StraightLineRentConcessionMember2020-07-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:StraightLineRentConcessionMember2021-01-012021-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:StraightLineRentConcessionMember2020-01-012020-09-300000920522ess:RentalAndOtherPropertyRevenuesMemberess:RealEstatePropertyNonResidentialOtherNetMember2021-09-3000009205222021-10-012021-09-3000009205222022-01-012021-09-300000920522ess:MembershipInterestInWescoIIIIIVVAndVIMember2021-01-012021-09-300000920522ess:MembershipInterestInWescoIIIIIVVAndVIMember2021-09-300000920522ess:MembershipInterestInWescoIIIIIVVAndVIMember2020-12-310000920522ess:MembershipInterestInBEXAEWBEXIIBEXIIIBEXIVAnd500FolsomMember2021-01-012021-09-300000920522ess:MembershipInterestInBEXAEWBEXIIBEXIIIBEXIVAnd500FolsomMember2021-09-300000920522ess:MembershipInterestInBEXAEWBEXIIBEXIIIBEXIVAnd500FolsomMember2020-12-310000920522ess:MembershipInterestInLimitedLiabilityCompanyThatOwnsAndIsDevelopingExpoMember2021-01-012021-09-300000920522ess:MembershipInterestInLimitedLiabilityCompanyThatOwnsAndIsDevelopingExpoMember2021-09-300000920522ess:MembershipInterestInLimitedLiabilityCompanyThatOwnsAndIsDevelopingExpoMember2020-12-310000920522ess:TotalOperatingCoInvestmentsMember2021-09-300000920522ess:TotalOperatingCoInvestmentsMember2020-12-310000920522ess:TotalDevelopmentCoInvestmentsMember2021-01-012021-09-300000920522ess:TotalDevelopmentCoInvestmentsMember2021-09-300000920522ess:TotalDevelopmentCoInvestmentsMember2020-12-310000920522ess:TotalPreferredInterestInvestmentsMemberus-gaap:InvestmentsInMajorityOwnedSubsidiariesMember2021-09-300000920522ess:TotalPreferredInterestInvestmentsMemberus-gaap:InvestmentsInMajorityOwnedSubsidiariesMember2020-12-310000920522ess:TotalPreferredInterestInvestmentsMember2021-09-300000920522ess:TotalPreferredInterestInvestmentsMember2020-12-310000920522us-gaap:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMemberess:TotalCoInvestmentMember2021-09-300000920522us-gaap:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMemberess:TotalCoInvestmentMember2020-12-310000920522us-gaap:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMemberess:TotalCoInvestmentMember2021-07-012021-09-300000920522us-gaap:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMemberess:TotalCoInvestmentMember2020-07-012020-09-300000920522us-gaap:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMemberess:TotalCoInvestmentMember2021-01-012021-09-300000920522us-gaap:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMemberess:TotalCoInvestmentMember2020-01-012020-09-300000920522srt:AffiliatedEntityMemberess:TotalCoInvestmentMember2021-07-012021-09-300000920522srt:AffiliatedEntityMemberess:TotalCoInvestmentMember2020-07-012020-09-300000920522srt:AffiliatedEntityMemberess:TotalCoInvestmentMember2021-01-012021-09-300000920522srt:AffiliatedEntityMemberess:TotalCoInvestmentMember2020-01-012020-09-300000920522ess:SecuredNoteReceivable9.90InterestRateDueNovember2019Member2021-01-012021-09-300000920522ess:SecuredNoteReceivable9.90InterestRateDueNovember2019Member2021-09-300000920522ess:SecuredNoteReceivable9.90InterestRateDueNovember2019Member2020-12-310000920522ess:SecuredNoteReceivable1050InterestRateDueFebruary2023Member2021-01-012021-09-300000920522ess:SecuredNoteReceivable1050InterestRateDueFebruary2023Member2021-09-300000920522ess:SecuredNoteReceivable1050InterestRateDueFebruary2023Member2020-12-310000920522ess:SecuredNoteReceivable11.00InterestRateDueOctober2023Member2021-01-012021-09-300000920522ess:SecuredNoteReceivable11.00InterestRateDueOctober2023Member2021-09-300000920522ess:SecuredNoteReceivable11.00InterestRateDueOctober2023Member2020-12-310000920522ess:SecuredNoteReceivable900InterestRateDueDecember2023Member2021-01-012021-09-300000920522ess:SecuredNoteReceivable900InterestRateDueDecember2023Member2021-09-300000920522ess:SecuredNoteReceivable900InterestRateDueDecember2023Member2020-12-310000920522ess:SecuredNoteReceivable1150InterestRateDueNovember2024Member2021-01-012021-09-300000920522ess:SecuredNoteReceivable1150InterestRateDueNovember2024Member2021-09-300000920522ess:SecuredNoteReceivable1150InterestRateDueNovember2024Member2020-12-310000920522ess:RelatedPartySecuredNoteReceivable215InterestRateDueDecember2021Member2021-01-012021-09-300000920522ess:RelatedPartySecuredNoteReceivable215InterestRateDueDecember2021Member2021-09-300000920522ess:RelatedPartySecuredNoteReceivable215InterestRateDueDecember2021Member2020-12-310000920522us-gaap:NotesReceivableMember2021-09-300000920522us-gaap:NotesReceivableMember2020-12-310000920522ess:StraightLineRentReceivableMember2021-09-300000920522ess:StraightLineRentReceivableMember2020-12-310000920522ess:OtherReceivablesMember2021-09-300000920522ess:OtherReceivablesMember2020-12-310000920522ess:NotesReceivableMezzanineLoansMember2020-12-310000920522ess:NotesReceivableBridgeLoanMember2020-12-310000920522ess:NotesReceivableMezzanineAndBridgeLoansMember2020-12-310000920522ess:NotesReceivableMezzanineLoansMember2021-01-012021-09-300000920522ess:NotesReceivableBridgeLoanMember2021-01-012021-09-300000920522ess:NotesReceivableMezzanineAndBridgeLoansMember2021-01-012021-09-300000920522ess:NotesReceivableMezzanineLoansMember2021-09-300000920522ess:NotesReceivableBridgeLoanMember2021-09-300000920522ess:NotesReceivableMezzanineAndBridgeLoansMember2021-09-300000920522srt:AffiliatedEntityMember2021-07-012021-09-300000920522srt:AffiliatedEntityMember2020-07-012020-09-300000920522srt:AffiliatedEntityMember2021-01-012021-09-300000920522srt:AffiliatedEntityMember2020-01-012020-09-300000920522srt:BoardOfDirectorsChairmanMemberess:MarcusandMillichapCompanyMember2021-01-012021-09-300000920522srt:BoardOfDirectorsChairmanMemberess:MarcusandMillichapCompanyMember2021-07-012021-09-300000920522srt:BoardOfDirectorsChairmanMemberess:MarcusandMillichapCompanyMember2020-07-012020-09-300000920522srt:BoardOfDirectorsChairmanMemberess:MarcusandMillichapCompanyMember2020-01-012020-09-300000920522ess:RelatedPartyBridgeLoansOnPropertyAcquiredByWescoVMembersrt:AffiliatedEntityMemberess:ApartmentHomeCommunityInSeattleWAMember2019-11-300000920522srt:AffiliatedEntityMemberess:ApartmentHomeCommunityInSeattleWAMember2019-11-012019-11-300000920522ess:RelatedPartyBridgeLoansOnPropertyAcquiredByWescoVMembersrt:AffiliatedEntityMemberess:ApartmentHomeCommunityInSeattleWAMember2019-11-012019-11-300000920522ess:BrioWalnutCreekCaliforniaMembersrt:BoardOfDirectorsChairmanMemberess:MarcusandMillichapCompanyMember2019-06-012019-06-300000920522ess:MultifamilyDevelopmentInMountainViewCAMembersrt:BoardOfDirectorsChairmanMember2019-02-012019-02-280000920522srt:BoardOfDirectorsChairmanMemberess:HomeCommunityDevelopmentinBurlingameCaliforniaMember2018-10-012018-10-310000920522ess:ApartmentHomeCommunityInVenturaCaliforniaMembersrt:BoardOfDirectorsChairmanMemberess:MarcusandMillichapCompanyMember2018-05-012018-05-310000920522ess:ApartmentHomeCommunityInVenturaCaliforniaMembersrt:BoardOfDirectorsChairmanMemberess:MarcusandMillichapCompanyMember2018-05-012021-09-300000920522ess:MembershipInterestInSageAtCupertinoMember2017-03-31ess:unit0000920522ess:MembershipInterestInSageAtCupertinoMember2017-03-012017-03-310000920522srt:AffiliatedEntityMember2021-09-300000920522srt:AffiliatedEntityMember2020-12-310000920522ess:UnsecuredBondsPrivatePlacementMember2021-09-300000920522ess:UnsecuredBondsPrivatePlacementMember2020-12-310000920522ess:UnsecuredBondsPrivatePlacementMember2021-01-012021-09-300000920522us-gaap:LoansPayableMember2021-09-300000920522us-gaap:LoansPayableMember2020-12-310000920522us-gaap:LoansPayableMember2021-01-012021-09-300000920522ess:FixedRatePublicOfferingBondMember2021-09-300000920522ess:FixedRatePublicOfferingBondMember2020-12-310000920522ess:FixedRatePublicOfferingBondMember2021-01-012021-09-300000920522us-gaap:LineOfCreditMember2021-09-300000920522us-gaap:LineOfCreditMember2020-12-310000920522ess:MortgageNotesMember2021-09-300000920522ess:MortgageNotesMember2020-12-310000920522ess:MortgageNotesMember2021-01-012021-09-300000920522us-gaap:UnsecuredDebtMember2021-09-300000920522us-gaap:UnsecuredDebtMember2020-12-31ess:instrument0000920522us-gaap:LineOfCreditMember2021-01-012021-09-300000920522us-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:LineOfCreditMember2021-01-012021-09-30ess:extension0000920522us-gaap:LineOfCreditMemberess:LineOfCreditWorkingCapitalMember2021-09-300000920522us-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:LineOfCreditMemberess:LineOfCreditWorkingCapitalMember2021-01-012021-09-30ess:segment0000920522us-gaap:OperatingSegmentsMemberess:SouthernCaliforniaMember2021-07-012021-09-300000920522us-gaap:OperatingSegmentsMemberess:SouthernCaliforniaMember2020-07-012020-09-300000920522us-gaap:OperatingSegmentsMemberess:SouthernCaliforniaMember2021-01-012021-09-300000920522us-gaap:OperatingSegmentsMemberess:SouthernCaliforniaMember2020-01-012020-09-300000920522us-gaap:OperatingSegmentsMemberess:NorthernCaliforniaMember2021-07-012021-09-300000920522us-gaap:OperatingSegmentsMemberess:NorthernCaliforniaMember2020-07-012020-09-300000920522us-gaap:OperatingSegmentsMemberess:NorthernCaliforniaMember2021-01-012021-09-300000920522us-gaap:OperatingSegmentsMemberess:NorthernCaliforniaMember2020-01-012020-09-300000920522ess:SeattleMetroMemberus-gaap:OperatingSegmentsMember2021-07-012021-09-300000920522ess:SeattleMetroMemberus-gaap:OperatingSegmentsMember2020-07-012020-09-300000920522ess:SeattleMetroMemberus-gaap:OperatingSegmentsMember2021-01-012021-09-300000920522ess:SeattleMetroMemberus-gaap:OperatingSegmentsMember2020-01-012020-09-300000920522us-gaap:CorporateNonSegmentMember2021-07-012021-09-300000920522us-gaap:CorporateNonSegmentMember2020-07-012020-09-300000920522us-gaap:CorporateNonSegmentMember2021-01-012021-09-300000920522us-gaap:CorporateNonSegmentMember2020-01-012020-09-300000920522ess:ManagementAndOtherFeesFromAffiliatesIncomeMember2021-07-012021-09-300000920522ess:ManagementAndOtherFeesFromAffiliatesIncomeMember2020-07-012020-09-300000920522ess:ManagementAndOtherFeesFromAffiliatesIncomeMember2021-01-012021-09-300000920522ess:ManagementAndOtherFeesFromAffiliatesIncomeMember2020-01-012020-09-300000920522us-gaap:OperatingSegmentsMemberess:SouthernCaliforniaMember2021-09-300000920522us-gaap:OperatingSegmentsMemberess:SouthernCaliforniaMember2020-12-310000920522us-gaap:OperatingSegmentsMemberess:NorthernCaliforniaMember2021-09-300000920522us-gaap:OperatingSegmentsMemberess:NorthernCaliforniaMember2020-12-310000920522ess:SeattleMetroMemberus-gaap:OperatingSegmentsMember2021-09-300000920522ess:SeattleMetroMemberus-gaap:OperatingSegmentsMember2020-12-310000920522us-gaap:CorporateNonSegmentMember2021-09-300000920522us-gaap:CorporateNonSegmentMember2020-12-310000920522ess:DownREITUnitsMember2021-01-012021-09-300000920522ess:DownREITUnitsMember2020-01-012020-09-300000920522ess:ConvertibleLimitedPartnershipUnitsMember2021-07-012021-09-300000920522ess:ConvertibleLimitedPartnershipUnitsMember2020-07-012020-09-300000920522ess:ConvertibleLimitedPartnershipUnitsMember2021-01-012021-09-300000920522ess:ConvertibleLimitedPartnershipUnitsMember2020-01-012020-09-300000920522us-gaap:EmployeeStockOptionMember2021-07-012021-09-300000920522us-gaap:EmployeeStockOptionMember2020-07-012020-09-300000920522us-gaap:EmployeeStockOptionMember2021-01-012021-09-300000920522us-gaap:EmployeeStockOptionMember2020-01-012020-09-300000920522ess:DownREITUnitsMemberess:EssexPortfolioL.P.Member2021-01-012021-09-300000920522ess:DownREITUnitsMemberess:EssexPortfolioL.P.Member2020-01-012020-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:EmployeeStockOptionMember2021-07-012021-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:EmployeeStockOptionMember2020-07-012020-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:EmployeeStockOptionMember2021-01-012021-09-300000920522ess:EssexPortfolioL.P.Memberus-gaap:EmployeeStockOptionMember2020-01-012020-09-300000920522us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateSwapMember2021-09-300000920522us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateSwapMember2020-12-310000920522ess:MultifamilyHousingMortgageRevenueBondsMemberess:TotalReturnSwapCallableMemberus-gaap:NondesignatedMember2021-09-300000920522ess:TotalReturnSwapCallableMemberus-gaap:NondesignatedMember2021-09-300000920522ess:MultifamilyHousingMortgageRevenueBondsMember2021-09-300000920522ess:TotalReturnSwapCallableMemberus-gaap:NondesignatedMember2020-12-310000920522ess:TotalReturnSwapCallableMember2021-07-012021-09-300000920522ess:TotalReturnSwapCallableMember2020-07-012020-09-300000920522ess:TotalReturnSwapCallableMember2021-01-012021-09-300000920522ess:TotalReturnSwapCallableMember2020-01-012020-09-30
                                
