Essex Property Trust (ESS) 10-K risk factor changes: FY2023 vs FY2022

- changes in the general or local economic climate [removed: and] [added: that could affect] demand for housing, including layoffs, [removed: industry slowdowns, relocations] [added: due to an increase in the use] of [removed: employees from local employers, changing demographics, increased worker locational flexibility,] [added: new technologies to replace workers, slowing job growth,] and other events negatively impacting local employment rates, wages and the local economy;

- [removed: changing] [added: changes in] economic conditions, such as high inflationary periods in which our operating and financing costs may increase at a rate greater than our ability to increase rents, or deflationary periods where rents may decline more quickly relative to operating and financing costs; 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. If the Company is unable to promptly renew or re-let [removed: in place] [added: existing] leases, 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.

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

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[added: The future outbreak of contagious diseases could materially affect our business, financial condition, and results of operations.] If there is a future outbreak of [removed: COVID-19 or other] contagious diseases, [added: such as COVID-19,] the Company may [removed: again] be subject to eviction [removed: moratoria,] [added: moratoria or] limits on rent increases and collection efforts, or may be legally required to or otherwise agree to restructure tenants’ rent obligations [removed: and may not be able to do so] on [removed: terms as] [added: less] favorable [removed: to us as] [added: terms than] those currently in place.

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

A new pandemic or disease outbreak may [added: also] cause increased costs, lower profitability and market fluctuations that may affect our ability to obtain necessary funds for our business or [added: may otherwise] negatively impact the ability of the Company’s third-party mezzanine loan borrowers and preferred equity investment sponsors to repay the Company.

[removed: However, acquisitions] [added: Acquisitions of communities involve various risks and uncertainties and] may fail to meet [added: expectations. The Company’s acquisition of apartment communities may fail to meet] the Company’s expectations due to factors including inaccurate estimates of future income, expenses and the costs of improvements or [removed: redevelopment.][added: redevelopment, which may be exacerbated by the lack of current market data due to limited deal flow.]

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

If the Company finances new acquisitions under existing lines of credit, there is a risk that, unless the Company obtains substitute financing, the Company may not be able to undertake additional borrowing for further acquisitions or developments or such borrowing may [removed: be] not [added: be] available on advantageous terms.

Development and redevelopment activities may be delayed, not completed, and/or not achieve expected results. The Company pursues development and redevelopment projects, [added: including densification projects] and those activities generally entail certain risks, including:

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, [added: refinance,] 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. 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.

In some instances, the Company and the joint venture partner may each have the right to [removed: trigger] [added: exercise] a buy-sell arrangement, which could cause the Company to sell its interest, or acquire a partner’s interest, at a time when the Company otherwise would not have initiated such a [removed: transaction.][added: transaction, and may result in the valuation of our interest or our partner’s interest at levels which may not be representative of the valuation that would result from an arm’s length marketing process and could cause us to recognize unanticipated capital gains or losses or the loss of fee income.]

In the event that such co-investment or the partners in such co-investment become insolvent or bankrupt or fail to develop or operate the property in the manner anticipated, [added: or are unable to refinance or sell their interest as planned,] the Operating Partnership may not receive the expected return in its expected timeframe or at all and may lose up to its entire investment.

However, there are types of losses, generally catastrophic in nature, such as losses due to wars, acts of terrorism, earthquakes, pollution, environmental matters or extreme weather conditions such as hurricanes, fires and floods that are uninsurable or not economically [removed: insurable, or may be insured subject to limitations, such as large deductibles.][added: insurable.]

Our properties or markets may in the future be the target of actual or threatened terrorist attacks, shootings, or other acts of violence, which could directly or indirectly damage our communities both physically and financially, cause [removed: losses that exceed our insurance coverage,] [added: uninsured losses,] adversely affect the value of and our ability to operate our communities, subject us to significant liability claims, or otherwise impair our ability to achieve our expected results.

Climate change may adversely affect our business. As a result of climate change, we may experience extreme weather, an increased number of natural disasters and changes in precipitation, temperature and wild fire and drought exposure, all of which may result in physical damage, a decrease in demand for our communities located in these areas or affected by these conditions, damage to our properties, disruption of services at our properties or increased costs associated with [added: water or energy use and] maintaining or insuring our communities.

Should the impact of climate change be material in nature or occur for lengthy periods of time, [added: even if not directly impacting] the [added: Company’s current markets, the] types and pricing of insurance the Company is able to procure may be negatively impacted and our financial condition or results of operations may be adversely affected.

In addition, changes in federal, state and local legislation and regulation on climate change could result in increased operating costs (for example, increased utility costs) and/or increased capital expenditures to improve the energy efficiency of our existing communities (for example, increased costs associated with meeting electric vehicle charging mandates) and could also require us to spend more on our new development communities without a corresponding increase in [removed: revenue and could increase our exposure to new physical risks and liabilities (for example, we may see an increase in fires caused by electric vehicle chargers).][added: revenue.]

Failure to succeed in new markets [added: or with new community operations formats] may limit the Company’s growth. The Company may make acquisitions or commence development activity outside of its existing market areas if appropriate opportunities arise, which may expose the Company to new risks, including, but 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 [added: a] lack of familiarity with local governmental and permitting procedures.

The Company’s real estate assets may be subject to impairment charges. The Company continually evaluates the recoverability of the carrying value of its real estate [added: assets, including those] assets [added: it invests in indirectly or places subordinated loans on through its preferred equity and mezzanine lending program,] under U.S. generally accepted accounting principles ("U.S. GAAP").

There can be no assurance that the Company will not take charges in the future related to the impairment of the Company’s [removed: assets.][added: assets, including those assets it invests in indirectly or places subordinated loans on through its preferred equity and mezzanine lending program.]

Real estate markets are highly uncertain and the value of undeveloped [added: land] may fluctuate significantly.

If there are [removed: subsequent] changes in the fair value of our land holdings which we determine is less that the carrying basis of our land holdings reflected in our financial statements plus estimated costs to sell, we may be required to take [removed: future] impairment [removed: changes] [added: charges] which could have a material adverse effect on our financial condition and results of operations.

[removed: We rely on information technology in our operations, and any] [added: Any failure by us to comply with applicable requirements or] material failure, inadequacy, interruption or breach of the Company’s privacy or information [removed: security] systems, or those of our vendors or other third parties, could materially adversely affect the Company’s [removed: business] [added: business, results of operations] and financial condition. We rely on information technology [added: hardware, software,] networks and systems [added: (collectively, “IT Systems”), some of which are provided by vendors,] to process, transmit and store [removed: electronic] [added: personal] information, [added: tenant] and [added: lease data, and other electronic information (collectively, “Confidential Information”), and] to manage or support a variety of business processes, including financial transactions and [removed: records, personally identifiable information (“PII”), and tenant and lease data.][added: records.]

Our business requires us and some of our vendors to use and store [removed: PII] [added: personal] and other sensitive information of our tenants and employees.

The [removed: collection and] [added: collection,] use [added: and other processing] of [removed: PII] [added: personal information] is governed by federal and state laws and regulations.

Privacy and [removed: information security] [added: cybersecurity] laws continue to [removed: evolve] [added: evolve, with several states passing new data privacy laws that govern the processing of information about state residents,] and [added: laws] may be inconsistent from one jurisdiction to another.

Compliance with [removed: all such] [added: existing and future] laws and regulations [added: related to data privacy and protection] may increase the Company’s operating costs and adversely impact the Company’s ability to market the Company’s properties and [removed: services.][added: services, and any failure to comply with such laws and regulations could harm our business, reputation and financial results.]

Although we have taken steps to abide by [added: applicable] privacy and [removed: security] [added: cybersecurity] laws, and [added: strive] to protect the security of our [removed: information systems and maintain confidential tenant, prospective tenant] [added: IT Systems] and [removed: employee information,] [added: Confidential Information,] the compliance and security measures put in place by the [removed: Company,] [added: Company] and [removed: such vendors,] [added: its vendors] cannot guarantee perfect compliance or provide absolute security, and the Company and [removed: our] [added: its] vendors' [removed: compliance systems and/or information technology infrastructure] [added: IT Systems] may be vulnerable to [removed: criminal] cyber-attacks or [removed: data security incidents, including ransom] [added: cybersecurity incidents that threaten the confidentiality, integrity and availability] of [added: our IT Systems and Confidential Information, including through ransomware distributed denial-of-service attempts,] data [removed: (such as, tenant and/or employee information), due to] [added: theft, account takeovers, social engineering/phishing, technological error,] employee error, malfeasance, [added: misconfigurations, “bugs”,] or other [removed: vulnerabilities.][added: vulnerabilities in Company, or vendor, IT Systems.]

Any [removed: such] incident could compromise the Company’s or [removed: such] [added: our] vendors’ [removed: networks] [added: IT Systems] (or the [removed: networks or systems] [added: IT Systems] of third parties that facilitate the Company’s or such vendors’ business activities), and the [removed: information] [added: Confidential Information] stored by [added: or on behalf of] the Company or such vendors could be accessed, misused, publicly disclosed, corrupted, lost, or stolen, resulting in fraud, including wire fraud related to Company [removed: assets,] [added: assets] or [added: tenant payments, or] other harm.

Moreover, if there is a compliance failure, or if a [removed: data security] [added: cybersecurity] incident [removed: or breach] affects the Company’s [removed: systems] or [removed: such] vendors’ systems, whether through a breach of the Company’s [removed: systems] [added: IT Systems] or a breach of the [removed: systems] [added: IT Systems] of third parties, or results in the unauthorized release of [removed: PII,] [added: Confidential Information,] the Company’s reputation and brand could be materially damaged, which could increase our costs in attracting and retaining tenants, and other serious consequences may result.

Potential other consequences include [removed: that the Company may be exposed] [added: potential exposure] to [removed: a risk of] litigation, including government enforcement actions, private litigation [added: (including class actions), fines] or criminal penalties; and [removed: that the Company may be exposed] [added: potential exposure] to a risk of loss including loss related to the fact that agreements with such vendors, or such vendors’ financial condition, may not allow the Company to recover all costs related to a [removed: cyber-breach] [added: cybersecurity incident] for which they alone or they and the Company should be jointly responsible for, which could result in a material adverse effect on the Company’s [added: business,] results of operations and financial condition.

Privacy and [removed: information security] [added: cybersecurity] risks have generally increased in recent years because of the proliferation of new technologies, such as [removed: ransomware,] [added: ransomware] and [added: generative AI, and] the increased [removed: sophistication] [added: sophistication, techniques] and activities of [removed: perpetrators of cyber-attacks.][added: threat actors; accordingly, the Company may be unable to anticipate these techniques or implement adequate preventative measures .]

In the future, the Company may expend additional resources to continue to enhance the Company’s [removed: information security] [added: cybersecurity] measures to investigate and remediate any [removed: information security] [added: cybersecurity] vulnerabilities and/or to further ensure compliance with privacy and [removed: information security] [added: cybersecurity] laws.

Despite these steps, the Company may suffer a significant [removed: data security] [added: cybersecurity] incident in the future, unauthorized parties may gain access to [removed: sensitive data] [added: Confidential Information] stored on the Company’s [removed: systems,] [added: or its vendors’ IT Systems,] and any such incident may not be discovered in a timely manner.

Any [added: cybersecurity incident or] failure in [added: the implementation, compliance with] or [removed: breach] [added: effectiveness] of the Company’s [removed: information security systems,] [added: IT Systems or cybersecurity program or] those of third party service providers, or a breach of other third party systems that ultimately impacts the operational or [removed: information security systems] [added: IT Systems] of the [removed: Company as a result of cyber-attacks or information security breaches] could result in a wide range of potentially serious harm to our business and results of operations.

Reliance on third party software providers to host systems [added: is] critical to our operations and to provide the Company with data. We rely on certain key software vendors to support business practices critical to our operations, including the collection of rent and ancillary income and communication with our tenants, and to provide us with [added: data, such as environmental, social and governance (“ESG”)] data.

Moreover, if any of these key vendors were to terminate our relationship or access to data, or [removed: to] fail, we could suffer losses while we [removed: sought] [added: seek] to replace the services and information provided by the vendors.

- changes in demand for rental housing due to a variety of factors, including relocations of employees from local employers, increased worker locational flexibility and changing demographics, which could lead to a relative decrease in the renting population as the domestic population skews older due to the aging of baby boomers and older people may be more likely to purchase, rather than rent, homes,

Additionally, the Company may be subject to temporary or permanent legislative restrictions that may inhibit our ability to conduct normal business activities including timely repairs, maintenance and customer service

- we are reliant on third party contractors’ and vendors’ ability to deliver services and products as planned, and if the timeframe, quality or scope of such services and products are different than we expected, our projects may be subject to increased costs and our future income may be lower than expected;

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Additionally, the political climates in California and Washington, in combination with the states’ and certain local governments’ relatively long suspension of rent payments and the corresponding restriction on evicting tenants due to non-payment of rent in connection with the COVID-19 pandemic, may have shifted some residents’ attitudes about the necessity of making rent payments.

