Item 1. Condensed Consolidated Financial Statements

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Unaudited)

(In thousands, except share amounts)

ASSETS			March 31, 2025						December 31, 2024
Real estate investments:
Rental properties:
Land and land improvements			$	3,271,624					$	3,246,789
Buildings and improvements			14,505,983						14,342,729
			17,777,607						17,589,518
Less: accumulated depreciation			(6,171,689)						(6,150,618)
			11,605,918						11,438,900
Real estate under development			96,268						52,682
Co-investments			906,686						935,014
Real estate held for sale			112,173						—
			12,721,045						12,426,596
Cash and cash equivalents-unrestricted			98,735						66,795
Cash and cash equivalents-restricted			9,127						9,051
Marketable securities			76,013						69,794
Notes and other receivables, net of allowance for credit losses of $0.5 million as of both March 31, 2025 and December 31, 2024			133,724						206,706
Operating lease right-of-use assets			53,351						51,556
Prepaid expenses and other assets			94,263						96,861
Total assets			$	13,186,258					$	12,927,359
LIABILITIES AND EQUITY
Unsecured debt, net			$	5,870,662					$	5,473,788
Mortgage notes payable, net			919,590						989,884
Lines of credit			—						137,945
Accounts payable and accrued liabilities			232,594						212,747
Construction payable			20,679						14,347
Dividends payable			173,678						165,443
Distributions in excess of investments in co-investments			84,295						79,273
Liabilities associated with real estate held for sale			641						—
Operating lease liabilities			54,149						52,473
Other liabilities			50,019						50,220
Total liabilities			7,406,307						7,176,120
Commitments and contingencies (Note 11)
Redeemable noncontrolling interest			34,376						30,849
Equity:
Common stock; $0.0001 par value, 670,000,000 shares authorized; 64,358,097 and 64,280,466 shares issued and outstanding, respectively			6						6
Additional paid-in capital			6,672,346						6,668,047
Distributions in excess of accumulated earnings			(1,117,971)						(1,155,662)
Accumulated other comprehensive income, net			15,620						24,655
Total stockholders’ equity			5,570,001						5,537,046
Noncontrolling interest			175,574						183,344
Total equity			5,745,575						5,720,390
Total liabilities and equity			$	13,186,258					$	12,927,359

See accompanying notes to the unaudited condensed consolidated financial statements.

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ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Income and Comprehensive Income

(Unaudited)

(In thousands, except share and per share amounts)

			Three Months Ended March 31,
			2025						2024
Revenues:
Rental and other property			$	462,089					$	424,215
Management and other fees from affiliates			2,494						2,713
			464,583						426,928
Expenses:
Property operating, excluding real estate taxes			86,027						79,578
Real estate taxes			52,594						46,920
Corporate-level property management expenses			12,332						11,099
Depreciation and amortization			151,287						139,733
General and administrative			16,292						17,171
Expensed acquisition and investment related costs			—						68
			318,532						294,569
Gain on sale of real estate and land			111,030						—
Earnings from operations			257,081						132,359
Interest expense			(62,732)						(55,933)
Total return swap income			1,200						796
Interest and other income			4,289						57,275
Equity income from co-investments			13,209						12,366
Tax benefit (expense) on unconsolidated co-investments			163						(49)
Loss on early retirement of debt			(762)						—
Gain on remeasurement of co-investment			330						138,326
Net income			212,778						285,140
Net income attributable to noncontrolling interest			(9,668)						(12,409)
Net income available to common stockholders			$	203,110					$	272,731
Comprehensive income			$	203,423					$	293,135
Comprehensive income attributable to noncontrolling interest			(9,348)						(12,681)
Comprehensive income attributable to controlling interest			$	194,075					$	280,454
Per share data:
Basic:
Net income available to common stockholders			$	3.16					$	4.25
Weighted average number of shares outstanding during the period			64,314,899						64,205,086
Diluted:
Net income available to common stockholders			$	3.16					$	4.25
Weighted average number of shares outstanding during the period			64,349,899						64,212,006

See accompanying notes to the unaudited condensed consolidated financial statements.

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ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Equity for the three months ended March 31, 2025 and 2024

(Unaudited)

(In thousands, except per share amounts)

									Common stock												Additional paid-in capital						Distributions in excess of accumulated earnings						Accumulated other comprehensive income, net						Noncontrolling interest						Total
Three Months Ended March 31, 2025															Shares						Amount
Balances at December 31, 2024															64,280						$	6					$	6,668,047					$	(1,155,662)					$	24,655					$	183,344					$	5,720,390
Net income															—						—						—						203,110						—						9,668						212,778
Change in fair value of derivatives and amortization of swap settlements															—						—						—						—						(9,051)						(321)						(9,372)
Change in fair value of marketable debt securities, net															—						—						—						—						16						1						17
Issuance of common stock under:
Stock option and restricted stock plans, net															30						—						5,509						—						—						—						5,509
Equity based compensation costs															—						—						1,985						—						—						70						2,055
Changes in the redemption value of redeemable noncontrolling interest															—						—						(3,175)						—						—						(352)						(3,527)
Distributions to noncontrolling interest															—						—						—						—						—						(8,300)						(8,300)
Redemptions of noncontrolling interest															48						—						(20)						—						—						(8,536)						(8,556)
Common stock dividends ($2.57 per share)															—						—						—						(165,419)						—						—						(165,419)
Balances at March 31, 2025															64,358						$	6					$	6,672,346					$	(1,117,971)					$	15,620					$	175,574					$	5,745,575