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2021

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________to _________

001-13106 (Essex Property Trust, Inc.)
333-44467-01 (Essex Portfolio, L.P.)
(Commission File Number)

ESSEX PROPERTY TRUST, INC.
ESSEX PORTFOLIO, L.P.
(Exact name of Registrant as Specified in its Charter)
Maryland77-0369576
(Essex Property Trust, Inc.)(Essex Property Trust, Inc.)
California77-0369575
 (Essex Portfolio, L.P.)(Essex Portfolio, L.P.)
(State or Other Jurisdiction of Incorporation or Organization)(I.R.S. Employer Identification Number)
1100 Park Place, Suite 200
San Mateo, California 94403
(Address of Principal Executive Offices, Including Zip Code)

(650) 655-7800
(Registrant's Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act: 
Title of each classTrading
Symbol(s)
Name of each exchange on which registered
Common Stock, $.0001 par value (Essex Property Trust, Inc.)ESSNew York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Essex Property Trust, Inc.YesNoEssex Portfolio, L.P.YesNo

i


Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Essex Property Trust, Inc.YesNoEssex Portfolio, L.P.YesNo

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act. 

Essex Property Trust, Inc.:
Large accelerated filer
Accelerated filerNon-accelerated filerSmaller reporting company
Emerging growth company

Essex Portfolio, L.P.:
Large accelerated filerAccelerated filerNon-accelerated filer
Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Essex Property Trust, Inc.Essex Portfolio, L.P.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Essex Property Trust, Inc.YesNoEssex Portfolio, L.P.YesNo
 
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: 65,087,831 shares of Common Stock ($.0001 par value) of Essex Property Trust, Inc. were outstanding as of October 25, 2021.
ii


EXPLANATORY NOTE

This report combines the reports on Form 10-Q for the three and nine month periods ended September 30, 2021 of Essex Property Trust, Inc., a Maryland corporation, and Essex Portfolio, L.P., a Delaware limited partnership of which Essex Property Trust, Inc. is the sole general partner.

Unless stated otherwise or the context otherwise requires, references to the "Company," "we," "us" or "our" mean collectively Essex Property Trust, Inc. and those entities/subsidiaries owned or controlled by Essex Property Trust, Inc., including Essex Portfolio, L.P., and references to the "Operating Partnership" mean Essex Portfolio, L.P. and those entities/subsidiaries owned or controlled by Essex Portfolio, L.P. Unless stated otherwise or the context otherwise requires, references to "Essex" mean Essex Property Trust, Inc., not including any of its subsidiaries.

Essex operates as a self-administered and self-managed real estate investment trust ("REIT"), and is the sole general partner of the Operating Partnership. As the sole general partner of the Operating Partnership, Essex has exclusive control of the Operating Partnership's day-to-day management.

The Company is structured as an umbrella partnership REIT ("UPREIT") and Essex contributes all net proceeds from its various equity offerings to the Operating Partnership. In return for those contributions, Essex receives a number of Operating Partnership limited partnership units ("OP Units," and the holders of such OP Units, "Unitholders") equal to the number of shares of common stock it has issued in the equity offerings. Contributions of properties to the Company can be structured as tax-deferred transactions through the issuance of OP Units, which is one of the reasons why the Company is structured in the manner outlined above. Based on the terms of the Operating Partnership's partnership agreement, OP Units can be exchanged into Essex common stock on a one-for-one basis. The Company maintains a one-for-one relationship between the OP Units issued to Essex and shares of common stock.

