Equity Residential Reports Third Quarter 2020 Results

Rhea-AI Summary

Equity Residential (NYSE: EQR) reported its Q3 2020 results with earnings per share (EPS) at $0.24, down 66.2% from $0.71 in Q3 2019. Funds from Operations (FFO) per share fell 17.4% to $0.76. Urban properties remain particularly challenged, with occupancy rates declining significantly due to pandemic impacts. The company collected approximately 97% of expected residential revenues and reduced total debt by over $600 million. Looking ahead, financial results are expected to weaken further as pandemic effects persist.

Positive

• Collected approximately 97% of expected residential revenues in Q3 2020.
• Maintained strong balance sheet with over $600 million debt reduction in 2020.

Negative

• EPS down 66.2% year-over-year to $0.24.
• FFO per share decreased 17.4% from $0.92 to $0.76.
• Urban portfolio occupancy declined significantly, leading to lower rental rates.

CHICAGO--(BUSINESS WIRE)--Equity Residential (NYSE: EQR) today reported results for the quarter and nine months ended September 30, 2020.

Third Quarter 2020 Results

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

			Quarter Ended September 30,
			2020				2019				$ Change				% Change
	Earnings Per Share (EPS)		$	0.24			$	0.71			$	(0.47	)			(66.2	%)
	Funds from Operations (FFO) per share		$	0.76			$	0.92			$	(0.16	)			(17.4	%)
	Normalized FFO per share		$	0.77			$	0.91			$	(0.14	)			(15.4	%)

			Nine Months Ended September 30,
			2020				2019				$ Change				% Change
	Earnings Per Share (EPS)		$	1.77			$	1.82			$	(0.05	)			(2.7	%)
	Funds from Operations (FFO) per share		$	2.48			$	2.53			$	(0.05	)			(2.0	%)
	Normalized FFO per share		$	2.49			$	2.58			$	(0.09	)			(3.5	%)

"Operating results in the quarter were challenging and widely varying. Our suburban portfolio continues to fare relatively well with occupancy similar to last year, rates down only modestly and recovery under way in some markets. However, the approximately 23% of our portfolio located in the urban cores of New York, San Francisco and Boston continues to struggle with pandemic-related reductions in economic activity, which have led to declines in occupancy, lower resident renewal levels and a related drop in rental rates. While we have seen recent improvements in renewals and application volume, pricing pressures continue and headwinds remain," said Mark J. Parrell, Equity Residential's President and CEO.

"We anticipate that our financial results will weaken over subsequent quarters as the full effect of the pandemic is felt on our business. Looking longer term, we expect that positive developments relating to the pandemic will eventually re-energize the urban centers which have persevered and thrived through many decades and in similarly challenging circumstances. We continue to see the urban locations in our markets as centers of our country’s knowledge industries and expect them to again attract disproportionate numbers of affluent renters once the pandemic ends. Many thanks to my colleagues at our properties and offices across the country for their hard work and dedication in these difficult times."

Highlights

• The Company collected approximately 97% of its expected Residential revenues in the third quarter of 2020; and
• The Company’s balance sheet and liquidity position remains exceptionally strong, having reduced its total debt by over $600 million during 2020 using proceeds from property dispositions.

Results Per Share

The change in EPS for the quarter ended September 30, 2020 compared to the same period of 2019 is due primarily to lower property sale gains in the third quarter of 2020, the various adjustment items listed on page 25 of this release and the items described below. The change in EPS for the nine months ended September 30, 2020 compared to the same period of 2019 is due primarily to the various adjustment items listed on page 25 of this release and the items described below.

The per share changes in FFO for both the quarter and nine months ended September 30, 2020 compared to the same periods of 2019, are due primarily to the various adjustment items listed on page 25 of this release and the items described below.

The per share changes in Normalized FFO are due primarily to:

		Positive/(Negative) Impact
		Third Quarter 2020 vs. Third Quarter 2019				September YTD 2020 vs. September YTD 2019
Residential same store Net Operating Income (NOI)		$	(0.09	)		$	(0.07	)
Non-Residential same store NOI (1)			(0.05	)			(0.07	)
Lease-Up NOI		–					0.01
2020 and 2019 transaction activity impact on NOI, net			(0.03	)			(0.03	)
Interest expense			0.03				0.08
Other items		–					(0.01	)
Net		$	(0.14	)		$	(0.09	)

(1)	Non-Residential same store NOI was negatively impacted by a $(0.03) per share non-cash write-off of Non-Residential straight-line lease receivables during the third quarter of 2020 and nine months ended September 30, 2020.

The Company has a glossary of defined terms and related reconciliations of Non-GAAP financial measures on pages 26 through 32 of this release. Reconciliations and definitions of FFO and Normalized FFO are provided on pages 6, 28 and 29 of this release.

Same Store Results

The Company has provided a breakout of Residential and Non-Residential same store results on pages 10 and 11 of this release with definitions that can be found on page 30 of this release. Non-Residential operations account for approximately 2.4% of total revenues for the nine months ended September 30, 2020. The table below reflects same store Residential only results for the third quarter 2020 to third quarter 2019 comparison, which includes 75,596 apartment units, as well as for the nine months ended September 30, 2020 to nine months ended September 30, 2019 comparison, which includes 74,264 apartment units. The Company’s Physical Occupancy was 94.8% compared to 96.5% for the third quarter of 2020 and 2019, respectively, and 95.4% compared to 96.4% for the first nine months of 2020 and 2019, respectively.

		Third Quarter 2020 vs. Third Quarter 2019		September YTD 2020 vs. September YTD 2019
Revenues		(5.0%)		(1.0%)
Expenses		3.0%		1.7%
NOI		(8.4%)		(2.2%)

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. See pages 30 and 31 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.

		Third Quarter 2020 vs. Third Quarter 2019			September YTD 2020 vs. September YTD 2019
		% Change			% Change
Same Store Residential Revenues-
comparable period
Lease rates		(1.4	%)		1.0	%
Leasing Concessions (1)		(0.6	%)		(0.2	%)
Vacancy loss		(1.7	%)		(1.2	%)
Bad Debt, Net (2)		(2.0	%)		(1.0	%)
Other (3)		0.7	%		0.4	%
Same Store Residential Revenues-
current period		(5.0	%)		(1.0	%)

(1)	Reflects upfront discounts on both new move-in and renewal leases on a straight-line basis.
(2)	Reduction in rental income due to bad debt write-offs and reserves, net of amounts collected on previously written-off or reserved accounts.
(3)	Includes ancillary income, utility recoveries, miscellaneous income and other items.

Residential Same Store Operating Statistics

The following table includes select statistics for Residential Same Store Properties presented on a suburban and urban basis. Statistics for October 2020 are preliminary and Blended Rate is inclusive of Leasing Concessions.

		% of Same Store Residential Revenues		Physical Occupancy on:						Renewal %						Blended Rate						Change in Applications
		Sep YTD 2020		Jun 30, 2020		Sep 30, 2020		Oct 22, 2020		Oct 2019		Sep 2020		Oct 2020 (4)		Q3 2020		Sep 2020		Oct 2020 (4)		Q3 2020 vs. Q3 2019		Oct 2020 (4) vs. Oct 2019
Suburban (1)		44%		96.4%		95.9%		95.8%		59%		54%		57%		(4.8%)		(5.8%)		(6.0%)		10%		32%
Urban (1)(2)		33%		94.7%		94.4%		94.4%		50%		46%		50%		(6.5%)		(8.4%)		(10.7%)		21%		47%
Urban Core (1)(3)		23%		92.5%		89.2%		88.9%		58%		43%		46%		(14.7%)		(17.9%)		(21.4%)		48%		108%
Total		100%		95.1%		94.2%		94.1%		56%		50%		53%		(7.9%)		(9.5%)		(10.6%)		20%		46%

(1)	The Company defines Urban submarkets as those with 3,500 or more households per square mile with the remainder defined as Suburban.
(2)	Includes all other Urban properties excluding Urban Core.
(3)	Includes Urban properties in Manhattan/Brooklyn, Downtown Boston/Cambridge and Downtown San Francisco.
(4)	October 2020 results are preliminary.

Investment Activity

The Company acquired a 158-unit apartment property in suburban Seattle during the third quarter of 2020 for a purchase price of approximately $48.9 million at an Acquisition Capitalization Rate of 4.7%. The Company did not sell any assets during the third quarter of 2020. During the first nine months of 2020, the Company acquired the property described above and sold five properties, consisting of 1,552 apartment units, for an aggregate sales price of approximately $754.4 million at a weighted average Disposition Yield of 4.7%, generating an Unlevered IRR of 10.8%.

Fourth Quarter 2020 Earnings and Conference Call

Equity Residential expects to announce its fourth quarter and full year 2020 results on Tuesday, February 2, 2021 and host a conference call to discuss those results at 10:00 a.m. CT on Wednesday, February 3, 2021.