This shift could reduce some residents’ willingness to pay rent and therefore the Company may continue to experience higher than historical average delinquency rates, which could adversely impact the Company’s financial condition and results of operations.

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Transition risks associated with climate change may result in interruptions in energy access, increased energy costs, or increased regulatory requirements and stakeholder expectations regarding reporting and energy efficiency.

Further, we may not have the ability to respond immediately to a major event, which may cause increased losses.

Additionally, we have recently adjusted our operating model to reduce the number of staff on-site at individual properties and moved towards a hub model where specialized staff can service multiple properties from a central location and rely on certain technologies, such as virtual apartment tours, to further reduce the need for on-site staffing.

There may be resistance to such change from our employees and residents, and if we experience difficulty in retaining and/or hiring employees or residents, as applicable, this could adversely affect the Company’s results of operations.

Further, there are unknown risks with relying on new technologies and operating models, such as whether there is consumer preference for in-person tours or if we are not able to as rapidly respond to resident demands, and we cannot guarantee that this model will be successful, which could adversely affect our results of operations.

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

We are subject to laws and regulations relating to the handling of personal information and we rely on information technology to sustain our operations.

The Company endeavors to comply with privacy laws and regulations applicable to it, including the California Consumer Privacy Act (“CCPA”) which governs the collection, use, disclosure and security of information about California residents.

The CCPA requires the Company to, among other things, provide certain disclosures to California residents, promptly respond to certain consumer requests related to their data, and contractually impose certain obligations on vendors.

These threats can also come from diverse threat actors, such as state-sponsored organizations, opportunistic hackers and hacktivists.

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

We maintain cyber risk insurance which may be insufficient type or amount to cover us against claims related to a cybersecurity incident, and we cannot be certain that such insurance will continue to be available to us on economically reasonable terms, or at all, or that any insurer will not deny coverage as to any future claims.

Further, our failure, or our software vendors’ failure, to adopt, anticipate or keep pace with the new technologies, such as generative AI solutions, may harm our ability to compete with our peers, decrease the value of our assets and/or impact our future growth.

In late 2022 and early 2023, a number of purported anti-trust class actions were filed against RealPage, Inc., a seller of revenue management software, and various lessors of multifamily housing which utilize this software, including the Company.

The complaints allege collusion among defendants to artificially increase rents of multifamily residential real estate above competitive levels.

The Company intends to vigorously defend against these lawsuits.

Given their early stage, the Company is unable to predict the outcome or estimate the amount of loss, if any, that may result from such matters.

The Company is also subject to various other legal and/or regulatory proceedings arising in the normal course of its business operations, including California private attorney general actions (“PAGA Claims”).

The current political climate in California may continue to encourage plaintiffs’ attorneys to bring PAGA Claims and other class actions.

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

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Our ability to timely deliver quality customer service or to respond to building repair and maintenance requests may be negatively impacted without adequate operational staff, which may adversely impact the results of operations.

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If we do not acquire new assets, we may not have sufficient depreciation expense to offset income and may have to make special distributions to stockholders.

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If any of the Company’s subsidiary REITs were to fail to qualify as a REIT, then the subsidiary REIT would become subject to federal income tax.

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

Simultaneously, there are efforts by some stakeholders to reduce companies’ efforts on certain ESG-related matters, and certain states are adopting or are considering adopting laws that seek to limit the use of ESG in certain contexts.

In addition, both advocates and opponents to certain ESG matters are increasingly resorting to a range of activism forms, including media campaigns and litigation, to advance their perspectives.

To the extent we are subject to such activism or fragmented regulation with respect to ESG considerations, it may require us to incur costs or otherwise adversely impact our business.

The COVID-19 pandemic and the future outbreak of other contagious diseases could materially affect our business, financial condition, stock price, and results of operations. Uncertainty still surrounds the long-term impact of COVID-19.

Acquisitions of communities involve various risks and uncertainties and may fail to meet expectations. The Company intends to continue to acquire apartment communities.

Thus, we cannot assure you that an earthquake would not cause damage or losses greater than our current insured levels.

The Company endeavors to comply with all such laws and regulations, including by providing required disclosures, promptly responding to consumer requests for data, and seeking vendor compliance with applicable privacy and information security laws.

We maintain cyber risk insurance which may be insufficient in the event of a cyber-incident.

Further, the techniques used by criminals to obtain unauthorized access to sensitive data, such as phishing are increasing in sophistication and are often novel or change frequently; accordingly, the Company may be unable to anticipate these techniques or implement adequate preventative measures.

Certain state and local authorities may impose additional rental restrictions.

Uncertainty relating to the transition from LIBOR to SOFR may materially adversely affect us. The interest rate on certain of the Company’s debt obligations has been based on LIBOR, which is expected to be fully phased out by the end of June 2023.

As of December 31, 2022, the Company has transitioned its unsecured debt obligations and the majority of its secured debt obligations to SOFR, the consensus alternative rate to LIBOR.

While the transition to SOFR has not at this time caused any material impact to the Company’s debt costs, it is impossible to predict the extent to which SOFR will increase or decrease in the future, whether and to what extent banks will continue to use SOFR as the standard benchmark interest rate or if there will be any changes in the method used for determining SOFR which may result in a sudden or prolonged increase or decrease in SOFR.

If a published U.S. dollar SOFR rate is unavailable, the interest rates on certain of the Company’s debt obligations could change.

Any of these consequences could have a material adverse effect on our financing costs, and as a result, our financial condition and results of operations.

Accordingly, the Company could become more leveraged, resulting in an increased risk of default on its debt covenants or on its debt obligations and in an increase in debt service requirements.

Mr. Marcus is also the Chairman of and holds a controlling interest in, Marcus & Millichap, Inc., a national brokerage firm.

adversely affect the interests of holders of common stock.

Those provisions

If any of the Company’s subsidiary REITs were to fail to qualify as REITs, it is possible that the Company could also fail to qualify as a REIT.

The guarantee may take the form of a letter of credit, surety bond, guarantee agreement or other additional collateral.

Many of these factors are beyond the

Essex is the sole general partner of the Operating Partnership and, as of December 31, [removed: 2022,] [added: 2023,] had an approximately 96.6% general partner interest in the Operating Partnership.

As of December 31, [removed: 2022,] [added: 2023,] the Company owned or had ownership interests in 252 operating apartment communities, comprising [removed: 62,147] [added: 61,997] apartment homes, excluding the Company's ownership in preferred equity co-investments, loan investments, three operating commercial buildings, and a development pipeline comprised of one unconsolidated joint venture project.

As of December 31, [removed: 2022,] [added: 2023,] the Company’s development pipeline was comprised of one unconsolidated joint venture project under development aggregating 264 apartment homes and various predevelopment projects, with total incurred costs of [removed: $102.0] [added: $114.0] million.

The estimated remaining project costs are approximately [removed: $25.0] [added: $12.0] million, [removed: $12.8] [added: $6.5] million of which represents the Company's [added: share of the] estimated remaining costs, for total estimated project costs of [removed: $127.0] [added: $126.0] million.

As of December 31, [removed: 2022,] [added: 2023,] the Company also had an ownership interest in three operating commercial buildings (totaling approximately 283,000 square feet).

By region, the Company's operating results for [removed: 2022] [added: 2023] and [removed: 2021] [added: 2022] and projection for [removed: 2023] [added: 2024] 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 [removed: housing), projection for 2023 job growth,] [added: housing)] and [removed: 2023] [added: 2024] estimated Same-Property revenue growth are as follows:

Southern California Region: As of December 31, [removed: 2022,] [added: 2023,] this region represented 43% of the Company’s consolidated operating apartment homes.

Revenues for [removed: "2022] [added: "2023] Same-Properties" (as defined below), or "Same-Property revenues," increased [removed: 11.3%] [added: 4.9%] in [removed: 2022] [added: 2023] as compared to [removed: 2021.][added: 2022.]

In [removed: 2023,] [added: 2024,] the Company projects new residential supply of [removed: 30,300] [added: 27,400] apartment homes and single family homes, which represents [removed: 0.5%] [added: 0.4%] of the total housing stock.

Northern California Region: As of December 31, [removed: 2022,] [added: 2023,] this region represented 37% of the Company’s consolidated operating apartment homes.

Same-Property revenues increased [removed: 8.4%] [added: 4.0%] in [removed: 2022] [added: 2023] as compared to [removed: 2021.][added: 2022.]

In [removed: 2023,] [added: 2024,] the Company projects new residential supply of [removed: 12,750] [added: 10,500] apartment homes and single family homes, which represents [removed: 0.5%] [added: 0.4%] of the total housing stock.

Seattle Metro Region: As of December 31, [removed: 2022,] [added: 2023,] this region represented 20% of the Company’s consolidated operating apartment homes.

Same-Property revenues increased [removed: 12.0%] [added: 4.0%] in [removed: 2022] [added: 2023] as compared to [removed: 2021.][added: 2022.]

In [removed: 2023,] [added: 2024,] the Company projects new residential supply of [removed: 14,450] [added: 11,700] apartment homes and single family homes, which represents [removed: 1.1%] [added: 0.9%] of the total housing stock.

In total, the Company projects an increase in [removed: 2023] [added: 2024] Same-Property revenues of between [removed: 3.25%] [added: 0.7%] to [removed: 4.75%.][added: 2.7%.]

Same-Property operating expenses are projected to increase in [removed: 2023] [added: 2024] by [removed: 4.50%] [added: 3.5%] to [removed: 5.50%.][added: 5.0%.]

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| | | | December 31, [removed: 2022] [added: 2023] | | | | | | | | | | | | December 31, [removed: 2021] [added: 2022] | | | | | | | | |

| Southern California | | | [removed: 22,151] [added: 21,986] | | | | | | 43 | | % | | | | [removed: 22,190] [added: 22,151] | | | | | | 43 | | % |

| Northern California | | | [removed: 19,230] [added: 19,245] | | | | | | 37 | | % | | | | [removed: 19,123] [added: 19,230] | | | | | | 37 | | % |

| Total | | | [removed: 51,722] [added: 51,572] | | | | | | 100 | | % | | | | [removed: 51,654] [added: 51,722] | | | | | | 100 | | % |

[removed: While] [added: The Company is emerging from restrictions resulting from] the [removed: California eviction moratorium sunsetted during] [added: COVID-19 pandemic and continues to comply with] the [removed: third quarter] [added: stated intent] of [removed: 2021, other] [added: local, county,] state and [removed: local eviction moratoriums and laws that] [added: federal laws, some of which] limit rent increases during times of emergency and impair the ability to collect unpaid rent during certain timeframes [removed: continue to be in effect] [added: and] in various [removed: formats at various] regions in which our communities are located, impacting the Company and its properties.

Inflation has caused an increase in consumer prices, thereby reducing purchasing power and elevating the risks of a [added: recession.]

Due to increased inflation, the U.S. Federal Reserve raised the federal funds rate a total of seven times during [removed: 2022.][added: 2022 and four times in 2023.]

[removed: COVID-19 pandemic,] [added: The long-term impact of these developments will largely depend on] future laws that may be enacted, [removed: geopolitical tensions, inflation,] 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: 2022] [added: 2023] and [removed: 2021)] [added: 2022)] have generally remained higher than the pre-pandemic [removed: period due to on-going eviction moratoria related to the COVID-19 pandemic, and above the typical] historical [removed: range] [added: average] of [removed: 0.3% to 0.4%] [added: 0.35%] since the second quarter of 2020.

As of December 31, [removed: 2022,] [added: 2023,] the delinquencies have not had a material adverse impact to the Company's liquidity position.

The Company's average financial occupancy for the Company's Same-Property portfolio [removed: decreased] [added: increased] slightly from [removed: 96.4%] [added: 96.1%] for the year ended December 31, [removed: 2021] [added: 2022] to [removed: 96.1%] [added: 96.4%] for the year ended December 31, [removed: 2022.][added: 2023.]

The [removed: COVID-19 pandemic and the resulting] [added: foregoing] macroeconomic conditions have 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: 2022] [added: 2023] discussed in the “Liquidity and Capital Resources" section below.

The Company’s average financial occupancy for the Company’s stabilized apartment communities or [removed: "2022] [added: "2023] Same-Property" (stabilized properties consolidated by the Company for the years ended December 31, [removed: 2022] [added: 2023] and [removed: 2021) decreased] [added: 2022) increased] 30 [added: basis points to 96.4% in 2023 from 96.1% in 2022.]

