Essex Property Trust (ESS) 10-K risk factor changes: FY2021 vs FY2020

If the communities and other real estate [removed: investments] [added: investments, including development and redevelopment properties,] do not generate sufficient income to meet operating expenses, including debt service and capital expenditures, cash flow and the ability to make distributions to Essex's stockholders or the Operating Partnership's unitholders will be adversely affected.

Income from the communities may be further adversely affected by, among other things, the following [removed: factors:][added: factors, in addition to the other risk factors listed in this Item 1A:]

- changes in the general or local economic climate, including layoffs, plant closings, industry slowdowns, relocations of significant local [removed: employers] [added: employers, changing demographics, increased worker locational flexibility from teleconferencing] and [added: video-conferencing technology, and] other events negatively impacting local employment [removed: rates and wages and the local economy;][added: rates.]

- adverse [removed: economic] [added: economic, regulatory,] or market conditions due to the COVID-19 pandemic leading to [added: (1)] a temporary or permanent move by tenants and/or prospective tenants from locations in which our communities are [removed: located;][added: located, (2) increased costs or government limitations on revenue, and/or (3) delinquency due to various eviction moratoria;]

- the [removed: attractiveness] [added: appeal] and desirability of our communities to tenants, including, without limitation, the size and amenity offerings of our [removed: units,] [added: apartment homes, the safety and convenience of their locations,] our technology offerings and our ability to identify and cost effectively implement new, relevant [removed: technologies, and to keep up with constantly changing consumer demand for the latest innovations, including any increased requirements due to the significant increase in the number of people who continue to “work from home”;][added: technologies,.]

- inflationary environments in which the costs to operate and maintain communities increase at a rate greater than our ability to increase rents, or deflationary environments where we may be exposed to declining rents more quickly under our short-term leases; [added: and]

Short-term leases expose us to the effects of declining market rents, and the Company may be unable to renew leases or relet units as leases expire. [removed: Substantially all of our apartment] [added: If the Company is unable to promptly renew the in place short-term] leases [added: or relet the units, or if the rental rates upon renewal or reletting] are [removed: for a term] [added: significantly lower than expected rates, then the Company’s results] of [removed: one year or less.][added: operations and financial condition will be adversely affected.]

With these [removed: short term] [added: short-term] leases, our rental revenues are impacted by declines in market rents more quickly than if our leases were for longer terms.

National and regional economic environments can negatively impact the Company’s liquidity and operating results. The [removed: Company's] [added: Company’s] forecast for the national economy assumes growth of the [removed: gross domestic product] [added: GDP] of the national economy and the economies of the west coast states.

In the event of a recession or other negative economic [removed: effects, including as a result of the COVID-19 pandemic,] [added: effects] the Company could incur reductions in rental [removed: rates,] [added: and] occupancy [removed: levels,] [added: rates,] property valuations and increases in operating costs such as advertising and turnover expenses.

Any such recession or similar event may affect consumer confidence and spending and negatively impact the volume and pricing of real estate transactions, which could negatively affect [added: the Company’s liquidity and its ability to vary its portfolio promptly in response to changes to the economy.]

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Rent control, or other changes in applicable laws, or noncompliance with applicable laws, could adversely affect the Company's [removed: operations] [added: operations, property values] or expose us to liability. The Company must own, operate, manage, acquire, develop and redevelop its properties in compliance with numerous federal, state and local laws and regulations, some of which may conflict with one another or be subject to limited judicial or regulatory interpretations.

These laws and regulations may include zoning laws, building codes, rent control or stabilization laws, [added: governmental emergency orders,] laws benefiting disabled persons, [added: including, without limitation, the Americans with Disabilities Act of 1990,] federal, state and local tax laws, landlord tenant laws, environmental laws, employment laws, immigration laws and other laws regulating [removed: housing] [added: housing, including, without limitation, the Fair Housing Amendment Act of 1988,] or that are generally applicable to the Company's business and operations.

Changes in, or noncompliance with, these regulatory requirements could require the Company to make significant unanticipated expenditures to address [removed: noncompliance, which could have a material adverse effect on the Company's financial condition, results of operations or cash flows.][added: noncompliance.]

[removed: In addition, rent] [added: Rent] control or rent stabilization [added: laws, and new such] laws [added: that may be implemented,] and other regulatory restrictions may limit our ability to increase rents and pass through new or increased operating costs to our tenants.

[removed: Considerable uncertainty still surrounds COVID-19, including when] [added: The COVID-19 pandemic, or] the [removed: pandemic will conclude, how quickly vaccines can be safely] [added: future outbreak of other highly contagious diseases, could materially affect our business, financial condition] and [removed: widely distributed, the effectiveness] [added: results] of [removed: such vaccines,] [added: operations. Uncertainty still surrounds COVID-19,] and the potential short-term and long-term effects, including but not limited to shifts in consumer housing demand based on geography, affordability, housing type [removed: (e.g. multi-family vs. single-family)] and unit [removed: type (e.g. studio vs. multi-bedroom),] [added: type,] mainly resulting from the paradigm shift of work culture, [removed: the decentralization of corporate headquarters] [added: as well as economic uncertainty, volatility] and [removed: the success of “work from home” models.][added: increased regulation.]

In some cases, we [added: are subject to eviction moratoria or] may be legally required to or otherwise agree to restructure tenants’ rent [removed: obligations,] [added: obligations] and may not be able to do so on terms as favorable to us as those currently in place.

[added: Furthermore, various city, county and state laws restricting rent increases in times of emergency] have come into effect in connection with the COVID-19 pandemic, and numerous state, local, federal and industry-initiated efforts have and may continue to affect our ability to collect rent or enforce remedies for the failure to pay rent, including, among others, limitations or prohibitions on evicting tenants unwilling or unable to pay rent and prohibitions on the ability to collect unpaid rent during certain timeframes.

In the event of tenant nonpayment, default or bankruptcy, we may incur costs in protecting our investment and re-leasing our [removed: property,] [added: property] and have limited ability to renew existing leases or sign new leases at projected rents.

Our properties may also incur significant costs or losses related to legislative [removed: mandates, including shelter-in-place orders, business shut-downs, quarantines, infection or other related factors,] [added: mandates] which may result in a negative impact on our occupancy levels.

Some businesses [removed: have been ordered to temporarily shut down, such as indoor dining, and] many have permanently closed due to deteriorating economic conditions, which has contributed to the [removed: shuttering of some commercial spaces in downtown areas, and the] temporary, or possibly permanent, deterioration of neighborhoods in and around some of our urban communities, which may be further worsened by increases in homelessness and [removed: crime as a result of the effects of the pandemic on some individuals and communities.][added: crime.]

[removed: Additionally, market] [added: Market] fluctuations as a result of the COVID-19 pandemic may affect our ability to obtain necessary funds for our [removed: operations from current lenders] [added: operations, acquisitions,] or [removed: new borrowings.][added: re-financings.]

Also, in connection with such acquisitions, we may assume unknown [added: or contingent] liabilities, which could ultimately lead to material costs for us that we did not expect to [removed: incur.][added: incur and for which the Company may have no recourse, or only limited recourse, against the sellers due to limited and no indemnification requirements for a breach of representations and warranties.]

The Company expects to finance future [removed: acquisitions, in whole or in part,] [added: acquisitions] under various forms of secured or unsecured financing or through the issuance of partnership units by the Operating Partnership or related partnerships [removed: or joint ventures or additional equity by the Company.]

The use of equity [removed: financing, rather than debt,] [added: financing] for future developments or acquisitions could dilute the interest of the Company’s existing stockholders.

Development and redevelopment activities may be delayed, not completed, and/or not achieve expected results. The Company pursues development and redevelopment [removed: projects and these projects generally require various governmental and other approvals, which have no assurance of being received and/or the timing of which may be delayed from the Company’s expectations.][added: projects.]

As of December 31, [removed: 2020,] [added: 2021,] the Company had [removed: three] [added: one] consolidated development [removed: projects] [added: project] and [removed: three] [added: one] unconsolidated joint venture development [removed: projects] [added: project] comprised of [removed: 1,853] [added: 371] apartment homes for an estimated cost of [removed: $1.1 billion,] [added: $217.0 million,] of which [removed: $174.0] [added: $61.0] million remains to be expended, and [removed: $118.0] [added: $32.6] million is the Company's share.

The geographic concentration of the Company’s communities and fluctuations in local markets may adversely impact the Company’s financial condition and operating results. The Company generated significant amounts of rental revenues for the year ended December 31, [removed: 2020,] [added: 2021,] from the Company’s communities concentrated in Southern California (primarily Los Angeles, Orange, [removed: Santa Barbara,] San Diego, and Ventura counties), Northern California (the San Francisco Bay Area), and the Seattle metropolitan area.

For the year ended December 31, [removed: 2020, 81%] [added: 2021, 83%] of the Company’s rental revenues were generated from communities located in California.

Because the Company’s communities are [removed: primarily located in Southern California, Northern California and the Seattle metropolitan area,] [added: geographically concentrated,] the Company is exposed to greater economic concentration risks than if it owned a more geographically diverse portfolio.

[removed: Recently,] California has also experienced increased relocation out of the [removed: state, including as a result of the regulatory landscape and the COVID-19 pandemic.][added: state.]

Our real estate taxes in Washington could increase as a result of property value reassessments or [removed: increased property tax rates in that state.]

A [removed: current] California law commonly referred to as Proposition 13 generally limits annual real estate tax increases on California properties to 2% of assessed value.

In addition, from time to time voters and lawmakers have announced initiatives to repeal or amend Proposition 13 to eliminate its application to commercial and industrial [removed: property] [added: property, increase the permitted annual real estate tax increases,] and/or introduce split tax roll legislation.

[added: Increases in the] Company’s expenses to own and maintain its properties could adversely impact the Company’s financial condition and results of operations.

Competitive housing in a particular area and fluctuations in cost of owner-occupied single- and multifamily homes caused by a decrease in housing prices, mortgage interest rates and/or government programs to promote home ownership or create additional rental and/or other types of housing, or an increase in desire for more space due to work from home needs or increased time spent at [removed: home due to COVID-19,] [added: home,] could adversely affect the Company’s ability to retain its tenants, lease apartment homes and increase or maintain rents.

Investments in mortgages, mezzanine loans, subordinated debt, other real estate, and other marketable securities could adversely affect the Company’s cash flow from [removed: operations. The Company may purchase or otherwise invest in securities issued by entities which own real estate and/or invest in mortgages or unsecured debt obligations.][added: operations.]

The Company’s ownership of co-investments, including joint ventures and joint ownership of communities, its ownership of properties with shared facilities with a homeowners' association or other entity, its ownership of properties subject to a ground lease and its preferred equity investments and its other partial interests in entities that own communities, could limit the Company’s ability to control such communities and may restrict our ability to finance, sell or otherwise transfer our interests in these properties and expose us to loss of the properties if such agreements are breached by us or terminated. [added: The Company has entered into, and may continue in the future to enter into, certain co-investments, including joint ventures or partnerships through which it owns an indirect economic interest in less than 100% of the community or land or other investments owned directly by the joint venture or partnership.]

As of December 31, [removed: 2020,] [added: 2021,] the Company had, through several joint ventures, an interest in [removed: 8,652] [added: 10,257] apartment homes in stabilized operating communities for a total book value of [removed: $358.3] [added: $565.3] million.

wages and the local economy;

Noncompliance with laws could expose the Company to liability, including fines to government authorities or damage awards to private litigants, reduced income or increased costs in order to comply with such requirements.

These

requirements may change, or new requirements may be imposed.

In addition, macro-economic factors have caused some worker shortages and construction delays which could increase costs and lower profitability.

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or joint ventures or additional equity by the Company.

Factors that may adversely affect local market and economic conditions include regional specific acts of nature (e.g., earthquakes, fires, floods, etc.) and those other factors listed in the risk factor titled “*General real estate investment risks may adversely affect property income and values*” and elsewhere in this Item 1A.

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increased property tax rates in that state.

The Company may purchase or otherwise invest in securities issued by entities which own real estate and/or invest in mortgages or unsecured debt obligations.

In general, investing in mortgages may pose some risk, including but not limited to the value of mortgaged property may be less than the amounts owed, causing realized or unrealized losses; the borrower may not pay indebtedness under the mortgage when due, requiring the Company to foreclose, and the amount recovered in connection with the foreclosure may be less than the amount owed; that interest rates payable on the mortgages may be lower than the Company’s cost of funds; in the case of junior mortgages, that foreclosure of a senior mortgage could eliminate the junior mortgage; delays in the collection of principal and interest if a borrower claims bankruptcy; possible senior lender default or overconcentration of senior lenders in portfolio; and unanticipated early prepayments may limit the Company’s expected return on its investment.

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years that certain molds may in some instances lead to adverse health effects, including allergic or other reactions.

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may also be subject to significant liability claims.

Additionally, ongoing political volatility may increase the likelihood of significant changes in laws, such as repeal of Proposition 13, that could affect the Company's overall strategy.

These risks include but are not limited to an inability to evaluate accurately local apartment market conditions and local economies; an inability to identify appropriate acquisition opportunities or to obtain land for development; an inability to hire and retain key personnel; and lack of familiarity with local governmental and permitting procedures.

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Such potential other consequences include, without limitation, that the Company may be exposed to a risk of litigation, including, without limitation, government enforcement actions, private

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The Company is subject to the risks normally associated with debt financing, including, but not limited to cash flow may not be sufficient to meet required payments of principal and interest and the REIT distribution requirements of the Code; inability to renew, repay, or refinance maturing indebtedness on encumbered apartment communities on favorable terms or at all, possibly requiring the Company to sell a property or properties on disadvantageous terms; inability to comply with debt covenants could trigger cash management provisions limiting our ability to control cash flows, cause defaults, or an acceleration of maturity dates; and paying debt before the scheduled maturity date could result in prepayment penalties.

Any of these risks might result in losses that could have an adverse effect on the Company and its ability to make distributions to

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Additionally, the Company must continue to recruit and train qualified operational staff at its properties.

While the Company offers competitive pay and benefits, it may be difficult to appropriately staff our properties in a highly competitive job market.