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									Common stock												Additional paid-in capital						Distributions in excess of accumulated earnings						Accumulated other comprehensive income, net						Noncontrolling Interest						Total
Three Months Ended March 31, 2024															Shares						Amount
Balances at December 31, 2023															64,203						$	6					$	6,656,720					$	(1,267,536)					$	33,556					$	171,232					$	5,593,978
Net income															—						—						—						272,731						—						12,409						285,140
Change in fair value of derivatives and amortization of swap settlements															—						—						—						—						7,723						272						7,995
Issuance of common stock under:
Stock option and restricted stock plans, net															6						—						962						—						—						—						962
Sale of common stock, net															—						—						(8)						—						—						—						(8)
Equity based compensation costs															—						—						1,637						—						—						58						1,695
Changes in the redemption value of redeemable noncontrolling interest															—						—						(180)						—						—						193						13
Distributions to noncontrolling interest															—						—						—						—						—						(8,412)						(8,412)
Redemptions of noncontrolling interest															—						—						(249)						—						—						(30)						(279)
Common stock dividends ($2.45 per share)															—						—						—						(157,331)						—						—						(157,331)
Balances at March 31, 2024															64,209						$	6					$	6,658,882					$	(1,152,136)					$	41,279					$	175,722					$	5,723,753

See accompanying notes to the unaudited condensed consolidated financial statements.

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ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)

			Three Months Ended March 31,
			2025						2024
Cash flows from operating activities:
Net income			$	212,778					$	285,140
Adjustments to reconcile net income to net cash provided by operating activities:
Straight-lined rents			529						94
Depreciation and amortization			151,287						139,733
Amortization of discount and debt financing costs, net			220						2,341
Realized and unrealized gains on marketable securities, net			91						(3,351)
Provision for credit losses			(3)						47
Equity income from co-investments			(13,209)						(12,366)
Operating distributions from co-investments			13,709						9,080
Accrued interest from notes and other receivables			(2,593)						(3,953)
Gain on the sale of real estate and land			(111,030)						—
Equity-based compensation			1,958						1,592
Loss on early retirement of debt			762						—
Gain on remeasurement of co-investment			(330)						(138,326)
Changes in operating assets and liabilities:
Prepaid expenses, receivables, operating lease right-of-use assets, and other assets			2,996						(1,493)
Accounts payable, accrued liabilities, and operating lease liabilities			25,385						39,141
Other liabilities			(1,047)						(2,824)
Net cash provided by operating activities			281,503						314,855
Cash flows from investing activities:
Additions to real estate:
Acquisitions of real estate and acquisition related capital expenditures, net of cash acquired			(345,211)						(355,309)
Redevelopment			(12,046)						(11,417)
Development acquisitions of and additions to real estate under development			(7,856)						(1,348)
Capital expenditures on rental properties			(27,914)						(26,388)
Investments in notes receivable			—						(1,059)
Collections of notes and other receivables			3,096						—
Proceeds from insurance for property losses			848						301
Proceeds from dispositions of real estate			125,997						—
Contributions to co-investments			(3,934)						(2,074)
Changes in refundable deposits			(2,000)						—
Purchases of marketable securities			(6,306)						(163)
Sales and maturities of marketable securities			13						14
Non-operating distributions from co-investments			8,000						—
Net cash used in investing activities			(267,313)						(397,443)
Cash flows from financing activities:
Proceeds from unsecured debt and mortgage notes			398,416						349,132
Payments on unsecured debt and mortgage notes			(70,362)						(761)
Proceeds from lines of credit			550,897						—
Repayments of lines of credit			(688,842)						—

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			Three Months Ended March 31,
			2025						2024
Additions to deferred charges			(3,055)						(2,692)
Payments related to debt prepayment penalties			(697)						—
Net costs from issuance of common stock			—						(8)
Net proceeds from stock options exercised			6,028						962
Payments related to tax withholding for share-based compensation			(519)						—
Distributions to noncontrolling interest			(7,998)						(7,901)
Redemption of noncontrolling interest			(8,556)						(279)
Common stock dividends paid			(157,486)						(148,329)
Net cash provided by financing activities			17,826						190,124
Net increase in unrestricted and restricted cash and cash equivalents			32,016						107,536
Unrestricted and restricted cash and cash equivalents at beginning of period			75,846						400,334
Unrestricted and restricted cash and cash equivalents at end of period			$	107,862					$	507,870
Supplemental disclosure of cash flow information:
Cash paid for interest (net of $0.7 million and $0.1 million capitalized in 2025 and 2024, respectively)			$	61,250					$	58,241
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases			$	1,713					$	1,803
Supplemental disclosure of noncash investing and financing activities:
Reclassifications to (from) redeemable noncontrolling interest from (to) additional paid in capital and noncontrolling interest			$	3,527					$	(13)
Leased assets obtained in exchange for new operating lease liabilities			$	2,727					$	—

See accompanying notes to the unaudited condensed consolidated financial statements.

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ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Unaudited)

(In thousands, except unit amounts)

ASSETS			March 31, 2025						December 31, 2024
Real estate investments:
Rental properties:
Land and land improvements			$	3,271,624					$	3,246,789
Buildings and improvements			14,505,983						14,342,729
			17,777,607						17,589,518
Less: accumulated depreciation			(6,171,689)						(6,150,618)
			11,605,918						11,438,900
Real estate under development			96,268						52,682
Co-investments			906,686						935,014
Real estate held for sale			112,173						—
			12,721,045						12,426,596
Cash and cash equivalents-unrestricted			98,735						66,795
Cash and cash equivalents-restricted			9,127						9,051
Marketable securities			76,013						69,794
Notes and other receivables, net of allowance for credit losses of $0.5 million as of both March 31, 2025 and December 31, 2024			133,724						206,706
Operating lease right-of-use assets			53,351						51,556
Prepaid expenses and other assets			94,263						96,861
Total assets			$	13,186,258					$	12,927,359
LIABILITIES AND CAPITAL
Unsecured debt, net			$	5,870,662					$	5,473,788
Mortgage notes payable, net			919,590						989,884
Lines of credit			—						137,945
Accounts payable and accrued liabilities			232,594						212,747
Construction payable			20,679						14,347
Distributions payable			173,678						165,443
Distributions in excess of investments in co-investments			84,295						79,273
Liabilities associated with real estate held for sale			641						—
Operating lease liabilities			54,149						52,473
Other liabilities			50,019						50,220
Total liabilities			7,406,307						7,176,120
Commitments and contingencies (Note 11)
Redeemable noncontrolling interest			34,376						30,849
Capital:
General Partner:
Common equity (64,358,097 and 64,280,466 units issued and outstanding, respectively)			5,554,381						5,512,391
			5,554,381						5,512,391
Limited Partners:
Common equity (2,283,494 and 2,331,251 units issued and outstanding, respectively)			69,653						73,418
Accumulated other comprehensive income, net			20,074						29,429
Total partners’ capital			5,644,108						5,615,238
Noncontrolling interest			101,467						105,152
Total capital			5,745,575						5,720,390
Total liabilities and capital			$	13,186,258					$	12,927,359

