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Cover and table of contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025

OR

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to

Commission File Number: 1-12252 (Equity Residential)

Commission File Number: 0-24920 (ERP Operating Limited Partnership)

EQUITY RESIDENTIAL

ERP OPERATING LIMITED PARTNERSHIP

(Exact name of registrant as specified in its charter)

Maryland (Equity Residential)13-3675988 (Equity Residential)
Illinois (ERP Operating Limited Partnership)36-3894853 (ERP Operating Limited Partnership)
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
Two North Riverside Plaza**,** Chicago**,** Illinois 60606(312) 474-1300
(Address of principal executive offices) (Zip Code)(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Shares of Beneficial Interest, $0.01 Par Value (Equity Residential)EQRNew York Stock Exchange
7.57% Notes due August 15, 2026 (ERP Operating Limited Partnership)N/ANew York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Equity Residential Yes ☒ No ☐ERP Operating Limited Partnership Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Equity Residential Yes ☒ No ☐ERP Operating Limited Partnership Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Equity Residential:

Large accelerated filer☒Accelerated filer☐
Non-accelerated filer☐Smaller reporting company☐
Emerging growth company☐

l

ERP Operating Limited Partnership:

Large accelerated filer☐Accelerated filer☐
Non-accelerated filer☒Smaller reporting company☐
Emerging growth company☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Equity Residential ☐ERP Operating Limited Partnership ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Equity Residential Yes ☐ No ☒ERP Operating Limited Partnership Yes ☐ No ☒

The number of EQR Common Shares of Beneficial Interest, $0.01 par value, outstanding on July 31, 2025 was 381,898,057.

EXPLANATORY NOTE

This report combines the reports on Form 10-Q for the quarterly period ended June 30, 2025 of Equity Residential and ERP Operating Limited Partnership. Unless stated otherwise or the context otherwise requires, references to “EQR” mean Equity Residential, a Maryland real estate investment trust (“REIT”), and references to “ERPOP” mean ERP Operating Limited Partnership, an Illinois limited partnership. References to the “Company,” “we,” “us” or “our” mean collectively EQR, ERPOP and those entities/subsidiaries owned or controlled by EQR and/or ERPOP. References to the “Operating Partnership” mean collectively ERPOP and those entities/subsidiaries owned or controlled by ERPOP. The following chart illustrates the Company’s and the Operating Partnership’s corporate structure:

img138328075_0.jpg

EQR is the general partner of, and as of June 30, 2025 owned an approximate 97.0% ownership interest in, ERPOP. The remaining 3.0% interest is owned by limited partners. As the sole general partner of ERPOP, EQR has exclusive control of ERPOP’s day-to-day management. Management operates the Company and the Operating Partnership as one business. The management of EQR consists of the same members as the management of ERPOP.

The Company is structured as an umbrella partnership REIT (“UPREIT”) and EQR contributes all net proceeds from its various equity offerings to ERPOP. In return for those contributions, EQR receives a number of OP Units (see definition below) in ERPOP equal to the number of Common Shares it has issued in the equity offering. The Company may acquire properties in transactions that include the issuance of OP Units as consideration for the acquired properties. Such transactions may, in certain circumstances, enable the sellers to defer in whole or in part, the recognition of taxable income or gain that might otherwise result from the sales. This is one of the reasons why the Company is structured in the manner shown above. Based on the terms of ERPOP’s partnership agreement, OP Units can be exchanged with Common Shares on a one-for-one basis because the Company maintains a one-for-one relationship between the OP Units of ERPOP issued to EQR and the outstanding Common Shares.

The Company believes that combining the reports on Form 10-Q of EQR and ERPOP into this single report provides the following benefits:

  • enhances investors’ understanding of the Company and the Operating Partnership by enabling investors to view the business as a whole in the same manner as management views and operates the business;

  • eliminates duplicative disclosure and provides a more streamlined and readable presentation since a substantial portion of the disclosure applies to both the Company and the Operating Partnership; and

  • creates time and cost efficiencies through the preparation of one combined report instead of two separate reports.

The Company believes it is important to understand the few differences between EQR and ERPOP in the context of how EQR and ERPOP operate as a consolidated company. All of the Company’s property ownership, development and related business operations are conducted through the Operating Partnership and EQR has no material assets or liabilities other than its investment in ERPOP. EQR’s primary function is acting as the general partner of ERPOP. EQR also issues equity from time to time, the net proceeds of which it is obligated to contribute to ERPOP. EQR does not have any indebtedness as all debt is incurred by the Operating Partnership. The Operating Partnership holds substantially all of the assets of the Company, including the Company’s ownership interests in its joint ventures. The Operating Partnership conducts the operations of the business and is structured as a partnership with no publicly traded equity. Except for the net proceeds from equity offerings by EQR (which are contributed to the capital of ERPOP in exchange for additional partnership interests in ERPOP (“OP Units”) (on a one-for-one Common Share per OP Unit basis) or additional preference units in ERPOP (on a one-for-one preferred share per preference unit basis)), the Operating Partnership generates all remaining capital required by the Company’s business. These sources include the Operating Partnership’s working capital, net cash provided by operating activities, borrowings under its revolving credit facility and/or commercial paper program, the issuance of secured and unsecured debt and partnership interests, and proceeds received from disposition of certain properties and joint venture interests.

Shareholders’ equity, partners’ capital and noncontrolling interests are the main areas of difference between the consolidated financial statements of the Company and those of the Operating Partnership. The limited partners of the Operating Partnership are accounted for as partners’ capital in the Operating Partnership’s financial statements and as noncontrolling interests in the Company’s financial statements. The noncontrolling interests in the Operating Partnership’s financial statements include the interests of unaffiliated partners in various consolidated partnerships. The noncontrolling interests in the Company’s financial statements include the same noncontrolling interests at the Operating Partnership level and limited partner OP Unit holders of the Operating Partnership. The differences between shareholders’ equity and partners’ capital result from differences in the equity issued at the Company and Operating Partnership levels.

To help investors understand the differences between the Company and the Operating Partnership, this report provides separate consolidated financial statements for the Company and the Operating Partnership; a single set of consolidated notes to such financial statements that includes separate discussions of each entity’s debt, noncontrolling interests and shareholders’ equity or partners’ capital, as applicable; and a combined Management’s Discussion and Analysis of Financial Condition and Results of Operations section that includes discrete information related to each entity.

This report also includes separate Part I, Item 4, Controls and Procedures, sections and separate Exhibits 31 and 32 certifications for each of the Company and the Operating Partnership in order to establish that the requisite certifications have been made and that the Company and the Operating Partnership are compliant with Rule 13a-15 or Rule 15d-15 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and 18 U.S.C. §1350.

In order to highlight the differences between the Company and the Operating Partnership, the separate sections in this report for the Company and the Operating Partnership specifically refer to the Company and the Operating Partnership. In the sections that combine disclosure of the Company and the Operating Partnership, this report refers to actions or holdings as being actions or holdings of the Company. Although the Operating Partnership is generally the entity that directly or indirectly enters into contracts and joint ventures and holds assets and debt, reference to the Company is appropriate because the Company is one business and the Company operates that business through the Operating Partnership.

As general partner with control of ERPOP, EQR consolidates ERPOP for financial reporting purposes, and EQR essentially has no assets or liabilities other than its investment in ERPOP. Therefore, the assets and liabilities of the Company and the Operating Partnership are the same on their respective financial statements. The separate discussions of the Company and the Operating Partnership in this report should be read in conjunction with each other to understand the results of the Company on a consolidated basis and how management operates the Company.

TABLE OF CONTENTS

PAGE
PART I.
Item 1. Financial Statements of Equity Residential:
Consolidated Balance Sheets as of June 30, 2025 and December 31, 20242
Consolidated Statements of Operations and Comprehensive Income for the six months and quarters ended June 30, 2025 and 20243
Consolidated Statements of Cash Flows for the six months ended June 30, 2025 and 20245
Consolidated Statements of Changes in Equity for the six months and quarters ended June 30, 2025 and 20249
Financial Statements of ERP Operating Limited Partnership:
Consolidated Balance Sheets as of June 30, 2025 and December 31, 202411
Consolidated Statements of Operations and Comprehensive Income for the six months and quarters ended June 30, 2025 and 202412
Consolidated Statements of Cash Flows for the six months ended June 30, 2025 and 202414
Consolidated Statements of Changes in Capital for the six months and quarters ended June 30, 2025 and 202418
Notes to Consolidated Financial Statements of Equity Residential and ERP Operating Limited Partnership20
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations39
Item 3. Quantitative and Qualitative Disclosures about Market Risk48
Item 4. Controls and Procedures48
PART II.
Item 1. Legal Proceedings49
Item 1A. Risk Factors49
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds49
Item 3. Defaults Upon Senior Securities49
Item 4. Mine Safety Disclosures49
Item 5. Other Information49
Item 6. Exhibits49

EQUITY RESIDENTIAL

CONSOLIDATED B****ALANCE SHEETS

(Amounts in thousands except for share amounts)

(Unaudited)

June 30,December 31,
20252024
ASSETS
Land$5,636,458$5,606,531
Depreciable property24,711,74024,039,412
Projects under development168,626261,706
Land held for development59,95663,142
Investment in real estate30,576,78029,970,791
Accumulated depreciation(10,816,579)(10,412,463)
Investment in real estate, net19,760,20119,558,328
Investments in unconsolidated entities403,768386,531
Cash and cash equivalents31,27662,302
Restricted deposits100,67897,864
Right-of-use assets449,577455,445
Other assets282,014273,706
Total assets$21,027,514$20,834,176
LIABILITIES AND EQUITY
Liabilities:
Mortgage notes payable, net$1,594,765$1,630,690
Notes, net5,994,9145,947,376
Line of credit and commercial paper782,147543,679
Accounts payable and accrued expenses108,79299,347
Accrued interest payable75,69474,176
Lease liabilities302,847304,897
Other liabilities290,101310,559
Security deposits81,17975,611
Distributions payable270,695263,494
Total liabilities9,501,1349,249,829
Commitments and contingencies
Redeemable Noncontrolling Interests – Operating Partnership317,905338,563
Equity:
Shareholders' equity:
Preferred Shares of beneficial interest, $0.01 par value;100,000,000 shares authorized; 343,100 shares issued and outstanding as of June 30, 2025 and December 31, 202417,15517,155
Common Shares of beneficial interest, $0.01 par value;1,000,000,000 shares authorized; 379,980,440 shares issued and outstanding as of June 30, 2025 and 379,475,383 shares issued and outstanding as of December 31, 20243,8003,795
Paid in capital9,656,2729,611,826
Retained earnings1,329,3791,407,570
Accumulated other comprehensive income (loss)1,6154,214
Total shareholders’ equity11,008,22111,044,560
Noncontrolling Interests:
Operating Partnership202,717201,942
Partially Owned Properties(2,463)(718)
Total Noncontrolling Interests200,254201,224
Total equity11,208,47511,245,784
Total liabilities and equity$21,027,514$20,834,176

See accompanying notes

EQUITY RESIDENTIAL

CONSOLIDATED STATEMENTS OF O****PERATIONS AND COMPREHENSIVE INCOME

(Amounts in thousands except per share data)