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 high quality long-term renters. Equity Residential owns or has investments in 305 properties consisting of 78,568 apartment units, located in Boston, New York, Washington, D.C., Seattle, San Francisco, Southern California and Denver. 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, competition and local government regulation. In addition, these forward-looking statements are subject to risks related to the COVID-19 pandemic, many of which are unknown, including the duration and severity of the pandemic, the extent of the adverse health impact on the general population and on our residents, customers and employees in particular, its impact on the employment rate and the economy and the corresponding impact on our residents’ and tenants’ ability to pay their rent on time or at all, the extent and impact of governmental responses and the impact of operational changes we have implemented and may implement in response to the pandemic. 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, October 28, 2020 at 10:00 a.m. CT. Please visit the Investor section of the Company’s web site at www.equityapartments.com for the link. A replay of the web cast will be available for two weeks at this site.

Equity Residential Consolidated Statements of Operations (Amounts in thousands except per share data) (Unaudited)
		Nine Months Ended September 30,								Quarter Ended September 30,
		2020				2019				2020				2019
REVENUES
Rental income		$	1,958,270			$	2,016,796			$	622,433			$	685,120
EXPENSES
Property and maintenance			333,333				338,497				113,065				114,966
Real estate taxes and insurance			288,043				270,434				95,273				87,546
Property management			71,513				72,705				20,196				21,940
General and administrative			37,212				41,127				10,859				11,417
Depreciation			619,003				616,201				200,605				211,478
Total expenses			1,349,104				1,338,964				439,998				447,347
Net gain (loss) on sales of real estate properties			352,218				269,400				(25	)			130,565
Operating income			961,384				947,232				182,410				368,338
Interest and other income			4,006				2,581				535				656
Other expenses			(8,324	)			(11,205	)			(4,097	)			(2,813	)
Interest:
Expense incurred, net			(248,349	)			(289,776	)			(80,874	)			(85,936	)
Amortization of deferred financing costs			(6,253	)			(8,664	)			(2,101	)			(2,881	)
Income before income and other taxes, income (loss) from
investments in unconsolidated entities and net gain (loss)
on sales of land parcels			702,464				640,168				95,873				277,364
Income and other tax (expense) benefit			(502	)			(749	)			(262	)			(265	)
Income (loss) from investments in unconsolidated entities			(2,445	)			66,906				(246	)			(1,152	)
Net gain (loss) on sales of land parcels			—				2,077				—				1,899
Net income			699,517				708,402				95,365				277,846
Net (income) loss attributable to Noncontrolling Interests:
Operating Partnership			(24,624	)			(25,339	)			(3,376	)			(9,910	)
Partially Owned Properties			(14,113	)			(2,450	)			(703	)			(830	)
Net income attributable to controlling interests			660,780				680,613				91,286				267,106
Preferred distributions			(2,318	)			(2,318	)			(773	)			(773	)
Net income available to Common Shares		$	658,462			$	678,295			$	90,513			$	266,333
Earnings per share – basic:
Net income available to Common Shares		$	1.77			$	1.83			$	0.24			$	0.72
Weighted average Common Shares outstanding			371,749				370,227				371,869				370,768
Earnings per share – diluted:
Net income available to Common Shares		$	1.77			$	1.82			$	0.24			$	0.71
Weighted average Common Shares outstanding			385,973				386,177				385,652				386,896
Distributions declared per Common Share outstanding		$	1.8075			$	1.7025			$	0.6025			$	0.5675

Equity Residential Consolidated Statements of Funds From Operations and Normalized Funds From Operations (Amounts in thousands except per share data) (Unaudited)
		Nine Months Ended September 30,								Quarter Ended September 30,
		2020				2019				2020				2019
Net income		$	699,517			$	708,402			$	95,365			$	277,846
Net (income) loss attributable to Noncontrolling Interests – Partially
Owned Properties			(14,113	)			(2,450	)			(703	)			(830	)
Preferred distributions			(2,318	)			(2,318	)			(773	)			(773	)
Net income available to Common Shares and Units			683,086				703,634				93,889				276,243
Adjustments:
Depreciation			619,003				616,201				200,605				211,478
Depreciation – Non-real estate additions			(3,433	)			(4,235	)			(1,126	)			(1,932	)
Depreciation – Partially Owned Properties			(2,514	)			(2,700	)			(828	)			(898	)
Depreciation – Unconsolidated Properties			1,838				2,385				614				613
Net (gain) loss on sales of unconsolidated entities - operating
assets			(1,000	)			(69,522	)			(1,000	)			—
Net (gain) loss on sales of real estate properties			(352,218	)			(269,400	)			25				(130,565	)
Noncontrolling Interests share of gain (loss) on sales
of real estate properties			11,655				—				—				—
FFO available to Common Shares and Units			956,417				976,363				292,179				354,939
Adjustments (see note for additional detail):
Impairment – non-operating assets			—				—				—				—
Write-off of pursuit costs			4,864				4,098				1,586				1,111
Debt extinguishment and preferred share redemption (gains)
losses			37				11,807				5				(4,840	)
Non-operating asset (gains) losses			1,022				(1,200	)			352				(1,452	)
Other miscellaneous items			(514	)			6,539				1,796				2,121
Normalized FFO available to Common Shares and Units		$	961,826			$	997,607			$	295,918			$	351,879
FFO		$	958,735			$	978,681			$	292,952			$	355,712
Preferred distributions			(2,318	)			(2,318	)			(773	)			(773	)
FFO available to Common Shares and Units		$	956,417			$	976,363			$	292,179			$	354,939
FFO per share and Unit – basic		$	2.49			$	2.55			$	0.76			$	0.93
FFO per share and Unit – diluted		$	2.48			$	2.53			$	0.76			$	0.92
Normalized FFO		$	964,144			$	999,925			$	296,691			$	352,652
Preferred distributions			(2,318	)			(2,318	)			(773	)			(773	)
Normalized FFO available to Common Shares and Units		$	961,826			$	997,607			$	295,918			$	351,879
Normalized FFO per share and Unit – basic		$	2.50			$	2.60			$	0.77			$	0.92
Normalized FFO per share and Unit – diluted		$	2.49			$	2.58			$	0.77			$	0.91
Weighted average Common Shares and Units outstanding – basic			384,759				383,142				384,871				383,709
Weighted average Common Shares and Units outstanding – diluted			385,973				386,177				385,652				386,896

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)
		September 30,				December 31,
		2020				2019
ASSETS
Land		$	5,794,771			$	5,936,188
Depreciable property			21,076,222				21,319,101
Projects under development			337,696				181,630
Land held for development			103,900				96,688
Investment in real estate			27,312,589				27,533,607
Accumulated depreciation			(7,738,318	)			(7,276,786	)
Investment in real estate, net			19,574,271				20,256,821
Investments in unconsolidated entities			54,828				52,238
Cash and cash equivalents			178,333				45,753
Restricted deposits			56,881				71,246
Right-of-use assets			502,184				512,774
Other assets			257,481				233,937
Total assets		$	20,623,978			$	21,172,769
LIABILITIES AND EQUITY
Liabilities:
Mortgage notes payable, net		$	2,313,833			$	1,941,610
Notes, net			6,082,897				6,077,513
Line of credit and commercial paper			—				1,017,833
Accounts payable and accrued expenses			158,611				94,350
Accrued interest payable			65,669				66,852
Lease liabilities			329,684				331,334
Other liabilities			331,522				346,963
Security deposits			61,453				70,062
Distributions payable			232,237				218,326
Total liabilities			9,575,906				10,164,843
Commitments and contingencies
Redeemable Noncontrolling Interests – Operating Partnership			293,706				463,400
Equity:
Shareholders’ equity:
Preferred Shares of beneficial interest, $0.01 par value;
100,000,000 shares authorized; 745,600 shares issued and
outstanding as of September 30, 2020 and December 31, 2019			37,280				37,280
Common Shares of beneficial interest, $0.01 par value;
1,000,000,000 shares authorized; 372,239,249 shares issued
and outstanding as of September 30, 2020 and 371,670,884
shares issued and outstanding as of December 31, 2019			3,722				3,717
Paid in capital			9,166,018				8,965,577
Retained earnings			1,371,938				1,386,495
Accumulated other comprehensive income (loss)			(61,478	)			(77,563	)
Total shareholders’ equity			10,517,480				10,315,506
Noncontrolling Interests:
Operating Partnership			232,516				227,837
Partially Owned Properties			4,370				1,183
Total Noncontrolling Interests			236,886				229,020
Total equity			10,754,366				10,544,526
Total liabilities and equity		$	20,623,978			$	21,172,769

Equity Residential Portfolio Summary As of September 30, 2020
										% of Stabilized				Average
						Apartment				Budgeted				Rental
Markets/Metro Areas		Properties				Units				NOI				Rate
Los Angeles			72				16,603				19.0	%		$	2,488
Orange County			13				4,028				4.4	%			2,243
San Diego			12				3,385				3.8	%			2,405
Subtotal – Southern California			97				24,016				27.2	%			2,435
San Francisco			48				12,707				19.8	%			3,202
Washington DC			47				14,731				15.8	%			2,449
New York			37				9,606				14.6	%			3,805
Seattle			46				9,454				11.0	%			2,422
Boston			25				6,430				10.1	%			3,079
Denver			5				1,624				1.5	%			2,041
Total			305				78,568				100.0	%		$	2,765

		Properties				Apartment Units
Wholly Owned Properties			288				75,007
Master-Leased Properties – Consolidated			1				162
Partially Owned Properties – Consolidated			16				3,399
			305				78,568

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

Equity Residential
Portfolio Rollforward Q3 2020 ($ in thousands)
				Properties				Apartment Units				Purchase Price				Acquisition Cap Rate
		6/30/2020			304				78,410
Acquisitions:
Consolidated Rental Properties – Not Stabilized (A)					1				158			$	48,860				4.7	%
		9/30/2020			305				78,568

Portfolio Rollforward 2020 ($ in thousands)
				Properties				Apartment Units				Purchase Price				Acquisition Cap Rate
		12/31/2019			309				79,962
Acquisitions:
Consolidated Rental Properties – Not Stabilized (A)					1				158			$	48,860				4.7	%
												Sales Price				Disposition Yield
Dispositions:
Consolidated Rental Properties					(5	)			(1,552	)		$	(754,361	)			(4.7	%)
		9/30/2020			305				78,568

(A)	The Company acquired one property in the Seattle market in the third quarter of 2020 that is in lease-up and is expected to stabilize in its second year of ownership at an Acquisition Cap Rate of 4.7%.

