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Reportable Segments | 9 Months Ended
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Sep. 30, 2021
Segment Reporting [Abstract] |
Reportable Segments |
1 3. | Reportable Segments
Operating segments are defined as components of an enterprise that engage in business activities from which they may earn revenues and incur expenses and about which discrete financial information is available that is evaluated regularly by the chief operating decision maker. The chief operating decision maker decides how resources are allocated and assesses performance on a recurring basis at least quarterly. The Company’s primary business is the acquisition, development and management of multifamily residential properties, which includes the generation of rental and other related income through the leasing of apartment units to residents. The chief operating decision maker evaluates the Company’s operating performance geographically by market and both on a same store and non-same store basis. While the Company does maintain a non-residential presence, it accounts for approximately 3.8% of total revenues for the nine months ended September 30, 2021 and is designed as an amenity for our residential residents. The chief operating decision maker evaluates the performance of each property on a consolidated residential and non-residential basis. The Company’s geographic consolidated same store operating segments represent its reportable segments. The Company’s development activities are other business activities that do not constitute an operating segment and as such, have been aggregated in the “Other” category in the tables presented below. All revenues are from external customers and there is no customer who contributed 10% or more of the Company’s total revenues during the nine months and quarters ended September 30, 2021 and 2020, respectively. The primary financial measure for the Company’s rental real estate segment is net operating income (“NOI”), which represents rental income less: 1) property and maintenance expense and 2) real estate taxes and insurance expense (all as reflected in the accompanying consolidated statements of operations and comprehensive income). The Company believes that NOI is helpful to investors as a supplemental measure of its operating performance because it is a direct measure of the actual operating results of the Company’s apartment properties. Revenues for all leases are reflected on a straight-line basis in accordance with GAAP for the current and comparable periods. The following table presents a reconciliation of NOI from our rental real estate for the nine months and quarters ended September 30, 2021 and 2020, respectively (amounts in thousands):
|  | Nine Months Ended September 30, |  |  | Quarter Ended September 30, |
|  | 2021 |  |  | 2020 |  |  | 2021 |  |  | 2020 |
Rental income |  | $ | 1,818,867 |  |  | $ | 1,958,270 |  |  | $ | 623,206 |  |  | $ | 622,433 |
Property and maintenance expense |  |  | (341,261 | ) |  |  | (333,333 | ) |  |  | (116,461 | ) |  |  | (113,065 | )
Real estate taxes and insurance expense |  |  | (297,780 | ) |  |  | (288,043 | ) |  |  | (96,909 | ) |  |  | (95,273 | )
Total operating expenses |  |  | (639,041 | ) |  |  | (621,376 | ) |  |  | (213,370 | ) |  |  | (208,338 | )
Net operating income |  | $ | 1,179,826 |  |  | $ | 1,336,894 |  |  | $ | 409,836 |  |  | $ | 414,095 |
The following tables present NOI for each segment from our rental real estate for the nine months and quarters ended September 30, 2021 and 2020, respectively, as well as total assets and capital expenditures at September 30, 2021 (amounts in thousands):
