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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended June 30, 2025

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

For the transition period from ________to _________

001-13106 (Essex Property Trust, Inc.)

333-44467-01 (Essex Portfolio, L.P.)

(Commission File Number)

ESSEX PROPERTY TRUST, INC.

ESSEX PORTFOLIO, L.P.

(Exact name of Registrant as Specified in its Charter)


Maryland						77-0369576
(Essex Property Trust, Inc.)						(Essex Property Trust, Inc.)
California						77-0369575
(Essex Portfolio, L.P.)						(Essex Portfolio, L.P.)
(State or Other Jurisdiction of Incorporation or Organization)						(I.R.S. Employer Identification Number)

1100 Park Place, Suite 200

San Mateo, California 94403

(Address of Principal Executive Offices, Including Zip Code)

(650) 655-7800

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading
Symbol(s)

Name of each exchange on which registered

Common Stock, $.0001 par value (Essex Property Trust, Inc.)

ESS

New York Stock Exchange

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

Essex Property Trust, Inc.

Yes

☒

☐

Essex Portfolio, L.P.

Yes

☒

☐

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

Essex Property Trust, Inc.

Yes

☒

☐

Essex Portfolio, L.P.

Yes

☒

☐

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

Essex Property Trust, Inc.:

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

Essex Portfolio, L.P.:

Large accelerated filer

☐

Accelerated filer

☐

Non-accelerated filer

☒

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.


Essex Property Trust, Inc.			☐			Essex Portfolio, L.P.			☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Essex Property Trust, Inc.

Yes

☐

☒

Essex Portfolio, L.P.

Yes

☐

☒

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 64,404,022 shares of Common Stock ($.0001 par value) of Essex Property Trust, Inc. were outstanding as of July 23, 2025.

EXPLANATORY NOTE

This report combines the reports on Form 10-Q for the three and six month periods ended June 30, 2025 of Essex Property Trust, Inc., a Maryland corporation, and Essex Portfolio, L.P., a California limited partnership of which Essex Property Trust, Inc. is the sole general partner.

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

Essex operates as a self-administered and self-managed real estate investment trust (“REIT”), and is the sole general partner of the Operating Partnership. As of June 30, 2025, Essex owned approximately 96.6% of the ownership interest in the Operating Partnership with the remaining 3.4% interest owned by limited partners. As the sole general partner of the Operating Partnership, Essex has exclusive control of the Operating Partnership’s day-to-day management.

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

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

•enhances investors’ understanding of Essex and the Operating Partnership by enabling investors to view the business as a whole in the same manner as management views and operates the business;

•eliminates duplicative disclosure and provides a more streamlined and readable presentation since a substantial portion of the disclosure applies to both Essex and the Operating Partnership; and

•creates time and cost efficiencies through the preparation of one combined report instead of two separate reports.

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

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

iii

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

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

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

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

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

The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the notes to such unaudited condensed consolidated financial statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations herein. Additionally, these unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Company’s annual report on Form 10-K for the year ended December 31, 2024.

ESSEX PROPERTY TRUST, INC.

ESSEX PORTFOLIO, L.P.

FORM 10-Q

TABLE OF CONTENTS


PART I. FINANCIAL INFORMATION		Page No.

Item 1.	Condensed Consolidated Financial Statements of Essex Property Trust, Inc. (Unaudited)

	Condensed Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024	2

	Condensed Consolidated Statements of Income and Comprehensive Income for the three and six months ended June 30, 2025 and 2024	3

	Condensed Consolidated Statements of Equity for the three and six months ended June 30, 2025 and 2024	4

	Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2025 and 2024	7

	Condensed Consolidated Financial Statements of Essex Portfolio, L.P. (Unaudited)

	Condensed Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024	9

	Condensed Consolidated Statements of Income and Comprehensive Income for the three and six months ended June 30, 2025 and 2024	10

	Condensed Consolidated Statements of Capital for the three and six months ended June 30, 2025 and 2024	11

	Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2025 and 2024	14

	Notes to Condensed Consolidated Financial Statements	16

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	38

Item 3.	Quantitative and Qualitative Disclosures About Market Risks	49

Item 4.	Controls and Procedures	50

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	51

Item 1A.	Risk Factors	51

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	51

Item 3.	Defaults Upon Senior Securities	52

Item 4.	Mine Safety Disclosures	52

Item 5.	Other Information	52

Item 6.	Exhibits	53

Signatures		54

Table of Contents

Part I – Financial Information

Item 1. Condensed Consolidated Financial Statements

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Unaudited)

(In thousands, except share amounts)


	June 30, 2025		December 31, 2024
ASSETS
Real estate investments:
Rental properties:
Land and land improvements	$	3,320,696	$	3,246,789
Buildings and improvements	14,652,727		14,342,729
	17,973,423		17,589,518
Less: accumulated depreciation	(6,263,819)		(6,150,618)
	11,709,604		11,438,900
Real estate under development	105,591		52,682
Co-investments	895,821		935,014
Real estate held for sale	47,653		—
	12,758,669		12,426,596
Cash and cash equivalents-unrestricted	58,679		66,795
Cash and cash equivalents-restricted	9,205		9,051
Marketable securities	82,162		69,794
Notes and other receivables, net of allowance for credit losses of $0.5 million as of both June 30, 2025 and December 31, 2024	138,096		206,706
Operating lease right-of-use assets	52,519		51,556
Prepaid expenses and other assets	82,160		96,861
Total assets	$	13,181,490	$	12,927,359
LIABILITIES AND EQUITY
Unsecured debt, net	$	5,519,922	$	5,473,788
Mortgage notes payable, net	874,532		989,884
Lines of credit and commercial paper	365,000		137,945
Accounts payable and accrued liabilities	188,708		212,747
Construction payable	27,069		14,347
Dividends payable	173,747		165,443
Distributions in excess of investments in co-investments	89,389		79,273
Liabilities associated with real estate held for sale	234		—
Operating lease liabilities	53,266		52,473
Other liabilities	50,787		50,220
Total liabilities	7,342,654		7,176,120
Commitments and contingencies (Note 11)
Redeemable noncontrolling interest	32,922		30,849
Equity:
Common stock; $0.0001 par value, 670,000,000 shares authorized; 64,403,865 and 64,280,466 shares issued and outstanding, respectively	6		6
Additional paid-in capital	6,685,714		6,668,047
Distributions in excess of accumulated earnings	(1,062,146)		(1,155,662)
Accumulated other comprehensive income, net	11,675		24,655
Total stockholders’ equity	5,635,249		5,537,046
Noncontrolling interest	170,665		183,344
Total equity	5,805,914		5,720,390
Total liabilities and equity	$	13,181,490	$	12,927,359

See accompanying notes to the unaudited condensed consolidated financial statements.

Table of Contents

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Income and Comprehensive Income

(Unaudited)

(In thousands, except share and per share amounts)


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Revenues:
Rental and other property	$	467,610	$	439,782	$	929,699	$	863,997
Management and other fees from affiliates	2,223		2,573		4,717		5,286
	469,833		442,355		934,416		869,283
Expenses:
Property operating, excluding real estate taxes	86,394		79,222		172,421		158,800
Real estate taxes	49,035		47,312		101,629		94,232
Corporate-level property management expenses	12,220		11,622		24,552		22,721
Depreciation and amortization	151,501		145,613		302,788		285,346
General and administrative	17,157		21,136		33,449		38,307
Expensed acquisition and investment related costs	—		—		—		68

	316,307		304,905		634,839		599,474
Gain on sale of real estate and land	126,174		—		237,204		—
Earnings from operations	279,700		137,450		536,781		269,809
Interest expense	(65,262)		(59,120)		(127,994)		(115,053)
Total return swap income	1,071		629		2,271		1,425
Interest and other income	6,808		9,568		11,097		66,843
Equity income from co-investments	8,977		9,652		22,186		22,018
Tax benefit on unconsolidated technology co-investments	232		807		395		758
Loss on early retirement of debt	—		—		(762)		—
Gain on remeasurement of co-investment	—		—		330		138,326
Net income	231,526		98,986		444,304		384,126
Net income attributable to noncontrolling interest	(10,164)		(6,072)		(19,832)		(18,481)
Net income available to common stockholders	$	221,362	$	92,914	$	424,472	$	365,645
Comprehensive income	$	227,447	$	96,499	$	430,870	$	389,634
Comprehensive income attributable to noncontrolling interest	(10,030)		(5,987)		(19,378)		(18,668)
Comprehensive income attributable to controlling interest	$	217,417	$	90,512	$	411,492	$	370,966
Per share data:
Basic:
Net income available to common stockholders	$	3.44	$	1.45	$	6.60	$	5.69
Weighted average number of shares outstanding during the period	64,385,988		64,209,878		64,350,640		64,207,482
Diluted:
Net income available to common stockholders	$	3.44	$	1.45	$	6.59	$	5.69
Weighted average number of shares outstanding during the period	64,407,613		64,227,651		64,378,953		64,218,911

See accompanying notes to the unaudited condensed consolidated financial statements.

