XML 23 R14.htm IDEA: XBRL DOCUMENT v3.22.2
Segment Reporting
 6 Months Ended
Jun. 30, 2022
Segment Reporting [Abstract]  
Segment Reporting Segment Reporting
The Company's reportable operating segments include Same Store, Other Stabilized and Development/Redevelopment. Annually as of January 1, the Company determines which of its communities fall into each of these categories and generally maintains that classification throughout the year for the purpose of reporting segment operations, unless disposition or redevelopment plans regarding a community change. In addition, the Company owns land for future development and has other corporate assets that are not allocated to an operating segment.

The Company's segment disclosures present the measure(s) used by the chief operating decision maker ("CODM") for assessing each segment's performance. The Company's CODM is comprised of several members of its executive management team who use net operating income ("NOI") as the primary financial measure for Same Store communities and Other Stabilized communities. NOI is defined by the Company as total property revenue less direct property operating expenses (including property taxes), and excluding corporate-level income (including management, development and other fees), corporate-level property management and other indirect operating expenses, expensed transaction, development and other pursuit costs, net of recoveries, interest expense, net, gain on extinguishment of debt, net, general and administrative expense, income from investments in unconsolidated entities, depreciation expense, income tax (benefit) expense, casualty and impairment loss, gain on sale of communities, gain on other real estate transactions, net, net for-sale condominium activity and net operating income from real estate assets sold or held for sale. The CODM evaluates the Company's financial performance on a consolidated residential and commercial basis. The commercial results attributable to the non-apartment components of the Company's mixed-use communities and other nonresidential operations represent 1.7% and 1.6% of total NOI for the three months ended June 30, 2022 and 2021, respectively, and 1.9% and 1.5% for the six months ended June 30, 2022 and 2021, respectively. Although the Company considers NOI a useful measure of a community's or communities' operating performance, NOI should not be considered an alternative to net income or net cash flow from operating activities, as determined in accordance with GAAP. NOI excludes a number of income and expense categories as detailed in the reconciliation of NOI to net income.

A reconciliation of NOI to net income for the three and six months ended June 30, 2022 and 2021 is as follows (dollars in thousands):
 For the three months endedFor the six months ended
 6/30/20226/30/20216/30/20226/30/2021
Net income $138,566 $447,977 $400,642 $590,211 
Property management and other indirect operating expenses, net of corporate income30,632 24,318 58,745 48,788 
Expensed transaction, development and other pursuit costs, net of recoveries2,364 1,653 3,351 1,483 
Interest expense, net 58,797 56,104 115,323 108,717 
Gain on extinguishment of debt, net— — — (122)
General and administrative expense21,291 18,465 38,712 35,817 
Income from investments in unconsolidated entities(2,480)(26,559)(2,797)(26,092)
Depreciation expense199,302 184,472 401,088 367,769 
Income tax (benefit) expense(159)10 2,312 (745)
Casualty and impairment loss— 1,177 — 1,177 
Gain on sale of communities(404)(334,569)(149,204)(388,296)
Gain on other real estate transactions, net(43)(32)(80)(459)
Net for-sale condominium activity71 647 (165)1,560 
Net operating income from real estate assets sold or held for sale (3,650)(13,893)(8,916)(28,472)
        Net operating income$444,287 $359,770 $859,011 $711,336 
The following is a summary of NOI from real estate assets sold or held for sale for the periods presented (dollars in thousands):
For the three months endedFor the six months ended
6/30/20226/30/20216/30/20226/30/2021
Rental income from real estate assets sold or held for sale$5,699 $22,887 $14,510 $47,165 
Operating expenses from real estate assets sold or held for sale(2,049)(8,994)(5,594)(18,693)
Net operating income from real estate assets sold or held for sale$3,650 $13,893 $8,916 $28,472 

The primary performance measure for communities under development or redevelopment depends on the stage of completion. While under development, management monitors actual construction costs against budgeted costs as well as lease-up pace and rent levels compared to budget.

The following table details the Company's segment information as of the dates specified (dollars in thousands). The segments are classified based on the individual community's status at January 1, 2022. Segment information for the three and six months ended June 30, 2022 and 2021 has been adjusted to exclude the real estate assets that were sold from January 1, 2021 through June 30, 2022, or otherwise qualify as held for sale as of June 30, 2022, as described in Note 6, "Real Estate Disposition Activities."
 For the three months endedFor the six months ended
 Total
revenue		NOITotal
revenue		NOIGross real estate (1)
For the period ended June 30, 2022 
Same Store   
New England$85,966 $57,413 $167,783 $110,000 $2,897,758 
Metro NY/NJ114,791 80,041 224,674 155,980 4,099,129 
Mid-Atlantic85,191 57,944 167,284 113,936 3,264,662 
Southeast Florida9,439 6,171 18,510 12,148 397,445 
Denver, CO6,663 4,900 12,978 9,627 321,043 
Pacific Northwest36,310 26,101 70,608 50,323 1,292,648 
Northern California100,487 72,072 197,216 140,771 3,661,197 
Southern California129,329 92,204 250,370 176,921 4,421,423 
Total Same Store568,176 396,846 1,109,423 769,706 20,355,305 
Other Stabilized48,708 33,269 94,308 62,811 2,583,348 
Development / Redevelopment21,072 14,172 38,589 26,494 1,910,921 
Land Held for DevelopmentN/AN/AN/AN/A194,458 
Non-allocated (2)904 N/A1,656 N/A190,301 
Total$638,860 $444,287 $1,243,976 $859,011 $25,234,333 
For the period ended June 30, 2021 
Same Store   
New England$76,028 $49,292 $150,899 $96,738 $2,866,866 
Metro NY/NJ101,709 68,865 203,312 138,806 4,064,542 
Mid-Atlantic79,090 52,583 157,194 105,634 3,237,943 
Southeast Florida7,706 4,557 14,948 8,746 395,009 
Denver, CO5,853 3,935 11,505 7,954 319,994 
Pacific Northwest31,035 21,024 61,567 41,414 1,284,135 
Northern California92,080 65,022 184,935 130,574 3,620,936 
Southern California108,710 73,364 215,801 145,899 4,373,247 
Total Same Store502,211 338,642 1,000,161 675,765 20,162,672 
Other Stabilized26,886 16,326 47,844 27,298 1,806,053 
Development / Redevelopment8,951 4,802 16,024 8,273 1,261,434 
Land Held for DevelopmentN/AN/AN/AN/A100,106 
Non-allocated (2)808 N/A1,685 N/A322,576 
Total$538,856 $359,770 $1,065,714 $711,336 $23,652,841 
__________________________________
(1)Does not include gross real estate assets held for sale of $152,391 as of June 30, 2022 and gross real estate either sold or classified as held for sale subsequent to June 30, 2021 of $398,960.
(2)Revenue represents third-party management, accounting, and developer fees and miscellaneous income and other ancillary items which are not allocated to a reportable segment. Gross real estate includes the for-sale residential condominiums at The Park Loggia, as discussed in Note 6, "Real Estate Disposition Activities."