(Unaudited)

Six Months Ended June 30,Quarter Ended June 30,
2025202420252024
REVENUES
Rental income$1,529,637$1,464,981$768,827$734,163
EXPENSES
Property and maintenance280,247261,128136,274126,498
Real estate taxes and insurance224,084214,498112,332105,571
Property management70,60268,96934,78633,511
General and administrative36,78634,35118,53118,631
Depreciation497,635450,093240,889224,398
Total expenses1,109,3541,029,039542,812508,609
Net gain (loss) on sales of real estate properties212,432227,99458,28039,809
Interest and other income3,82110,6572,1291,328
Other expenses(8,961)(45,123)(4,805)(13,385)
Interest:
Expense incurred, net(147,431)(133,040)(75,317)(65,828)
Amortization of deferred financing costs(4,247)(3,836)(2,103)(1,918)
Income before income and other taxes, income (loss) from investments in unconsolidated entities and net gain (loss) on sales of land parcels475,897492,594204,199185,560
Income and other tax (expense) benefit(829)(635)(407)(331)
Income (loss) from investments in unconsolidated entities(11,407)(3,372)(4,996)(1,674)
Net gain (loss) on sales of land parcels(78)—(11)—
Net income463,583488,587198,785183,555
Net (income) loss attributable to Noncontrolling Interests:
Operating Partnership(12,328)(13,278)(5,226)(5,003)
Partially Owned Properties(2,307)(2,039)(1,203)(1,069)
Net income attributable to controlling interests448,948473,270192,356177,483
Preferred distributions(711)(902)(355)(355)
Premium on redemption of Preferred Shares—(1,444)——
Net income available to Common Shares$448,237$470,924$192,001$177,128
Earnings per share – basic:
Net income available to Common Shares$1.18$1.24$0.51$0.47
Weighted average Common Shares outstanding379,359378,699379,508378,578
Earnings per share – diluted:
Net income available to Common Shares$1.18$1.24$0.50$0.47
Weighted average Common Shares outstanding391,345390,548391,498390,542

See accompanying notes

EQUITY RESIDENTIAL

CONSOLIDATED STATEMENTS OF OPERATIO****NS AND COMPREHENSIVE INCOME (Continued)

(Amounts in thousands except per share data)

(Unaudited)

Six Months Ended June 30,Quarter Ended June 30,
2025202420252024
Comprehensive income:
Net income$463,583$488,587$198,785$183,555
Other comprehensive income (loss):
Other comprehensive income (loss) – derivative instruments:
Unrealized holding gains (losses) arising during the period(3,550)—(2,046)—
Losses reclassified into earnings from other comprehensive income9511,210265600
Other comprehensive income (loss)(2,599)1,210(1,781)600
Comprehensive income460,984489,797197,004184,155
Comprehensive (income) attributable to Noncontrolling Interests(14,566)(15,350)(6,382)(6,088)
Comprehensive income attributable to controlling interests$446,418$474,447$190,622$178,067

See accompanying notes

EQUITY RESIDENTIAL

CONSOLIDATED STATEM****ENTS OF CASH FLOWS

(Amounts in thousands)

(Unaudited)

Six Months Ended June 30,
20252024
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income$463,583$488,587
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation497,635450,093
Amortization of deferred financing costs4,2473,836
Amortization of discounts and premiums on debt2,6372,536
Amortization of deferred settlements on derivative instruments9451,204
Amortization of right-of-use assets6,3956,470
Write-off of pursuit costs2,0481,369
(Income) loss from investments in unconsolidated entities11,4073,372
Distributions from unconsolidated entities – return on capital243281
Net (gain) loss on sales of real estate properties(212,432)(227,994)
Net (gain) loss on sales of land parcels78—
Realized (gain) loss on investment securities491,316
Unrealized (gain) loss on investment securities—(5,745)
Compensation paid with Company Common Shares21,56421,350
Changes in assets and liabilities:
(Increase) decrease in other assets(18,706)30,297
Increase (decrease) in accounts payable and accrued expenses10,90118,780
Increase (decrease) in accrued interest payable1,518(131)
Increase (decrease) in lease liabilities(1,106)(1,020)
Increase (decrease) in other liabilities(11,407)22,697
Increase (decrease) in security deposits5,471670
Net cash provided by operating activities785,070817,968
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in real estate – acquisitions(534,855)(63,507)
Investment in real estate – development/other(59,713)(55,253)
Capital expenditures to real estate(144,368)(153,304)
Non-real estate capital additions(1,019)(921)
Interest capitalized for real estate and unconsolidated entities under development(6,663)(6,894)
Proceeds from disposition of real estate, net343,064330,128
Investments in unconsolidated entities – acquisitions—(31,286)
Investments in unconsolidated entities – development/other(62,050)(28,793)
Distributions from unconsolidated entities – return of capital33116
Proceeds from sale of investment securities3597,457
Consolidation of previously unconsolidated entities(54,081)—
Net cash provided by (used for) investing activities(518,995)(2,357)

See accompanying notes

EQUITY RESIDENTIAL

CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(Amounts in thousands)

(Unaudited)

Six Months Ended June 30,
20252024
CASH FLOWS FROM FINANCING ACTIVITIES:
Debt financing costs$(4,518)$—
Mortgage notes payable, net:
Lump sum payoffs(37,940)—
Notes, net:
Proceeds498,580—
Lump sum payoffs(450,000)—
Line of credit and commercial paper:
Commercial paper proceeds18,803,9633,532,753
Commercial paper repayments(18,565,495)(3,771,000)
Proceeds from (payments on) settlement of derivative instruments(3,550)—
Finance ground lease principal payments(1,471)(1,438)
Proceeds from Employee Share Purchase Plan (ESPP)1,4132,449
Proceeds from exercise of options5,3576,480
Common Shares repurchased and retired—(38,474)
Redemption of Preferred Shares—(20,125)
Premium on redemption of Preferred Shares—(1,444)
Payment of offering costs(481)—
Other financing activities, net(53)(45)
Contributions – Noncontrolling Interests – Partially Owned Properties—458
Contributions – Noncontrolling Interests – Operating Partnership42
Distributions:
Common Shares(519,437)(507,111)
Preferred Shares(711)(1,320)
Noncontrolling Interests – Operating Partnership(15,949)(15,629)
Noncontrolling Interests – Partially Owned Properties(3,999)(2,741)
Net cash provided by (used for) financing activities(294,287)(817,185)
Net increase (decrease) in cash and cash equivalents and restricted deposits(28,212)(1,574)
Cash and cash equivalents and restricted deposits, beginning of period160,166139,995
Cash and cash equivalents and restricted deposits, end of period$131,954$138,421
Cash and cash equivalents and restricted deposits, end of period
Cash and cash equivalents$31,276$38,298
Restricted deposits100,678100,123
Total cash and cash equivalents and restricted deposits, end of period$131,954$138,421

See accompanying notes

EQUITY RESIDENTIAL

CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(Amounts in thousands)

(Unaudited)

Six Months Ended June 30,
20252024
SUPPLEMENTAL INFORMATION:
Cash paid for interest, net of amounts capitalized$133,733$120,955
Net cash paid (received) for income and other taxes$920$877
Amortization of deferred financing costs:
Other assets$1,393$1,392
Mortgage notes payable, net$611$524
Notes, net$2,243$1,920
Amortization of discounts and premiums on debt:
Mortgage notes payable, net$1,404$1,412
Notes, net$1,233$1,124
Amortization of deferred settlements on derivative instruments:
Other liabilities$(6)$(6)
Accumulated other comprehensive income$951$1,210
Write-off of pursuit costs:
Investment in real estate, net$187$319
Investments in unconsolidated entities$1,740$866
Other assets$121$184
(Income) loss from investments in unconsolidated entities:
Investments in unconsolidated entities$10,804$2,736
Other liabilities$603$636
Realized/unrealized (gain) loss on derivative instruments:
Other assets$(89)$—
Other liabilities$3,639$—
Accumulated other comprehensive income$(3,550)$—
Interest capitalized for real estate and unconsolidated entities under development:
Investment in real estate, net$(3,812)$(2,592)
Investments in unconsolidated entities$(2,851)$(4,302)
Investments in unconsolidated entities – development/other:
Investments in unconsolidated entities$(60,550)$(28,133)
Other liabilities$(1,500)$(660)
Consolidation of previously unconsolidated entities:
Investment in real estate, net$(88,356)$—
Investments in unconsolidated entities$32,370$—
Other assets$56$—
Accounts payable and accrued expenses$1,725$—
Other liabilities$27$—
Security deposits$97$—
Debt financing costs:
Notes, net$(4,518)$—
Proceeds from (payments on) settlement of derivative instruments:
Other assets$89$—
Other liabilities$(3,639)$—

See accompanying notes

EQUITY RESIDENTIAL

CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(Amounts in thousands)

(Unaudited)

Six Months Ended June 30,
20252024
Right-of-use assets and lease liabilities initial measurement and reclassifications:
Right-of-use assets$(527)$—
Lease liabilities$527$—
Non-cash share distribution and other transfers from unconsolidated entities:
Investments in unconsolidated entities$676$—
Other assets$(676)$—
Non-cash change in Supplemental Executive Retirement Plan (SERP) balances:
Other assets$8,915$3,437
Other liabilities$(8,175)$(2,839)
Paid in capital$(740)$(598)

See accompanying notes

EQUITY RESIDENTIAL

CONSOLIDATED STATEMENT****S OF CHANGES IN EQUITY

(Amounts in thousands except per share data)

(Unaudited)

Six Months Ended June 30,Quarter Ended June 30,
2025202420252024
SHAREHOLDERS’ EQUITY
PREFERRED SHARES
Balance, beginning of period$17,155$37,280$17,155$17,155
Partial redemption of 8.29% Series K Cumulative Redeemable—(20,125)——
Balance, end of period$17,155$17,155$17,155$17,155
**COMMON SHARES, $**0.01 PAR VALUE
Balance, beginning of period$3,795$3,793$3,798$3,789
Conversion of OP Units into Common Shares2111
Exercise of share options111—
Employee Share Purchase Plan (ESPP)—1—1
Common Shares repurchased and retired—(7)——
Share-based employee compensation expense:
Restricted shares22——
Balance, end of period$3,800$3,791$3,800$3,791
PAID IN CAPITAL
Balance, beginning of period$9,611,826$9,601,866$9,622,470$9,603,743
Common Share Issuance:
Conversion of OP Units into Common Shares8,7715,0474,3654,793
Exercise of share options5,3566,4799962,079
Employee Share Purchase Plan (ESPP)1,4132,448471804
Share-based employee compensation expense:
Restricted shares9,3379,3814,9014,887
Share options2,6562,5071,3771,218
ESPP discount25850164205
Offering costs(481)—(481)—
Supplemental Executive Retirement Plan (SERP)(740)(598)(851)(371)
Change in market value of Redeemable Noncontrolling Interests – Operating Partnership19,568(39,058)18,813(30,243)
Adjustment for Noncontrolling Interests ownership in Operating Partnership(1,692)1,5324,1472,990
Balance, end of period$9,656,272$9,590,105$9,656,272$9,590,105
RETAINED EARNINGS
Balance, beginning of period$1,407,570$1,437,185$1,400,511$1,436,671
Net income attributable to controlling interests448,948473,270192,356177,483
Common Share distributions(526,428)(511,720)(263,133)(255,877)
Preferred Share distributions(711)(902)(355)(355)
Premium on redemption of Preferred Shares – cash charge—(1,444)——
Common Shares repurchased and retired—(38,467)——
Balance, end of period$1,329,379$1,357,922$1,329,379$1,357,922
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
Balance, beginning of period$4,214$5,704$3,396$6,314
Accumulated other comprehensive income (loss) – derivative instruments:
Unrealized holding gains (losses) arising during the period(3,550)—(2,046)—
Losses reclassified into earnings from other comprehensive income9511,210265600
Balance, end of period$1,615$6,914$1,615$6,914
DISTRIBUTIONS
Distributions declared per Common Share outstanding$1.385$1.35$0.6925$0.675