He is the Chairman of the Marcus & Millichap Company ("MMC"), which is a parent company of

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In addition, the trading price of

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If the provisions of the Bylaws are amended or eliminated, the control share provisions of the Maryland General Corporation Law could delay, defer or

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Those provisions include, among others, directors may be removed by stockholders, without cause, only upon the affirmative vote of at least two-thirds of the votes entitled to be cast generally in the election of the directors, and with cause, only upon the affirmative vote of a majority of the votes entitled to be cast generally in the election of the directors; Essex’s Board of Directors can fix the number of directors and fill vacant directorships upon the vote of a majority of the directors and Essex's Board of Directors can classify the board such that the entire board is not up for re-election annually; stockholders must give advance notice to nominate directors or propose business for consideration at a stockholders’ meeting; and for stockholders to call a special meeting, the meeting must be requested by not less than a majority of all the votes entitled to be cast at the meeting.

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affect its REIT qualification, it cannot provide assurances that it will successfully achieve that result.

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required to pay additional taxes, interest, and penalties as a result of an audit adjustment.

- competition from other available housing alternatives;

- changes in rent control or stabilization laws or other laws regulating housing and other increasing regulations on people and businesses in locations where our communicates are located;

- the Company’s ability to provide for adequate maintenance and insurance;

- declines in the financial condition of our tenants, which may make it more difficult for us to collect rents from some tenants;

- any decline in or tenants' perceptions of the safety, convenience and attractiveness of our communities and the neighborhoods where they are located; and

- changes in interest rates and availability of financing.

As leases at the communities expire, tenants may enter into new leases on terms that are less favorable to the Company.

Income and real estate values also may be adversely affected by such factors as applicable laws, including, without limitation, the Americans with Disabilities Act of 1990 (the "Disabilities Act"), Fair Housing Amendment Act of 1988 (the "FHAA"), permanent and temporary rent control laws, rent stabilization laws, other laws regulating housing that may prevent the Company from raising rents to offset increased operating expenses, and tax laws.

If the Company is unable to promptly renew the leases or relet the units, or if the rental rates upon renewal or reletting are significantly lower than expected rates, then the Company’s results of operations and financial condition will be adversely affected.

the Company’s liquidity and its ability to vary its portfolio promptly in response to changes to the economy.

Noncompliance with laws could expose the Company to liability.

If the Company does not comply with any or all of these requirements, it may have to pay fines to government authorities or damage awards to private litigants, and/or may have to decrease rents in order to comply with such requirements.

The Company does not know whether these requirements will change or whether new requirements will be imposed.

There has been a recent increase in municipalities, including those in which we own properties, considering or being urged by advocacy groups to consider rent control or rent stabilization laws and regulations or take other actions which could limit our ability to raise rents based solely on market conditions.

The current COVID-19 pandemic, or the future outbreak of other highly infectious or contagious diseases, and the timing and effectiveness of vaccine distribution, could materially and adversely affect our business, financial condition and results of operations. The outbreak of COVID-19, which is present in nearly all regions around the world, including the United States and the specific regions in which our apartment communities are located, has created considerable instability and disruption in the U.S. and world economies.

Moreover, local, state and national measures taken to limit the spread of COVID-19, including “social distancing” and other restrictions on travel, congregation and business operations have already resulted in significant negative economic impacts.

The prolonged impact of COVID-19 on the U.S. and world economies remains uncertain, but has resulted in increased health issues and mortality rates, increased unemployment, and a world-wide economic downturn, the duration and scope of which cannot currently be predicted.

The extent to which the Company’s financial condition or operating results will continue to be affected by the COVID-19 pandemic will largely depend on future demand and developments, which are highly uncertain and cannot be accurately predicted.

The Company’s operating results depend, in large part, on revenues derived from leasing space in our apartment communities to residential tenants and the ability of tenants to generate sufficient income to pay their rents in a timely manner.

The market and economic challenges created by the COVID-19 pandemic, and measures implemented to prevent its spread, have, and may continue to, adversely affect our returns and profitability.

The spread of COVID-19 has resulted in increases in unemployment and mass layoffs, and some tenants have experienced deteriorating financial conditions and are unwilling or unable to pay all or part of their rent on a timely basis, or at all, and, the continued spread of COVID-19 as well as a sustained economic downturn may result in further increases or sustainment of these situations.

Furthermore, various city, county and state laws restricting rent increases in times of emergency

Additionally, eviction moratoriums have passed in various formats at every level of government and while the Company strives to comply, given some of the conflicting standards and unclear requirements, strict compliance might be difficult.

Some residents’ views about their obligations to pay rent, even when financially capable of meeting their rent obligation, have shifted away from viewing rent as a primary and necessary financial obligation, and this shift may continue or worsen as a result of the eviction moratoriums and the various laws affecting our abilities to collect rent.

Moreover, we typically conduct aspects of our leasing activity on-site at our apartment communities.

Reductions in the ability and willingness of prospective residents to visit our communities due to the COVID-19 pandemic could reduce rental revenue and ancillary operating revenue produced by our properties.

Additionally, in connection with an outbreak that directly impacts one or more of our corporate offices or apartment communities, we may experience negative publicity and/or an unwillingness of prospective residents to visit or ultimately choose to live in our communities, which could directly affect our rental revenue.

In addition, we have incurred costs associated with protecting our employees and residents, including the purchase of personal protective equipment and disinfecting our properties, and those costs may continue to increase.

To the extent our management or personnel are impacted in significant numbers by the COVID-19 pandemic and are not available or allowed to conduct work, our business and operating results may be negatively impacted.

Additionally, our corporate offices remain closed as we have instituted “work from home” measures for our corporate associates, which may impact productivity and our employees’ overall mental health.

We may be unable to obtain financing for the acquisition of investments or re-financing for existing assets on satisfactory terms, or at all.

In addition, moratoriums on construction and macro-economic factors have caused some construction delays and may cause construction contractors to be unable to perform and governmental inspections and approvals to be delayed or postponed, which may cause the delivery date of certain development projects or investments in third-party development projects to be materially extended.

The global impact of the COVID-19 pandemic continues to evolve rapidly, and the extent of its effect on our operational and financial performance will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration, scope and severity of the pandemic, the actions taken to contain or mitigate its impact, the timing of distribution and effectiveness of vaccines and the willingness and ability of the public to get vaccinated in a timely manner, and the direct and indirect economic effects of the pandemic and related containment measures, among others.

However, the COVID-19 pandemic presents material uncertainty and risk with respect to our business, financial condition and results of operations.

Moreover, to the extent any of these risks and uncertainties adversely impact us in the ways described above or otherwise, they may also have the effect of heightening many of the other risks set forth in this Annual Report on Form 10-K.

In addition, if in the future there is a further outbreak of COVID-19 or a variation thereof, an outbreak of another highly infectious or contagious disease or other health concern, the Company and our properties may be subject to similar risks as posed by COVID-19.

Uncertainty related to the unknown short- and long-term economic and behavioral impacts of the COVID-19 pandemic make forecasting rental rates and occupancies more difficult, and assets the Company acquires may not perform as expected.

In addition, at December 31, 2020, the Company had ownership interests in three major redevelopment projects aggregating 1,112 apartment homes with estimated redevelopment costs of $109.1 million, of which approximately $4.5 million remains to be expended.

Further, the development and redevelopment of communities is also subject to the general risks associated with real estate investments.

For further information regarding these risks, please see the risk factor above titled "*General real estate investment risks may adversely affect property income and values."*

Essex is the sole general partner of the Operating Partnership and, as of December 31, [removed: 2020,] [added: 2021,] had an approximately 96.6% general partner interest in the Operating Partnership.

As of December 31, [removed: 2020,] [added: 2021,] the Company owned or had ownership interests in [removed: 246] [added: 252] operating apartment communities, comprising [removed: 60,272] [added: 61,911] apartment homes, excluding the Company's ownership in preferred equity co-investments, loan investments, [removed: one] [added: three] operating commercial [removed: building] [added: buildings,] and a development pipeline comprised of [removed: three] [added: one] consolidated [removed: projects] [added: project] and [removed: three] [added: one] unconsolidated joint venture [removed: projects.][added: project.]

As of December 31, [removed: 2020,] [added: 2021,] the Company’s development pipeline was comprised of [removed: three] [added: one] consolidated [removed: projects] [added: project] under development, [removed: three] [added: one] unconsolidated joint venture [removed: projects] [added: project] under development, and various predevelopment projects aggregating [removed: 1,853] [added: 371] apartment homes, with total incurred costs of [removed: $948.0] [added: $156.0] million, and estimated remaining project costs of approximately [removed: $174.0] [added: $61.0] million, [removed: $118.0] [added: $32.6] million of which represents the Company's estimated remaining costs, for total estimated project costs of [removed: $1.1 billion.][added: $217.0 million.]

As of December 31, [removed: 2020,] [added: 2021,] the Company also had an ownership interest in [removed: one] [added: three] operating commercial [removed: building] [added: buildings] (totaling approximately [removed: 107,000] [added: 281,000] square feet).

By region, the Company's operating results for [removed: 2020] [added: 2021] and [removed: 2019] [added: 2020] and projection for [removed: 2021] [added: 2022] new housing supply (defined as new multifamily apartment homes and single family homes, excluding developments with fewer than 50 apartment homes as well as student, senior and 100% affordable housing), projection for [removed: 2021] [added: 2022] job growth, and [removed: 2021] [added: 2022] estimated Same-Property revenue [removed: decline] [added: growth] are as follows:

Southern California Region: As of December 31, [removed: 2020,] [added: 2021,] this region represented 43% of the Company’s consolidated operating apartment homes.

Revenues for [removed: "2020] [added: "2021] Same-Properties" (as defined below), or "Same-Property revenues," [removed: decreased 4.4%] [added: increased 3.2%] in [removed: 2020] [added: 2021] as compared to [removed: 2019.][added: 2020.]

In [removed: 2021,] [added: 2022,] the Company projects new residential supply of [removed: 26,500] [added: 31,750] apartment homes and single family homes, which represents [removed: 0.4%] [added: 0.5%] of the total housing stock.

The Company projects an increase of [removed: 231,000] [added: 310,000] jobs or [removed: 3.1%] [added: 4.0%] in the Southern California region.

Northern California Region: As of December 31, [removed: 2020,] [added: 2021,] this region represented 37% of the Company’s consolidated operating apartment homes.

Same-Property revenues decreased [removed: 4.9%] [added: 5.6%] in [removed: 2020] [added: 2021] as compared to [removed: 2019.][added: 2020.]

In [removed: 2021,] [added: 2022,] the Company projects new residential supply of [removed: 16,800] [added: 14,800] apartment homes and single family homes, which represents [removed: 0.7%] [added: 1.1%] of the total housing stock.

The Company projects an increase of [removed: 110,500] [added: 157,000] jobs or [removed: 3.4%] [added: 4.7%] in the Northern California region.

Seattle Metro Region: As of December 31, [removed: 2020,] [added: 2021,] this region represented 20% of the Company’s consolidated operating apartment homes.

Same-Property revenues decreased [removed: 0.6%] [added: 1.7%] in [removed: 2020] [added: 2021] as compared to [removed: 2019.][added: 2020.]

In [removed: 2021,] [added: 2022,] the Company projects new residential supply of [removed: 13,800] [added: 18,250] apartment homes and single family homes, which represents [removed: 1.1%] [added: 0.8%] of the total housing stock.

The Company projects an increase of [removed: 55,000] [added: 63,000] jobs or [removed: 3.3%] [added: 3.6%] in the Seattle Metro region.

*[Table [removed: of Contents](#i9e78b49d3c5c42cfa6fb60b4d7c56701_10)*][added: of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*]

In total, the Company projects [removed: a decrease] [added: an increase] in [removed: 2021] [added: 2022] Same-Property revenues of between [removed: 1.5%] [added: 7.0%] to [removed: 3.5%.][added: 8.5%.]

Same-Property operating expenses are projected to increase in [removed: 2021] [added: 2022] by [removed: 2.0%] [added: 3.5%] to [removed: 3.0%.][added: 4.5%.]

| | | | December 31, [removed: 2020] [added: 2021] | | | | | | | | | | | | December 31, [removed: 2019] [added: 2020] | | | | | | | | |

| Southern California | | | [removed: 22,560] [added: 22,190] | | | | | | 43 | | % | | | | [removed: 22,674] [added: 22,560] | | | | | | [removed: 45] [added: 43] | | % |

| Northern California | | | [removed: 19,319] [added: 19,123] | | | | | | 37 | | % | | | | [removed: 17,556] [added: 19,319] | | | | | | [removed: 35] [added: 37] | | % |

| Seattle Metro | | | [removed: 10,217] [added: 10,341] | | | | | | 20 | | % | | | | [removed: 10,343] [added: 10,217] | | | | | | 20 | | % |

| Total | | | [removed: 52,096] [added: 51,654] | | | | | | 100 | | % | | | | [removed: 50,573] [added: 52,096] | | | | | | 100 | | % |

Co-investments, including Wesco I, Wesco III, Wesco IV, Wesco V, [added: Wesco VI,] BEXAEW, BEX II, BEX [removed: III,] [added: IV,] and [removed: BEX IV] [added: 500 Folsom] communities, developments under construction, and preferred equity interest co-investment communities are not included in the table presented above for both periods.

[removed: Current Material Development – the] [added: The] COVID-19 Pandemic

The United States and other countries around the world are continuing to experience [removed: an unprecedented health pandemic] [added: impacts] related to [removed: COVID-19,] [added: the COVID-19 pandemic and its related variants] which has created considerable instability, disruption, and uncertainty.

Federal, state and local jurisdictions have [removed: issued and revised] [added: implemented] varying forms of [removed: "Shelter-in-Place" orders, halted or restricted] [added: requirements related to sponsors and patrons of] public gatherings and [removed: restricted business to only those that are considered "essential" or requiring] [added: required] businesses to make changes to their operations in a manner that negatively affects profitability, resulting in [removed: extraordinary] job losses and related financial impacts that [removed: will] [added: may] affect future operations to an unknown extent.

[removed: Moreover,] [added: While the California] eviction [added: moratorium sunsetted during the third quarter of 2021, other state and local eviction] moratoriums [removed: and,] [added: and] laws that limit rent increases during times of emergency and prohibit the ability to collect unpaid rent during certain [removed: timeframes, have been enacted] [added: timeframes continue to be] in [added: effect in] various formats at various [removed: levels of government, including] regions in which Essex's communities are located, impacting Essex [added: and its] properties.

- structuring payment plans for residents who are unable to pay their rent as a result of the outbreak and waiving late fees [added: where required or applicable] for those residents; and

The long-term impact will largely depend on future developments, which are highly uncertain and cannot be predicted, including, but not limited to, [removed: when a vaccine can be safely and widely distributed and] whether employees and employers will continue to promote remote work if and when the pandemic concludes.