The regional breakdown of the Company’s [removed: 2022] [added: 2023] Same-Property portfolio for financial occupancy for the years ended December 31, [removed: 2022] [added: 2023] and [removed: 2021] [added: 2022] is as follows:

| | | | [added: | | | 2023 | | | | | |] 2022 | | | | | | 2021 | | |

| Southern California | | | [removed: 96.2] [added: 96.3] | | % | | | | [removed: 96.7] [added: 96.2] | | % |

| Northern California | | | [removed: 96.1] [added: 96.5] | | % | | | | [removed: 96.2] [added: 96.1] | | % |

| Seattle Metro | | | [removed: 95.8] [added: 96.6] | | % | | | | [removed: 96.2] [added: 95.8] | | % |

The following table provides a breakdown of revenue amounts, including the revenues attributable to [removed: 2022] [added: 2023] Same-Properties.

| Property Revenues ($ in thousands) | | | | | | Homes | | | | | | [removed: 2022] [added: 2023] | | | | | | [removed: 2021] [added: 2022] | | | | | | Change | | | | | | Change | | |

| [removed: 2022] [added: 2023] Same-Properties: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

[removed: *2022] [added: *2023] Same-Property Revenues* increased by [removed: $138.3] [added: $66.4] million or [removed: 10.3%] [added: 4.4%] to [removed: $1.5] [added: $1.6] billion for [removed: 2022] [added: 2023] compared to [removed: $1.3] [added: $1.5] billion in [removed: 2021.][added: 2022.]

Market Considerations

Concurrently, geopolitical tensions and regional conflicts have increased uncertainty during 2022 and 2023.

Cash delinquencies were elevated at 1.3% for 2022 and further increased to 1.9% in 2023.

The lower cash delinquencies in 2022 was due to $34.5 million of Emergency Rental Assistance payments compared to $2.6 million received during 2023, however current tenant delinquencies remained well above pre-pandemic levels.

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

| | | | 2023 | | | | | | 2022 | | |

| Southern California | | | | | | 21,352 | | | | | | $ | 666,062 | | | | | $ | 634,996 | | | | | $ | 31,066 | | | | | 4.9 | | % |

| Northern California | | | | | | 18,371 | | | | | | 633,736 | | | | | | 609,261 | | | | | | 24,475 | | | | | | 4.0 | | % |

| Seattle Metro | | | | | | 10,341 | | | | | | 282,092 | | | | | | 271,248 | | | | | | 10,844 | | | | | | 4.0 | | % |

| Total 2023 Same-Property Revenues | | | | | | 50,064 | | | | | | 1,581,890 | | | | | | 1,515,505 | | | | | | 66,385 | | | | | | 4.4 | | % |

| 2023 Non-Same Property Revenues | | | | | | | | | | | | 76,374 | | | | | | 80,170 | | | | | | (3,796) | | | | | | (4.7) | | % |

| Total Property Revenues | | | | | | | | | | | | $ | 1,658,264 | | | | | $ | 1,595,675 | | | | | $ | 62,589 | | | | | 3.9 | | % |

*2023 Non-Same Property Revenues* decreased by $3.8 million or 4.7% to $76.4 million in 2023 compared to $80.2 million in 2022.

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

and repairs expenses, $4.1 million in insurance and other expenses, $2.7 million in personnel costs, and $0.5 million in administrative expenses.

*Real estate taxes* increased by $1.9 million or 1.0% to $185.8 million in 2023 compared to $183.9 million in 2022, primarily due to an increase of approximately 2% in California real estate taxes, partially offset by a decrease from 2022 in real estate taxes in the Seattle metro region.

2023 Same-Property real estate taxes increased by $2.1 million or 1.3% to $171.3 million in 2023 compared to $169.2 million in 2022 primarily due to an increase of approximately 2% in California real estate taxes, partially offset by a decrease from 2022 in real estate taxes in the Seattle metro region.

The increase was partially offset by the sale of Anavia in 2022 and CBC and The Sweeps in 2023.

*Interest expense* increased by $8.1 million or 4.0% to $212.9 million in 2023 compared to $204.8 million in 2022*,* primarily due to borrowing on the $300.0 million unsecured term loan in April 2023, the $298.0 million of 10-year secured loans closed in July 2023, and higher average interest rates resulting in an increase in interest expense of $16.3 million.

*Interest and other (loss) income* increased by $65.3 million or 343.7% to income of $46.3 million in 2023 compared to a loss of $19.0 million in 2022, primarily due to increases of $55.6 million in realized and unrealized gains on marketable securities, $7.3 million in marketable securities and other income, and $3.7 million in insurance reimbursements, legal settlements, and other, driven by a legal settlement claim.

*Equity income from co-investments* decreased by $15.4 million or 59.2% to $10.6 million in 2023 compared to $26.0 million in 2022, primarily due to a decrease of $17.1 million in co-investment promote income, an increase of $31.6 million in impairment losses from unconsolidated co-investments offset by an increase of $39.7 million in equity income from non-core co-investments.

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

The underlying interest rate is based on a tiered rate structure tied to the Company's credit ratings, adjusted for the Company's sustainability metric grid, and was at Adjusted SOFR plus 0.75% as of December 31, 2023.

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

As of December 31, 2023, the Company's development pipeline was comprised of one unconsolidated joint venture project under development aggregating 264 apartment homes and various predevelopment projects, with total incurred costs of $114.0 million.

| Mezzanine loans | | | | | | 1 | | | | | | 50,000 | | | | | | 4,305 | | |

| | | | | | | | | | | | | $ | 234,000 | | | | | $ | 80,020 | |

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

| Casualty loss | | | | | | 433 | | | | | | — | | | | | | — | | |

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

| Casualty Loss | | | 433 | | | | | | — | | | | | | — | | |

| Same-Property NOI | | | $ | 1,118,606 | | | | | $ | 1,072,348 | | | | | $ | 941,033 | |

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

The Company projects an increase of 2,000 jobs or 0.3% in the Southern California region.

The Company projects an increase of 4,500 jobs or 0.7% in the Northern California region.

The Company projects an increase of 3,000 jobs or 0.4% in the Seattle Metro region.

Market Considerations, including the COVID-19 Pandemic

Though diminishing, the COVID-19 pandemic and its related variants continue to impact the U.S. and world economies.

In an effort to mitigate its impact on affected populations, federal, state and local jurisdictions implemented varying forms of requirements which may continue to negatively affect profitability.

The Company continues to work to comply with the stated intent of local, county, state and federal laws.

While COVID-19’s impact begins to dissipate, geopolitical tensions between Russian and Ukraine increased uncertainty during

2022.

recession.

At the same time, the labor market remains historically tight and companies continue to look to add employees, pushing unemployment lower.

The long-term impact of these developments will largely depend on new information which may emerge concerning the

Cash delinquencies remained elevated at 1.9% for 2021 but decreased to 1.2% in 2022, attributable to government payments for Emergency Rental Assistance which was mostly depleted by December 31, 2022.

basis points to 96.1% in 2022 from 96.4% in 2021.

| Southern California | | | | | | 21,006 | | | | | | $ | 624,907 | | | | | $ | 561,326 | | | | | $ | 63,581 | | | | | 11.3 | | % |

| Northern California | | | | | | 17,895 | | | | | | 591,556 | | | | | | 545,535 | | | | | | 46,021 | | | | | | 8.4 | | % |

| Seattle Metro | | | | | | 10,218 | | | | | | 268,512 | | | | | | 239,819 | | | | | | 28,693 | | | | | | 12.0 | | % |

| Total 2022 Same-Property Revenues | | | | | | 49,119 | | | | | | 1,484,975 | | | | | | 1,346,680 | | | | | | 138,295 | | | | | | 10.3 | | % |

| 2022 Non-Same Property Revenues | | | | | | | | | | | | 110,700 | | | | | | 84,738 | | | | | | 25,962 | | | | | | 30.6 | | % |

| Total Property Revenues | | | | | | | | | | | | $ | 1,595,675 | | | | | $ | 1,431,418 | | | | | $ | 164,257 | | | | | 11.5 | | % |

*2022 Non-Same Property Revenues* increased by $26.0 million or 30.6% to $110.7 million in 2022 compared to $84.7 million in 2021.

The increase was primarily due to the addition of Martha Lake Apartments, Monterra in Mill Creek, The Rexford, and Silver communities to the Company's joint venture portfolio in 2021 and Vela in 2022, partially offset by the Company's purchases of BEX III, LLC's 50.0% interest in The Village at Toluca Lake in 2021, and its joint venture partner's 49.8% interest in Essex JV LLC co-investment that owned Regency Palm Court and Windsor Court, in 2022.

*Real estate taxes* increased by $3.5 million or 1.9% to $183.9 million in 2022 compared to $180.4 million in 2021, primarily due to real estate taxes from the completion of development properties Wallace on Sunset in 2021 and Station Park Green (Phase IV) in 2022, as well as the acquisitions of The Village at Toluca Lake, Canvas, and 7 S Linden Commercial properties during 2021.

2022 Same-Property real estate taxes increased by $0.3 million or 0.2% to $164.0 million in 2022 compared to $163.7 million in 2021 primarily due to increased valuations and tax rates.

*Corporate-level property management expenses* increased by $4.5 million or 12.4% to $40.7 million in 2022 compared to $36.2 million in 2021 due to costs pertaining to the centralization of certain property level functions.

The Company's $143.0 million gain on sale of real estate and land in 2021 was attributable to the sale of Hidden Valley, Axis 2300, Park 20, and Devonshire Apartments during 2021.

*Interest expense* increased by $1.7 million or 0.8% to $204.8 million in 2022 compared to $203.1 million in 2021*,* primarily due to the issuance of new senior unsecured notes in 2021 which resulted in an increase in interest expense of $4.8 million and increased borrowing on the Company's unsecured lines of credit, and higher average interest rates, which resulted in an increase in interest expense of $3.0 million.

*Total return swap income* of $7.9 million in 2022 consists of monthly settlements related to the Company's four total return swap contracts with an aggregate notional amount of $223.6 million.

*Interest and other (loss) income* decreased by $117.7 million or 119.3% to a loss of $19.0 million in 2022 compared to an income of $98.7 million in 2021, primarily due to unrealized losses resulting from a decrease in the fair value of marketable securities.

*Equity income from co-investments* decreased by $85.7 million or 76.7% to $26.0 million in 2022 compared to $111.7 million in 2021, primarily due to decreases of $93.6 million in equity income from non-core co-investments, $5.3 million in income from preferred equity investments including income from early redemptions, and a $2.1 million impairment loss from an unconsolidated co-investment.

These decreases were offset by $17.1 million in co-investment promote income during 2022 and an increase of $1.0 million in loss on early retirement of debt from unconsolidated co-investments.

*Deferred tax benefit on unconsolidated co-investments* of $10.2 million in 2022 is primarily due to net unrealized losses from non-core unconsolidated co-investments.

*Gain on remeasurement of co-investment* of $17.4 million in 2022 resulted from the Company's purchase of its joint venture partner's 49.8% membership interest in Essex JV, LLC co-investment that owned Regency Palm Court and Windsor Court.

Gain on remeasurement 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.

The use of a forward sale agreement would allow the Company to

| Mezzanine loans | | | | | | 2 | | | | | | 82,110 | | | | | | 60,932 | | |

| | | | | | | | | | | | | $ | 267,110 | | | | | $ | 149,052 | |

The allocation of the value between land and

building was a critical accounting estimate during the year ended December 31, 2020 as result of the potential material impact of the Company's acquisition of a land parcel and six communities for a total purchase price of $463.4 million.

estate, as an asset class, generally appreciates over time and depreciation charges required by U.S. GAAP do not reflect the underlying economic realities.

As of December 31, [removed: 2022,] [added: 2023,] the Company had one interest rate swap contract to mitigate the risk of changes in the interest-related cash outflows on $300.0 million of the unsecured term [removed: loan that had not been drawn and had a balance of zero.][added: loan.]

As of December 31, [removed: 2022,] [added: 2023,] the Company also had [removed: $223.6] [added: $222.7] million of secured variable rate indebtedness.

The Company’s interest rate swap [removed: is] [added: was] designated as a cash flow hedge as of December 31, [removed: 2022.][added: 2023.]

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, [removed: 2022.][added: 2023.]

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, [removed: 2022.][added: 2023.]

| Interest rate swaps | | | $ | 300,000 | | | | | 2026 | | | | | | $ | [removed: 5,556] [added: 4,274] | | | | | $ | [removed: 10,107] [added: 7,961] | | | | | $ | [removed: 851] [added: 502] | |

| Total cash flow hedges | | | $ | 300,000 | | | | | 2026 | | | | | | $ | [removed: 5,556] [added: 4,274] | | | | | $ | [removed: 10,107] [added: 7,961] | | | | | $ | [removed: 851] [added: 502] | |

Additionally, the Company has entered into total return swap contracts, with an aggregate notional amount of [removed: $223.6] [added: $222.7] million that effectively convert [removed: $223.6] [added: $222.7] million of fixed mortgage notes payable to a floating interest rate based on the SIFMA plus a spread and have a carrying value of zero at December 31, [removed: 2022.][added: 2023.]

