Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

The shares of the Company’s common stock are traded on the New York Stock Exchange (“NYSE”) under the symbol ESS. ESS common stock has been traded on the NYSE since June 13, 1994. The high, low and closing price per share of common stock reported on the NYSE for the quarters indicated are as follows:

The closing price of ESS stock as of February 21, 2017 was $230.97.

There is no established public trading market for Essex Portfolio, L.P.’s OP Units.

Holders

The approximate number of holders of record of the shares of ESS common stock was 1,336 as of February 21, 2017. This number does not include stockholders whose shares are held in investment accounts by other entities. ESS believes the actual number of stockholders is greater than the number of holders of record.

As of February 21, 2017, there were 184 holders of record of Essex Portfolio, L.P.’s OP Units, including ESS.

Return of Capital

Under provisions of the Internal Revenue Code of 1986, as amended, the portion of the cash dividend, if any, that exceeds earnings and profits is considered a return of capital. The return of capital is generated due to a variety of factors, including the deduction of non-cash expenses, primarily depreciation, in the determination of earnings and profits.

The status of the cash dividends distributed for the years ended December 31, 2016, 2015, and 2014 related to common stock, and Series H preferred stock for tax purposes are as follows:

Dividends and Distributions

Since ESS’s initial public offering on June 13, 1994, ESS and the Operating Partnership have paid regular quarterly dividends/distributions to its stockholders and unitholders. ESS paid the following dividends per share of common stock and the Operating Partnership paid the following distributions per limited partner OP unit:

Future dividends/distributions by ESS and the Operating Partnership will be at the discretion of the Board of Directors of ESS and will depend on the actual cash flows from operations of the Company, its financial condition, capital requirements, the annual distribution requirements under the REIT provisions of the Internal Revenue Code, applicable legal restrictions and such other factors as the Board of Directors deem relevant. There are currently no contractual restrictions on ESS and the Operating Partnership present or future ability to pay dividends and distributions.

The Board of Directors has declared a dividend/distribution for the fourth quarter of 2016 of $1.60 per share. The dividend/distribution was paid on January 17, 2017 to shareholders/unitholders of record as of December 30, 2016.

Dividend Reinvestment and Share Purchase Plan

ESS has adopted a dividend reinvestment and share purchase plan designed to provide holders of common stock with a convenient and economical means to reinvest all or a portion of their cash dividends in shares of common stock and to acquire additional shares of common stock through voluntary purchases. Computershare, LLC, which serves as ESS transfer agent, administers the dividend reinvestment and share purchase plan. For a copy of the plan, contact Computershare, LLC at (312) 360-5354.

Securities Authorized for Issuance under Equity Compensation Plans

See the Company’s disclosure in the 2017 Proxy Statement under the heading “Equity Compensation Plan Information”, which disclosure is incorporated herein by reference.

Issuance of Registered Equity Securities

During 2016, ESS did not make any common stock sales pursuant to its registration statement. Additionally, during the first quarter of 2017 through February 21, 2017, ESS has not issued any shares of common stock.

Issuer Purchases of Equity Securities

In December 2015, ESS Board of Directors authorized a stock repurchase plan to allow ESS to acquire shares in an aggregate of up to $250 million. Under the program, in October 2016, the Company repurchased and retired 5,100 shares totaling $1.0 million, including commissions, at an average stock price of $204.92 per share. There have been no other repurchases since the inception of this plan. The Company has $249 million of purchase authority remaining under the plan.

Performance Graph

The line graph below compares the cumulative total stockholder return on ESS common stock for the last five years with the cumulative total return on the S&P 500 and the NAREIT All Equity REIT index over the same period. This comparison assumes that the value of the investment in the common stock and each index was $100 on December 31, 2011 and that all dividends were reinvested (1).

The graph and other information furnished under the above caption “Performance Graph” in this Part II Item 5 of this Form 10-K shall not deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C, or to the liabilities of the Exchange Act, as amended.

Unregistered Sales of Equity Securities

During the years ended December 31, 2016 and 2015, the Operating Partnership issued partnership units in private placements in reliance on the exemption from registration provided by Section 4(2) of the Securities Act, in the amounts and for the consideration set forth below:

During the years ended December 31, 2016 and 2015, ESS issued an aggregate of 137,622 and 203,556 shares of its common stock upon the exercise of stock options, respectively. ESS contributed the proceeds from the option exercises of $18.9 million and $26.5 million to our Operating Partnership in exchange for an aggregate of 137,622 and 203,556 common OP Units, as required by the Operating Partnership’s partnership agreement, during the years ended December 31, 2016 and 2015, respectively.

During the years ended December 31, 2016 and 2015, ESS issued an aggregate of 2,018 and 3,338 shares of its common stock in connection with restricted stock awards for no cash consideration, respectively. For each share of common stock issued by ESS in connection with such awards, our Operating Partnership issued common OP units to ESS as required by the partnership agreement, for an aggregate of 2,018 and 3,338 units during the years ended December 31, 2016 and 2015, respectively.

During the years ended December 31, 2016 and 2015, ESS issued an aggregate of 14,094 and 6,450 shares of its common stock in connection with the exchange of Operating Partnership limited partnership units and DownREIT limited partnership units by limited partners into shares of common stock. For each share of common stock issued by ESS in connection with such exchange, our Operating Partnership issued common OP units to ESS as required by the partnership agreement, for an aggregate of 14,094 and 6,450 units during the year ended December 31, 2016 and 2015, respectively.

During the year ended December 31, 2016, there were no shares of ESS's common stock issued or sold pursuant to its equity distribution program. During the year ended December 31, 2015, ESS issued and sold an aggregate of 1,481,737 shares of its common stock, respectively, pursuant to a registration statement and its equity distribution program. ESS contributed the net proceeds from these share issuances of $332.3 million in exchange for an aggregate of 1,481,737 common OP Units, respectively, as required by the Operating Partnership's partnership agreement.