The Company believes that combining the reports on Form 10-Q of Essex and the Operating Partnership into this single report provides the following benefits:

enhances investors' understanding of Essex and the Operating Partnership by enabling investors to view the business as a whole in the same manner as management views and operates the business;
eliminates duplicative disclosure and provides a more streamlined and readable presentation since a substantial portion of the disclosure applies to both Essex and the Operating Partnership; and
creates time and cost efficiencies through the preparation of one combined report instead of two separate reports.

Management operates Essex and the Operating Partnership as one business. The management of Essex consists of the same members as the management of the Operating Partnership.

All of the Company's property ownership, development, and related business operations are conducted through the Operating Partnership and Essex has no material assets, other than its investment in the Operating Partnership. Essex's primary function is acting as the general partner of the Operating Partnership. As general partner with control of the Operating Partnership, Essex consolidates the Operating Partnership for financial reporting purposes. Therefore, the assets and liabilities of Essex and the Operating Partnership are the same on their respective financial statements. Essex also issues equity from time to time and guarantees certain debt of the Operating Partnership, as disclosed in this report. The Operating Partnership holds substantially all of the assets of the Company, including the Company's ownership interests in its co-investments. The Operating Partnership conducts the operations of the business and is structured as a partnership with no publicly traded equity. Except for the net proceeds from equity offerings by the Company, which are contributed to the capital of the Operating Partnership in exchange for OP Units (on a one-for-one share of common stock per OP Unit basis), the Operating Partnership generates all remaining capital required by the Company's business. These sources of capital include the Operating Partnership's working capital, net cash provided by operating activities, borrowings under its revolving credit facilities, the issuance of secured and unsecured debt and equity securities and proceeds received from disposition of certain properties and co-investments.

The Company believes it is important to understand the few differences between Essex and the Operating Partnership in the context of how Essex and the Operating Partnership operate as a consolidated company. Stockholders' equity, partners' capital and noncontrolling interest are the main areas of difference between the condensed consolidated financial statements of Essex and those of the Operating Partnership. The limited partners of the Operating Partnership are accounted for as partners' capital in the Operating Partnership's condensed consolidated financial statements and as noncontrolling interest in Essex’s condensed consolidated financial statements. The noncontrolling interest in the Operating Partnership's condensed consolidated financial statements include the interest of unaffiliated partners in various consolidated partnerships and co-investment partners. The noncontrolling interest in Essex's condensed consolidated financial statements include (i) the same noncontrolling interest as
iii


presented in the Operating Partnership’s condensed consolidated financial statements and (ii) OP Unitholders. The differences between stockholders' equity and partners' capital result from differences in the equity issued at Essex and Operating Partnership levels.
 
To help investors understand the significant differences between Essex and the Operating Partnership, this report on Form 10-Q provides separate condensed consolidated financial statements for Essex and the Operating Partnership; a single set of consolidated notes to such financial statements that includes separate discussions of stockholders' equity or partners' capital, and earnings per share/unit, as applicable; and a combined Management's Discussion and Analysis of Financial Condition and Results of Operations.

This report on Form 10-Q also includes separate Part I, Item 4. Controls and Procedures sections and separate Exhibits 31 and 32 certifications for each of Essex and the Operating Partnership in order to establish that the requisite certifications have been made and that Essex and the Operating Partnership are compliant with Rule 13a-15 or Rule 15d-15 of the Securities Exchange Act of 1934 (the "Exchange Act") and 18 U.S.C. §1350.

In order to highlight the differences between Essex and the Operating Partnership, the separate sections in this report on Form 10-Q for Essex and the Operating Partnership specifically refer to Essex and the Operating Partnership. In the sections that combine disclosure of Essex and the Operating Partnership, this report refers to actions or holdings as being actions or holdings of the Company. Although the Operating Partnership is generally the entity that directly or indirectly enters into contracts and co-investments and holds assets and debt, reference to the Company is appropriate because the Company is one business and the Company operates that business through the Operating Partnership. The separate discussions of Essex and the Operating Partnership in this report should be read in conjunction with each other to understand the results of the Company on a consolidated basis and how management operates the Company.

The information furnished in the accompanying unaudited condensed consolidated balance sheets, statements of income and comprehensive income, equity, capital, and cash flows of the Company and the Operating Partnership reflect all adjustments which are, in the opinion of management, necessary for a fair presentation of the aforementioned condensed consolidated financial statements for the interim periods and are normal and recurring in nature, except as otherwise noted.