The Company is exposed to insignificant interest rate risk on these [added: total return] swaps as the related mortgages are callable, at par, by the Company, co-terminus with the termination of any related swap.

*[Table of [removed: Contents](#i973047f3d5504a24aed3e92d095cd667_10)*][added: Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*]

Management has estimated the fair value of the Company’s $5.7 billion of fixed rate debt at December 31, [removed: 2022,] [added: 2023,] to be [removed: $5.2] [added: $5.3] billion.

Management has estimated the fair value of the Company’s [removed: $275.7] [added: $522.7] million of variable rate debt at December 31, [removed: 2022,] [added: 2023,] to be [removed: $273.2] [added: $519.0] 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: 2023] [added: 2024] | | | | | | [removed: 2024] [added: 2025] | | | | | | [removed: 2025] [added: 2026] | | | | | | [removed: 2026] [added: 2027] | | | | | | [removed: 2027] [added: 2028] | | | | | | Thereafter | | | Total | | | | | | Fair value | | |

| Fixed rate debt | | | $ | [removed: 302,093] [added: 402,177] | | | | | $ | [removed: 402,177] [added: 632,035] | | | | | $ | [removed: 632,035] [added: 548,291] | | | | | $ | [removed: 548,291] [added: 419,558] | | | | | $ | [removed: 419,558] [added: 517,000] | | | | | $ | [removed: 3,417,000] [added: 3,198,000] | | $ | [removed: 5,721,154] [added: 5,717,061] | | | | | $ | [removed: 5,195,981] [added: 5,299,805] | |

| Average interest rate | | | [removed: 3.4] [added: 4.0] | | % | | | | [removed: 4.0] [added: 3.5] | | % | | | | 3.5 | | % | | | | [removed: 3.5] [added: 3.8] | | % | | | | [removed: 3.8] [added: 2.2] | | % | | | | [removed: 3.0] [added: 3.3] | | % | | | | | | | | | |

[removed: (1)$223.6] [added: (1)$222.7] million of variable rate debt is tax exempt to the note holders.

[removed: The table incorporates only those exposures that exist as of December 31, 2022; it] [added: It] does not consider those exposures or positions that could arise after that date.

| Variable rate debt (1) | | | $ | 932 | | | | | $ | 1,019 | | | | | $ | 1,114 | | | | | $ | 384,397 | | | | | $ | 1,332 | | | | | $ | 133,937 | | $ | 522,731 | | | | | $ | 519,003 | |

| Average interest rate | | | 4.7 | | % | | | | 4.7 | | % | | | | 4.7 | | % | | | | 4.2 | | % | | | | 4.7 | | % | | | | 4.6 | | % | | | | | | | | | |

The table incorporates only those exposures that exist as of December 31, 2023.

| Variable rate debt (1) | | | $ | 852 | | | | | $ | 13,005 | | | | | $ | 1,019 | | | | | $ | 1,114 | | | | | $ | 84,397 | | | | | $ | 175,269 | | $ | 275,656 | | | | | $ | 273,160 | |

| Average interest rate | | | 3.6 | | % | | | | 4.3 | | % | | | | 3.6 | | % | | | | 3.6 | | % | | | | 3.4 | | % | | | | 3.7 | | % | | | | | | | | | |

Essex is the sole general partner of the Operating Partnership and as of December 31, [removed: 2022,] [added: 2023,] had an approximately 96.6% general partner interest in the Operating Partnership.

As of December 31, [removed: 2022,] [added: 2023,] the Company owned or had ownership interests in 252 operating apartment communities, aggregating [removed: 62,147] [added: 61,997] apartment homes, excluding the Company's ownership in preferred equity co-investments, loan investments, three operating commercial buildings, and a development pipeline comprised of one unconsolidated joint venture project and various predevelopment projects aggregating 264 apartment homes (collectively, the "Portfolio").

*[Table of [removed: Contents](#i973047f3d5504a24aed3e92d095cd667_10)*][added: Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*]

The table below summarizes acquisition activity for the year ended December 31, [removed: 2022] [added: 2023] ($ in millions):

| [removed: Property Name] [added: Property Name] | | | | | | [removed: Location] [added: Location] | | | | | | [removed: Apartment Homes] [added: Apartment Homes] | | | | | | [removed: Essex] [added: Essex] Ownership [removed: Percentage] [added: Percentage] | | | | | | [removed: Ownership] [added: Ownership] | | | | | | [removed: Quarter] [added: Quarter] in [removed: 2022 | | |] [added: 2023] | | | [removed: Purchase Price] | | | [added: Purchase Price] | | |

| [removed: Property Name] [added: Property Name (1)] | | | | | | [removed: Location] [added: Location] | | | | | | [removed: Apartment Homes] [added: Apartment Homes] | | | | | | [removed: Ownership] [added: Ownership] | | | | | | [removed: Quarter] [added: Quarter] in [removed: 2022] [added: 2023] | | | | | | [removed: Sales Price (in millions)] [added: Sales Price] | | | | | |

[removed: (1)] [added: (2)] The Company recognized a [removed: $94.4] [added: $54.5] million gain on sale.

As of December 31, [removed: 2022,] [added: 2023,] the Company's development pipeline was comprised of one unconsolidated joint venture project under development aggregating 264 apartment homes and various predevelopment projects, with total incurred costs of [removed: $102.0] [added: $114.0] million.

The estimated remaining project costs are approximately [removed: $25.0] [added: $12.0] million, of which [removed: $12.8] [added: $6.5] million represents the Company's share of estimated remaining costs, for total estimated project costs of [removed: $127.0] [added: $126.0] million.

As of December 31, [removed: 2022,] [added: 2023,] the Company had various consolidated predevelopment projects.

The Company may also acquire land for future development [removed: purposes or sale.][added: purposes.]

| LIVIA [removed: (fka] [added: at] Scripps [removed: Mesa Apartments)] [added: Ranch] (2) | | | | | | San Diego, CA | | | | | | 51% | | | | | | 264 | | | | | | $ | [removed: 77] [added: 90] | | | | | $ | 102 | |

| Total Development Projects - Joint Venture | | | | | | | | | | | | | | | | | | 264 | | | | | | [removed: 77] [added: 90] | | | | | | 102 | | |

| Other Projects | | | | | | Various | | | | | | 100% | | | | | | — | | | | | | [removed: 25] [added: 24] | | | | | | [removed: 25] [added: 24] | | |

| Total - Consolidated Predevelopment Projects | | | | | | | | | | | | | | | | | | — | | | | | | [removed: 25] [added: 24] | | | | | | [removed: 25] [added: 24] | | |

| Grand Total - Development and Predevelopment Pipeline | | | | | | | | | | | | | | | | | | 264 | | | | | | $ | [removed: 102] [added: 114] | | | | | $ | [removed: 127] [added: 126] | |

During [removed: 2022,] [added: 2023,] the Company made regularly scheduled principal payments [removed: and loan payoffs] of [removed: $43.2] [added: $2.9] million to its secured mortgage notes payable at an average interest rate of [removed: 3.6%.][added: 3.7%.]

As of December 31, [removed: 2022,] [added: 2023,] 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: 2022,] [added: 2023,] 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 Adjusted [removed: SOFR] [added: Secured Overnight Financing Rate ("Adjusted SOFR")] plus 0.75% which is based on a tiered rate structure tied to the Company's credit ratings, adjusted for the Company's sustainability metric grid, and a scheduled maturity date of January 2027 with two six-month extensions, exercisable at the Company's option.

[added: The Company's $35.0 million working capital unsecured line of] credit had an interest rate of Adjusted SOFR plus 0.75%, which is based on a tiered rate structure tied to the Company's credit ratings, adjusted for the Company's sustainability metric grid, and a scheduled maturity date of July 2024.

During the year ended December 31, [removed: 2022,] [added: 2023,] the Company did not issue any shares of common stock through its equity distribution agreement entered into in September 2021 (the "2021 ATM Program").

As of December 31, [removed: 2022,] [added: 2023,] there were no outstanding forward sale agreements, and $900.0 million of shares remain available to be sold under the 2021 ATM Program.

During the year ended December 31, [removed: 2022,] [added: 2023,] the Company repurchased and retired [removed: 740,053] [added: 437,026] shares of its common stock totaling [removed: $189.7] [added: $95.7] million, including [removed: commissions, of which 420,606 shares of common stock totaling $101.7 million were repurchased under the new plan after its approval.][added: commissions.]

As of December 31, [removed: 2022,] [added: 2023,] the Company had [removed: $398.3] [added: $302.7] million of purchase authority remaining under its $500.0 million stock repurchase plan.

As of December 31, [removed: 2022,] [added: 2023,] the Company had [removed: 1,772] [added: 1,750] employees, [removed: 99.9%] [added: 99.8%] of whom were full-time employees.

A total of [removed: 1,327] [added: 1,321] employees worked on-site at our operating communities and [removed: 445] [added: 429] worked in our corporate offices.

The Company believes it has one of the most diverse workforces among its peers in the real estate industry in part due to its robust and integrated diversity, equity, and inclusion strategy, which [removed: utilizes training programs, employee committees, and executive sponsorships] [added: allows the Company] to [removed: strengthen] [added: broaden its perspective] and [removed: promote diversity, equal opportunity,] [added: better serve both the communities it operates in] and [removed: fair treatment for all Company associates.][added: the associates it employs.]

[removed: As of December 31, 2022, the] [added: –The] Company’s workforce [removed: was 41% female, 58% male,] [added: self-identified as 42% female] and [removed: 1%] [added: 57% male (1%] chose not to disclose their [removed: gender.][added: gender).]

The Company supports the employee-led affinity groups, [added: including] Women at Essex and the LGBTQ+ focused Rainbow Alliance, which foster a sense of community and inclusion for a diverse mix of associates at the Company through discussions and activities that are intended to engage, educate, enable, and empower the Company's employees.

All [added: Company] associates are offered training aimed at preventing workplace harassment, including harassment based on age, gender or ethnicity, training covering the foundations of DEI and awareness of unconscious bias in the workplace, and all managers are required to complete anti-harassment training.

The Company values leadership at every level and [removed: demonstrates such value with respect to its associates] [added: enables the same] by providing opportunities for all associates to develop personal and professional skills [removed: and by offering] [added: through] programs [removed: to] [added: that] encourage [removed: employee] [added: associate] retention and advancement.

[removed: Additionally, the] [added: The] Company [added: also] provides its associates with [removed: outside educational benefits by offering] an annual $3,000 tuition reimbursement to further support [added: outside] professional [removed: growth.][added: growth opportunities.]

To identify, retain and reward top performers, the Company [added: engages in meaningful internal succession planning and] offers a tenure program, [removed: which involves a cash gift for every five years of service, as well as] excellence [removed: awards] [added: awards,] and a spot bonus recognition program to reward associates for good teamwork, good [removed: ideas] [added: ideas,] and good service.

The Company encourages internal promotions and hiring for open [removed: positions.][added: positions, and the executive team actively mentors the Company’s top talent to ensure strong leadership at the Company for the future.]

*Employee [removed: Well-Being] [added: Health, Safety] and [removed: Safety*][added: Wellness*]

The [removed: Company's compensation and benefits] [added: Company’s total rewards] program [removed: and safety practices] further [removed: reinforce] [added: reinforces] its commitment to investing in the well-being of its associates while incentivizing its employees to promote fulfillment of the Company’s mission.

[removed: The] [added: Beyond competitive compensation, the] Company offers [removed: competitive compensation and] a [removed: standard] suite of benefits, including health insurance, a retirement plan with a $6,000 annual matching potential benefit, life and disability coverage, [added: supplemental] paid parental leave, and [removed: commuter benefits.][added: the robust health and wellness support programs noted above.]

Additionally, the Company offers [removed: a housing discount for associates that live at Company communities, and additionally offers] retirement support, associate discount programs, [removed: mental health support, including] a mental health [removed: program] [added: program, which includes counseling] and [added: coaching sessions for mental well-being support at no cost, and] refresh days for our operations teams, and health benefit credits for participation in wellness programs.

Providing a safe working environment and promoting employee safety is imperative to the Company, and the Company continued to prioritize its associates’ health and safety throughout [removed: 2022.][added: 2023.]

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

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| Hacienda at Camarillo Oaks | | | | | | Camarillo, CA | | | | | | 73 | | | | | | 100 | | % | | | | EPLP | | | | | | Q2 | | | | | | $ | 23.1 | |

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

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

| Total 2023 | | | | | | | | | | | | 73 | | | | | | | | | | | | | | | | | | | | | | | | $ | 23.1 | |

The table below summarizes disposition activity for the year ended December 31, 2023 ($ in millions):

| CBC and The Sweeps | | | | | | Goleta, CA | | | | | | 239 | | | | | | EPLP | | | | | | Q1 | | | | | | $ | 91.7 | | (2) | | |

| Total 2023 | | | | | | | | | | | | 239 | | | | | | | | | | | | | | | | | | $ | 91.7 | | | | |

(1) In March 2023, the Company sold a land parcel located in Moorpark, CA, that had been held for future development, for $8.7 million and recognized a gain on sale of $4.7 million.