See accompanying notes

EQUITY RESIDENTIAL

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Continued)

(Amounts in thousands except per share data)

(Unaudited)

Six Months Ended June 30,Quarter Ended June 30,
2025202420252024
NONCONTROLLING INTERESTS
OPERATING PARTNERSHIP
Balance, beginning of period$201,942$202,306$207,090$207,272
Issuance of restricted units to Noncontrolling Interests42——
Conversion of OP Units held by Noncontrolling Interests into OP Units held by General Partner(8,773)(5,048)(4,366)(4,794)
Equity compensation associated with Noncontrolling Interests10,59310,2365,4926,149
Net income attributable to Noncontrolling Interests12,32813,2785,2265,003
Distributions to Noncontrolling Interests(16,159)(15,875)(7,559)(7,429)
Change in carrying value of Redeemable Noncontrolling Interests – Operating Partnership1,090665981821
Adjustment for Noncontrolling Interests ownership in Operating Partnership1,692(1,532)(4,147)(2,990)
Balance, end of period$202,717$204,032$202,717$204,032
PARTIALLY OWNED PROPERTIES
Balance, beginning of period$(718)$994$(2,989)$(1,131)
Net income attributable to Noncontrolling Interests2,3072,0391,2031,069
Contributions by Noncontrolling Interests—458—223
Distributions to Noncontrolling Interests(4,052)(2,786)(677)(456)
Other—(1,000)——
Balance, end of period$(2,463)$(295)$(2,463)$(295)

See accompanying notes

ERP OPERATING LI****MITED PARTNERSHIP

CONSOLIDATED B****ALANCE SHEETS

(Amounts in thousands)

(Unaudited)

June 30,December 31,
20252024
ASSETS
Land$5,636,458$5,606,531
Depreciable property24,711,74024,039,412
Projects under development168,626261,706
Land held for development59,95663,142
Investment in real estate30,576,78029,970,791
Accumulated depreciation(10,816,579)(10,412,463)
Investment in real estate, net19,760,20119,558,328
Investments in unconsolidated entities403,768386,531
Cash and cash equivalents31,27662,302
Restricted deposits100,67897,864
Right-of-use assets449,577455,445
Other assets282,014273,706
Total assets$21,027,514$20,834,176
LIABILITIES AND CAPITAL
Liabilities:
Mortgage notes payable, net$1,594,765$1,630,690
Notes, net5,994,9145,947,376
Line of credit and commercial paper782,147543,679
Accounts payable and accrued expenses108,79299,347
Accrued interest payable75,69474,176
Lease liabilities302,847304,897
Other liabilities290,101310,559
Security deposits81,17975,611
Distributions payable270,695263,494
Total liabilities9,501,1349,249,829
Commitments and contingencies
Redeemable Limited Partners317,905338,563
Capital:
Partners’ Capital:
Preference Units17,15517,155
General Partner10,989,45111,023,191
Limited Partners202,717201,942
Accumulated other comprehensive income (loss)1,6154,214
Total partners’ capital11,210,93811,246,502
Noncontrolling Interests – Partially Owned Properties(2,463)(718)
Total capital11,208,47511,245,784
Total liabilities and capital$21,027,514$20,834,176

See accompanying notes

ERP OPERATING LIMITED PARTNERSHIP

CONSOLIDATED STATEMENTS OF OPERA****TIONS AND COMPREHENSIVE INCOME

(Amounts in thousands except per Unit data)

(Unaudited)

Six Months Ended June 30,Quarter Ended June 30,
2025202420252024
REVENUES
Rental income$1,529,637$1,464,981$768,827$734,163
EXPENSES
Property and maintenance280,247261,128136,274126,498
Real estate taxes and insurance224,084214,498112,332105,571
Property management70,60268,96934,78633,511
General and administrative36,78634,35118,53118,631
Depreciation497,635450,093240,889224,398
Total expenses1,109,3541,029,039542,812508,609
Net gain (loss) on sales of real estate properties212,432227,99458,28039,809
Interest and other income3,82110,6572,1291,328
Other expenses(8,961)(45,123)(4,805)(13,385)
Interest:
Expense incurred, net(147,431)(133,040)(75,317)(65,828)
Amortization of deferred financing costs(4,247)(3,836)(2,103)(1,918)
Income before income and other taxes, income (loss) from investments in unconsolidated entities and net gain (loss) on sales of land parcels475,897492,594204,199185,560
Income and other tax (expense) benefit(829)(635)(407)(331)
Income (loss) from investments in unconsolidated entities(11,407)(3,372)(4,996)(1,674)
Net gain (loss) on sales of land parcels(78)—(11)—
Net income463,583488,587198,785183,555
Net (income) loss attributable to Noncontrolling Interests – Partially Owned Properties(2,307)(2,039)(1,203)(1,069)
Net income attributable to controlling interests$461,276$486,548$197,582$182,486
ALLOCATION OF NET INCOME:
Preference Units$711$902$355$355
Premium on redemption of Preference Units$—$1,444$—$—
General Partner$448,237$470,924$192,001$177,128
Limited Partners12,32813,2785,2265,003
Net income available to Units$460,565$484,202$197,227$182,131
Earnings per Unit – basic:
Net income available to Units$1.18$1.24$0.51$0.47
Weighted average Units outstanding389,779389,380389,837389,271
Earnings per Unit – diluted:
Net income available to Units$1.18$1.24$0.50$0.47
Weighted average Units outstanding391,345390,548391,498390,542

See accompanying notes

ERP OPERATING LIMITED PARTNERSHIP

CONSOLIDATED STATEMENTS OF OPERATIO****NS AND COMPREHENSIVE INCOME (Continued)

(Amounts in thousands except per Unit data)

(Unaudited)

Six Months Ended June 30,Quarter Ended June 30,
2025202420252024
Comprehensive income:
Net income$463,583$488,587$198,785$183,555
Other comprehensive income (loss):
Other comprehensive income (loss) – derivative instruments:
Unrealized holding gains (losses) arising during the period(3,550)—(2,046)—
Losses reclassified into earnings from other comprehensive income9511,210265600
Other comprehensive income (loss)(2,599)1,210(1,781)600
Comprehensive income460,984489,797197,004184,155
Comprehensive (income) attributable to Noncontrolling Interests – Partially Owned Properties(2,307)(2,039)(1,203)(1,069)
Comprehensive income attributable to controlling interests$458,677$487,758$195,801$183,086

See accompanying notes

ERP OPERATING LIMITED PARTNERSHIP

CONSOLIDATED STA****TEMENTS OF CASH FLOWS

(Amounts in thousands)

(Unaudited)

Six Months Ended June 30,
20252024
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income$463,583$488,587
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation497,635450,093
Amortization of deferred financing costs4,2473,836
Amortization of discounts and premiums on debt2,6372,536
Amortization of deferred settlements on derivative instruments9451,204
Amortization of right-of-use assets6,3956,470
Write-off of pursuit costs2,0481,369
(Income) loss from investments in unconsolidated entities11,4073,372
Distributions from unconsolidated entities – return on capital243281
Net (gain) loss on sales of real estate properties(212,432)(227,994)
Net (gain) loss on sales of land parcels78—
Realized (gain) loss on investment securities491,316
Unrealized (gain) loss on investment securities—(5,745)
Compensation paid with Company Common Shares21,56421,350
Changes in assets and liabilities:
(Increase) decrease in other assets(18,706)30,297
Increase (decrease) in accounts payable and accrued expenses10,90118,780
Increase (decrease) in accrued interest payable1,518(131)
Increase (decrease) in lease liabilities(1,106)(1,020)
Increase (decrease) in other liabilities(11,407)22,697
Increase (decrease) in security deposits5,471670
Net cash provided by operating activities785,070817,968
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in real estate – acquisitions(534,855)(63,507)
Investment in real estate – development/other(59,713)(55,253)
Capital expenditures to real estate(144,368)(153,304)
Non-real estate capital additions(1,019)(921)
Interest capitalized for real estate and unconsolidated entities under development(6,663)(6,894)
Proceeds from disposition of real estate, net343,064330,128
Investments in unconsolidated entities – acquisitions—(31,286)
Investments in unconsolidated entities – development/other(62,050)(28,793)
Distributions from unconsolidated entities – return of capital33116
Proceeds from sale of investment securities3597,457
Consolidation of previously unconsolidated entities(54,081)—
Net cash provided by (used for) investing activities(518,995)(2,357)

See accompanying notes

ERP OPERATING LIMITED PARTNERSHIP

CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(Amounts in thousands)

(Unaudited)

Six Months Ended June 30,
20252024
CASH FLOWS FROM FINANCING ACTIVITIES:
Debt financing costs$(4,518)$—
Mortgage notes payable, net:
Lump sum payoffs(37,940)—
Notes, net:
Proceeds498,580—
Lump sum payoffs(450,000)—
Line of credit and commercial paper:
Commercial paper proceeds18,803,9633,532,753
Commercial paper repayments(18,565,495)(3,771,000)
Proceeds from (payments on) settlement of derivative instruments(3,550)—
Finance ground lease principal payments(1,471)(1,438)
Proceeds from EQR’s Employee Share Purchase Plan (ESPP)1,4132,449
Proceeds from exercise of EQR options5,3576,480
OP Units repurchased and retired—(38,474)
Redemption of Preference Units—(20,125)
Premium on redemption of Preference Units—(1,444)
Payment of offering costs(481)—
Other financing activities, net(53)(45)
Contributions – Noncontrolling Interests – Partially Owned Properties—458
Contributions – Limited Partners42
Distributions:
OP Units – General Partner(519,437)(507,111)
Preference Units(711)(1,320)
OP Units – Limited Partners(15,949)(15,629)
Noncontrolling Interests – Partially Owned Properties(3,999)(2,741)
Net cash provided by (used for) financing activities(294,287)(817,185)
Net increase (decrease) in cash and cash equivalents and restricted deposits(28,212)(1,574)
Cash and cash equivalents and restricted deposits, beginning of period160,166139,995
Cash and cash equivalents and restricted deposits, end of period$131,954$138,421
Cash and cash equivalents and restricted deposits, end of period
Cash and cash equivalents$31,276$38,298
Restricted deposits100,678100,123
Total cash and cash equivalents and restricted deposits, end of period$131,954$138,421

