Vivmark Residential (VMRK) 10-K risk factor changes: FY2020 vs FY2019

| | • | National, regional and local political [removed: climates] [added: climates, governmental fiscal health] and governmental policies; |

| | • | Cost [added: and availability] of labor and materials required to maintain our properties at acceptable standards; |

Significant expenditures associated with each property, such as real estate taxes, insurance, utilities, maintenance costs and employee wages and benefits, may also negatively impact cash [removed: flows] [added: flows,] and [added: these expenditures may] not decline as quickly or at the same rate as revenues when circumstances might cause a reduction [added: of those revenues] at our properties.

The short-term nature of apartment leases [removed: expose] [added: exposes] us more quickly to the effects of declining market rents, potentially making our revenue more volatile.

[removed: Generally] [added: Generally,] our residential apartment leases are for twelve months or less.

Given our generally [removed: shorter term] [added: shorter-term] lease structure, our rental revenues are impacted by declines in market rents more quickly than if our leases were for longer terms.

If one or more of our markets is unfavorably impacted by specific economic conditions, local real estate conditions, increases in [added: social unrest, increases in] real estate and other taxes, [added: reduced quality of life, deterioration of local or state government health,] rent control or stabilization [removed: laws or] [added: laws,] localized environmental issues or natural/man-made disasters, the impact of such conditions may have a more negative impact on our results of operations than if our properties were more geographically diverse.

[removed: Additionally within] [added: Within] its primarily coastal markets, the Company is [removed: highly] [added: also] concentrated in certain dense urban and suburban submarkets.

To the extent that these [removed: particular] [added: markets or] submarkets [added: within these markets] become less desirable to operate in, including changes in multifamily housing supply and demand, our results of operations could be more negatively impacted than if we were more diversified within our [added: markets or invested in a greater number of] markets.

Development and [removed: renovations, in particular,] [added: renovations] are subject to greater uncertainties and risks due to complexities and lead time in estimating costs.

We may underestimate the costs necessary to operate an acquired property to the [removed: standards established for its intended market position.]

We may not be able to reconfigure our portfolio promptly in response to [added: changing] economic or other conditions.

A decline in the fair value of our assets may require us to recognize an impairment against [removed: such] [added: our] assets under accounting principles generally accepted in the United States (“GAAP”) if we were to determine that, with respect to any assets in unrealized loss positions, we do not have the ability and intent to hold such assets for a period of time sufficient to allow for recovery of the [removed: amortized] [added: depreciated] cost of such assets.

If such a determination were to be made, we would recognize unrealized losses through earnings and write-down the [removed: amortized] [added: depreciated] cost of such assets to a new cost basis, based on the fair value of such assets on the date they are considered to be impaired.

We may also experience an increase in costs due to general disruptions that affect the cost of labor and/or [removed: materials] [added: materials,] such as trade disputes, tariffs, labor unrest and/or geopolitical conflicts.

We may also be unable to obtain, or experience delays in obtaining, necessary zoning, occupancy, or other required governmental or [removed: third party] [added: third-party] permits and [added: authorizations.]

We [removed: currently] [added: currently,] and may continue to in the [removed: future] [added: future,] develop and acquire properties in joint ventures with other persons or entities.

| | • | The possibility that our partners might refuse [added: or be financially unable] to make capital contributions when due and therefore we may be forced to make contributions to protect our investments; |

We and our respective joint venture partners may each have the right to trigger a buy-sell arrangement that could cause us to sell our interest, or acquire our partner's interest, at a time [removed: when we otherwise would not have initiated such a transaction.][added: or price that is unfavorable to us.]

Dislocations and disruptions in capital markets could result in increased costs or lack of availability of debt financing (including under our [removed: $1.0 billion] commercial paper program) and equity financing.

In addition, a downgrade below investment grade would [added: likely cause us to lose access to the commercial paper markets and would] require us to post cash collateral and/or letters of credit in favor of some of our secured lenders to cover our self-insured property and liability insurance deductibles or to obtain lower deductible insurance compliant with the lenders’ requirements at the lower ratings level.

[removed: *The] [added: The] occurrence of cyber [removed: incidents,* *or] [added: incidents, or] a deficiency in our cybersecurity, could negatively impact our business by causing a disruption to our operations, a compromise or corruption of our confidential information, and/or damage to our reputation and business relationships, all of which could negatively impact our financial [removed: results.*][added: results.]

Despite system redundancy, the implementation of security measures, required employee awareness training and the existence of a disaster recovery plan for our internal information technology systems, our systems and systems maintained by [removed: third party] [added: third-party] vendors with which we do business are vulnerable to damage from any number of sources.

We face risks associated with security breaches, whether through cyber attacks or cyber intrusions over the Internet, malware, computer viruses, attachments to emails, phishing [removed: attempts] [added: attempts, ransomware] or other scams, persons inside our organization or persons/vendors with access to our systems and other significant disruptions of our information technology networks and related systems, including property infrastructure.

In addition, we engage [removed: third party] [added: third-party] service providers that may have access to such personally identifiable information in connection with providing necessary information technology, security and other business services to us.

The systems of our [removed: third party] [added: third-party] service providers may contain defects in design or other problems that could unexpectedly compromise personally identifiable information.

Although we make efforts to maintain the security and integrity of our information technology networks and those of our [removed: third party] [added: third-party] providers and we have implemented various measures to manage the risk of a security breach or disruption, there can be no assurance that our security efforts and measures will be effective or that attempted security breaches or disruptions would not be successful or damaging.

A breach or significant and extended disruption in the function of our systems, including our primary website, could damage our reputation and cause us to lose residents and revenues, result in a violation of applicable privacy and other laws, generate [removed: third party claims, result in the unintended and/or unauthorized public disclosure or the misappropriation of proprietary, personally identifiable and confidential information and require us to incur significant expenses to address and remediate or otherwise resolve these kinds of issues.][added: third-party]

[removed: *Insurance] [added: Insurance] policies can be costly and may not cover all losses, which may adversely affect our financial condition or results of [removed: operations.*][added: operations.]

The Company relies on [removed: third party] [added: third-party] insurance providers for its property, general liability, workers compensation and other insurance, and should any of them experience liquidity issues or other financial distress, it could negatively impact their ability to pay claims under the Company’s policies.

Catastrophic weather [added: and natural disaster] risk: Our properties may be located in areas that could experience catastrophic weather and other natural disasters from time to time, including wildfires, snow or ice storms, windstorms or hurricanes, flooding or other severe [removed: weather.][added: disasters.]

[removed: This] [added: These] severe weather and natural disasters could cause substantial damages or losses to our properties which may not be covered or could exceed our insurance coverage.

This includes the Ownership Limit described [removed: below in this Item 1A.][added: above.]

The adoption of, or changes, in rent control or rent stabilization [removed: laws and] regulations and eviction [removed: laws and] regulations in our markets could have an adverse effect on our operations and property values.

[removed: Various] [added: A growing number of] state and local governments have enacted and may continue to [removed: enact] [added: consider enacting and/or expanding] rent control or rent stabilization [removed: laws and regulations] [added: regulations,] which [added: have limited and] could [added: continue to] limit [added: in broadening ways] our ability to raise rents or charge certain fees, either of which could have a retroactive effect.

We continue to see increases in governments considering or being urged by advocacy groups to consider rent [added: forgiveness, rent] control or rent stabilization [added: regulations or expand coverage of existing regulations in our markets.]

These regulations may also make changes to [added: and/or expand] eviction and other tenants’ rights [removed: laws and] regulations that [added: may limit our ability to enforce residents’ or tenants’ contractual rental obligations (such as eviction moratoriums), pursue collections or charge certain fees, which] could have an adverse impact on our operations and property values.

Our properties are subject to various federal, state and local regulatory requirements, such as state and local fire and life safety [removed: requirements] [added: requirements, building] and [added: zoning codes and] federal, state and local accessibility requirements, including and in addition to those imposed by the Americans with Disabilities Act and the Fair Housing Act.

[removed: Environmental] [added: *Environmental] problems are possible and can be [removed: costly.][added: costly.*]

If we fail to qualify as a REIT, we would be subject to [added: U.S.] federal income tax at regular corporate rates (including, for years prior to 2018, any alternative minimum tax) and would have to pay significant income taxes unless the Internal Revenue Service (“IRS”) granted us relief under certain statutory provisions.

Risks Related to the COVID-19 Pandemic

The ongoing COVID-19 pandemic and measures intended to prevent its spread could have a material adverse effect on our business, results of operations, cash flows and financial condition.

In March 2020, the World Health Organization declared COVID-19 a pandemic.

The outbreak has led governments and other authorities around the world, including federal, state and local authorities in the United States, to impose measures intended to control its spread, including restrictions on movement and business operations such as travel bans, border closings, business closures, quarantines, social distancing and shelter-in-place orders.

The COVID-19 pandemic has also caused, and may likely continue to cause, severe economic, market and other disruptions worldwide.

There can be no assurance that conditions will not continue to deteriorate as a result of the pandemic.

The impact of the COVID-19 pandemic and measures to prevent its spread could materially negatively impact our business, results of operations, financial condition and liquidity in a number of ways, including:

| | • | A decrease in our rental revenues or increase in related reserves and write-offs as a potential result of: |

| | • | The deterioration of global economic conditions as a result of the pandemic may ultimately decrease occupancy levels and pricing across our portfolio as residents reduce or defer their spending; |

| | • | Our residents’ and tenants’ ability to pay their rent on time or at all; |

| | • | Changes in the demand for multifamily properties within our markets; |

| | • | Our geographic concentrations, especially in our dense urban communities which often makes social distancing more difficult, may experience longer periods of economic disruption due to delays in business re-openings and/or required re-closures, as a result of which we may be more susceptible to the impact of COVID-19; |

| | • | Changes in resident preferences, including changes due to increased employer flexibility to work from home, making current or prospective residents less likely to want to live in dense urban centers where we own many of our properties or to want to live in denser forms of multifamily housing like the high-rise or mid-rise housing the Company owns; |

| | • | The concessions made, and those that continue to be made, to residents’ rent obligations, which may not be on terms as favorable to us as those currently in place; |

| | • | The costs we may incur in protecting our investments and releasing our properties as a result of resident or tenant nonpayment, default or bankruptcy; |

| | • | The risk that local and national authorities may expand or extend certain measures imposing restrictions on our ability to enforce residents’ or tenants’ contractual rental obligations (such as eviction moratoriums or rental forgiveness) and limit our ability to raise rents or charge certain fees; |

| | • | The risk that local and national authorities may not pass, extend or may reduce government stimulus and relief programs which may be providing or would provide benefits to our residents (or employers of our residents) and tenants; |

| | • | Restrictions inhibiting our employees’ ability to meet with existing and potential residents has disrupted and could in the future further disrupt our ability to lease apartments which could adversely impact our rental rate and occupancy levels; and |

| | • | Non-residential operations in our apartment buildings are particularly vulnerable to the effects from the COVID-19 pandemic, which we expect may adversely impact their operations and, in turn, could result in an increase in tenant/garage operator defaults, rent deferrals/abatements and rent reductions. |

| | • | Our properties may also incur significant operating expenses related to shelter-in-place orders, quarantines and social distancing requirements, such as higher cleaning or other related costs; |

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

| | • | The risk that our access to capital at attractive terms may be diminished due to, among other factors: (i) potential disruptions in the long-term debt and commercial paper markets; (ii) the risk that a prolonged economic slowdown or recession could negatively impact our lending counterparties; and (iii) reductions in the Company’s credit ratings as a result of a protracted and more severe deterioration in our operations due to the pandemic; |

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

| | • | The risk of a prolonged outbreak and/or multiple waves of an outbreak of the pandemic: |

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

| | a) | could cause long-term damage to economic conditions, which in turn could cause material declines in the fair value of our assets, leading to asset impairment charges; and, |

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

| | b) | could cause an adverse impact on our future financial results, cash flows and financial condition and therefore our ability to pay dividends; |

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

| | • | A general decline in the real estate market or demand for real estate transactions could hinder our ability to acquire or dispose of properties, including through our joint ventures; |

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

| | • | The risk of delays in our development and renovation projects due to construction moratoriums, governmental movement restrictions, social distancing requirements, the closure of many permitting and inspection agencies and disruptions in the supply of construction materials or other products due to problems in the supply chain or otherwise; |

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

| | • | A possible further decline in the price of our common shares due to a prolonged economic recession or other impacts described herein; |

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

| | • | Increased risks of potential cyber attacks due to an increased reliance on remote working and other electronic interactions with our current and prospective residents; and |

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

| | • | Potential inability to maintain adequate staffing at our properties and corporate/regional offices due to shelter-in-place orders, an outbreak at one or more of our properties or corporate/regional offices and/or the continued duration or expansion of the pandemic. |

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

The extent of the COVID-19 pandemic’s effect on our operational and financial performance will depend on future developments including the duration, spread and intensity of the outbreak and the rollout and effectiveness of vaccines, all of which are uncertain and difficult to predict.