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

| | | | | | | | | | | | | | | | | | | | | | | | | 12/31/2023 | | | | | | | | |

In July 2023, the Company closed $298.0 million in 10-year secured loans priced at 5.08% fixed interest rates encumbering four properties located in Northern California.

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

The DEI Committee’s goals for 2023 included increasing the Company’s training offerings, integrating DEI into talent recruitment processes, strengthening employee resource and affinity groups, making contributions to local DEI organizations, and improving recognition.

The Company’s notable diversity achievements for 2023 include the following data as of December 31, 2023:

–The Company’s workforce self-identified as 71% ethnically or culturally diverse.

–53% of the Company’s managerial level employees, including 38% of its senior executives, self-identified as ethnically or culturally diverse.

–There were 216 women in positions of manager or higher, equating to 61% of managerial positions in the Company.

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

– 60% of the Company’s corporate associates self-identified as female.

The charts below detail the Company’s diverse representation as of December 31, 2023:

Total Workforce


Executives & Management

*Ethnicity*


*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

*Gender*


The Company currently offers training courses to its associates via Workday Learning, and its associates spent 22,373 hours learning in 2023.

37% of the Company’s associates have approached or surpassed the Company’s average tenure of 6.35 years, with 21% reaching beyond 10 years of service.

In 2023, the Company promoted 13% of its employees to higher positions in the Company.

*Compensation and Benefits*

The Company offers competitive compensation to secure and retain top talent.

Alongside competitive pay, the Company is committed to pay equity and parity, and conducts a pay equity analysis on an annual basis which includes the development and use of a robust, multiple regression analysis model to confirm the Company’s continued achievement of gender pay parity.

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

Additionally, the Company offers an associate housing discount.

Goal setting, meaningful work, management support, DEI, and social well-being were recognized as the top 5 areas of strength for the organization.

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

Acquisitions are an important component of the Company’s business plan.

For the year ended December 31, 2022, the Company purchased or increased its interests in three communities consisting of 590 apartment homes for approximately $215.9 million.

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

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| Vela | | | | | | Woodland Hills, CA | | | | | | 379 | | | | | | 50 | | % | | | | Wesco VI | | | | | | Q1 | | | | | | $ | 183.0 | | (1) | | |

| Regency Palm Court and Windsor Court | | | | | | Los Angeles, CA | | | | | | 211 | | | | | | 100 | | % | | | | EPLP | | | | | | Q3 | | | | | | 32.9 | | | (2) | | |

| Total 2022 | | | | | | | | | | | | 590 | | | | | | | | | | | | | | | | | | | | | | | | $ | 215.9 | | | | |

(1) Represents the contract price for the entire property, not the Company’s share.

(2) In July 2022, the Company acquired its joint venture partner’s 49.8% minority interest in two apartment communities, consisting of 211 apartment homes located in Los Angeles, CA, for a contract price of $32.9 million.

For the year ended December 31, 2022, the Company sold one community consisting of 250 apartment homes for approximately $160.0 million.

| Anavia | | | | | | Anaheim, CA | | | | | | 250 | | | | | | EPLP | | | | | | Q4 | | | | | | $ | 160.0 | | (1) | | |

| Total 2022 | | | | | | | | | | | | 250 | | | | | | | | | | | | | | | | | | $ | 160.0 | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | 12/31/2022 | | | | | | | | |

In October 2022, the Company obtained a $300.0 million unsecured term loan priced at Adjusted Secured Overnight Financing Rate ("SOFR") plus 0.85%.

The loan has been swapped to an all-in fixed rate of 4.2% and matures in October 2024 with three 12-month extension options, exercisable at the Company's option.

The loan includes a six-month delayed draw feature with the proceeds expected to be drawn in April 2023 to repay the Company's $300.0 million unsecured notes due in May 2023.

The Company's $35.0 million working capital unsecured line of

The Company seeks to reinforce those values within its workforce.

As of December 31, 2022, the Company's workforce was, based on the voluntary self-identification of our employee base, approximately 45% Hispanic or Latino, 28% White, 12% Asian, 7% Black or African American, 1% Native Hawaiian or other Pacific Islander, 1% American Indian or Alaska Native, and 5% two or more races.

3% of employees chose to not disclose their race.

54% of the Company’s managerial level employees, 22% of its senior executives, and 20% of its named executive officers self-identified as Hispanic or Latino, Asian, Black or African American, Native Hawaiian or other Pacific Islander, American Indian or Alaska Native, or two or more races.

57% of our corporate associates and 36% of our on-site operational associates self-identified as female.

The Company had 249 women in positions of manager or higher, representing 60% of managerial positions, a decrease from 65% in 2021.

The slight decrease is primarily attributable to the Company’s new operational structure which resulted in 62 operational associates moving into non-managerial roles.

While some oversight duties were realigned, salary and benefits were not impacted, and women continue to hold a majority of the managerial roles at the Company.

Gender diversity within the Company’s leadership is similar to the overall gender diversity of the Company’s employees and managers, with women composing 60% of the Company’s executive officers and 56% of the Company’s senior executives.

The tables below detail the Company’s gender representation by position and the age diversity of its workforce.

The Company is committed to pay equity and conducts a pay equity analysis on an annual basis.

The Company developed a robust, multiple regression analysis model, which confirmed that we continue to maintain our gender pay parity.

Our robust statistical analysis confirmed that gender was not a significant factor in determining pay decisions in 2022.

The following aligns with the Company’s EE0-1 data for 2022:

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

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

| Gender Representation by Position (1) | | | | | | December 31, 2022 | | | | | | | | | | | | | | | | | | | | |

| | | | Male # (2) | | | | | | Female # (2) | | | | | | Male % | | | | | | Female % | | | | | |

| Corporate - Top Executives, VPs, Assistant VPs, Directors, & Managers | | | | | | 74 | | | | | | 76 | | | | | | 49% | | | | | | 51% | | |

| Corporate - Below manager position | | | | | | 100 | | | | | | 173 | | | | | | 37% | | | | | | 63% | | |

| Field - Regional Directors/Managers, Community Managers | | | | | | 89 | | | | | | 173 | | | | | | 34% | | | | | | 66% | | |

| Field - Leasing Specialists, Leasing Managers, Relationship Reps, Bookkeepers | | | | | | 110 | | | | | | 216 | | | | | | 34% | | | | | | 66% | | |

| Field - Maintenance Supervisors and Techs | | | | | | 548 | | | | | | 11 | | | | | | 98% | | | | | | 2% | | |

For the fiscal year ended December 31, [removed: 2022][added: 2023]

As of June 30, [removed: 2022,] [added: 2023,] the aggregate market value of the voting stock held by non-affiliates of Essex Property Trust, Inc. was [removed: $16,906,398,955.][added: $14,926,731,683.]

As of February 21, [removed: 2023, 64,518,322] [added: 2024, 64,203,497] 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: 2023] [added: 2024] 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: 2022.][added: 2023.]

This report combines the annual reports on Form 10-K for the year ended December 31, [removed: 2022] [added: 2023] 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: 2022,] [added: 2023,] Essex owned approximately 96.6% of the ownership interest in the Operating Partnership with the remaining 3.4% interest owned by limited partners.

[added: The noncontrolling interest in Essex's] consolidated financial statements include (i) the same noncontrolling interest as presented in the Operating Partnership’s consolidated financial statements and (ii) OP Unitholders.

[removed: 2022] [added: 2023] ANNUAL REPORT ON FORM 10-K

| Item 1. | | | [removed: [Business](#i973047f3d5504a24aed3e92d095cd667_19)] [added: [Business](#i119c2a136bff4fbda6afe58370b5ef66_16)] | | | [removed: [1](#i973047f3d5504a24aed3e92d095cd667_19)] [added: [2](#i119c2a136bff4fbda6afe58370b5ef66_16)] | | |

| Item 1A. | | | [Risk [removed: Factors](#i973047f3d5504a24aed3e92d095cd667_22)] [added: Factors](#i119c2a136bff4fbda6afe58370b5ef66_19)] | | | [removed: [8](#i973047f3d5504a24aed3e92d095cd667_22)] [added: [10](#i119c2a136bff4fbda6afe58370b5ef66_19)] | | |

| Item 1B. | | | [Unresolved Staff [removed: Comments](#i973047f3d5504a24aed3e92d095cd667_25)] [added: Comments](#i119c2a136bff4fbda6afe58370b5ef66_22)] | | | [removed: [21](#i973047f3d5504a24aed3e92d095cd667_25)] [added: [24](#i119c2a136bff4fbda6afe58370b5ef66_22)] | | |

| Item 2. | | | [removed: [Properties](#i973047f3d5504a24aed3e92d095cd667_28)] [added: [Properties](#i119c2a136bff4fbda6afe58370b5ef66_25)] | | | [removed: [22](#i973047f3d5504a24aed3e92d095cd667_28)] [added: [25](#i119c2a136bff4fbda6afe58370b5ef66_25)] | | |

| Item 3. | | | [Legal [removed: Proceedings](#i973047f3d5504a24aed3e92d095cd667_31)] [added: Proceedings](#i119c2a136bff4fbda6afe58370b5ef66_28)] | | | [removed: [29](#i973047f3d5504a24aed3e92d095cd667_31)] [added: [32](#i119c2a136bff4fbda6afe58370b5ef66_28)] | | |

| Item 4. | | | [Mine Safety [removed: Disclosures](#i973047f3d5504a24aed3e92d095cd667_34)] [added: Disclosures](#i119c2a136bff4fbda6afe58370b5ef66_31)] | | | [removed: [29](#i973047f3d5504a24aed3e92d095cd667_34)] [added: [32](#i119c2a136bff4fbda6afe58370b5ef66_31)] | | |

| Item 5. | | | [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity [removed: Securities](#i973047f3d5504a24aed3e92d095cd667_40)] [added: Securities](#i119c2a136bff4fbda6afe58370b5ef66_37)] | | | [removed: [30](#i973047f3d5504a24aed3e92d095cd667_40)] [added: [33](#i119c2a136bff4fbda6afe58370b5ef66_37)] | | |

| Item 6. | | | [removed: [\[Reserved\]](#i973047f3d5504a24aed3e92d095cd667_43)] [added: [\[Reserved\]](#i119c2a136bff4fbda6afe58370b5ef66_40)] | | | [removed: [34](#i973047f3d5504a24aed3e92d095cd667_43)] [added: [36](#i119c2a136bff4fbda6afe58370b5ef66_40)] | | |

| Item 7. | | | [Management's Discussion and Analysis of Financial Condition and Results of [removed: Operations](#i973047f3d5504a24aed3e92d095cd667_46)] [added: Operations](#i119c2a136bff4fbda6afe58370b5ef66_43)] | | | [removed: [35](#i973047f3d5504a24aed3e92d095cd667_46)] [added: [37](#i119c2a136bff4fbda6afe58370b5ef66_43)] | | |

| Item 7A. | | | [Quantitative and Qualitative Disclosures About Market [removed: Risks](#i973047f3d5504a24aed3e92d095cd667_58)] [added: Risks](#i119c2a136bff4fbda6afe58370b5ef66_55)] | | | [removed: [47](#i973047f3d5504a24aed3e92d095cd667_58)] [added: [48](#i119c2a136bff4fbda6afe58370b5ef66_55)] | | |

| Item 8. | | | [Financial Statements and Supplementary [removed: Data](#i973047f3d5504a24aed3e92d095cd667_61)] [added: Data](#i119c2a136bff4fbda6afe58370b5ef66_58)] | | | [removed: [48](#i973047f3d5504a24aed3e92d095cd667_61)] [added: [49](#i119c2a136bff4fbda6afe58370b5ef66_58)] | | |

| Item 9. | | | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#i973047f3d5504a24aed3e92d095cd667_64)] [added: Disclosure](#i119c2a136bff4fbda6afe58370b5ef66_61)] | | | [removed: [48](#i973047f3d5504a24aed3e92d095cd667_64)] [added: [49](#i119c2a136bff4fbda6afe58370b5ef66_61)] | | |

| Item 9A. | | | [Controls and [removed: Procedures](#i973047f3d5504a24aed3e92d095cd667_67)] [added: Procedures](#i119c2a136bff4fbda6afe58370b5ef66_64)] | | | [removed: [48](#i973047f3d5504a24aed3e92d095cd667_67)] [added: [49](#i119c2a136bff4fbda6afe58370b5ef66_64)] | | |