Equity Residential
Third Quarter 2020 vs. Third Quarter 2019 Same Store Results/Statistics Including 75,596 Same Store Apartment Units $ in thousands (except for Average Rental Rate)
Third Quarter 2020																										Third Quarter 2019
		Residential				% Change				Non- Residential				% Change				Total				% Change						Residential				Non- Residential				Total
Revenues		$	597,210		(1)	(5.0%)				$	5,887		(2)	(75.5%)				$	603,097			(7.5%)				Revenues		$	628,345			$	23,985			$	652,330
Expenses		$	197,440			3.0%				$	5,718			10.3%				$	203,158			3.2%				Expenses		$	191,677			$	5,186			$	196,863
NOI		$	399,770			(8.4%)				$	169			(99.1%)				$	399,939			(12.2%)				NOI		$	436,668			$	18,799			$	455,467
Average Rental Rate		$	2,781			(3.2%)																				Average Rental Rate		$	2,874
Physical Occupancy			94.8	%		(1.7%)																				Physical Occupancy			96.5	%
Turnover			17.7	%		1.6%																				Turnover			16.1	%

Third Quarter 2020 vs. Second Quarter 2020 Same Store Results/Statistics Including 78,030 Same Store Apartment Units $ in thousands (except for Average Rental Rate)
Third Quarter 2020																										Second Quarter 2020
		Residential				% Change				Non- Residential				% Change				Total				% Change						Residential				Non- Residential				Total
Revenues		$	613,726		(1)	(2.7%)				$	6,126		(2)	(58.5%)				$	619,852			(4.0%)				Revenues		$	630,951			$	14,766			$	645,717
Expenses		$	202,964			5.9%				$	5,787			9.7%				$	208,751			6.0%				Expenses		$	191,728			$	5,273			$	197,001
NOI		$	410,762			(6.5%)				$	339			(96.4%)				$	411,101			(8.4%)				NOI		$	439,223			$	9,493			$	448,716
Average Rental Rate		$	2,769			(2.6%)																				Average Rental Rate		$	2,844
Physical Occupancy			94.8	%		0.0%																				Physical Occupancy			94.8	%
Turnover			17.9	%		6.1%																				Turnover			11.8	%

(1)	With Leasing Concessions reflected on a cash basis, Same Store Residential Revenues decreased 6.2% in the third quarter of 2020 compared to the third quarter of 2019 and 3.8% in the third quarter of 2020 compared to the second quarter of 2020. See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for additional detail and reconciliations.
(2)	Non-Residential operations for the third quarter of 2020 include a $10.6 million non-cash write-off of Non-Residential straight-line lease receivables. The decline in Non-Residential revenues is primarily driven by the deferral/abatement of rent, higher bad debt (inclusive of the Non-Residential straight-line write-off), and to a lesser extent, lower public parking income.

Equity Residential
September YTD 2020 vs. September YTD 2019 Same Store Results/Statistics Including 74,264 Same Store Apartment Units $ in thousands (except for Average Rental Rate)
September YTD 2020																										September YTD 2019
		Residential				% Change				Non- Residential				% Change				Total				% Change						Residential				Non- Residential				Total
Revenues		$	1,811,101		(1)	(1.0%)				$	43,282		(2)	(39.0%)				$	1,854,383			(2.4%)				Revenues		$	1,829,896			$	70,924			$	1,900,820
Expenses		$	569,970			1.7%				$	16,737			5.6%				$	586,707			1.8%				Expenses		$	560,225			$	15,845			$	576,070
NOI		$	1,241,131			(2.2%)				$	26,545			(51.8%)				$	1,267,676			(4.3%)				NOI		$	1,269,671			$	55,079			$	1,324,750
Average Rental Rate		$	2,843			0.1%																				Average Rental Rate		$	2,841
Physical Occupancy			95.4	%		(1.0%)																				Physical Occupancy			96.4	%
Turnover			39.1	%		(0.3%)																				Turnover			39.4	%

(1)	With Leasing Concessions reflected on a cash basis, Same Store Residential Revenues decreased 1.6% in the nine months ended September 30, 2020 compared to the nine months ended September 30, 2019. See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for additional detail and reconciliations.
(2)	Non-Residential operations for the nine months ended September 30, 2020 include a $12.9 million non-cash write-off of Non-Residential straight-line lease receivables. The decline in Non-Residential revenues is primarily driven by the deferral/abatement of rent, higher bad debt (inclusive of the Non-Residential straight-line write-off), and to a lesser extent, lower public parking income.

Same Store Resident/Tenant Accounts Receivable Balances Including 74,264 Same Store Apartment Units $ in thousands
		Residential								Non-Residential
Balance Sheet (Other assets):		September 30, 2020				June 30, 2020				September 30, 2020				June 30, 2020
Resident/tenant accounts receivable balances		$	23,797			$	18,175			$	7,635			$	4,815
Allowance for doubtful accounts			(15,201	)			(6,518	)			(6,444	)			(2,416	)
Net receivable balances		$	8,596		(1)	$	11,657			$	1,191			$	2,399
Straight-line receivable balances		$	10,536			$	2,990			$	13,727			$	24,161

(1)	The Company held Residential security deposits approximating 27.5% of the net receivable balance at September 30, 2020.

Same Store Residential Bad Debt Including 74,264 Same Store Apartment Units $ in thousands
						September				September
Income Statement (Rental income):		Q3 2020				YTD 2020				YTD 2019
Bad Debt, Net		$	15,064			$	27,301			$	8,261
% of Same Store Residential Revenues			2.6	%			1.5	%			0.5	%

Equity Residential Third Quarter 2020 vs. Third Quarter 2019 Same Store Residential Results/Statistics by Market
																						Increase (Decrease) from Prior Year's Quarter
Markets/Metro Areas		Apartment Units				Q3 2020 % of Actual NOI				Q3 2020 Average Rental Rate				Q3 2020 Weighted Average Physical Occupancy %				Q3 2020 Turnover				Revenues				Expenses				NOI				Average Rental Rate				Physical Occupancy				Turnover
Los Angeles			15,968				19.5	%		$	2,497				96.0	%			15.0	%			(5.6	%)			1.5	%			(8.6	%)			(5.0	%)			(0.6	%)			(1.7	%)
Orange County			4,028				4.9	%			2,243				96.8	%			15.9	%			(1.5	%)			2.9	%			(2.8	%)			(1.7	%)			0.2	%			(1.4	%)
San Diego			3,385				4.4	%			2,405				96.8	%			17.4	%			(1.4	%)			(1.9	%)			(1.2	%)			(1.5	%)			0.2	%			(1.1	%)
Subtotal – Southern California			23,381				28.8	%			2,440				96.2	%			15.5	%			(4.4	%)			1.2	%			(6.6	%)			(4.0	%)			(0.4	%)			(1.6	%)
San Francisco			12,570				20.7	%			3,193				94.4	%			18.5	%			(5.8	%)			3.0	%			(8.7	%)			(4.4	%)			(1.5	%)			2.4	%
Washington DC			14,077				16.7	%			2,445				95.6	%			17.5	%			(1.2	%)			2.7	%			(3.0	%)			(0.2	%)			(1.0	%)			0.9	%
New York			9,606				13.0	%			3,805				91.3	%			20.3	%			(9.2	%)			2.6	%			(17.9	%)			(3.7	%)			(5.6	%)			7.0	%
Seattle			8,616				10.3	%			2,431				94.7	%			17.2	%			(2.6	%)			9.1	%			(7.1	%)			(0.7	%)			(1.8	%)			2.1	%
Boston			6,346				9.4	%			3,079				93.6	%			20.6	%			(5.8	%)			3.2	%			(9.4	%)			(3.0	%)			(2.8	%)			4.2	%
Denver			1,000				1.1	%			2,146				94.5	%			24.4	%			(3.8	%)			9.8	%			(9.0	%)			(2.7	%)			(1.2	%)			3.4	%
Total			75,596				100.0	%		$	2,781				94.8	%			17.7	%			(5.0	%)	(1)		3.0	%			(8.4	%)			(3.2	%)			(1.7	%)			1.6	%

(1)

With Leasing Concessions reflected on a cash basis, Same Store Residential Revenues decreased 6.2% in the third quarter of 2020 compared to the third quarter of 2019. See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for additional detail and reconciliations.