See accompanying notes to the unaudited condensed consolidated financial statements.

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ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Condensed Consolidated Statements of Income and Comprehensive Income

(Unaudited)

(In thousands, except unit and per unit amounts)

			Three Months Ended March 31,
			2025						2024
Revenues:
Rental and other property			$	462,089					$	424,215
Management and other fees from affiliates			2,494						2,713
			464,583						426,928
Expenses:
Property operating, excluding real estate taxes			86,027						79,578
Real estate taxes			52,594						46,920
Corporate-level property management expenses			12,332						11,099
Depreciation and amortization			151,287						139,733
General and administrative			16,292						17,171
Expensed acquisition and investment related costs			—						68
			318,532						294,569
Gain on sale of real estate and land			111,030						—
Earnings from operations			257,081						132,359
Interest expense			(62,732)						(55,933)
Total return swap income			1,200						796
Interest and other income			4,289						57,275
Equity income from co-investments			13,209						12,366
Tax benefit (expense) on unconsolidated co-investments			163						(49)
Loss on early retirement of debt			(762)						—
Gain on remeasurement of co-investment			330						138,326
Net income			212,778						285,140
Net income attributable to noncontrolling interest			(2,389)						(2,810)
Net income available to common unitholders			$	210,389					$	282,330
Comprehensive income			$	203,423					$	293,135
Comprehensive income attributable to noncontrolling interest			(2,389)						(2,810)
Comprehensive income attributable to controlling interest			$	201,034					$	290,325
Per unit data:
Basic:
Net income available to common unitholders			$	3.16					$	4.25
Weighted average number of common units outstanding during the period			66,621,852						66,463,899
Diluted:
Net income available to common unitholders			$	3.16					$	4.25
Weighted average number of common units outstanding during the period			66,656,852						66,470,819

See accompanying notes to the unaudited condensed consolidated financial statements.

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ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Condensed Consolidated Statements of Capital for the three months ended March 31, 2025 and 2024

(Unaudited)

(In thousands, except per unit amounts)

			General Partner																		Limited Partners												Accumulated other comprehensive income, net						Noncontrolling interest						Total
			Common Equity																		Common Equity
Three Months Ended March 31, 2025			Units						Amount									Units						Amount
Balances at December 31, 2024			64,280						$	5,512,391											2,331						$	73,418					$	29,429					$	105,152					$	5,720,390
Net income			—						203,110												—						7,279						—						2,389						212,778
Change in fair value of derivatives and amortization of swap settlements			—						—												—						—						(9,372)						—						(9,372)
Change in fair value of marketable debt securities			—						—												—						—						17						—						17
Issuance of common units under:
General partner’s stock based compensation, net			30						5,509												—						—						—						—						5,509
Equity based compensation costs			—						1,985												—						70						—						—						2,055
Changes in the redemption value of redeemable noncontrolling interest			—						(3,175)												—						(219)						—						(133)						(3,527)
Distributions to noncontrolling interest			—						—												—						—						—						(2,431)						(2,431)
Redemptions			48						(20)												(48)						(5,026)						—						(3,510)						(8,556)
Distributions declared ($2.57 per unit)			—						(165,419)												—						(5,869)						—						—						(171,288)
Balances at March 31, 2025			64,358						$	5,554,381											2,283						$	69,653					$	20,074					$	101,467					$	5,745,575

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			General Partner																		Limited Partners												Accumulated other comprehensive income, net						Noncontrolling interest						Total
			Common Equity																		Common Equity
Three Months Ended March 31, 2024			Units						Amount									Units						Amount
Balances at December 31, 2023			64,203						$	5,389,190											2,259						$	44,991					$	38,646					$	121,151					$	5,593,978
Net income			—						272,731												—						9,599						—						2,810						285,140
Change in fair value of derivatives and amortization of swap settlements			—						—												—						—						7,995						—						7,995
Issuance of common units under:
General partner's stock based compensation, net			6						962												—						—						—						—						962
Sale of common stock by general partner, net			—						(8)												—						—						—						—						(8)
Equity based compensation costs			—						1,637												—						58						—						—						1,695
Changes in the redemption value of redeemable noncontrolling interest			—						(180)												—						165						—						28						13
Distributions to noncontrolling interest			—						—												—						—						—						(2,875)						(2,875)
Redemptions			—						(249)												—						—						—						(30)						(279)
Distributions declared ($2.45 per unit)			—						(157,331)												—						(5,537)						—						—						(162,868)
Balances at March 31, 2024			64,209						$	5,506,752											2,259						$	49,276					$	46,641					$	121,084					$	5,723,753

See accompanying notes to the unaudited condensed consolidated financial statements.