Table of Contents

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Equity for the three and six months ended June 30, 2025 and 2024

(Unaudited)

(In thousands, except per share amounts)


	Common stock		Additional paid-in capital			Distributions in excess of accumulated earnings		Accumulated other comprehensive income, net		Noncontrolling interest		Total
Three Months Ended June 30, 2025		Shares			Amount
Balances at March 31, 2025		64,358	$	6		$	6,672,346	$	(1,117,971)	$	15,620	$	175,574	$	5,745,575
Net income		—	—			—		221,362		—		10,164		231,526

Change in fair value of derivatives and amortization of swap settlements		—	—			—		—		(4,013)		(136)		(4,149)
Change in fair value of marketable debt securities, net		—	—			—		—		68		2		70
Issuance of common stock under:
Stock option and restricted stock plans, net		19	—			2,902		—		—		—		2,902
Sale of common stock, net		—	—			(101)		—		—		—		(101)
Equity based compensation costs		—	—			2,279		—		—		80		2,359


Changes in the redemption value of redeemable noncontrolling interest		—	—			1,473		—		—		(19)		1,454

Distributions to noncontrolling interest		—	—			—		—		—		(8,185)		(8,185)
Redemptions of noncontrolling interest		27	—			6,815		—		—		(6,815)		—
Common stock dividends ($2.57 per share)		—	—			—		(165,537)		—		—		(165,537)
Balances at June 30, 2025		64,404	$	6		$	6,685,714	$	(1,062,146)	$	11,675	$	170,665	$	5,805,914

Table of Contents


	Common stock		Additional paid-in capital			Distributions in excess of accumulated earnings		Accumulated other comprehensive income, net		Noncontrolling Interest		Total
Six Months Ended June 30, 2025		Shares			Amount
Balances at December 31, 2024		64,280	$	6		$	6,668,047	$	(1,155,662)	$	24,655	$	183,344	$	5,720,390
Net income		—	—			—		424,472		—		19,832		444,304


Change in fair value of derivatives and amortization of swap settlements		—	—			—		—		(13,064)		(457)		(13,521)
Change in fair value of marketable debt securities, net		—	—			—		—		84		3		87
Issuance of common stock under:
Stock option and restricted stock plans, net		49	—			8,411		—		—		—		8,411
Sale of common stock, net		—	—			(101)		—		—		—		(101)
Equity based compensation costs		—	—			4,264		—		—		150		4,414

Changes in the redemption value of redeemable noncontrolling interest		—	—			(1,702)		—		—		(371)		(2,073)

Distributions to noncontrolling interest		—	—			—		—		—		(16,485)		(16,485)
Redemptions of noncontrolling interest		75	—			6,795		—		—		(15,351)		(8,556)
Common stock dividends ($5.14 per share)		—	—			—		(330,956)		—		—		(330,956)
Balances at June 30, 2025		64,404	$	6		$	6,685,714	$	(1,062,146)	$	11,675	$	170,665	$	5,805,914

Table of Contents


	Common stock		Additional paid-in capital			Distributions in excess of accumulated earnings		Accumulated other comprehensive income, net		Noncontrolling Interest		Total
Three Months Ended June 30, 2024		Shares			Amount
Balances at March 31, 2024		64,209	$	6		$	6,658,882	$	(1,152,136)	$	41,279	$	175,722	$	5,723,753
Net income		—	—			—		92,914		—		6,072		98,986
Change in fair value of derivatives and amortization of swap settlements		—	—			—		—		(2,402)		(85)		(2,487)
Issuance of common stock under:
Stock option and restricted stock plans, net		1	—			—		—		—		—		—
Sale of common stock, net		—	—			(105)		—		—		—		(105)
Equity based compensation costs		—	—			1,979		—		—		69		2,048

Changes in the redemption value of redeemable noncontrolling interest		—	—			(1,443)		—		—		(254)		(1,697)
Distributions to noncontrolling interest		—	—			—		—		—		(8,663)		(8,663)

Common stock dividends ($2.45 per share)		—	—			—		(157,335)		—		—		(157,335)
Balances at June 30, 2024		64,210	$	6		$	6,659,313	$	(1,216,557)	$	38,877	$	172,861	$	5,654,500

	Common stock		Additional paid-in capital			Distributions in excess of accumulated earnings		Accumulated other comprehensive income, net		Noncontrolling Interest		Total
Six Months Ended June 30, 2024		Shares			Amount
Balances at December 31, 2023		64,203	$	6		$	6,656,720	$	(1,267,536)	$	33,556	$	171,232	$	5,593,978
Net income		—	—			—		365,645		—		18,481		384,126
Change in fair value of derivatives and amortization of swap settlements		—	—			—		—		5,321		187		5,508
Issuance of common stock under:
Stock option and restricted stock plans, net		7	—			962		—		—		—		962
Sale of common stock, net		—	—			(113)		—		—		—		(113)
Equity based compensation costs		—	—			3,616		—		—		127		3,743

Changes in the redemption value of redeemable noncontrolling interest		—	—			(1,623)		—		—		(61)		(1,684)
Distributions to noncontrolling interest		—	—			—		—		—		(17,075)		(17,075)
Redemptions of noncontrolling interest		—	—			(249)		—		—		(30)		(279)
Common stock dividends ($4.90 per share)		—	—			—		(314,666)		—		—		(314,666)
Balances at June 30, 2024		64,210	$	6		$	6,659,313	$	(1,216,557)	$	38,877	$	172,861	$	5,654,500

See accompanying notes to the unaudited condensed consolidated financial statements.

Table of Contents

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)


	Six Months Ended June 30,
	2025		2024
Cash flows from operating activities:
Net income	$	444,304	$	384,126
Adjustments to reconcile net income to net cash provided by operating activities:
Straight-lined rents	332		419
Depreciation and amortization	302,788		285,346

Amortization of discount and debt financing costs, net	2,280		4,190
Realized and unrealized gains on marketable securities, net	(2,401)		(4,948)

Provision for credit losses	11		66


Equity income from co-investments	(22,186)		(22,018)
Operating distributions from co-investments	29,358		21,493
Accrued interest from notes and other receivables	(5,238)		(7,810)

Gain on the sale of real estate and land	(237,204)		—



Equity-based compensation	4,202		3,501
Loss on early retirement of debt	762		—
Gain on remeasurement of co-investment	(330)		(138,326)
Changes in operating assets and liabilities:
Prepaid expenses, receivables, operating lease right-of-use assets, and other assets	2,008		4,462
Accounts payable, accrued liabilities, and operating lease liabilities	(19,357)		5,365
Other liabilities	(1,697)		(2,084)
Net cash provided by operating activities	497,632		533,782
Cash flows from investing activities:
Additions to real estate:
Acquisitions of real estate and acquisition related capital expenditures, net of cash acquired	(585,132)		(489,486)
Redevelopment	(30,309)		(24,143)
Development acquisitions of and additions to real estate under development	(16,419)		(2,479)
Capital expenditures on rental properties	(64,450)		(60,982)

Investments in notes receivable	(281)		(56,553)
Collections of notes and other receivables	3,096		—
Proceeds from insurance for property losses	1,857		1,173
Proceeds from dispositions of real estate	364,155		—
Contributions to co-investments	(8,727)		(3,804)

Changes in refundable deposits	8,000		(1,000)
Purchases of marketable securities	(10,068)		(335)
Sales and maturities of marketable securities	188		8,787
Non-operating distributions from co-investments	18,000		6,500
Net cash used in investing activities	(320,090)		(622,322)
Cash flows from financing activities:
Proceeds from unsecured debt and mortgage notes	548,416		349,132
Payments on unsecured debt and mortgage notes	(615,502)		(401,533)
Proceeds from lines of credit and commercial paper	2,445,777		546,556
Repayments of lines of credit and commercial paper	(2,218,722)		(417,164)

Table of Contents


	Six Months Ended June 30,
	2025		2024
Additions to deferred charges	(5,393)		(3,000)
Payments related to debt prepayment penalties	(697)		—
Net costs from issuance of common stock	(101)		(113)

Net proceeds from stock options exercised	8,930		962
Payments related to tax withholding for share-based compensation	(519)		—

Distributions to noncontrolling interest	(16,213)		(16,544)
Redemption of noncontrolling interest	(8,556)		(279)

Common stock dividends paid	(322,924)		(305,660)
Net cash provided by financing activities	(185,504)		(247,643)
Net increase in unrestricted and restricted cash and cash equivalents	(7,962)		(336,183)
Unrestricted and restricted cash and cash equivalents at beginning of period	75,846		400,334
Unrestricted and restricted cash and cash equivalents at end of period	$	67,884	$	64,151

Supplemental disclosure of cash flow information:
Cash paid for interest (net of $1.4 million and $0.1 million capitalized in 2025 and 2024, respectively)	$	122,558	$	108,246
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	3,291	$	3,530
Supplemental disclosure of noncash investing and financing activities:











Reclassifications to redeemable noncontrolling interest from additional paid in capital and noncontrolling interest	$	2,073	$	1,684

Leased assets obtained in exchange for new operating lease liabilities	$	2,727	$	—

See accompanying notes to the unaudited condensed consolidated financial statements.