Note: The above table reflects Residential same store results only, which account for approximately 97.6% of total revenues.

Equity Residential Third Quarter 2020 vs. Second Quarter 2020 Same Store Residential Results/Statistics by Market
																						Increase (Decrease) from Prior Quarter
Markets/Metro Areas		Apartment Units				Q3 2020 % of Actual NOI				Q3 2020 Average Rental Rate				Q3 2020 Weighted Average Physical Occupancy %				Q3 2020 Turnover				Revenues				Expenses				NOI				Average Rental Rate				Physical Occupancy				Turnover
Los Angeles			16,603				19.6	%		$	2,488				95.9	%			15.4	%			(2.5	%)			5.3	%			(5.9	%)			(3.9	%)			1.3	%			3.3	%
Orange County			4,028				4.8	%			2,243				96.8	%			15.9	%			(0.3	%)			9.8	%			(3.3	%)			(0.9	%)			0.5	%			6.1	%
San Diego			3,385				4.2	%			2,405				96.8	%			17.4	%			(0.1	%)			4.2	%			(1.6	%)			(0.9	%)			0.8	%			5.6	%
Subtotal – Southern California			24,016				28.6	%			2,435				96.2	%			15.8	%			(1.9	%)			5.7	%			(4.8	%)			(3.0	%)			1.1	%			4.2	%
San Francisco			12,707				20.4	%			3,202				94.4	%			18.6	%			(4.0	%)			4.2	%			(6.8	%)			(3.6	%)			(0.4	%)			6.9	%
Washington DC			14,569				16.8	%			2,449				95.6	%			17.6	%			(0.1	%)			10.2	%			(4.4	%)			(0.4	%)			0.2	%			6.3	%
New York			9,606				12.7	%			3,805				91.3	%			20.3	%			(5.6	%)			3.5	%			(12.8	%)			(2.7	%)			(2.8	%)			8.8	%
Seattle			9,078				10.6	%			2,438				94.6	%			17.5	%			(2.3	%)			4.3	%			(5.0	%)			(1.5	%)			(0.8	%)			5.9	%
Boston			6,430				9.3	%			3,079				93.5	%			20.7	%			(3.0	%)			9.3	%			(7.6	%)			(3.0	%)			0.0	%			7.1	%
Denver			1,624				1.6	%			2,041				95.1	%			22.7	%			0.8	%			10.1	%			(2.9	%)			(0.3	%)			1.0	%			5.6	%
Total			78,030				100.0	%		$	2,769				94.8	%			17.9	%			(2.7	%)	(1)		5.9	%			(6.5	%)			(2.6	%)			0.0	%			6.1	%

(1)

With Leasing Concessions reflected on a cash basis, Same Store Residential Revenues decreased 3.8% in the third quarter of 2020 compared to the second quarter of 2020. See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for additional detail and reconciliations.

Note: The above table reflects Residential same store results only, which account for approximately 97.6% of total revenues.

Equity Residential September YTD 2020 vs. September YTD 2019 Same Store Residential Results/Statistics by Market
																						Increase (Decrease) from Prior Year
Markets/Metro Areas		Apartment Units				Sept. YTD 20 % of Actual NOI				Sept. YTD 20 Average Rental Rate				Sept. YTD 20 Weighted Average Physical Occupancy %				Sept. YTD 20 Turnover				Revenues				Expenses				NOI				Average Rental Rate				Physical Occupancy				Turnover
Los Angeles			15,968				19.8	%		$	2,575				95.5	%			38.2	%			(1.8	%)			0.3	%			(2.8	%)			(1.0	%)			(0.8	%)			(4.3	%)
Orange County			4,028				4.9	%			2,262				96.6	%			34.7	%			1.0	%			1.1	%			0.9	%			0.7	%			0.2	%			(6.7	%)
San Diego			3,385				4.2	%			2,425				96.5	%			41.2	%			0.8	%			0.7	%			0.9	%			0.8	%			0.0	%			(3.6	%)
Subtotal – Southern California			23,381				28.9	%			2,499				95.9	%			38.0	%			(1.0	%)			0.5	%			(1.6	%)			(0.5	%)			(0.5	%)			(4.6	%)
San Francisco			12,183				20.6	%			3,292				95.4	%			39.7	%			(1.3	%)			2.8	%			(2.6	%)			(0.3	%)			(0.9	%)			0.7	%
Washington DC			13,711				16.2	%			2,461				95.8	%			37.4	%			0.4	%			0.9	%			0.2	%			1.4	%			(0.8	%)			0.1	%
New York			9,475				13.6	%			3,891				94.0	%			39.1	%			(3.3	%)			2.5	%			(7.7	%)			(0.5	%)			(2.8	%)			7.6	%
Seattle			8,442				10.2	%			2,456				95.8	%			40.0	%			1.6	%			4.7	%			0.3	%			2.3	%			(0.7	%)			(3.2	%)
Boston			6,346				9.7	%			3,145				94.3	%			43.3	%			(1.3	%)			(0.2	%)			(1.7	%)			0.7	%			(1.9	%)			5.3	%
Denver			726				0.8	%			2,123				94.5	%			54.5	%			(1.8	%)			3.7	%			(3.7	%)			(0.1	%)			(1.8	%)			3.3	%
Total			74,264				100.0	%		$	2,843				95.4	%			39.1	%			(1.0	%)	(1)		1.7	%			(2.2	%)			0.1	%			(1.0	%)			(0.3	%)

(1)

With Leasing Concessions reflected on a cash basis, Same Store Residential Revenues decreased 1.6% in the nine months ended September 30, 2020 compared to the nine months ended September 30, 2019. See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for additional detail and reconciliations.

Note: The above table reflects Residential same store results only, which account for approximately 97.6% of total revenues.

Equity Residential Same Store Residential Net Effective Lease Pricing Statistics For 74,264 Same Store Apartment Units
		New Lease Change (1)								Renewal Rate Achieved (2)								Blended Rate (3)
Markets/Metro Areas		Q3 2020				Q3 2019				Q3 2020				Q3 2019				Q3 2020				Q3 2019
Los Angeles			(8.3	%)			(0.1	%)			(0.1	%)			5.3	%			(4.7	%)			2.4	%
Orange County			(4.6	%)			(0.2	%)			1.2	%			5.6	%			(1.5	%)			2.6	%
San Diego			(3.9	%)			(0.8	%)			1.6	%			5.8	%			(1.3	%)			2.0	%
Subtotal – Southern California			(7.1	%)			(0.2	%)			0.4	%			5.4	%			(3.6	%)			2.4	%
San Francisco			(19.0	%)			0.0	%			(5.3	%)			5.4	%			(12.7	%)			2.7	%
Washington DC			(8.3	%)			2.6	%			0.0	%			4.7	%			(4.3	%)			3.7	%
New York			(20.1	%)			2.0	%			(1.9	%)			3.9	%			(11.5	%)			3.1	%
Seattle			(13.6	%)			3.6	%			(1.7	%)			7.3	%			(7.8	%)			5.5	%
Boston			(15.2	%)			3.8	%			(1.9	%)			5.7	%			(9.1	%)			4.8	%
Denver			(10.2	%)			(2.1	%)			1.0	%			5.6	%			(6.2	%)			0.6	%
Total			(13.5	%)			1.3	%			(1.6	%)			5.2	%			(7.9	%)			3.3	%

(1)	New Lease Change – The net effective change in rent (inclusive of Leasing Concessions) for a lease with a new or transferring resident compared to the rent for the prior lease of the identical apartment unit, regardless of lease term.
(2)	Renewal Rate Achieved – The net effective change in rent (inclusive of Leasing Concessions) for a new lease on an apartment unit where the lease has been renewed as compared to the rent for the prior lease of the identical apartment unit, regardless of lease term.
(3)	Blended Rate – The weighted average of New Lease Change and Renewal Rate Achieved.