This includes new information which may emerge concerning the severity of [removed: COVID-19,] [added: COVID-19 and related variants,] the success of actions taken to contain or treat [added: COVID-19, future laws that may be enacted, the impact on job growth and the broader economy, and reactions by consumers, companies, governmental entities and capital markets.]

Primarily as a result of the impact of the COVID-19 pandemic, the Company's cash delinquencies as a percentage of scheduled rental income for the Company’s stabilized apartment communities or "Same-Property" (stabilized properties consolidated by the Company for the years ended December 31, [removed: 2020] [added: 2021] and [removed: 2019) increased] [added: 2020) remained higher than the pre-pandemic period but improved] from [removed: 0.3%] [added: 2.5%] for [removed: 2019] [added: 2020] to [removed: 2.5%] [added: 1.9%] for [removed: 2020.][added: 2021.]

The Company has executed some payment plans and will continue to work with residents [removed: to execute payment plans related to such cash delinquencies.]

As of December 31, [removed: 2020,] [added: 2021,] the [removed: increase in] delinquencies [removed: has] [added: have] not had a material adverse impact to the Company's liquidity position.

The COVID-19 pandemic has not negatively impacted the Company's ability to access traditional funding sources on the same or reasonably similar terms as were available in recent periods prior to the pandemic, as demonstrated by the Company's financing activity during the year ended December 31, [removed: 2020] [added: 2021] discussed in the “Liquidity and Capital Resources" section below.

The Company’s average financial occupancy for the Company’s stabilized apartment communities or [removed: "2020] [added: "2021] Same-Property" (stabilized properties consolidated by the Company for the years ended December 31, [removed: 2020] [added: 2021] and [removed: 2019) decreased 60] [added: 2020) increased 40] basis points to [removed: 96.0%] [added: 96.4%] in [removed: 2020] [added: 2021] from [removed: 96.6%] [added: 96.0%] in [removed: 2019.][added: 2020.]

The regional breakdown of the Company’s [removed: 2020] [added: 2021] Same-Property portfolio for financial occupancy for the years ended December 31, [removed: 2020] [added: 2021] and [removed: 2019] [added: 2020] is as follows:

| | | | [added: | | | 2021 | | | | | |] 2020 | | | | | | 2019 | | |

A community previously held in the BEX III co-investment was consolidated in the second quarter of 2021 and is excluded from the December 31, 2020 table but included in the December 31, 2021 table.

Such measures include instituting a hybrid work model for corporate associates to work at the Company's corporate offices and remotely, and transitioning many public interactions with leasing staff to on-line and telephonic communications;

The labor shortage due partly to various government mandates and vaccine requirements implemented during the COVID-19 pandemic and supply chain disruptions may negatively impact the Company's results of operations.

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

to collect such cash delinquencies.

As a result of continued analysis of the collectability of delinquencies, reported delinquencies as a percentage of scheduled rent for the Company's Same-Property portfolio was 2.0% for the year ended December 31, 2021.

| | | | 2021 | | | | | | 2020 | | |

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

| Southern California | | | | | | 20,800 | | | | | | $ | 557,906 | | | | | $ | 540,771 | | | | | $ | 17,135 | | | | | 3.2 | | % |

| Northern California | | | | | | 16,072 | | | | | | 490,513 | | | | | | 519,746 | | | | | | (29,233) | | | | | | (5.6) | | % |

| Seattle Metro | | | | | | 10,218 | | | | | | 239,819 | | | | | | 243,900 | | | | | | (4,081) | | | | | | (1.7) | | % |

| Total 2021 Same-Property Revenues | | | | | | 47,090 | | | | | | 1,288,238 | | | | | | 1,304,417 | | | | | | (16,179) | | | | | | (1.2) | | % |

| 2021 Non-Same Property Revenues | | | | | | | | | | | | 143,180 | | | | | | 181,733 | | | | | | (38,553) | | | | | | (21.2) | | % |

| Total Property Revenues | | | | | | | | | | | | $ | 1,431,418 | | | | | $ | 1,486,150 | | | | | $ | (54,732) | | | | | (3.7) | | % |

*2021 Non-Same Property Revenues* decreased by $38.6 million or 21.2% to $143.2 million in 2021 compared to $181.7 million in 2020.

The decrease was primarily due to property dispositions in 2020 and the sale of Hidden Valley, Axis 2300, Park 20, and Devonshire Apartments in 2021 partially offset by the acquisition of The Village at Toluca Lake.

The decrease was primarily due to a decrease in revenues used to calculate management fees as well as a decrease of the management fee rate for one of the joint ventures.

*Real estate taxes* increased by $3.4 million or 1.9% to $180.4 million in 2021 compared to $177.0 million in 2020, primarily due to increases in assessed valuations and tax rates.

*Depreciation and amortization expense* decreased by $5.4 million or 1.0% to $520.1 million in 2021 compared to $525.5 million in 2020, primarily due to a decrease in amortization expense resulting from certain lease intangibles becoming fully amortized during 2020 and the sale of Hidden Valley, Axis 2300, Park 20, and Devonshire Apartments during 2021.

*Gain on sale of real estate and land* of $143.0 million in 2021 was attributable to the sale of Hidden Valley, Axis 2300, Park 20, and Devonshire Apartments during 2021.

These decreases in interest expense were partially offset by the issuance of new senior unsecured notes which resulted in an increase of $23.8 million interest expense for 2021 as compared to 2020.

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

*Interest and other income* increased by $57.7 million or 140.7% to $98.7 million in 2021 compared to $41.0 million in 2020, primarily due to increases of $34.3 million in insurance reimbursements, legal settlements and other driven by a one-time legal settlement claim, $20.6 million in unrealized gains on marketable securities, $7.9 million in marketable securities and other income, $4.9 million in income from early redemption of notes receivable, and $1.3 million in gain on sale of marketable securities.

These increases were offset by a $11.8 million decrease in interest income resulting from the maturity of a mortgage backed security investment in 2020.

*Equity income from co-investments* increased by $45.2 million or 68.0% to $111.7 million in 2021 compared to $66.5 million in 2020, primarily due to increases of $50.3 million in equity income from non-core co-investments and $11.6 million in income from preferred equity investments including income from early redemptions.

*Loss on early retirement of debt, net* of $19.0 million in 2021 was primarily due to the early termination of the Company's

five interest rate swap contracts in conjunction with the partial repayment of the Company's unsecured term debt and the early repayment of $300.0 million of senior unsecured notes.

*Gain on remeasurement of co-investment* of $2.3 million in 2021 resulted from the Company's purchase of BEX III's 50.0% interest in The Village at Toluca Lake community in the second quarter of 2021.

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

The 2021 ATM Program replaces the prior equity distribution agreement entered into in September 2018 (the "2018 ATM Program"), which was terminated upon the establishment of the 2021 ATM Program.

As of December 31, 2021, there were no outstanding forward purchase agreements, and $900.0 million of shares remain available to be sold under the 2021 ATM Program.

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

| Preferred equity investments | | | | | | 4 | | | | | | $ | 128,000 | | | | | $ | 27,867 | |

| Mezzanine loans | | | | | | 2 | | | | | | 140,000 | | | | | | 52,734 | | |

| Non-core co-investments | | | | | | — | | | | | | 37,000 | | | | | | 16,020 | | |

| | | | | | | | | | | | | $ | 396,162 | | | | | $ | 99,621 | |

At December 31, 2021, the Company had operating lease commitments of $167.4 million for ground, building and garage leases with maturity dates ranging from 2025 to 2083.

$7.0 million of this commitment is due within the next twelve months.

The Company defines critical accounting estimates as those estimates that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on the financial condition or results of operations of the Company.

Governmental authorities in impacted regions are taking dramatic and unpredictable actions in an effort to slow COVID-19’s spread.

Such measures include:

- closing the Company's corporate offices and instituting “work from home” measures for corporate associates;

- closing leasing offices to non-Essex personnel, reducing on-site staff so that hygiene and “social distancing” standards can be effectively managed and applied, and requiring face coverings to be worn;

- transitioning most public interactions with leasing staff to on-line and telephonic communications;

- increasing cleaning practices for common areas and community amenities and temporarily closing common areas and community amenities or opening with limited hours, limited capacity or by reservation only, depending in part on jurisdictional requirements; and

- delaying the response to maintenance orders in certain circumstances in order to promote the protection of the Company's employees and residents.

COVID-19, future laws that may be enacted, the impact on job growth and the broader economy, and reactions by consumers, companies, governmental entities and capital markets.

As part of this process, the Company assessed the collectability reserve attributable to those deferred payments and the anticipated execution of payment plans in the future, which partially mitigated the delinquencies resulting in actual delinquencies as a percentage of scheduled rent for the Company's Same-Property portfolio of 2.1% for the year ended December 31, 2020.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Southern California | | | | | | 20,800 | | | | | | $ | 540,771 | | | | | $ | 565,594 | | | | | $ | (24,823) | | | | | (4.4) | | % |

| Northern California | | | | | | 15,638 | | | | | | 504,300 | | | | | | 530,114 | | | | | | (25,814) | | | | | | (4.9) | | % |

| Seattle Metro | | | | | | 10,112 | | | | | | 241,615 | | | | | | 242,982 | | | | | | (1,367) | | | | | | (0.6) | | % |

| Total 2020 Same-Property Revenues | | | | | | 46,550 | | | | | | 1,286,686 | | | | | | 1,338,690 | | | | | | (52,004) | | | | | | (3.9) | | % |

| 2020 Non-Same Property Revenues | | | | | | | | | | | | 199,464 | | | | | | 111,938 | | | | | | 87,526 | | | | | | 78.2 | | % |

| Total Property Revenues | | | | | | | | | | | | $ | 1,486,150 | | | | | $ | 1,450,628 | | | | | $ | 35,522 | | | | | 2.4 | | % |

*2020 Non-Same Property Revenues* increased by $87.5 million or 78.2% to $199.5 million in 2020 compared to $111.9 million in 2019.

The increase was primarily due to revenues generated from the six communities that were consolidated as part of the Company's purchase of CPPIB's 45.0% co-investment interests in the first quarter of 2020, offset by the sale of One South Market, Delano, and 416 on Broadway during 2020.

*Real estate taxes* increased by $21.8 million or 14.0% to $177.0 million in 2020 compared to $155.2 million in 2019, primarily due to the additions of six communities that were consolidated in the first quarter of 2020 as part of the Company's purchase of CPPIB's 45.0% co-investment interests.

*Depreciation and amortization expense* increased by $41.7 million or 8.6% to $525.5 million in 2020 compared to $483.8 million in 2019, primarily due to the additions of six communities that were consolidated in the first quarter of 2020 as part of the Company's purchase of CPPIB's 45.0% co-investment interests offset by the sale of One South Market, Delano, and 416 on Broadway during 2020.

*Impairment loss* of $1.8 million in 2020 was related to one of the Company's consolidated properties as a result of a change in the Company's intent to hold the property for its remaining useful life.

The Company's $3.2 million loss on sale of real estate and land in 2019 was attributable to the sale of land in San Mateo, CA that had been held for future development.

*Interest expense* increased by $3.3 million or 1.5% to $220.6 million in 2020 compared to $217.3 million in 2019*,* primarily due to an increase in average outstanding debt primarily as a result of the issuance of $500.0 million of senior unsecured notes due March 1, 2029 in February and March 2019, $550.0 million of senior unsecured notes due January 15, 2030 in August and October 2019, $650 million of senior unsecured notes due March 15, 2032 in February and June 2020, and $600 million of senior unsecured notes due January 15, 2031 and September 1, 2050 in August 2020, which resulted in an increase of $37.6 million interest expense for 2020 as compared to 2019.

*Interest and other income* decreased $5.3 million or 11.4% to $41.0 million in 2020 compared to $46.3 million in 2019, primarily due to a decrease of $16.8 million in marketable securities and other income, offset by an increase in unrealized gains on marketable securities of $6.8 million and an increase in interest income of $4.7 million from the maturity of a mortgage backed security investment recognized in 2020 which resulted in the reversal of the estimated credit loss on the investment.

*Equity income from co-investments* decreased by $45.6 million or 40.7% to $66.5 million in 2020 compared to $112.1 million in 2019, primarily due to a decrease of $48.9 million in gains from the sale of co-investment communities, and a decrease of $16.5 million in equity income from co-investments of which, $9.1 million was as a result of the Company's purchase of CPPIB's 45.0% co-investment interests.

*Loss on early retirement of debt, net* of $22.9 million in 2020 was primarily due to early repayment of a $297.7 million secured mortgage note payable in the first and second quarters of 2020, and the early repayment of $600.0 million of senior unsecured notes during the third and fourth quarters of 2020.

Gain on remeasurement of $31.5 million in 2019 resulted from the purchase of the Company's joint venture partner's 45.0% membership interest in the One South Market co-investment in March 2019.

The United States and other countries around the world are experiencing an unprecedented health pandemic related to COVID-19, which has created considerable instability and disruption in the U.S. and world economies.

As of December 31, 2020, the Company had $4.9 billion of fixed rate public bonds outstanding at an average interest rate of 3.4% with maturity dates ranging from 2023 to 2050.

As of December 31, 2020, the Company had $550.0 million outstanding on its unsecured term loan.

$350.0 million of the unsecured term loan bears a variable interest rate of LIBOR plus 0.95% and matures in February 2022.

$200.0 million of the unsecured term loan bears a variable interest rate of LIBOR plus 1.20% and matures in April 2021 with two 12-month extension options, exercisable at the Company's option.

The Company has five interest rate swap contracts, with an aggregate notional balance of $175.0 million, which effectively converts the interest rate on $175.0 million of the unsecured term loan to a fixed rate of 2.3%.

As of December 31, 2020, there was no

The Company has entered into interest rate swap contracts with an aggregate notional amount of $175.0 million that effectively fixed the interest rate on the $175.0 million of the $550.0 million unsecured term loan at 2.3%.

These derivatives qualify for hedge accounting.

In September 2018, the Company filed a new shelf registration statement with the SEC, allowing the Company to sell an undetermined number or amount of certain equity and debt securities of the Company, as defined in the prospectus contained in the shelf registration statement.

stock at the time the agreement is executed, but defer receiving the proceeds from the sale of shares until a later date.

The Company anticipates using the net proceeds, which are contributed to the Operating Partnership, to acquire, develop, or redevelop properties, which primarily will be apartment communities, to make other investments and for working capital or general corporate purposes, which may include the repayment of indebtedness.