The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the notes to such unaudited condensed consolidated financial statements and Management's Discussion and Analysis of Financial Condition and Results of Operations herein. Additionally, these unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Company's annual report on Form 10-K for the year ended December 31, 2020.
iv


ESSEX PROPERTY TRUST, INC.
ESSEX PORTFOLIO, L.P.
FORM 10-Q
TABLE OF CONTENTS

PART I. FINANCIAL INFORMATIONPage No.
Item 1.Condensed Consolidated Financial Statements of Essex Property Trust, Inc. (Unaudited)
 
 
 
 
 Condensed Consolidated Financial Statements of Essex Portfolio, L.P. (Unaudited) 
 
 
 
 
 
Item 2.
Item 3.
Item 4.
PART II. OTHER INFORMATION 
Item 1.
Item 1A.
Item 2.
Item 3.
Item 4.
Item 5.
Item 6.
1

Part I – Financial Information

Item 1. Condensed Consolidated Financial Statements
ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands, except parenthetical and share amounts)
ASSETSSeptember 30, 2021December 31, 2020
Real estate:
Rental properties:
Land and land improvements$2,997,904 $2,929,009 
Buildings and improvements12,414,770 12,132,736 
 15,412,674 15,061,745 
Less: accumulated depreciation(4,509,243)(4,133,959)
 10,903,431 10,927,786 
Real estate under development212,426 386,047 
Co-investments1,081,861 1,018,010 
Real estate held for sale 57,938 
12,197,718 12,389,781 
Cash and cash equivalents-unrestricted49,910 73,629 
Cash and cash equivalents-restricted11,042 10,412 
Marketable securities, net of allowance for credit losses of zero as of both September 30, 2021 and December 31, 2020
183,140 147,768 
Notes and other receivables, net of allowance for credit losses of $0.7 million and $0.8 million as of September 30, 2021 and December 31, 2020, respectively (includes related party receivables of $33.9 million and $4.7 million as of September 30, 2021 and December 31, 2020, respectively)
213,985 195,104 
Operating lease right-of-use assets69,756 72,143 
Prepaid expenses and other assets63,090 47,340 
Total assets$12,788,641 $12,936,177 
LIABILITIES AND EQUITY  
Unsecured debt, net$5,405,520 $5,607,985 
Mortgage notes payable, net640,118 643,550 
Lines of credit42,662  
Accounts payable and accrued liabilities220,428 152,855 
Construction payable32,777 31,417 
Dividends payable143,036 141,917 
Distributions in excess of investments in co-investments29,037  
Operating lease liabilities71,520 74,037 
Liabilities associated with real estate held for sale 29,845 
Other liabilities38,946 39,140 
Total liabilities6,624,044 6,720,746 
Commitments and contingencies
Redeemable noncontrolling interest32,698 32,239 
Equity:  
Common stock; $0.0001 par value, 670,000,000 shares authorized; 65,081,032 and 64,999,015 shares issued and outstanding, respectively
7 6 
Additional paid-in capital6,875,508 6,876,326 
Distributions in excess of accumulated earnings(917,315)(861,193)
Accumulated other comprehensive loss, net(8,968)(14,729)
Total stockholders' equity5,949,232 6,000,410 
Noncontrolling interest182,667 182,782 
Total equity6,131,899 6,183,192 
Total liabilities and equity$12,788,641 $12,936,177 

See accompanying notes to the unaudited condensed consolidated financial statements.
2

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Income and Comprehensive Income
(Unaudited)
(In thousands, except share and per share amounts)
 Three Months Ended September 30,Nine Months Ended September 30,
 2021202020212020
Revenues:
Rental and other property$360,620 $368,464 $1,062,253 $1,126,363 
Management and other fees from affiliates2,237 2,347 6,707 7,312 
 362,857 370,811 1,068,960 1,133,675 
Expenses:  
Property operating, excluding real estate taxes69,529 68,037 197,895 197,310 
Real estate taxes45,802 44,358 135,408 132,364 
Corporate-level property management expenses9,068 8,619 27,120 26,024 
Depreciation and amortization130,564 130,202 387,887 395,370 
General and administrative12,712 13,310 34,746 42,244 
Expensed acquisition and investment related costs108 2 164 104 
 267,783 264,528 783,220 793,416 
Gain on sale of real estate and land42,897 22,654 142,993 39,251 
Earnings from operations137,971 128,937 428,733 379,510 
Interest expense(50,019)(55,430)(152,639)(165,024)
Total return swap income2,660 2,977 8,137 7,749 
Interest and other income11,998 6,512 48,756 12,696 
Equity income from co-investments25,433 14,960 60,692 53,514 
Deferred tax expense on unrealized gain on unconsolidated co-investment(3,041) (5,391)(1,636)
Loss on early retirement of debt, net (19,114)(18,982)(23,820)
Gain on remeasurement of co-investment  2,260 234,694 
Net income125,002 78,842 371,566 497,683 
Net income attributable to noncontrolling interest(6,612)(5,181)(19,886)(24,558)
Net income available to common stockholders$118,390 $73,661 $351,680 $473,125 
Comprehensive income$125,829 $80,818 $377,529 $494,668 
Comprehensive income attributable to noncontrolling interest(6,639)(5,247)(20,088)(24,455)
Comprehensive income attributable to controlling interest$119,190 $75,571 $357,441 $470,213 
Per share data:  
Basic:  
Net income available to common stockholders$1.82 $1.13 $5.41 $7.22 
Weighted average number of shares outstanding during the period65,048,486 65,232,837 65,013,477 65,561,820 
Diluted:  
Net income available to common stockholders$1.82 $1.13 $5.40 $7.21 
Weighted average number of shares outstanding during the period65,147,781 65,241,428 65,075,174 65,676,093 