Equity Residential
Third Quarter 2020 vs. Third Quarter 2019 Total Same Store Operating Expenses Including 75,596 Same Store Apartment Units $ in thousands
		Q3 2020				Q3 2019				$ Change (1)				% Change				% of Q3 2020 Operating Expenses
Real estate taxes		$	87,334			$	83,337			$	3,997				4.8	%			43.0	%
On-site payroll			42,503				42,565				(62	)			(0.1	%)			20.9	%
Utilities			27,282				26,789				493				1.8	%			13.4	%
Repairs and maintenance			26,602				25,457				1,145				4.5	%			13.1	%
Insurance			6,246				5,268				978				18.6	%			3.1	%
Leasing and advertising			3,024				2,792				232				8.3	%			1.5	%
Other on-site operating expenses			10,167				10,655				(488	)			(4.6	%)			5.0	%
Total Same Store Operating Expenses (2) (includes Residential and Non-Residential)		$	203,158			$	196,863			$	6,295				3.2	%			100.0	%

September YTD 2020 vs. September YTD 2019 Total Same Store Operating Expenses Including 74,264 Same Store Apartment Units $ in thousands
		September YTD 2020				September YTD 2019				$ Change (1)				% Change				% of September YTD 2020 Operating Expenses
Real estate taxes		$	256,320			$	246,112			$	10,208				4.1	%			43.7	%
On-site payroll			123,061				123,653				(592	)			(0.5	%)			21.0	%
Utilities			77,545				76,183				1,362				1.8	%			13.2	%
Repairs and maintenance			70,635				73,079				(2,444	)			(3.3	%)			12.0	%
Insurance			18,345				15,547				2,798				18.0	%			3.1	%
Leasing and advertising			7,366				7,649				(283	)			(3.7	%)			1.3	%
Other on-site operating expenses			33,435				33,847				(412	)			(1.2	%)			5.7	%
Total Same Store Operating Expenses (2) (includes Residential and Non-Residential)		$	586,707			$	576,070			$	10,637				1.8	%			100.0	%

(1)	The quarter over quarter and YTD over YTD changes are due primarily to:
	Real estate taxes – Higher rates and assessed values continue to drive real estate tax growth across most markets. Lower than anticipated appeals activity also impacted growth, particularly during the third quarter of 2020.
	On-site payroll – Year over year decrease driven by the transition to an enhanced operating platform, lower employee benefit-related costs and less overtime, partially offset by one-time frontline worker bonuses.
	Repairs and maintenance – Quarter over quarter increase primarily driven by COVID-19-related cleaning expenses and higher turnover expenses. Year over year decrease primarily driven by deferral and cancellation of some projects as a result of COVID-19-related delays.
	Insurance – Increase due to higher premiums on property insurance renewal due to challenging conditions in the insurance market.
	Leasing and advertising – Quarter over quarter increase primarily driven by the write-off of a Non-Residential deferred leasing cost. Year over year decrease primarily due to suspension of in-person resident social activities sponsored by the Company.
(2)	See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for additional details.

Equity Residential
Debt Summary as of September 30, 2020 ($ in thousands)
		Debt Balances (1)				% of Total				Weighted Average Rates (1)				Weighted Average Maturities (years)
Secured		$	2,313,833				27.6	%			3.39	%			6.9
Unsecured			6,082,897				72.4	%			3.91	%			10.1
Total		$	8,396,730				100.0	%			3.78	%			9.2
Fixed Rate Debt:
Secured – Conventional		$	1,935,286				23.1	%			3.84	%			5.3
Unsecured – Public			6,082,897				72.4	%			4.04	%			10.1
Fixed Rate Debt			8,018,183				95.5	%			4.00	%			8.9
Floating Rate Debt:
Secured – Conventional			17,605				0.2	%			3.02	%			1.7
Secured – Tax Exempt			360,942				4.3	%			1.17	%			15.2
Unsecured – Revolving Credit Facility			—				—				1.47	%			4.1
Unsecured – Commercial Paper Program (2)			—				—				1.81	%			—
Floating Rate Debt			378,547				4.5	%			1.50	%			14.6
Total		$	8,396,730				100.0	%			3.78	%			9.2

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

(2) The weighted average amount outstanding for the nine months ended September 30, 2020 was approximately $347.2 million.

Note: The Company capitalized interest of approximately $6.9 million and $4.8 million during the nine months ended September 30, 2020 and 2019, respectively. The Company capitalized interest of approximately $2.8 million and $2.1 million during the quarters ended September 30, 2020 and 2019, respectively.

Equity Residential
Debt Maturity Schedule as of September 30, 2020 ($ 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)
2020		$	1,991			$	—			$	1,991				0.0	%			3.40	%			3.40	%
2021			818,366				—				818,366				9.7	%			4.62	%			4.62	%
2022			264,185				18,026				282,211				3.3	%			3.25	%			3.19	%
2023			1,325,588				3,500				1,329,088				15.7	%			3.74	%			3.73	%
2024			—				6,100				6,100				0.1	%		N/A					0.13	%
2025			450,000				8,200				458,200				5.4	%			3.38	%			3.32	%
2026			592,025				9,000				601,025				7.1	%			3.58	%			3.53	%
2027			400,000				9,800				409,800				4.8	%			3.25	%			3.18	%
2028			900,000				42,380				942,380				11.1	%			3.79	%			3.62	%
2029			888,120				11,500				899,620				10.6	%			3.30	%			3.26	%
2030+			2,445,850				288,135				2,733,985				32.2	%			3.56	%			3.21	%
Subtotal			8,086,125				396,641				8,482,766				100.0	%			3.66	%			3.50	%
Deferred Financing Costs and Unamortized (Discount)			(67,942	)			(18,094	)			(86,036	)		N/A				N/A				N/A
Total		$	8,018,183			$	378,547			$	8,396,730				100.0	%			3.66	%			3.50	%

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

Equity Residential
Selected Unsecured Public Debt Covenants
		September 30,			June 30,
		2020			2020
Debt to Adjusted Total Assets (not to exceed 60%)		31.6%			31.8%
Secured Debt to Adjusted Total Assets (not to exceed 40%)		9.6%			9.7%
Consolidated Income Available for Debt Service to
Maximum Annual Service Charges
(must be at least 1.5 to 1)		4.99			4.94
Total Unencumbered Assets to Unsecured Debt
(must be at least 125%)		437.4%			439.5%

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
		September 30,				June 30,
		2020				2020
Total debt to Normalized EBITDAre		5.00x				4.82x
Net debt to Normalized EBITDAre		4.89x				4.71x
Unencumbered NOI as a % of total NOI		86.1%				85.8%

Note: See Normalized EBITDAre Reconciliations for detail.

Equity Residential
Capital Structure as of September 30, 2020 (Amounts in thousands except for share/unit and per share amounts)
Secured Debt										$	2,313,833				27.6	%
Unsecured Debt											6,082,897				72.4	%
Total Debt											8,396,730				100.0	%			29.7	%
Common Shares (includes Restricted Shares)			372,239,249				96.4	%
Units (includes OP Units and Restricted Units)			13,879,400				3.6	%
Total Shares and Units			386,118,649				100.0	%
Common Share Price at September 30, 2020		$	51.33
											19,819,470				99.8	%
Perpetual Preferred Equity (see below)											37,280				0.2	%
Total Equity											19,856,750				100.0	%			70.3	%
Total Market Capitalization										$	28,253,480								100.0	%

Perpetual Preferred Equity as of September 30, 2020 (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		12/10/26			745,600			$	37,280			$	4.145			$	3,091

Equity Residential Common Share and Unit Weighted Average Amounts Outstanding
		Sept. YTD 2020				Sept. YTD 2019				Q3 2020				Q3 2019
Weighted Average Amounts Outstanding for Net Income Purposes:
Common Shares - basic			371,749,243				370,226,966				371,869,274				370,767,761
Shares issuable from assumed conversion/vesting of:
- OP Units			13,009,281				12,915,512				13,001,245				12,941,406
- long-term compensation shares/units			1,214,047				3,034,089				781,405				3,186,671
Total Common Shares and Units - diluted			385,972,571				386,176,567				385,651,924				386,895,838
Weighted Average Amounts Outstanding for FFO and Normalized FFO Purposes:
Common Shares - basic			371,749,243				370,226,966				371,869,274				370,767,761
OP Units - basic			13,009,281				12,915,512				13,001,245				12,941,406
Total Common Shares and OP Units - basic			384,758,524				383,142,478				384,870,519				383,709,167
Shares issuable from assumed conversion/vesting of:
- long-term compensation shares/units			1,214,047				3,034,089				781,405				3,186,671
Total Common Shares and Units - diluted			385,972,571				386,176,567				385,651,924				386,895,838
Period Ending Amounts Outstanding:
Common Shares (includes Restricted Shares)			372,239,249				371,327,332
Units (includes OP Units and Restricted Units)			13,879,400				13,749,690
Total Shares and Units			386,118,649				385,077,022

Equity Residential Development and Lease-Up Projects as of September 30, 2020 (Amounts in thousands except for project and apartment unit amounts)
				No. of				Total Budgeted				Total Book				Total Book Value Not												Estimated/Actual
Projects		Location		Apartment Units				Capital Cost				Value to Date				Placed in Service				Total Debt				Percentage Completed				Initial Occupancy				Completion Date		Stabilization Date		Percentage Leased				Percentage Occupied
Projects Under Development - Wholly Owned:
Alcott Apartments (fka West End Tower)		Boston, MA			470			$	409,749			$	225,141			$	225,141			$	—			56%				Q2 2021				Q3 2021		Q1 2023			—				—
The Edge (fka 4885 Edgemoor Lane) (A)		Bethesda, MD			154				75,271				38,450				38,450				—			50%				Q3 2021				Q3 2021		Q3 2022			—				—
Projects Under Development - Wholly Owned					624				485,020				263,591				263,591				—
Projects Under Development - Partially Owned:
Aero Apartments (B)		Alameda, CA			200				117,794				74,105				74,105				17,605			59%				Q1 2021				Q2 2021		Q2 2022			—				—
Projects Under Development - Partially Owned					200				117,794				74,105				74,105				17,605
Total Projects Under Development					824			$	602,814			$	337,696			$	337,696			$	17,605
Land Held for Development				N/A				N/A				$	103,900			$	103,900			$	—
NOI CONTRIBUTION FROM DEVELOPMENT PROJECTS																								Total Budgeted Capital Cost				Q3 2020 NOI
Projects Under Development																								$	602,814			$	—

(A)	The Edge – The land under this project is subject to a long-term ground lease. This project is adjacent to an existing apartment property owned by the Company.
(B)	Aero Apartments – This development project is owned 90% by the Company and 10% by a third party partner in a joint venture consolidated by the Company. Construction is being partially funded with a construction loan that is non-recourse to the Company. The joint venture partner has funded $4.7 million for its allocated share of the project equity and serves as the developer of the project.