*[Table [removed: of Contents](#i9e78b49d3c5c42cfa6fb60b4d7c56701_10)*][added: of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*]

Additionally, the Company has entered into total return swap contracts, with an aggregate notional amount of [removed: $254.8] [added: $224.4] million that effectively convert [removed: $225.1] [added: $224.4] million of fixed mortgage notes payable [removed: and $29.7 million of mortgage notes payable related] to [removed: real estate held for sale that is included in liabilities associated with real estate held for sale on the consolidated balance sheet to] a floating interest rate based on the SIFMA plus a spread and have a carrying value of zero at December 31, [removed: 2020.][added: 2021.]

Management has estimated the fair value of the Company’s [removed: $5.5] [added: $5.8] billion of fixed rate debt at December 31, [removed: 2020,] [added: 2021,] to be $6.0 billion.

[removed: Management has estimated the fair value of the Company’s $775.1 million of variable rate debt at December 31, 2020, to be $770.1 million based on the] terms of existing mortgage notes payable and variable rate demand notes compared to those available in the marketplace.

| ($ in thousands, except for interest rates) | | | [removed: 2021] [added: 2022] | | | | | | [removed: 2022] [added: 2023] | | | | | | [removed: 2023] [added: 2024] | | | | | | [removed: 2024] [added: 2025] | | | | | | [removed: 2025] [added: 2026] | | | | | | Thereafter | | | Total | | | | | | Fair value | | |

| Average interest rate | | | [removed: 4.3%] [added: 3.6%] | | | | | | [removed: 3.7%] [added: 3.4%] | | | | | | [removed: 3.7%] [added: 4.0%] | | | | | | [removed: 4.0%] [added: 3.5%] | | | | | | 3.5% | | | | | | [removed: 3.3%] [added: 3.2%] | | | | | | | | | | | |

| Average interest rate | | | [removed: 1.3%] [added: 1.2%] | | | | | | [removed: 1.8%] [added: 1.1%] | | | | | | [removed: 1.5%] [added: 1.2%] | | | | | | [removed: 1.3%] [added: 1.2%] | | | | | | [removed: 1.3%] [added: 1.2%] | | | | | | 1.1% | | | | | | | | | | | |

The table incorporates only those exposures that exist as of December 31, [removed: 2020;] [added: 2021;] it does not consider those exposures or positions that could arise after that date.

As of December 31, 2021, the Company had no outstanding interest rate swap contracts.

Management has estimated the fair value of the Company’s $565.6 million of variable rate debt at December 31, 2021, to be $561.7 million based on the

| Fixed rate debt | | | $42,408 | | | | | | $302,093 | | | | | | $402,177 | | | | | | $632,035 | | | | | | $548,291 | | | | | | $3,836,558 | | | $5,763,562 | | | | | | $5,996,335 | | |

| Variable rate debt (1) | | | $780 | | | | | | $2,109 | | | | | | $932 | | | | | | $1,019 | | | | | | $1,114 | | | | | | $559,666 | | | $565,620 | | | | | | $561,670 | | |

(1)$224.4 million of variable rate debt is tax exempt to the note holders.

As of December 31, 2020, the Company had entered into five interest rate swap contracts to mitigate the risk of changes in the interest-related cash outflows on $175.0 million of the unsecured term debt.

As of December 31, 2020, the Company also had $225.1 million of secured variable rate indebtedness.

All of the Company’s interest rate swaps are designated as cash flow hedges as of December 31, 2020.

The following table summarizes the notional amount, carrying value, and estimated fair value of the Company’s cash flow hedge derivative instruments used to hedge interest rates as of December 31, 2020.

The notional amount represents the aggregate amount of a particular security that is currently hedged at one time, but does not represent exposure to credit, interest rates or market risks.

The table also includes a sensitivity analysis to demonstrate the impact on the Company’s derivative instruments from an increase or decrease in 10-year Treasury bill interest rates by 50 basis points, as of December 31, 2020.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | | | | | | | Carrying and | | | | | | Estimated Carrying Value | | | | | | | | |

| | | | | | | | | | | | | Maturity | | | | | | Estimated | | | | | | \+ 50 | | | | | | \- 50 | | |

| ($ in thousands) | | | | | | Notional Amount | | | | | | Date Range | | | | | | Fair Value | | | | | | Basis Points | | | | | | Basis Points | | |

| Cash flow hedges: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Interest rate swaps | | | | | | $ | 175,000 | | | | | 2022 | | | | | | $ | (2,373) | | | | | $ | (1,412) | | | | | $ | (3,350) | |

| Total cash flow hedges | | | | | | $ | 175,000 | | | | | 2022 | | | | | | $ | (2,373) | | | | | $ | (1,412) | | | | | $ | (3,350) | |

| Fixed rate debt | | | $202,788 | | | | | | $42,408 | | | | | | $602,093 | | | | | | $402,177 | | | | | | $632,035 | | | | | | $3,634,849 | | | $5,516,350 | | | | | | $6,030,203 | | |

| Variable rate debt (1) | | | $713 | | | | | | $350,780 | | | | | | $200,852 | | | | | | $932 | | | | | | $1,019 | | | | | | $220,780 | | | $775,076 | | | | | | $770,075 | | |

(1)$175.0 million is subject to interest rate protection agreements ($175.0 million is subject to interest rate swaps).

$225.1 million of variable rate debt in the table above excludes $29.7 million of variable rate debt related to real estate held for sale that is included in liabilities associated with real estate held for sale on the consolidated balance sheet and both amounts are subject to total return swaps.

Essex is the sole general partner of the Operating Partnership and as of December 31, [removed: 2020,] [added: 2021,] had an approximately 96.6% general partnership interest in the Operating Partnership.

As of December 31, [removed: 2020,] [added: 2021,] the Company owned or had ownership interests in [removed: 246] [added: 252] operating apartment communities, aggregating [removed: 60,272] [added: 61,911] apartment homes, excluding the Company's ownership in preferred equity co-investments, loan investments, [removed: one] [added: three] operating commercial [removed: building,] [added: buildings,] and a development pipeline comprised of [removed: three] [added: one] consolidated [removed: projects] [added: project] and [removed: three] [added: one] unconsolidated joint venture [removed: projects] [added: project] aggregating [removed: 1,853] [added: 371] apartment homes (collectively, the "Portfolio").

*[Table [removed: of Contents](#i9e78b49d3c5c42cfa6fb60b4d7c56701_10)*][added: of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*]

The [removed: table] [added: tables] below [removed: summarizes] [added: summarize] acquisition activity for the year ended December 31, [removed: 2020] [added: 2021] ($ in millions):

| Property Name [added: (1)] | | | | | | Location | | | | | | Apartment Homes | | | | | | Essex Ownership Percentage | | | | | | Ownership | | | | | | Quarter in [removed: 2020] [added: 2021] | | | | | | Purchase Price | | | [added: | | |]

The Company may use the capital generated from the dispositions to invest in higher-return [removed: communities or] [added: communities,] other real estate [removed: investments,] [added: investments] or to [removed: repay debts.][added: fund other commitments.]

[added: (1)] The Company recognized a [removed: $22.7] [added: $69.2] million gain on sale.

[added: (3)] The Company recognized a [removed: $25.7] [added: $30.8] million gain on sale.

As of December 31, [removed: 2020,] [added: 2021,] the Company's development pipeline was comprised of [removed: three] [added: one] consolidated [removed: projects] [added: project] under development and [removed: three] [added: one] unconsolidated joint venture [removed: projects] [added: project] under development aggregating [removed: 1,853] [added: 371] apartment homes, with total incurred costs of [removed: $948.0] [added: $156.0] million, and estimated remaining project costs of approximately [removed: $174.0] [added: $61.0] million, [removed: $118.0] [added: $32.6] million of which represents the Company's [added: share of] estimated remaining costs, for total estimated project costs of [removed: $1.1 billion.][added: $217.0 million.]

As of December 31, [removed: 2020,] [added: 2021,] the Company had various consolidated predevelopment projects.

| Station Park Green - Phase IV | | | | | | San Mateo, CA | | | | | | 100% | | | | | | 107 | | | | | | [removed: 66] [added: $] | [added: 91] | | | | | [removed: 94] [added: $] | [added: 94] | |

| Total Development Projects - Consolidated | | | | | | | | | | | | | | | | | | [removed: 783] [added: 107] | | | | | | [removed: 376] [added: 91] | | | | | | [removed: 436] [added: 94] | | |

| Scripps Mesa Apartments [removed: (3)] [added: (2)] | | | | | | San Diego, CA | | | | | | 51% | | | | | | 264 | | | | | | [removed: 16] [added: 44] | | | | | | 102 | | |

| Total Development Projects - Joint Venture | | | | | | | | | | | | | | | | | | [removed: 1,070] [added: 264] | | | | | | [removed: 551] [added: 44] | | | | | | [removed: 665] [added: 102] | | |

| Grand Total - Development and Predevelopment Pipeline | | | | | | | | | | | | | | | | | | [removed: 1,853] [added: 371] | | | | | | $ | [removed: 948] [added: 156] | | | | | $ | [removed: 1,122] [added: 217] | |

[removed: (3)Estimated] [added: (2)Incurred] project cost [removed: for this development is] [added: and estimated project cost are] net of a projected value for [removed: low-income] [added: low income] housing tax credit proceeds and the value of the [removed: tax exempt] [added: tax-exempt] bond structure.

During [removed: 2020,] [added: 2021,] the Company made regularly scheduled principal payments and loan payoffs of [removed: $316.2] [added: $3.5] million to its secured mortgage notes payable at an average interest rate of [removed: 4.4%.][added: 2.9%.]

In [removed: February 2020,] [added: March 2021,] the Operating Partnership issued [removed: $500.0] [added: $450.0] million of senior unsecured notes due on March [removed: 15, 2032,] [added: 1, 2028] with a coupon rate of [removed: 2.650%] [added: 1.700% per annum] (the [removed: "2032] [added: "2028] Notes"), which are payable on March [removed: 15] [added: 1] and September [removed: 15] [added: 1] of each year, beginning on September [removed: 15, 2020.][added: 1, 2021.]

The [removed: 2032] [added: 2028] Notes were offered to investors at a price of [removed: 99.628%] [added: 99.423%] of par value.

[added: The 2028 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.

The [removed: proceeds were] [added: Company] used [added: the net proceeds of this offering] to repay [removed: indebtedness under the Company's] [added: upcoming debt maturities, including all or a portion of certain] unsecured [removed: credit facilities] [added: term loans,] and for [removed: other] general corporate and working capital purposes.

The 2031 Notes were offered to investors at a price of [removed: 99.035% of par value and the 2050 Notes at 99.691%] [added: 99.367%] of par value.

The [added: 2031] 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.

The Company used the net proceeds of this offering to repay [added: upcoming] debt maturities, including [removed: certain unsecured private placement notes, secured mortgage notes, and] to fund the redemption of $300.0 million aggregate principal amount [added: (plus the make-whole amount and accrued and unpaid interest)] of [added: its outstanding 3.375% senior unsecured notes due January 2023, and for other general corporate and working capital purposes.]

As of December 31, [removed: 2020,] [added: 2021,] Moody’s Investor Service and Standard and Poor's ("S&P") credit agencies rated Essex Property Trust, Inc. and Essex Portfolio, L.P. Baa1/Stable and BBB+/Stable, respectively.

At December 31, [removed: 2020,] [added: 2021,] the Company had two unsecured lines of credit aggregating $1.24 billion.

The Company's $1.2 billion credit facility had an interest rate of LIBOR plus [removed: 0.825%,] [added: 0.775%,] with a scheduled maturity date in [removed: December 2023] [added: September 2025] with [removed: one 18-month extension,] [added: three 6-month extensions,] exercisable at the Company's option.

The Company's $35.0 million working capital unsecured line of credit had an interest rate of LIBOR plus [removed: 0.825%,] [added: 0.775%,] with a scheduled maturity date in February 2023.

During the year ended December 31, [removed: 2020,] [added: 2021,] the Company did not issue any shares of common stock through [removed: its equity distribution program.][added: the 2021 ATM Program or through the 2018 ATM Program.]

As of December 31, [removed: 2020,] [added: 2021,] there were no outstanding forward sale agreements, and [removed: $826.6] [added: $900.0] million of shares remain available to be sold under [removed: this program.][added: the 2021 ATM Program.]

During the year ended December 31, [removed: 2020,] [added: 2021,] the Company repurchased and retired [removed: 1,197,190] [added: 40,000] shares totaling [removed: $269.3] [added: $9.2] million, including commissions.

[removed: In each] [added: As] of [removed: May and] December [removed: 2020, the board of directors approved the replenishment of the stock repurchase plan such that, as of each of those dates,] [added: 31, 2021,] the Company had [removed: $250.0] [added: $214.5] million of purchase authority remaining under [removed: the replenished] [added: its $250.0 million stock repurchase] plan.

The Company is headquartered in San Mateo, CA, and has regional offices in Woodland Hills, CA; Irvine, [removed: CA; San Diego,] CA and Bellevue, WA.

As of December 31, [removed: 2020,] [added: 2021,] the Company had [removed: 1,799] [added: 1,757] employees, [removed: ninety-eight] [added: ninety-nine] percent [removed: (98%)] [added: (99%)] of which were full-time employees, and of which [removed: 1,483] [added: 1,382] employees worked in operations and [removed: 316] [added: 375] were employed in the corporate offices.

The Company [added: believes it] has one of the most diverse workforces among its peers in the real estate industry.

As of December 31, [removed: 2020,] [added: 2021,] the Company's workforce was approximately [removed: 44%] [added: 43%] Hispanic or Latino, 29% White, 12% Asian, [removed: 7%] [added: 8%] Black or African American, 1% Native Hawaiian or other Pacific Islander, 1% American Indian or Alaska Native, and [removed: 6%] [added: 5%] two or more races.

As of December 31, [removed: 2020,] [added: 2021,] the Company's workforce was 42% female and 58% male, of which corporate associates were [removed: 54%] [added: 56%] female and on-site operational associates were [removed: 40%] [added: 38%] female.

The Company had [removed: 365] [added: 308] females in positions of manager or higher, representing [removed: 67%] [added: 65%] of managerial positions.

The tables below detail the [added: Company's] gender representation by position [removed: in the Company] and the age diversity of its workforce.

The Company [removed: recently implemented additional] [added: believes that its robust and integrated diversity, equity, and inclusion strategy, which utilizes] training [removed: programs as well as] [added: programs,] employee [removed: committees] [added: committees, and executive sponsorships] to strengthen and [removed: further] promote diversity, equal opportunity, and fair treatment for all Company associates.