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ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)

			Three Months Ended March 31,
			2025						2024
Cash flows from operating activities:
Net income			$	212,778					$	285,140
Adjustments to reconcile net income to net cash provided by operating activities:
Straight-lined rents			529						94
Depreciation and amortization			151,287						139,733
Amortization of discount and debt financing costs, net			220						2,341
Realized and unrealized gains on marketable securities, net			91						(3,351)
Provision for credit losses			(3)						47
Equity income from co-investments			(13,209)						(12,366)
Operating distributions from co-investments			13,709						9,080
Accrued interest from notes and other receivables			(2,593)						(3,953)
Gain on the sale of real estate and land			(111,030)						—
Equity-based compensation			1,958						1,592
Loss on early retirement of debt			762						—
Gain on remeasurement of co-investment			(330)						(138,326)
Changes in operating assets and liabilities:
Prepaid expenses, receivables, operating lease right-of-use assets, and other assets			2,996						(1,493)
Accounts payable, accrued liabilities, and operating lease liabilities			25,385						39,141
Other liabilities			(1,047)						(2,824)
Net cash provided by operating activities			281,503						314,855
Cash flows from investing activities:
Additions to real estate:
Acquisitions of real estate and acquisition related capital expenditures, net of cash acquired			(345,211)						(355,309)
Redevelopment			(12,046)						(11,417)
Development acquisitions of and additions to real estate under development			(7,856)						(1,348)
Capital expenditures on rental properties			(27,914)						(26,388)
Investments in notes receivable			—						(1,059)
Collections of notes and other receivables			3,096						—
Proceeds from insurance for property losses			848						301
Proceeds from dispositions of real estate			125,997						—
Contributions to co-investments			(3,934)						(2,074)
Changes in refundable deposits			(2,000)						—
Purchases of marketable securities			(6,306)						(163)
Sales and maturities of marketable securities			13						14
Non-operating distributions from co-investments			8,000						—
Net cash used in investing activities			(267,313)						(397,443)
Cash flows from financing activities:
Proceeds from unsecured debt and mortgage notes			398,416						349,132
Payments on unsecured debt and mortgage notes			(70,362)						(761)
Proceeds from lines of credit			550,897						—
Repayments of lines of credit			(688,842)						—
Additions to deferred charges			(3,055)						(2,692)

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			Three Months Ended March 31,
			2025						2024
Payments related to debt prepayment penalties			(697)						—
Net costs from issuance of common units			—						(8)
Net proceeds from stock options exercised			6,028						962
Payments related to tax withholding for share-based compensation			(519)						—
Distributions to noncontrolling interest			(2,333)						(2,163)
Redemption of noncontrolling interests			(8,556)						(279)
Common units distributions paid			(163,151)						(154,067)
Net cash provided by financing activities			17,826						190,124
Net increase in unrestricted and restricted cash and cash equivalents			32,016						107,536
Unrestricted and restricted cash and cash equivalents at beginning of period			75,846						400,334
Unrestricted and restricted cash and cash equivalents at end of period			$	107,862					$	507,870
Cash acquired in consolidation of co-investment
Supplemental disclosure of cash flow information:
Cash paid for interest (net of $0.7 million and $0.1 million capitalized in 2025 and 2024, respectively)			$	61,250					$	58,241
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases			$	1,713					$	1,803
Supplemental disclosure of noncash investing and financing activities:
Reclassifications to (from) redeemable noncontrolling interest from (to) general and limited partner capital and noncontrolling interest			$	3,527					$	(13)
Leased assets obtained in exchange for new operating lease liabilities			$	2,727					$	—

See accompanying notes to the unaudited condensed consolidated financial statements.

Table of Contents

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

(1) Organization and Basis of Presentation

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

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

The unaudited condensed consolidated financial statements for the three months ended March 31, 2025 and 2024 include the accounts of the Company and the Operating Partnership. Essex is the sole general partner of the Operating Partnership, with a 96.6% and 96.5% general partnership interest as of March 31, 2025 and December 31, 2024, respectively. Total Operating Partnership limited partnership units (“OP Units,” and the holders of such OP Units, “Unitholders”) outstanding were 2,283,494 and 2,331,251 as of March 31, 2025 and December 31, 2024, respectively, and the redemption value of the units, based on the closing price of the Company’s common stock totaled approximately $700.1 million and $665.4 million as of March 31, 2025 and December 31, 2024, respectively. The Company has reserved shares of common stock for such conversions.

As of March 31, 2025, the Company owned or had ownership interests in 258 operating apartment communities, comprising 62,772 apartment homes, excluding the Company’s ownership interests in preferred equity co-investments, loan investments, two operating commercial buildings, and a development pipeline consisting of one consolidated project. The operating apartment communities are located in Southern California (primarily Los Angeles, Orange, San Diego, and Ventura counties), Northern California (the San Francisco Bay Area) and the Seattle metropolitan area.

Recent Accounting Pronouncements

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

Accounting Pronouncements Adopted in the Current Year

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

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

Revenues and Gains on Sale of Real Estate and Land

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

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

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

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

Marketable Securities

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

Any unrealized gain or loss in debt securities classified as available for sale is recorded as other comprehensive income. Any realized and unrealized gains and losses in equity securities, realized gains in debt securities, and interest income are included in interest and other income in the condensed consolidated statements of income and comprehensive income. There were no other-than-temporary impairment charges for the three months ended March 31, 2025 and 2024.