Table of Contents

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Unaudited)

(In thousands, except unit amounts)


	June 30, 2025		December 31, 2024
ASSETS
Real estate investments:
Rental properties:
Land and land improvements	$	3,320,696	$	3,246,789
Buildings and improvements	14,652,727		14,342,729
	17,973,423		17,589,518
Less: accumulated depreciation	(6,263,819)		(6,150,618)
	11,709,604		11,438,900
Real estate under development	105,591		52,682
Co-investments	895,821		935,014
Real estate held for sale	47,653		—
	12,758,669		12,426,596
Cash and cash equivalents-unrestricted	58,679		66,795
Cash and cash equivalents-restricted	9,205		9,051
Marketable securities	82,162		69,794
Notes and other receivables, net of allowance for credit losses of $0.5 million as of both June 30, 2025 and December 31, 2024	138,096		206,706
Operating lease right-of-use assets	52,519		51,556
Prepaid expenses and other assets	82,160		96,861
Total assets	$	13,181,490	$	12,927,359
LIABILITIES AND CAPITAL
Unsecured debt, net	$	5,519,922	$	5,473,788
Mortgage notes payable, net	874,532		989,884
Lines of credit and commercial paper	365,000		137,945
Accounts payable and accrued liabilities	188,708		212,747
Construction payable	27,069		14,347
Distributions payable	173,747		165,443
Distributions in excess of investments in co-investments	89,389		79,273
Liabilities associated with real estate held for sale	234		—
Operating lease liabilities	53,266		52,473
Other liabilities	50,787		50,220
Total liabilities	7,342,654		7,176,120
Commitments and contingencies (Note 11)
Redeemable noncontrolling interest	32,922		30,849

Capital:
General Partner:
Common equity (64,403,865 and 64,280,466 units issued and outstanding, respectively)	5,623,574		5,512,391
	5,623,574		5,512,391
Limited Partners:
Common equity (2,256,414 and 2,331,251 units issued and outstanding, respectively)	64,809		73,418
Accumulated other comprehensive income, net	15,995		29,429
Total partners’ capital	5,704,378		5,615,238
Noncontrolling interest	101,536		105,152
Total capital	5,805,914		5,720,390
Total liabilities and capital	$	13,181,490	$	12,927,359

See accompanying notes to the unaudited condensed consolidated financial statements.

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ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Condensed Consolidated Statements of Income and Comprehensive Income

(Unaudited)

(In thousands, except unit and per unit amounts)


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Revenues:
Rental and other property	$	467,610	$	439,782	$	929,699	$	863,997
Management and other fees from affiliates	2,223		2,573		4,717		5,286
	469,833		442,355		934,416		869,283
Expenses:
Property operating, excluding real estate taxes	86,394		79,222		172,421		158,800
Real estate taxes	49,035		47,312		101,629		94,232
Corporate-level property management expenses	12,220		11,622		24,552		22,721
Depreciation and amortization	151,501		145,613		302,788		285,346
General and administrative	17,157		21,136		33,449		38,307
Expensed acquisition and investment related costs	—		—		—		68

	316,307		304,905		634,839		599,474
Gain on sale of real estate and land	126,174		—		237,204		—
Earnings from operations	279,700		137,450		536,781		269,809
Interest expense	(65,262)		(59,120)		(127,994)		(115,053)
Total return swap income	1,071		629		2,271		1,425
Interest and other income	6,808		9,568		11,097		66,843
Equity income from co-investments	8,977		9,652		22,186		22,018
Tax benefit on unconsolidated technology co-investments	232		807		395		758
Loss on early retirement of debt	—		—		(762)		—
Gain on remeasurement of co-investment	—		—		330		138,326
Net income	231,526		98,986		444,304		384,126
Net income attributable to noncontrolling interest	(2,383)		(2,802)		(4,772)		(5,612)
Net income available to common unitholders	$	229,143	$	96,184	$	439,532	$	378,514
Comprehensive income	$	227,447	$	96,499	$	430,870	$	389,634
Comprehensive income attributable to noncontrolling interest	(2,383)		(2,802)		(4,772)		(5,612)
Comprehensive income attributable to controlling interest	$	225,064	$	93,697	$	426,098	$	384,022
Per unit data:
Basic:
Net income available to common unitholders	$	3.44	$	1.45	$	6.60	$	5.69
Weighted average number of common units outstanding during the period	66,649,159		66,468,691		66,635,581		66,466,295
Diluted:
Net income available to common unitholders	$	3.44	$	1.45	$	6.59	$	5.69
Weighted average number of common units outstanding during the period	66,670,784		66,486,464		66,663,894		66,477,724

See accompanying notes to the unaudited condensed consolidated financial statements.

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ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Condensed Consolidated Statements of Capital for the three and six months ended June 30, 2025 and 2024

(Unaudited)

(In thousands, except per unit amounts)


	General Partner				Limited Partners				Accumulated other comprehensive income, net		Noncontrolling interest		Total
	Common Equity				Common Equity
Three Months Ended June 30, 2025	Units	Amount		Units		Amount
Balances at March 31, 2025	64,358	$	5,554,381		2,283		$	69,653	$	20,074	$	101,467	$	5,745,575
Net income	—	221,362			—		7,781		—		2,383		231,526

Change in fair value of derivatives and amortization of swap settlements	—	—			—		—		(4,149)		—		(4,149)
Change in fair value of marketable debt securities	—	—			—		—		70		—		70
Issuance of common units under:
General partner’s stock based compensation, net	19	2,902			—		—		—		—		2,902
Sale of common stock by general partner, net	—	(101)			—		—		—		—		(101)
Equity based compensation costs	—	2,279			—		80		—		—		2,359

Changes in the redemption value of redeemable noncontrolling interest	—	1,473			—		(91)		—		72		1,454

Distributions to noncontrolling interest	—	—			—		—		—		(2,386)		(2,386)
Redemptions	27	6,815			(27)		(6,815)		—		—		—
Distributions declared ($2.57 per unit)	—	(165,537)			—		(5,799)		—		—		(171,336)
Balances at June 30, 2025	64,404	$	5,623,574		2,256		$	64,809	$	15,995	$	101,536	$	5,805,914

Table of Contents


	General Partner			Limited Partners			Accumulated other comprehensive income, net		Noncontrolling interest		Total
	Common Equity			Common Equity
Six Months Ended June 30, 2025	Units	Amount		Units	Amount
Balances at December 31, 2024	64,280	$	5,512,391	2,331	$	73,418	$	29,429	$	105,152	$	5,720,390
Net income	—	424,472		—	15,060		—		4,772		444,304


Change in fair value of derivatives and amortization of swap settlements	—	—		—	—		(13,521)		—		(13,521)
Change in fair value of marketable debt securities	—	—		—	—		87		—		87
Issuance of common units under:
General partner's stock based compensation, net	49	8,411		—	—		—		—		8,411
Sale of common stock by general partner, net	—	(101)		—	—		—		—		(101)
Equity based compensation costs	—	4,264		—	150		—		—		4,414


Changes in the redemption value of redeemable noncontrolling Interest	—	(1,702)		—	(310)		—		(61)		(2,073)

Distributions to noncontrolling interest	—	—		—	—		—		(4,817)		(4,817)
Redemptions	75	6,795		(75)	(11,841)		—		(3,510)		(8,556)
Distributions declared ($5.14 per unit)	—	(330,956)		—	(11,668)		—		—		(342,624)
Balances at June 30, 2025	64,404	$	5,623,574	2,256	$	64,809	$	15,995	$	101,536	$	5,805,914

Table of Contents


	General Partner				Limited Partners				Accumulated other comprehensive income, net		Noncontrolling interest		Total
	Common Equity				Common Equity
Three Months Ended June 30, 2024	Units	Amount		Units		Amount
Balances at March 31, 2024	64,209	$	5,506,752		2,259		$	49,276	$	46,641	$	121,084	$	5,723,753
Net income	—	92,914			—		3,270		—		2,802		98,986
Change in fair value of derivatives and amortization of swap settlements	—	—			—		—		(2,487)		—		(2,487)
Issuance of common units under:
General partner's stock based compensation, net	1	—			—		—		—		—		—
Sale of common stock by general partner, net	—	(105)			—		—		—		—		(105)
Equity based compensation costs	—	1,979			—		69		—		—		2,048

Changes in the redemption value of redeemable noncontrolling interest	—	(1,443)			—		(263)		—		9		(1,697)
Distributions to noncontrolling interest	—	—			—		—		—		(3,130)		(3,130)

Distributions declared ($2.45 per unit)	—	(157,335)			—		(5,533)		—		—		(162,868)
Balances at June 30, 2024	64,210	$	5,442,762		2,259		$	46,819	$	44,154	$	120,765	$	5,654,500

	General Partner				Limited Partners				Accumulated other comprehensive income, net		Noncontrolling interest		Total
	Common Equity				Common Equity
Six Months Ended June 30, 2024	Units	Amount			Units		Amount
Balances at December 31, 2023	64,203	$	5,389,190		2,259		$	44,991	$	38,646	$	121,151	$	5,593,978
Net income	—	365,645			—		12,869		—		5,612		384,126
Change in fair value of derivatives and amortization of swap settlements	—	—			—		—		5,508		—		5,508
Issuance of common units under:
General partner's stock based compensation, net	7	962			—		—		—		—		962
Sale of common stock by general partner, net	—	(113)			—		—		—		—		(113)
Equity based compensation costs	—	3,616			—		127		—		—		3,743
Changes in the redemption value of redeemable noncontrolling interest	—	(1,623)			—		(98)		—		37		(1,684)

Distributions to noncontrolling interest	—	—			—		—		—		(6,005)		(6,005)
Redemptions	—	(249)			—		—		—		(30)		(279)
Distributions declared ($4.90 per unit)	—	(314,666)			—		(11,070)		—		—		(325,736)
Balances at June 30, 2024	64,210	$	5,442,762		2,259		$	46,819	$	44,154	$	120,765	$	5,654,500

See accompanying notes to the unaudited condensed consolidated financial statements.