For the year ended December 31, 2021, the Company purchased or increased its interests in six communities consisting of 1,033 apartment homes and two commercial properties for approximately $432.3 million.

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| The Village at Toluca Lake (2) | | | | | | Burbank, CA | | | | | | 145 | | | | | | 100 | | % | | | | EPLP | | | | | | Q2 | | | | | | $ | 31.8 | | | | |

| Martha Lake Apartments | | | | | | Lynwood, WA | | | | | | 155 | | | | | | 50 | | % | | | | Wesco VI | | | | | | Q3 | | | | | | 53.0 | | | (3) | | |

| Monterra in Mill Creek | | | | | | Mill Creek, WA | | | | | | 139 | | | | | | 50 | | % | | | | Wesco VI | | | | | | Q4 | | | | | | 55.0 | | | (3) | | |

| The Rexford | | | | | | Fremont, CA | | | | | | 203 | | | | | | 50 | | % | | | | Wesco VI | | | | | | Q4 | | | | | | 112.5 | | | (3) | | |

| Silver (4) | | | | | | San Jose, CA | | | | | | 268 | | | | | | 58 | | % | | | | GR Block C | | | | | | Q4 | | | | | | 132.4 | | | (3) | | |

| Canvas | | | | | | Seattle, WA | | | | | | 123 | | | | | | 100 | | % | | | | EPLP | | | | | | Q4 | | | | | | 47.6 | | | | | |

| Total 2021 | | | | | | | | | | | | 1,033 | | | | | | | | | | | | | | | | | | | | | | | | $ | 432.3 | | | | |

(1)In November 2021, the Company purchased a managing interest in a single asset entity owning a 179-unit apartment home community located in Vista, CA, for a contract price of $44.0 million, at the Company’s pro rata share.

(2) In June 2021, the Company purchased the joint venture partner's 50.0% membership interest in the BEX III, LLC co-investment that owned The Village at Toluca Lake based on a property valuation of $63.5 million.

In conjunction with the acquisition, $29.5 million of mortgage debt that encumbered the property was paid off.

(3) Represents the contact price for the entire property, not the Company’s share.

(4) In November 2021, the Company converted its existing $11.0 million preferred equity investment in Silver into a 58.0% equity ownership interest in the property.

Based on a consolidation analysis, the Company accounts for this investment under the equity method investment.

For the year ended December 31, 2021, the Company purchased two fully-leased commercial properties for approximately $86.0 million.

| Property Name | | | | | | Location | | | | | | Ownership | | | | | | Quarter in 2021 | | | | | | Purchase Price | | |

| 7 South Linden | | | | | | South San Francisco, CA | | | | | | EPLP | | | | | | Q3 | | | | | | $ | 33.5 | |

| Third & Broad | | | | | | Seattle, WA | | | | | | EPLP | | | | | | Q3 | | | | | | 52.5 | | |

| Total 2021 | | | | | | | | | | | | | | | | | | | | | | | | $ | 86.0 | |

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

For the year ended December 31, 2021, the Company sold four communities consisting of 912 apartment homes for approximately $330.0 million.

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| Property Name | | | | | | Location | | | | | | Apartment Homes | | | | | | Ownership | | | | | | Quarter in 2021 | | | | | | Sales Price (in millions) | | | | | |

| Hidden Valley | | | | | | Simi Valley, CA | | | | | | 324 | | | | | | EPLP | | | | | | Q1 | | | | | | $ | 105.0 | | (1) | | |

| Park 20 | | | | | | San Mateo, CA | | | | | | 197 | | | | | | EPLP | | | | | | Q1 | | | | | | 113.0 | | | (2) | | |

| Axis 2300 | | | | | | Irvine, CA | | | | | | 115 | | | | | | EPLP | | | | | | Q1 | | | | | | 57.5 | | | (3) | | |

| Devonshire Apartments | | | | | | Hemet, CA | | | | | | 276 | | | | | | EPLP | | | | | | Q3 | | | | | | 54.5 | | | (4) | | |

| Total 2021 | | | | | | | | | | | | 912 | | | | | | | | | | | | | | | | | | $ | 330.0 | | | | |

In conjunction with the sale, the Company repaid $29.7 million of mortgage debt that encumbered the property.

(2) The Company recognized an immaterial gain on sale.

(4) The Company recognized a $42.9 million gain on sale.

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

| | | | | | | | | | | | | | | | | | | | | | | | | 12/31/2021 | | | | | | | | |

In June 2021, the Operating Partnership issued $300.0 million of senior unsecured notes due on June 15, 2031 with a coupon rate of 2.550% per annum (the "2031 Notes"), which are payable on June 15 and December 15 of each year, beginning on December 15, 2021.

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

In September 2021, the Company entered into a new equity distribution agreement pursuant to which the Company may offer and sell shares of its common stock having an aggregate gross sales price of up to $900.0 million (the “2021 ATM Program”).

In connection with the 2021 ATM Program, the Company may also enter into related forward sale agreements, and may sell shares of its common stock pursuant to these agreements.

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| CPPIB Portfolio(1) | | | | | | Various | | | | | | 2,020 | | | | | | 100 | | % | | | | EPLP | | | | | | Q1 | | | | | | $ | 463.4 | |

| Total 2020 | | | | | | | | | | | | 2,020 | | | | | | | | | | | | | | | | | | | | | | | | $ | 463.4 | |

(1)In January 2020, the Company purchased the joint venture partner's 45% membership interest in a land parcel and six communities representing 2,020 apartment homes based on a total valuation of approximately $1.0 billion.

In June 2020, the Company completed a portfolio sale which consisted of two apartment communities with 429 apartment homes, One South Market and Museum Park, both located in San Jose, CA, for a total contract price of $232.0 million, resulting in a gain of $16.6 million for the Company.

In July 2020, the Company sold Delano, a 126 apartment home community located in Redmond, WA, for a total contract price of $51.5 million.

In October 2020, the Company sold 416 on Broadway, a 115 apartment home community located in Glendale, CA, for a total contract price of $60.0 million.

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| | | | | | | | | | | | | | | | | | | | | | | | | 12/31/2020 | | | | | | | | |

| Mylo | | | | | | Santa Clara, CA | | | | | | 100% | | | | | | 476 | | | | | | 213 | | | | | | 226 | | |

| Wallace on Sunset (2) | | | | | | Hollywood, CA | | | | | | 100% | | | | | | 200 | | | | | | 97 | | | | | | 116 | | |

| Patina at Midtown | | | | | | San Jose, CA | | | | | | 50% | | | | | | 269 | | | | | | 135 | | | | | | 148 | | |

| 500 Folsom (3) | | | | | | San Francisco, CA | | | | | | 50% | | | | | | 537 | | | | | | 400 | | | | | | 415 | | |

(2)Incurred and estimated project costs for this development is net of cost incurred on the adjacent theatre at the property.

Redevelopment Pipeline

The Company defines redevelopment communities as existing properties owned or recently acquired, which have been targeted for additional investment by the Company with the expectation of increased financial returns through property improvement.

During redevelopment, apartment homes may not be available for rent and, as a result, the related apartment community may have less than stabilized operations.

As of December 31, 2020, the Company had ownership interests in three major redevelopment communities aggregating 1,112 apartment homes with estimated redevelopment costs of $109.1 million, of which approximately $4.5 million remains to be expended.

The 2032 Notes are general

The Company used the net proceeds of this offering to repay indebtedness under its unsecured lines of credit, which had been used to fund the buyout of the Canada Pension Plan Investment Board's ("CPPIB" or "CPP") 45.0% joint venture interests, as well as repay $100.3 million of secured debt during the quarter that ended March 31, 2020.

In June 2020, the Operating Partnership issued an additional $150.0 million of the 2032 Notes at a price of 105.660% of par value, plus accrued interest from February 2020 up to, but not including, the date of delivery of the additional notes, with an effective yield of 2.093%.

These additional notes have substantially identical terms as the 2032 Notes issued in February 2020.

In April 2020, the Company obtained a $200.0 million unsecured term loan with a one-year maturity and two 12-month extension options, exercisable at the Company’s option.

The unsecured term loan bears a variable interest rate of the London Interbank Offered Rate ("LIBOR") plus 1.20% and the proceeds were used to repay all remaining consolidated debt maturing in 2020.

In August 2020, the Operating Partnership issued $600.0 million of senior unsecured notes, consisting of $300.0 million aggregate principal amount due on January 15, 2031 with a coupon rate of 1.650% (the “2031 Notes”) and $300.0 million aggregate principal amount due on September 1, 2050 with a coupon rate of 2.650% (the “2050 Notes” and together with the 2031 Notes, the “Notes”).

Interest is payable on the 2031 Notes semiannually on January 15 and July 15 of each year, beginning on January 15, 2021.

Interest is payable on the 2050 Notes semiannually on March 1 and September 1 of each year, beginning on March 1, 2021.

its outstanding 3.625% senior unsecured notes due August 2022, and for other general corporate and working capital purposes.

As a result, as of December 31, 2020, the Company had $223.6 million of purchase authority remaining under its $250.0 million stock repurchase plan.

The Company undertakes a wide spectrum of initiatives to support a diverse workforce particularly in regards to ethnic, gender and age diversity as well as fair treatment of all our associates.

Additionally, the Company implemented Diversity, Equity & Inclusion listening sessions where associates were invited to engage with one another through sharing personal and professional experiences involving diversity, equity, and inclusion, fostering a more positive and inclusive environment throughout the Company.

The Company was awarded the National Association of Real Estate Investment Trusts’ (“NAREIT"), which is the leading REIT industry association, Diversity and Inclusion Corporate Recognition Award for 2020.

This annual recognition is designed to recognize strong commitments and outstanding contributions to the advancement of diversity and inclusion within our Company, our professional network, and in the REIT community

| <= 25 | | | | | | 180 | | | | | | 10% | | |

| 26-35 | | | | | | 544 | | | | | | 30% | | |

| 36-45 | | | | | | 426 | | | | | | 24% | | |

| 46-55 | | | | | | 375 | | | | | | 21% | | |

| 56-65 | | | | | | 232 | | | | | | 13% | | |

| \> 65 | | | | | | 42 | | | | | | 2% | | |

For the fiscal year ended December 31, [removed: 2020][added: 2021]

As of June 30, [removed: 2020,] [added: 2021,] the aggregate market value of the voting stock held by non-affiliates of Essex Property Trust, Inc. was [removed: $14,874,979,309.][added: $19,372,879,492.]

As of February [removed: 17, 2021, 64,994,503] [added: 23, 2022, 65,278,686] shares of common stock ($.0001 par value) of Essex Property Trust, Inc. were outstanding.

Portions of the definitive Proxy Statement to be filed with the Securities and Exchange Commission (the "SEC") pursuant to Regulation 14A in connection with the [removed: 2021] [added: 2022] annual meeting of stockholders of Essex Property Trust, Inc. are incorporated by reference in Part III of this Annual Report on Form 10-K.

Such Proxy Statement will be filed with the SEC within 120 days of December 31, [removed: 2020.][added: 2021.]

This report combines the annual reports on Form 10-K for the year ended December 31, [removed: 2020] [added: 2021] of Essex Property Trust, Inc., a Maryland corporation, and Essex Portfolio, L.P., a Delaware limited partnership of which Essex Property Trust, Inc. is the sole general partner.

As of December 31, [removed: 2020,] [added: 2021,] Essex owned approximately 96.6% of the ownership interest in the Operating Partnership with the remaining 3.4% interest owned by limited partners.

To help investors understand the significant differences between Essex and the Operating Partnership, this report [added: on Form 10-K] provides separate 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 [added: on Form 10-K] also includes separate Part II, Item 9A.

In order to highlight the differences between Essex and the Operating Partnership, the separate sections in this report [added: on Form 10-K] for Essex and the Operating Partnership specifically refer to Essex and the Operating Partnership.

[removed: 2020] [added: 2021] ANNUAL REPORT ON FORM 10-K

| Item 1. | | | [removed: [Business](#i9e78b49d3c5c42cfa6fb60b4d7c56701_16)] [added: [Business](#i981a22c87c7d4319aa4bec2f94174cb0_19)] | | | [removed: [3](#i9e78b49d3c5c42cfa6fb60b4d7c56701_16)] [added: [3](#i981a22c87c7d4319aa4bec2f94174cb0_19)] | | |

| Item 1A. | | | [Risk [removed: Factors](#i9e78b49d3c5c42cfa6fb60b4d7c56701_19)] [added: Factors](#i981a22c87c7d4319aa4bec2f94174cb0_22)] | | | [removed: [11](#i9e78b49d3c5c42cfa6fb60b4d7c56701_19)] [added: [11](#i981a22c87c7d4319aa4bec2f94174cb0_22)] | | |

| Item 1B. | | | [Unresolved Staff [removed: Comments](#i9e78b49d3c5c42cfa6fb60b4d7c56701_22)] [added: Comments](#i981a22c87c7d4319aa4bec2f94174cb0_25)] | | | [removed: [32](#i9e78b49d3c5c42cfa6fb60b4d7c56701_22)] [added: [29](#i981a22c87c7d4319aa4bec2f94174cb0_25)] | | |

| Item 2. | | | [removed: [Properties](#i9e78b49d3c5c42cfa6fb60b4d7c56701_25)] [added: [Properties](#i981a22c87c7d4319aa4bec2f94174cb0_28)] | | | [removed: [33](#i9e78b49d3c5c42cfa6fb60b4d7c56701_25)] [added: [30](#i981a22c87c7d4319aa4bec2f94174cb0_28)] | | |

| Item 3. | | | [Legal [removed: Proceedings](#i9e78b49d3c5c42cfa6fb60b4d7c56701_28)] [added: Proceedings](#i981a22c87c7d4319aa4bec2f94174cb0_31)] | | | [removed: [40](#i9e78b49d3c5c42cfa6fb60b4d7c56701_28)] [added: [37](#i981a22c87c7d4319aa4bec2f94174cb0_31)] | | |

| Item 4. | | | [Mine Safety [removed: Disclosures](#i9e78b49d3c5c42cfa6fb60b4d7c56701_31)] [added: Disclosures](#i981a22c87c7d4319aa4bec2f94174cb0_34)] | | | [removed: [40](#i9e78b49d3c5c42cfa6fb60b4d7c56701_31)] [added: [37](#i981a22c87c7d4319aa4bec2f94174cb0_34)] | | |