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

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

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

			March 31, 2025
			Amortized Cost						Gross Unrealized Gain (Loss)						Carrying Value
Equity securities:
Investment funds - debt securities			$	2,676					$	(22)					$	2,654
Common stock, preferred stock and stock funds			49,247						17,881						67,128
Debt securities:
Available for sale
U.S. treasury securities			3,125						12						3,137
Corporate debt securities			3,089						5						3,094
Total - Marketable securities			$	58,137					$	17,876					$	76,013

			December 31, 2024
			Amortized Cost						Gross Unrealized Gain (Loss)						Carrying Value
Equity securities:
Investment funds - debt securities			$	2,645					$	(67)					$	2,578
Common stock, preferred stock and stock funds			49,195						18,021						67,216
Total - Marketable securities			$	51,840					$	17,954					$	69,794

Variable Interest Entities

In accordance with accounting standards for consolidation of variable interest entities (“VIEs”), the Company consolidated the Operating Partnership, 18 DownREIT entities (comprising nine communities), and four co-investments as of March 31, 2025. As of December 31, 2024, the Company consolidated the Operating Partnership, 18 DownREIT entities (comprising nine communities) and five co-investments. The Company consolidates these entities because it is the primary beneficiary. The Company has no assets or liabilities other than its investment in the Operating Partnership. The consolidated total assets and liabilities related to the above consolidated co-investments and DownREIT entities, net of intercompany eliminations, were $818.0 million and $243.9 million, respectively, as of March 31, 2025 and $893.0 million and $319.1 million, respectively, as of December 31, 2024. Noncontrolling interests in these entities was $101.4 million and $105.1 million as of March 31, 2025 and December 31, 2024, respectively. The Company’s financial risk in each VIE is limited to its equity investment in the VIE. As of March 31, 2025 and December 31, 2024, the Company did not have any VIEs of which it was not the primary beneficiary.

Equity-based Compensation

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

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

Fair Value of Financial Instruments

Management estimates that the carrying amounts of the outstanding balances under its lines of credit, and notes and other receivables approximate fair value as of March 31, 2025 and December 31, 2024, because interest rates, yields, and other terms for these instruments are consistent with interest rates, yields, and other terms currently available for similar instruments. Management has estimated that the fair value of the Company’s fixed rate debt with a carrying value of $6.2 billion and $5.8 billion as of March 31, 2025 and December 31, 2024, respectively, was approximately $5.9 billion and $5.5 billion, respectively. Management has estimated that the fair value of the Company’s $614.3 million and $752.3 million of variable rate debt at March 31, 2025 and December 31, 2024, respectively, was approximately $611.9 million and $749.4 million, respectively, based on the terms of existing mortgage notes payable, unsecured debt, and lines of credit compared to those available in the marketplace. Management estimated that the carrying amounts of cash and cash equivalents, restricted cash, accounts payable and accrued liabilities, construction payables, other liabilities and dividends payable approximate fair value as of March 31, 2025 and December 31, 2024 due to the short-term maturity of these instruments. Marketable securities are carried at fair value as of March 31, 2025 and December 31, 2024.

Capitalization of Costs

The Company’s capitalized costs related to development and redevelopment projects were comprised primarily of interest and employee compensation and totaled $6.2 million and $5.3 million during the three months ended March 31, 2025 and 2024, respectively. The Company amortizes the capitalized costs over the life of the development.

Co-investments

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

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

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

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

Changes in Accumulated Other Comprehensive Income, Net by Component

Essex Property Trust, Inc.

($ in thousands):

			Change in fair value and amortization of swap settlements						Unrealized gain on available for sale debt securities						Total
Balance at December 31, 2024			$	24,655					$	—					$	24,655
Other comprehensive loss before reclassification			(9,053)						16						(9,037)
Amounts reclassified from accumulated other comprehensive income			2						—						2
Other comprehensive loss			(9,051)						16						(9,035)
Balance at March 31, 2025			$	15,604					$	16					$	15,620

Essex Portfolio, L.P.

($ in thousands):

			Change in fair value and amortization of swap settlements						Unrealized gain on available for sale debt securities						Total
Balance at December 31, 2024			$	29,429					$	—					$	29,429
Other comprehensive loss before reclassification			(9,374)						17						(9,357)
Amounts reclassified from accumulated other comprehensive income			2						—						2
Other comprehensive loss			(9,372)						17						(9,355)
Balance at March 31, 2025			$	20,057					$	17					$	20,074

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

Redeemable Noncontrolling Interest

The carrying value of redeemable noncontrolling interests in the accompanying condensed consolidated balance sheets was $34.4 million and $30.8 million as of March 31, 2025 and December 31, 2024, respectively. The limited partners may redeem their noncontrolling interests for cash in certain circumstances.

The changes in the redemption value of redeemable noncontrolling interests for the three months ended March 31, 2025 is as follows ($ in thousands):

Balance at December 31, 2024			$	30,849
Reclassification due to change in redemption value and other			3,527
Balance at March 31, 2025			$	34,376

Cash, Cash Equivalents and Restricted Cash

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

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

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

			March 31, 2025						December 31, 2024						March 31, 2024						December 31, 2023
Cash and cash equivalents - unrestricted			$	98,735					$	66,795					$	499,036					$	391,749
Cash and cash equivalents - restricted			9,127						9,051						8,834						8,585
Total unrestricted and restricted cash and cash equivalents shown in the condensed consolidated statements of cash flows			$	107,862					$	75,846					$	507,870					$	400,334

Gain Contingencies

Contingencies, commonly resulting from legal settlements, will periodically arise that may result in a gain. Gain contingencies are typically not recognized in the financial statements until all uncertainties related to the contingency have been resolved. In the case of legal settlements, the Company determines that all uncertainties have been resolved when cash or other consideration has been received by the Company. During the three months ended March 31, 2024, the Company settled two lawsuits related to construction defects at two communities and received cash recoveries of $42.5 million. The Company determined that all uncertainties were resolved upon receipt of cash and recorded a gain. There were no material gains from legal settlements during the three months ended March 31, 2025.