See accompanying notes

ERP OPERATING LIMITED PARTNERSHIP

CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(Amounts in thousands)

(Unaudited)

Six Months Ended June 30,
20252024
SUPPLEMENTAL INFORMATION:
Cash paid for interest, net of amounts capitalized$133,733$120,955
Net cash paid (received) for income and other taxes$920$877
Amortization of deferred financing costs:
Other assets$1,393$1,392
Mortgage notes payable, net$611$524
Notes, net$2,243$1,920
Amortization of discounts and premiums on debt:
Mortgage notes payable, net$1,404$1,412
Notes, net$1,233$1,124
Amortization of deferred settlements on derivative instruments:
Other liabilities$(6)$(6)
Accumulated other comprehensive income$951$1,210
Write-off of pursuit costs:
Investment in real estate, net$187$319
Investments in unconsolidated entities$1,740$866
Other assets$121$184
(Income) loss from investments in unconsolidated entities:
Investments in unconsolidated entities$10,804$2,736
Other liabilities$603$636
Realized/unrealized (gain) loss on derivative instruments:
Other assets$(89)$—
Other liabilities$3,639$—
Accumulated other comprehensive income$(3,550)$—
Interest capitalized for real estate and unconsolidated entities under development:
Investment in real estate, net$(3,812)$(2,592)
Investments in unconsolidated entities$(2,851)$(4,302)
Investments in unconsolidated entities – development/other:
Investments in unconsolidated entities$(60,550)$(28,133)
Other liabilities$(1,500)$(660)
Consolidation of previously unconsolidated entities:
Investment in real estate, net$(88,356)$—
Investments in unconsolidated entities$32,370$—
Other assets$56$—
Accounts payable and accrued expenses$1,725$—
Other liabilities$27$—
Security deposits$97$—
Debt financing costs:
Notes, net$(4,518)$—
Proceeds from (payments on) settlement of derivative instruments:
Other assets$89$—
Other liabilities$(3,639)$—

See accompanying notes

ERP OPERATING LIMITED PARTNERSHIP

CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(Amounts in thousands)

(Unaudited)

Six Months Ended June 30,
20252024
Right-of-use assets and lease liabilities initial measurement and reclassifications:
Right-of-use assets$(527)$—
Lease liabilities$527$—
Non-cash share distribution and other transfers from unconsolidated entities:
Investments in unconsolidated entities$676$—
Other assets$(676)$—
Non-cash change in Supplemental Executive Retirement Plan (SERP) balances:
Other assets$8,915$3,437
Other liabilities$(8,175)$(2,839)
Paid in capital$(740)$(598)

See accompanying notes

ERP OPERATING LIMITED PARTNERSHIP

CONSOLIDATED STATEMENT****S OF CHANGES IN CAPITAL

(Amounts in thousands except per Unit data)

(Unaudited)

Six Months Ended June 30,Quarter Ended June 30,
2025202420252024
PARTNERS’ CAPITAL
PREFERENCE UNITS
Balance, beginning of period$17,155$37,280$17,155$17,155
Partial redemption of 8.29% Series K Cumulative Redeemable—(20,125)——
Balance, end of period$17,155$17,155$17,155$17,155
GENERAL PARTNER
Balance, beginning of period$11,023,191$11,042,844$11,026,779$11,044,203
OP Unit Issuance:
Conversion of OP Units held by Limited Partners into OP Units held by General Partner8,7735,0484,3664,794
Exercise of EQR share options5,3576,4809972,079
EQR’s Employee Share Purchase Plan (ESPP)1,4132,449471805
Share-based employee compensation expense:
EQR restricted shares9,3399,3834,9014,887
EQR share options2,6562,5071,3771,218
EQR ESPP discount25850164205
OP Units repurchased and retired—(38,474)——
Net income available to Units – General Partner448,237470,924192,001177,128
OP Units – General Partner distributions(526,428)(511,720)(263,133)(255,877)
Offering costs(481)—(481)—
Supplemental Executive Retirement Plan (SERP)(740)(598)(851)(371)
Change in market value of Redeemable Limited Partners19,568(39,058)18,813(30,243)
Adjustment for Limited Partners ownership in Operating Partnership(1,692)1,5324,1472,990
Balance, end of period$10,989,451$10,951,818$10,989,451$10,951,818
LIMITED PARTNERS
Balance, beginning of period$201,942$202,306$207,090$207,272
Issuance of restricted units to Limited Partners42——
Conversion of OP Units held by Limited Partners into OP Units held by General Partner(8,773)(5,048)(4,366)(4,794)
Equity compensation associated with Units – Limited Partners10,59310,2365,4926,149
Net income available to Units – Limited Partners12,32813,2785,2265,003
Units – Limited Partners distributions(16,159)(15,875)(7,559)(7,429)
Change in carrying value of Redeemable Limited Partners1,090665981821
Adjustment for Limited Partners ownership in Operating Partnership1,692(1,532)(4,147)(2,990)
Balance, end of period$202,717$204,032$202,717$204,032
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
Balance, beginning of period$4,214$5,704$3,396$6,314
Accumulated other comprehensive income (loss) – derivative instruments:
Unrealized holding gains (losses) arising during the period(3,550)—(2,046)—
Losses reclassified into earnings from other comprehensive income9511,210265600
Balance, end of period$1,615$6,914$1,615$6,914
DISTRIBUTIONS
Distributions declared per Unit outstanding$1.385$1.35$0.6925$0.675

See accompanying notes

ERP OPERATING LIMITED PARTNERSHIP

CONSOLIDATED STATEMENTS OF CHANGES IN CAPITAL (Continued)

(Amounts in thousands except per Unit data)

(Unaudited)

Six Months Ended June 30,Quarter Ended June 30,
2025202420252024
NONCONTROLLING INTERESTS
NONCONTROLLING INTERESTS – PARTIALLY OWNED PROPERTIES
Balance, beginning of period$(718)$994$(2,989)$(1,131)
Net income attributable to Noncontrolling Interests2,3072,0391,2031,069
Contributions by Noncontrolling Interests—458—223
Distributions to Noncontrolling Interests(4,052)(2,786)(677)(456)
Other—(1,000)——
Balance, end of period$(2,463)$(295)$(2,463)$(295)

See accompanying notes

EQUITY RESIDENTIAL

ERP OPERATING LIMITED PARTNERSHIP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1.

Business

Equity Residential (“EQR”) is an S&P 500 company focused on the acquisition, development and management of residential properties located in and around dynamic cities that attract affluent long-term renters, a business that is conducted on its behalf by ERP Operating Limited Partnership (“ERPOP”). EQR is a Maryland real estate investment trust (“REIT”) formed in March 1993 and ERPOP is an Illinois limited partnership formed in May 1993. References to the “Company,” “we,” “us” or “our” mean collectively EQR, ERPOP and those entities/subsidiaries owned or controlled by EQR and/or ERPOP. References to the “Operating Partnership” mean collectively ERPOP and those entities/subsidiaries owned or controlled by ERPOP. Unless otherwise indicated, the notes to consolidated financial statements apply to both the Company and the Operating Partnership.

EQR is the general partner of, and as of June 30, 2025 owned an approximate 97.0% ownership interest in, ERPOP. All of the Company’s property ownership, development and related business operations are conducted through the Operating Partnership and EQR has no material assets or liabilities other than its investment in ERPOP. EQR issues equity from time to time, the net proceeds of which it is obligated to contribute to ERPOP, but does not have any indebtedness as all debt is incurred by the Operating Partnership. The Operating Partnership holds substantially all of the assets of the Company, including the Company’s ownership interests in its joint ventures. The Operating Partnership conducts the operations of the business and is structured as a partnership with no publicly traded equity.

As of June 30, 2025, the Company, directly or indirectly through investments in title holding entities, owned all or a portion of 319 properties located in 10 states and the District of Columbia consisting of 86,422 apartment units. The ownership breakdown includes (table does not include any uncompleted development properties):

PropertiesApartment Units
Wholly Owned Properties30282,054
Partially Owned Properties – Consolidated122,656
Partially Owned Properties – Unconsolidated51,712
31986,422

2.

Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States (“GAAP”) for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) and certain reclassifications considered necessary for a fair presentation have been included. Operating results for the six months ended June 30, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025.

In preparation of the Company’s financial statements in conformity with accounting principles generally accepted in the United States, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

The balance sheets at December 31, 2024 have been derived from the audited financial statements at that date but do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements.

For further information, including definitions of capitalized terms not defined herein, refer to the consolidated financial statements and footnotes thereto included in the Company’s and the Operating Partnership’s Annual Report on Form 10-K for the year ended December 31, 2024.

Income and Other Taxes

EQR has elected to be taxed as a REIT. This, along with the nature of the operations of its operating properties, resulted in no provision for federal income taxes at the EQR level. In addition, ERPOP generally is not liable for federal income taxes as the partners recognize their allocable share of income or loss in their tax returns; therefore no provision for federal income taxes has been made at the ERPOP level. Historically, the Company has generally only incurred certain state and local income, excise and franchise taxes. The Company has elected taxable REIT subsidiary (“TRS”) status for certain of its corporate subsidiaries and, as a result, these entities will incur both federal and state income taxes on any taxable income of such entities after consideration of any net operating losses.

Recent Accounting Pronouncements

In November 2024, the Financial Accounting Standards Board (“FASB”) issued a new standard on disaggregation of income statement expenses, which requires an entity to disclose, on an annual and interim basis, disaggregated information about certain income statement expense line items in a tabular format in the notes to the financial statements. The standard will be effective for annual reporting periods beginning after December 15, 2026 and for interim reporting periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted, and may be applied either prospectively or retrospectively. The Company is currently evaluating the impact of the new rules on its disclosures.

In March 2024, the Securities and Exchange Commission ("SEC") adopted final rules that will require certain climate-related information in registration statements and annual reports. In April 2024, the SEC voluntarily stayed the new rules as a result of pending legal challenges. In March 2025, the SEC voted to end its defense of the rules. The new rules include a requirement to disclose material climate-related risks, descriptions of board and management oversight and risk management activities, the material impacts of these risks on a registrant’s strategy, business model and outlook, and any material climate-related targets or goals, as well as material effects and costs of severe weather events and other natural conditions and greenhouse gas emissions. Prior to the stay of the new rules, they would have been effective for annual periods beginning January 1, 2025, except for the greenhouse gas emissions disclosures, which would have been effective for annual periods beginning January 1, 2026. The Company is currently monitoring the legal challenges and evaluating the potential impact of the new rules on its disclosures.

In December 2023, the FASB issued an amendment to the income tax standards which requires disclosure enhancements and further transparency to certain income tax disclosures, most notably the tax rate reconciliation and income taxes paid. The new standard will be effective for annual periods beginning January 1, 2025 and will be applied on a prospective basis with the option to apply the standard retrospectively. Due to the nature of the Company's operations and the immaterial amount of income taxes incurred/paid due to its status as a REIT, we expect the adoption of the standard to have no impact on its disclosures. See the Income and Other Taxes section above for additional discussion.