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ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)


	Six Months Ended June 30,
	2025		2024
Cash flows from operating activities:
Net income	$	444,304	$	384,126
Adjustments to reconcile net income to net cash provided by operating activities:
Straight-lined rents	332		419
Depreciation and amortization	302,788		285,346

Amortization of discount and debt financing costs, net	2,280		4,190
Realized and unrealized gains on marketable securities, net	(2,401)		(4,948)

Provision for credit losses	11		66


Equity income from co-investments	(22,186)		(22,018)
Operating distributions from co-investments	29,358		21,493
Accrued interest from notes and other receivables	(5,238)		(7,810)

Gain on the sale of real estate and land	(237,204)		—



Equity-based compensation	4,202		3,501
Loss on early retirement of debt	762		—
Gain on remeasurement of co-investment	(330)		(138,326)
Changes in operating assets and liabilities:
Prepaid expenses, receivables, operating lease right-of-use assets, and other assets	2,008		4,462
Accounts payable, accrued liabilities, and operating lease liabilities	(19,357)		5,365
Other liabilities	(1,697)		(2,084)
Net cash provided by operating activities	497,632		533,782
Cash flows from investing activities:
Additions to real estate:
Acquisitions of real estate and acquisition related capital expenditures, net of cash acquired	(585,132)		(489,486)
Redevelopment	(30,309)		(24,143)
Development acquisitions of and additions to real estate under development	(16,419)		(2,479)
Capital expenditures on rental properties	(64,450)		(60,982)

Investments in notes receivable	(281)		(56,553)
Collections of notes and other receivables	3,096		—
Proceeds from insurance for property losses	1,857		1,173
Proceeds from dispositions of real estate	364,155		—
Contributions to co-investments	(8,727)		(3,804)
Changes in refundable deposits	8,000		(1,000)
Purchases of marketable securities	(10,068)		(335)
Sales and maturities of marketable securities	188		8,787
Non-operating distributions from co-investments	18,000		6,500
Net cash used in investing activities	(320,090)		(622,322)
Cash flows from financing activities:
Proceeds from unsecured debt and mortgage notes	548,416		349,132
Payments on unsecured debt and mortgage notes	(615,502)		(401,533)
Proceeds from lines of credit and commercial paper	2,445,777		546,556
Repayments of lines of credit and commercial paper	(2,218,722)		(417,164)


Additions to deferred charges	(5,393)		(3,000)

Table of Contents


	Six Months Ended June 30,
	2025		2024
Payments related to debt prepayment penalties	(697)		—
Net costs from issuance of common units	(101)		(113)

Net proceeds from stock options exercised	8,930		962
Payments related to tax withholding for share-based compensation	(519)		—

Distributions to noncontrolling interest	(4,718)		(4,454)
Redemption of noncontrolling interests	(8,556)		(279)

Common units distributions paid	(334,419)		(317,750)
Net cash provided by financing activities	(185,504)		(247,643)
Net increase in unrestricted and restricted cash and cash equivalents	(7,962)		(336,183)
Unrestricted and restricted cash and cash equivalents at beginning of period	75,846		400,334
Unrestricted and restricted cash and cash equivalents at end of period	$	67,884	$	64,151

Supplemental disclosure of cash flow information:
Cash paid for interest (net of $1.4 million and $0.1 million capitalized in 2025 and 2024, respectively)	$	122,558	$	108,246
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	3,291	$	3,530
Supplemental disclosure of noncash investing and financing activities:











Reclassifications to redeemable noncontrolling interest from general and limited partner capital and noncontrolling interest	$	2,073	$	1,684

Leased assets obtained in exchange for new operating lease liabilities	$	2,727	$	—

See accompanying notes to the unaudited condensed consolidated financial statements.

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ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

(1) Organization and Basis of Presentation

The accompanying unaudited condensed consolidated financial statements present the accounts of Essex Property Trust, Inc. (“Essex” or the “Company”), which include the accounts of the Company and Essex Portfolio, L.P. and its subsidiaries (the “Operating Partnership,” which holds the operating assets of the Company), prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q. In the opinion of management, all adjustments necessary for a fair presentation of the financial position, results of operations, and cash flows for the periods presented have been included and are normal and recurring in nature. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Company’s annual report on Form 10-K for the year ended December 31, 2024. Unless otherwise indicated, the notes to condensed consolidated financial statements apply to both the Company and the Operating Partnership.

All significant intercompany accounts and transactions have been eliminated in the unaudited condensed consolidated financial statements. Certain reclassifications have been made to conform to the current year's presentation.

The unaudited condensed consolidated financial statements for the three and six months ended June 30, 2025 and 2024 include the accounts of the Company and the Operating Partnership. Essex is the sole general partner of the Operating Partnership, with a 96.6% and 96.5% general partnership interest as of June 30, 2025 and December 31, 2024, respectively. Total Operating Partnership limited partnership units (“OP Units,” and the holders of such OP Units, “Unitholders”) outstanding were 2,256,414 and 2,331,251 as of June 30, 2025 and December 31, 2024, respectively, and the redemption value of the units, based on the closing price of the Company’s common stock totaled approximately $639.5 million and $665.4 million as of June 30, 2025 and December 31, 2024, respectively. The Company has reserved shares of common stock for such conversions.

As of June 30, 2025, the Company owned or had ownership interests in 259 operating apartment communities, comprising 62,842 apartment homes, excluding the Company’s ownership interests in preferred equity co-investments, loan investments, two operating commercial buildings, and a development pipeline consisting of one consolidated project. The operating apartment communities are located in Southern California (primarily Los Angeles, Orange, San Diego, and Ventura counties), Northern California (the San Francisco Bay Area) and the Seattle metropolitan area.

Recent Accounting Pronouncements

In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2024-03 “Income Statement —Reporting Comprehensive Income —Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses”, and in January 2025, the FASB issued ASU No. 2025-01 “Income Statement —Reporting Comprehensive Income —Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date”. ASU 2024-03 requires disaggregated information for specified categories of expenses to be presented in the notes to the financial statements. ASU 2024-03, as clarified by ASU 2025-01, is effective for annual periods beginning January 1, 2027 and interim periods beginning January 1, 2028. Early adoption is permitted. The new standards may be applied either prospectively, to financial statements issued after the effective date, or retrospectively, to all prior periods presented. The Company is currently evaluating the impact of these standards on its consolidated results of operations and financial position.

Accounting Pronouncements Adopted in the Current Year

In August 2023, the FASB issued ASU No. 2023-05 “Business Combinations—Joint Venture Formations (Subtopic 805-60)” under which an entity that qualifies as a joint venture is required to apply a new basis of accounting upon the formation of the joint venture. The amendments in ASU 2023-05 require that a joint venture must initially measure its assets and liabilities at fair value on the formation date. ASU 2023-05 is effective for all joint ventures that are formed on or after January 1, 2025 and early adoption is permitted. The Company adopted ASU No. 2023-05 as of January 1, 2025. This adoption did not have a material impact on the Company’s consolidated results of operations or financial position.

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

Revenues and Gains on Sale of Real Estate and Land

Revenues from tenants renting or leasing apartment homes are recorded when due from tenants and are recognized monthly as they are earned which generally approximates a straight-line basis, else, adjustments are made to conform to a straight-line basis. Apartment homes are rented under short-term leases (generally, lease terms of 9 to 12 months). Revenues from tenants leasing commercial space are recorded on a straight-line basis over the life of the respective lease. See Note 3, Revenues, for additional information regarding such revenues.

The Company also generates other property-related revenue associated with the leasing of apartment homes, including storage income, pet rent, and other miscellaneous revenue. Similar to rental income, such revenues are recorded when due from tenants and recognized monthly as they are earned.

Apart from rental and other property-related revenue, revenues from contracts with customers are recognized as control of the promised services is passed to the customer. For customer contracts related to management and other fees from affiliates (which includes asset management and property management), the transaction price and amount of revenue to be recognized is determined each quarter based on the management fee calculated and earned for that month or quarter. The contract will contain a description of the service and the fee percentage for management services. Payments from such services are one month or one quarter in arrears of the service performed.

The Company recognizes any gains on sales of real estate when it transfers control of a property and when it is probable that the Company will collect substantially all of the related consideration.

Marketable Securities

The Company reports its equity securities and available-for-sale debt securities at fair value, based on quoted market prices (Level 1 for the equity securities and Level 2 for the available for sale debt securities, as defined by the FASB standard for fair value measurements). As of both June 30, 2025 and December 31, 2024, less than $0.1 million of equity securities presented within common stock, preferred stock, and stock funds in the tables below represented investments measured at fair value, using net asset value as a practical expedient, and were not categorized in the fair value hierarchy.

Any unrealized gain or loss in debt securities classified as available for sale is recorded as other comprehensive income. Any realized and unrealized gains and losses in equity securities, realized gains in debt securities, and interest income are included in interest and other income in the condensed consolidated statements of income and comprehensive income. There were no other-than-temporary impairment charges for the three and six months ended June 30, 2025 and 2024.

As of June 30, 2025 and December 31, 2024, equity securities and available for sale debt securities consisted primarily of investment funds-debt securities, common stock, preferred stock and stock funds, U.S. treasury securities, corporate debt securities and municipal debt securities.