The Company’s properties are highly concentrated in our primarily coastal markets.

authorizations.

General Risks

laws and regulations.

In June 2019, the State of New York enacted rent control regulations known as the Housing Stability and Tenant Protection Act of 2019.

In October 2019, the State of California enacted rent control regulations known as the Tenant Protection Act of 2019.

However, REITs

are also permitted to limit the amount of cash paid to all shareholders to 20% of the total dividend paid.

Forward-looking statements [removed: in this Item 7 as well as elsewhere in this Annual Report on Form 10-K] are intended to be made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Many of these uncertainties and risks are difficult to predict and beyond management’s [removed: control.][added: control, such as the current COVID-19 pandemic (see below for further discussion).]

[removed: Factors] [added: Additional factors] that might cause such differences are discussed in Part I of this Annual Report on Form 10-K, particularly those under Item 1A, *Risk Factors*.

The [removed: 2020] [added: 2021] guidance assumptions disclosed throughout this Item 7 are based on current expectations and are forward-looking.

[removed: Results] [added: Results] of [removed: Operations][added: Operations]

[removed: 2019] [added: 2020] and [removed: 2018] [added: 2019] Transactions

[removed: The] [added: In conjunction with our business objectives and operating and investing strategies, the] following tables provide a rollforward of the transactions that occurred during the years ended December 31, [removed: 2019] [added: 2020] and [removed: 2018:][added: 2019:]

[removed: Portfolio Rollforward][added: Portfolio Rollforward]

| Land Parcels | | | — | | | | — | | | $ | [removed: (2,700] [added: (55,510] | ) | | | | |

The consolidated properties disposed of were located in the [removed: Seattle, Los Angeles] [added: Phoenix, San Diego, San Francisco] and [removed: New York] [added: Washington D.C.] markets and the sales generated an Unlevered IRR of [removed: 8.7%.][added: 10.2%.]

See [removed: also] Note 4 in the Notes to Consolidated Financial Statements for additional discussion regarding the Company’s real estate transactions.

The Company’s guidance assumes consolidated rental acquisitions [removed: of $1.25 billion and] [added: will be approximately equal to] consolidated rental dispositions [removed: of $1.0 billion, and the Company expects that the Acquisition Cap Rate will be 0.25% lower than the Disposition Yield] for the full year ending December 31, [removed: 2020.][added: 2021.]

We currently budget spending approximately [removed: $365.0] [added: $220.0] million on development costs during the year ending December 31, [removed: 2020 (inclusive of approximately $50.0 million of construction mortgage and joint venture partner obligations),] [added: 2021,] primarily for properties currently under construction.

Properties that the Company owned and were stabilized (see definition below) for all of both [removed: 2019] [added: 2020] and [removed: 2018] [added: 2019] (the [removed: “2019] [added: “2020] Same Store Properties”), which represented [removed: 71,830] [added: 73,585] apartment units, impacted the Company’s results of operations.

The [removed: 2019] [added: 2020] Same Store Properties are discussed in the following paragraphs.

The following tables provide a rollforward of the apartment units included in Same Store Properties and a reconciliation of apartment units included in Same Store Properties to those included in Total Properties for the year ended December 31, [removed: 2019:][added: 2020:]

| | | Year Ended December 31, [removed: 2019] | | | | | | | [added: | | | |]

| Same Store Properties at December 31, [removed: 2018] [added: 2020] | | | [removed: 281] [added: 285] | | | | [removed: 71,721] [added: 73,585] | |

| 2017 acquisitions | | | 2 | | | | [removed: 437] [added: 510] | |

| Lease-up properties stabilized | | | 5 | | | | [removed: 1,652] [added: 2,015] | |

| Other | | | [removed: — | | | | 25] [added: 0.04] | |

| Master-Leased properties [removed: (2)] [added: (1)] | | | 1 | | | | 162 | |

| Lease-up properties not yet stabilized [removed: (3)] [added: (2)] | | | [removed: 8] [added: 3] | | | | [removed: 2,458] [added: 443] | |

| Total Non-Same Store | | | [removed: 30] [added: 19] | | | | [removed: 8,132] [added: 4,304] | |

| Total Properties and Apartment Units | | | [removed: 309] [added: 304] | | | | [removed: 79,962] [added: 77,889] | |

| [removed: (2)] [added: (1)] | Consists of one property containing 162 apartment units that is wholly owned by the Company where the entire project is master-leased to a [removed: third party] [added: third-party] corporate housing provider. |

| [removed: (3)] [added: (2)] | Consists of properties in various stages of lease-up and properties where lease-up has been completed but the properties were not stabilized for the comparable periods presented. [removed: Also includes two former master-leased properties that were not stabilized for the comparable periods presented.] |

The following table provides comparative [added: total] same store results and statistics for the [removed: 2019] [added: 2020] Same Store Properties:

[removed: 2019] [added: 2020] vs. [removed: 2018][added: 2019]

Same Store Results/Statistics [removed: for 71,830] [added: Including 73,585] Same Store Apartment Units

| [removed: Description] [added: Markets/Metro Areas] | | [added: Apartment Units | | | | 2020 % of Actual NOI | | | | 2020 Average Rental Rate | | | | 2020 Weighted Average Physical Occupancy % | | | | 2020 Turnover | | | |] Revenues | | | | Expenses | | | | NOI | | | | Average Rental Rate [removed: (1)] | | | | Physical Occupancy [removed: (2)] | | | | Turnover [removed: (3)] | | | [removed: | |]

Note: Same store revenues for all leases are reflected on a [removed: straight line] [added: straight\-line] basis in accordance with GAAP for the current and comparable periods.

| [removed: (1)] | [added: • |] Average Rental Rate – Total [removed: residential] [added: Residential] rental revenues reflected on a straight-line basis in accordance with GAAP divided by the weighted average occupied apartment units for the reporting period presented. |

| [removed: (2)] | [added: • |] Physical Occupancy – The weighted average occupied apartment units for the reporting period divided by the average of total apartment units available for rent for the reporting period. |

| [removed: (3)] | [added: • |] Turnover – Total [removed: residential] [added: Residential] move-outs (including inter-property and intra-property transfers) divided by total [removed: residential] [added: Residential] apartment units. |

The following tables present reconciliations of operating income per the consolidated statements of operations to NOI, along with rental income, operating expenses and NOI per the consolidated statements of operations allocated between same store and non-same store results [removed: for the 2019 Same Store Properties] (amounts in thousands):

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

| Property management | | | [removed: 95,344] [added: 93,825] | | | | [removed: 92,485] [added: 95,344] | |

| General and administrative | | | [removed: 52,757] [added: 48,305] | | | | [removed: 53,813] [added: 52,757] | |

| Depreciation | | | [added: 820,832 | | | |] 831,083 | | | | 785,725 | |

In addition, please refer to the Definitions section below for various capitalized terms not immediately defined in this Item 7, *Management’s Discussion and Analysis of Financial Condition and Results of Operations*.

In addition, these forward-looking statements are subject to risks related to the COVID-19 pandemic, many of which are unknown, including the duration and severity of the pandemic, the extent of the adverse health impact on the general population and on our residents, customers and employees in particular, its impact on the employment rate and the economy and the corresponding impact on our residents’ and tenants’ ability to pay their rent on time or at all, the impact on resident housing preferences especially for urban apartment living, the extent and impact of governmental responses, the rollout and effectiveness of vaccines and the impact of operational changes we have implemented and may implement in response to the pandemic.

COVID-19 Impact

On March 11, 2020, the World Health Organization declared the outbreak of COVID-19 a pandemic.

The continued rapid development and fast-changing nature of the COVID-19 pandemic creates many unknowns that have had and could continue to have a significant future impact on the Company.

Its duration, severity and the extent of the adverse health impact on the general population, our residents and employees, the rollout and effectiveness of vaccines and the potential long-term changes in customer preferences for living in our communities, are among the many unknowns.

These, among other items, have impacted the economy, the unemployment rate and our operations and could materially affect our future consolidated results of operations, financial condition, liquidity, investments and overall performance.

For additional details, see Item 1A, *Risk Factors*.

We have been supporting our residents and employees during the COVID-19 pandemic by:

| | • | Utilizing technology to allow our property teams to interact remotely with current and prospective residents, including a new touchless leasing process and a service process designed to limit in-person contact; |

| | • | Successfully implementing changes to the physical layout of our properties and remaining focused on further enhancing our existing commitment to health and safety during the pandemic; |

| | • | Continuing to provide additional paid leave for employees impacted by the pandemic and in 2020 paid special bonuses to certain on-site employees in recognition of their significant efforts; |

| | • | Continuing to support our corporate and regional employees by allowing them to work remotely during the pandemic; and |

| | • | Offering an extensive outreach process for residents and tenants financially impacted by the pandemic, including creating payment plans to assist them, among other support efforts. |

While the pandemic remains a significant health threat, cities continue to work towards safely re-opening their economies and to managing closures in ways that create the least amount of economic impact.

We expect that employers will bring back employees to their offices deliberately and safely.

We believe proximity to employment and to entertainment and social amenities in urban centers will continue to have value.

Employers also continue to invest in the future, committing to long-term office obligations in our markets where they continue to create collaborative work environments.

During the year ended December 31, 2020, the Company collected approximately 97% of its expected Residential revenues in the second, third and fourth quarters of 2020.

We believe that 2021 will be a year of recovery for the Company.

Operating trends are improving and we believe that the first half of 2021 will be the low point in our financial results.

Our affluent, well-employed resident base remains drawn to our nation’s great cities and we expect demand to accelerate and pricing to continue to improve as vaccines are widely administered and cities become more active.

| Consolidated Rental Properties – Not Stabilized (1) | | | 1 | | | | 158 | | | $ | 48,860 | | | | 4.7 | % |

| Rental Properties | | | (6 | ) | | | (2,231 | ) | | $ | (1,066,861 | ) | | | (4.5 | )% |

| 12/31/2020 | | | 304 | | | | 77,889 | | | | | | | | | |

| (1) | The Company acquired one property in the third quarter of 2020 that is in lease-up and is expected to stabilize in its second year of ownership. |

The consolidated property acquired was located in the Seattle market.

| 12/31/2019 | | | 309 | | | | 79,962 | | | | | | | | | |

Certain of these costs are expected to be funded by third-party construction mortgages and joint venture partner obligations.

