Earnings Per Common Share

3 Months Ended

Mar. 31, 2023

EARNINGS PER COMMON SHARE

Basic earnings per common share is computed using the two-class method by dividing net income attributable to common stockholders by the weighted average number of common shares outstanding during the period. All outstanding unvested restricted stock awards contain rights to non-forfeitable dividends and participate in undistributed earnings with common stockholders; accordingly, they are considered participating securities that are included in the two-class method. Diluted earnings per common share measures the performance of the Company over the reporting period while giving effect to all potential common shares that were dilutive and outstanding during the period. The denominator includes the weighted average number of basic shares and the number of additional common shares that would have been outstanding if the potential common shares that were dilutive had been issued, and is calculated using either the two-class, treasury stock or as if-converted method, whichever is most dilutive. Potential common shares are securities (such as options, convertible debt, Series A Participating Redeemable Preferred Units (“Series A Units”), Series B Redeemable Preferred Units (“Series B Units”), Series D Redeemable Preferred Units (“Series D Units” and, together with the Series A Units and Series B Units, the “Preferred OP Units”) and common Operating Partnership units (“OP Units”)) that do not have a current right to participate in earnings of the Company but could do so in the future by virtue of their option, redemption or conversion right.

In computing the dilutive effect of convertible securities, net income is adjusted to add back any changes in earnings in the period associated with the convertible security. The numerator also is adjusted for the effects of any other non-discretionary

changes in income or loss that would result from the assumed conversion of those potential common shares. In computing diluted earnings per common share, only potential common shares that are dilutive (i.e. those that reduce earnings per common share) are included.

For the purposes of computing the diluted impact of the potential exchange of the Preferred Operating Partnership units for common shares upon redemption, where the Company has the option to redeem in cash or shares and where the Company has stated the intent and ability to settle the redemption in shares, the Company divided the total value of the Preferred Operating Partnership units by the average share price for the period presented. The average share price for the three months ended March 31, 2023 and 2022 was $157.15 and $198.83, respectively.

The following table presents the number of Preferred Operating Partnership units as if converted into potential common shares, that were excluded from the computation of earnings per share as their effect would have been anti-dilutive.


	For the Three Months Ended March 31,
	2023	2022
	Equivalent Shares (if converted)	Equivalent Shares (if converted)


Series B Units	213,606	182,974
Series D Units	—	1,033,222
	213,606	1,216,196

On January 25, 2023, the remaining Series A Units were redeemed (see Note 13 below). For the purposes of computing the diluted impact on earnings per share of the potential exchange of Series A Units for common shares upon redemption, where the Company had the option to redeem in cash or shares and where the Company had stated the positive intent and ability to settle at least $101,700 of the instrument in cash (or net settle a portion of the Series A Units against the related outstanding note receivable), only the amount of the instrument in excess of $101,700 was considered in the calculation of shares contingently issuable for the purposes of computing diluted earnings per share as allowed by ASC 260-10-45-46. Accordingly, the number of shares included in the computation for diluted earnings per share related to the Series A Units was equal to the number of Series A Units outstanding, with no additional shares included related to the fixed $101,700 amount.

The computation of earnings per common share is as follows for the periods presented:


	For the Three Months Ended March 31,
	2023		2022
Net income attributable to common stockholders	$	196,304	$	203,579
Earnings and dividends allocated to participating securities	(304)		(286)
Earnings for basic computations	196,000		203,293

Income allocated to noncontrolling interest - Preferred Operating Partnership Units and Operating Partnership Units	12,128		11,693
Fixed component of income allocated to noncontrolling interest - Preferred Operating Partnership (Series A Units)	—		(572)
Net income for diluted computations	$	208,128	$	214,414

Weighted average common shares outstanding:
Average number of common shares outstanding - basic	134,511,273		134,180,175
OP Units	7,214,649		6,520,781
Series A Units	—		875,480

Series D Units	1,210,056		—

Shares related to dilutive stock options	4,406		5,426
Average number of common shares outstanding - diluted	142,940,384		141,581,862
Earnings per common share
Basic	$	1.46	$	1.52
Diluted	$	1.46	$	1.51