| Item 5. | | | [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity [removed: Securities](#i9e78b49d3c5c42cfa6fb60b4d7c56701_37)] [added: Securities](#i981a22c87c7d4319aa4bec2f94174cb0_40)] | | | [removed: [41](#i9e78b49d3c5c42cfa6fb60b4d7c56701_37)] [added: [38](#i981a22c87c7d4319aa4bec2f94174cb0_40)] | | |

| Item 7. | | | [Management's Discussion and Analysis of Financial Condition and Results of [removed: Operations](#i9e78b49d3c5c42cfa6fb60b4d7c56701_43)] [added: Operations](#i981a22c87c7d4319aa4bec2f94174cb0_46)] | | | [removed: [46](#i9e78b49d3c5c42cfa6fb60b4d7c56701_43)] [added: [43](#i981a22c87c7d4319aa4bec2f94174cb0_46)] | | |

| Item 7A. | | | [Quantitative and Qualitative Disclosures About Market [removed: Risks](#i9e78b49d3c5c42cfa6fb60b4d7c56701_55)] [added: Risks](#i981a22c87c7d4319aa4bec2f94174cb0_58)] | | | [removed: [59](#i9e78b49d3c5c42cfa6fb60b4d7c56701_55)] [added: [55](#i981a22c87c7d4319aa4bec2f94174cb0_58)] | | |

| Item 8. | | | [Financial Statements and Supplementary [removed: Data](#i9e78b49d3c5c42cfa6fb60b4d7c56701_58)] [added: Data](#i981a22c87c7d4319aa4bec2f94174cb0_61)] | | | [removed: [60](#i9e78b49d3c5c42cfa6fb60b4d7c56701_58)] [added: [56](#i981a22c87c7d4319aa4bec2f94174cb0_61)] | | |

| Item 9. | | | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#i9e78b49d3c5c42cfa6fb60b4d7c56701_61)] [added: Disclosure](#i981a22c87c7d4319aa4bec2f94174cb0_64)] | | | [removed: [61](#i9e78b49d3c5c42cfa6fb60b4d7c56701_61)] [added: [56](#i981a22c87c7d4319aa4bec2f94174cb0_64)] | | |

| Item 9A. | | | [Controls and [removed: Procedures](#i9e78b49d3c5c42cfa6fb60b4d7c56701_64)] [added: Procedures](#i981a22c87c7d4319aa4bec2f94174cb0_67)] | | | [removed: [61](#i9e78b49d3c5c42cfa6fb60b4d7c56701_64)] [added: [56](#i981a22c87c7d4319aa4bec2f94174cb0_67)] | | |

| Item 9B. | | | [Other [removed: Information](#i9e78b49d3c5c42cfa6fb60b4d7c56701_67)] [added: Information](#i981a22c87c7d4319aa4bec2f94174cb0_70)] | | | [removed: [62](#i9e78b49d3c5c42cfa6fb60b4d7c56701_67)] [added: [57](#i981a22c87c7d4319aa4bec2f94174cb0_70)] | | |

| Item 10. | | | [Directors, Executive Officers and Corporate [removed: Governance](#i9e78b49d3c5c42cfa6fb60b4d7c56701_73)] [added: Governance](#i981a22c87c7d4319aa4bec2f94174cb0_76)] | | | [removed: [63](#i9e78b49d3c5c42cfa6fb60b4d7c56701_73)] [added: [58](#i981a22c87c7d4319aa4bec2f94174cb0_76)] | | |

| Item 11. | | | [Executive [removed: Compensation](#i9e78b49d3c5c42cfa6fb60b4d7c56701_76)] [added: Compensation](#i981a22c87c7d4319aa4bec2f94174cb0_79)] | | | [removed: [63](#i9e78b49d3c5c42cfa6fb60b4d7c56701_76)] [added: [58](#i981a22c87c7d4319aa4bec2f94174cb0_79)] | | |

| Item 12. | | | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#i9e78b49d3c5c42cfa6fb60b4d7c56701_79)] [added: Matters](#i981a22c87c7d4319aa4bec2f94174cb0_82)] | | | [removed: [63](#i9e78b49d3c5c42cfa6fb60b4d7c56701_79)] [added: [58](#i981a22c87c7d4319aa4bec2f94174cb0_82)] | | |

| Item 13. | | | [Certain Relationships and Related Transactions, and Director [removed: Independence](#i9e78b49d3c5c42cfa6fb60b4d7c56701_82)] [added: Independence](#i981a22c87c7d4319aa4bec2f94174cb0_85)] | | | [removed: [63](#i9e78b49d3c5c42cfa6fb60b4d7c56701_82)] [added: [58](#i981a22c87c7d4319aa4bec2f94174cb0_85)] | | |

| Item 14. | | | [Principal Accounting Fees and [removed: Services](#i9e78b49d3c5c42cfa6fb60b4d7c56701_85)] [added: Services](#i981a22c87c7d4319aa4bec2f94174cb0_88)] | | | [removed: [63](#i9e78b49d3c5c42cfa6fb60b4d7c56701_85)] [added: [58](#i981a22c87c7d4319aa4bec2f94174cb0_88)] | | |

| Item 15. | | | [Exhibits and Financial Statement [removed: Schedules](#i9e78b49d3c5c42cfa6fb60b4d7c56701_91)] [added: Schedules](#i981a22c87c7d4319aa4bec2f94174cb0_94)] | | | [removed: [64](#i9e78b49d3c5c42cfa6fb60b4d7c56701_91)] [added: [59](#i981a22c87c7d4319aa4bec2f94174cb0_94)] | | |

| Item 16. | | | [Form 10-K [removed: Summary](#i9e78b49d3c5c42cfa6fb60b4d7c56701_91)] [added: Summary](#i981a22c87c7d4319aa4bec2f94174cb0_94)] | | | [removed: [64](#i9e78b49d3c5c42cfa6fb60b4d7c56701_91)] [added: [59](#i981a22c87c7d4319aa4bec2f94174cb0_94)] | | |

*[Table [removed: of Contents](#i9e78b49d3c5c42cfa6fb60b4d7c56701_10)*][added: of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*]

[added: -] Rent control, or other changes in applicable laws, or noncompliance with applicable laws, could adversely affect the Company's [removed: operations] [added: operations, property values] or expose us to liability.

- The current COVID-19 pandemic, or the future outbreak of other highly infectious or contagious [removed: diseases, and the timing and effectiveness of vaccine distribution,] [added: diseases] could materially and adversely affect our business, financial condition and results of operations.

- Capital and credit market conditions may affect the Company’s access to sources of capital and/or the cost of capital, which could negatively affect the Company’s business, [added: stock price,] results of operations, cash flows and financial condition.

Auditor Name: KPMG LLP Location: San Francisco, California PCAOB ID: 185

| Item 6. | | | [\[Reserved\]](#i981a22c87c7d4319aa4bec2f94174cb0_43) | | | [42](#i981a22c87c7d4319aa4bec2f94174cb0_43) | | |

| Item 9C. | | | [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](#i981a22c87c7d4319aa4bec2f94174cb0_2256) | | | [57](#i981a22c87c7d4319aa4bec2f94174cb0_2256) | | |

| [Signatures](#i981a22c87c7d4319aa4bec2f94174cb0_211) | | | | | | [S-](#i981a22c87c7d4319aa4bec2f94174cb0_211)[1](#i981a22c87c7d4319aa4bec2f94174cb0_211) | | |

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

Debt financing has inherent risks.

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

| Item 6. | | | [Selected Financial Data](#i9e78b49d3c5c42cfa6fb60b4d7c56701_40) | | | [45](#i9e78b49d3c5c42cfa6fb60b4d7c56701_40) | | |

| [Signatures](#i9e78b49d3c5c42cfa6fb60b4d7c56701_250) | | | | | | [S-](#i9e78b49d3c5c42cfa6fb60b4d7c56701_250)[1](#i9e78b49d3c5c42cfa6fb60b4d7c56701_250) | | |

- Our apartment communities may be subject to unknown or contingent liabilities which could cause us to incur substantial costs, including environmental liabilities or general uninsured losses.

Debt financing has inherent risks, and may result in insufficient cash flow to service debt and fund distributions.

*[Table [removed: of Contents](#i9e78b49d3c5c42cfa6fb60b4d7c56701_10)*][added: of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*]

The Company’s portfolio as of December 31, [removed: 2020] [added: 2021] (including communities owned by unconsolidated joint ventures, but excluding communities underlying preferred equity investments) was comprised of [removed: 246] [added: 252] stabilized operating apartment communities (comprising [removed: 60,272] [added: 61,911] apartment homes), of which [removed: 26,581] [added: 26,245] apartment homes are located in Southern California, [removed: 21,584] [added: 23,141] apartment homes are located in Northern California, and [removed: 12,107] [added: 12,525] apartment homes are located in the Seattle metropolitan area.

The Company’s apartment communities accounted for [removed: 99.4%] [added: 99.3%] of the Company’s revenues for the year ended December 31, [removed: 2020.][added: 2021.]

Financial occupancy is defined as the percentage resulting from dividing actual rental income by total [removed: potential] [added: scheduled] rental income.

Total [removed: potential] [added: scheduled] rental income represents the value of all apartment homes, with occupied apartment homes valued at contractual rental rates pursuant to leases and vacant apartment homes valued at estimated market rents.

As of December 31, [removed: 2020,] [added: 2021,] the Company’s communities include [removed: 103] [added: 104] garden-style, [removed: 134] [added: 138] mid-rise, and [removed: 9] [added: 10] high-rise communities.

The communities have an average of approximately [removed: 245] [added: 246] apartment homes, with a mix of studio, one-, two- and some three-bedroom apartment homes.

The Company owns [removed: an office building] [added: three commercial buildings] with approximately [removed: 107,000] [added: 281,000] square feet located in [removed: Irvine, CA,] [added: California and Washington,] of which the Company occupied approximately 14,000 square feet as of December 31, [removed: 2020.][added: 2021.]

Furthermore, as of December 31, [removed: 2020,] [added: 2021,] the [removed: office building's] [added: commercial buildings'] physical occupancy rate was [removed: 100%] [added: 98%] consisting of 7 tenants, including the Company.

The table below describes the Company’s operating portfolio as of December 31, [removed: 2020.][added: 2021.]

*[Table [removed: of Contents](#i9e78b49d3c5c42cfa6fb60b4d7c56701_10)*][added: of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*]

| Anavia | | | | | | Anaheim, CA | | | | | | Mid-rise | | | | | | 250 | | | | | | 2009 | | | | | | 2010 | | | | | | [removed: 97%] [added: 96%] | | |

| Bonita Cedars | | | | | | Bonita, CA | | | | | | Garden | | | | | | 120 | | | | | | 1983 | | | | | | 2002 | | | | | | [removed: 97%] [added: 98%] | | |

| [added: The] Village at Toluca Lake [removed: (5)] | | | | | | Burbank, CA | | | | | | Mid-rise | | | | | | 145 | | | | | | 1974 | | | | | | 2017 | | | | | | [removed: 95%] [added: 98%] | | |

| Camarillo Oaks | | | | | | Camarillo, CA | | | | | | Garden | | | | | | 564 | | | | | | 1985 | | | | | | 1996 | | | | | | [removed: 97%] [added: 98%] | | |

| Pinnacle at Otay Ranch I & II | | | | | | Chula Vista, CA | | | | | | Mid-rise | | | | | | 364 | | | | | | 2001 | | | | | | 2014 | | | | | | [removed: 98%] [added: 97%] | | |

| Mesa Village | | | | | | Clairemont, CA | | | | | | Garden | | | | | | 133 | | | | | | 1963 | | | | | | 2002 | | | | | | [removed: 96%] [added: 94%] | | |

| Villa Siena | | | | | | Costa Mesa, CA | | | | | | Garden | | | | | | 272 | | | | | | 1974 | | | | | | 2014 | | | | | | [removed: 96%] [added: 97%] | | |

| Regency at Encino | | | | | | Encino, CA | | | | | | Mid-rise | | | | | | 75 | | | | | | 1989 | | | | | | 2009 | | | | | | [removed: 94%] [added: 96%] | | |

| The Havens [removed: (6)] [added: (5)] | | | | | | Fountain Valley, CA | | | | | | Garden | | | | | | 440 | | | | | | 1969 | | | | | | 2014 | | | | | | [removed: 96%] [added: 97%] | | |

| Haver Hill [removed: (7)] [added: (6)] | | | | | | Fullerton, CA | | | | | | Garden | | | | | | 264 | | | | | | 1973 | | | | | | 2012 | | | | | | [removed: 97%] [added: 98%] | | |

| Pinnacle at Fullerton | | | | | | Fullerton, CA | | | | | | Mid-rise | | | | | | 192 | | | | | | 2004 | | | | | | 2014 | | | | | | [removed: 96%] [added: 97%] | | |

| Wilshire Promenade | | | | | | Fullerton, CA | | | | | | Mid-rise | | | | | | 149 | | | | | | 1992 | | | | | | 1997 | | | | | | [removed: 95%] [added: 97%] | | |

| The Henley I | | | | | | Glendale, CA | | | | | | Mid-rise | | | | | | 83 | | | | | | 1974 | | | | | | 1999 | | | | | | [removed: 95%] [added: 97%] | | |

| The Henley II | | | | | | Glendale, CA | | | | | | Mid-rise | | | | | | 132 | | | | | | 1970 | | | | | | 1999 | | | | | | [removed: 95%] [added: 97%] | | |

| CBC and The Sweeps | | | | | | Goleta, CA | | | | | | Garden | | | | | | 239 | | | | | | 1962 | | | | | | 2006 | | | | | | [removed: 92%] [added: 95%] | | |

| Huntington Breakers | | | | | | Huntington Beach, CA | | | | | | Mid-rise | | | | | | 342 | | | | | | 1984 | | | | | | 1997 | | | | | | [removed: 97%] [added: 96%] | | |

| The Huntington | | | | | | Huntington Beach, CA | | | | | | Garden | | | | | | 276 | | | | | | 1975 | | | | | | 2012 | | | | | | [removed: 96%] [added: 97%] | | |

| Hillsborough Park [removed: (8)] [added: (7)] | | | | | | La Habra, CA | | | | | | Garden | | | | | | 235 | | | | | | 1999 | | | | | | 1999 | | | | | | 98% | | |

| The Palms at Laguna Niguel | | | | | | Laguna Niguel, CA | | | | | | Garden | | | | | | 460 | | | | | | 1988 | | | | | | 2014 | | | | | | [removed: 97%] [added: 98%] | | |