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

As of June 30, 2025 and December 31, 2024, marketable securities consisted of the following ($ in thousands):


	June 30, 2025
	Amortized Cost		Gross Unrealized Gain (Loss)		Carrying Value
Equity securities:
Investment funds - debt securities	$	2,676	$	(23)	$	2,653
Common stock, preferred stock and stock funds	49,247		20,367		69,614

Debt securities:
Available for sale
U.S. treasury securities	4,882		28		4,910
Corporate debt securities	4,619		55		4,674
Municipal debt securities	307		4		311
Total - Marketable securities	$	61,731	$	20,431	$	82,162


	December 31, 2024
	Amortized Cost		Gross Unrealized Gain (Loss)		Carrying Value
Equity securities:
Investment funds - debt securities	$	2,645	$	(67)	$	2,578
Common stock, preferred stock and stock funds	49,195		18,021		67,216

Total - Marketable securities	$	51,840	$	17,954	$	69,794

Variable Interest Entities

In accordance with accounting standards for consolidation of variable interest entities (“VIEs”), the Company consolidated the Operating Partnership, 18 DownREIT entities (comprising ten communities), and four co-investments as of June 30, 2025. As of December 31, 2024, the Company consolidated the Operating Partnership, 18 DownREIT entities (comprising nine communities) and five co-investments. The Company consolidates these entities because it is the primary beneficiary. The Company has no assets or liabilities other than its investment in the Operating Partnership. The consolidated total assets and liabilities related to the above consolidated co-investments and DownREIT entities, net of intercompany eliminations, were $942.6 million and $243.9 million, respectively, as of June 30, 2025 and $893.0 million and $319.1 million, respectively, as of December 31, 2024. Noncontrolling interests in these entities was $101.4 million and $105.1 million as of June 30, 2025 and December 31, 2024, respectively. The Company’s financial risk in each VIE is limited to its equity investment in the VIE. As of June 30, 2025 and December 31, 2024, the Company did not have any VIEs of which it was not the primary beneficiary.

Equity-based Compensation

The cost of share- and unit-based compensation awards is measured at the grant date based on the estimated fair value of the awards. The estimated fair value of stock options and restricted stock granted by the Company are being amortized over the vesting period. The estimated grant date fair values of the long term incentive plan units (discussed in Note 14, Equity Based Compensation Plans, in the Company’s annual report on Form 10-K for the year ended December 31, 2024) are being amortized over the expected service periods.

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

Fair Value of Financial Instruments

Management estimates that the carrying amounts of the outstanding balances under its lines of credit, commercial paper and notes and other receivables approximate fair value as of June 30, 2025 and December 31, 2024, because interest rates, yields, and other terms for these instruments are consistent with interest rates, yields, and other terms currently available for similar instruments. Management has estimated that the fair value of the Company’s fixed rate debt with a carrying value of $5.6 billion and $5.8 billion as of June 30, 2025 and December 31, 2024, respectively, was approximately $5.4 billion and $5.5 billion, respectively. Management has estimated that the fair value of the Company’s $1.1 billion and $752.3 million of variable rate debt at June 30, 2025 and December 31, 2024, respectively, was approximately $1.1 billion and $749.4 million, respectively, based on the terms of existing mortgage notes payable, unsecured debt, lines of credit and commercial paper compared to those available in the marketplace. Management estimated that the carrying amounts of cash and cash equivalents, restricted cash, accounts payable and accrued liabilities, construction payables, other liabilities and dividends payable approximate fair value as of June 30, 2025 and December 31, 2024 due to the short-term maturity of these instruments. Marketable securities are carried at fair value as of June 30, 2025 and December 31, 2024.

Capitalization of Costs

The Company’s capitalized costs related to development and redevelopment projects were comprised primarily of interest and employee compensation and totaled $6.1 million and $4.9 million during the three months ended June 30, 2025 and 2024, respectively, and $12.3 million and $10.2 million for the six months ended June 30, 2025 and 2024, respectively. The Company amortizes the capitalized costs over the useful life of the development.

Co-investments

The Company owns investments in joint ventures in which it has significant influence, but its ownership interest does not meet the criteria for consolidation in accordance with U.S. GAAP. Therefore, the Company accounts for co-investments using the equity method of accounting. Under the equity method of accounting, the investment is carried at the cost of assets contributed, plus the Company’s equity in earnings, less distributions received and the Company’s share of losses. The significant accounting policies of the Company’s co-investment entities are consistent with those of the Company in all material respects.

Upon the acquisition of a controlling interest of a co-investment, the co-investment entity is consolidated and a gain or loss is recognized upon the remeasurement of co-investments in the condensed consolidated statements of income and comprehensive income equal to the amount by which the fair value of the co-investment interest, using Level 2 inputs, exceeds the Company’s carrying value of the co-investment. A majority of the co-investments, excluding most preferred equity investments, compensate the Company for its asset management services and some of these investments may provide promote income if certain financial return benchmarks are achieved. Asset management fees are recognized when earned, and promote fees are recognized when the earnings events have occurred and the amount is determinable and collectible. Any promote fees are reflected in equity income from co-investments.

The Company evaluates its investments in co-investments for impairment and records a loss if the carrying value is greater than the fair value of the investment and the impairment is other-than-temporary.

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

Changes in Accumulated Other Comprehensive Income, Net by Component

Essex Property Trust, Inc.

($ in thousands):


	Change in fair value and amortization of swap settlements		Unrealized gain on available for sale debt securities		Total
Balance at December 31, 2024	$	24,655	$	—	$	24,655

Other comprehensive loss before reclassification	(15,315)		84		(15,231)
Amounts reclassified from accumulated other comprehensive income	2,251		—		2,251
Other comprehensive loss	(13,064)		84		(12,980)
Balance at June 30, 2025	$	11,591	$	84	$	11,675

Essex Portfolio, L.P.

($ in thousands):


	Change in fair value and amortization of swap settlements		Unrealized gain on available for sale debt securities		Total
Balance at December 31, 2024	$	29,429	$	—	$	29,429

Other comprehensive loss before reclassification	(15,852)		87		(15,765)
Amounts reclassified from accumulated other comprehensive income	2,331		—		2,331
Other comprehensive loss	(13,521)		87		(13,434)
Balance at June 30, 2025	$	15,908	$	87	$	15,995

Amounts reclassified from accumulated other comprehensive loss in connection with derivatives are recorded in interest expense in the condensed consolidated statements of income and comprehensive income.

Redeemable Noncontrolling Interest

The carrying value of redeemable noncontrolling interests in the accompanying condensed consolidated balance sheets was $32.9 million and $30.8 million as of June 30, 2025 and December 31, 2024, respectively. The limited partners may redeem their noncontrolling interests for cash in certain circumstances.

The changes in the redemption value of redeemable noncontrolling interests for the six months ended June 30, 2025 was as follows ($ in thousands):


Balance at December 31, 2024	$	30,849
Reclassification due to change in redemption value and other	2,073


Balance at June 30, 2025	$	32,922

Cash, Cash Equivalents and Restricted Cash

Highly liquid investments generally with original maturities of three months or less when purchased are classified as cash equivalents. Restricted cash balances relate primarily to reserve requirements for capital replacement at certain communities in connection with the Company’s mortgage debt.

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the condensed consolidated statements of cash flows ($ in thousands):


	June 30, 2025		December 31, 2024		June 30, 2024		December 31, 2023
Cash and cash equivalents - unrestricted	$	58,679	$	66,795	$	55,223	$	391,749
Cash and cash equivalents - restricted	9,205		9,051		8,928		8,585
Total unrestricted and restricted cash and cash equivalents shown in the condensed consolidated statements of cash flows	$	67,884	$	75,846	$	64,151	$	400,334

Gain Contingencies

Contingencies, commonly resulting from legal settlements, will periodically arise that may result in a gain. Gain contingencies are typically not recognized in the financial statements until all uncertainties related to the contingency have been resolved. In the case of legal settlements, the Company determines that all uncertainties have been resolved when cash or other consideration has been received by the Company. There were no material gains from legal settlements during the three and six months ended June 30, 2025 and the three months ended June 30, 2024. During the six months ended June 30, 2024, the Company settled two lawsuits related to construction defects at two communities and received cash recoveries of $42.5 million. The Company determined that all uncertainties were resolved upon receipt of cash and recorded a gain within interest and other income on the condensed consolidated statements of income and comprehensive income.

Accounting Estimates

The preparation of condensed consolidated financial statements, in accordance with U.S. GAAP, requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. On an on-going basis, the Company evaluates its estimates, including those related to acquiring, developing and assessing the carrying values of its real estate portfolio, its investments in and advances to joint ventures and affiliates, its notes receivables, and its qualification as a real estate investment trust (“REIT”). The Company bases its estimates on historical experience, current market conditions, and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may vary from those estimates and those estimates could be different under different assumptions or conditions.

(2) Significant Transactions During the Six Months Ended June 30, 2025 and Subsequent Events

Significant Transactions

Acquisition of Real Estate Interests

The table below summarizes acquisition activity for the six months ended June 30, 2025 ($ in millions):


Property Name	Location	Date	Apartment Homes	Contract Price at Pro Rata Share
The Plaza	CA	Jan-25	307	$	161.4
One Hundred Grand	CA	Feb-25	166	105.3		(1)
ROEN Menlo Park	CA	Feb-25	146	78.8
Revere Campbell	CA	May-25	168	118.0		(1)
The Parc at Pruneyard	CA	May-25	252	122.5

Total acquisitions			1,039	$	586.0

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

(1) One Hundred Grand and Revere Campbell replaced Highridge, an apartment community owned by DownREIT entities that are consolidated by the Company, within the DownREIT structures of those entities pursuant to the like-kind exchange rules under Section 1031 of the Internal Revenue Code of 1986, as amended (“Section 1031 Exchange”).

Disposition of Real Estate Interests

The table below summarizes disposition activity for the six months ended June 30, 2025 ($ in millions):


Property Name	Location	Date	Apartment Homes	Sale Price at Pro Rata Share
Highridge	CA	Feb-25	255	$	127.0	(1)
Essex Skyline	CA	Apr-25	350	239.6		(2)

Total dispositions			605	$	366.6

(1) Highridge, an apartment community owned by DownREIT entities that are consolidated by the Company, was replaced by One Hundred Grand and Revere Campbell within the DownREIT structures of those entities pursuant to a Section 1031 Exchange. The Company recognized a $111.0 million gain on sale of real estate and land in the condensed consolidated statements of income and comprehensive income. In conjunction with the sale, $69.6 million in debt associated with the property was paid off and the Company recorded a $0.8 million loss on early extinguishment of debt.