See accompanying notes to the unaudited condensed consolidated financial statements.
3

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Equity for the three and nine months ended September 30, 2021 and 2020
(Unaudited)
(In thousands)
 Common stockAdditional paid-in capitalDistributions
in excess of accumulated
earnings
Accumulated
other
comprehensive loss, net
Noncontrolling interestTotal
Three months ended September 30, 2021SharesAmount
Balances at June 30, 202165,004 $7 $6,862,879 $(899,663)$(9,768)$183,248 $6,136,703 
Net income— — — 118,390 — 6,612 125,002 
Change in fair value of derivatives and amortization of swap settlements— — — — 704 24 728 
Change in fair value of marketable debt securities, net— — — — 96 3 99 
Issuance of common stock under:      
Stock option and restricted stock plans, net68 — 15,572 — — — 15,572 
Sale of common stock, net— — (118)— — — (118)
Equity based compensation costs— — 1,573 — — 55 1,628 
Changes in the redemption value of redeemable noncontrolling interest— — 1,253 — — 420 1,673 
Distributions to noncontrolling interest— — — — — (7,257)(7,257)
Redemptions of noncontrolling interest9 — (5,651)— — (438)(6,089)
Common stock dividends ($2.09 per share)
— — — (136,042)— — (136,042)
Balances at September 30, 202165,081 $7 $6,875,508 $(917,315)$(8,968)$182,667 $6,131,899 

4

 Common stockAdditional paid-in capitalDistributions
in excess of accumulated
earnings
Accumulated
other
comprehensive loss, net
Noncontrolling interestTotal
Nine months ended September 30, 2021SharesAmount
Balances at December 31, 202064,999 $6 $6,876,326 $(861,193)$(14,729)$182,782 $6,183,192 
Net income— — — 351,680 — 19,886 371,566 
Change in fair value of derivatives and amortization of swap settlements— — — — 5,417 190 5,607 
Change in fair value of marketable debt securities, net— — — — 344 12 356 
Issuance of common stock under:
Stock option and restricted stock plans, net112 1 12,401 — — — 12,402 
Sale of common stock, net— — (202)— — — (202)
Equity based compensation costs— — 9,172 — — 323 9,495 
Retirement of common stock, net(40)— (9,172)— — — (9,172)
Changes in the redemption value of redeemable noncontrolling interest— — (5,499)— — 577 (4,922)
Contributions from noncontrolling interest— — — — — 1,900 1,900 
Distributions to noncontrolling interest— — — — — (22,114)(22,114)
Redemptions of noncontrolling interest10 — (7,518)— — (889)(8,407)
Common stock dividends ($6.27 per share)
— — — (407,802)— — (407,802)
Balances at September 30, 202165,081 $7 $6,875,508 $(917,315)$(8,968)$182,667 $6,131,899 
5

 Common stockAdditional paid-in capitalDistributions
in excess of accumulated
earnings
Accumulated
other
comprehensive loss, net
Noncontrolling InterestTotal
Three months ended September 30, 2020SharesAmount
Balances at June 30, 202065,331 $7 $6,944,805 $(760,028)$(18,710)$186,807 $6,352,881 
Net income— — — 73,661 — 5,181 78,842 
Change in fair value of derivatives and amortization of swap settlements— — — — 1,821 63 1,884 
Change in fair value of marketable debt securities, net— — — — 89 3 92 
Issuance of common stock under:      
Sale of common stock, net— — (95)— — — (95)
Equity based compensation costs— — 2,279 — — 82 2,361 
Retirement of common stock, net(121)— (26,586)— — — (26,586)
Changes in the redemption value of redeemable noncontrolling interest— — 2,346 — — 176 2,522 
Distributions to noncontrolling interest— — — — — (7,677)(7,677)
Redemptions of noncontrolling interest— — (1,118)— — (150)(1,268)
Common stock dividends ($2.0775 per share)
— — — (135,474)— — (135,474)
Balances at September 30, 202065,210 $7 $6,921,631 $(821,841)$(16,800)$184,485 $6,267,482 
6