Equity Residential Capital Expenditures to Real Estate For the Nine Months Ended September 30, 2020 (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				74,264				4,304				78,568
Building Improvements			$	47,977			$	1,977			$	49,954			$	646
Renovation Expenditures (1)				17,682				6				17,688				238
Replacements				24,148				333				24,481				325
Capital Expenditures to Real Estate (2)			$	89,807			$	2,316			$	92,123			$	1,209

(1)	Renovation Expenditures on 782 same store apartment units for the nine months ended September 30, 2020 approximated $22,612 per apartment unit renovated.
(2)	See Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms for additional details.

Equity Residential Normalized EBITDAre Reconciliations (Amounts in thousands)
		Trailing Twelve Months								2020												2019
		September 30, 2020				June 30, 2020				Q3				Q2				Q1				Q4				Q3
Net income		$	1,000,823			$	1,183,304			$	95,365			$	271,481			$	332,671			$	301,306			$	277,846
Interest expense incurred, net			348,649				353,711				80,874				81,885				85,590				100,300				85,936
Amortization of deferred financing costs			9,259				10,039				2,101				2,111				2,041				3,006				2,881
Amortization of above/below market lease intangibles			4,391				4,391				1,098				1,098				1,097				1,098				1,098
Depreciation			833,885				844,758				200,605				205,976				212,422				214,882				211,478
Income and other tax expense (benefit)			(2,528	)			(2,525	)			262				187				53				(3,030	)			265
EBITDA			2,194,479				2,393,678				380,305				562,738				633,874				617,562				579,504
Net (gain) loss on sales of real estate properties			(530,455	)			(661,045	)			25				(144,266	)			(207,977	)			(178,237	)			(130,565	)
Net (gain) loss on sales of unconsolidated entities - operating assets			(1,000	)			—				(1,000	)			—				—				—				—
EBITDAre			1,663,024				1,732,633				379,330				418,472				425,897				439,325				448,939
Write-off of pursuit costs (other expenses)			6,295				5,820				1,586				1,651				1,627				1,431				1,111
(Income) loss from investments in unconsolidated entities - operations			4,406				4,312				1,246				1,042				1,157				961				1,152
Net (gain) loss on sales of land parcels			33				(1,866	)			—				—				—				33				(1,899	)
Insurance/litigation settlement or reserve income (interest and other income)			(2,353	)			(2,350	)			(3	)			(767	)			(1,582	)			(1	)			—
Insurance/litigation/environmental settlement or reserve expense (other expenses)			3,936				3,454				500				(1,956	)			163				5,229				18
Advocacy contributions (other expenses)			4,146				2,423				1,728				1,852				501				65				5
Data analytics project (other expenses)			—				1,416				—				—				—				—				1,416
Other			(1,108	)			3				(429	)			(521	)			—				(158	)			682
Normalized EBITDAre		$	1,678,379			$	1,745,845			$	383,958			$	419,773			$	427,763			$	446,885			$	451,424
Balance Sheet Items:		September 30, 2020				June 30, 2020
Total debt		$	8,396,730			$	8,421,859
Cash and cash equivalents			(178,333	)			(187,416	)
Mortgage principal reserves/sinking funds			(13,013	)			(11,895	)
Net debt		$	8,205,384			$	8,222,548

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)
		Nine Months Ended September 30,												Quarter Ended September 30,
		2020				2019				Variance				2020				2019				Variance
Impairment – non-operating assets		$	—			$	—			$	—			$	—			$	—			$	—
Write-off of pursuit costs (other expenses)			4,864				4,098				766				1,586				1,111				475
Prepayment premiums/penalties (interest expense)			—				3,381				(3,381	)			—				3,381				(3,381	)
Write-off of unamortized deferred financing costs (interest expense)			37				2,273				(2,236	)			5				767				(762	)
Write-off of unamortized (premiums)/discounts/OCI (interest expense)			—				6,153				(6,153	)			—				(8,988	)			8,988
Debt extinguishment and preferred share redemption (gains) losses			37				11,807				(11,770	)			5				(4,840	)			4,845
Net (gain) loss on sales of land parcels			—				(2,077	)			2,077				—				(1,899	)			1,899
(Income) loss from investments in unconsolidated entities ─ non-operating assets			1,022				877				145				352				447				(95	)
Non-operating asset (gains) losses			1,022				(1,200	)			2,222				352				(1,452	)			1,804
Insurance/litigation settlement or reserve income (interest and other income)			(2,352	)			(383	)			(1,969	)			(3	)			—				(3	)
Insurance/litigation/environmental settlement or reserve expense (other expenses)			(1,293	)			1,969				(3,262	)			500				18				482
Advocacy contributions (other expenses)			4,081				205				3,876				1,728				5				1,723
Data analytics project (other expenses)			—				4,199				(4,199	)			—				1,416				(1,416	)
Other			(950	)			549				(1,499	)			(429	)			682				(1,111	)
Other miscellaneous items			(514	)			6,539				(7,053	)			1,796				2,121				(325	)
Adjustments from FFO to Normalized FFO		$	5,409			$	21,244			$	(15,835	)		$	3,739			$	(3,060	)		$	6,799

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 Additional Reconciliations and Definitions of Non-GAAP Financial Measures and Other Terms (Amounts in thousands except per share and per apartment unit data) (All per share data is diluted)

This Earnings Release and Supplemental Financial Information includes certain non-GAAP financial measures and other terms that management believes are helpful in understanding our business. The definitions and calculations of these non-GAAP financial measures and other terms may differ from the definitions and methodologies used by other real estate investment trusts (“REIT”) and, accordingly, may not be comparable. These non-GAAP financial measures should not be considered as an alternative to net earnings or any other measurement of performance computed in accordance with accounting principles generally accepted in the United States (“GAAP”) or as an alternative to cash flows from specific operating, investing or financing activities. Furthermore, these non-GAAP financial measures are not intended to be a measure of cash flow or liquidity.

Acquisition Capitalization Rate or Cap Rate – NOI that the Company anticipates receiving in the next 12 months (or the year two or three stabilized NOI for properties that are in lease-up at acquisition) less an estimate of property management costs/management fees allocated to the project (generally ranging from 2.0% to 4.0% of revenues depending on the size and income streams of the asset) and less an estimate for in-the-unit replacement capital expenditures (generally ranging from $100-$450 per apartment unit depending on the age and condition of the asset) divided by the gross purchase price of the asset. The weighted average Acquisition Cap Rate for acquired properties is weighted based on the projected NOI streams and the relative purchase price for each respective property.

Average Rental Rate – Total Residential rental revenues reflected on a straight-line basis in accordance with GAAP divided by the weighted average occupied apartment units for the reporting period presented.

Bad Debt, Net – Reduction in rental income due to bad debt write-offs and reserves, net of amounts collected on previously written-off or reserved accounts.

Blended Rate – The weighted average of New Lease Change and Renewal Rate Achieved.

Capital Expenditures to Real Estate:

Building Improvements – Includes roof replacement, paving, building mechanical equipment systems, exterior siding and painting, major landscaping, furniture, fixtures and equipment for amenities and common areas, vehicles and office and maintenance equipment.

Renovation Expenditures – Apartment unit renovation costs (primarily kitchens and baths) designed to reposition these units for higher rental levels in their respective markets.

Replacements – Includes appliances, mechanical equipment, fixtures and flooring (including hardwood and carpeting).

Debt Balances:

Commercial Paper Program – The Company may borrow up to a maximum of $1.0 billion under its commercial paper program subject to market conditions. The notes bear interest at various floating rates.