(2) The Company recognized a $126.2 million gain on sale in the condensed consolidated statements of income and comprehensive income.

Real Estate Assets Held for Sale

As of June 30, 2025, one community comprising of 243 apartment homes was classified as held for sale.

Preferred Equity Investments

In April 2025, the Company received cash of $14.1 million for the full redemption of a preferred equity investment in a joint venture that holds property located in Washington.

In March 2025, the Company received cash of $9.9 million for the full redemption of a preferred equity investment in a joint venture that holds property located in California.

In the fourth quarter of 2024, the Company repaid a $72.0 million senior mortgage associated with a $22.7 million preferred equity investment in Artizan, a 241-unit stabilized apartment home community located in Oakland, CA, and subsequently issued a default notice to the third-party sponsor in January 2025, assumed full managerial control and consolidated the property based on a valuation of $95.0 million. The Company recorded $0.3 million as a gain on remeasurement of co-investment in the condensed consolidated statements of income and comprehensive income.

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

Senior Unsecured Debt

In May 2025, the Operating Partnership obtained a $300.0 million unsecured term loan priced at Secured Overnight Financing Rate (“SOFR”) plus 0.850%. The loan is scheduled to mature in May 2028, with two one-year extension options, exercisable at the option of the Company. The loan includes a twelve-month delayed draw feature. The Company may elect to increase this facility by up to an additional $300.0 million, to an aggregate size of $600.0 million, if the lenders permit. As of June 30, 2025, the Company had borrowed $150.0 million under the term loan facility. The Company has entered into floating-to-fixed interest rate swaps to fix the interest rate for $150.0 million of the term loan facility to an all-in rate of 4.1% through April 2030.

In May 2025, the Operating Partnership entered into a closing agreement to increase its $1.2 billion unsecured line of credit (“Prior Revolving Credit Facility”) to $1.5 billion (“New Credit Facility”). The replacement of the Prior Revolving Credit Facility was completed and became effective in July 2025. The underlying interest rate will be SOFR plus 0.775% which is based on a tiered rate structure tied to the Company’s credit ratings. The New Credit Facility is scheduled to mature in January 2030, with two six-month extensions exercisable at the option of the Company. The Company may also elect to increase the facility by up to an additional $1.0 billion, to an aggregate size of $2.5 billion, if the lenders permit.

In May 2025, the Company established a commercial paper program (the “Commercial Paper Program”) to issue unsecured commercial paper notes with varying maturities up to 397 days from the date of issue (the “Notes”). Amounts available under the Commercial Paper Program may be borrowed, repaid and re-borrowed from time to time, with the maximum aggregate face or principal amount outstanding at any one time not exceeding $750.0 million. The Company’s unsecured line of credit facilities serve as a liquidity backstop and any issuances under the Commercial Paper Program reduce the available borrowing capacity. The Notes rank equally in right of payment with all other senior unsecured senior obligations of the Operating Partnership and are unconditionally guaranteed by the Company.

In February 2025, the Operating Partnership issued $400.0 million of senior unsecured notes due on April 1, 2035 with a coupon rate of 5.375% per annum (the “2035 Notes”), which are payable on April 1 and October 1 of each year, beginning on October 1, 2025. The 2035 Notes were offered to investors at a price of 99.604% of the principal amount. The 2035 Notes are general unsecured senior obligations of the Operating Partnership, rank equally in right of payment with all other senior unsecured indebtedness of the Operating Partnership and are unconditionally guaranteed by Essex. In April 2025, the Company repaid its $500.0 million unsecured notes at maturity.

Subsequent events

Subsequent to quarter end, the Company formed a new joint venture, Wesco VII, LLC (“Wesco VII”), with the State of Wisconsin Investment Board with a total commitment from each partner of $50.0 million to fund new structured finance investments. Essex has a 50.0% ownership interest in the venture. In July 2025, Wesco VII originated a $42.6 million preferred equity investment for the development of a 480-unit apartment home community located in California. The investment has an initial preferred return of 13.5% and is expected to be fully funded by the fourth quarter of 2025.

Subsequent to quarter end, the Company sold the held for sale property noted above for a contract price of $97.5 million.

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

(3) Revenues

Disaggregated Revenue

The following table presents the Company’s revenues disaggregated by revenue source for the periods presented ($ in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Rental income	$	460,686	$	432,141	$	916,546	$	849,377
Other property	6,924		7,641		13,153		14,620
Management and other fees from affiliates	2,223		2,573		4,717		5,286
Total revenues	$	469,833	$	442,355	$	934,416	$	869,283

The following table presents the Company’s rental and other property revenues disaggregated by geographic operating segment for the periods presented ($ in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Southern California	$	189,744	$	179,488	$	378,366	$	348,378
Northern California	191,026		164,083		373,209		324,523
Seattle Metro	78,297		73,782		155,511		145,695
Other real estate assets (1)	8,543		22,429		22,613		45,401
Total rental and other property revenues	$	467,610	$	439,782	$	929,699	$	863,997

(1) Other real estate assets consist of revenues generated from retail space, commercial properties, held for sale properties, disposition properties and straight-line rent adjustments for concessions. Executive management does not evaluate such operating performance geographically.

The following table presents the Company’s rental and other property revenues disaggregated by current property category status for the periods presented ($ in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Same-property (1)	$	410,948	$	398,293	$	817,934	$	791,661
Acquisitions (2)	41,784		12,824		76,554		14,422


Non-residential/other, net (3)	14,711		29,176		35,432		58,488
Straight-line rent concessions (4)	167		(511)		(221)		(574)
Total rental and other property revenues	$	467,610	$	439,782	$	929,699	$	863,997

(1)Same-property includes properties that have comparable stabilized results as of January 1, 2024 and are consolidated by the Company for the six months ended June 30, 2025 and 2024. A community is considered to have reached stabilized operations once it achieves an initial occupancy of 90%.

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

(2)Acquisitions include properties acquired which did not have comparable stabilized results as of January 1, 2024.

(3)Non-residential/other, net consists of revenues generated from retail space, commercial properties, held for sale properties, disposition properties, student housing, properties undergoing significant construction activities that do not meet our redevelopment criteria, and two communities located in the California counties of Santa Barbara and Santa Cruz, which the Company does not consider its core markets.

(4)Represents straight-line concessions for residential operating communities. Same-property revenues reflect concessions on a cash basis. Total rental and other property revenues reflect concessions on a straight-line basis in accordance with U.S. GAAP.

Deferred Revenues and Remaining Performance Obligations

When cash payments are received or due in advance of the Company’s performance of contracts with customers, deferred revenue is recorded. The total deferred revenue balance related to such contracts was $0.3 million as of both June 30, 2025 and December 31, 2024, and was included in accounts payable and accrued liabilities within the accompanying condensed consolidated balance sheets. The amount of revenue recognized for the six months ended June 30, 2025 that was included in the December 31, 2024 deferred revenue balance was less than $0.1 million, which was included in rental and other property revenue within the condensed consolidated statements of income and comprehensive income.

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in the revenue recognition accounting standard. As of June 30, 2025, the Company had $0.3 million of remaining performance obligations. The Company expects to recognize approximately 22% of these remaining performance obligations in 2025 and the remaining 78% through 2027.

(4) Co-investments

The Company has joint ventures which are accounted for under the equity method. The co-investments’ accounting policies are similar to the Company’s accounting policies. The co-investments typically own, operate, and develop apartment communities. Additionally, the Company has invested in five unconsolidated technology co-investments and, as of June 30, 2025, the co-investment balance of these investments was $67.1 million, and the aggregate commitment was $86.0 million. As of December 31, 2024, the Company had five unconsolidated technology co-investments and the co-investment balance of these investments was $57.3 million and the aggregate commitment was $86.0 million.

The carrying values of the Company’s co-investments as of June 30, 2025 and December 31, 2024 were as follows ($ in thousands, except in parenthetical):


	Weighted Average Company Ownership Percentage (1)	June 30, 2025		December 31, 2024
Ownership interest in:
Wesco I, Wesco III, Wesco IV, Wesco V and Wesco VI (2)	54%	$	127,826	$	147,232
BEX IV and 500 Folsom	50%	141,712		146,142
Other (3)	53%	91,383		86,089
Total operating and other co-investments, net		360,921		379,463

Total preferred equity co-investments (includes related party investments of $50.4 million and $48.1 million as of June 30, 2025 and December 31, 2024, respectively. See Note 6, Related Party Transactions, for further discussion)		445,511		476,278
Total co-investments, net		$	806,432	$	855,741

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

(1)Weighted average company ownership percentages are as of June 30, 2025.

(2)As of June 30, 2025 and December 31, 2024, the Company’s investments in Wesco I, Wesco III, and Wesco IV were classified as a liability of $86.9 million and $77.2 million, respectively, due to distributions received in excess of the Company’s investment.

(3)As of June 30, 2025 and December 31, 2024, the Company’s investment in Expo was classified as a liability of $2.5 million and $2.0 million, respectively, due to distributions received in excess of the Company’s investment. The weighted average company ownership percentage excludes the Company’s investments in unconsolidated technology co-investments.