| Trabuco Villas | | | | | | Lake Forest, CA | | | | | | Mid-rise | | | | | | 132 | | | | | | 1985 | | | | | | 1997 | | | | | | [removed: 98%] [added: 99%] | | |

| Marbrisa | | | | | | Long Beach, CA | | | | | | Mid-rise | | | | | | 202 | | | | | | 1987 | | | | | | 2002 | | | | | | [removed: 96%] [added: 97%] | | |

| Pathways at Bixby Village | | | | | | Long Beach, CA | | | | | | Garden | | | | | | 296 | | | | | | 1975 | | | | | | 1991 | | | | | | [removed: 96%] [added: 97%] | | |

| 5600 Wilshire | | | | | | Los Angeles, CA | | | | | | Mid-rise | | | | | | 284 | | | | | | 2008 | | | | | | 2014 | | | | | | [removed: 95%] [added: 97%] | | |

| Alessio | | | | | | Los Angeles, CA | | | | | | Mid-rise | | | | | | 624 | | | | | | 2001 | | | | | | 2014 | | | | | | [removed: 94%] [added: 95%] | | |

| Avant | | | | | | Los Angeles, CA | | | | | | Mid-rise | | | | | | 440 | | | | | | 2014 | | | | | | 2015 | | | | | | [removed: 97%] [added: 95%] | | |

| Bellerive | | | | | | Los Angeles, CA | | | | | | Mid-rise | | | | | | 63 | | | | | | 2011 | | | | | | 2011 | | | | | | [removed: 96%] [added: 95%] | | |

| Bunker Hill | | | | | | Los Angeles, CA | | | | | | High-rise | | | | | | 456 | | | | | | 1968 | | | | | | 1998 | | | | | | [removed: 94%] [added: 95%] | | |

| Cochran Apartments | | | | | | Los Angeles, CA | | | | | | Mid-rise | | | | | | 58 | | | | | | 1989 | | | | | | 1998 | | | | | | [removed: 91%] [added: 96%] | | |

| Gas Company Lofts [removed: (7)] [added: (6)] | | | | | | Los Angeles, CA | | | | | | High-rise | | | | | | 251 | | | | | | 2004 | | | | | | 2013 | | | | | | 95% | | |

| Marbella | | | | | | Los Angeles, CA | | | | | | Mid-rise | | | | | | 60 | | | | | | 1991 | | | | | | 2005 | | | | | | [removed: 91%] [added: 96%] | | |

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

| Wallace on Sunset | | | | | | Los Angeles, CA | | | | | | Mid-rise | | | | | | 200 | | | | | | 2021 | | | | | | 2021 | | | | | | 96% | | |

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

| Passage Buena Vista (14) | | | | | | Vista, CA | | | | | | Garden | | | | | | 179 | | | | | | 2020 | | | | | | 2021 | | | | | | 97% | | |

| | | | | | | | | | | | | | | | | | | 26,245 | | | | | | | | | | | | | | | | | | 97% | | |

| The Rexford (16) | | | | | | Fremont, CA | | | | | | Garden | | | | | | 203 | | | | | | 1973 | | | | | | 2021 | | | | | | 100% | | |

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

| 500 Folsom (14) | | | | | | San Francisco, CA | | | | | | High-rise | | | | | | 537 | | | | | | 2021 | | | | | | 2021 | | | | | | 100% | | |

| Patina at Midtown (14) | | | | | | San Jose, CA | | | | | | Mid-rise | | | | | | 269 | | | | | | 2021 | | | | | | 2021 | | | | | | 80% | | |

| Silver (14) | | | | | | San Jose, CA | | | | | | Mid-rise | | | | | | 268 | | | | | | 2019 | | | | | | 2021 | | | | | | 91% | | |

| Mylo | | | | | | Santa Clara, CA | | | | | | Mid-rise | | | | | | 476 | | | | | | 2021 | | | | | | 2021 | | | | | | 96% | | |

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

| | | | | | | | | | | | | | | | | | | 23,141 | | | | | | | | | | | | | | | | | | 96% | | |

| Martha Lake Apartments (16) | | | | | | Lynwood, WA | | | | | | Mid-rise | | | | | | 155 | | | | | | 1991 | | | | | | 2021 | | | | | | 97% | | |

| Monterra in Mill Creek (16) | | | | | | Mill Creek, WA | | | | | | Garden | | | | | | 139 | | | | | | 2003 | | | | | | 2021 | | | | | | 97% | | |

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

| Canvas | | | | | | Seattle, WA | | | | | | Mid-rise | | | | | | 123 | | | | | | 2014 | | | | | | 2021 | | | | | | 100% | | |

| | | | | | | | | | | | | | | | | | | 12,525 | | | | | | | | | | | | | | | | | | 96% | | |

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

(14)The Company has an interest in a single asset entity owning this community.

| Devonshire | | | | | | Hemet, CA | | | | | | Garden | | | | | | 276 | | | | | | 1988 | | | | | | 2002 | | | | | | 98% | | |

| Axis 2300 | | | | | | Irvine, CA | | | | | | Mid-rise | | | | | | 115 | | | | | | 2010 | | | | | | 2010 | | | | | | 96% | | |

| Hidden Valley | | | | | | Simi Valley, CA | | | | | | Garden | | | | | | 324 | | | | | | 2004 | | | | | | 2004 | | | | | | 97% | | |

| | | | | | | | | | | | | | | | | | | 26,581 | | | | | | | | | | | | | | | | | | 96% | | |

| Park 20 | | | | | | San Mateo, CA | | | | | | Mid-rise | | | | | | 197 | | | | | | 2015 | | | | | | 2015 | | | | | | 97% | | |

| | | | | | | | | | | | | | | | | | | 21,584 | | | | | | | | | | | | | | | | | | 96% | | |

| | | | | | | | | | | | | | | | | | | 12,107 | | | | | | | | | | | | | | | | | | 96% | | |

(17)The Company has 50% ownership in this community, which is accounted for using the equity method of accounting.

(20)This community is subject to a ground lease, which, unless extended, will expire in 2070.

*[Table [removed: of Contents](#i9e78b49d3c5c42cfa6fb60b4d7c56701_10)*][added: of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*]

The approximate number of holders of record of the shares of Essex's common stock was [removed: 1,191] [added: 1,121] as of February [removed: 17, 2021.][added: 23, 2022.]

As of February [removed: 17, 2021,] [added: 23, 2022,] there were [removed: 67] [added: 65] holders of record of OP Units, including Essex.

The status of the cash dividends distributed for the years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018] [added: 2019] related to common stock are as follows:

| | | | | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2018] [added: 2019] | | |

| Ordinary income | | | | | | [removed: 85.23] [added: 70.92] | | % | | | | [removed: 83.81] [added: 85.23] | | % | | | | [removed: 79.72] [added: 83.81] | | % |

| Capital gain | | | | | | [removed: 10.68] [added: 22.07] | | % | | | | [removed: 13.78] [added: 10.68] | | % | | | | [removed: 15.35] [added: 13.78] | | % |

| Unrecaptured section 1250 capital gain | | | | | | [removed: 4.09] [added: 7.01] | | % | | | | [removed: 2.41] [added: 4.09] | | % | | | | [removed: 4.93] [added: 2.41] | | % |

The Board of Directors declared a dividend/distribution for the fourth quarter of [removed: 2020] [added: 2021] of [removed: $2.0775] [added: $2.09] per share.

The dividend/distribution was paid on January [removed: 15, 2021] [added: 14, 2022] to stockholders/unitholders of record as of January [removed: 4, 2021.][added: 3, 2022.]

*[Table [removed: of Contents](#i9e78b49d3c5c42cfa6fb60b4d7c56701_10)*][added: of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*]

The information required by this section is incorporated herein by reference from our Proxy Statement, relating to our [removed: 2021] [added: 2022] Annual Meeting of Shareholders, under the headings "Equity Compensation Plan Information," to be filed with the SEC within 120 days of December 31, [removed: 2020.][added: 2021.]

During the year ended December 31, [removed: 2020,] [added: 2021,] the Company did not issue any shares of common stock [removed: through its equity distribution program.][added: under the 2021 ATM Program or the 2018 ATM Program.]

As of December 31, [removed: 2020,] [added: 2021,] there were no outstanding forward sale agreements, and [removed: $826.6] [added: $900.0] million of shares [removed: remains] [added: remain] available to be sold under [removed: this program.][added: the 2021 ATM Program.]

During the year ended December 31, [removed: 2020,] [added: 2021,] the Company repurchased and retired [removed: 1,197,190] [added: 40,000] shares of its common stock totaling [removed: $269.3] [added: $9.2] million, including commissions, at an average price of [removed: $224.96] [added: $229.30] per share.

As of December 31, [removed: 2020,] [added: 2021,] the Company had [removed: $223.6] [added: $214.5] million of purchase authority remaining under the stock repurchase plan.

This comparison assumes that the value of the investment in the common stock and each index was $100 on December 31, [removed: 2015] [added: 2016] and that all dividends were reinvested.

[removed: ][added: ]

| Index | | | | | | [removed: 12/31/2015] [added: 12/31/2016] | | | | | | [removed: 12/31/2016] [added: 12/31/2017] | | | | | | [removed: 12/31/2017] [added: 12/31/2018] | | | | | | [removed: 12/31/2018] [added: 12/31/2019] | | | | | | [removed: 12/31/2019] [added: 12/31/2020] | | | | | | [removed: 12/31/2020] [added: 12/31/2021] | | |

During the years ended December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] the Operating Partnership issued OP Units in private placements in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act, in the amounts and for the consideration set forth below:

During the years ended December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] Essex issued an aggregate of [removed: 70,802] [added: 248,725] and [removed: 178,675] [added: 70,802] shares of its common stock upon the exercise of stock options, respectively.

Essex contributed the proceeds from the option exercises of [removed: $14.9] [added: $58.5] million and [removed: $37.5] [added: $14.9] million to the Operating Partnership in exchange for an aggregate of [removed: 70,802] [added: 248,725] and [removed: 178,675] [added: 70,802] OP Units, as required by the Operating Partnership’s partnership agreement, during the years ended December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] respectively.

During the years ended December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] Essex issued an aggregate of [removed: 24,666] [added: 30,360] and [removed: 16,114] [added: 24,666] shares of its common stock in connection with restricted stock awards for no cash consideration, respectively.

Partnership's partnership agreement, for an aggregate of [removed: 24,666] [added: 30,360] and [removed: 16,114] [added: 24,666] OP Units during the years ended December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] respectively.

During the years ended December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] Essex issued an aggregate of [removed: 8,783] [added: 10,293] and [removed: 12,633] [added: 8,783] shares of its common stock in connection with the exchange of OP Units [removed: and DownREIT units] by limited partners [removed: or members] into shares of common [removed: stock, respectively.][added: stock.]

For each share of common stock issued by Essex in connection with such exchange, the Operating Partnership issued OP Units to Essex as required by the Operating Partnership's partnership agreement, for an aggregate of [removed: 8,783] [added: 10,293] and [removed: 12,633] [added: 8,783] OP Units during the year ended December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] respectively.

As of December 31, [removed: 2020,] [added: 2021,] there were no outstanding forward [removed: purchase] [added: sale] agreements.

In September 2021, the Company entered into the 2021 ATM Program, a new equity distribution agreement pursuant to which the Company may offer and sell shares of its common stock having an aggregate gross sales price of up to $900.0 million.

In connection with the 2021 ATM Program, the Company may also enter into related forward sale agreements, and may sell shares of its common stock pursuant to these agreements.

The use of a forward sale agreement would allow the Company to lock in a share price on the sale of shares of its common stock at the time the agreement is executed, but defer receipt of the proceeds from the sale of shares until a later date should the Company elect to settle such forward sale agreement, in whole or in part, in shares of its common stock.

All of such purchases occurred during the three months ended March 31, 2021, and the Company did not repurchase any shares in 2021 subsequent to March 31, 2021.

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

| Essex Property Trust, Inc. | | | | | | $ | 100.00 | | | | | $ | 106.82 | | | | | $ | 111.98 | | | | | $ | 141.00 | | | | | $ | 115.49 | | | | | $ | 176.01 | |

| NAREIT All Equity REIT Index | | | | | | $ | 100.00 | | | | | $ | 108.67 | | | | | $ | 104.28 | | | | | $ | 134.17 | | | | | $ | 127.30 | | | | | $ | 179.87 | |

| S&P 500 Index | | | | | | $ | 100.00 | | | | | $ | 121.83 | | | | | $ | 116.49 | | | | | $ | 153.17 | | | | | $ | 181.35 | | | | | $ | 233.41 | |

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

During the year ended December 31, 2021 and 2020, the Company did not issue or sell any shares of common stock pursuant to the 2021 ATM Program or the 2018 ATM Program.

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

| Essex Property Trust, Inc. | | | | | | 100.00 | | | | | | 99.87 | | | | | | 106.66 | | | | | | 111.75 | | | | | | 140.70 | | | | | | 115.26 | | |

| NAREIT All Equity REIT Index | | | | | | 100.00 | | | | | | 108.63 | | | | | | 118.05 | | | | | | 113.28 | | | | | | 145.75 | | | | | | 138.28 | | |

| S&P 500 Index | | | | | | 100.00 | | | | | | 111.96 | | | | | | 136.40 | | | | | | 130.42 | | | | | | 171.49 | | | | | | 203.04 | | |

During the year ended December 31, 2019, 228,271 shares of the Company's common stock were issued or sold by Essex pursuant to its equity distribution programs.

Stock Repurchases

The following table summarizes the Company's purchase of its common stock during the three months ended December 31, 2020:

| | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | Total Number of Shares Purchased | | | | | | Average Price Paid Per Share | | | | | | Total Number of Shares Purchased as Part of a Publicly Announced Program(1) | | | | | | Maximum Dollar Value of Shares that May Yet Be Purchased Under the Program (in millions)(1) | | |

| October 1, 2020 - October 31, 2020 | | | | | | 56,600 | | | | | | $ | 191.05 | | | | | 56,600 | | | | | | $ | 192.5 | |

| November 1, 2020 - November 30, 2020 | | | | | | 33,182 | | | | | | 196.59 | | | | | | 33,182 | | | | | | 186.0 | | |

| December 1, 2020 - December 31, 2020 | | | | | | 121,899 | | | | | | 237.80 | | | | | | 121,899 | | | | | | 223.6 | | |

| Total | | | | | | 211,681 | | | | | | $ | 218.84 | | | | | 211,681 | | | | | | $ | 223.6 | |

(1) In December 2020, the Board of Directors approved the replenishment of the stock repurchase plan such that, as of such date, the Company had $250.0 million of purchase authority remaining under the replenished plan.