|  | Nine Months Ended September 30, 2021 |  |  | Nine Months Ended September 30, 2020 |
|  | Rental Income |  |  | Operating Expenses |  |  | NOI |  |  | Rental Income |  |  | Operating Expenses |  |  | NOI |
Same store (1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Los Angeles |  | $ | 337,153 |  |  | $ | 109,997 |  |  | $ | 227,156 |  |  | $ | 346,599 |  |  | $ | 108,594 |  |  | $ | 238,005 |
Orange County |  |  | 80,773 |  |  |  | 18,937 |  |  |  | 61,836 |  |  |  | 79,241 |  |  |  | 18,539 |  |  |  | 60,702 |
San Diego |  |  | 58,211 |  |  |  | 13,920 |  |  |  | 44,291 |  |  |  | 56,001 |  |  |  | 13,684 |  |  |  | 42,317 |
Subtotal - Southern California |  |  | 476,137 |  |  |  | 142,854 |  |  |  | 333,283 |  |  |  | 481,841 |  |  |  | 140,817 |  |  |  | 341,024 |
San Francisco |  |  | 302,043 |  |  |  | 93,983 |  |  |  | 208,060 |  |  |  | 346,089 |  |  |  | 90,849 |  |  |  | 255,240 |
Washington D.C. |  |  | 298,165 |  |  |  | 99,369 |  |  |  | 198,796 |  |  |  | 311,119 |  |  |  | 95,799 |  |  |  | 215,320 |
New York |  |  | 299,320 |  |  |  | 152,228 |  |  |  | 147,092 |  |  |  | 324,866 |  |  |  | 148,145 |  |  |  | 176,721 |
Seattle |  |  | 181,908 |  |  |  | 58,616 |  |  |  | 123,292 |  |  |  | 195,198 |  |  |  | 55,845 |  |  |  | 139,353 |
Boston |  |  | 171,871 |  |  |  | 57,041 |  |  |  | 114,830 |  |  |  | 182,502 |  |  |  | 53,727 |  |  |  | 128,775 |
Denver |  |  | 28,732 |  |  |  | 8,614 |  |  |  | 20,118 |  |  |  | 28,584 |  |  |  | 8,320 |  |  |  | 20,264 |
Total same store |  |  | 1,758,176 |  |  |  | 612,705 |  |  |  | 1,145,471 |  |  |  | 1,870,199 |  |  |  | 593,502 |  |  |  | 1,276,697 |
Non-same store/other (2) (3) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Non-same store |  |  | 28,581 |  |  |  | 10,916 |  |  |  | 17,665 |  |  |  | 11,440 |  |  |  | 2,534 |  |  |  | 8,906 |
Other (3) |  |  | 32,110 |  |  |  | 15,420 |  |  |  | 16,690 |  |  |  | 76,631 |  |  |  | 25,340 |  |  |  | 51,291 |
Total non-same store/other |  |  | 60,691 |  |  |  | 26,336 |  |  |  | 34,355 |  |  |  | 88,071 |  |  |  | 27,874 |  |  |  | 60,197 |
Totals |  | $ | 1,818,867 |  |  | $ | 639,041 |  |  | $ | 1,179,826 |  |  | $ | 1,958,270 |  |  | $ | 621,376 |  |  | $ | 1,336,894 |
(1) | For the nine months ended September 30, 2021 and 2020, same store primarily includes all properties acquired or completed that were stabilized prior to January 1, 2020, less properties subsequently sold, which represented 75,288 apartment units.
(2) | For the nine months ended September 30, 2021 and 2020, non-same store primarily includes properties acquired after January 1, 2020, plus any properties in lease-up and not stabilized as of January 1, 2020.
(3) | Other includes development, other corporate operations and operations prior to disposition for properties sold.
|  | Quarter Ended September 30, 2021 |  |  | Quarter Ended September 30, 2020 |
|  | Rental Income |  |  | Operating Expenses |  |  | NOI |  |  | Rental Income |  |  | Operating Expenses |  |  | NOI |
Same store (1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Los Angeles |  | $ | 117,542 |  |  | $ | 36,929 |  |  | $ | 80,613 |  |  | $ | 112,201 |  |  | $ | 36,783 |  |  | $ | 75,418 |
Orange County |  |  | 28,264 |  |  |  | 6,480 |  |  |  | 21,784 |  |  |  | 26,229 |  |  |  | 6,457 |  |  |  | 19,772 |
San Diego |  |  | 20,282 |  |  |  | 4,735 |  |  |  | 15,547 |  |  |  | 18,637 |  |  |  | 4,652 |  |  |  | 13,985 |