The combined summarized financial information of co-investments was as follows ($ in thousands):


	June 30, 2025		December 31, 2024
Combined balance sheets: (1)
Rental properties and real estate under development	$	3,870,839	$	4,094,826
Other assets	228,661		277,420
Total assets	$	4,099,500	$	4,372,246
Debt	$	2,826,999	$	3,001,303
Other liabilities	243,809		235,111
Equity	1,028,692		1,135,832
Total liabilities and equity	$	4,099,500	$	4,372,246


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Combined statements of income: (1)
Property revenues	$	84,569	$	99,706	$	170,875	$	204,928
Property operating expenses	(31,154)		(37,038)		(63,856)		(78,917)
Net operating income	53,415		62,668		107,019		126,011

Interest expense	(28,137)		(36,291)		(55,438)		(76,786)
General and administrative	(4,358)		(7,593)		(8,564)		(14,688)
Depreciation and amortization	(36,224)		(44,093)		(72,811)		(89,603)
Net loss	$	(15,304)	$	(25,309)	$	(29,794)	$	(55,066)
Company’s share of net income (2)	$	8,977	$	9,652	$	22,186	$	22,018

(1)Includes preferred equity investments held by the Company and excludes investments in unconsolidated technology co-investments.

(2)Includes the Company’s share of equity income from joint ventures and preferred equity investments, gain on sales of co-investments, co-investment promote income, and income from early redemption of preferred equity investments. Includes related party income of $1.3 million and $1.1 million for the three months ended June 30, 2025 and 2024, respectively, and $2.5 million and $2.2 million for the six months ended June 30, 2025 and 2024, respectively.

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

(5) Notes and Other Receivables

Notes and other receivables consisted of the following as of June 30, 2025 and December 31, 2024 ($ in thousands):


	June 30, 2025		December 31, 2024
Note receivable, secured, bearing interest at 9.00%, due October 2026 (Originated October 2021)	$	63,685	$	60,538
Note receivable, secured, bearing interest at 12.00%, due January 2025 (Originated August 2022)	—		3,167
Note receivable, secured, bearing interest at 11.25%, due October 2027 (Originated October 2022)	41,478		39,187
Receivable from preferred equity investment sponsor (1)	—		72,002
Other receivables from affiliates	5,882		5,646
Straight-line rent receivables (2)	8,886		9,235
Other receivables	18,705		17,460
Allowance for credit losses	(540)		(529)
Total notes and other receivables	$	138,096	$	206,706

(1)In the fourth quarter of 2024, the Company repaid a $72.0 million senior mortgage associated with a preferred equity investment in Artizan, a 241-unit stabilized apartment home community located in Oakland, CA, and subsequently issued a default notice to the third-party sponsor in January 2025, assumed full managerial control and consolidated the property. Refer to Note 2, Significant Transactions During the six months ended June 30, 2025, for additional details.

(2)These amounts are receivables from lease concessions recorded on a straight-line basis for the Company’s operating properties.

The following table presents the activity in the allowance for credit losses for notes receivable, secured for the periods presented ($ in thousands):


	Three Months Ended June 30,
	2025		2024

Balance at beginning of period	$	526	$	712
Provision for credit losses	14		28
Balance at end of period	$	540	$	740

	Six Months Ended June 30,
	2025		2024

Balance at beginning of period	$	529	$	687
Provision for credit losses	11		53
Balance at end of period	$	540	$	740

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

(6) Related Party Transactions

The Company charges certain fees relating to its co-investments for asset management, property management, development and redevelopment services. These fees from affiliates totaled $2.3 million and $2.8 million during the three months ended June 30, 2025 and 2024, respectively, and $4.8 million and $5.6 million for the six months ended June 30, 2025 and 2024, respectively. All of these fees are net of intercompany amounts eliminated by the Company. The Company netted development and redevelopment fees of less than $0.1 million for the three months ended June 30, 2025 and $0.2 million for three months ended June 30, 2024, and $0.1 million and $0.3 million for the six months ended June 30, 2025 and 2024, respectively, against general and administrative expenses .

The Company’s Chairman and founder, Mr. George M. Marcus, is the Chairman of the Marcus & Millichap Company (“MMC”), which is a parent company of a diversified group of real estate service, investment, and development firms. Mr. Marcus is also the Chairman of and owns a controlling interest in Marcus & Millichap, Inc. (“MMI”), a national brokerage firm listed on the New York Stock Exchange. For the three and six months ended June 30, 2025 and 2024, the Company did not pay brokerage commissions related to real estate transactions to MMI and its affiliates.

In April 2024, the Company funded a $53.6 million related party bridge loan to BEX II in connection with the payoff of a mortgage associated with one of BEX II’s properties located in Southern California. The note receivable accrued interest at SOFR plus 1.50% and was scheduled to mature in September 2024. In September 2024, the maturity date of the loan was extended to October 2024 and settled following the purchase of the BEX II portfolio in October 2024.

In August 2022, the Company funded an $11.2 million preferred equity investment in an entity whose sponsor includes an affiliate of MMC. The entity owns three multifamily communities located in Azusa, CA. The investment accrues interest based on a 9.5% preferred return and is scheduled to mature in August 2027.

In October 2018, the Company funded an $18.6 million preferred equity investment in an entity whose sponsor is an affiliate of MMC. The entity wholly owns a 268-unit apartment home community development located in Burlingame, CA. The investment initially accrued interest based on a 12.0% preferred return which was reduced to 9.0% upon completion and lease-up of the project. In April 2023, the investment’s maturity date was extended from April 2024 to May 2026 with the investment accruing interest based on an 11.0% preferred return. In April 2023, the Company received cash of $11.2 million for the partial redemption of this preferred equity investment.

In May 2018, the Company made a commitment to fund a $26.5 million preferred equity investment in an entity whose sponsors include an affiliate of MMC. The entity wholly owns a 400-unit apartment home community located in Ventura, CA. The investment accrued interest based on a 10.25% initial preferred return. The investment was scheduled to mature in May 2023. In November 2021, the Company received cash of $18.3 million for the partial redemption of this preferred equity investment resulting in a remaining total commitment of $13.0 million, and the maturity was extended to December 2028. As of June 30, 2025, $11.0 million of this commitment was funded and the Company accrues interest based on a 9.0% preferred return. The remaining unfunded commitment of $2.0 million expired in November 2024.

The Company has provided short-term loans to affiliates. As of June 30, 2025 and December 31, 2024, $5.9 million and $5.6 million, respectively, of short-term loans remained outstanding due from joint venture affiliates and is classified within notes and other receivables in the accompanying condensed consolidated balance sheets.

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

(7) Debt

Essex does not have indebtedness as debt is incurred by the Operating Partnership. Essex guarantees the Operating Partnership’s unsecured debt including the revolving credit facilities for the full term of the facilities.

Debt consisted of the following for the periods presented ($ in thousands):


	June 30, 2025			December 31, 2024			Weighted Average Maturity In Years as of June 30, 2025

Term loan - variable rate, net (1)	$	447,305		$	298,571		3.2
Bonds public offering - fixed rate, net (2)	5,072,617			5,175,217			7.4
Unsecured debt, net (3)	5,519,922			5,473,788
Lines of credit (4)	—			137,945
Commercial paper (5)	365,000			—
Mortgage notes payable, net (6)	874,532			989,884			6.4
Total debt, net	$	6,759,454		$	6,601,617
Weighted average interest rate on fixed rate unsecured bonds public offering	3.6		%	3.4		%
Weighted average interest rate on variable rate term loan	4.2		%	4.2		%
Weighted average interest rate on lines of credit	5.3		%	5.7		%
Weighted average interest rate on commercial paper	4.6		%	N/A
Weighted average interest rate on mortgage notes payable	4.2		%	4.2		%

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

(1)In May 2025, the Operating Partnership obtained a new $300.0 million unsecured term loan priced at SOFR plus 0.850% which is based on a tiered rate structure tied to the Company’s long-term unsecured credit rating with a one-year delayed draw feature. The Company may elect to increase this facility by up to an additional $300.0 million, to an aggregate size of $600.0 million, if the lenders permit. This term loan is scheduled to mature in May 2028, with two one-year extension options, exercisable at the option of the Company. As of June 30, 2025, the Company had drawn $150.0 million on the new term loan facility. In April 2025, the Company has entered into floating-to-fixed interest rate swaps to fix the interest rate for $150.0 million of the new term loan facility to an all-in rate of 4.1% through April 2030.

(2)In February 2025, the Operating Partnership issued $400.0 million of senior unsecured notes due on April 1, 2035 with a coupon rate of 5.375% per annum, which are payable on April 1 and October 1 of each year, beginning on October 1, 2025. The 2035 Notes were offered to investors at a price of 99.604% of the principal amount. In April 2025, the Company used these proceeds to repay its $500.0 million senior unsecured notes at maturity.

(3)Unsecured debt, net, consists of fixed rate public bond offerings and a variable rate term loan which includes unamortized discounts, net of premiums of $1.0 million and unamortized premiums, net of discounts of $0.1 million, and unamortized debt issuance costs of $29.1 million and $26.3 million, as of June 30, 2025 and December 31, 2024, respectively.