| Item 9B. | | | [Other [removed: Information](#i973047f3d5504a24aed3e92d095cd667_70)] [added: Information](#i119c2a136bff4fbda6afe58370b5ef66_67)] | | | [removed: [49](#i973047f3d5504a24aed3e92d095cd667_70)] [added: [50](#i119c2a136bff4fbda6afe58370b5ef66_67)] | | |

| Item 9C. | | | [Disclosure Regarding Foreign Jurisdictions that Prevent [removed: Inspections](#i973047f3d5504a24aed3e92d095cd667_73)] [added: Inspections](#i119c2a136bff4fbda6afe58370b5ef66_70)] | | | [removed: [49](#i973047f3d5504a24aed3e92d095cd667_73)] [added: [51](#i119c2a136bff4fbda6afe58370b5ef66_70)] | | |

| Item 10. | | | [Directors, Executive Officers and Corporate [removed: Governance](#i973047f3d5504a24aed3e92d095cd667_79)] [added: Governance](#i119c2a136bff4fbda6afe58370b5ef66_76)] | | | [removed: [50](#i973047f3d5504a24aed3e92d095cd667_79)] [added: [52](#i119c2a136bff4fbda6afe58370b5ef66_76)] | | |

| Item 11. | | | [Executive [removed: Compensation](#i973047f3d5504a24aed3e92d095cd667_82)] [added: Compensation](#i119c2a136bff4fbda6afe58370b5ef66_79)] | | | [removed: [50](#i973047f3d5504a24aed3e92d095cd667_82)] [added: [52](#i119c2a136bff4fbda6afe58370b5ef66_79)] | | |

| Item 12. | | | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#i973047f3d5504a24aed3e92d095cd667_85)] [added: Matters](#i119c2a136bff4fbda6afe58370b5ef66_82)] | | | [removed: [50](#i973047f3d5504a24aed3e92d095cd667_85)] [added: [52](#i119c2a136bff4fbda6afe58370b5ef66_82)] | | |

| Item 13. | | | [Certain Relationships and Related Transactions, and Director [removed: Independence](#i973047f3d5504a24aed3e92d095cd667_88)] [added: Independence](#i119c2a136bff4fbda6afe58370b5ef66_85)] | | | [removed: [50](#i973047f3d5504a24aed3e92d095cd667_88)] [added: [52](#i119c2a136bff4fbda6afe58370b5ef66_85)] | | |

| Item 14. | | | [Principal Accounting Fees and [removed: Services](#i973047f3d5504a24aed3e92d095cd667_91)] [added: Services](#i119c2a136bff4fbda6afe58370b5ef66_88)] | | | [removed: [50](#i973047f3d5504a24aed3e92d095cd667_91)] [added: [52](#i119c2a136bff4fbda6afe58370b5ef66_88)] | | |

| Item 15. | | | [Exhibits and Financial Statement [removed: Schedules](#i973047f3d5504a24aed3e92d095cd667_97)] [added: Schedules](#i119c2a136bff4fbda6afe58370b5ef66_94)] | | | [removed: [51](#i973047f3d5504a24aed3e92d095cd667_97)] [added: [53](#i119c2a136bff4fbda6afe58370b5ef66_94)] | | |

| Item 16. | | | [Form 10-K [removed: Summary](#i973047f3d5504a24aed3e92d095cd667_97)] [added: Summary](#i119c2a136bff4fbda6afe58370b5ef66_94)] | | | [removed: [51](#i973047f3d5504a24aed3e92d095cd667_97)] [added: [53](#i119c2a136bff4fbda6afe58370b5ef66_94)] | | |

*[Table of [removed: Contents](#i973047f3d5504a24aed3e92d095cd667_10)*][added: Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*]

| Item 1C. | | | [Cybersecurity](#i119c2a136bff4fbda6afe58370b5ef66_2012) | | | [24](#i119c2a136bff4fbda6afe58370b5ef66_2012) | | |

| [Signatures](#i119c2a136bff4fbda6afe58370b5ef66_208) | | | | | | [S-](#i119c2a136bff4fbda6afe58370b5ef66_208)[1](#i119c2a136bff4fbda6afe58370b5ef66_208) | | |

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

The noncontrolling interest in Essex's

| [Signatures](#i973047f3d5504a24aed3e92d095cd667_211) | | | | | | [S-](#i973047f3d5504a24aed3e92d095cd667_211)[1](#i973047f3d5504a24aed3e92d095cd667_211) | | |

*[Table of Contents](#i973047f3d5504a24aed3e92d095cd667_10)*

The Company has developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity and availability of its critical systems and information.

The Company's cybersecurity risk management program employs several different measures, including perimeter monitoring, endpoint monitoring and user management, designed to assess and identify cybersecurity risks.

The Company’s technology management team is principally responsible for managing the Company’s cybersecurity risk assessment and management processes.

The Company’s technology management team performs enterprise-level risk assessments designed to help identify material cybersecurity risks to our critical systems, information, products, services, and our broader enterprise IT environment.

The Company’s technology management team and third-party professionals perform penetration tests, vulnerability scans, and patch management to assess and protect the confidentiality, integrity and availability of its critical systems and information.

The Company provides training to its employees on cybersecurity matters, performs periodic awareness testing to facilitate compliance with the Company’s cybersecurity policies, and maintains a method for its employees and consultants to communicate any suspected cybersecurity incident.

In addition, the Company evaluates key third-party service providers before the Company grants the service provider access to its information systems and has a process in place to ensure that future access is appropriate.

The Company has an established incident response plan for responding to cybersecurity incidents.

The goal of the incident response plan is to detect and react to cybersecurity incidents, evaluate the scope and risk, respond appropriately, communicate effectively to all stakeholders, and ultimately reduce the likelihood of an incident recurrence.

The Company’s incident response team consists of seasoned information technology, legal and financial reporting Company personnel.

The incident response plan, members of the incident response team and the steps to respond to a security incident are evaluated for appropriateness and effectiveness, and key personnel from cross-functional departments are involved.

The Board of Directors considers cybersecurity risk as part of its risk oversight function and has delegated to the Audit Committee oversight of enterprise level risks, including any cybersecurity-related risks faced by the Company.

At least quarterly, the Audit Committee reviews cyber risks and mitigation strategies with senior management.

The Audit Committee reports to the full Board regarding its activities, including those relating to cybersecurity.

Additionally, on an annual basis, the Chief Technology Officer (“CTO”) presents to the Audit Committee on any material updates to the cybersecurity program, such as process improvements, new initiatives and key vendor performance.

Material cybersecurity events, if any, are escalated to the Board on an ongoing basis.

The Board is also briefed annually on all major enterprise risks, including cybersecurity risks.

The Company’s management team, including the CTO, is responsible for assessing and managing the Company’s material risks from cybersecurity threats.

The CTO leads the technology management team and has extensive cybersecurity knowledge and expertise developed through a career of serving in various roles in information technology for over 20 years.

The CTO oversees the Company’s initiatives to address existing or evolving cyber risks and is a member of the Enterprise Risk Committee.

The CTO reports to the Chief Executive Officer (“CEO”) and provides updates to the Company’s senior leadership team on a regular basis, at least quarterly, about risks from cybersecurity threats, the results of penetration tests, vulnerability scans and userbase issues.

Over the past fiscal year, the Company has not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect the Company, including its operations, business strategy, results of operations or financial condition.

See *“Risk Factors – We are subject to laws and regulations relating to the handling of personal information and we rely on information technology to sustain our operations.

Any failure by us to comply with applicable requirements or material failure, inadequacy, interruption or* *breach of the Company’s privacy or information systems, or those of our vendors or other third parties, could materially adversely affect the Company’s business, results of operations and financial condition”.*

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

The Company’s portfolio as of December 31, [removed: 2022] [added: 2023] (including communities owned by unconsolidated joint ventures, but excluding communities underlying preferred equity investments) was comprised of 252 stabilized operating apartment communities (comprising [removed: 62,147] [added: 61,997] apartment homes), of which [removed: 26,374] [added: 26,209] apartment homes are located in Southern California, [removed: 23,248] [added: 23,263] apartment homes are located in Northern California, and 12,525 apartment homes are located in the Seattle metropolitan area.

The Company’s apartment communities accounted for [removed: 99.0%] [added: 98.9%] of the Company’s revenues for the year ended December 31, [removed: 2022.][added: 2023.]

As of December 31, [removed: 2022,] [added: 2023,] the Company’s communities include 104 garden-style, 138 mid-rise, and 10 high-rise communities.

The communities have an average of approximately [removed: 247] [added: 246] apartment homes, with a mix of studio, one-, two- and some three-bedroom apartment homes.

The Company owns three commercial buildings [removed: with] [added: (totaling] approximately 283,000 square [removed: feet] [added: feet)] located in California and Washington, of which the Company occupied [added: an aggregate of] approximately [removed: 13,000] [added: 35,000] square feet as of December 31, [removed: 2022.][added: 2023.]

Furthermore, as of December 31, [removed: 2022,] [added: 2023,] the commercial buildings' physical occupancy rate was [removed: 83%] [added: 90%] consisting of 7 tenants, including the Company.

The table below describes the Company’s operating portfolio as of December 31, [removed: 2022.][added: 2023.]

(See Note 8, "Mortgage Notes Payable" to the Company’s consolidated financial statements included in Part IV, Item 15 of this Annual Report on Form 10-K for more [added: information about the Company’s secured mortgage debt and Schedule III thereto for a list of secured mortgage loans related to the Company’s portfolio.)]

*[Table of [removed: Contents](#i973047f3d5504a24aed3e92d095cd667_10)*][added: Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*]

| Barkley, The (3)(4) | | | | | | Anaheim, CA | | | | | | Garden | | | | | | 161 | | | | | | 1984 | | | | | | 2000 | | | | | | [removed: 97%] [added: 96%] | | |

| Park Viridian | | | | | | Anaheim, CA | | | | | | Mid-rise | | | | | | 320 | | | | | | 2008 | | | | | | 2014 | | | | | | [removed: 96%] [added: 97%] | | |

| Bonita Cedars | | | | | | Bonita, CA | | | | | | Garden | | | | | | 120 | | | | | | 1983 | | | | | | 2002 | | | | | | [removed: 97%] [added: 96%] | | |

| Camarillo Oaks | | | | | | Camarillo, CA | | | | | | Garden | | | | | | 564 | | | | | | 1985 | | | | | | 1996 | | | | | | [removed: 96%] [added: 97%] | | |

| Camino Ruiz Square | | | | | | Camarillo, CA | | | | | | Garden | | | | | | [removed: 159] [added: 160] | | | | | | 1990 | | | | | | 2006 | | | | | | [removed: 98%] [added: 97%] | | |

| Mesa Village | | | | | | Clairemont, CA | | | | | | Garden | | | | | | 133 | | | | | | 1963 | | | | | | 2002 | | | | | | [removed: 96%] [added: 97%] | | |

| Villa Siena | | | | | | Costa Mesa, CA | | | | | | Garden | | | | | | 272 | | | | | | 1974 | | | | | | 2014 | | | | | | [removed: 96%] [added: 95%] | | |

| Regency at Encino | | | | | | Encino, CA | | | | | | Mid-rise | | | | | | 75 | | | | | | 1989 | | | | | | 2009 | | | | | | [removed: 98%] [added: 97%] | | |

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

| Valley Park | | | | | | Fountain Valley, CA | | | | | | Garden | | | | | | 160 | | | | | | 1969 | | | | | | 2001 | | | | | | [removed: 97%] [added: 96%] | | |

| Capri at Sunny Hills (4) | | | | | | Fullerton, CA | | | | | | Garden | | | | | | 102 | | | | | | 1961 | | | | | | 2001 | | | | | | [removed: 95%] [added: 96%] | | |

| The Henley I | | | | | | Glendale, CA | | | | | | Mid-rise | | | | | | 83 | | | | | | 1974 | | | | | | 1999 | | | | | | [removed: 96%] [added: 97%] | | |

| The Henley II | | | | | | Glendale, CA | | | | | | Mid-rise | | | | | | 132 | | | | | | 1970 | | | | | | 1999 | | | | | | [removed: 96%] [added: 97%] | | |