Work at all of our development projects continues with no material delays after some construction disruptions due to COVID-19.

| 2020 dispositions | | | (6 | ) | | | (2,231 | ) |

| Same Store | | | 285 | | | | 73,585 | |

| 2020 acquisitions | | | 1 | | | | 158 | |

| Operating income | | $ | 1,317,990 | | | $ | 1,356,160 | |

| Depreciation | | | 820,832 | | | | 831,083 | |

| Same store | | $ | 2,419,018 | | | $ | 2,519,235 | |

| Same store | | | 773,479 | | | | 757,502 | |

| Same store | | | 1,645,539 | | | | 1,761,733 | |

| Non-same store/other | | | 103,606 | | | | 125,974 | |

| Total NOI | | $ | 1,749,145 | | | $ | 1,887,707 | |

In conjunction with our business objectives and operating strategy, the Company continued to invest in apartment properties located primarily in our urban and high-density suburban communities and sell apartment properties that we believe will have inferior long-term returns.

| 12/31/2018 | | | 307 | | | | 79,482 | | | | | | | | | |

| Consolidated: | | | | | | | | | | | | | | | | |

| 12/31/2017 | | | 305 | | | | 78,611 | | | | | | | | | |

| Rental Properties | | | 5 | | | | 1,478 | | | $ | 707,005 | | | | 4.4 | % |

| Rental Properties | | | (5 | ) | | | (1,292 | ) | | $ | (706,120 | ) | | | (4.1 | )% |

| Completed Developments – Consolidated | | | 2 | | | | 671 | | | | | | | | | |

| Configuration Changes | | | — | | | | 14 | | | | | | | | | |

The consolidated properties acquired were located in the Seattle, New York, Denver and Boston markets.

The consolidated properties development completions were located in the San Francisco and Washington D.C. markets.

Finally, the Company started construction on one consolidated project, located in the Boston market, consisting of 469 apartment units totaling approximately $409.7 million of expected development costs.

See the Definitions section below for the definition of Acquisition Cap Rate, Development Yield, Disposition Yield and Unlevered IRR.

| 2019 dispositions | | | (11 | ) | | | (2,361 | ) |

| Properties added back to same store (1) | | | 2 | | | | 356 | |

| Same Store | | | 279 | | | | 71,830 | |

| 2017 acquisitions – not stabilized | | | 2 | | | | 510 | |

| (1) | Consists of two properties which were added back to the same store portfolio as discussed further below: |

| | a. | Playa Pacifica in Hermosa Beach, California containing 285 apartment units was removed from the same store portfolio in the first quarter of 2015 due to a major renovation in which significant portions of the property were taken offline for extended time periods. Playa Pacifica was added back to same store for the year ended December 31, 2019 as the property achieved greater than 90% occupancy for all of the current and comparable periods presented. |

| | b. | Acton Courtyard in Berkeley, California containing 71 apartment units was removed from the same store portfolio in the third quarter of 2016 due to an affordable housing dispute which required significant portions of the property to be vacant for an extended re-leasing period. Acton Courtyard was added back to same store for the year ended December 31, 2019 as the property achieved greater than 90% occupancy for all of the current and comparable periods presented. |

| | | Results | | | | | | | | | | | | Statistics | | | | | | | | | | | | |

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

| 2019 | | $ | 2,453,259 | | | $ | 734,553 | | | $ | 1,718,706 | | | $ | 2,843 | | | | 96.4 | % | | | 49.5 | | % | |

| 2018 | | $ | 2,377,066 | | | $ | 708,616 | | | $ | 1,668,450 | | | $ | 2,762 | | | | 96.2 | % | | | 51.4 | | % | |

| Change | | $ | 76,193 | | | $ | 25,937 | | | $ | 50,256 | | | $ | 81 | | | | 0.2 | % | | | (1.9 | | %) | |

| Change | | | 3.2 | % | | | 3.7 | % | | | 3.0 | % | | | 2.9 | % | | | | | | | | | | |

| Operating income | | $ | 1,356,544 | | | $ | 1,115,370 | |

| Fee and asset management revenue | | | (384 | ) | | | (753 | ) |

| Same store | | $ | 2,453,259 | | | $ | 2,377,066 | |

| Same store | | | 734,553 | | | | 708,616 | |

| Same store | | | 1,718,706 | | | | 1,668,450 | |

| Non-same store/other | | | 169,001 | | | | 122,082 | |

The Company anticipates the following same store results for the full year ending December 31, 2020, which assumptions are based on current expectations and are forward-looking:

| 2020 Same Store Assumptions | | | |

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

| Revenue change | | 2.3% to 3.3% | |

| NOI change | | 1.5% to 3.5% | |

| Markets/Metro Areas | | Actual Full Year 2019 Same Store Revenue Growth | | | Projected Full Year 2020 Same Store Revenue Growth |

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

| Boston | | 4.0% | | | 2.6% to 3.6% |

| New York | | 2.3% | | | 2.1% to 3.1% |

Additionally, we have exposure to long-term interest rates, particularly U.S. Treasuries as they are utilized to price our [removed: long term] [added: long-term] borrowings and therefore affect the cost of refinancing existing debt or incurring additional debt.

The Company had total variable rate debt of [removed: $1.4] [added: $0.8] billion, representing [removed: 15.3%] [added: 10.0%] of total debt, and $1.4 billion, representing [removed: 16.4%] [added: 15.3%] of total [removed: debt] [added: debt,] as of December 31, [removed: 2019] [added: 2020] and [removed: 2018,] [added: 2019,] respectively.

If interest rates had been 100 basis points higher in [removed: 2019] [added: 2020] and [removed: 2018] [added: 2019] and average balances coincided with year end balances, our annual interest expense would have been [removed: $13.8] [added: $8.1] million and [removed: $14.5] [added: $13.8] million higher, respectively.

As of December 31, [removed: 2018,] [added: 2020,] the Company had total outstanding fixed rate debt of [removed: $7.4] [added: $7.2] billion, or [removed: 83.6%] [added: 90.0%] of total debt, with an estimated fair market value of [removed: $7.4] [added: $8.2] billion.

If interest rates had been 100 basis points lower as of December 31, [removed: 2018,] [added: 2020,] the estimated fair market value would have increased by approximately [removed: $514.3] [added: $686.6] million.

The Company had no outstanding derivative instruments as of December 31, 2019 and had derivative instruments with a net liability fair value of approximately $10.1 million as of December 31, 2018.

If interest rates had been 27 basis points (representing 10% of the weighted average of the then prevailing market rates) lower on December 31, 2018, the liability would have increased by approximately $11.3 million.

EQR is the general partner of, and as of December 31, [removed: 2019] [added: 2020] owned an approximate 96.4% ownership interest in, ERPOP.

You may access our Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q, our Current Reports on Form [removed: 8-K] [added: 8-K, our proxy statements] and any amendments to any of those [removed: reports] [added: reports/statements] we file with the Securities and Exchange Commission (“SEC”) free of charge on our website, www.equityapartments.com.

The Company is one of the largest U.S. publicly-traded owners [added: and operators] of [added: high-quality] rental [removed: apartments] [added: apartment properties] with a portfolio [removed: of properties] primarily located in [added: urban and dense suburban communities in and around] Boston, New York, Washington, D.C., [removed: Seattle, San Francisco,] Southern California (including Los Angeles, Orange County and San [removed: Diego)] [added: Diego), San Francisco, Seattle] and Denver.

Our markets continue to [removed: draw skilled] [added: be the primary] knowledge [added: centers of the U.S. economy drawing the talented] workers [added: and employers] that drive economic growth in the United States.

Our employees are focused on delivering remarkable customer service to our residents so they will stay with us longer, be willing to pay higher rent for a great experience and will tell [removed: their friends] [added: others] about how much they love living in an Equity Residential property.

[removed: Increasingly, we are using] [added: We utilize] technology [added: and other innovative methods of engagement] to [added: foster relationships and community,] improve [removed: this] [added: the] resident experience and [removed: to] operate our business more efficiently.

Our disciplined balance sheet management enhances returns and value creation while maintaining [removed: capacity] [added: flexibility] to take advantage of future opportunities.

[removed: We are committed] [added: It drives our commitment] to sustainability, diversity and inclusion, [removed: the] total well-being of our employees and being a responsible corporate citizen in the communities in which we [removed: operate.][added: operate, which is especially relevant when we face unprecedented challenges like the novel coronavirus (“COVID-19”) pandemic.]

[removed: *Investment Strategy*][added: Investment Strategy]

The [removed: Company invests] [added: Company’s long-term strategy is to invest] in apartment communities located in strategically targeted markets [removed: (primarily urban and high-density suburban locations)] with the goal of maximizing our risk-adjusted total returns by balancing current cash flow generation with long-term capital appreciation.

[removed: These] [added: The] markets [added: we focus on] generally feature one or more of the following characteristics that allow us to drive performance:

| | • | Strong [added: generators of] economic growth [added: often characterized] as centers of the knowledge-based economy, leading to high wage job growth and household formation, which in turn leads to high demand for our apartments; |

| | • | Strong [added: other] demand drivers. |

We believe our strategy capitalizes on the [removed: increasing] preference of renters of all ages to live in the [removed: urban core of cities or dense suburban] locations [added: where we operate that typically are] near [removed: transit,] [added: to transportation (both public transit and convenient highway access),] entertainment and cultural amenities.

[removed: Currently demand] [added: Demand] for rental housing is driven primarily by household formations from the Millennial segment [removed: of our population, also known as the Echo Boom Generation, that now comprises] [added: and increasingly from] the [removed: largest] [added: Generation Z] segment of [removed: the U.S.] [added: our] population.

[removed: These young adults,] [added: Millennials,] born between 1981 and 2000, [removed: currently] total approximately 78 million people and are disproportionately renters.

[removed: We] [added: They] also [removed: expect this demographic] [added: tend] to remain renters longer due to societal trends favoring delays in marriage and having children.

We believe we will continue to see demand from this group, as the largest sub-segment of this cohort is now turning [removed: 29] [added: 30] years old while the median age of our resident is 33 years old.

[removed: Following] [added: After] the [removed: Millenials is] [added: Millennials comes] Generation Z, which comprises the more than 70 million people born between 2001 and 2014.

[removed: We] [added: Once it subsides, we] believe we are extremely well positioned to benefit for many years to come as a result of the significant impact [removed: these] [added: the various] generations [added: discussed above] will have on rental housing.

Over the [removed: past several years,] [added: last decade,] the Company has done an extensive repositioning of its portfolio into urban and highly walkable, close-in suburban assets.

We [added: attempt to] balance occupancy and rental rates to maximize our revenue while exercising tight cost control to generate the highest possible return to our shareholders.

We [removed: also] use a standardized purchasing system to control our operating expenses and a business intelligence platform that allows all our team members to quickly identify and address issues and opportunities.

[removed: The technology driving the rental industry continues to evolve at a rapid pace, and we] [added: We] have [removed: long] been [added: and continue to be] a leader in deploying and investing in property technology to serve our customers better and operate more efficiently.

[removed: As] [added: Having been] a first mover in such important areas as revenue [removed: management,] [added: management and] online leasing, [removed: centralized procurement and internet listing services,] we are focused on technology that improves our operating [removed: margin] [added: margins] and customer [removed: experience.][added: experience while also meeting the current needs of our customers, including addressing the challenges of the pandemic.]

[removed: We] [added: While we] believe [removed: these] areas [added: such as “smart home” technology and others] will provide the foundation for current and future improvements to how we do [removed: business.][added: business, we will continue to consider the cost and longevity of technology capital investments versus the benefits.]

[removed: Our] [added: We have assembled an] employee-led Equity Values Council [removed: leads] [added: to lead] our efforts on these values by acting as change agents to drive [removed: initiatives and] [added: initiatives,] create [removed: awareness.][added: goals and awareness, and encourage colleagues to participate in community service activities and wellness initiatives.]

[removed: Additionally,] [added: In addition,] executive compensation is [removed: based] [added: based,] in [removed: part] [added: part,] on meeting [removed: these] important Equity Values goals, and our Board of Trustees takes an active role in overseeing [removed: these matters.][added: our efforts in this regard.]

Our Commitment to [removed: ESG][added: Environmental, Social and Governance (“ESG”)]

[removed: Our purpose] [added: Equity Residential] is [added: committed to] creating communities where people thrive.

Our sustainability goals help us focus efforts and [removed: track progress.][added: drive outcomes to create a more sustainable future for all.]