In November 2023, the FASB issued an amendment to the segment reporting standards which requires disclosure for each reportable segment, on an interim and annual basis, of the significant expense categories and amounts that are regularly provided to the chief operating decision maker and included in each reported measure of a segment’s profit or loss. Additionally, it requires disclosure of the title and position of the individual or the name of the group or committee identified as the chief operating decision maker. The Company adopted the standard when effective for annual periods beginning January 1, 2024 and interim periods beginning January 1, 2025 on a retrospective basis. See Note 12 for further discussion.

In March 2020, the FASB issued an amendment to the reference rate reform standard which provides the option for a limited period of time to ease the potential burden in accounting for, or recognizing the effects of, reference rate reform on contract modifications and hedge accounting. The new standard was effective for the Company upon issuance and elections could be made through December 31, 2024. The Company elected to apply the hedge accounting expedients and application of these expedients preserves the presentation of derivatives consistent with past presentation.

3.

Equity, Capital and Other Interests

The Company refers to “Common Shares” and “Units” (which refer to both OP Units and restricted units) as equity securities for EQR and “General Partner Units” and “Limited Partner Units” as equity securities for ERPOP. To provide a streamlined and more readable presentation of the disclosures for the Company and the Operating Partnership, several sections below refer to the respective terminology for each with the same financial information and separate sections are provided, where needed, to further distinguish any differences in financial information and terminology.

The following table presents the changes in the Company’s issued and outstanding Common Shares and Units for the six months ended June 30, 2025 and 2024:

20252024
Common Shares
Common Shares outstanding at January 1,379,475,383379,291,417
Common Shares Issued:
Conversion of OP Units224,39990,131
Exercise of share options83,754119,516
Employee Share Purchase Plan (ESPP)23,09047,466
Restricted share grants, net173,814190,804
Common Shares Other:
Repurchased and retired—(652,452)
Common Shares outstanding at June 30,379,980,440379,086,882
Units
Units outstanding at January 1,11,543,77311,581,306
Restricted unit grants, net286,898172,667
Conversion of OP Units to Common Shares(224,399)(90,131)
Units outstanding at June 30,11,606,27211,663,842
Total Common Shares and Units outstanding at June 30,391,586,712390,750,724
Units Ownership Interest in Operating Partnership3.0%3.0%

The following table presents the changes in the Operating Partnership’s issued and outstanding General Partner Units and Limited Partner Units for the six months ended June 30, 2025 and 2024:

20252024
General and Limited Partner Units
General and Limited Partner Units outstanding at January 1,391,019,156390,872,723
Issued to General Partner:
Exercise of EQR share options83,754119,516
EQR’s Employee Share Purchase Plan (ESPP)23,09047,466
EQR’s restricted share grants, net173,814190,804
Issued to Limited Partners:
Restricted unit grants, net286,898172,667
General Partner Other:
OP Units repurchased and retired—(652,452)
General and Limited Partner Units outstanding at June 30,391,586,712390,750,724
Limited Partner Units
Limited Partner Units outstanding at January 1,11,543,77311,581,306
Limited Partner restricted unit grants, net286,898172,667
Conversion of Limited Partner OP Units to EQR Common Shares(224,399)(90,131)
Limited Partner Units outstanding at June 30,11,606,27211,663,842
Limited Partner Units Ownership Interest in Operating Partnership3.0%3.0%

The equity positions of various individuals and entities that contributed their properties to the Operating Partnership in exchange for OP Units, as well as the equity positions of the holders of restricted units, are collectively referred to as the “Noncontrolling Interests – Operating Partnership” and “Limited Partners Capital,” respectively, for the Company and the Operating Partnership. Subject to certain exceptions (including the “book-up” requirements of restricted units), the Noncontrolling Interests – Operating Partnership/Limited Partners Capital may exchange their Units with EQR for Common Shares on a one-for-one basis. The carrying value of the Noncontrolling Interests – Operating Partnership/Limited Partners Capital (including redeemable interests) is allocated

based on the number of Noncontrolling Interests – Operating Partnership/Limited Partners Capital in total in proportion to the number of Noncontrolling Interests – Operating Partnership/Limited Partners Capital in total plus the total number of Common Shares/General Partner Units. Net income is allocated to the Noncontrolling Interests – Operating Partnership/Limited Partners Capital based on the weighted average ownership percentage during the period.

The Operating Partnership has the right but not the obligation to make a cash payment instead of issuing Common Shares to any and all holders of Noncontrolling Interests – Operating Partnership/Limited Partners Capital requesting an exchange of their Noncontrolling Interests – Operating Partnership/Limited Partners Capital with EQR. Once the Operating Partnership elects not to redeem the Noncontrolling Interests – Operating Partnership/Limited Partners Capital for cash, EQR is obligated to deliver Common Shares to the exchanging holder of the Noncontrolling Interests – Operating Partnership/Limited Partners Capital.

The Noncontrolling Interests – Operating Partnership/Limited Partners Capital are classified as either mezzanine equity or permanent equity. If EQR is required, either by contract or securities law, to deliver registered Common Shares, such Noncontrolling Interests – Operating Partnership/Limited Partners Capital are differentiated and referred to as “Redeemable Noncontrolling Interests – Operating Partnership” and “Redeemable Limited Partners,” respectively. Instruments that require settlement in registered shares cannot be classified in permanent equity as it is not always completely within an issuer’s control to deliver registered shares. Therefore, settlement in cash is assumed and that responsibility for settlement in cash is deemed to fall to the Operating Partnership as the primary source of cash for EQR, resulting in presentation in the mezzanine section of the balance sheet. The Redeemable Noncontrolling Interests – Operating Partnership/Redeemable Limited Partners are adjusted to the greater of carrying value or fair market value based on the Common Share price of EQR at the end of each respective reporting period. EQR has the ability to deliver unregistered Common Shares for the remaining portion of the Noncontrolling Interests – Operating Partnership/Limited Partners Capital that are classified in permanent equity at June 30, 2025 and December 31, 2024.

The carrying value of the Redeemable Noncontrolling Interests – Operating Partnership/Redeemable Limited Partners is allocated based on the number of Redeemable Noncontrolling Interests – Operating Partnership/Redeemable Limited Partners in proportion to the number of Noncontrolling Interests – Operating Partnership/Limited Partners Capital in total. Such percentage of the total carrying value of Units/Limited Partner Units which is ascribed to the Redeemable Noncontrolling Interests – Operating Partnership/Redeemable Limited Partners is then adjusted to the greater of carrying value or fair market value as described above. As of June 30, 2025 and 2024, the Redeemable Noncontrolling Interests – Operating Partnership/Redeemable Limited Partners have a redemption value of approximately $317.9 million and $327.6 million, respectively, which represents the value of Common Shares that would be issued in exchange for the Redeemable Noncontrolling Interests – Operating Partnership/Redeemable Limited Partners.

The following table presents the changes in the redemption value of the Redeemable Noncontrolling Interests – Operating Partnership/Redeemable Limited Partners for the six months ended June 30, 2025 and 2024, respectively (amounts in thousands):

20252024
Balance at January 1,$338,563$289,248
Change in market value(19,568)39,058
Change in carrying value(1,090)(665)
Balance at June 30,$317,905$327,641

Net proceeds from EQR Common Share and Preferred Share (see definition below) offerings and proceeds from exercise of options for Common Shares are contributed by EQR to ERPOP. In return for those contributions, EQR receives a number of OP Units in ERPOP equal to the number of Common Shares it has issued in the equity offering (or in the case of a preferred equity offering, a number of preference units in ERPOP equal in number and having the same terms as the Preferred Shares issued in the equity offering). As a result, the net proceeds from Common Shares and Preferred Shares are allocated for the Company between shareholders’ equity and Noncontrolling Interests – Operating Partnership and for the Operating Partnership between General Partner’s Capital and Limited Partners Capital to account for the change in their respective percentage ownership of the underlying equity.

The Company’s declaration of trust authorizes it to issue up to 100,000,000 preferred shares of beneficial interest, $0.01 par value per share (the “Preferred Shares”), with specific rights, preferences and other attributes as the Board of Trustees may determine, which may include preferences, powers and rights that are senior to the rights of holders of the Company’s Common Shares.

The following table presents the Company’s issued and outstanding Preferred Shares/Preference Units as of June 30, 2025 and December 31, 2024:

Amounts in thousands
Annual
CallDividend PerJune 30,December 31,
Date (1)Share/Unit (2)20252024
Preferred Shares/Preference Units of beneficial interest, $0.01 par value;100,000,000 shares authorized:
8.29% Series K Cumulative Redeemable Preferred Shares/Preference Units; liquidation value $50 per share/unit; 343,100 shares/units issued and outstanding as of June 30, 2025 and December 31, 202412/10/2026$4.145$17,155$17,155
$17,155$17,155

(1)

On or after the call date, redeemable Preferred Shares/Preference Units may be redeemed for cash at the option of the Company or the Operating Partnership, respectively, in whole or in part, at a redemption price equal to the liquidation price per share/unit, plus accrued and unpaid distributions, if any.

(2)

Dividends on Preferred Shares/Preference Units are payable quarterly.

Other

EQR and ERPOP currently have an active universal shelf registration statement for the issuance of equity and debt securities that automatically became effective upon filing with the SEC in May 2025 and expires in May 2028. Per the terms of ERPOP’s partnership agreement, EQR contributes the net proceeds of all equity offerings to the capital of ERPOP in exchange for additional OP Units (on a one-for-one Common Share per OP Unit basis) or preference units (on a one-for-one preferred share per preference unit basis).

The Company has an At-The-Market (“ATM”) share offering program which allows EQR to issue Common Shares from time to time into the existing trading market at current market prices or through negotiated transactions, including under forward sale arrangements. In May 2025, the Company replaced the prior program (which had expired) with a new program that matures in May 2028 and gives us the authority to issue up to 13.0 million shares, all of which remain available for issuance as of June 30, 2025.

The Company may repurchase up to 13.0 million Common Shares under its share repurchase program, which was reauthorized during the first quarter of 2025. As no Common Shares have been repurchased since the reauthorization, all 13.0 million shares remain available to repurchase as of June 30, 2025.

4.

Real Estate

The following table summarizes the carrying amounts for the Company’s investment in real estate (at cost) as of June 30, 2025 and December 31, 2024 (amounts in thousands):

June 30, 2025December 31, 2024
Land$5,636,458$5,606,531
Depreciable property:
Buildings and improvements21,180,21020,635,583
Furniture, fixtures and equipment2,949,0712,840,691
In-Place lease intangibles582,459563,138
Projects under development:
Land36,77940,034
Construction-in-progress131,847221,672
Land held for development:
Land42,53846,160
Construction-in-progress17,41816,982
Investment in real estate30,576,78029,970,791
Accumulated depreciation(10,816,579)(10,412,463)
Investment in real estate, net$19,760,201$19,558,328

During the six months ended June 30, 2025, the Company acquired the following from unaffiliated parties (purchase price and purchase price allocation in thousands):

Purchase Price Allocation (1)
PropertiesApartment UnitsPurchase PriceLandDepreciable Property
Rental Properties – Consolidated82,064$533,843$67,972$466,883

(1)

Purchase price allocation includes capitalized closing costs.