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

| Village Green | | | | | | La Habra, CA | | | | | | Garden | | | | | | 272 | | | | | | 1971 | | | | | | 2014 | | | | | | [removed: 96%] [added: 97%] | | |

| The Palms at Laguna Niguel | | | | | | Laguna Niguel, CA | | | | | | Garden | | | | | | 460 | | | | | | 1988 | | | | | | 2014 | | | | | | [removed: 96%] [added: 97%] | | |

| Trabuco Villas | | | | | | Lake Forest, CA | | | | | | Mid-rise | | | | | | 132 | | | | | | 1985 | | | | | | 1997 | | | | | | [removed: 98%] [added: 96%] | | |

| 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: 98%] | | |

| Ashton Sherman Village | | | | | | Los Angeles, CA | | | | | | Mid-rise | | | | | | 264 | | | | | | 2014 | | | | | | 2016 | | | | | | [removed: 97%] [added: 98%] | | |

| Avant | | | | | | Los Angeles, CA | | | | | | Mid-rise | | | | | | 440 | | | | | | 2014 | | | | | | 2015 | | | | | | [removed: 95%] [added: 93%] | | |

| The Avery | | | | | | Los Angeles, CA | | | | | | Mid-rise | | | | | | 121 | | | | | | 2014 | | | | | | 2014 | | | | | | [removed: 96%] [added: 98%] | | |

| Bellerive | | | | | | Los Angeles, CA | | | | | | Mid-rise | | | | | | 63 | | | | | | 2011 | | | | | | 2011 | | | | | | [removed: 97%] [added: 96%] | | |

| Belmont Station | | | | | | Los Angeles, CA | | | | | | Mid-rise | | | | | | 275 | | | | | | 2009 | | | | | | 2009 | | | | | | [removed: 96%] [added: 95%] | | |

| Bunker Hill | | | | | | Los Angeles, CA | | | | | | High-rise | | | | | | 456 | | | | | | 1968 | | | | | | 1998 | | | | | | [removed: 95%] [added: 96%] | | |

| Catalina Gardens | | | | | | Los Angeles, CA | | | | | | Mid-rise | | | | | | 128 | | | | | | 1987 | | | | | | 2014 | | | | | | [removed: 95%] [added: 93%] | | |

| Cochran Apartments | | | | | | Los Angeles, CA | | | | | | Mid-rise | | | | | | 58 | | | | | | 1989 | | | | | | 1998 | | | | | | [removed: 96%] [added: 97%] | | |

| Gas Company Lofts (6) | | | | | | Los Angeles, CA | | | | | | High-rise | | | | | | 251 | | | | | | 2004 | | | | | | 2013 | | | | | | [removed: 96%] [added: 95%] | | |

| The Blake LA | | | | | | Los Angeles, CA | | | | | | Mid-rise | | | | | | 196 | | | | | | 1979 | | | | | | 1997 | | | | | | [removed: 97%] [added: 98%] | | |

| Marbella | | | | | | Los Angeles, CA | | | | | | Mid-rise | | | | | | 60 | | | | | | 1991 | | | | | | 2005 | | | | | | [removed: 96%] [added: 97%] | | |

| Pacific Electric Lofts (8) | | | | | | Los Angeles, CA | | | | | | High-rise | | | | | | 314 | | | | | | 2006 | | | | | | 2012 | | | | | | [removed: 95%] [added: 94%] | | |

| Hacienda at Camarillo Oaks | | | | | | Camarillo, CA | | | | | | Garden | | | | | | 73 | | | | | | 1984 | | | | | | 2023 | | | | | | 86% | | |

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

| | | | | | | | | | | | | | | | | | | 26,209 | | | | | | | | | | | | | | | | | | 96% | | |

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

| | | | | | | | | | | | | | | | | | | 23,263 | | | | | | | | | | | | | | | | | | 96% | | |

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

| | | | | | | | | | | | | | | | | | | 12,525 | | | | | | | | | | | | | | | | | | 97% | | |

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

information about the Company’s secured mortgage debt and Schedule III thereto for a list of secured mortgage loans related to the Company’s portfolio.)

| CBC and The Sweeps | | | | | | Goleta, CA | | | | | | Garden | | | | | | 239 | | | | | | 1962 | | | | | | 2006 | | | | | | 99% | | |

| | | | | | | | | | | | | | | | | | | 26,374 | | | | | | | | | | | | | | | | | | 96% | | |

| | | | | | | | | | | | | | | | | | | 23,248 | | | | | | | | | | | | | | | | | | 96% | | |

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

*[Table of [removed: Contents](#i973047f3d5504a24aed3e92d095cd667_10)*][added: Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*]

The approximate number of holders of record of the shares of Essex's common stock was [removed: 987] [added: 1,043] as of February 21, [removed: 2023.][added: 2024.]

As of February 21, [removed: 2023,] [added: 2024,] there were [removed: 64] [added: 62] holders of record of OP Units, including Essex.

The status of the cash dividends distributed for the years ended December 31, [added: 2023,] 2022, [removed: 2021,] and [removed: 2020] [added: 2021] related to common stock are as follows:

| | | | | | | [removed: 2022] [added: 2023] | | | | | | [removed: 2021] [added: 2022] | | | | | | [removed: 2020] [added: 2021] | | |

| Ordinary income | | | | | | [removed: 80.17] [added: 88.46] | | % | | | | [removed: 70.92] [added: 80.17] | | % | | | | [removed: 85.23] [added: 70.92] | | % |

| Capital gain | | | | | | [removed: 16.78] [added: 8.32] | | % | | | | [removed: 22.07] [added: 16.78] | | % | | | | [removed: 10.68] [added: 22.07] | | % |

| Unrecaptured section 1250 capital gain | | | | | | [removed: 3.05] [added: 3.22] | | % | | | | [removed: 7.01] [added: 3.05] | | % | | | | [removed: 4.09] [added: 7.01] | | % |

The Board of Directors declared a dividend/distribution for the fourth quarter of [removed: 2022] [added: 2023] of [removed: $2.20] [added: $2.31] per share.

The dividend/distribution was paid on January [removed: 13, 2023] [added: 12, 2024] to stockholders/unitholders of record as of January [removed: 3, 2023.][added: 2, 2024.]

*[Table of [removed: Contents](#i973047f3d5504a24aed3e92d095cd667_10)*][added: Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*]

The information required by this section is incorporated herein by reference from our Proxy Statement, relating to our [removed: 2023] [added: 2024] Annual Meeting of Shareholders, under the headings "Equity Compensation [removed: Plan Information,"] [added: Plans,"] to be filed with the SEC within 120 days of December 31, [removed: 2022.][added: 2023.]

During the year ended December 31, [removed: 2022,] [added: 2023,] the Company did not issue any shares of common stock under the 2021 ATM Program.

As of December 31, [removed: 2022,] [added: 2023,] there were no outstanding forward sale agreements, and $900.0 million of shares remain available to be sold under the 2021 ATM Program.

In [removed: December 2015, Essex's] [added: September 2022, the Company's] Board of Directors [removed: authorized] [added: approved] a [added: new] stock repurchase plan to allow [removed: Essex] [added: the Company] to acquire shares of common stock up to an aggregate value of [removed: $250.0] [added: $500.0] million.

[removed: In February 2019, the Board of Directors approved the replenishment of the stock repurchase plan such that, as] [added: As] of [removed: such date,] [added: December 31, 2023,] the Company had [removed: $250.0] [added: $302.7] million of purchase authority remaining under the stock repurchase plan.

During the year ended December 31, [removed: 2022,] [added: 2023,] the Company repurchased and retired [removed: 740,053] [added: 437,026] shares of its common stock totaling [removed: $189.7] [added: $95.7] million, including commissions, at an average price of [removed: $256.37] [added: $218.88] per share.

The line graph below compares the cumulative total stockholder return on Essex's common stock for the last five years with the cumulative total return on the S&P [removed: 500, the FTSE NAREIT All Equity REIT index] [added: 500] and the FTSE NAREIT Equity Apartments index over the same period.

This comparison assumes that the value of the investment in the common stock and each index was $100 on December 31, [removed: 2017] [added: 2018] and that all dividends were reinvested.

[removed: ][added: ]

| Index | | | | | | [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] | | | | | | [removed: 12/31/2021] [added: 12/31/2022] | | | | | | [removed: 12/31/2022] [added: 12/31/2023] | | |

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

During the years ended December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] 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: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] Essex issued an aggregate of [removed: 76,246] [added: zero] and [removed: 248,725] [added: 76,246] shares of its common stock upon the exercise of stock options, respectively.

Essex contributed the proceeds from the option exercises of [removed: $19.5 million] [added: no amount] and [removed: $58.5] [added: $19.5] million to the Operating Partnership in exchange for an aggregate of [removed: 76,246] [added: zero] and [removed: 248,725] [added: 76,246] OP Units, as required by the Operating Partnership’s partnership agreement, during the years ended December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] respectively.

During the years ended December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] Essex issued an aggregate of [removed: 11,707] [added: 22,236] and [removed: 30,360] [added: 11,707] shares of its common stock in connection with restricted stock awards for no cash consideration, respectively.

For each share of common stock issued by Essex in connection with such awards, the Operating Partnership issued OP Units to Essex as required by the Operating Partnership's partnership agreement, for an aggregate of [removed: 11,707] [added: 22,236] and [removed: 30,360] [added: 11,707] OP Units during the years ended December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] respectively.

During the years ended December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] Essex issued an aggregate of [removed: 8,310] [added: 13,684] and [removed: 10,293] [added: 8,310] shares of its common stock in connection with the exchange of OP Units by limited partners into shares of common 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: 8,310] [added: 13,684] and [removed: 10,293] [added: 8,310] OP Units during the [removed: year] [added: years] ended December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] respectively.

During the [removed: year] [added: years] ended December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] the Company did not issue or sell any shares of common stock pursuant to the 2021 ATM Program.

As of December 31, [removed: 2022,] [added: 2023,] there were no outstanding forward sale agreements.

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

| Essex Property Trust, Inc. | | | | | | $ | 100.00 | | | | | $ | 125.92 | | | | | $ | 103.14 | | | | | $ | 157.18 | | | | | $ | 97.83 | | | | | $ | 119.33 | |

| FTSE NAREIT Equity Apartments Index | | | | | | $ | 100.00 | | | | | $ | 126.32 | | | | | $ | 106.94 | | | | | $ | 174.97 | | | | | $ | 119.06 | | | | | $ | 126.05 | |

| S&P 500 Index | | | | | | $ | 100.00 | | | | | $ | 131.49 | | | | | $ | 155.68 | | | | | $ | 200.37 | | | | | $ | 164.08 | | | | | $ | 207.21 | |

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

In each of May and December 2020, the Board of Directors approved the replenishment of the stock repurchase plan such that, as of each such date, Essex had $250.0 million of purchase authority remaining under the replenished plan.

In September 2022, the Board of Directors approved a new stock repurchase plan to allow Essex to acquire shares of common stock up to an aggregate value of $500.0 million and as of December 31, 2022, the Company had repurchased 420,606 shares of common stock under this plan, totaling $101.7 million.

The plan supersedes the previous common stock repurchase plan announced in December 2015.

As of December 31, 2022, the Company had $398.3 million of purchase authority remaining under the stock repurchase plan.

The FTSE NAREIT Equity Apartments index was added in the current year as it more closely aligns with executive compensation and performance of the Company against its more directly comparable peers.

| Essex Property Trust, Inc. | | | | | | $ | 100.00 | | | | | $ | 104.83 | | | | | $ | 132.00 | | | | | $ | 108.12 | | | | | $ | 164.77 | | | | | $ | 102.55 | |

| FTSE NAREIT Equity Apartments Index | | | | | | $ | 100.00 | | | | | $ | 103.70 | | | | | $ | 130.99 | | | | | $ | 110.89 | | | | | $ | 181.43 | | | | | $ | 123.46 | |

| FTSE NAREIT All Equity REITs Index | | | | | | $ | 100.00 | | | | | $ | 95.96 | | | | | $ | 123.46 | | | | | $ | 117.14 | | | | | $ | 165.51 | | | | | $ | 124.22 | |

| S&P 500 Index | | | | | | $ | 100.00 | | | | | $ | 95.62 | | | | | $ | 125.72 | | | | | $ | 148.85 | | | | | $ | 191.58 | | | | | $ | 156.88 | |

Stock Repurchases

The following table summarizes the Company's purchase of shares of its common stock during the three months ended December 31, 2022:

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

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

| | | | | | | 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) | | |

| November 1, 2022 - November 30, 2022 | | | | | | 28,200 | | | | | | $ | 210.82 | | | | | 28,200 | | | | | | $ | 424.2 | |

| December 1, 2022 - December 31, 2022 | | | | | | 121,009 | | | | | | $ | 213.45 | | | | | 121,009 | | | | | | $ | 398.3 | |

| Total | | | | | | 149,209 | | | | | | $ | 212.95 | | | | | 149,209 | | | | | | $ | 398.3 | |

(1) In September 2022, the Board of Directors approved a new stock repurchase plan to allow the Company to acquire shares of common stock up to an aggregate of $500.0 million.

Following the approval of the new plan, 420,606 shares of common stock totaling $101.7 million were repurchased under the new plan.

*[Table of [removed: Contents](#i973047f3d5504a24aed3e92d095cd667_10)*][added: Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*]

As of December 31, [removed: 2022,] [added: 2023,] 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: 2022,] [added: 2023,] 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: 2022,] [added: 2023,] that have materially affected, or are reasonably likely to materially affect, Essex’s internal control over financial reporting.