Accounting Estimates

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

(2) Significant Transactions During the Three Months Ended March 31, 2025 and Subsequent Events

Significant Transactions

Acquisition of Real Estate Interests

Property Name						Location						Apartment Homes						Essex Ownership Percentage						Contract Price at Pro Rata Share
The Plaza						CA						307						100%						$	161.4
One Hundred Grand						CA						166						N/A						105.3			(1)
ROEN Menlo Park						CA						146						100%						78.8
Total acquisitions												619												$	345.5

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

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

Disposition of Real Estate Interests

Property Name						Location						Apartment Homes						Sale Price at Pro Rata Share
Highridge						CA						255						$	127.0		(1)
Total dispositions												255						$	127.0

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

Real Estate Assets Held for Sale

As of March 31, 2025, one community comprised of 350 apartment homes was classified as held for sale.

Preferred Equity Investments

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

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

Senior Unsecured Debt

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

Subsequent events

Subsequent to quarter end, the Company sold the held for sale property noted above for a contract price of $239.6 million.

In April 2025, the Company repaid its $500.0 million unsecured notes at maturity.

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

(3) Revenues

Disaggregated Revenue

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

			Three Months Ended March 31,
			2025						2024
Rental income			$	455,860					$	417,236
Other property			6,229						6,979
Management and other fees from affiliates			2,494						2,713
Total revenues			$	464,583					$	426,928

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

			Three Months Ended March 31,
			2025						2024
Southern California			$	188,622					$	168,890
Northern California			184,344						162,656
Seattle Metro			77,214						71,913
Other real estate assets (1)			11,909						20,756
Total rental and other property revenues			$	462,089					$	424,215

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

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

			Three Months Ended March 31,
			2025						2024
Same-property (1)			$	409,147					$	395,584
Acquisitions (2)			34,770						1,598
Non-residential/other, net (3)			18,560						27,096
Straight line rent concession (4)			(388)						(63)
Total rental and other property revenues			$	462,089					$	424,215

(1)Same-property includes properties that have comparable stabilized results as of January 1, 2024 and are consolidated by the Company for the three months ended March 31, 2025 and 2024. A community is considered to have reached stabilized operations once it achieves an initial occupancy of 90%.

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

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

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

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

Deferred Revenues and Remaining Performance Obligations

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

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in the revenue recognition accounting standard. As of March 31, 2025, the Company had $0.3 million of remaining performance obligations. The Company expects to recognize approximately 30% of these remaining performance obligations in 2025 and the remaining 70% through 2027.

(4) Co-investments

The Company has joint ventures which are accounted for under the equity method. The co-investments’ accounting policies are similar to the Company’s accounting policies. The co-investments typically own, operate, and develop apartment communities. Additionally, the Company has invested in five technology co-investments and, as of March 31, 2025, the co-investment balance of these investments was $62.7 million, and the aggregate commitment was $86.0 million. As of December 31, 2024, the Company had five technology co-investments and the co-investment balance of these investments was $57.3 million and the aggregate commitment was $86.0 million.

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

			Weighted Average Company Ownership Percentage (1)						March 31, 2025						December 31, 2024
Ownership interest in:
Wesco I, Wesco III, Wesco IV, Wesco V and Wesco VI (2)			54%						$	136,905					$	147,232
BEX IV and 500 Folsom			50%						143,953						146,142
Other (3)			53%						88,470						86,089
Total operating and other co-investments, net									369,328						379,463
Total preferred equity co-investments (includes related party investments of $49.3 million and $48.1 million as of March 31, 2025 and December 31, 2024, respectively. See Note 6, Related Party Transactions, for further discussion)									453,063						476,278
Total co-investments, net									$	822,391					$	855,741

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

(1)Weighted average company ownership percentages are as of March 31, 2025.

(2)As of March 31, 2025 and December 31, 2024, the Company’s investments in Wesco I, Wesco III, and Wesco IV were classified as a liability of $82.0 million and $77.2 million, respectively, due to distributions received in excess of the Company’s investment.

(3)As of March 31, 2025 and December 31, 2024, the Company’s investment in Expo was classified as a liability of $2.3 million and $2.0 million, respectively, due to distributions received in excess of the Company’s investment. The weighted average company ownership percentage excludes the Company’s investments in non-core technology co-investments which are carried at fair value.

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

			March 31, 2025						December 31, 2024
Combined balance sheets: (1)
Rental properties and real estate under development			$	3,938,493					$	4,094,826
Other assets			230,450						277,420
Total assets			$	4,168,943					$	4,372,246
Debt			$	2,856,849					$	3,001,303
Other liabilities			240,865						235,111
Equity			1,071,229						1,135,832
Total liabilities and equity			$	4,168,943					$	4,372,246

			Three Months Ended March 31,
			2025						2024
Combined statements of income: (1)
Property revenues			$	86,306					$	106,293
Property operating expenses			(32,702)						(42,314)
Net operating income			53,604						63,979
Interest expense			(27,301)						(40,943)
General and administrative			(4,206)						(7,563)
Depreciation and amortization			(36,587)						(45,793)
Net loss			$	(14,490)					$	(30,320)
Company’s share of net income (2)			$	13,209					$	12,366

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

(2)Includes the Company’s share of equity income from joint ventures and preferred equity investments, gain on sales of co-investments, co-investment promote income, and income from early redemption of preferred equity investments. Includes related party income of $1.2 million and $1.1 million for the three months ended March 31, 2025 and 2024, respectively.

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

(5) Notes and Other Receivables

Notes and other receivables consist of the following as of March 31, 2025 and December 31, 2024 ($ in thousands):

			March 31, 2025						December 31, 2024
Note receivable, secured, bearing interest at 9.00%, due October 2026 (Originated October 2021)			$	61,944					$	60,538
Note receivable, secured, bearing interest at 12.00%, due January 2025 (Originated August 2022)			—						3,167
Note receivable, secured, bearing interest at 11.25%, due October 2027 (Originated October 2022)			40,310						39,187
Receivable from preferred equity investment sponsor (1)			—						72,002
Other receivables from affiliates			5,344						5,646
Straight line rent receivables (2)			8,689						9,235
Other receivables			17,963						17,460
Allowance for credit losses			(526)						(529)
Total notes and other receivables			$	133,724					$	206,706

(1)In the fourth quarter of 2024, the Company repaid a $72.0 million senior mortgage associated with a preferred equity investment in Artizan, a 241-unit stabilized apartment home community located in Oakland, CA, and subsequently issued a default notice to the third-party sponsor in January 2025, assumed full managerial control and consolidated the property. Refer to Note 2, Significant Transactions During the three months ended March 31, 2025, for additional details.

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

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

			Three Months Ended March 31,
			2025																														2024
Balance at beginning of period			$	529																													$	687
Provision for credit losses			(3)																														25
Balance at end of period			$	526																													$	712

(6) Related Party Transactions

The Company charges certain fees relating to its co-investments for asset management, property management, development and redevelopment services. These fees from affiliates totaled $2.5 million and $2.8 million during the three months ended March 31, 2025 and 2024, respectively. All of these fees are net of intercompany amounts eliminated by the Company. The Company netted development and redevelopment fees of less than $0.1 million for the three months ended March 31, 2025 and $0.1 million for three months ended March 31, 2024, against general and administrative expenses.

The Company’s Chairman and founder, Mr. George M. Marcus, is the Chairman of the Marcus & Millichap Company (“MMC”), which is a parent company of a diversified group of real estate service, investment, and development firms. Mr. Marcus is also the Chairman of and owns a controlling interest in Marcus & Millichap, Inc. (“MMI”), a national brokerage firm listed on the New York Stock Exchange. For the three months ended March 31, 2025 and 2024, the Company did not pay brokerage commissions related to real estate transactions to MMI and its affiliates.

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

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

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

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

In May 2018, the Company made a commitment to fund a $26.5 million preferred equity investment in an entity whose sponsors include an affiliate of MMC. The entity wholly owns a 400-unit apartment home community located in Ventura, CA. The investment accrued interest based on a 10.25% initial preferred return. The investment was scheduled to mature in May 2023. In November 2021, the Company received cash of $18.3 million for the partial redemption of this preferred equity investment resulting in a remaining total commitment of $13.0 million, and the maturity was extended to December 2028. As of March 31, 2025, $11.0 million of this commitment was funded and the Company accrues interest based on a 9.0% preferred return. The remaining unfunded commitment of $2.0 million expired in November 2024.

The Company has provided short-term loans to affiliates. As of March 31, 2025 and December 31, 2024, $5.3 million and $5.6 million, respectively, of short-term loans remained outstanding due from joint venture affiliates and is classified within notes and other receivables in the accompanying condensed consolidated balance sheets.

(7) Debt

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

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

			March 31, 2025						December 31, 2024						Weighted Average Maturity In Years as of March 31, 2025
Term loan - variable rate, net			$	298,701					$	298,571					2.5
Bonds public offering - fixed rate, net (1)			5,571,961						5,175,217						6.9
Unsecured debt, net (2)			5,870,662						5,473,788
Lines of credit (3)			—						137,945
Mortgage notes payable, net (4)			919,590						989,884						6.3
Total debt, net			$	6,790,252					$	6,601,617
Weighted average interest rate on fixed rate unsecured bonds public offering			3.6		%				3.4		%
Weighted average interest rate on variable rate term loan			4.2		%				4.2		%
Weighted average interest rate on lines of credit			5.3		%				5.7		%
Weighted average interest rate on mortgage notes payable			4.1		%				4.2		%

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

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

(2)Unsecured debt, net, consists of fixed rate public bond offerings and a variable rate term loan which includes unamortized discounts, net of premiums of $1.2 million and unamortized premiums, net of discounts of $0.1 million, and unamortized debt issuance costs of $28.1 million and $26.3 million, as of March 31, 2025 and December 31, 2024, respectively.

(3)Lines of credit, related to the Company’s two lines of unsecured credit aggregating $1.28 billion as of both March 31, 2025, and December 31, 2024, excludes unamortized debt issuance costs of $5.8 million and $6.2 million as of March 31, 2025 and December 31, 2024, respectively. These debt issuance costs are included in prepaid expenses and other assets in the condensed consolidated balance sheets. As of March 31, 2025, the Company’s $1.2 billion credit facility had an interest rate at the Adjusted Secured Overnight Financing Rate (“Adjusted SOFR”) plus 0.765%, which is based on a tiered rate structure tied to the Company’s credit ratings, adjusted for the facility’s sustainability metric adjustment feature, and a scheduled maturity date of January 2029 with two six-month extensions, exercisable at the Company’s option. As of March 31, 2025, the Company’s $75.0 million working capital unsecured line of credit had an interest rate of the Adjusted SOFR plus 0.765%, which is based on a tiered rate structure tied to the Company’s credit ratings, adjusted for the facility’s sustainability metric adjustment feature, and a scheduled maturity date of July 2026.

(4)Includes total unamortized discounts, net of premiums of approximately $0.3 million and $0.2 million, reduced by unamortized debt issuance costs of $2.4 million and $2.6 million, as of March 31, 2025 and December 31, 2024, respectively.