Revolving Credit Facility – The Company’s $2.5 billion unsecured revolving credit facility matures November 1, 2024. The interest rate on advances under the facility will generally be LIBOR plus a spread (currently 0.775%), or based on bids received from the lending group, and an annual facility fee (currently 0.125%). Both the spread and the facility fee are dependent on the Company’s senior unsecured credit rating. In addition, the Company limits its utilization of the facility in order to maintain liquidity to support its $1.0 billion commercial paper program along with certain other obligations. The following table presents the availability on the Company’s unsecured revolving credit facility:

		September 30, 2020
Unsecured revolving credit facility commitment		$	2,500,000
Commercial paper balance outstanding			—
Unsecured revolving credit facility balance outstanding			—
Other restricted amounts			(100,949	)
Unsecured revolving credit facility availability		$	2,399,051

Debt Covenant Compliance – Our unsecured debt includes certain financial and operating covenants including, among other things, maintenance of certain financial ratios. These provisions are contained in the indentures applicable to each notes payable or the credit agreement for our line of credit. The Debt Covenant Compliance ratios that are provided show the Company's compliance with certain covenants governing our public unsecured debt. These covenants generally reflect our most restrictive financial covenants. The Company was in compliance with its unsecured debt covenants for all periods presented.

Development Yield – NOI that the Company anticipates receiving in the next 12 months following stabilization less an estimate of property management costs/management fees allocated to the project (generally ranging from 2.0% to 4.0% of revenues depending on the size and income streams of the asset) and less an estimate for in-the-unit replacement capital expenditures (generally ranging from $50-$150 per apartment unit depending on the type of asset) divided by the Total Budgeted Capital Cost of the asset. The weighted average Development Yield for development properties is weighted based on the projected NOI streams and the relative Total Budgeted Capital Cost for each respective property.

Disposition Yield – NOI that the Company anticipates giving up in the next 12 months less an estimate of property management costs/management fees allocated to the project (generally ranging from 2.0% to 4.0% of revenues depending on the size and income streams of the asset) and less an estimate for in-the-unit replacement capital expenditures (generally ranging from $100-$450 per apartment unit depending on the age and condition of the asset) divided by the gross sales price of the asset. The weighted average Disposition Yield for sold properties is weighted based on the projected NOI streams and the relative sales price for each respective property.

Earnings Per Share ("EPS") – Net income per share calculated in accordance with GAAP. Expected EPS is calculated on a basis consistent with actual EPS. Due to the uncertain timing and extent of property dispositions and the resulting gains/losses on sales, actual EPS could differ materially from expected EPS.

EBITDA for Real Estate and Normalized EBITDA for Real Estate:

Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (“EBITDAre”) – The National Association of Real Estate Investment Trusts (“Nareit”) defines EBITDAre (September 2017 White Paper) as net income (computed in accordance with GAAP) before interest expense, income taxes, depreciation and amortization expense, and further adjusted for gains and losses from sales of depreciated operating properties, impairment write-downs of depreciated operating properties, impairment write-downs of investments in unconsolidated entities caused by a decrease in value of depreciated operating properties within the joint venture and adjustments to reflect the Company’s share of EBITDAre of investments in unconsolidated entities.

The Company believes that EBITDAre is useful to investors, creditors and rating agencies as a supplemental measure of the Company’s ability to incur and service debt because it is a recognized measure of performance by the real estate industry, and by excluding gains or losses related to sales or impairment of depreciated operating properties, EBITDAre can help compare the Company’s credit strength between periods or as compared to different companies.

Normalized Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (“Normalized EBITDAre”) – Represents net income (computed in accordance with GAAP) before interest expense, income taxes, depreciation and amortization expense, and further adjusted for non-comparable items. Normalized EBITDAre, total debt to Normalized EBITDAre and net debt to Normalized EBITDAre are important metrics in evaluating the credit strength of the Company and its ability to service its debt obligations. The Company believes that Normalized EBITDAre, total debt to Normalized EBITDAre, and net debt to Normalized EBITDAre are useful to investors, creditors and rating agencies because they allow investors to compare the Company’s credit strength to prior reporting periods and to other companies without the effect of items that by their nature are not comparable from period to period and tend to obscure the Company’s actual credit quality.

Economic Gain (Loss) – Economic Gain (Loss) is calculated as the net gain (loss) on sales of real estate properties in accordance with GAAP, excluding accumulated depreciation. The Company generally considers Economic Gain (Loss) to be an appropriate supplemental measure to net gain (loss) on sales of real estate properties in accordance with GAAP because it is one indication of the gross value created by the Company's acquisition, development, renovation, management and ultimate sale of a property and because it helps investors to understand the relationship between the cash proceeds from a sale and the cash invested in the sold property. The following table presents a reconciliation of net gain (loss) on sales of real estate properties in accordance with GAAP to Economic Gain (Loss):

		Nine Months Ended September 30, 2020				Quarter Ended September 30, 2020
Net Gain (Loss) on Sales of Real Estate Properties		$	352,218			$	(25	)
Accumulated Depreciation Gain			(157,471	)			-
Economic Gain (Loss)		$	194,747			$	(25	)

FFO and Normalized FFO:

Funds From Operations (“FFO”) – Nareit defines FFO (December 2018 White Paper) as net income (computed in accordance with GAAP), excluding gains or losses from sales and impairment write-downs of depreciable real estate and land when connected to the main business of a REIT, impairment write-downs of investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity and depreciation and amortization related to real estate. Adjustments for partially owned consolidated and unconsolidated partnerships and joint ventures are calculated to reflect FFO on the same basis. Expected FFO per share is calculated on a basis consistent with actual FFO per share and is considered an appropriate supplemental measure of expected operating performance when compared to expected EPS.

The Company believes that FFO and FFO available to Common Shares and Units are helpful to investors as supplemental measures of the operating performance of a real estate company, because they are recognized measures of performance by the real estate industry and by excluding gains or losses from sales and impairment write-downs of depreciable real estate and excluding depreciation related to real estate (which can vary among owners of identical assets in similar condition based on historical cost accounting and useful life estimates), FFO and FFO available to Common Shares and Units can help compare the operating performance of a company’s real estate between periods or as compared to different companies.

Normalized Funds From Operations ("Normalized FFO") – Normalized FFO begins with FFO and excludes:

• the impact of any expenses relating to non-operating asset impairment;

• pursuit cost write-offs;

• gains and losses from early debt extinguishment and preferred share redemptions;

• gains and losses from non-operating assets; and

• other miscellaneous items.

Expected Normalized FFO per share is calculated on a basis consistent with actual Normalized FFO per share and is considered an appropriate supplemental measure of expected operating performance when compared to expected EPS.

The Company believes that Normalized FFO and Normalized FFO available to Common Shares and Units are helpful to investors as supplemental measures of the operating performance of a real estate company because they allow investors to compare the Company's operating performance to its performance in prior reporting periods and to the operating performance of other real estate companies without the effect of items that by their nature are not comparable from period to period and tend to obscure the Company's actual operating results.

FFO, FFO available to Common Shares and Units, Normalized FFO and Normalized FFO available to Common Shares and Units do not represent net income, net income available to Common Shares or net cash flows from operating activities in accordance with GAAP. Therefore, FFO, FFO available to Common Shares and Units, Normalized FFO and Normalized FFO available to Common Shares and Units should not be exclusively considered as alternatives to net income, net income available to Common Shares or net cash flows from operating activities as determined by GAAP or as a measure of liquidity. The Company's calculation of FFO, FFO available to Common Shares and Units, Normalized FFO and Normalized FFO available to Common Shares and Units may differ from other real estate companies due to, among other items, variations in cost capitalization policies for capital expenditures and, accordingly, may not be comparable to such other real estate companies.

FFO available to Common Shares and Units and Normalized FFO available to Common Shares and Units are calculated on a basis consistent with net income available to Common Shares and reflects adjustments to net income for preferred distributions and premiums on redemption of preferred shares in accordance with GAAP. The equity positions of various individuals and entities that contributed their properties to the Operating Partnership in exchange for OP Units are collectively referred to as the "Noncontrolling Interests – Operating Partnership". Subject to certain restrictions, the Noncontrolling Interests – Operating Partnership may exchange their OP Units for Common Shares on a one-for-one basis.

The following table presents reconciliations of EPS to FFO per share and Normalized FFO per share for Consolidated Statements of Funds From Operations and Normalized Funds From Operations.

		Actual Sept.				Actual Sept.				Actual				Actual
		YTD 2020				YTD 2019				Q3 2020				Q3 2019
		Per Share				Per Share				Per Share				Per Share
EPS – Diluted		$	1.77			$	1.82			$	0.24			$	0.71
Depreciation expense			1.59				1.59				0.52				0.54
Net (gain) loss on sales			(0.88	)			(0.88	)			—				(0.33	)
Impairment – operating assets		—					—				—				—
FFO per share – Diluted			2.48				2.53				0.76				0.92
Impairment – non-operating assets			—				—				—				—
Write-off of pursuit costs			0.01				0.01				—				—
Debt extinguishment and preferred share
redemption (gains) losses			—				0.03				—				(0.01	)
Non-operating asset (gains) losses			—				—				—				—
Other miscellaneous items			—				0.01				0.01				—
Normalized FFO per share – Diluted		$	2.49			$	2.58			$	0.77			$	0.91

Lease-Up NOI – Represents NOI for development properties: (i) in various stages of lease-up; and (ii) where lease-up has been completed but the properties were not stabilized (defined as having achieved 90% occupancy for three consecutive months) for all of the current and comparable periods presented.