During the six months ended June 30, 2025, the Company also acquired its joint venture partner's 10% interest in a previously unconsolidated 270-unit apartment property, and the property is now wholly owned. The Company recorded real estate basis of $88.4 million upon consolidation, allocated as $8.5 million to land and $79.9 million to depreciable property. See Note 5 for further discussion.

During the six months ended June 30, 2025, the Company disposed of the following to unaffiliated parties (sales price and net gain (loss) in thousands):

PropertiesApartment UnitsSales PriceNet Gain (Loss)
Rental Properties – Consolidated3835$346,600$212,432
Land Parcel (one) – Consolidated——4,300(78)
Total3835$350,900$212,354

5.

Investments in Partially Owned Entities

The Company has invested in various entities with unrelated third parties which are either consolidated or accounted for under the equity method of accounting (unconsolidated).

Consolidated Variable Interest Entities (“VIEs”)

In accordance with accounting standards for consolidation of VIEs, the Company consolidates ERPOP on EQR’s financial statements. As the sole general partner of ERPOP, EQR has exclusive control of ERPOP’s day-to-day management. The limited partners are not able to exercise substantive kick-out or participating rights. As a result, ERPOP qualifies as a VIE. EQR has a controlling financial interest in ERPOP and, thus, is ERPOP’s primary beneficiary. EQR has the power to direct the activities of ERPOP that most significantly impact ERPOP’s economic performance as well as the obligation to absorb losses or the right to receive benefits from ERPOP that could potentially be significant to ERPOP.

The Company has various equity interests in certain joint ventures that have been deemed to be VIEs, and the Company is the VIEs’ primary beneficiary. As a result, the joint ventures are required to be consolidated on the Company’s financial statements. The following table summarizes the Company’s consolidated joint ventures as of June 30, 2025:

Operating PropertiesProjects Under Development (1)
PropertiesApartment UnitsProjectsApartment Units (2)
Consolidated Joint Ventures (VIE)122,6561440

(1)

Represents separate consolidated joint ventures for the purpose of developing multifamily rental properties.

(2)

Represents the intended number of apartment units to be developed.

The following table provides consolidated assets and liabilities related to the Company's VIEs as of June 30, 2025 and December 31, 2024 (amounts in thousands):

June 30, 2025December 31, 2024
Consolidated Assets$559,732$528,076
Consolidated Liabilities$48,799$47,137

Investments in Unconsolidated Entities

The Company has various equity interests in certain joint ventures that are unconsolidated and accounted for using the equity method of accounting. Most of these have been deemed to be VIEs and the Company is not the VIEs' primary beneficiary. The remaining have been deemed not to be VIEs and the Company does not have a controlling voting interest.

The following table and information summarizes the Company’s investments in unconsolidated entities as of June 30, 2025 and December 31, 2024 (amounts in thousands except for ownership percentage):

June 30, 2025December 31, 2024Ownership Percentage
Investments in Unconsolidated Entities:
Various Real Estate Holdings (VIE)$34,615$34,510Varies
Development and Lease-Up Projects and Land Held for Development (VIE)338,984323,99862% - 95% (1)
Real Estate Technology Funds/Companies (VIE)30,42928,276Varies
Other(260)(253)Varies
Investments in Unconsolidated Entities$403,768$386,531

(1)

In certain instances, the joint venture agreements contain provisions for promoted interests in favor of our joint venture partner. If the terms of the promoted interest are attained, then our share of the proceeds from a sale or other capital event of the unconsolidated entity may be less than the indicated ownership percentage.

The following table summarizes the Company’s unconsolidated joint ventures that were deemed to be VIEs as of June 30, 2025:

Development Lease-Up Projects (1)Real Estate Holdings (2)Projects Under Development (3)Projects Held for Development (4)
PropertiesApartment UnitsEntitiesProjectsApartment Units (5)ProjectsApartment Units (5)
Unconsolidated Joint Ventures (VIE)51,712326392526

(1)

The land parcel under one of these properties is subject to a long-term ground lease.

(2)

Represents entities that hold various real estate investments.

(3)

Represents separate unconsolidated joint ventures for the purpose of developing multifamily rental properties.

(4)

Represents separate unconsolidated joint ventures for the purpose of developing multifamily rental properties that have not yet started.

(5)

Represents the intended number of apartment units to be developed.

During the six months ended June 30, 2025, the Company acquired its joint venture partner's 10% interest in a previously unconsolidated 270-unit apartment property for approximately $3.6 million in cash (net of cash acquired) and also contributed $50.5 million for the joint venture to repay the third-party construction loan encumbering the property. The property is now wholly owned.

6.

Restricted Deposits

The following table presents the Company’s restricted deposits as of June 30, 2025 and December 31, 2024 (amounts in thousands):

June 30, 2025December 31, 2024
Mortgage escrow deposits:
Real estate taxes and insurance$621$217
Mortgage principal reserves/sinking funds35,66031,208
Mortgage escrow deposits36,28131,425
Restricted cash:
Restricted deposits on real estate investments2,1772,143
Resident security and utility deposits47,93844,287
Replacement reserves11,90917,914
Other2,3732,095
Restricted cash64,39766,439
Restricted deposits$100,678$97,864

7.

Leases

Lessor Accounting

The Company is the lessor for its residential and non-residential leases and these leases are accounted for as operating leases under the lease standard.

The following table presents the lease income types relating to lease payments for residential and non-residential leases along with the total other rental income for the six months ended June 30, 2025 and 2024 (amounts in thousands):

June 30, 2025June 30, 2024
Income TypeResidentialNon-ResidentialTotalResidentialNon-ResidentialTotal
Residential and non-residential rent$1,367,197$32,253$1,399,450$1,313,208$33,710$1,346,918
Utility recoveries (RUBS income) (1)51,03339951,43245,45643545,891
Parking rent23,83280824,64023,03563323,668
Other lease revenue, net (2)3,265(644)2,621(3,035)(463)(3,498)
Total lease revenue1,445,32732,8161,478,1431,378,66434,3151,412,979
Parking revenue83220,71921,55182120,89421,715
Other revenue29,48945429,94329,54973830,287
Total other rental income (3)30,32121,17351,49430,37021,63252,002
Rental income$1,475,648$53,989$1,529,637$1,409,034$55,947$1,464,981

(1)

RUBS income primarily consists of variable payments representing the recovery of utility costs from residents.

(2)

Other lease revenue consists of the revenue adjustment related to bad debt (see below for further discussion), service fees, late fees and other miscellaneous lease revenue.

(3)

Other rental income is accounted for under the revenue recognition standard and primarily consists of third-party transient parking revenue and ancillary income such as cable and laundry revenue.

The following table presents the lease income types relating to lease payments for residential and non-residential leases along with the total other rental income for the quarters ended June 30, 2025 and 2024 (amounts in thousands):

June 30, 2025June 30, 2024
Income TypeResidentialNon-ResidentialTotalResidentialNon-ResidentialTotal
Residential and non-residential rent$686,936$15,405$702,341$658,665$14,887$673,552
Utility recoveries (RUBS income) (1)25,71721725,93422,78720822,995
Parking rent11,96940812,37711,61141312,024
Other lease revenue, net (2)2,274(268)2,006(1,127)(387)(1,514)
Total lease revenue726,89615,762742,658691,93615,121707,057
Parking revenue39710,48010,87748010,55711,037
Other revenue15,08420815,29215,36470516,069
Total other rental income (3)15,48110,68826,16915,84411,26227,106
Rental income$742,377$26,450$768,827$707,780$26,383$734,163

(1)

RUBS income primarily consists of variable payments representing the recovery of utility costs from residents.

(2)

Other lease revenue consists of the revenue adjustment related to bad debt (see below for further discussion), service fees, late fees and other miscellaneous lease revenue.

(3)

Other rental income is accounted for under the revenue recognition standard and primarily consists of third-party transient parking revenue and ancillary income such as cable and laundry revenue.

The following table presents residential accounts receivable and straight-line receivable balances for the Company’s properties as of June 30, 2025 and December 31, 2024 (amounts in thousands):

Balance Sheet (Other assets):June 30, 2025December 31, 2024
Residential accounts receivable balances$13,904$15,152
Allowance for doubtful accounts(8,310)(9,904)
Net receivable balances$5,594$5,248
Straight-line receivable balances$11,828$10,234

The following table presents residential bad debt for the Company’s properties for the six months and quarters ended June 30, 2025 and 2024 (amounts in thousands):

Six Months Ended June 30,Quarter Ended June 30,
Income Statement (Rental income):2025202420252024
Bad debt, net$14,990$17,139$7,293$7,924
% of residential rental income1.0%1.2%1.0%1.1%

8.

Debt

EQR does not have any indebtedness as all debt is incurred by the Operating Partnership. Weighted average interest rates noted below for the six months ended June 30, 2025 include the effect of any derivative instruments and amortization of premiums/discounts/OCI (other comprehensive income) on debt and derivatives.

Mortgage Notes Payable

The following table summarizes the Company’s mortgage notes payable activity for the six months ended June 30, 2025 (amounts in thousands):

Mortgage notes payable, net as of December 31, 2024ProceedsLump sum payoffsScheduled principal repaymentsAmortization of premiums/ discountsAmortization of deferred financing costs, net (1)Mortgage notes payable, net as of June 30, 2025
Fixed Rate Debt:
Secured – Conventional$1,401,099$—$—$—$788$541$1,402,428
Floating Rate Debt:
Secured – Tax Exempt229,591—(37,940)—61670192,337
Total$1,630,690$—$(37,940)$—$1,404$611$1,594,765

(1)

Represents amortization of deferred financing costs, net of debt financing costs.

The following table summarizes certain interest rate and maturity date information as of and for the six months ended June 30, 2025:

June 30, 2025
Interest Rate Ranges (ending)0.10% - 5.25%
Weighted Average Interest Rate3.77%
Maturity Date Ranges2029-2061

As of June 30, 2025, the Company had $202.7 million of secured tax-exempt bonds subject to third-party credit enhancement.

Notes

The following table summarizes the Company’s notes activity for the six months ended June 30, 2025 (amounts in thousands):

Notes, net as of December 31, 2024ProceedsLump sum payoffsAmortization of premiums/ discountsAmortization of deferred financing costs, net (1)Notes, net as of June 30, 2025
Fixed Rate Debt:
Unsecured – Public$5,947,376$498,580(2)$(450,000)$1,233$(2,275)$5,994,914

(1)

Represents amortization of deferred financing costs, net of debt financing costs.

(2)

Issued $500.0 million of seven-year 4.95% unsecured notes, receiving net proceeds before underwriting fees, hedge termination costs and other expenses.

The following table summarizes certain interest rate and maturity date information as of and for the six months ended June 30, 2025:

June 30, 2025
Interest Rate Ranges (ending)1.85% - 7.57%
Weighted Average Interest Rate3.68%
Maturity Date Ranges2026-2047

The Company’s unsecured public notes contain certain financial and operating covenants including, among other things, maintenance of certain financial ratios. The Company was in compliance with its unsecured public debt covenants for the six months ended June 30, 2025.