We are especially [removed: focusing] [added: focused] on energy consumption, water consumption and greenhouse gas emissions.

For additional information regarding our ESG efforts, see our [removed: October 2019] [added: November 2020] Environmental, Social and Governance Report at our website, www.equityapartments.com.

This [removed: report] [added: report, which includes Sustainability Accounting Standards Board disclosures and incorporates recommendations from the Task Force on Climate-related Financial Disclosures,] was reviewed and approved by the Corporate Governance Committee of our Board of Trustees, which monitors the Company’s ongoing ESG efforts.

[removed: Please] [added: | | • | For further discussion, please] refer to Item 7, *Management’s Discussion and Analysis of Financial Condition and Results of Operations*, for the Company’s [removed: Results of Operations] [added: responses related to health] and [removed: Liquidity.][added: safety issues during the COVID-19 pandemic. |]

All of the Company’s properties are located in developed areas [removed: that include] [added: with multiple housing choices, including] other multifamily properties.

The number of competitive [added: housing choices or] multifamily properties in a particular area could have a material effect on the Company’s ability to lease apartment units at its properties and on the rents charged.

The Company may be competing with other [removed: entities] [added: housing providers] that have greater resources than the Company and whose managers have more experience than the Company’s managers.

In addition, other forms of rental properties and [removed: single family] [added: single-family] housing provide housing alternatives to potential residents of multifamily properties.

See Item 1A, *Risk Factors*, for information concerning the potential effects of [added: governmental regulations, including] environmental [removed: regulations] [added: regulations,] on our operations.

The Company, a member of the S&P 500, is focused on the acquisition, development and management of residential properties located in and around dynamic cities that attract high quality long-term renters.

Our properties are located in places that are attractive to knowledge workers whom we hope to convert into satisfied long-term residents.

We carry this, our corporate purpose, through our relationships with our customers, our employees, our shareholders and the communities in which we operate.

Despite the challenges we have faced with the COVID-19 pandemic, we believe that the long-term prospects for our business remain strong.

Our well-located communities are in and around dynamic cities that we believe will continue to attract high quality long-term renters.

When the pandemic subsides, we believe urban centers will re-energize and once again provide significant networking and other benefits for current and prospective residents who may have temporarily deferred, but not abandoned, their desire to live in vibrant major U.S. metropolitan areas.

We also consider governmental fiscal health, political/regulatory risk and resiliency of our targeted markets.

| | • | High single-family housing prices relative to rental housing costs leading to less competition from owned or rented single-family housing; |

Overall, our high-quality resident tends to work in the highest earning sectors of the economy and is not rent burdened, creating the ability to raise rents more readily in good economic times and reducing risk during downturns.

Many of these workers are employed in the fields of Science, Technology, Engineering and Mathematics, or STEM jobs.

They have experienced significantly lower job loss during COVID-19.

While we continue to look for opportunities to expand our portfolio in these locations, it is our intention over time to further diversify our portfolio into select new markets that share the same characteristics as our current markets and to optimize the mix of our properties located in urban vs. dense suburban submarkets within our existing markets.

We believe our success prior to the pandemic in renewing our residents is due to our focus on the resident experience.

This focus has driven the strong occupancy and renewal rate growth that we have achieved over the last several years prior to the COVID-19 pandemic, which we would expect to return once the pandemic subsides.

Technology continues to drive innovation in the rental industry and to evolve at a rapid pace.

Our operations benefitted from having many of these initiatives in place during the pandemic, allowing us to interact with our customers in a safe and responsible manner, including self-guided tours, automated responses to customer inquiries and enhanced service and maintenance management.

At Equity Residential, we believe a focus on ESG is a key way to programmatically address stakeholder concerns as part of our corporate purpose.

We consider building locations based on walkability, accessibility, neighborhoods and parks.

We also design our communities to support amenities such as fitness centers and we select locations near shops, healthy restaurants and health and wellness programs, enabling a low carbon footprint lifestyle for our residents to live, work and play.

We are also intensely focused on the “Social” and “Governance” aspects of ESG.

As detailed below, we have a commitment to our employees’ engagement, diversity and wellness that is the foundation of our corporate purpose.

We also recognize that a successful company must incorporate the best corporate governance practices in order to better serve its stakeholders.

In 2018, the Company became the first multifamily REIT ever to issue a “green bond”.

As a result, the net proceeds of approximately $396.7 million from the offering were allocated to eligible green/sustainable certified projects.

Furthermore, our annual proxy statements contain additional information on our corporate governance practices.

Such annual proxy statements and the information contained therein are not part of or incorporated into this report.

Human Capital

At Equity Residential, our team of approximately 2,600 employees is the driving force behind our success.

We believe that our richly diverse work environment captures top talent, cultivates the best ideas and creates the widest possible platform for this success in line with our corporate purpose of “*Creating communities where people thrive.*” Our core principles, affectionately named “Ten Ways to Be a Winner,” guide our behavior as individuals and collectively as a team, helping us in our goal to deliver market-leading performance.

As part of our Ten Ways to Be a Winner, we encourage our team members to raise questions, take educated risks, offer new ideas and help us make the right decisions.

One way we live the “Ten Ways” is by enriching our culture through our core “Equity Values”—Diversity and Inclusion, Social Responsibility, Sustainability and Total Well-Being.

*Diversity and Inclusion*

| | • | Our commitment to diversity and inclusion starts at the top with a highly skilled and diverse Board of Trustees. |

| | • | We are committed to hiring a diverse workforce and also fostering a safe, inclusive and productive workplace for all employees. We believe providing a work environment based on respect, trust and collaboration creates an exceptional employee experience where employees can bring their whole selves to work and thrive in their careers. In recent years, we have created a Director of Diversity and Inclusion position to oversee this crucial work. |

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

| | • | To further prioritize the importance of our diversity and inclusion efforts, our executives’ annual compensation goals include an evaluation of objective metrics measuring our Company’s progress in this regard. |

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

| | • | We have the benefit of a diverse workforce, of which 60.0% currently identify as ethnically diverse. We also continue to focus on improving our female representation, which is now 37.0% of our workforce. |

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

| | • | Going forward, we plan to continue to strategically identify opportunities to increase the diversity of our talent pipeline at all levels, including by actively sourcing diverse candidates for mid-management and above positions. |

The Company, a member of the S&P 500, is focused on the acquisition, development and management of rental apartment properties located in urban and high-density suburban communities where today’s renters want to live, work and play.

Unless otherwise indicated, the notes to consolidated financial statements apply to both the Company and the Operating Partnership.

As of December 31, 2019, the Company had approximately 2,700 employees who provided real estate operations, leasing, legal, financial, accounting, acquisition, disposition, development and other support functions.

Continued high wage job and income growth, positive demographics and a consumer preference for a rental lifestyle in our highly desirable markets has created a supportive backdrop for our business.

This, in turn, attracts employers to our markets seeking to locate and expand their businesses and employ this talented pool of workers, resulting in strong demand for our product.

These “Equity Values” are deeply embedded in our culture.

| | • | High single family housing prices; |

| | • | Highly walkable urban and high-density suburban areas in what we believe are some of the best locations in the public apartment REIT sector with an attractive quality of life, leading to high resident demand and retention; |

While we continue to look for opportunities to expand our portfolio in these locations, we also have been exploring other markets that share these same characteristics, such as Denver.

These markets feature strong high wage job growth, high single family home prices and a very attractive lifestyle for our target demographic, which we believe will lead to long-term outperformance for a rental market.

We believe our great success with renewal rate growth is due to our motivation to retain our residents with a relentless focus on customer service.

Highly satisfied residents stay longer and say great things about us.

Currently, we are focused on areas such as self-guided tours enabled by technology; automated responses to customer inquiries; data analytics to drive expense savings and revenue improvements; and “smart home” technology.

*Focus on Our Employees*

The Company has a strong, rich culture with a commitment to our “Equity Values” of Diversity & Inclusion, “Total Well-Being” (which brings together physical, financial, career, social and community well-being into a cohesive whole), Sustainability and Social Responsibility.

We actively elevate and support these values when employees’ voices are heard and we embrace each other regardless of our differences; when we give back to our communities; when we care for and preserve our environment; and when we encourage and enable our employees and their families to thrive in all areas of well-being.

We engage our stakeholders for feedback on key issues, and environmental, social and governance (“ESG”) factors help guide our investment and operating strategy.

Our goal is to create and sustain an inclusive environment where diversity will thrive, employees will want to work and residents will want to live.

The Equity Values Council drives new, diversity-focused initiatives for recruitment, career development and education.

We actively promote from within, and many senior corporate and property leaders have risen from entry level or junior positions.

We survey our employees annually to identify strengths and opportunities in employee satisfaction.

We continue to maintain high engagement scores in these surveys and find our employees say they are proud to work at the Company, value one another as colleagues, believe in our mission and values and feel their skills meet their job requirements.

The Company was honored with a Glassdoor Employees’ Choice Award, recognizing the Company as one of the 100 Best Places to Work in 2019 among all United States large companies, was in the Top 50 on the overall list and was the highest rated real estate company in this survey.

Indeed also recognized the Company as a top-rated workplace in many of our markets.

We invest in locations that are highly walkable and transit-friendly, enabling a low carbon footprint lifestyle for our residents to live, work and play.

In addition, the Company issued $400.0 million of ten-year 4.15% unsecured notes in 2018 as "green" bonds, and as a result, the Company allocated an amount equal to the net proceeds to eligible green/sustainable projects.

This was the first "green" bond issuance from an apartment REIT.

Environmental Considerations

As of December 31, [removed: 2019,] [added: 2020,] the Company does not believe there is any litigation pending or threatened against it that, individually or in the aggregate, may reasonably be expected to have a material adverse effect on the Company.

For the Fiscal Year Ended December 31, [removed: 2019][added: 2020]

[added: |] Equity Residential [added: | |] ☐ [added: | |] ERP Operating Limited Partnership [added: | |] ☐ [added: |]

The aggregate market value of Common Shares held by non-affiliates of the Registrant was approximately [removed: $27.9] [added: $21.7] billion based upon the closing price on June 30, [removed: 2019] [added: 2020] of [removed: $75.92] [added: $58.82] using beneficial ownership of shares rules adopted pursuant to Section 13 of the Securities Exchange Act of 1934 to exclude voting shares owned by Trustees and Executive Officers, some of whom may not be held to be affiliates upon judicial determination.

The number of Common Shares of Beneficial Interest, $0.01 par value, outstanding on February [removed: 14, 2020] [added: 12, 2021] was [removed: 371,978,449.][added: 372,663,215.]

Part III incorporates by reference certain information that will be contained in Equity Residential’s Proxy Statement relating to its [removed: 2020] [added: 2021] Annual Meeting of Shareholders, which Equity Residential intends to file no later than 120 days after the end of its fiscal year ended December 31, [removed: 2019,] [added: 2020,] and thus these items have been omitted in accordance with General Instruction G(3) to Form 10-K.

This report combines the annual reports on Form 10-K for the year ended December 31, [removed: 2019] [added: 2020] of Equity Residential and ERP Operating Limited Partnership.