(4)Lines of credit, related to the Company’s two lines of unsecured credit aggregating $1.28 billion as of both June 30, 2025, and December 31, 2024, excludes unamortized debt issuance costs of $5.3 million and $6.2 million as of June 30, 2025 and December 31, 2024, respectively. These debt issuance costs are included in prepaid expenses and other assets in the condensed consolidated balance sheets. As of June 30, 2025, the Company’s $1.2 billion credit facility had an interest rate at the Adjusted Secured Overnight Financing Rate (“Adjusted SOFR”) plus 0.765%, which is based on a tiered rate structure tied to the Company’s credit ratings, adjusted for the facility’s sustainability metric adjustment feature, and a scheduled maturity date of January 2029 with two six-month extensions, exercisable at the Company’s option. In July 2025, the Company amended this revolving credit facility increasing the borrowing capacity to $1.5 billion and extended its maturity to January 2030 with two 6-month extension options, exercisable at the Company's option. The Company may elect to increase the facility by up to an additional $1.0 billion, to an aggregate size of $2.5 billion, if the lenders permit. The underlying interest rate on this new line of credit facility is SOFR plus 0.775% which is based on a tiered rate structure tied to the Company's long-term unsecured credit ratings. As of June 30, 2025, the Company’s $75.0 million working capital unsecured line of credit had an interest rate of the Adjusted SOFR plus 0.765%, which is based on a tiered rate structure tied to the Company’s credit ratings and a scheduled maturity date of July 2026.

(5)In May 2025, the Company entered into a commercial paper program under which it can issue unsecured short-term notes, which are backstopped by, and reduce the borrowing capacity of, the Company’s unsecured line of credit facilities. The Company can issue up to $750.0 million of commercial paper for up to 397 days from the date of issue. The commercial paper balance excludes unamortized debt issuance of $0.1 million as of June 30, 2025, and are included in prepaid expenses and other assets in the condensed consolidated balance sheets.

(6)Includes total unamortized discounts, net of premiums of approximately $0.4 million and $0.2 million, reduced by unamortized debt issuance costs of $2.3 million and $2.6 million, as of June 30, 2025 and December 31, 2024, respectively.

The aggregate scheduled principal payments of the Company’s outstanding debt, excluding lines of credit and commercial paper, as of June 30, 2025 were as follows ($ in thousands):


2025	$	98,110
2026	644,405
2027	734,397
2028	518,332
2029	501,456
Thereafter	3,930,481
Total	$	6,427,181

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

(8) Segment Information

The Company’s segment disclosures present the measure used by the chief operating decision maker (“CODM”) for purposes of assessing each segment’s performance. The Company’s CODM is a group comprised of its Chief Executive Officer, Chief Financial Officer, Chief Administrative Officer, and Chief Investment Officer, who use net operating income (“NOI”) to assess the performance of the business for the Company’s reportable operating segments. NOI represents total property revenues less direct property operating expenses.

The CODM evaluates the Company’s operating performance geographically. The Company defines its reportable operating segments as the three geographical regions in which its communities are located: Southern California, Northern California and Seattle Metro.

Excluded from segment revenues and NOI are management and other fees from affiliates and interest and other income (loss). Other real estate assets revenues, property operating expenses, including real estate taxes, and NOI included in the following schedule also consist of revenues generated from retail space, commercial properties, held for sale properties, disposition properties and straight-line adjustments for concessions. Executive management does not evaluate such operating performance geographically. Other non-segment assets include items such as real estate under development, co-investments, real estate held for sale, cash and cash equivalents, marketable securities, notes and other receivables, and prepaid expenses and other assets.

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

The revenues and NOI for each of the reportable operating segments are summarized as follows for the three and six months ended June 30, 2025 and 2024 ($ in thousands):


	Three Months Ended June 30,
	2025						2024
	Rental and other property revenue		Property operating expenses, including real estate taxes		Net operating income		Rental and other property revenue		Property operating expenses, including real estate taxes		Net operating income
Southern California	$	189,744	$	54,964	$	134,780	$	179,488	$	51,411	$	128,077
Northern California	191,026		58,828		132,198		164,083		47,702		116,381
Seattle Metro	78,297		20,456		57,841		73,782		21,895		51,887
Other real estate assets	8,543		1,181		7,362		22,429		5,526		16,903
Total	$	467,610	$	135,429	$	332,181	$	439,782	$	126,534	$	313,248

Total net operating income					332,181						313,248
Management and other fees from affiliates					2,223						2,573
Corporate-level property management expenses					(12,220)						(11,622)
Depreciation and amortization					(151,501)						(145,613)
General and administrative					(17,157)						(21,136)


Gain on sale of real estate and land					126,174						—
Interest expense					(65,262)						(59,120)
Total return swap income					1,071						629
Interest and other income					6,808						9,568
Equity income from co-investments					8,977						9,652
Tax benefit on unconsolidated technology co-investments					232						807


Net income					$	231,526					$	98,986

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)


	Six Months Ended June 30,
	2025						2024
	Rental and other property revenue		Property operating expenses, including real estate taxes		Net operating income		Rental and other property revenue		Property operating expenses, including real estate taxes		Net operating income
Southern California	$	378,366	$	109,594	$	268,772	$	348,378	$	101,143	$	247,235
Northern California	373,209		115,592		257,617		324,523		97,969		226,554
Seattle Metro	155,511		44,358		111,153		145,695		43,022		102,673
Other real estate assets	22,613		4,506		18,107		45,401		10,898		34,503
Total	$	929,699	$	274,050	$	655,649	$	863,997	$	253,032	$	610,965

Total net operating income					655,649						610,965
Management and other fees from affiliates					4,717						5,286
Corporate-level property management expenses					(24,552)						(22,721)
Depreciation and amortization					(302,788)						(285,346)
General and administrative					(33,449)						(38,307)
Expensed acquisition and investment related costs					—						(68)

Gain on sale of real estate and land					237,204						—
Interest expense					(127,994)						(115,053)
Total return swap income					2,271						1,425
Interest and other income					11,097						66,843
Equity income from co-investments					22,186						22,018
Tax benefit on unconsolidated technology co-investments					395						758
Loss on early retirement of debt					(762)						—
Gain on remeasurement of co-investment					330						138,326
Net income					$	444,304					$	384,126

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)

Total assets for each of the reportable operating segments are summarized as follows as of June 30, 2025 and December 31, 2024 ($ in thousands):


	June 30, 2025		December 31, 2024
Assets:
Southern California	$	4,094,046	$	4,162,462
Northern California	6,015,104		5,452,235
Seattle Metro	1,437,049		1,460,865
Other real estate assets (1)	163,405		363,338
Net reportable operating segments - real estate assets	11,709,604		11,438,900
Real estate under development	105,591		52,682
Co-investments	895,821		935,014
Real estate held for sale	47,653		—
Cash and cash equivalents, including restricted cash	67,884		75,846
Marketable securities	82,162		69,794
Notes and other receivables	138,096		206,706
Operating lease right-of-use assets	52,519		51,556
Prepaid expenses and other assets	82,160		96,861
Total assets	$	13,181,490	$	12,927,359

(1)Includes retail space, commercial properties, held for sale properties, and disposition properties.

(9) Net Income Per Common Share and Net Income Per Common Unit

Essex Property Trust, Inc.

Basic and diluted income per share was calculated as follows for the periods presented ($ in thousands, except per share amounts):


	Three Months Ended June 30,
	2025					2024
	Income		Weighted- average Common Shares	Per Common Share Amount		Income		Weighted- average Common Shares	Per Common Share Amount
Basic:
Net income available to common stockholders	$	221,362	64,385,988	$	3.44	$	92,914	64,209,878	$	1.45
Effect of Dilutive Securities:
Stock options	—		21,625			—		17,773


Diluted:
Net income available to common stockholders	$	221,362	64,407,613	$	3.44	$	92,914	64,227,651	$	1.45

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

June 30, 2025 and 2024

(Unaudited)


	Six Months Ended June 30,
	2025					2024
	Income		Weighted- average Common Shares	Per Common Share Amount		Income		Weighted- average Common Shares	Per Common Share Amount
Basic:
Net income available to common stockholders	$	424,472	64,350,640	$	6.60	$	365,645	64,207,482	$	5.69
Effect of Dilutive Securities:
Stock options	—		28,313			—		11,429


Diluted:
Net income available to common stockholders	$	424,472	64,378,953	$	6.59	$	365,645	64,218,911	$	5.69

The table above excludes from the calculations of diluted earnings per share weighted average convertible OP Units of 2,263,171 and 2,258,812, which include vested 2014 Long-Term Incentive Plan Units and 2015 Long-Term Incentive Plan Units, for the three months ended June 30, 2025 and 2024, respectively, and 2,284,941 and 2,258,812 for the six months ended June 30, 2025 and 2024, respectively, because they were anti-dilutive. The related income allocated to these convertible OP Units aggregated $7.8 million and $3.3 million for the three months ended June 30, 2025 and 2024, respectively, and $15.1 million and $12.9 million for the six months ended June 30, 2025 and 2024, respectively.

Stock options of 250,512 and 326,199 for the three months ended June 30, 2025 and 2024, respectively, and 234,727 and 396,519 for the six months ended June 30, 2025 and 2024, respectively, were excluded from the calculation of diluted earnings per share because the assumed proceeds per share of such options plus the average unearned compensation were greater than the average market price of the common stock for the periods ended and, therefore, were anti-dilutive.

Essex Portfolio, L.P.

Basic and diluted income per unit was calculated as follows for the periods presented ($ in thousands, except per unit amounts):


	Three Months Ended June 30,
	2025					2024
	Income		Weighted- average Common Units	Per Common Unit Amount		Income		Weighted- average Common Units	Per Common Unit Amount
Basic:
Net income available to common unitholders	$	229,143	66,649,159	$	3.44	$	96,184	66,468,691	$	1.45
Effect of Dilutive Securities:
Stock options	—		21,625			—		17,773


Diluted:
Net income available to common unitholders

ESSEX PROPERTY TRUST, INC. 10-Q