The aggregate scheduled principal payments of the Company’s outstanding debt, excluding lines of credit, as of March 31, 2025 were as follows ($ in thousands):

2025			$	643,249
2026			644,405
2027			734,397
2028			518,332
2029			501,456
Thereafter			3,780,481
Total			$	6,822,320

(8) Segment Information

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

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

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

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

The revenues and NOI for each of the reportable operating segments are summarized as follows for the three months ended March 31, 2025 and 2024 ($ in thousands):

			Three Months Ended March 31,
			2025																		2024
			Rental and other property revenue						Property operating expenses, including real estate taxes						Net operating income						Rental and other property revenue						Property operating expenses, including real estate taxes						Net operating income
Southern California			$	188,622					$	54,630					$	133,992					$	168,890					$	49,733					$	119,157
Northern California			184,344						57,695						126,649						162,656						51,171						111,485
Seattle Metro			77,214						23,902						53,312						71,913						21,126						50,787
Other real estate assets			11,909						2,394						9,515						20,756						4,468						16,288
Total			$	462,089					$	138,621					$	323,468					$	424,215					$	126,498					$	297,717
Total net operating income															323,468																		297,717
Management and other fees from affiliates															2,494																		2,713
Corporate-level property management expenses															(12,332)																		(11,099)
Depreciation and amortization															(151,287)																		(139,733)
General and administrative															(16,292)																		(17,171)
Expensed acquisition and investment related costs															—																		(68)
Gain on sale of real estate and land															111,030																		—
Interest expense															(62,732)																		(55,933)
Total return swap income															1,200																		796
Interest and other income															4,289																		57,275
Equity income from co-investments															13,209																		12,366
Tax benefit (expense) on unconsolidated co-investments															163																		(49)
Loss on early retirement of debt															(762)																		—
Gain on remeasurement of co-investment															330																		138,326
Net income															$	212,778																	$	285,140

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

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

			March 31, 2025						December 31, 2024
Assets:
Southern California			$	4,124,581					$	4,275,506
Northern California			5,875,927						5,501,160
Seattle Metro			1,447,563						1,460,865
Other real estate assets (1)			157,847						201,369
Net reportable operating segments - real estate assets			11,605,918						11,438,900
Real estate under development			96,268						52,682
Co-investments			906,686						935,014
Real estate held for sale			112,173						—
Cash and cash equivalents, including restricted cash			107,862						75,846
Marketable securities			76,013						69,794
Notes and other receivables			133,724						206,706
Operating lease right-of-use assets			53,351						51,556
Prepaid expenses and other assets			94,263						96,861
Total assets			$	13,186,258					$	12,927,359

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

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

Essex Property Trust, Inc.

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

			Three Months Ended March 31, 2025																		Three Months Ended March 31, 2024
			Income						Weighted- average Common Shares						Per Common Share Amount						Income						Weighted- average Common Shares						Per Common Share Amount
Basic:
Net income available to common stockholders			$	203,110					64,314,899						$	3.16					$	272,731					64,205,086						$	4.25
Effect of Dilutive Securities:
Stock options			—						35,000												—						6,920
Diluted:
Net income available to common stockholders			$	203,110					64,349,899						$	3.16					$	272,731					64,212,006						$	4.25

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

The table above excludes from the calculations of diluted earnings per share weighted average convertible OP Units of 2,306,953 and 2,258,812, which include vested 2014 Long-Term Incentive Plan Units and 2015 Long-Term Incentive Plan Units, for the three months ended March 31, 2025 and 2024, respectively because they were anti-dilutive. The related income allocated to these convertible OP Units aggregated $7.3 million and $9.6 million for the three months ended March 31, 2025 and 2024, respectively.

Stock options of 177,196 and 395,585 for the three months ended March 31, 2025 and 2024, respectively, were excluded from the calculation of diluted earnings per share because the assumed proceeds per share of such options plus the average unearned compensation were greater than the average market price of the common stock for the periods ended and, therefore, were anti-dilutive.

Essex Portfolio, L.P.

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

			Three Months Ended March 31, 2025																		Three Months Ended March 31, 2024
			Income						Weighted- average Common Units						Per Common Unit Amount						Income						Weighted- average Common Units						Per Common Unit Amount
Basic:
Net income available to common unitholders			$	210,389					66,621,852						$	3.16					$	282,330					66,463,899						$	4.25
Effect of Dilutive Securities:
Stock options			—						35,000												—						6,920
Diluted:
Net income available to common unitholders			$	210,389					66,656,852						$	3.16					$	282,330					66,470,819						$	4.25

Stock options of 177,196 and 395,585 for the three months ended March 31, 2025 and 2024, respectively, were excluded from the calculation of diluted earnings per unit because the assumed proceeds per unit of these options plus the average unearned compensation were greater than the average market price of the common unit for the periods ended and, therefore, were anti-dilutive.

(10) Derivative Instruments and Hedging Activities

As of March 31, 2025, the Company had two interest rate swap contracts with an aggregate notional amount of $347.5 million. The Company has $300.0 million in notional amount that effectively fixed the interest rate on the Company’s $300.0 million unsecured term loan at 4.2%. The remaining $47.5 million in notional amount effectively converts $47.5 million of variable rate mortgage notes payable to an all-in fixed rate of 2.83%. These derivatives qualify for hedge accounting.

As of March 31, 2025 and December 31, 2024, the aggregate carrying value of the interest rate swap contracts was an asset of $3.4 million and $5.5 million, respectively, within prepaid expenses and other assets in the condensed consolidated balance sheets.

(11) Commitments and Contingencies

The Company is subject to various lawsuits in the normal course of its business operations. Such lawsuits have not had a material adverse effect on the Company’s financial condition, results of operations or cash flows. While no assurances can be given, the Company does not believe there is any pending or threatened litigation against the Company that, individually or in the aggregate, would reasonably be expected to have a material adverse effect on the Company.

ESSEX PROPERTY TRUST, INC. AND SUBSIDIARIES

ESSEX PORTFOLIO, L.P. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024

(Unaudited)

A number of purported 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. 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. The Company believes that, with respect to such matters that it is currently a party to, the ultimate disposition of any such matter will not result in a material adverse effect on the Company’s financial condition, results of operations or cash flows. To the extent that such a matter arises or is identified in the future that has other than a remote risk of having a material impact on the condensed consolidated financial statements, the Company will disclose the estimated range of possible outcomes associated with it, and, if an outcome is probable, accrue an appropriate liability for that matter. The Company will consider whether any such matter results in an impairment of value on the affected property and, if so, impairment will be recognized.

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