[removed: ][added: ]

EQR is the general partner of, and as of December 31, [removed: 2019] [added: 2020] owned an approximate 96.4% ownership interest in, ERPOP.

| Item 1A. | | [Risk Factors](#ITEM_1A_RISK_FACTORS) | | [removed: 9] [added: 11] |

| Item 1B. | | [Unresolved Staff Comments](#ITEM_1B_UNRESOLVED_STAFF_COMMENTS) | | [removed: 17] [added: 21] |

| Item 2. | | [Properties](#ITEM_2_PROPERTIES) | | [removed: 17] [added: 21] |

| Item 3. | | [Legal Proceedings](#ITEM_3_LEGAL_PROCEEDINGS) | | [removed: 19] [added: 23] |

| Item 4. | | [Mine Safety Disclosures](#ITEM_4_MINE_SAFETY_DISCLOSURES) | | [removed: 19] [added: 23] |

| Item 5. | | [Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](#ITEM_5_MARKET_FOR_REGISTRANTS_COMMON_EQU) | | [removed: 20] [added: 24] |

| Item 6. | | [removed: [Selected Financial Data](#ITEM_6_SELECTED_FINANCIAL_DATA)] [added: [Reserved](#ITEM_6_SELECTED_FINANCIAL_DATA)] | | [removed: 21] [added: 24] |

| Item 7. | | [Management’s Discussion and Analysis of Financial Condition and Results of Operations](#ITEM_7_MANAGEMENTS_DISCUSSION_ANALYSIS_F) | | [removed: 23] [added: 25] |

| Item 7A. | | [Quantitative and Qualitative Disclosures about Market Risk](#ITEM_7A_QUANTITATIVE_QUALITATIVE_DISCLOS) | | [removed: 42] [added: 45] |

| Item 8. | | [Financial Statements and Supplementary Data](#ITEM_8_FINANCIAL_STATEMENTS_SUPPLEMENTAR) | | [removed: 43] [added: 46] |

| Item 9. | | [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](#ITEM_9_CHANGES_IN_DISAGREEMENTS_WITH_ACC) | | [removed: 43] [added: 46] |

| Item 9A. | | [Controls and Procedures](#ITEM_9A_CONTROLS_PROCEDURES) | | [removed: 43] [added: 46] |

| Item 9B. | | [Other Information](#ITEM_9B_OR_INFORMATION) | | [removed: 44] [added: 47] |

| Item 10. | | [Trustees, Executive Officers and Corporate Governance](#ITEMS_10_11_12_13_14) | | [removed: 45] [added: 48] |

| Item 11. | | [Executive Compensation](#ITEMS_10_11_12_13_14) | | [removed: 45] [added: 48] |

| Item 12. | | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](#ITEMS_10_11_12_13_14) | | [removed: 45] [added: 48] |

| Item 13. | | [Certain Relationships and Related Transactions, and Trustee Independence](#ITEMS_10_11_12_13_14) | | [removed: 45] [added: 48] |

| Item 14. | | [Principal Accounting Fees and Services](#ITEMS_10_11_12_13_14) | | [removed: 45] [added: 48] |

| Item 15. | | [Exhibits, Financial Statement Schedules](#ITEM_15_EXHIBITS_FINANCIAL_STATEMENT_SCH) | | [removed: 46] [added: 49] |

| Item 16. | | [Form 10-K Summary](#ITEM_16_FORM_10K_SUMMARY) | | [removed: 46] [added: 49] |

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

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

| Equity Residential | | ☒ | | ERP Operating Limited Partnership | | ☒ |

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

| | | | | |

| EX-4.1 | | | | |

| EX-4.2 | | | | |

| EX-4.3 | | | | |

As of December 31, [removed: 2019,] [added: 2020,] the Company, directly or indirectly through investments in title holding entities, owned all or a portion of [removed: 309] [added: 304] properties located in [removed: 10] [added: 9] states and the District of Columbia consisting of [removed: 79,962] [added: 77,889] apartment units.

| Wholly Owned Properties | | | [removed: 291] [added: 287] | | | | [removed: 76,265] [added: 74,328] | |

| Partially Owned Properties – Consolidated | | | [removed: 17] [added: 16] | | | | [removed: 3,535] [added: 3,399] | |

The following table sets forth certain information by market relating to the Company’s properties at December 31, [removed: 2019:][added: 2020:]

| Markets/Metro Areas | | Properties | | | | Apartment Units | | | | % of Stabilized Budgeted NOI [removed: (A)] [added: (1)] | | | | Average Rental Rate [removed: (B)] [added: (2)] | | |

| Los Angeles | | | 72 | | | | 16,603 | | | | [removed: 18.7] [added: 21.5] | % | | $ | [removed: 2,634] [added: 2,458] | |

| Orange County | | | 13 | | | | 4,028 | | | | [removed: 4.3] [added: 5.4] | % | | | [removed: 2,271] [added: 2,222] | |

| San Diego | | | [removed: 12] [added: 11] | | | | [removed: 3,385] [added: 2,706] | | | | 3.8 | % | | | [removed: 2,437] [added: 2,373] | |

| New York | | | 37 | | | | 9,606 | | | | [removed: 14.4] [added: 11.3] | % | | | [removed: 3,937] [added: 3,617] | |

| [removed: (A)] [added: (1)] | % of Stabilized Budgeted NOI - Represents [added: original] budgeted [removed: 2020] [added: 2021] NOI for stabilized properties and projected annual NOI at stabilization (defined as having achieved 90% occupancy for three consecutive months) for properties that are in lease-up. |

| [removed: (B)] [added: (2)] | Average Rental Rate - Total residential rental revenues reflected on a straight-line basis in accordance with GAAP divided by the weighted average occupied apartment units for the reporting period presented. |

As of December 31, [removed: 2019,] [added: 2020,] the Company’s same store occupancy was [removed: 96.1%] [added: 94.4%] and its total portfolio-wide occupancy, which includes completed development properties in various stages of lease-up, was [removed: 95.8%.][added: 94.2%.]

In addition, many of our urban properties have [added: non-residential components, such as] parking garages and/or retail [removed: components.][added: spaces.]

The [removed: consolidated] properties currently in various stages of development and lease-up at December 31, [removed: 2019] [added: 2020, all of which] are [added: consolidated, are] included in the following table:

| Development and Lease-Up Projects as of December 31, [removed: 2019] [added: 2020] | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Alcott Apartments (fka West End Tower) | | Boston, MA | | | 470 | | | $ | 409,749 | | | $ | [removed: 139,310] [added: 267,783] | | | $ | [removed: 139,310] [added: 267,783] | | | $ | — | | | | [removed: 32] [added: 67] | % | | Q2 2021 | | Q3 2021 | | Q1 2023 | | | — | | | | — | |

| [added: The Edge (fka] 4885 Edgemoor [removed: Lane] [added: Lane)] (2) | | Bethesda, MD | | | 154 | | | | 75,271 | | | | [removed: 10,865] [added: 52,312] | | | | [removed: 10,865] [added: 52,312] | | | | — | | | | [removed: 4] [added: 70] | % | | Q3 2021 | | Q3 2021 | | Q3 2022 | | | — | | | | — | |

| Projects Under Development Wholly Owned | | | | | 624 | | | | 485,020 | | | | [removed: 150,175] [added: 320,095] | | | | [removed: 150,175] [added: 320,095] | | | | — | | | | | | | | | | | | | | | | | | | |

| Aero Apartments (3) | | Alameda, CA | | | 200 | | | | 117,794 | | | | [removed: 31,455] [added: 91,039] | | | | [removed: 31,455] [added: 91,039] | | | | [removed: 7,050] [added: 31,494] | | | | [removed: 11] [added: 78] | % | | [removed: Q4 2020] [added: Q1 2021] | | Q2 2021 | | Q2 2022 | | | — | | | | — | |

| Projects Under Development Partially Owned | | | | | 200 | | | | 117,794 | | | | [removed: 31,455] [added: 91,039] | | | | [removed: 31,455] [added: 91,039] | | | | [removed: 7,050] [added: 31,494] | | | | | | | | | | | | | | | | | | | |

| [added: Total] Projects Under Development | | | | | 824 | | | [added: $] | 602,814 | | | [added: $] | [removed: 181,630] [added: 411,134] | | | [added: $] | [removed: 181,630] [added: 411,134] | | | [added: $] | [removed: 7,050] [added: 31,494] | | | | | | | | | | | | | | | | | | | |

| Land Held for Development | | | | N/A | | | | N/A | | | | $ | [removed: 96,688] [added: 86,170] | | | $ | [removed: 96,688] [added: 86,170] | | | $ | — | | | | | | | | | | | | | | | | | | | |

| (2) | [removed: 4885 Edgemoor Lane] [added: The Edge] – The land under this project is subject to a long-term ground lease. This project is adjacent to an existing apartment property owned by the Company. |

| (3) | Aero Apartments – This development project is owned 90% by the Company and 10% by a [removed: third party] [added: third-party] partner in a joint venture consolidated by the Company. Construction is being partially funded with a construction loan that is non-recourse to the Company. The joint venture partner has funded [removed: $4.6] [added: $4.7] million for its allocated share of the project equity and serves as the developer of the project. |

| Garden | | | 102 | | | | 25,791 | | | | 253 | |

| Mid/High-Rise | | | 202 | | | | 52,098 | | | | 258 | |

| | | | 304 | | | | 77,889 | | | | 256 | |

| | | | 304 | | | | 77,889 | |

| Subtotal – Southern California | | | 96 | | | | 23,337 | | | | 30.7 | % | | | 2,407 | |

| San Francisco | | | 48 | | | | 12,707 | | | | 18.3 | % | | | 3,053 | |

| Washington D.C. | | | 47 | | | | 14,731 | | | | 17.2 | % | | | 2,387 | |

| Seattle | | | 46 | | | | 9,454 | | | | 11.4 | % | | | 2,349 | |

| Boston | | | 25 | | | | 6,430 | | | | 9.4 | % | | | 2,958 | |

| Denver | | | 5 | | | | 1,624 | | | | 1.7 | % | | | 2,003 | |

| Total | | | 304 | | | | 77,889 | | | | 100.0 | % | | $ | 2,680 | |

| Garden | | | 105 | | | | 26,688 | | | | 254 | |

| Mid/High-Rise | | | 204 | | | | 53,274 | | | | 261 | |

| | | | 309 | | | | 79,962 | | | | 259 | |

| | | | 309 | | | | 79,962 | |

| Subtotal – Southern California | | | 97 | | | | 24,016 | | | | 26.8 | % | | | 2,545 | |

| San Francisco | | | 51 | | | | 13,606 | | | | 20.6 | % | | | 3,320 | |

| Washington D.C. | | | 48 | | | | 15,248 | | | | 16.2 | % | | | 2,466 | |

| Seattle | | | 45 | | | | 9,296 | | | | 10.7 | % | | | 2,459 | |

| Boston | | | 25 | | | | 6,430 | | | | 9.9 | % | | | 3,179 | |

| Denver | | | 5 | | | | 1,624 | | | | 1.4 | % | | | 2,053 | |

| Other Markets | | | 1 | | | | 136 | | | | — | % | | | 1,323 | |

| Total | | | 309 | | | | 79,962 | | | | 100.0 | % | | $ | 2,858 | |

| --- | --- |

Resident leases are generally for twelve months in length.

| Completed Not Stabilized (4): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Lofts at Kendall Square II (fka 249 Third Street) | | Cambridge, MA | | | 84 | | | | 51,447 | | | | 47,259 | | | | — | | | | — | | | | | | | Q3 2019 | | Q3 2019 | | Q2 2020 | | | 81 | % | | | 79 | % |

| Chloe on Madison (fka 1401 E. Madison) | | Seattle, WA | | | 137 | | | | 65,341 | | | | 62,995 | | | | — | | | | — | | | | | | | Q3 2019 | | Q3 2019 | | Q2 2020 | | | 81 | % | | | 75 | % |

| Projects Completed Not Stabilized | | | | | 221 | | | | 116,788 | | | | 110,254 | | | | — | | | | — | | | | | | | | | | | | | | | | | | | |

| Completed and Stabilized During the Quarter: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| 100K Apartments | | Washington D.C. | | | 222 | | | | 85,273 | | | | 85,262 | | | | — | | | | — | | | | | | | Q3 2018 | | Q4 2018 | | Q4 2019 | | | 96 | % | | | 96 | % |

| Projects Completed and Stabilized During the Quarter | | | | | 222 | | | | 85,273 | | | | 85,262 | | | | — | | | | — | | | | | | | | | | | | | | | | | | | |

| Total Development Projects | | | | | 1,267 | | | $ | 804,875 | | | $ | 377,146 | | | $ | 181,630 | | | $ | 7,050 | | | | | | | | | | | | | | | | | | | |

| (4) | Properties included here are substantially complete. However, they may still require additional exterior and interior work for all apartment units to be available for leasing. Both of these properties are wholly owned by the Company. |

Common Share/Unit [removed: Dividends/Distributions] [added: Information] (Equity Residential and ERP Operating Limited Partnership)

At February [removed: 14, 2020,] [added: 12, 2021,] the number of record holders of Common Shares was approximately [removed: 2,030] [added: 1,950] and [removed: 371,978,449] [added: 372,663,215] Common Shares were outstanding.

At February [removed: 14, 2020,] [added: 12, 2021,] the number of record holders of Units in the Operating Partnership was approximately [removed: 485] [added: 475] and [removed: 385,928,364] [added: 386,705,589] Units were outstanding.

Unregistered Common Shares Issued in the Quarter Ended December 31, [removed: 2019] [added: 2020] (Equity Residential)

During the quarter ended December 31, [removed: 2019,] [added: 2020,] EQR issued [removed: 19,540] [added: 22,768] Common Shares in exchange for [removed: 19,540] [added: 22,768] OP Units held by various limited partners of ERPOP.

The following table provides information as of December 31, [removed: 2019] [added: 2020] with respect to the Company’s Common Shares that may be issued under its existing equity compensation plans.

| (1) | The amounts shown in columns (a) and (b) of the above table do not include [removed: 306,706] [added: 353,634] outstanding Common Shares (all of which are restricted and subject to vesting requirements) that were granted under the Company’s 2011 Share Incentive Plan, as amended (the “2011 Plan”), and 2019 Share Incentive Plan, as amended (the “2019 Plan”), and outstanding Common Shares that have been purchased by employees and trustees under the Company’s ESPP. |

| (2) | Includes [removed: 11,328,266] [added: 10,512,390] Common Shares that may be issued under the 2019 Plan and [removed: 2,714,332] [added: 2,624,136] Common Shares that may be sold to employees and trustees under the ESPP. |

As of December 31, [removed: 2019, 11,328,266] [added: 2020, 10,512,390] shares were available for future issuance.

| Equity compensation plans approved by shareholders | | | 5,642,752 | | | $ | 56.91 | | | | 13,136,526 | |

The following table sets forth, for the years indicated, the dividends/distributions declared on the Company’s Common Shares/Operating Partnership’s Units.

| | | Dividends/Distributions | | | | | | |

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

| | | 2019 | | | | 2018 | | |

| Fourth Quarter Ended December 31, | | $ | 0.5675 | | | $ | 0.54 | |

| Third Quarter Ended September 30, | | $ | 0.5675 | | | $ | 0.54 | |

| Second Quarter Ended June 30, | | $ | 0.5675 | | | $ | 0.54 | |

| First Quarter Ended March 31, | | $ | 0.5675 | | | $ | 0.54 | |

| Equity compensation plans approved by shareholders | | | 5,567,544 | | | $ | 55.52 | | | | 14,042,598 | |

The following tables set forth selected financial and operating information on a historical basis for the Company and the Operating Partnership.

The following information should be read in conjunction with all of the financial statements and notes thereto included elsewhere in this Form 10-K.

The historical operating and balance sheet data have been derived from the historical financial statements of the Company and the Operating Partnership.

Certain capitalized terms as used herein are defined in the Notes to Consolidated Financial Statements.

As a result of the adoption of new lease accounting guidance on January 1, 2019, prior period amounts were not adjusted and continue to be reported in accordance with our historic accounting policies (see Note 2 in the Notes to Consolidated Financial Statements for further discussion).

EQUITY RESIDENTIAL

CONSOLIDATED HISTORICAL FINANCIAL INFORMATION

(Financial information in thousands except for per share and property data)

| | | Year Ended December 31, | | | | | | | | | | | | | | | | | | |

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

| | | 2019 | | | | 2018 | | | | 2017 | | | | 2016 | | | | 2015 | | |

| OPERATING DATA: | | | | | | | | | | | | | | | | | | | | |

| Total revenues from continuing operations | | $ | 2,701,075 | | | $ | 2,578,434 | | | $ | 2,471,406 | | | $ | 2,425,800 | | | $ | 2,744,965 | |

| Net gain (loss) on sales of real estate properties | | $ | 447,637 | | | $ | 256,810 | | | $ | 157,057 | | | $ | 4,044,055 | | | $ | 335,134 | |

| Interest and other income | | $ | 2,817 | | | $ | 15,317 | | | $ | 6,136 | | | $ | 65,773 | | | $ | 7,372 | |

| Income from continuing operations | | $ | 1,009,708 | | | $ | 685,192 | | | $ | 628,381 | | | $ | 4,479,586 | | | $ | 907,621 | |

| Discontinued operations, net | | $ | — | | | $ | — | | | $ | — | | | $ | 518 | | | $ | 397 | |

| Net income | | $ | 1,009,708 | | | $ | 685,192 | | | $ | 628,381 | | | $ | 4,480,104 | | | $ | 908,018 | |

| Net income available to Common Shares | | $ | 967,287 | | | $ | 654,445 | | | $ | 600,363 | | | $ | 4,289,072 | | | $ | 863,277 | |

| Earnings per share – basic: | | | | | | | | | | | | | | | | | | | | |

| Income from continuing operations available to Common Shares | | $ | 2.61 | | | $ | 1.78 | | | $ | 1.64 | | | $ | 11.75 | | | $ | 2.37 | |

| Net income available to Common Shares | | $ | 2.61 | | | $ | 1.78 | | | $ | 1.64 | | | $ | 11.75 | | | $ | 2.37 | |

| Weighted average Common Shares outstanding | | | 370,461 | | | | 368,052 | | | | 366,968 | | | | 365,002 | | | | 363,498 | |

| Earnings per share – diluted: | | | | | | | | | | | | | | | | | | | | |

| Income from continuing operations available to Common Shares | | $ | 2.60 | | | $ | 1.77 | | | $ | 1.63 | | | $ | 11.68 | | | $ | 2.36 | |

| Net income available to Common Shares | | $ | 2.60 | | | $ | 1.77 | | | $ | 1.63 | | | $ | 11.68 | | | $ | 2.36 | |

| Weighted average Common Shares outstanding | | | 386,333 | | | | 383,695 | | | | 382,678 | | | | 381,992 | | | | 380,620 | |

| Distributions declared per Common Share outstanding | | $ | 2.27 | | | $ | 2.16 | | | $ | 2.015 | | | $ | 13.015 | | | $ | 2.21 | |

| BALANCE SHEET DATA (at end of period): | | | | | | | | | | | | | | | | | | | | |

| Real estate, before accumulated depreciation | | $ | 27,533,607 | | | $ | 26,511,022 | | | $ | 26,026,896 | | | $ | 25,386,425 | | | $ | 25,182,352 | |

| Real estate, after accumulated depreciation | | $ | 20,256,821 | | | $ | 19,814,741 | | | $ | 19,986,518 | | | $ | 20,026,036 | | | $ | 20,276,946 | |

| Real estate held for sale | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | 2,181,135 | |

| Total assets | | $ | 21,172,769 | | | $ | 20,394,209 | | | $ | 20,570,599 | | | $ | 20,704,148 | | | $ | 23,110,196 | |

| Total debt | | $ | 9,036,956 | | | $ | 8,817,939 | | | $ | 8,957,291 | | | $ | 8,987,258 | | | $ | 10,921,366 | |

| Redeemable Noncontrolling Interests – Operating Partnership | | $ | 463,400 | | | $ | 379,106 | | | $ | 366,955 | | | $ | 442,092 | | | $ | 566,783 | |

| Total shareholders' equity | | $ | 10,315,506 | | | $ | 10,173,204 | | | $ | 10,242,464 | | | $ | 10,229,078 | | | $ | 10,470,368 | |

| Total Noncontrolling Interests | | $ | 229,020 | | | $ | 226,445 | | | $ | 231,399 | | | $ | 231,906 | | | $ | 225,987 | |

| OTHER DATA: | | | | | | | | | | | | | | | | | | | | |

| Total properties (at end of period) | | | 309 | | | | 307 | | | | 305 | | | | 302 | | | | 394 | |

| Total apartment units (at end of period) | | | 79,962 | | | | 79,482 | | | | 78,611 | | | | 77,458 | | | | 109,652 | |

Effective as of December 31, [removed: 2019,] [added: 2020,] the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the Company’s disclosure controls and procedures pursuant to Exchange Act Rules 13a-15 and 15d-15.

[removed: (b)] [added: (b)] Management’s Report on Internal Control over Financial [removed: Reporting:][added: Reporting:]

Based on the Company’s evaluation under the framework in Internal Control – Integrated Framework, management concluded that its internal control over financial reporting was effective as of December 31, [removed: 2019.][added: 2020.]

Our internal control over financial reporting has been audited as of December 31, [removed: 2019] [added: 2020] by Ernst & Young LLP, an independent registered public accounting firm, as stated in their report which is included herein.

There were no changes to the internal control over financial reporting of the Company identified in connection with the Company’s evaluation referred to above that occurred during the fourth quarter of [removed: 2019] [added: 2020] that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

[removed: *ERP] [added: ERP] Operating Limited [removed: Partnership*][added: Partnership]

Effective as of December 31, [removed: 2019,] [added: 2020,] the Operating Partnership carried out an evaluation, under the supervision and with the participation of the Operating Partnership’s management, including the Chief Executive Officer and Chief Financial Officer of EQR, of the effectiveness of the Operating Partnership’s disclosure controls and procedures pursuant to Exchange Act Rules 13a-15 and 15d-15.

Based on the Operating Partnership’s evaluation under the framework in Internal Control – Integrated Framework, management concluded that its internal control over financial reporting was effective as of December 31, [removed: 2019.][added: 2020.]

There were no changes to the internal control over financial reporting of the Operating Partnership identified in connection with the Operating Partnership’s evaluation referred to above that occurred during the fourth quarter of [removed: 2019] [added: 2020] that have materially affected, or are reasonably likely to materially affect, the Operating Partnership’s internal control over financial reporting.

Our internal control over financial reporting has been audited as of December 31, 2020 by Ernst & Young LLP, an independent registered public accounting firm, as stated in their report which is included herein.

The information required by Item 10, Item 11, Item 12, Item 13 and Item 14 is incorporated by reference to, and will be contained in, Equity Residential’s Proxy Statement, which the Company intends to file no later than 120 days after the end of its fiscal year ended December 31, [removed: 2019,] [added: 2020,] and thus these items have been omitted in accordance with General Instruction G(3) to Form 10-K.

| [removed: 3.4] [added: 3.5] | | [Sixth Amended and Restated Agreement of Limited Partnership for ERP Operating Limited Partnership dated as of March 12, 2009.](http://www.sec.gov/Archives/edgar/data/906107/000119312509057691/dex101.htm) | | Included as Exhibit 10.1 to Equity Residential's and ERP Operating Limited Partnership's Form 8-K dated March 12, 2009, filed on March 18, 2009. |

| 4.1 | | [Description of Equity Residential Common Shares Registered Under Section 12 of the Securities Exchange Act of [removed: 1934.](https://www.sec.gov/Archives/edgar/data/906107/000156459020005562/eqr-ex41_637.htm)] [added: 1934.](http://www.sec.gov/Archives/edgar/data/906107/000156459020005562/eqr-ex41_637.htm)] | | [removed: Attached herein.] [added: Included as Exhibit 4.1 to Equity Residential's and ERP Operating Limited Partnership's Form 10-K for the year ended December 31, 2019.] |

| 4.2 | | [Description of ERP Operating Limited Partnership Notes Registered Under Section 12 of the Securities Exchange Act of [removed: 1934.](https://www.sec.gov/Archives/edgar/data/906107/000156459020005562/eqr-ex42_636.htm)] [added: 1934.](http://www.sec.gov/Archives/edgar/data/906107/000156459020005562/eqr-ex42_636.htm)] | | [removed: Attached herein.] [added: Included as Exhibit 4.2 to Equity Residential's and ERP Operating Limited Partnership's Form 10-K for the year ended December 31, 2019.] |

| 4.3 | | [Description of ERP Operating Limited Partnership OP Units Registered Under Section 12 of the Securities Exchange Act of [removed: 1934.](https://www.sec.gov/Archives/edgar/data/906107/000156459020005562/eqr-ex43_635.htm)] [added: 1934.](http://www.sec.gov/Archives/edgar/data/906107/000156459020005562/eqr-ex43_635.htm)] | | [removed: Attached herein.] [added: Included as Exhibit 4.3 to Equity Residential's and ERP Operating Limited Partnership's Form 10-K for the year ended December 31, 2019.] |

| [removed: 10.4] [added: 10.2] | | [Revolving Credit Agreement, dated as of November 1, 2019, among ERP Operating Limited Partnership, Bank of America, N.A., as Administrative Agent, and the financial institutions party thereto.](http://www.sec.gov/Archives/edgar/data/906107/000119312519283407/d794732dex101.htm) | | Included as Exhibit 10.1 to Equity Residential's and ERP Operating Limited Partnership's Form 8-K dated November 1, 2019, filed on November 4, 2019. |

| [removed: 10.5] [added: 10.3] | | [Amended and Restated Limited Partnership Agreement of Lexford Properties, L.P.](http://www.sec.gov/Archives/edgar/data/906107/000091205700011416/0000912057-00-011416.txt) | | Included as Exhibit 10.16 to Equity Residential's Form 10-K for the year ended December 31, 1999. |

| [removed: 10.6] [added: 10.4] | * | [Equity Residential 2019 Share Incentive Plan.](http://www.sec.gov/Archives/edgar/data/906107/000119312519187395/d26582dex991.htm) | | Included as Exhibit 99.1 to Equity Residential's and ERP Operating Limited Partnership's Form 8-K dated June 27, 2019, filed on July 1, 2019. |

| [removed: 10.7] [added: 10.5] | * | [Equity Residential 2011 Share Incentive Plan.](http://www.sec.gov/Archives/edgar/data/906107/000095012311060571/c65161exv99w1.htm) | | Included as Exhibit 99.1 to Equity Residential's and ERP Operating Limited Partnership's Form 8-K dated June 16, 2011, filed on June 22, 2011. |

| [removed: 10.8] [added: 10.6] | * | [First Amendment to 2011 Share Incentive Plan.](http://www.sec.gov/Archives/edgar/data/906107/000090610712000023/eqr-2012630xexhibit101.htm) | | Included as Exhibit 10.1 to Equity Residential's and ERP Operating Limited Partnership's Form 10-Q for the quarterly period ended June 30, 2012. |

| [removed: 10.9] [added: 10.7] | * | [Second Amendment to 2011 Share Incentive Plan.](http://www.sec.gov/Archives/edgar/data/906107/000090610713000034/exhibit101.htm) | | Included as Exhibit 10.1 to Equity Residential's and ERP Operating Limited Partnership's Form 10-Q for the quarterly period ended September 30, 2013. |

| [removed: 10.10] [added: 10.8] | * | [Third Amendment to 2011 Share Incentive Plan.](http://www.sec.gov/Archives/edgar/data/906107/000090610714000012/eqr-2014331xexhibit101.htm) | | Included as Exhibit 10.1 to Equity Residential's and ERP Operating Limited Partnership's Form 10-Q for the quarterly period ended March 31, 2014. |

| [removed: 10.11] [added: 10.9] | * | [Fourth Amendment to 2011 Share Incentive Plan.](http://www.sec.gov/Archives/edgar/data/906107/000090610714000023/exhibit1013q14.htm) | | Included as Exhibit 10.1 to Equity Residential's and ERP Operating Limited Partnership's Form 10-Q for the quarterly period ended September 30, 2014. |

| [removed: 10.12] [added: 10.10] | * | [Fifth Amendment to 2011 Share Incentive Plan.](http://www.sec.gov/Archives/edgar/data/906107/000090610716000044/eqr-exhibit101x2q16.htm) | | Included as Exhibit 10.1 to Equity Residential's and ERP Operating Limited Partnership's Form 10-Q for the quarterly period ended June 30, 2016. |

| [removed: 10.13] [added: 10.11] | * | [Sixth Amendment to 2011 Share Incentive Plan.](http://www.sec.gov/Archives/edgar/data/906107/000090610717000007/exhibit1018eqr-2016.htm) | | Included as Exhibit 10.18 to Equity Residential's and ERP Operating Limited Partnership's Form 10-K for the year ended December 31, 2016. |

| [removed: 10.14] [added: 10.12] | * | [Seventh Amendment to 2011 Share Incentive Plan.](http://www.sec.gov/Archives/edgar/data/906107/000156459017020797/eqr-ex101_95.htm) | | Included as Exhibit 10.1 to Equity Residential's and ERP Operating Limited Partnership's Form 10-Q for the quarterly period ended September 30, 2017. |

| [removed: 10.15] [added: 10.13] | * | [Equity Residential Second Restated 2002 Share Incentive Plan dated December 10, 2008.](http://www.sec.gov/Archives/edgar/data/906107/000119312509038255/dex1015.htm) | | Included as Exhibit 10.15 to Equity Residential's Form 10-K for the year ended December 31, 2008. |

| [removed: 10.16] [added: 10.14] | * | [First Amendment to Second Restated 2002 Share Incentive Plan.](http://www.sec.gov/Archives/edgar/data/906107/000095012310100488/c60163exv10w1.htm) | | Included as Exhibit 10.1 to Equity Residential's Form 10-Q for the quarterly period ended September 30, 2010. |

| [removed: 10.17] [added: 10.15] | * | [Second Amendment to Second Restated 2002 Share Incentive Plan.](http://www.sec.gov/Archives/edgar/data/906107/000095012311073326/c64621exv10w3.htm) | | Included as Exhibit 10.3 to Equity Residential's Form 10-Q for the quarterly period ended June 30, 2011. |

| [removed: 10.18] [added: 10.16] | * | [Third Amendment to Second Restated 2002 Share Incentive Plan.](http://www.sec.gov/Archives/edgar/data/906107/000090610712000023/eqr-2012630xexhibit102.htm) | | Included as Exhibit 10.2 to Equity Residential's and ERP Operating Limited Partnership's Form 10-Q for the quarterly period ended June 30, 2012. |

| [removed: 10.19] [added: 10.17] | * | [Fourth Amendment to Second Restated 2002 Share Incentive Plan.](http://www.sec.gov/Archives/edgar/data/906107/000090610713000034/exhibit102.htm) | | Included as Exhibit 10.2 to Equity Residential's and ERP Operating Limited Partnership's Form 10-Q for the quarterly period ended September 30, 2013. |

| [removed: 10.20] [added: 10.18] | * | [Form of 2018 Long-Term Incentive Plan Award Agreement.](http://www.sec.gov/Archives/edgar/data/906107/000156459018010687/eqr-ex101_301.htm) | | Included as Exhibit 10.1 to Equity Residential's and ERP Operating Limited Partnership's Form 10-Q for the quarterly period ended March 31, 2018. |

| [removed: 10.21] [added: 10.19] | * | [Form of Change in Control/Severance Agreement between the Company and other executive officers.](http://www.sec.gov/Archives/edgar/data/906107/000091205702009068/a2072511zex-10_13.txt) | | Included as Exhibit 10.13 to Equity Residential's Form 10-K for the year ended December 31, 2001. |

| [removed: 10.22] [added: 10.20] | * | [Form of First Amendment to Amended and Restated Change in Control/Severance Agreement with each executive officer.](http://www.sec.gov/Archives/edgar/data/906107/000119312509102717/dex101.htm) | | Included as Exhibit 10.1 to Equity Residential's Form 10-Q for the quarterly period ended March 31, 2009. |

| [removed: 10.23] [added: 10.21] | * | [Form of Indemnification Agreement between the Company and each trustee and executive officer.](http://www.sec.gov/Archives/edgar/data/906107/000110465904007155/a04-2963_2ex10d18.htm) | | Included as Exhibit 10.18 to Equity Residential's Form 10-K for the year ended December 31, 2003. |

| [removed: 10.24] [added: 10.22] | * | [Form of Letter Agreement between Equity Residential and Alan W. George.](http://www.sec.gov/Archives/edgar/data/906107/000119312508227703/dex103.htm) | | Included as Exhibit 10.3 to Equity Residential's Form 10-Q for the quarterly period ended September 30, 2008. |

| [removed: 10.25] [added: 10.23] | * | [Form of Executive Retirement Benefits Agreement.](http://www.sec.gov/Archives/edgar/data/906107/000110465907014819/a07-5259_1ex10d24.htm) | | Included as Exhibit 10.24 to Equity Residential's Form 10-K for the year ended December 31, 2006. |

| [removed: 10.26] [added: 10.24] | * | [Retirement Benefits Agreement between Samuel Zell and the Company dated October 18, 2001.](http://www.sec.gov/Archives/edgar/data/906107/000091205702009068/a2072511zex-10_18.txt) | | Included as Exhibit 10.18 to Equity Residential's Form 10-K for the year ended December 31, 2001. |

| [removed: 10.27] [added: 10.25] | * | [removed: [Rule of 70] [added: [Age 62] Retirement Agreement, dated [removed: February 28,] [added: September 4,] 2018, by and between Equity Residential and David [removed: S. Santee.](http://www.sec.gov/Archives/edgar/data/906107/000156459018010687/eqr-ex102_300.htm)] [added: J. Neithercut.](http://www.sec.gov/Archives/edgar/data/906107/000156459018025620/eqr-ex101_20.htm)] | | Included as Exhibit [removed: 10.2] [added: 10.1] to Equity Residential's and ERP Operating Limited Partnership's Form 10-Q for the quarterly period ended [removed: March 31,] [added: September 30,] 2018. |

| [removed: 10.28] [added: 10.26] | * | [Age 62 Retirement Agreement, dated [removed: September 4, 2018,] [added: February 27, 2020,] by and between Equity Residential and [removed: David J. Neithercut.](http://www.sec.gov/Archives/edgar/data/906107/000156459018025620/eqr-ex101_20.htm)] [added: Alan W. George.](http://www.sec.gov/Archives/edgar/data/906107/000156459020022867/eqr-ex101_17.htm)] | | Included as Exhibit 10.1 to Equity Residential's and ERP Operating Limited Partnership's Form 10-Q for the quarterly period ended [removed: September 30, 2018.] [added: March 31, 2020.] |

| [removed: 10.29] [added: 10.27] | * | [The Equity Residential Supplemental Executive Retirement Plan as Amended and Restated effective April 1, 2017.](http://www.sec.gov/Archives/edgar/data/906107/000156459017015496/eqr-ex102_61.htm) | | Included as Exhibit 10.2 to Equity Residential's and ERP Operating Limited Partnership's Form 10-Q for the quarterly period ended June 30, 2017. |

| [removed: 10.30] [added: 10.29] | * | [The Equity Residential Grandfathered Supplemental Executive Retirement Plan as Amended and Restated effective January 1, 2005.](http://www.sec.gov/Archives/edgar/data/906107/000110465908031090/a08-13376_1ex10d2.htm) | | Included as Exhibit 10.2 to Equity Residential's Form 10-Q for the quarterly period ended March 31, 2008. |

