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Share-Based Compensation
 12 Months Ended
Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]  
Share-Based Compensation Share-Based Compensation
2021 Equity Incentive Plan

During the second quarter of 2021, the Company’s shareholders approved and the Company adopted the 2021 Equity Incentive Plan (the “2021 Plan”). The 2021 Plan replaced the 2012 Equity Incentive Plan (the “2012 Plan”) and provides for the issuance of up to 9,544,095 Class A common shares (including shares that remained available for future awards under the 2012 Plan as of the effective date of the 2021 Plan and shares related to outstanding awards under the 2012 Plan that may become available after expiration, forfeiture or cancellation of such awards). The 2021 Plan provides for the issuance of Class A common shares through the grant of a variety of awards including stock options, stock appreciation rights, RSUs, unrestricted shares, dividend equivalent rights and performance-based awards. The 2021 Plan terminates in May 2031, unless terminated earlier by the Company’s board of trustees. When the Company issues Class A common shares under the 2021 Plan, the Operating Partnership issues an equivalent number of Class A units to AMH.
During the years ended December 31, 2022, 2021 and 2020, employees were granted RSUs that vest over a one- to three-year service period and non-management trustees were granted RSUs that vest over a one-year service period. Options expire 10 years from the date of grant.

During the years ended December 31, 2022 and 2021, certain senior employees were granted PSUs that cliff vest at the end of a three-year service period. The performance conditions of the PSUs are measured over the three-year performance period January 1, 2022 through December 31, 2024 for PSUs granted during the year ended December 31, 2022 and January 1, 2021 through December 31, 2023 for PSUs granted during the year ended December 31, 2021. A portion of the PSUs are based on (i) the achievement of relative total shareholder return compared to a specified peer group (the “TSR Awards”), and a portion are based on (ii) average annual growth in core funds from operations per share (the “Core FFO Awards”). The number of PSUs that may ultimately vest range from zero to 200% of the number of PSUs granted based on the level of achievement of these performance conditions. For the TSR Awards, grant date fair value was determined using a multifactor Monte Carlo model and the resulting compensation cost is amortized over the service period regardless of whether the performance condition is achieved. For the Core FFO Awards, fair value is based on the market value on the date of grant and compensation cost is recognized based on the probable achievement of the performance condition at each reporting period.

The 2012 Plan and 2021 Plan allow for continued release of awards based on the original vesting schedule, rather than forfeiture, of unvested share-based grants upon termination of service for employees who meet certain retirement eligibility criteria, including age and years of service. Retirement eligible employees must also provide a notice of intent to retire at least six months prior to retirement date and the HCC Committee must approve the continued release of awards.

The following table summarizes stock option activity under the 2012 Plan and 2021 Plan for the years ended December 31, 2022, 2021 and 2020:
 SharesWeighted-Average Exercise PriceWeighted-Average Remaining Contractual Life (in years)
Aggregate Intrinsic Value (1) (amounts in thousands)
Options outstanding at December 31, 20191,529,800 $17.40 5.3$13,479 
Granted— — 
Exercised(426,150)16.55 4,911 
Forfeited(13,350)21.89 
Options outstanding at December 31, 20201,090,300 $17.68 4.5$13,436 
Granted— — 
Exercised(266,000)17.01 5,625 
Forfeited— — 
Options outstanding at December 31, 2021824,300 $17.89 3.7$21,200 
Granted— — 
Exercised(93,750)17.26 1,782 
Forfeited— — 
Options outstanding at December 31, 2022730,550 $17.97 3.0$8,889 
Options exercisable at December 31, 2022725,550 $17.96 3.0$8,841 
(1)Intrinsic value for activities other than exercises is defined as the difference between the grant price and the market value on the last trading day of the period for those stock options where the market value is greater than the grant price. For exercises, intrinsic value is defined as the difference between the grant price and the market value on the date of exercise.
The following table summarizes RSU activity under the 2012 Plan and 2021 Plan for the years ended December 31, 2022, 2021 and 2020:
Restricted Share UnitsWeighted- Average Grant Date Fair Value
RSUs outstanding at December 31, 2019
599,109 $21.71 
Awarded470,147 27.38 
Vested(316,186)23.61 
Forfeited(101,533)23.93 
RSUs outstanding at December 31, 2020
651,537 $24.53 
Awarded651,898 32.69 
Vested(209,824)23.15 
Forfeited(43,012)28.41 
RSUs outstanding at December 31, 2021
1,050,599 $29.71 
Awarded466,802 39.52 
Vested(439,643)29.41 
Forfeited(53,036)35.85 
RSUs outstanding at December 31, 2022
1,024,722 $33.99 

The following table summarizes PSU activity under the 2012 Plan and 2021 Plan for the years ended December 31, 2022 and 2021:
Performance-Based Restricted Share Units Weighted-Average Grant Date Fair Value
PSUs outstanding at December 31, 2020— $— 
Awarded92,319 34.83 
Vested— — 
Forfeited— — 
PSUs outstanding at December 31, 2021
92,319 $34.83 
Awarded202,104 43.91 
Vested— — 
Forfeited— — 
PSUs outstanding at December 31, 2022
294,423 $41.07 

For the TSR Awards, the following assumptions were used in the calculation of fair value using the Monte Carlo simulation model:
20222021
Expected term (years)3.03.0
Dividend yield1.03%0.67%
Estimated volatility (1)
27.62%28.48%
Risk-free interest rate1.39%0.2%
(1)Estimated volatility for the performance period is based on 50% historical volatility and 50% implied volatility.

2021 Employee Stock Purchase Plan

During the second quarter of 2021, the Company’s shareholders approved and the Company adopted the 2021 Employee Stock Purchase Plan (the “2021 ESPP”), which provides for the issuance of 3,000,000 Class A common shares. The 2021 ESPP terminates in June 2031 or the date on which there are no longer any Class A common shares available for issuance. The 2021 ESPP allows employees to acquire the Company’s Class A common shares through payroll deductions, subject to maximum purchase limitations, during six-month purchase periods. The purchase price for Class A common shares may be set at a maximum discount equal to 85% of the lower of the closing price of the Company’s Class A common shares on the first day or the last day of the applicable purchase period. When the Company issues Class A common shares under the 2021 ESPP, the Operating Partnership issues an equivalent number of Class A units to AMH.
Share-Based Compensation Expense

The Company’s noncash share-based compensation expense relating to corporate administrative employees is included in general and administrative expense and the noncash share-based compensation expense relating to centralized and field property management employees is included in property management expenses. Noncash share-based compensation expense relating to employees involved in the purchases of single-family properties, including newly constructed properties from third-party builders, the development of single-family properties, or the disposal of certain properties or portfolios of properties is included in acquisition and other transaction costs. The following table summarizes the activity related to the Company’s noncash share-based compensation expense for the years ended December 31, 2022, 2021 and 2020 (amounts in thousands):
For the Years Ended December 31,
202220212020
General and administrative expense$15,318 $9,361 $6,573 
Property management expenses3,861 3,004 1,745 
Acquisition and other transaction costs8,129 5,427 1,516 
Total noncash share-based compensation expense$27,308 $17,792 $9,834 

As of December 31, 2022, the unrecognized compensation expense for unvested RSUs and PSUs was $14.9 million and $5.0 million, respectively. The unrecognized compensation expense for unvested RSUs and PSUs is expected to be recognized over a weighted-average period of 1.4 years and 1.8 years, respectively.