*[Table of [removed: Contents](#i973047f3d5504a24aed3e92d095cd667_10)*][added: Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*]

Essex’s management assessed the effectiveness of Essex’s internal control over financial reporting as of December 31, [removed: 2022.][added: 2023.]

Essex’s management has concluded that, as of December 31, [removed: 2022,] [added: 2023,] its internal control over financial reporting was effective based on these criteria.

As of December 31, [removed: 2022,] [added: 2023,] 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: 2022,] [added: 2023,] 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: 2022,] [added: 2023,] 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: 2022.][added: 2023.]

The Operating Partnership’s management has concluded that, as of December 31, [removed: 2022,] [added: 2023,] its internal control over financial reporting was effective based on these criteria.

Securities Trading Plans of Directors and Executive Officers

During the three months ended December 31, 2023, none of our officers or directors adopted or terminated any contract, instruction or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non Rule 10b5-1 trading arrangement*."*

Severance Plan

On February 21 2024, the Company’s Board adopted the Amended and Restated Essex Property Trust, Inc. Executive Severance Plan (the “Severance Plan”) replacing the existing severance plan dating from 2013.

The Severance Plan provides for the payment of severance and other benefits to participants in the event of a qualifying termination of employment with the Company.

Each of the Company’s executive officers is eligible to participate in the Severance Plan.

Under the Severance Plan, in the event of a termination of employment by the Company without cause, outside of the change in control context, an executive will be eligible to receive a lump-sum cash payment equal to the sum of (i) a number of weeks’ base salary, determined based on the executive’s number of completed years of service at the time of termination, with a maximum of 52 weeks (or 24 months’ base salary for the Chief Executive Officer (“CEO”)), plus (ii) his or her pro-rated target annual bonus for the year of termination.

*[Table of Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*

In the event of a termination of employment by the Company in the change of control context, an executive will be eligible to receive: (i) a lump-sum cash payment equal to 24 months’ base salary (36 months’ base salary for the CEO), plus two-times (three-times for the CEO) his or her target annual bonus for the year of termination; plus (ii) accelerated vesting of each outstanding equity award held by the executive as of his or her termination date (except for performance-vesting awards granted prior to the change in control, which will continue to be governed by the terms of the applicable award agreement); plus (iii) the extension of other in-place benefits as set forth in the Severance Plan.

An executive’s right to receive the severance payments and benefits described above is subject to his or her delivery and non-revocation of a general release of claims in favor of the Company, and his or her continued compliance with any applicable restrictive covenants.

None.

*[Table of [removed: Contents](#i973047f3d5504a24aed3e92d095cd667_10)*][added: Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*]

The information required by this Item is incorporated herein by reference from our Proxy Statement, relating to our [removed: 2023] [added: 2024] 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: 2022.][added: 2023.]

The information required by this Item is incorporated herein by reference from our Proxy Statement, relating to our [removed: 2023] [added: 2024] 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: 2022.][added: 2023.]

The information required by this Item is incorporated herein by reference from our Proxy Statement, relating to our [removed: 2023] [added: 2024] 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: 2022.][added: 2023.]

The information required by this Item is incorporated herein by reference from our Proxy Statement, relating to our [removed: 2023] [added: 2024] 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: 2022.][added: 2023.]

The information required by this Item is incorporated herein by reference from our Proxy Statement, relating to our [removed: 2023] [added: 2024] 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: 2022.][added: 2023.]

*[Table of [removed: Contents](#i973047f3d5504a24aed3e92d095cd667_10)*][added: Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*]

| Reports of Independent Registered Public Accounting Firm (PCAOB ID: 185) | | | [removed: [F-](#i973047f3d5504a24aed3e92d095cd667_100)[1](#i973047f3d5504a24aed3e92d095cd667_100)] [added: [F-](#i119c2a136bff4fbda6afe58370b5ef66_97)[1](#i119c2a136bff4fbda6afe58370b5ef66_97)] | | |

| Consolidated Balance Sheets: As of December 31, [removed: 2022] [added: 2023] and [removed: 2021] [added: 2022] | | | [removed: [F-](#i973047f3d5504a24aed3e92d095cd667_109)[6](#i973047f3d5504a24aed3e92d095cd667_109)] [added: [F-](#i119c2a136bff4fbda6afe58370b5ef66_106)[6](#i119c2a136bff4fbda6afe58370b5ef66_106)] | | |

| Consolidated Statements of [added: Comprehensive] Income: Years ended December 31, [added: 2023,] 2022, [removed: 2021,] and [removed: 2020] [added: 2021] | | | [removed: [F-](#i973047f3d5504a24aed3e92d095cd667_112)[7](#i973047f3d5504a24aed3e92d095cd667_112)] [added: [F-](#i119c2a136bff4fbda6afe58370b5ef66_112)[8](#i119c2a136bff4fbda6afe58370b5ef66_112)] | | |

| Consolidated Statements of Comprehensive Income: Years ended December 31, [added: 2023,] 2022, [removed: 2021,] and [removed: 2020] [added: 2021] | | | [removed: [F-](#i973047f3d5504a24aed3e92d095cd667_115)[8](#i973047f3d5504a24aed3e92d095cd667_115)] [added: [F-](#i119c2a136bff4fbda6afe58370b5ef66_127)[15](#i119c2a136bff4fbda6afe58370b5ef66_127)] | | |

| Consolidated Statements of Equity: Years ended December 31, [added: 2023,] 2022, [removed: 2021,] and [removed: 2020] [added: 2021] | | | [removed: [F-](#i973047f3d5504a24aed3e92d095cd667_118)[9](#i973047f3d5504a24aed3e92d095cd667_118)] [added: [F-](#i119c2a136bff4fbda6afe58370b5ef66_115)[9](#i119c2a136bff4fbda6afe58370b5ef66_115)] | | |

| Consolidated Statements of Cash Flows: Years ended December 31, [added: 2023,] 2022, [removed: 2021,] and [removed: 2020] [added: 2021] | | | [removed: [F-](#i973047f3d5504a24aed3e92d095cd667_121)[11](#i973047f3d5504a24aed3e92d095cd667_121)] [added: [F-](#i119c2a136bff4fbda6afe58370b5ef66_118)[11](#i119c2a136bff4fbda6afe58370b5ef66_118)] | | |

| Notes to Consolidated Financial Statements | | | [removed: [F-](#i973047f3d5504a24aed3e92d095cd667_139)[20](#i973047f3d5504a24aed3e92d095cd667_139)] [added: [F-](#i119c2a136bff4fbda6afe58370b5ef66_136)[20](#i119c2a136bff4fbda6afe58370b5ef66_136)] | | |

| Report of Independent Registered Public Accounting Firm | | | [removed: [F-](#i973047f3d5504a24aed3e92d095cd667_106)[4](#i973047f3d5504a24aed3e92d095cd667_106)] [added: [F-](#i119c2a136bff4fbda6afe58370b5ef66_103)[4](#i119c2a136bff4fbda6afe58370b5ef66_103)] | | |

| Consolidated Balance Sheets: As of December 31, [removed: 2022] [added: 2023] and [removed: 2021] [added: 2022] | | | [removed: [F-](#i973047f3d5504a24aed3e92d095cd667_124)[13](#i973047f3d5504a24aed3e92d095cd667_124)] [added: [F-](#i119c2a136bff4fbda6afe58370b5ef66_121)[13](#i119c2a136bff4fbda6afe58370b5ef66_121)] | | |

| Consolidated Statements of Income: Years ended December 31, [added: 2023,] 2022, [removed: 2021,] and [removed: 2020] [added: 2021] | | | [removed: [F-](#i973047f3d5504a24aed3e92d095cd667_127)[14](#i973047f3d5504a24aed3e92d095cd667_127)] [added: [F-](#i119c2a136bff4fbda6afe58370b5ef66_109)[7](#i119c2a136bff4fbda6afe58370b5ef66_109)] | | |

| Consolidated Statements of [removed: Comprehensive] Income: Years ended December 31, [added: 2023,] 2022, [removed: 2021,] and [removed: 2020] [added: 2021] | | | [removed: [F-](#i973047f3d5504a24aed3e92d095cd667_130)[15](#i973047f3d5504a24aed3e92d095cd667_130)] [added: [F-](#i119c2a136bff4fbda6afe58370b5ef66_124)[14](#i119c2a136bff4fbda6afe58370b5ef66_124)] | | |

| Consolidated Statements of Capital: Years ended December 31, [added: 2023,] 2022, [removed: 2021,] and [removed: 2020] [added: 2021] | | | [removed: [F-](#i973047f3d5504a24aed3e92d095cd667_133)[16](#i973047f3d5504a24aed3e92d095cd667_133)] [added: [F-](#i119c2a136bff4fbda6afe58370b5ef66_130)[16](#i119c2a136bff4fbda6afe58370b5ef66_130)] | | |

| Consolidated Statements of Cash Flows: Years ended December 31, [added: 2023,] 2022, [removed: 2021,] and [removed: 2020] [added: 2021] | | | [removed: [F-](#i973047f3d5504a24aed3e92d095cd667_136)[18](#i973047f3d5504a24aed3e92d095cd667_136)] [added: [F-](#i119c2a136bff4fbda6afe58370b5ef66_133)[18](#i119c2a136bff4fbda6afe58370b5ef66_133)] | | |

| (3) Financial Statement Schedule – Schedule III – Real Estate and Accumulated Depreciation as of December 31, [removed: 2022] [added: 2023] | | | [removed: [F-](#i973047f3d5504a24aed3e92d095cd667_202)[57](#i973047f3d5504a24aed3e92d095cd667_202)] [added: [F-](#i119c2a136bff4fbda6afe58370b5ef66_199)[56](#i119c2a136bff4fbda6afe58370b5ef66_199)] | | |

| Notes to Consolidated Financial Statements | | | [F-](#i119c2a136bff4fbda6afe58370b5ef66_136)[20](#i119c2a136bff4fbda6afe58370b5ef66_136) | | |

*[Table of [removed: Contents](#i973047f3d5504a24aed3e92d095cd667_10)*][added: Contents](#i119c2a136bff4fbda6afe58370b5ef66_10)*]

We have audited the accompanying consolidated balance sheets of Essex Property Trust, [removed: Inc] [added: Inc.] and subsidiaries (the Company) as of December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] 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: 2022,] [added: 2023,] 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: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, [removed: 2022,] [added: 2023,] 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: 2022,] [added: 2023,] 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 23, [removed: 2023] [added: 2024] expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

As discussed in Note [removed: 2] [added: 2(d)] to the consolidated financial statements, the Company evaluates the carrying amount of rental properties for impairment whenever events or changes in circumstances indicate that the carrying amount of a rental property may be impaired.

[removed: The] [added: As of December 31, 2023, the] Company had [removed: $10.8] [added: $10.5] billion in rental [removed: properties as of December 31, 2022.][added: properties.]

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

This included controls [removed: over] [added: related to] the process for determining the length of the period the Company expects to receive cash flows from the rental property.

We have audited Essex Property Trust, Inc. and subsidiaries' (the Company) internal control over financial reporting as of December 31, [removed: 2022,] [added: 2023,] 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: 2022,] [added: 2023,] 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: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] 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: 2022,] [added: 2023,] and the related notes and financial statement schedule III (collectively, the consolidated financial statements), and our report dated February 23, [removed: 2023] [added: 2024] expressed an unqualified opinion on those consolidated financial statements.

We have audited the accompanying consolidated balance sheets of Essex Portfolio, L.P. and subsidiaries (the Operating Partnership) as of December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] the related consolidated statements of income, comprehensive income, capital, and cash flows for each of the years in the three-year period ended December 31, [removed: 2022,] [added: 2023,] 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: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, [removed: 2022,] [added: 2023,] in conformity with U.S. generally accepted accounting principles.

As discussed in Note [removed: 2] [added: 2(d)] to the consolidated financial statements, the Operating Partnership evaluates the carrying amount of rental properties for impairment whenever events or changes in circumstances indicate that the carrying amount of a rental property may be impaired.

[removed: The] [added: As of December 31, 2023, the] Operating Partnership had [removed: $10.8] [added: $10.5] billion in rental [removed: properties as of December 31, 2022.][added: properties.]

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

This included controls [removed: over] [added: related to] the process for determining the length of the period the Operating Partnership expects to receive cash flows from the rental property.

December 31, [removed: 2022] [added: 2023, 2022,] and 2021

| | | | [added: 2023 | | | | | |] 2022 | | | | | | 2021 | | |

| Land and land improvements | | | $ | [removed: 3,043,321] [added: 3,036,912] | | | | | $ | [removed: 3,032,678] [added: 3,043,321] | |

| Buildings and improvements | | | [removed: 12,922,906] [added: 13,098,311] | | | | | | [removed: 12,597,249] [added: 12,922,906] | | |

| Less: accumulated depreciation | | | [removed: (5,152,133)] [added: (5,664,931)] | | | | | | [removed: (4,646,854)] [added: (5,152,133)] | | |