Leasing Concessions – Reflects upfront discounts on both new move-in and renewal leases on a straight-line basis.

Net Operating Income (“NOI”) – NOI is the Company’s primary financial measure for evaluating each of its apartment properties. NOI is defined as rental income less direct property operating expenses (including real estate taxes and insurance). 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. NOI does not include an allocation of property management expenses either in the current or comparable periods. Rental income for all leases and operating expense for ground leases (for both same store and non-same store properties) are reflected on a straight-line basis in accordance with GAAP for the current and comparable periods.

The following tables present reconciliations of operating income per the consolidated statements of operations to NOI, along with rental income, operating expenses and NOI per the consolidated statements of operations allocated between same store and non-same store/other results (see Same Store Results):

		Nine Months Ended September 30,								Quarter Ended September 30,
		2020				2019				2020				2019
Operating income		$	961,384			$	947,232			$	182,410			$	368,338
Adjustments:
Property management			71,513				72,705				20,196				21,940
General and administrative			37,212				41,127				10,859				11,417
Depreciation			619,003				616,201				200,605				211,478
Net (gain) loss on sales of real estate
properties			(352,218	)			(269,400	)			25				(130,565	)
Total NOI		$	1,336,894			$	1,407,865			$	414,095			$	482,608
Rental income:
Same store		$	1,854,383			$	1,900,820			$	603,097			$	652,330
Non-same store/other			103,887				115,976				19,336				32,790
Total rental income			1,958,270				2,016,796				622,433				685,120
Operating expenses:
Same store			586,707				576,070				203,158				196,863
Non-same store/other			34,669				32,861				5,180				5,649
Total operating expenses			621,376				608,931				208,338				202,512
NOI:
Same store			1,267,676				1,324,750				399,939				455,467
Non-same store/other			69,218				83,115				14,156				27,141
Total NOI		$	1,336,894			$	1,407,865			$	414,095			$	482,608

New Lease Change – The net effective change in rent (inclusive of Leasing Concessions) for a lease with a new or transferring resident compared to the rent for the prior lease of the identical apartment unit, regardless of lease term.

Non-Residential – Consists of revenues and expenses from retail and public parking garage operations.

Non-Same Store Properties – For annual comparisons, primarily includes all properties acquired during 2019 and 2020, plus any properties in lease-up and not stabilized as of January 1, 2019.

Physical Occupancy – The weighted average occupied apartment units for the reporting period divided by the average of total apartment units available for rent for the reporting period.

Renewal % – Leases renewed expressed as a percentage of total renewal offers extended during the reporting period.

Renewal Rate Achieved – The net effective change in rent (inclusive of Leasing Concessions) for a new lease on an apartment unit where the lease has been renewed as compared to the rent for the prior lease of the identical apartment unit, regardless of lease term.

Residential – Consists of multifamily apartment revenues and expenses.

Same Store Operating Expenses:

On-site Payroll – Includes payroll and related expenses for on-site personnel including property managers, leasing consultants, and maintenance staff.

Other On-site Operating Expenses – Includes ground lease costs and administrative costs such as office supplies, telephone and data charges and association and business licensing fees.

Repairs and Maintenance – Includes general maintenance costs, apartment unit turnover costs including interior painting, routine landscaping, security, exterminating, fire protection, snow removal, elevator, roof and parking lot repairs and other miscellaneous building repair and maintenance costs.

Utilities – Represents gross expenses prior to any recoveries under the Resident Utility Billing System (“RUBS”). Recoveries are reflected in rental income.

Same Store Properties – For annual comparisons, primarily includes all properties acquired or completed that are stabilized prior to January 1, 2019, less properties subsequently sold. Properties are included in Same Store when they are stabilized for all of the current and comparable periods presented.

Same Store Residential Revenues – Revenues from our Same Store Properties presented on a GAAP basis which reflects the impact of Leasing Concessions on a straight-line basis.

Same Store Residential Revenues with Leasing Concessions on a cash basis is considered by the Company to be a supplemental measure to Same Store Residential Revenues in conformity with GAAP to help investors evaluate the impact of both current and historical Leasing Concessions on GAAP-based Same Store Residential Revenues and to more readily enable comparisons to revenue as reported by other companies. Same Store Residential Revenues with Leasing Concessions on a cash basis reflects the impact of Leasing Concessions used in the period and allows an investor to understand the historical trend in cash Leasing Concessions.

The following table presents reconciliations of Same Store Residential Revenues on a GAAP basis to Same Store Residential Revenues with Leasing Concessions on a cash basis:

	Quarter over Quarter								Sequential								Year over Year
	Q3 2020				Q3 2019				Q3 2020				Q2 2020				Sept. YTD 2020				Sept. YTD 2019
Same Store Residential
Revenues (GAAP Basis)	$	597,210			$	628,345			$	613,726			$	630,951			$	1,811,101			$	1,829,896
Leasing Concessions amortized		3,973				675				4,376				1,666				5,821				2,665
Leasing Concessions granted		(11,585	)			(529	)			(12,183	)			(2,861	)			(15,329	)			(1,278	)
Same Store Residential
Revenues with Leasing
Concessions on a cash basis	$	589,598			$	628,491			$	605,919			$	629,756			$	1,801,593			$	1,831,283
% change - GAAP revenue		(5.0	%)							(2.7	%)							(1.0	%)
% change - cash revenue		(6.2	%)							(3.8	%)							(1.6	%)

% of Stabilized Budgeted NOI – Represents original budgeted 2020 NOI for stabilized properties and projected annual NOI at stabilization (defined as having achieved 90% occupancy for three consecutive months) for properties that are in lease-up.

Total Budgeted Capital Cost – Estimated remaining cost for projects under development and/or developed plus all capitalized costs incurred to date, including land acquisition costs, construction costs, capitalized real estate taxes and insurance, capitalized interest and loan fees, permits, professional fees, allocated development overhead and other regulatory fees, plus any estimates of costs remaining to be funded for all projects, all in accordance with GAAP.

Total Market Capitalization – The aggregate of the market value of the Company’s outstanding common shares, including restricted shares, the market value of the Company’s operating partnership units outstanding, including restricted units (based on the market value of the Company’s common shares) and the outstanding principal balance of debt. The Company believes this is a useful measure of a real estate operating company’s long-term liquidity and balance sheet strength, because it shows an approximate relationship between a company’s total debt and the current total market value of its assets based on the current price at which the Company’s common shares trade. However, because this measure of leverage changes with fluctuations in the Company’s share price, which occur regularly, this measure may change even when the Company’s earnings, interest and debt levels remain stable.

Traffic – Consists of an expression of interest in an apartment by completing an in-person tour, self-guided tour or virtual tour that may result in an application to lease.

Transaction Accretion (Dilution) – Represents the spread between the Acquisition Cap Rate and the Disposition Yield.

Turnover – Total Residential move-outs (including inter-property and intra-property transfers) divided by total Residential apartment units.

Unencumbered NOI % – Represents NOI generated by consolidated real estate assets unencumbered by outstanding secured debt as a percentage of total NOI generated by all of the Company's consolidated real estate assets.

Unlevered Internal Rate of Return (“IRR”) – The Unlevered IRR on sold properties is the compound annual rate of return calculated by the Company based on the timing and amount of: (i) the gross purchase price of the property plus any direct acquisition costs incurred by the Company; (ii) total revenues earned during the Company’s ownership period; (iii) total direct property operating expenses (including real estate taxes and insurance) incurred during the Company’s ownership period; (iv) capital expenditures incurred during the Company’s ownership period; and (v) the gross sales price of the property net of selling costs.

The calculation of the Unlevered IRR does not include an adjustment for the Company’s property management expense, general and administrative expense or interest expense (including loan assumption costs and other loan-related costs). Therefore, the Unlevered IRR is not a substitute for net income as a measure of our performance. Management believes that the Unlevered IRR achieved during the period a property is owned by the Company is useful because it is one indication of the gross value created by the Company’s acquisition, development, renovation, management and ultimate sale of a property, before the impact of Company overhead. The Unlevered IRR achieved on the properties as cited in this release should not be viewed as an indication of the gross value created with respect to other properties owned by the Company, and the Company does not represent that it will achieve similar Unlevered IRRs upon the disposition of other properties. The weighted average Unlevered IRR for sold properties is weighted based on all cash flows over the investment period for each respective property, including net sales proceeds.

Weighted Average Coupons – Contractual interest rate for each debt instrument weighted by principal balances as of September 30, 2020. In case of debt for which fair value hedges are in place, the rate payable under the corresponding derivatives is used in lieu of the contractual interest rate.

Weighted Average Rates – Interest expense for each debt instrument for the nine months ended September 30, 2020 weighted by its average principal balance for the same period. Interest expense includes amortization of premiums, discounts and other comprehensive income on debt and related derivative instruments. In case of debt for which derivatives are in place, the income or expense recognized under the corresponding derivatives is included in the total interest expense for the period.