Line of Credit and Commercial Paper

The Company has a $2.5 billion unsecured revolving credit facility maturing on October 26, 2027. The Company has the ability to increase available borrowings by an additional $750.0 million by adding lenders to the facility, obtaining the agreement of existing lenders to increase their commitments or incurring one or more term loans. The interest rate on advances under the facility will generally be the Secured Overnight Financing Rate ("SOFR") plus a spread (currently 0.725%), or based on bids received from the lending group, and the Company pays an annual facility fee (currently 0.125%). Both the spread and the facility fee are dependent on the Company’s senior unsecured credit rating and other terms and conditions per the agreement. The Company did not borrow any amounts under its revolving credit facility during the six months ended June 30, 2025.

The Company has an unsecured commercial paper note program under which it may borrow up to a maximum of $1.5 billion subject to market conditions. The notes will be sold under customary terms in the United States commercial paper note market and will rank pari passu with all of the Company’s other unsecured senior indebtedness.

The following table summarizes certain weighted average interest rate, maturity and amount outstanding information for the commercial paper program as of and for the six months ended June 30, 2025:

June 30, 2025
Weighted Average Interest Rate (1)4.60%
Weighted Average Maturity (in days)29
Weighted Average Amount Outstanding$372.1 million

(1)

The notes bear interest at various floating rates.

The Company limits its utilization of the revolving credit facility in order to maintain liquidity to support its $1.5 billion commercial paper program along with certain other obligations. The following table presents the availability on the Company’s unsecured revolving credit facility as of June 30, 2025 (amounts in thousands):

June 30, 2025
Unsecured revolving credit facility commitment$2,500,000
Commercial paper balance outstanding(785,000)
Unsecured revolving credit facility balance outstanding—
Other restricted amounts(3,448)
Unsecured revolving credit facility availability$1,711,552

9.

Fair Value Measurements

The valuation of financial instruments requires the Company to make estimates and judgments that affect the fair value of the instruments. The Company, where possible, bases the fair values of its financial instruments on listed market prices and third-party quotes. Where these are not available, the Company bases its estimates on current instruments with similar terms and maturities or on other factors relevant to the financial instruments.

In the normal course of business, the Company is exposed to the effect of interest rate changes. The Company may seek to manage these risks by following established risk management policies and procedures including the use of derivatives to hedge interest rate risk on debt instruments. The Company may also use derivatives to manage commodity prices in the daily operations of the business.

A three-level valuation hierarchy exists for disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels are defined as follows:

Level 1 – Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 – Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

Level 3 – Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

The following table summarizes the inputs to the valuations for each type of fair value measurement:

Fair Value Measurement TypeValuation Inputs
Employee holdings (other than Common Shares) within the supplemental executive retirement plan (the “SERP”)Quoted market prices for identical assets. These holdings are included in other assets and other liabilities on the consolidated balance sheets.
Redeemable Noncontrolling Interests – Operating Partnership/Redeemable Limited PartnersQuoted market price of Common Shares.
Mortgage notes payable and private unsecured debt (including its commercial paper and line of credit, if applicable)Indicative rates provided by lenders of similar loans.
Public unsecured notesQuoted market prices for each underlying issuance.
DerivativesReadily observable market parameters such as forward yield curves and credit default swap data.

The fair values of the Company’s financial instruments (other than the items listed above and the investments disclosed below) approximate their carrying or contract value. The following table provides a summary of the carrying and fair values for the Company’s mortgage notes payable and unsecured debt (including its commercial paper and line of credit, if applicable) at June 30, 2025 and December 31, 2024, respectively (amounts in thousands):

June 30, 2025December 31, 2024
Carrying ValueEstimated Fair Value (Level 2)Carrying ValueEstimated Fair Value (Level 2)
Mortgage notes payable, net$1,594,765$1,522,268$1,630,690$1,506,955
Unsecured debt, net6,777,0616,443,7916,491,0556,036,591
Total debt, net$8,371,826$7,966,059$8,121,745$7,543,546

The following tables provide a summary of the fair value measurements for each major category of assets and liabilities measured at fair value on a recurring basis and the location within the accompanying consolidated balance sheets at June 30, 2025 and December 31, 2024, respectively (amounts in thousands):

Fair Value Measurements at Reporting Date Using
DescriptionBalance Sheet Location6/30/2025Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1)Significant Other Observable Inputs (Level 2)Significant Unobservable Inputs (Level 3)
Assets
Supplemental Executive Retirement PlanOther Assets$101,020$101,020$—$—
Liabilities
Supplemental Executive Retirement PlanOther Liabilities$101,020$101,020$—$—
Redeemable Noncontrolling Interests –
Operating Partnership/Redeemable
Limited PartnersMezzanine$317,905$—$317,905$—
Fair Value Measurements at Reporting Date Using
DescriptionBalance Sheet Location12/31/2024Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1)Significant Other Observable Inputs (Level 2)Significant Unobservable Inputs (Level 3)
Assets
Supplemental Executive Retirement PlanOther Assets$109,935$109,935$—$—
Liabilities
Supplemental Executive Retirement PlanOther Liabilities$109,935$109,935$—$—
Redeemable Noncontrolling Interests –
Operating Partnership/Redeemable
Limited PartnersMezzanine$338,563$—$338,563$—

The following tables provide a summary of the effect of cash flow hedges on the Company’s accompanying consolidated statements of operations and comprehensive income for the six months ended June 30, 2025 and 2024, respectively (amounts in thousands):

June 30, 2025 Type of Cash Flow HedgeAmount of Gain/(Loss) Recognized in OCI on DerivativeLocation of Gain/(Loss) Reclassified from Accumulated OCI into IncomeAmount of Gain/(Loss) Reclassified from Accumulated OCI into Income
Derivatives designated as hedging instruments:
Interest Rate Contracts:
Forward Starting Swaps$(3,550)Interest expense$(951)
Total$(3,550)$(951)
June 30, 2024 Type of Cash Flow HedgeAmount of Gain/(Loss) Recognized in OCI on DerivativeLocation of Gain/(Loss) Reclassified from Accumulated OCI into IncomeAmount of Gain/(Loss) Reclassified from Accumulated OCI into Income
Derivatives designated as hedging instruments:
Interest Rate Contracts:
Forward Starting Swaps$—Interest expense$(1,210)
Total$—$(1,210)

As of June 30, 2025 and December 31, 2024, there were approximately $1.6 million and $4.2 million in deferred gains, net, included in accumulated other comprehensive income (loss), respectively, related to previously settled and/or unsettled derivative instruments, of which an estimated $1.1 million may be recognized as additional interest expense during the twelve months ending June 30, 2026.

During the six months ended June 30, 2025, the Company paid approximately $3.5 million to settle five forward starting swaps in conjunction with the issuance of $500.0 million of seven-year unsecured public notes. The entire $3.5 million was initially deferred as a component of accumulated other comprehensive income (loss) and $2.3 million will be recognized as an increase to interest expense over the seven-year term of the notes. The remaining $1.2 million covering the final three years of the ten-year term of the swaps will be amortized in conjunction with a future note refinance.

Other

The Company has invested in various equity securities without readily determinable fair values and has elected to measure them using the measurement alternative in accordance with the applicable accounting standards for equity securities. These investments are carried at cost less any impairment and adjusted to fair value if there are observable price changes for an identical or similar investment of the same issuer.

The following table summarizes the Company’s real estate technology investment securities included in other assets as of June 30, 2025 and December 31, 2024 (amounts in thousands):

June 30, 2025December 31, 2024
Real Estate Technology Investments$21,760$22,159

During the six months ended June 30, 2025, the Company sold a portion of one of these investment securities for proceeds of approximately $0.4 million, which approximated the Company's basis in the investment security.

10.

Earnings Per Share and Earnings Per Unit

Equity Residential

The following tables set forth the computation of net income per share – basic and net income per share – diluted for the Company (amounts in thousands except per share amounts):

Six Months Ended June 30,Quarter Ended June 30,
2025202420252024
Numerator for net income per share – basic:
Net income$463,583$488,587$198,785$183,555
Allocation to Noncontrolling Interests – Operating Partnership(12,328)(13,278)(5,226)(5,003)
Net (income) loss attributable to Noncontrolling Interests – Partially Owned Properties(2,307)(2,039)(1,203)(1,069)
Preferred distributions(711)(902)(355)(355)
Premium on redemption of Preferred Shares—(1,444)——
Numerator for net income per share – basic$448,237$470,924$192,001$177,128
Numerator for net income per share – diluted:
Net income$463,583$488,587$198,785$183,555
Net (income) loss attributable to Noncontrolling Interests – Partially Owned Properties(2,307)(2,039)(1,203)(1,069)
Preferred distributions(711)(902)(355)(355)
Premium on redemption of Preferred Shares—(1,444)——
Numerator for net income per share – diluted$460,565$484,202$197,227$182,131
Denominator for net income per share – basic and diluted:
Denominator for net income per share – basic379,359378,699379,508378,578
Effect of dilutive securities:
OP Units10,42010,68110,32910,693
Long-term compensation shares/units1,5661,1681,6611,271
Denominator for net income per share – diluted391,345390,548391,498390,542
Net income per share – basic$1.18$1.24$0.51$0.47
Net income per share – diluted$1.18$1.24$0.50$0.47

ERP Operating Limited Partnership

The following tables set forth the computation of net income per Unit – basic and net income per Unit – diluted for the Operating Partnership (amounts in thousands except per Unit amounts):

Six Months Ended June 30,Quarter Ended June 30,
2025202420252024
Numerator for net income per Unit – basic and diluted:
Net income$463,583$488,587$198,785$183,555
Net (income) loss attributable to Noncontrolling Interests – Partially Owned Properties(2,307)(2,039)(1,203)(1,069)
Allocation to Preference Units(711)(902)(355)(355)
Allocation to premium on redemption of Preference Units—(1,444)——
Numerator for net income per Unit – basic and diluted$460,565$484,202$197,227$182,131
Denominator for net income per Unit – basic and diluted:
Denominator for net income per Unit – basic389,779389,380389,837389,271
Effect of dilutive securities:
Dilution for Units issuable upon assumed exercise/vesting of the Company’s long-term compensation shares/units1,5661,1681,6611,271
Denominator for net income per Unit – diluted391,345390,548391,498390,542
Net income per Unit – basic$1.18$1.24$0.51$0.47
Net income per Unit – diluted$1.18$1.24$0.50$0.47

11.

Commitments and Contingencies

Commitments

Real Estate Development Commitments

As of June 30, 2025, the Company has both consolidated and unconsolidated real estate projects under development. The following table summarizes the gross remaining total project costs for the Company’s projects under development at June 30, 2025 (total project costs remaining in thousands):

ProjectsApartment UnitsTotal Project Costs Remaining (1)
Projects Under Development
Consolidated1440$63,546
Unconsolidated2639150,228
Total Projects Under Development31,079$213,774

(1)

The Company’s share of the $213.8 million in total project costs remaining approximates $64.5 million, with the balance funded by the Company’s joint venture partners (approximately $3.6 million) and/or applicable construction loans (approximately $145.7 million).

We have entered into, and may continue in the future to enter into, joint venture agreements with third-party partners for the development of multifamily rental properties. The joint venture agreements with each development partner include buy-sell provisions that provide the right, but not the obligation, for the Company to acquire each respective partner’s interests or sell its interests at any time following the occurrence of certain pre-defined events described in the joint venture agreements. See Note 5 for additional discussion.