| [removed: 10.31] [added: 10.30] | | [Distribution Agreement, dated June 6, 2019, among the Company, the Operating Partnership, JPMorgan Chase Bank, National Association, London Branch, J.P. Morgan Securities LLC, Barclays Bank PLC, Barclays Capital Inc., Bank of America, N.A., BofA Securities, Inc., The Bank of New York Mellon, BNY Mellon Capital Markets, LLC, Morgan Stanley & Co. LLC, MUFG Securities EMEA plc, MUFG Securities Americas Inc., The Bank of Nova Scotia, Scotia Capital (USA) Inc., UBS AG, London Branch and UBS Securities LLC](http://www.sec.gov/Archives/edgar/data/906107/000119312519166735/d759345dex11.htm). | | Included as Exhibit 1.1 to Equity Residential's and ERP Operating Limited Partnership's Form 8-K dated and filed on June 6, 2019. |

| [removed: 10.32] [added: 10.31] | | [Form of Master Forward Sale Confirmation](http://www.sec.gov/Archives/edgar/data/906107/000119312519166735/d759345dex12.htm). | | Included as Exhibit 1.2 to Equity Residential's and ERP Operating Limited Partnership's Form 8-K dated and filed on June 6, 2019. |

| [removed: 10.33] [added: 10.32] | | [Archstone Residual JV, LLC Limited Liability Company Agreement.](http://www.sec.gov/Archives/edgar/data/906107/000119312513084766/d491312dex103.htm) | | Included as Exhibit 10.3 to Equity Residential's and ERP Operating Limited Partnership's Form 8-K dated February 27, 2013, filed on February 28, 2013. |

| [removed: 10.34] [added: 10.33] | | [Archstone Parallel Residual JV, LLC Limited Liability Company Agreement.](http://www.sec.gov/Archives/edgar/data/906107/000119312513084766/d491312dex104.htm) | | Included as Exhibit 10.4 to Equity Residential's and ERP Operating Limited Partnership's Form 8-K dated February 27, 2013, filed on February 28, 2013. |

| [removed: 10.35] [added: 10.34] | | [Archstone Parallel Residual JV 2, LLC Limited Liability Company Agreement.](http://www.sec.gov/Archives/edgar/data/906107/000119312513084766/d491312dex105.htm) | | Included as Exhibit 10.5 to Equity Residential's and ERP Operating Limited Partnership's Form 8-K dated February 27, 2013, filed on February 28, 2013. |

| [removed: 10.36] [added: 10.35] | | [Legacy Holdings JV, LLC Limited Liability Company Agreement.](http://www.sec.gov/Archives/edgar/data/906107/000119312513084766/d491312dex106.htm) | | Included as Exhibit 10.6 to Equity Residential's and ERP Operating Limited Partnership's Form 8-K dated February 27, 2013, filed on February 28, 2013. |

| 21 | | [List of Subsidiaries of Equity Residential and ERP Operating Limited [removed: Partnership.](https://www.sec.gov/Archives/edgar/data/906107/000156459020005562/eqr-ex21_6.htm)] [added: Partnership.](https://www.sec.gov/Archives/edgar/data/906107/000156459021006679/eqr-ex21_13.htm)] | | Attached herein. |

| 23.1 | | [Consent of Ernst & Young LLP - Equity [removed: Residential.](https://www.sec.gov/Archives/edgar/data/906107/000156459020005562/eqr-ex231_8.htm)] [added: Residential.](https://www.sec.gov/Archives/edgar/data/906107/000156459021006679/eqr-ex231_12.htm)] | | Attached herein. |

| 23.2 | | [Consent of Ernst & Young LLP - ERP Operating Limited [removed: Partnership.](https://www.sec.gov/Archives/edgar/data/906107/000156459020005562/eqr-ex232_16.htm)] [added: Partnership.](https://www.sec.gov/Archives/edgar/data/906107/000156459021006679/eqr-ex232_19.htm)] | | Attached herein. |

| 3.4 | | [Second Amendment to Eighth Amended and Restated Bylaws of Equity Residential, effective as of May 4, 2020.](http://www.sec.gov/Archives/edgar/data/0000906107/000119312520137062/d924277dex31.htm) | | Included as Exhibit 3.1 to Equity Residential's Form 8-K dated May 4, 2020, filed on May 8, 2020. |

| 10.28 | * | [Amendment to the Equity Residential Supplemental Executive Retirement Plan, effective as of June 1, 2020.](http://www.sec.gov/Archives/edgar/data/906107/000156459020035511/eqr-ex101_104.htm) | | Included as Exhibit 10.1 to Equity Residential's and ERP Operating Limited Partnership's Form 10-Q for the quarterly period ended June 30, 2020. |

| | | Date: | | February 18, 2021 |

| /s/ Angela Aman | | Trustee | | February 18, 2021 |

| Angela Aman | | | | |

| | | | | |

| February 18, 2021 | | |

Critical Audit Matter

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

The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the account or disclosure to which it relates.

| | Impairment of Long-Lived Assets | |

| Description of the Matter | At December 31, 2020, the Operating Partnership’s net investment in real estate was approximately $19.3 billion. As more fully described in Note 2 to the consolidated financial statements, the Operating Partnership periodically evaluates its long-lived assets, including its investment in real estate, for impairment. The judgments regarding the existence of impairment indicators are based on factors such as operational performance, market conditions, legal and environmental concerns, the Operating Partnership’s intent and ability to hold the related asset, as well as any significant cost overruns on development properties. If the expected future undiscounted cash flows are less than the carrying amount of the long-lived asset, an impairment loss is recognized for the difference between the estimated fair value and the carrying amount. Auditing the Operating Partnership’s process to evaluate long-lived assets for impairment was complex due to a high degree of subjectivity in determining whether indicators of impairment were present, and in determining the future undiscounted cash flows and estimated fair values, if necessary, of long-lived assets where impairment indicators were determined to be present. In particular, these estimates were sensitive to significant assumptions, including the estimation of future rental revenues, operating expenses and capitalization rates, which are affected by expectations about future market or economic conditions. | |

| | | |

| How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Operating Partnership’s long-lived asset impairment evaluation and measurement process, including controls over management’s determination and review of the significant assumptions used in the analyses and described above. To test the Operating Partnership’s evaluation of long-lived assets for impairment, we performed audit procedures that included, among others, evaluating the indicators of impairment identified by management and testing the significant assumptions and completeness and accuracy of operating data used by the Operating Partnership in its analyses. We compared the significant assumptions used by management to current market data and performed sensitivity analyses of certain significant assumptions as discussed above. We also involved our valuation specialists to assist in evaluating certain assumptions used, including future rental revenues and operating expenses, and capitalization rates. | |

| February 18, 2021 | | |

| | | |

| February 18, 2021 | | |

| | | |

| February 18, 2021 | | |

| Cash and cash equivalents | | | 42,591 | | | | 45,753 | |

| Accounts payable and accrued expenses | | | 107,366 | | | | 94,350 | |

| Operating income | | | 1,317,990 | | | | 1,356,160 | | | | 1,114,617 | |

| Net income | | $ | 962,501 | | | $ | 1,009,708 | | | $ | 685,192 | |

| Depreciation | | | 820,832 | | | | 831,083 | | | | 785,725 | |

| Cash and cash equivalents and restricted deposits, end of year | | $ | 99,728 | | | $ | 116,999 | | | $ | 116,313 | |

| Net income attributable to controlling interests | | | 913,636 | | | | 970,377 | | | | 657,535 | |

| Unrealized holding gains (losses) arising during the year | | | (1,190 | ) | | | (33,765 | ) | | | 5,174 | |

| Losses reclassified into earnings from other comprehensive income | | | 35,087 | | | | 21,188 | | | | 18,452 | |

(Amounts in thousands except per share data)

| | | 2020 | | | | 2019 | | | | 2018 | | |

| Balance, end of year | | $ | 233,162 | | | $ | 227,837 | | | $ | 228,738 | |

| Land | | $ | 5,785,367 | | | $ | 5,936,188 | |

| Depreciable property | | | 20,920,654 | | | | 21,319,101 | |

| Projects under development | | | 411,134 | | | | 181,630 | |

| Land held for development | | | 86,170 | | | | 96,688 | |

| Investment in real estate | | | 27,203,325 | | | | 27,533,607 | |

| Accumulated depreciation | | | (7,859,657 | ) | | | (7,276,786 | ) |

| Cash and cash equivalents | | | 42,591 | | | | 45,753 | |

| Restricted deposits | | | 57,137 | | | | 71,246 | |

| Other assets | | | 291,426 | | | | 233,937 | |

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

| 10.2 | * | Noncompetition Agreement (Spector). | | Included as an exhibit to Equity Residential's Form S-11 Registration Statement, File No. 33-63158. |

| 10.3 | * | Form of Noncompetition Agreement (other officers). | | Included as an exhibit to Equity Residential's Form S-11 Registration Statement, File No. 33-63158. |

EQUITY RESIDENTIAL

| /s/ Charles L. Atwood | | Trustee | | February 20, 2020 |

| Charles L. Atwood | | | | |

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

Adoption of New Accounting Standard

As discussed in Note 2 to the consolidated financial statements, the Company changed its method of accounting for leases effective January 1, 2019.

| February 20, 2020 | | |

As discussed in Note 2 to the consolidated financial statements, the Operating Partnership changed its method of accounting for leases effective January 1, 2019.

| ASSETS | | | | | | | | |

| | | | | | | | | |

| Fee and asset management | | | 384 | | | | 753 | | | | 717 | |

| Total revenues | | | 2,701,075 | | | | 2,578,434 | | | | 2,471,406 | |

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

| Operating income | | | 1,356,544 | | | | 1,115,370 | | | | 1,004,528 | |

(Amounts in thousands)

| --- | --- |

| | | | 309 | | | | 79,962 | |

These costs are reflected on the balance sheets as construction-in-progress for each specific property.

The Company expenses as incurred all payroll costs of on-site employees working directly at our properties, except as noted above on our development properties prior to certificate of occupancy issuance and on specific major renovations at selected properties when additional incremental employees are hired.

| | • | Fee and asset management revenue – The Company received management fee revenue as the property manager for two unconsolidated joint ventures for which it had an ownership interest during part of the year but no longer owns as of December 31, 2019. |

The Company’s rental income detail by leasing and revenue recognition standards along with the percentages of rental income are disclosed in the table below for the years ended December 31, 2019 and 2018 (amounts in thousands).

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

| Residential and retail rent | | $ | 2,486,189 | | | | | | | $ | 2,369,552 | | | | | |

| Utility recoveries ("RUBS") | | | 68,576 | | | | | | | | 63,218 | | | | | |

| Parking rent | | | 37,905 | | | | | | | | 33,757 | | | | | |

| Leasing standard (1) | | | 2,608,103 | | | | 96.6 | % | | | 2,481,386 | | | | 96.3 | % |

| Revenue recognition standard | | | 92,588 | | | | 3.4 | % | | | 96,295 | | | | 3.7 | % |

The standard requires the following:

| | • | Lessors – Leases are accounted for using an approach that is substantially equivalent to existing guidance for operating, sales-type and financing leases, but aligned with the revenue recognition standard. Lessors are required to allocate lease payments to separate lease and non-lease components of each lease agreement, with the non-lease components evaluated under the revenue recognition standard. |

| | • | Lessees – Leases are accounted for using a dual approach, classifying leases as either operating or finance based on the principle of whether or not the lease is effectively a financed purchase of the leased asset by the lessee. This classification determines whether the lease expense is recognized on a straight-line basis over the term of the lease (for operating leases) or based on an effective interest method (for finance leases). A lessee is also required to record a right-of-use asset and a lease liability on its balance sheet for all leases with a term of greater than 12 months regardless of their classification as operating or finance leases. Leases with a term of 12 months or less are accounted for similar to existing guidance for operating leases. |

| | | January 1, 2019 | | | | Balance Sheet Reclass: |

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

| Reclassifications: | | | | | | |

| Prepaid ground leases | | | 17,886 | | | Other Assets |

| Ground lease intangibles – below market, net | | | 166,230 | | | Other Assets |

| Ground lease intangibles – above market, net | | | (2,110 | ) | | Other Liabilities |

| Straight-line rent liabilities (1) | | | (26,092 | ) | | Other Liabilities |