*[Table [removed: of Contents](#i9e78b49d3c5c42cfa6fb60b4d7c56701_10)*][added: of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*]

Not applicable.

*[Table of Contents](#i9e78b49d3c5c42cfa6fb60b4d7c56701_10)*

As of December 31, [removed: 2020,] [added: 2021,] Essex carried out an evaluation, under the supervision and with the participation of management, including Essex's Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of Essex's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act).

Based upon that evaluation, Essex’s Chief Executive Officer and Chief Financial Officer concluded that as of December 31, [removed: 2020,] [added: 2021,] Essex’s disclosure controls and procedures were effective to ensure that the information required to be disclosed by Essex in the reports that Essex files or submits under the Exchange Act was recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and that such disclosure controls and procedures were also effective to ensure that information required to be disclosed in the reports that Essex files or submits under the Exchange Act is accumulated and communicated to Essex’s management, including Essex’s Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

There were no changes in Essex’s internal control over financial reporting, that occurred during the quarter ended December 31, [removed: 2020,] [added: 2021,] that have materially affected, or are reasonably likely to materially affect, Essex’s internal control over financial reporting.

Essex’s management assessed the effectiveness of Essex’s internal control over financial reporting as of December 31, [removed: 2020.][added: 2021.]

Essex’s management has concluded that, as of December 31, [removed: 2020,] [added: 2021,] its internal control over financial reporting was effective based on these criteria.

As of December 31, [removed: 2020,] [added: 2021,] the Operating Partnership carried out an evaluation, under the supervision and with the participation of management, including Essex's Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Operating Partnership's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act).

Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that as of December 31, [removed: 2020,] [added: 2021,] the Operating Partnership’s disclosure controls and procedures were effective to ensure that the information required to be disclosed by the Operating Partnership in the reports that the Operating Partnership files or submits under the Exchange Act was recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and that such disclosure controls and procedures were also effective to ensure that information required to be disclosed in the reports that the Operating Partnership files or submits under the Exchange Act is accumulated and communicated to the Operating Partnership’s management, including Essex's Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

There were no changes in the Operating Partnership’s internal control over financial reporting, that occurred during the quarter ended December 31, [removed: 2020,] [added: 2021,] that have materially affected, or are reasonably likely to materially affect, the Operating Partnership’s internal control over financial reporting.

The Operating Partnership’s management assessed the effectiveness of the Operating Partnership’s internal control over financial reporting as of December 31, [removed: 2020.][added: 2021.]

The Operating Partnership’s management has concluded that, as of December 31, [removed: 2020,] [added: 2021,] its internal control over financial reporting was effective based on these criteria.

*[Table [removed: of Contents](#i9e78b49d3c5c42cfa6fb60b4d7c56701_10)*][added: of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*]

*[Table of Contents](#i9e78b49d3c5c42cfa6fb60b4d7c56701_10)*

PART III

Not applicable.

*[Table of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*

PART III

The information required by this Item is incorporated herein by reference from our Proxy Statement, relating to our [removed: 2021] [added: 2022] Annual Meeting of Stockholders, under the heading "Board and Corporate Governance Matters," to be filed with the SEC within 120 days of December 31, [removed: 2020.][added: 2021.]

The information required by this Item is incorporated herein by reference from our Proxy Statement, relating to our [removed: 2021] [added: 2022] Annual Meeting of Stockholders, under the headings "Executive Compensation" and "Director Compensation," to be filed with the SEC within 120 days of December 31, [removed: 2020.][added: 2021.]

The information required by this Item is incorporated herein by reference from our Proxy Statement, relating to our [removed: 2021] [added: 2022] Annual Meeting of Stockholders, under the heading "Security Ownership of Certain Beneficial Owners and Management," to be filed with the SEC within 120 days of December 31, [removed: 2020.][added: 2021.]

The information required by this Item is incorporated herein by reference from our Proxy Statement, relating to our [removed: 2021] [added: 2022] Annual Meeting of Stockholders, under the heading "Certain Relationships and Related Persons Transactions," to be filed with the SEC within 120 days of December 31, [removed: 2020.][added: 2021.]

The information required by this Item is incorporated herein by reference from our Proxy Statement, relating to our [removed: 2021] [added: 2022] Annual Meeting of Stockholders, under the headings "Report of the Audit Committee" and "Fees Paid to KPMG LLP," to be filed with the SEC within 120 days of December 31, [removed: 2020.][added: 2021.]

*[Table [removed: of Contents](#i9e78b49d3c5c42cfa6fb60b4d7c56701_10)*][added: of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*]

| Reports of Independent Registered Public Accounting Firm [added: (PCAOB ID: 185)] | | | [removed: [F-](#i9e78b49d3c5c42cfa6fb60b4d7c56701_94)[1](#i9e78b49d3c5c42cfa6fb60b4d7c56701_94)] [added: [F-](#i981a22c87c7d4319aa4bec2f94174cb0_97)[1](#i981a22c87c7d4319aa4bec2f94174cb0_97)] | | |

| Consolidated Balance Sheets: As of December 31, [removed: 2020] [added: 2021] and [removed: 2019] [added: 2020] | | | [removed: [F-](#i9e78b49d3c5c42cfa6fb60b4d7c56701_103)[6](#i9e78b49d3c5c42cfa6fb60b4d7c56701_103)] [added: [F-](#i981a22c87c7d4319aa4bec2f94174cb0_106)[6](#i981a22c87c7d4319aa4bec2f94174cb0_106)] | | |

| Consolidated Statements of Income: Years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018] [added: 2019] | | | [removed: [F-](#i9e78b49d3c5c42cfa6fb60b4d7c56701_109)[7](#i9e78b49d3c5c42cfa6fb60b4d7c56701_109)] [added: [F-](#i981a22c87c7d4319aa4bec2f94174cb0_109)[7](#i981a22c87c7d4319aa4bec2f94174cb0_109)] | | |

| Consolidated Statements of Comprehensive Income: Years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018] [added: 2019] | | | [removed: [F-](#i9e78b49d3c5c42cfa6fb60b4d7c56701_112)[8](#i9e78b49d3c5c42cfa6fb60b4d7c56701_112)] [added: [F-](#i981a22c87c7d4319aa4bec2f94174cb0_112)[8](#i981a22c87c7d4319aa4bec2f94174cb0_112)] | | |

| Consolidated Statements of Equity: Years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018] [added: 2019] | | | [removed: [F-](#i9e78b49d3c5c42cfa6fb60b4d7c56701_115)[9](#i9e78b49d3c5c42cfa6fb60b4d7c56701_115)] [added: [F-](#i981a22c87c7d4319aa4bec2f94174cb0_115)[9](#i981a22c87c7d4319aa4bec2f94174cb0_115)] | | |

| Consolidated Statements of Cash Flows: Years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018] [added: 2019] | | | [removed: [F-](#i9e78b49d3c5c42cfa6fb60b4d7c56701_121)[11](#i9e78b49d3c5c42cfa6fb60b4d7c56701_121)] [added: [F-](#i981a22c87c7d4319aa4bec2f94174cb0_118)[11](#i981a22c87c7d4319aa4bec2f94174cb0_118)] | | |

| Notes to Consolidated Financial Statements | | | [removed: [F-](#i9e78b49d3c5c42cfa6fb60b4d7c56701_145)[20](#i9e78b49d3c5c42cfa6fb60b4d7c56701_145)] [added: [F-](#i981a22c87c7d4319aa4bec2f94174cb0_136)[20](#i981a22c87c7d4319aa4bec2f94174cb0_136)] | | |

| Report of Independent Registered Public Accounting Firm | | | [removed: [F](#i9e78b49d3c5c42cfa6fb60b4d7c56701_100)[\-](#i9e78b49d3c5c42cfa6fb60b4d7c56701_100)[4](#i9e78b49d3c5c42cfa6fb60b4d7c56701_100)] [added: [F-](#i981a22c87c7d4319aa4bec2f94174cb0_103)[4](#i981a22c87c7d4319aa4bec2f94174cb0_103)] | | |

| Consolidated Balance Sheets: As of December 31, [removed: 2020] [added: 2021] and [removed: 2019] [added: 2020] | | | [removed: [F-](#i9e78b49d3c5c42cfa6fb60b4d7c56701_124)[13](#i9e78b49d3c5c42cfa6fb60b4d7c56701_124)] [added: [F-](#i981a22c87c7d4319aa4bec2f94174cb0_121)[13](#i981a22c87c7d4319aa4bec2f94174cb0_121)] | | |

| Consolidated Statements of Income: Years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018] [added: 2019] | | | [removed: [F-](#i9e78b49d3c5c42cfa6fb60b4d7c56701_130)[14](#i9e78b49d3c5c42cfa6fb60b4d7c56701_130)] [added: [F-](#i981a22c87c7d4319aa4bec2f94174cb0_124)[14](#i981a22c87c7d4319aa4bec2f94174cb0_124)] | | |

| Consolidated Statements of Comprehensive Income: Years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018] [added: 2019] | | | [removed: [F-](#i9e78b49d3c5c42cfa6fb60b4d7c56701_133)[15](#i9e78b49d3c5c42cfa6fb60b4d7c56701_133)] [added: [F-](#i981a22c87c7d4319aa4bec2f94174cb0_127)[15](#i981a22c87c7d4319aa4bec2f94174cb0_127)] | | |

| Consolidated Statements of Capital: Years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018] [added: 2019] | | | [removed: [F-](#i9e78b49d3c5c42cfa6fb60b4d7c56701_136)[16](#i9e78b49d3c5c42cfa6fb60b4d7c56701_136)] [added: [F-](#i981a22c87c7d4319aa4bec2f94174cb0_130)[16](#i981a22c87c7d4319aa4bec2f94174cb0_130)] | | |

| Consolidated Statements of Cash Flows: Years ended December 31, [added: 2021,] 2020, [removed: 2019,] and [removed: 2018] [added: 2019] | | | [removed: [F-](#i9e78b49d3c5c42cfa6fb60b4d7c56701_142)[18](#i9e78b49d3c5c42cfa6fb60b4d7c56701_142)] [added: [F-](#i981a22c87c7d4319aa4bec2f94174cb0_133)[18](#i981a22c87c7d4319aa4bec2f94174cb0_133)] | | |

| (3) Financial Statement Schedule – Schedule III – Real Estate and Accumulated Depreciation as of December 31, [removed: 2020] [added: 2021] | | | [removed: [F-](#i9e78b49d3c5c42cfa6fb60b4d7c56701_241)[58](#i9e78b49d3c5c42cfa6fb60b4d7c56701_241)] [added: [F-](#i981a22c87c7d4319aa4bec2f94174cb0_202)[58](#i981a22c87c7d4319aa4bec2f94174cb0_202)] | | |

| Notes to Consolidated Financial Statements | | | [F-](#i981a22c87c7d4319aa4bec2f94174cb0_136)[20](#i981a22c87c7d4319aa4bec2f94174cb0_136) | | |

*[Table [removed: of Contents](#i9e78b49d3c5c42cfa6fb60b4d7c56701_10)*][added: of](#i981a22c87c7d4319aa4bec2f94174cb0_10) [Contents](#i981a22c87c7d4319aa4bec2f94174cb0_10)*]

We have audited the accompanying consolidated balance sheets of Essex Property Trust, Inc. and subsidiaries (the Company) as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] the related consolidated statements of income, comprehensive income, equity, and cash flows for each of the years in the [removed: three‑year] [added: three-year] period ended December 31, [removed: 2020,] [added: 2021,] and the related notes and financial statement schedule III (collectively, the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] and the results of its operations and its cash flows for each of the years in the [removed: three‑year] [added: three-year] period ended December 31, [removed: 2020,] [added: 2021,] in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in [removed: Internal] [added: *Internal] Control – Integrated Framework [removed: (2013)] [added: (2013)*] issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February [removed: 19, 2021] [added: 25, 2022] expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

*Critical Audit [removed: Matters*][added: Matter*]

The critical audit [removed: matters] [added: matter] communicated below [removed: are matters] [added: is a matter] arising from the current period audit of the consolidated financial statements that [removed: were] [added: was] communicated or required to be communicated to the audit committee and that: (1) [removed: relate] [added: relates] to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of [added: a] critical audit [removed: matters] [added: matter] does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit [removed: matters] [added: matter] below, providing [added: a] separate [removed: opinions] [added: opinion] on the critical audit [removed: matters] [added: matter] or on the accounts or disclosures to which [removed: they relate.][added: it relates.]

The Company had [removed: $10.9] [added: $11.0] billion in rental properties as of December 31, [removed: 2020.][added: 2021.]

We evaluated the design and tested the operating effectiveness of certain internal controls over the Company’s process to evaluate events or [removed: changes in circumstances that would indicate rental properties may be impaired.]

[removed: In addition, we observed the property conditions at certain rental property sites and inquired of property management personnel regarding] events or changes in circumstances that [added: would] indicate [removed: the] rental properties may be impaired.

We evaluated the design and tested the operating effectiveness of certain internal controls over the [removed: Company’s land and building value estimation] [added: Operating Partnership’s] process [removed: in asset acquisitions.][added: to evaluate]

We have audited Essex Property Trust, Inc. and [removed: subsidiaries’] [added: subsidiaries'] (the Company) internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in *Internal Control – Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission.

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in *Internal Control – Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] the related consolidated statements of income, comprehensive income, equity, and cash flows for each of the years in the three-year period ended December 31, [removed: 2020,] [added: 2021,] and the related notes and financial statement schedule III (collectively, the consolidated financial statements), and our report dated February [removed: 19, 2021] [added: 25, 2022] expressed an unqualified opinion on those consolidated financial statements.

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying [removed: *Management’s] [added: Management's] Report on Internal Control Over Financial [removed: Reporting*.][added: Reporting.]

We have audited the accompanying consolidated balance sheets of Essex Portfolio, L.P. and subsidiaries (the Operating Partnership) as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] the related consolidated statements of income, comprehensive income, capital, and cash flows for each of the years in the [removed: three‑year] [added: three-year] period ended December 31, [removed: 2020,] [added: 2021,] and the related notes and financial statement schedule III (collectively, the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Operating Partnership as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] and the results of its operations and its cash flows for each of the years in the [removed: three‑year] [added: three-year] period ended December 31, [removed: 2020,] [added: 2021,] in conformity with U.S. generally accepted accounting principles.