 Common stockAdditional paid-in capitalDistributions
in excess of accumulated
earnings
Accumulated
other
comprehensive loss, net
Noncontrolling InterestTotal
Nine months ended September 30, 2020SharesAmount
Balances at December 31, 201966,092 $7 $7,121,927 $(887,619)$(13,888)$183,077 $6,403,504 
Net income— — — 473,125 — 24,558 497,683 
Cash flow hedge losses reclassified to earnings— — — — 3,171 111 3,282 
Change in fair value of derivatives and amortization of swap settlements— — — — (5,911)(208)(6,119)
Change in fair value of marketable debt securities, net— — — — (172)(6)(178)
Issuance of common stock under:
Stock option and restricted stock plans, net95 — 9,201 — — — 9,201 
Sale of common stock, net— — (228)— — — (228)
Equity based compensation costs— — 8,956 — — 338 9,294 
Retirement of common stock, net(985)— (222,990)— — — (222,990)
Cumulative effect upon adoption of ASU No. 2016-13
— — — (190)— — (190)
Changes in the redemption value of redeemable noncontrolling interest— — 6,888 — — (197)6,691 
Changes in noncontrolling interest from acquisition— — — — — 1,349 1,349 
Distributions to noncontrolling interest— — — — — (23,689)(23,689)
Redemptions of noncontrolling interest8 — (2,123)— — (848)(2,971)
Common stock dividends ($6.2325 per share)
— — — (407,157)— — (407,157)
Balances at September 30, 202065,210 $7 $6,921,631 $(821,841)$(16,800)$184,485 $6,267,482 

See accompanying notes to the unaudited condensed consolidated financial statements.
7

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In thousands, except parenthetical amounts) 
 Nine Months Ended September 30,
 20212020
Cash flows from operating activities:
Net income$371,566 $497,683 
Adjustments to reconcile net income to net cash provided by operating activities:  
Straight-lined rents8,734 (15,485)
Depreciation and amortization387,887 395,370 
Amortization of discount on marketable securities (6,598)
Amortization of discount and debt financing costs, net7,987 5,177 
Gain on sale of marketable securities(2,499)(124)
Income from early redemption of notes receivable(4,747) 
Provision for credit losses(110)100 
Unrealized gains on equity securities recognized through income(23,772)(2,215)
Earnings from co-investments(60,692)(53,514)
Operating distributions from co-investments78,360 41,202 
Accrued interest from notes and other receivables(12,253)(1,574)
Gain on the sale of real estate and land(142,993)(39,251)
Equity-based compensation5,399 4,923 
Loss on early retirement of debt, net18,982 23,820 
Gain on remeasurement of co-investment(2,260)(234,694)
Changes in operating assets and liabilities: 
Prepaid expenses, receivables, operating lease right-of-use assets, and other assets2,470 (5,088)
Accounts payable, accrued liabilities, and operating lease liabilities62,699 43,095 
Other liabilities5,119 610 
Net cash provided by operating activities699,877 653,437 
Cash flows from investing activities:  
Additions to real estate:  
Acquisitions of real estate and acquisition related capital expenditures, net of cash acquired(105,469)(459,355)
Redevelopment(39,092)(41,592)
Development acquisitions of and additions to real estate under development(45,381)(90,273)
Capital expenditures on rental properties(81,063)(64,269)
Investments in notes receivable(102,012)(20,431)
Collections of notes and other receivables88,744 98,711 
Proceeds from insurance for property losses591 612 
Proceeds from dispositions of real estate297,454 280,246 
Contributions to co-investments(223,175)(61,056)
Changes in refundable deposits(8,356)96 
Purchases of marketable securities(23,740)(38,909)
Sales and maturities of marketable securities14,995 56,890 
Non-operating distributions from co-investments131,297 37,342 
Net cash used in investing activities(95,207)(301,988)
Cash flows from financing activities:  
Proceeds from unsecured debt and mortgage notes745,505 1,452,808 
Payments on unsecured debt and mortgage notes(952,608)(587,057)
Proceeds from lines of credit601,435 1,038,426 
Repayments of lines of credit(558,773)(1,093,426)
Retirement of common stock(9,172)(222,990)
8

 Nine Months Ended September 30,
 20212020
Additions to deferred charges(8,237)(13,761)
Payments related to debt prepayment penalties(18,342)(19,605)
Net proceeds from issuance of common stock(202)(228)
Net proceeds from stock options exercised17,847 14,865 
Payments related to tax withholding for share-based compensation(5,445)(5,664)
Contributions from noncontrolling interest1,900  
Distributions to noncontrolling interest(21,979)(23,302)
Redemption of noncontrolling interest(8,407)(2,971)
Redemption of redeemable noncontrolling interest(4,463) 
Common stock dividends paid(406,818)