Subtotal - Southern California |  |  | 166,088 |  |  |  | 48,144 |  |  |  | 117,944 |  |  |  | 157,067 |  |  |  | 47,892 |  |  |  | 109,175 |
San Francisco |  |  | 102,166 |  |  |  | 31,542 |  |  |  | 70,624 |  |  |  | 109,908 |  |  |  | 30,913 |  |  |  | 78,995 |
Washington D.C. |  |  | 100,019 |  |  |  | 34,397 |  |  |  | 65,622 |  |  |  | 103,160 |  |  |  | 32,979 |  |  |  | 70,181 |
New York |  |  | 103,015 |  |  |  | 49,939 |  |  |  | 53,076 |  |  |  | 98,333 |  |  |  | 49,915 |  |  |  | 48,418 |
Seattle |  |  | 61,888 |  |  |  | 20,117 |  |  |  | 41,771 |  |  |  | 62,748 |  |  |  | 18,972 |  |  |  | 43,776 |
Boston |  |  | 58,864 |  |  |  | 19,504 |  |  |  | 39,360 |  |  |  | 59,527 |  |  |  | 18,601 |  |  |  | 40,926 |
Denver |  |  | 9,812 |  |  |  | 2,940 |  |  |  | 6,872 |  |  |  | 9,509 |  |  |  | 2,892 |  |  |  | 6,617 |
Total same store |  |  | 601,852 |  |  |  | 206,583 |  |  |  | 395,269 |  |  |  | 600,252 |  |  |  | 202,164 |  |  |  | 398,088 |
Non-same store/other (2) (3) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Non-same store |  |  | 16,563 |  |  |  | 6,777 |  |  |  | 9,786 |  |  |  | 2,481 |  |  |  | 539 |  |  |  | 1,942 |
Other (3) |  |  | 4,791 |  |  |  | 10 |  |  |  | 4,781 |  |  |  | 19,700 |  |  |  | 5,635 |  |  |  | 14,065 |
Total non-same store/other |  |  | 21,354 |  |  |  | 6,787 |  |  |  | 14,567 |  |  |  | 22,181 |  |  |  | 6,174 |  |  |  | 16,007 |
Totals |  | $ | 623,206 |  |  | $ | 213,370 |  |  | $ | 409,836 |  |  | $ | 622,433 |  |  | $ | 208,338 |  |  | $ | 414,095 |
(1) | For the quarters ended September 30, 2021 and 2020, same store primarily includes all properties acquired or completed that were stabilized prior to July 1, 2020, less properties subsequently sold, which represented 75,509 apartment units.
(2) | For the quarters ended September 30, 2021 and 2020, non-same store primarily includes properties acquired a fter July 1, 20 20, plus any properties in lease-u p and not stabilized as of July 1, 20 20.
(3) | Other includes development, other corporate operations and operations prior to disposition for properties sold.
|  | Nine Months Ended September 30, 2021 |
|  | Total Assets |  |  | Capital Expenditures |
Same store (1) |  |  |  |  |  |  |  |
Los Angeles |  | $ | 2,926,617 |  |  | $ | 13,959 |
Orange County |  |  | 375,365 |  |  |  | 4,124 |
San Diego |  |  | 234,733 |  |  |  | 2,060 |
Subtotal - Southern California |  |  | 3,536,715 |  |  |  | 20,143 |
San Francisco |  |  | 3,264,017 |  |  |  | 15,853 |
Washington D.C. |  |  | 3,270,172 |  |  |  | 20,392 |
New York |  |  | 3,902,715 |  |  |  | 22,641 |
Seattle |  |  | 1,975,574 |  |  |  | 10,234 |
Boston |  |  | 1,710,489 |  |  |  | 15,766 |
Denver |  |  | 496,969 |  |  |  | 1,101 |
Total same store |  |  | 18,156,651 |  |  |  | 106,130 |
Non-same store/other (2) (3) |  |  |  |  |  |  |  |
Non-same store |  |  | 1,484,091 |  |  |  | 659 |
Other (3) |  |  | 1,022,273 |  |  |  | 917 |
Total non-same store/other |  |  | 2,506,364 |  |  |  | 1,576 |
Totals |  | $ | 20,663,015 |  |  | $ | 107,706 |
(1) | Same store primarily includes all properties acquired or completed that were stabilized prior to January 1, 2020, less properties subsequently sold, which represented 75,288 apartment units.
(2) | Non-same store primarily includes properties acquired after January 1, 2020, plus any properties in lease-up and not stabilized as of January 1, 2020.
(3) | Other includes development, other corporate operations and capital expenditures for properties sold.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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