Other Commitments

We have entered into, and may continue in the future to enter into, real estate technology and other real estate fund investments. As of June 30, 2025, the Company has invested in eleven separate such investments totaling $47.0 million with aggregate remaining commitments of approximately $21.0 million.

Contingencies

Litigation and Legal Matters

The Company, as an owner of real estate, is subject to various federal, state and local laws. Compliance by the Company with existing laws has not had a material adverse effect on the Company. However, the Company cannot predict the impact of new or changed laws or regulations on its current properties or on properties that it may acquire in the future.

The Company is involved in various pending and threatened legal proceedings which arise in the ordinary course of business. The Company evaluates these litigation matters on an ongoing basis, but in no event less than quarterly, in assessing the adequacy of its accruals and disclosures. For legal proceedings in which it has been determined that a loss is both probable and reasonably estimable, the Company records new accruals and/or adjusts existing accruals that represent its best estimate of the loss incurred based on the facts and circumstances known at that time. As of June 30, 2025 and December 31, 2024, the Company’s litigation accruals approximated $42.1 million and $42.4 million, respectively, and are included in other liabilities in the consolidated balance sheets. Actual losses may differ materially from the amounts noted above and the ultimate outcome of these legal proceedings is generally not yet determinable. As of June 30, 2025 and December 31, 2024, the Company does not believe there is any litigation pending or threatened against it that, either individually or in the aggregate and inclusive of the matters accrued for as noted above, may reasonably be expected to have a material adverse effect on the Company and its financial condition.

The Company has been named as a defendant in a number of cases filed in late 2022 and 2023 alleging antitrust violations by RealPage, Inc., a seller of revenue management software products, and various owners and/or operators of multifamily housing, including us, that have utilized these products. The complaints allege collusion among the defendants to illegally fix and inflate the pricing of multifamily rents and seek monetary damages, injunctive relief, fees and costs. All of the cases except for one have been consolidated into a single putative class action in the United States District Court for the Middle District of Tennessee. On December 28, 2023, motions to dismiss this consolidated action, filed by RealPage, Inc. as well as us and our multifamily co-defendants, were denied by the Court and the case is proceeding. Another case with similar allegations has been filed by the District of Columbia against RealPage, Inc. and a number of multifamily owners and/or operators, including us, and no assurance can be given that similar additional cases will not be filed in the future. We believe these various lawsuits are without merit and we intend to vigorously defend against them. As these proceedings are in the early stages, it is not possible for the Company to predict the outcome nor is it possible to estimate

the amount of loss, if any, which may be associated with an adverse decision in any of these cases.

The Company is named as a defendant in a class action in the United States District Court for the Northern District of California filed in 2016 which alleges that the amount of late fees charged by the Company were improperly determined under California law. The plaintiffs are seeking monetary damages and other relief. On April 8, 2024, the Court issued certain findings of facts and conclusions of law that are adverse to the Company’s legal position. At this time, the Company is continuing to defend the action. While the resolution of this matter cannot be predicted with certainty, the Company does not believe that the eventual outcome will have a material adverse effect on the Company and its financial condition.

12.

Reportable Segments

Operating segments are defined as components of an enterprise that engage in business activities from which they may earn revenues and incur expenses and about which discrete financial information is available that is evaluated regularly by the chief operating decision maker. The chief operating decision maker, who is the Company’s chief executive officer, decides how resources are allocated and assesses performance on a recurring basis at least quarterly.

The Company’s primary business is the acquisition, development and management of multifamily residential properties, which includes the generation of rental and other related income through the leasing of apartment units to residents. The chief operating decision maker evaluates the Company’s operating performance of our apartment communities geographically by market on a same store basis and in total on a non-same store basis, which represent our operating segments.

The Company has aggregated its geographic same store operating segments into one reportable segment called same store. Management believes the properties in the same store reportable segment have similar economic characteristics, facilities, services and residents, which is in alignment with the required aggregation criteria. The following reflects the two reportable segments for the Company:

Same store primarily includes all properties acquired or completed that were stabilized (defined as having achieved 90% physical occupancy for three consecutive months) for all of the current and comparable periods presented.

Non-same store primarily includes all properties acquired during the current and prior year, any properties in lease-up and not stabilized for all of the current and comparable periods presented and any properties undergoing major renovations.

The Company has non-residential activities included in each of its reportable segments, which account for less than 4.0% of total revenues for the six months ended June 30, 2025 and 2024, respectively, and serve as an amenity for our residential residents. All revenues are from external customers and there is no customer who contributed 10% or more of the Company’s total revenues during the six months and quarters ended June 30, 2025 and 2024, respectively.

The primary financial measure for the Company’s reportable segments is net operating income (“NOI”), which represents rental income less: 1) property and maintenance expense and 2) real estate taxes and insurance expense (all as reflected in the accompanying consolidated statements of operations and comprehensive income). The Company believes that NOI is helpful to investors as a supplemental measure of its operating performance because it is a direct measure of the actual operating results of the Company’s apartment properties. Revenues for all leases are reflected on a straight-line basis in accordance with GAAP for the current and comparable periods.

The following table presents a reconciliation of net income per the consolidated statements of operations to NOI for the six months and quarters ended June 30, 2025 and 2024, respectively (amounts in thousands):

Six Months Ended June 30,Quarter Ended June 30,
2025202420252024
Net income$463,583$488,587$198,785$183,555
Adjustments:
Property management70,60268,96934,78633,511
General and administrative36,78634,35118,53118,631
Depreciation497,635450,093240,889224,398
Net (gain) loss on sales of real estate properties(212,432)(227,994)(58,280)(39,809)
Interest and other income(3,821)(10,657)(2,129)(1,328)
Other expenses8,96145,1234,80513,385
Interest:
Expense incurred, net147,431133,04075,31765,828
Amortization of deferred financing costs4,2473,8362,1031,918
Income and other tax expense (benefit)829635407331
(Income) loss from investments in unconsolidated entities11,4073,3724,9961,674
Net (gain) loss on sales of land parcels78—11—
Total NOI$1,025,306$989,355$520,221$502,094

The following tables present NOI from our rental real estate for the six months and quarters ended June 30, 2025 and 2024, respectively (amounts in thousands):

Six Months Ended June 30, 2025Six Months Ended June 30, 2024
Rental IncomeOperating ExpensesNOIRental IncomeOperating ExpensesNOI
Same store (1)
Los Angeles$242,484$76,589$165,895$239,386$73,686$165,700
Orange County63,81114,22149,59062,27213,80548,467
San Diego42,3929,30733,08541,3708,60432,766
Subtotal - Southern California348,687100,117248,570343,02896,095246,933
San Francisco223,06767,254155,813214,83364,258150,575
Washington, D.C.226,46371,768154,695216,93368,319148,614
New York254,116104,832149,284246,136101,455144,681
Boston164,61349,663114,950162,53247,354115,178
Seattle139,13139,65799,474135,97438,86397,111
Denver38,36711,80826,55939,69011,83527,855
Other Expansion Markets39,39116,95222,43940,86816,21924,649
Total same store1,433,835462,051971,7841,399,994444,398955,596
Non-same store91,12433,29257,83220,1629,50910,653
Total reportable segments1,524,959495,3431,029,6161,420,156453,907966,249
Other (2)4,6788,988(4,310)44,82521,71923,106
Totals$1,529,637$504,331$1,025,306$1,464,981$475,626$989,355

(1)

For the six months ended June 30, 2025 and 2024, same store represented 75,072 apartment units.

(2)

Other includes development, other corporate operations and operations prior to disposition for properties sold.

Quarter Ended June 30, 2025Quarter Ended June 30, 2024
Rental IncomeOperating ExpensesNOIRental IncomeOperating ExpensesNOI
Same store (1)
Los Angeles$121,545$37,782$83,763$120,118$35,856$84,262
Orange County31,9646,96425,00031,1716,90824,263
San Diego21,2874,62216,66520,7464,25716,489
Subtotal - Southern California174,79649,368125,428172,03547,021125,014
San Francisco114,49733,20181,296109,54931,33078,219
Washington, D.C.116,49636,01680,480111,28035,36075,920
New York127,96051,83276,128122,17250,07772,095
Boston82,91724,18458,73382,08123,26658,815
Seattle69,76919,91249,85768,42719,63248,795
Denver19,1995,75313,44619,9375,80114,136
Other Expansion Markets21,4099,16812,24122,2698,83113,438
Total same store727,043229,434497,609707,750221,318486,432
Non-same store40,93415,37625,5584,9202,4772,443
Total reportable segments767,977244,810523,167712,670223,795488,875
Other (2)8503,796(2,946)21,4938,27413,219
Totals$768,827$248,606$520,221$734,163$232,069$502,094

(1)

For the quarters ended June 30, 2025 and 2024, same store represented 75,950 apartment units.

(2)

Other includes development, other corporate operations and operations prior to disposition for properties sold.

The following tables present reconciliations of operating expenses for each reportable segment for the six months and quarters ended June 30, 2025 and 2024, respectively (amounts in thousands):

Six Months Ended June 30, 2025Six Months Ended June 30, 2024
Same Store (1)Non-Same StoreTotalSame Store (1)Non-Same StoreTotal
Operating expenses:
Real estate taxes$187,733$11,837$199,570$183,209$3,488$186,697
On-site payroll85,7866,48192,26783,4181,69785,115
Utilities73,2705,04278,31267,3501,47068,820
Repairs and maintenance61,6885,56267,25059,5821,16560,747
Other (2)53,5744,37057,94450,8391,68952,528
Total$462,051$33,292$495,343$444,398$9,509$453,907

(1)

For the six months ended June 30, 2025 and 2024, same store represented 75,072 apartment units.

(2)

Other operating expenses for each reportable segment includes insurance, leasing and advertising and other on-site operating expenses.

Quarter Ended June 30, 2025Quarter Ended June 30, 2024
Same Store (1)Non-Same StoreTotalSame Store (1)Non-Same StoreTotal
Operating expenses:
Real estate taxes$93,975$5,647$99,622$92,375$833$93,208
On-site payroll42,9372,84445,78141,96241142,373
Utilities34,3442,05736,40131,71129532,006
Repairs and maintenance32,6202,84235,46230,85938131,240
Other (2)25,5581,98627,54424,41155724,968
Total$229,434$15,376$244,810$221,318$2,477$223,795

(1)

For the quarters ended June 30, 2025 and 2024, same store represented 75,950 apartment units.

(2)

Other operating expenses for each reportable segment includes insurance, leasing and advertising and other on-site operating expenses.

The following table presents a reconciliation of total assets and capital expenditures as of and for the six months ended June 30, 2025 (amounts in thousands):

June 30, 2025
Same Store (1)Non-Same StoreOther (2)Total
Total assets$17,409,992$2,907,037$710,485$21,027,514
Capital expenditures$128,559$15,239$570$144,368

(1)

For the six months ended June 30, 2025, same store represented 75,072 apartment units.

(2)

Other includes development, other corporate operations and capital expenditures for properties sold.

13.

Subsequent Events

There have been no material subsequent events occurring since June 30, 2025.

Next: Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations